PRESSURE on the cost of living was at the forefront of debate on the day the chancellor delivered his Spring Statement, with the OBR predicting the largest fall in living standards since the 1950s.

Labour politicians in the region accused the chancellor of failing to get a grip on the cost-of-living crisis while Conservative backbenchers praised the treasury for cutting fuel duty and the national insurance threshold.

However, Ben Houchen, the Conservative Tees Valley Mayor, warned of an “increasingly challenging” situation for many people.

Read more: Chancellor Rishi Sunak cuts fuel duty by 5p

He said: “The pressure local people are feeling – and will continue to feel – will not be dramatically improved by today’s Spring Statement. It didn’t solve problems we face on energy costs, fuel bills or inflation and, while measures such as the NIC threshold increase, living wage increase and fuel duty cut are welcome, they will have no real-terms impact on the money in people’s pockets.

“Government spent more than £400billion to keep people going during the pandemic, on things like furlough and business support, but its interest payments are likely to be more than £80billion this year.

"It’s a figure unparalleled since the Second World War and one that could otherwise be spent on services, supporting those in need and reducing taxes. It’s not unexpected, but that doesn’t make it any less eye-watering.”

Chancellor Rishi Sunak has been delivering his Spring Statement as the cost of fuel, energy and food soar. The Richmond MP said 70 per cent of workers would get an effective tax cut though raising the threshold for paying National Insurance by £3,000.

But the Office for Budget Responsibility says inflation and higher taxes from April mean households face the biggest fall in living standards since records began.

Labour’s Alex Cunningham, MP for Stockton North, called for a windfall tax on North Sea gas and oil to cut energy bills and a reversal of the increase to National Insurance.  

He said: “The Chancellor had a perfect opportunity to a get a grip of the cost-of-living crisis that is hurting so many people across Stockton North and the country in his Spring Statement, but he spectacularly failed to do.”

He added:  “The increase to personal tax thresholds is of course welcome, but it is not enough.  It feels like the Chancellor has pinched a loaf of bread and thrown a few crumbs back. 

“He could have put forward measures that would have significantly, and positively, supported people through this crisis – he chose not to.”

Read more: How Rishi Sunak's Spring Statement will affect you

Mary Foy, MP for Durham, accused the Government of offering no serious measures to help people pay "runaway energy bills", while Kevan Jones, the Labour MP for North Durham, described the 5p fuel duty cut as a “gimmick” saying there was no guarantee the cut would be passed on to the consumer.

He added: “A windfall tax on oil and gas producers would have raised an estimated £1.2 billion to help support families and businesses reduce bills now. This fuel duty gimmick will not appease working people who are facing the highest tax burden in 70 years.”

Conservative MP for Bishop Auckland Dehenna Davison welcomed the “Conservative approach” to the cost of living and post-Covid recovery.

She said: “The National Insurance threshold changes will be a huge cash boost to people in Bishop Auckland, and I am particularly pleased about the much-needed fuel duty cut, which will be a huge relief to motorists, and will particularly help in the rural communities across our region.

“I look forward to seeing more detail about the Chancellor's plan for tax, particularly around employment taxes and research and development relief, changes to which could have huge impacts on our region and our nation's economic growth.”

North East Conservative backbenchers Paul Howell, Jill Mortimer, Matt Vickers and Jacob Young also welcomed the cut to fuel duty and changes to national insurance. 

Meanwhile the Northern Powerhouse Partnership warned a lack of extra cash for the Shared Prosperity Fund to match previous EU funding was of “huge concern” and said the announcement falls short of what is needed to deliver levelling up.

Welcoming the VAT cut for energy saving materials such as solar panels and apprenticeship levy review, director Henri Murison said: “There’s lots to like in today’s spring statement, including tax cuts for businesses, but the statement still falls short of what is needed for Michael Gove to deliver genuine levelling up or for a green industrial revolution to achieve energy security.”

Dr Arianna Giovannini, interim director of the think tank Institute for Public Policy Research North said: “This Spring Statement was the Chancellor’s opportunity to put public money where government’s mouth is. But he seriously missed the mark and failed to announce the substantial measures needed to support people on the lowest incomes, and level up the UK.

"This puts at risk the credibility of the government’s flagship levelling up agenda – which barely featured in the Chancellor’s speech - with real, dramatic consequences for people’s lives.

“People in the North will now rightly begin to question whether the government is serious about its pledge to raise prosperity and close regional divides. The growing chasm between rhetoric and reality is all too familiar to us."

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