Cost of living crisis: Poverty data ‘somewhat misleading’ minister says after claim rising bills could put 400,000 children into crisis

Grant Shapps has suggested the way poverty is presented can be “somewhat misleading” when put to him that rising bills could push 400,000 more children into poverty.

Speaking on Sky News’ Ridge on Sunday programme, the transport secretary admitted that rising costs of living are “very substantial”, but questioned estimates of how many people could be plunged into severe difficulty.

“I don’t want to sort of get us lost in numbers here, but poverty is divided into both absolute and relative (poverty), and sometimes the way it’s presented can be somewhat misleading to say the least,” he said.

“I do not mean to in any way, shape or form underplay it because you don’t have to be an expert – you just look at the cost of living, as you mentioned, the increase in inflation… it’s very substantial.

“And that’s why the chancellor’s already come forward with £22bn.”

Rising living costs ‘very substantial’

Mr Shapps also hinted that more support to ease the burden of rising household bills could be forthcoming, adding that “given the chancellor’s record, I’m sure he’ll always be looking what else he can do” to help.

Read more: Pensioner rising buses to keep warm

The minister’s comments came as shadow business secretary Jonathan Reynolds admitted he is “angry” at the cost of living crisis.

Mr Reynolds also alleged that the “average pub or hairdresser” would be up to £3,000 better off if Labour were in government and handling the situation.

“The cost of living is extreme, the government isn’t doing enough, and people would be better off under Labour,” he told Sky News’ Ridge on Sunday programme.

“That’s because we wouldn’t have proceeded with the national insurance rise; it’s because we would have done that windfall tax to help people with their energy bills.

“It’s because on business rates, which is a huge expense for business, we would have frozen the valuations, we would have increased the threshold in which businesses pay business rates.

“So the average pub or hairdresser, on top of what the government has done, would be around £2,000 to £3,000 better off.

“We would do real help for people now, and that’s what would make a difference.”

Labour: Government ‘isn’t doing enough’

Mr Reynolds also reiterated Labour’s call for a windfall tax would give households a huge amount of financial help with their bills.

April Fool’s Day saw the energy price cap rising by a record sum to help account for surging wholesale prices – with bills yet to even reflect the impact of Russia’s war in Ukraine.

It was announced in February that customers on default tariffs paying by direct debit would see an average annual increase of £693, from £1,277 to £1,971 from 1 April while pre-payment customers are enduring a hike of £708 from £1,309 to £2,017.

Read more: Five million households now in fuel stress

A think-tank specialising in living standards warned that the bill shock would push 2.5 million families in England alone into so-called “fuel stress”, taking the total number of homes spending at least 10% of their incomes on energy to five million.

But the squeeze from bills is not limited just to energy with the likes of broadband, mobile and water bills, council tax and national insurance contributions also rising this month, with help from the chancellor to offset the pain only going so far.

Energy price cap rises by record sum

The Liberal Democrats have urged the government to bring in a “safety net” for struggling families.

The party said extra support is particularly needed for first-time buyers who have “scrimped and saved to get on the housing ladder”.

Read more: What is the price cap and why will bills rise so sharply

Leader Sir Ed Davey criticised Chancellor Rishi Sunak for pushing ahead with a planned tax hike while “people’s homes are on the line”.

“Many first-time buyers who have scrimped and saved to get on the housing ladder will urgently need a safety net to get through what looks like months of mortgage cost rises,” he said.

“We need an emergency mortgage support fund to support struggling families, or we will see people forced to default and hand back the keys to their homes.”

Responding to the Lib Dems’ call, a government spokesperson said: “We understand that people are struggling with the rising cost of living – we can’t shield everyone from these global challenges but are taking action worth over £22bn this financial year to help.”