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“Working families are already feeling the crunch. But the triple whammy of an imminent rise in the energy price cap, real wages falling and Tory tax rises coming down the tracks are going to make this crisis even worse.”
The prices of clothing, furniture and housing were also driving up the cost of living, Office for National Statistics (ONS) analysts said.
“These large rises were slightly offset by petrol prices, which despite being at record levels were stable this month, but rose this time last year,” said Grant Fitzner, chief economist for the ONS.
“The closures in the economy last year have impacted some items but, overall, this effect on the headline rate of inflation is negligible.”
Chancellor Rishi Sunak said the government was spending around £12bn to help families under financial pressure.
“I understand the pressures people are facing with the cost of living, and we will continue to listen to people’s concerns as we have done throughout the pandemic,” he added.
By December, food prices had increased by 4.2 per cent on the previous year.
Wages are being outpaced by the UK cost of living, with a 3.8 per cent increase in weekly earnings completely nullified by the accelerating prices of daily essentials.
“We’ve not seen the end of rising inflation yet,” said Alpesh Paleja, lead economist at the CBI (Confederation of British Industry).
“We expect it to peak in the months head, not least if, as expected, the energy price cap is raised.
“With prices on the rise and real wages already falling, it’s likely households will face a cost of living crunch for much of this year.”
Rebecca McDonald, senior economist at the Joseph Rowntree Foundation, said many families are already feeling the squeeze.
“The full effects of the massive energy cost increases expected in April when the price cap is lifted, coupled with rises many have seen so far in energy, food and other essentials, will combine to present many with completely impossible choices,” she said.
“Living in a cold home or restricting the food you buy for yourself or your children places an enormous strain on families, but we know it is a daily reality already for many. As well as rising foodbank use, we are seeing instances of people needing to seek other sources of help, such as asking neighbours for spare duvets in order to keep warm.
“For those on the lowest incomes, even small increases risk pulling them deeper into poverty, with the support available through the social security system proving inadequate to protect families from harm.
“Urgent and targeted support for people in poverty is essential if families in this country are to bear the shock of this latest rise to their cost of living.”