The Chancellor delivered a Spring Statement yesterday that he says puts billions of pounds back into the pockets of hard-working people, but many others argue does very little to help with the challenge of rising living costs today.   

What he’d previously hoped would be an update on the economic outlook, rather than a budget, was superseded by global events and rising living costs – not least Russia’s invasion of Ukraine – forcing the chancellor to respond in kind.

The backdrop to the statement was bleak. The Office for Budget Responsibility (OBR) said this year would see “the biggest fall in living standards in any single financial year since ONS records began in 1956-57.”

Announcements in the statement included a 5p reduction to fuel duty; giving local authorities another £500m for the Household Support Fund to help vulnerable households with rising living costs; and raising the National Insurance threshold to £12,570. The Institute for Fiscal Studies reckons the net outcome of the National Insurance increase vs the uplift in the threshold will mean those with an income of £35,000 or below should pay less.

And in what is an eye catching but arguably opportunistic move, he pre-announced a 1p reduction to income tax that will come before the end of this parliament in 2024 – potentially a useful indicator not to expect an early general election. While that change doesn’t come for another two years, the SNP are already under pressure to say what this will mean for taxpayers north of the border.

Reaction to the statement hasn’t been warm. As you would expect, virtually all opposition parties were quick to slam the measures for not going far enough, with the SNP saying Sunak has “completely abandoned” those on the lowest incomes.

Torsten Bell of the Resolution Foundation said “the Chancellor has prioritised burnishing his tax cutting credentials over support for the low-to-middle income households hardest hit by this cost-of-living storm.“ While personal finance mogul Martin Lewis – who has recently made waves in the debate – said “for many it is still peanuts compared to the cost of living crisis.”

In short, as we all see our bills rising, it’s likely many won’t see much change off the back of yesterday’s statement.

What we did see was a political shift change; from the big spending approach of the last couple of years, to what we have come to expect from Conservative chancellors, with much talk of balancing the books and cutting taxes.