After observing the decline in CPI inflation to 6.8%, the Prime Minister shared the message below on X (previously known as Twitter).
Free UK news agency, Newspage, sought the views of financial services experts and small business owners on whether the Government can take any credit for bringing down inflation.Â
Here’s what they had to say.
Rohit Kohli, operations director at The Mortgage Stop:
“For the Government to even consider trying to take credit for driving inflation down is ridiculous at best. You can’t claim that inflation was driven up by external factors to justify taking no action, and then, having taken no action and seeing it come down, claim it was your intervention that drove it. This is like a football player running onto the pitch with full kit to claim credit, having not played at all.”
Daniel Wiltshire, actuary & IFA at Wiltshire Wealth:
“The Government are being completely disingenuous about inflation. Inflation is simply not something they can control and hasn’t been since the Bank of England became independent. Rishi is trying to score cheap political points from something most economists thought would happen anyway, and it looks as though his gamble will pay off, just.”
Benjamin Woodhouse, co-owner at Balguard Engineering Ltd:
“It would require all the AI super-computers on the planet to work out how there is a causal link between the latest inflation figures and Government action. The Goverment has demonstrated through their inactivity that they are merely passengers when it comes to inflation.
“The new childcare package doesn’t kick in until the back end of next year so that’s a nonsensical clutch at straws, and the £1bn in pension cuts only benefit those wealthy surgeons they are trying to prevent from retiring, so has no bearing on consumer spending.
“He doesn’t mention avoiding giving the NHS pay rises and in so doing creating the biggest Healthcare waiting lists since the Crimean War. Backing oil and gas is also a huge long-term plan, as well as an amazing short-sighted and tone-deaf plan to the climate crisis that is bound to change before it makes any structural difference to inflation.”
Stephen Perkins, managing director at Yellow Brick Mortgages:
“The Government will take the credit, but they and the Bank of England have done nothing to help with inflation. The reduction is based on external wholesale energy price decreases, which is no reflection of the actions taken, which have mostly been incessantly increasing the base rate.”
Keith Budden, managing director at Ensurety:
“Perhaps it’s because Rishi has spent time in America recently, but for him to claim credit for reducing inflation has marginally more credibility than Donald Trump denying all of the charges against him in the American courts. As a Government, you either accept that rising inflation was down to your actions, and therefore your actions can reduce inflation, or you claim it’s all down to the independent Bank of England.
“You can’t have your cake and eat it. Anyone with the slightest grasp of national budgets knew that Rishi was onto a pretty certain thing when he pledged that he would get inflation down to around 5% by year-end. The shocks to the national budget from the Ukraine war have now worked their way through the system, but ask the average man or woman on the street and they will tell you that inflation, and particularly food inflation, is still really hurting.”
Riz Malik, founder & director at R3 Mortgages:
“I wish the Government wouldn’t claim credit for every positive economic update. However, they cannot be accused of mismanaging the economy because it would mean they made an attempt to manage it to begin with. I’m still waiting to hear about any concrete steps the Government has taken to reduce inflation. At this rate, Rishi and Jeremy might just take credit for Christmas.”
Samuel Mather-Holgate, independent financial advisor at Mather and Murray Financial:
“Sunak’s key policy of halving inflation was as contemptuous as it comes. The Tories know that inflation was caused by a massive supply shock in energy and will come back down to target without the need for Government intervention. Claiming victory on the policy is the kind of cynical move we now expect from this Government.
“The Bank of England has gone too far in trying to curb inflation and they will have to slash rates quickly when the economy has a heart attack. This may play into Sunak’s hands as mortgage rates will start to plummet just around the time a General Election is being called.”
Lewis Shaw, owner and mortgage expert at Shaw Financial Services:
“The Government has done absolutely nothing to bring down inflation. Rishi parrots lines about it being his priority but has enacted zero policies to this effect. They could have taxed back the money dished out during Covid, implemented a windfall tax on banks and introduced a temporary 75% income tax bracket on those earning more than £250,000. It’s challenging to come up with Das Kapital during a work break, but they could have done something. However, they did nothing and are now seeking to get the plaudits.
