ONS says a slight fall in fuel prices has kept
inflation at 2.7%
The “core” inflation rate – which excludes items such as fuel and household food – rose by 0.2% to 2.2% and while the headline rate has remained steady for the second month in a row, CPI is still running at more than double the rate of average wage increases.
According to the Office for National Statistics, it means a basket of goods and services that cost £100.00 in September 2012 would have cost £102.70 last month.
However, over the same period, average wage increases have been just 1.1%.
Separate figures from the ONS show UK house prices increased by 3.8% in the 12 months to August, with a sharp rise for first-time buyers at 4.9% higher on average.
Analysts say the 12-month inflation rate continues the trend seen since Spring 2012 of broadly steady inflation, with air fares pushing the rate up, offset by a 0.2% fall in fuel prices, according to the ONS.
The inflation figures for September are key pointers to living standards for the coming year, because the CPI rate is normally used to set business rates as well as any increases in benefits such as the state pension and those for disabled people and carers.
In the 12 months to August 2013 UK house prices increased by 3.8%, up from a 3.3% increase in the 12 months to July 2013.
TUC general secretary Frances O’Grady said: “With London house prices sky-rocketing, while real incomes continue to fall, this recovery looks dangerously lopsided.
“Until real wages start growing again households will have to take on more and more debt just to get by, which is exactly the kind of recovery the UK needs to avoid.
“The fact that house prices for first-time buyers are now rising 50% faster than for existing owners should sound further warning bells, particularly as the Help to Buy scheme is only starting to take effect.
“The government should look again at lowering the limit on Help to Buy to £300,000 to prevent the London property market getting even more overheated.
“It’s no good promising people help with a deposit if a housing bubble then means they have no chance of affording a home.”
The ONS inflation figures show food inflation has remained almost static at 4.8%, with the price of fruit and vegetables showing a slight rise.
UNISON general secretary, Dave Prentis, said: “The headline figure masks the cost of everyday essentials.
“For many workers the gap between pay and prices is widening. Just last week one major energy supplier announced an 8% price rise and others are expected to follow suit.
“Holding public sector workers to a 1% pay rise is condemning many families to face a heat or eat dilemma this winter.
“It is time the government recognised the real hardship that its damaging pay policy is inflicting on hard pressed workers including nurses, teaching assistants, paramedics, care workers, cleaners, cooks and porters.”
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