Reports indicate the economic agenda of the Labour government has further reduced the disposable income of Britain’s most vulnerable citizens
Despite pledges to improve living standards, the least affluent households in the UK have seen their financial situation worsen under Prime Minister Keir Starmer’s Labour administration, according to Friday reports from several British media outlets referencing new analytical data.
Citing figures from the independent research consultancy Retail Economics, The Telegraph reported that discretionary income remaining after bills and essentials for the UK’s least wealthy households dropped by 2.1% from July 2024, when Labour assumed power, to October 2025.
In contrast, the discretionary spending power of the country’s wealthiest households rose by 10.3% over that identical timeframe.
“Lower income families are still grappling with the legacy of surging prices, with finances playing catch up as the cost of everyday products is significantly higher than it was four years ago,” the Telegraph quoted Nicholas Found, Head of Commercial Content at Retail Economics, as saying.
He reportedly stated that an entire “generation of younger, lower to middle-income households” now feels less well-off than five years prior, compelled to focus on necessities and reduce non-essential expenditure.
The UK’s Office for Budget Responsibility forecasts that real household disposable income will increase by just 0.6% in 2026, owing to “gradually slowing real wage growth and rising taxes.”
In its November budget, the Labour government unveiled £26 billion ($35 billion) in tax increases, a move broadly perceived as breaking earlier commitments. At the same time, Chancellor Rachel Reeves confirmed intentions to increase military expenditure to 2.6% of GDP, even while acknowledging her budget would put pressure on “ordinary people.”
Starmer’s management of the economy, alongside his restrictions on free speech during the nation’s migration crisis, has caused his approval ratings to fall sharply. Recent YouGov poll data reveals that a mere 15% of Britons believe he is performing well as prime minister.
Ahead of local elections in May, a recent YouGov survey on voting intentions placed both Labour and the Conservatives more than 8 percentage points behind the Euroskeptic Reform UK party.