“It’s a bit rich for Rishi to claim he’s managed the finances well: child poverty is at record levels, wealth inequality is rising and the NHS is crumbling around us. What a record. If I cocked my job up that badly, I’d be struck off within a week, whereas he’ll continue his voyage on the gravy train and no doubt end up with a lordship. I thought we were supposed to live in a meritocracy. The only thing that gets rewarded these days is incompetence.”
Justin Moy, managing director at EHF Mortgages:
“The Government have clearly adopted a ‘let it sort itself out’ style of managing the inflation problem, as the ‘big’ drop in inflation was totally expected once fuel price increases from 2022 had finally worked through.
“There are very few constructive measures specifically adopted for short-term inflation factors. Instead, the Government have left it to the Bank of England to annoy the popular Tory voters with the rate increases, pleasing the savers and retired population instead.
“We still have high inflation, and the core figures are suggesting that we are still right in the middle of the problem, and the Government want to tell us again about a childcare package that cannot operate as there is not enough infrastructure to deliver this promise. Let’s talk about quick, effective measures to help borrowers now, not in 2025.”
James Miles, director – mortgage adviser at The Mortgage Quarter:
“The cheek of Rishi claiming he’s the UK’s saviour. If doubling down and squeezing the purse strings of everyday people is what voters want from a PM then he needs to follow Truss and push the button for a General Election.
“The Government have shown complete mismanagement with the highest inflation rates in the G8 and boomerang policies that they spin to fit their narrative.”
Darryl Dhoffer, mortgage expert at The Mortgage Expert
“The Government appears to be taking praise for the independent measures undertaken by the Bank of England. An area they could have tackled is to make importing cheaper, with a temporary reduction on taxes, or have looked to reduce export subsidy tax, to support UK businesses to make it easier for our manufacturing of goods and services, and therefore not reliant on a full export market.”
Tom Anderson, CEO at Hummingbird Agency:
“The decline in CPI inflation to 6.8% suggests progress in the government’s inflationary measures, but it’s still astronomical and it’s killing decision-making in the business world. While the Bank of England plays a pivotal role in managing inflation through monetary policy, the government’s fiscal strategies and external factors also significantly influence inflation rates.
“If it were up to me, I’d introduce a temporary price control on essential goods, ensuring affordability while addressing supply chain issues. However, such measures require careful consideration due to potential market distortions.”
Scott Taylor-Barr, financial adviser at Barnsdale Financial Management:
“The Government pretty much dodged all responsibility for trying to control interest rates, very firmly placing the blame and the responsibility of sorting it with the Bank of England, setting up the Bank and its Governor as villains of the piece and their intended scapegoat if things didn’t go their way.
“The Government could have easily raised VAT or income tax to reduce spending and control inflation, which would have been much fairer than leaving those few who happened to be coming to the end of their mortgage deals to carry the can for the entire country. However, with an election coming up, it felt better to hang those few out to dry and blame the Monetary Policy Committee.”
Mike Staton, director at Staton Mortgages:
“The Government has done absolutely diddly squat to decrease inflation, they have prolonged the pain of the base rate increases by competing with the Bank of England to reduce mortgage costs. Ironically, during Wimbledon, both the Government and Bank of England were playing a huge game of tennis and it has been a complete washout. Rishi out! but I have no clue who is capable of leading us in the right direction, so just put me on a Rocket to Mars please.”
James Bull, mortgage broker at JB Mortgages:
“Inflation is coming down naturally as the impact of lower energy prices filters into the economy. The Government has had very little impact on this as it would have happened anyway regardless of Government intervention.
“Inflation coming down will be of little comfort to homeowners used to ultra-low mortgage interest rates who now have to fork out around 6%, costing them hundreds of pounds extra per month.”
