Is Labour right to say families are £5,883 worse off under Rishi Sunak?

The Labour party has shared a post on X (formerly Twitter) saying: “Under Rishi Sunak, typical families are now £5,883 worse off.”  

Labour’s press release on the figure claimed “the typical household is now £5,883 worse off since 2019”, and the figure was also reported by several news outlets and repeated by a number of Labour politicians, including shadow attorney general Emily Thornberry. 

Although it wasn’t made explicit in the claims we’ve seen, the figure appears to be an annual estimate—in other words, Labour seems to be claiming typical families are £5,883 a year worse off in 2024 than they were in 2019.

However there are a number of problems with Labour’s figure, which is based on six specific household costs and doesn’t take into account changes to wages or benefits in this time.

Figures from the independent Office for Budget Responsibility (OBR) on real household disposable income per person—a measure of living standards that does take these factors into account— show a much lower decrease since 2019 than Labour’s figure. 

For more of our politics coverage during the general election campaign see our election fact checks and our Election Live blog. 

Where does the £5,883 figure come from?

Labour says £5,883 is the increase to six household costs faced by typical families since 2019.

These consist of: 

• Energy price cap: £479 
• Groceries: £1,040
• Council tax: £421
• Mortgages: £2,880
• Personal tax: £874
• Motoring: £189

There are a number of problems with this figure, however. 

For a start, it only considers the change to six household outgoings. These outgoings don’t apply to all families—for instance, many don’t have a car or a mortgage. And equally, the figure doesn’t include many other outgoings faced by families—water bills, phone bills or insurance, for example. 

Another problem is that the figure doesn’t take into account any changes in wages or benefits since 2019, with some wages and benefits having risen, in cash terms at least.   

As Labour’s press release says, the mortgage figure refers to a Bank of England estimate in December 2023 that said: “The typical owner-occupier mortgagor rolling off a fixed rate between 2023 Q2 and the end of 2026, their monthly mortgage repayments are projected to increase by around £240.” 

While this does equate to £2,880 a year, it is for a specific group whose fixed rate mortgages ended in a certain period. Many mortgage-holders will have rolled off a fixed-rate mortgage since 2019, but it is not necessarily accurate to claim this figure represents a cost incurred by a “typical” family. Around a quarter of dwellings in England are owned with a mortgage. 

It’s also worth noting that, while they’ve been used interchangeably by Labour, households are not the same as families—the Office for National Statistics estimates that there were 28.4 million households and 19.5 million families in the UK in 2023. 

And as pointed out by the BBC’s More or Less programme, it is not necessarily possible to prove that cost increases are a result of Conservative policy, as Labour’s claim seems to imply, rather than other factors. 

We’ve asked Labour about its figures and the problems outlined above, and will update this fact check if we hear back.

What do figures on households’ disposable income show?

As mentioned above, the OBR measures changes in living standards using real household disposable income per person. This is based on a household’s gross disposable income—the amount they have to spend on consumption, or to save or invest, after taxes, National Insurance, pension contributions and interest have been paid—and then factors in inflation.

The OBR’s forecasts following the March 2024 budget show real household disposable income per person falling by £166 per person, from £21,767 in 2019/20 to £21,601 in 2024/25. With on average 2.4 residents in a household, according to the Office for National Statistics, the OBR’s forecast equates to just under £400 less per household, which is clearly much lower than £5,883.

Last month Labour shadow chancellor Rachel Reeves quoted a figure much closer to the OBR estimates when she claimed that “real household income” (though not real household disposable income) was “on course to have fallen by £250 per person” over the course of the last Parliament. We don’t know exactly what that claim was based on, but have asked Labour and will update this fact check if we hear back.

Image courtesy of Keir Starmer