HIGH inflation has hit Britain’s living standards in relation to other countries since 2005, official data showed yesterday, sending the UK tumbling down the income league tables.
The UK was ranked fifth in disposable income for households in 2005, but had fallen to 12th by 2011, behind France and Belgium.
The US, Luxembourg, Norway and Germany held their top four places in both years.
UK households’ average disposable income rose by just seven per cent over these six years, while German incomes soared by 22 per cent. This was attributed to the falling sterling and higher inflation since the financial crisis, which has hit real wages.
The pound tumbled against other currencies in 2007 and 2008, and still remains 20 per cent below its pre-crisis peak. Meanwhile inflation has been well above the Bank of England’s two per cent target for more than three years.
The UK also moved up in public debt rankings: in 2005 the UK was the 15th most indebted OECD state, moving to seventh in 2011.
However, Britain has held up well in terms of unemployment, seeing a smaller rise during the recession in the US and several EU countries.