Economy, Trade and Rural Affairs Committee inquiry into the cost-of-living crisis - What are the likely economic impacts of the cost-of-living crunch?

The s that the UK economy will shrink in the final quarter of 2022.1 This is projected to be a direct result of high inflation, with households having less money to spend on non-essential items.2 It is likely that the Welsh economy is already feeling the impact of rising costs restricting household spending. [...] More importantly than the impact on business, however, is the impact of such pressures on the thousands of Welsh households that are struggling to afford all the essentials they require. [...] How effective are the support measures that the Welsh and UK governments have put in place, and what further support might be needed over the coming months? The measures put in place by the UK Government to manage the cost-of-living crisis have been grossly inadequate. [...] Action such as increasing benefits in line with inflation and ending the freeze on the Local Housing Allowance will put more money in the pockets of the households that need it the most, reducing the risk of households having to chose between heating and eating. [...] Analysis undertaken by Wales Fiscal Analysis at Cardiff University shows that the nearly £340m package of measures announced by the Welsh Government in February 2022 to support families is significantly more generous than the measures taken in other parts of the UK.15 There is no doubt that measures such as the creation of the Winter Fuel Support Payment and extending the provision of support in l.