Is the cost of living crisis over in 2026

The news

Prime Minister Andy Burnham has launched a national tour and vowed to tackle the ongoing cost-of-living crisis with measures including easier cancellation of unwanted subscriptions and a ban on misleading retailer discount claims. The government estimates these steps will save consumers £14 a month for every unwanted subscription cancelled. Burnham has made creating room to breathe his number one priority, stating that the whole government is united on easing pressures that continue to weigh heavily on many people’s lives. Food prices in the UK are on course to be 50% higher by the end of the year due to global supply disruptions, extreme weather, geopolitical tensions and volatility in oil and gas markets.

What's at stake

UK inflation peaked at 11.1% in 2022 amid energy shocks and global supply issues, driving sharp rises in household bills and food prices. Inflation has since fallen below 3%, yet real wages remain below pre-crisis trends in many sectors and household savings ratios have declined. Recent data shows living standards fell in early 2026 despite economic growth. Many families continue to report difficulty with essentials, and cumulative price rises have permanently raised the cost base for households. Burnham’s agenda in the early days of leadership has focused on interventions designed to make life easier, with suggestions these measures could come at the cost of climate action.

The case for

Inflation has fallen sharply from its 2022 peaks and the acute emergency phase has passed. The government is on the side of families working hard to make ends meet while making sure the rules are clear for businesses and easy to follow. Everyday hassles such as subscription traps and misleading sales add up, especially when the cost of living weighs heavily, and pulling every lever to ease that burden sends a message that the country can help people get on. Burnham has made it clear from day one that creating room to breathe is the priority, with the whole government united on delivering everyday fixes that make life easier and more affordable.

The case against

Cumulative price rises have permanently raised the cost base while real wages lag, leaving many households worse off. Food prices in the UK are on course to be 50% higher by the end of the year due to global supply disruptions, extreme weather, geopolitical tensions and volatility in oil and gas markets. Living standards fell in early 2026 despite economic growth, and too many people still face ongoing difficulty with essentials. Burnham’s early measures, while aimed at relief, risk impeding long-term climate and economic resiliency according to analysis of his re-prioritisation of commitments. The lived experience for many remains that basic things cost too much.

Why it matters now

If the crisis is judged over, national policy can shift away from emergency relief toward longer-term goals. If persistent pressures are recognised, further interventions will be needed to address household budgets before the end of 2026. Burnham’s national tour and early leadership decisions will test whether short-term cost-of-living fixes take precedence over other commitments. The outcome will shape government spending and regulatory priorities through the remainder of the year.

Further reading

The Guardian · edie.net

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