Tenancy Support

The causes of the crisis are out of the control of the association, the surge in global demand for products and commodities coupled with limited supply and supply disruption has resulted in a very uncertain economic state with wildly fluctuating prices and surging inflation.

The net impact of the situation is that household income has not kept pace with the cost of living. The greatest impact is felt by those most financially disadvantaged households. The response of UK Government has not targeted the most vulnerable in society, with future planned tax cuts will benefit the richest members of society.

The economic forecasts project inflation peaking at c. 10% in 2022 before falling back to the target of 2% in 2024/25. The forecasts do not project negative inflation, so the new elevated prices are not a blip but have achieve a new permanent level. Income inflation is not projected to match or “catch-up” with price inflation for a number of years. The cost of living crisis is a new normal …at least for the medium term.

The affordability situation has been an ever-present priority for the association, however, the challenges presented by the current situation are bigger and more impactful than ever. The Resolution Foundation state that 9% of the UK population are already in a situation where they cannot afford to pay for basic and essential services and products (e.g. home, fuel and food) and this figure is expected to double in the winter 2022/23. They also state that an additional 25% of households cannot afford “usual living costs” and are having to make choices in what they purchase in areas such as school uniforms, household essentials etc..

The association has in place key controls to support customers facing affordability and financial challenges. The association also has improving data capabilities to monitor the situation, and further improvement is a priority in this area. The association’s customer and community support activities already recognise financial hardship as a priority area.

The challenges presented by the cost of living crisis have already changed our operational reality and it will become even more difficult as inflationary pressures increase during the next twelve months.

The association will remain alert to the crisis and the impact on our customers and our finances.