The Bank of England runs an extensive outreach programme throughout the year. This programme provides a way for members of the public to share their experiences of the economy and hold the Bank to account for the decisions it has taken.
This report provides a summary of the discussions that took place from February 2022 to February 2023. It focuses on the impact of higher inflation, and people’s responses to it.
The report includes information gathered at citizens’ forum sessions, including in-person panels for people living in specific regions and nations and UK-wide virtual events. It also draws on research undertaken by the Bank’s youth forum, and intelligence gathered from community forum events run in partnership with a range of charities and community groups.
It has been compiled on behalf of the chairs of the citizens’ forum panels who play an important role in the delivery of these outreach events for the Bank.
Introduction from the panel chairs
We are volunteers who help the Bank of England to have direct conversations with people from all parts of the UK. We do it because we believe the work the Bank does to listen to people’s views and experiences is vital.
This report is a summary of those conversations and the impact they had.
Some of the main ways these conversations take place are through the Bank of England’s:
- citizens’ forum (including regional panel events and online Economy Hub)
- community forums
- youth forum
We are the independent chairs of the 12 panels covering the UK’s regions and nations that make up the citizens’ forum. This forum has around 4,000 members. Our role is to make sure everyone who takes part in the panel meetings has their voice heard.
There are also community forum events for charities and the people they support. And a youth forum that is specifically for people who are aged 16 to 25.
This report covers the period from February 2022 to February 2023. Over the year, many people used these forums to share their experiences about the sharp rise in the cost of living and the impact it had on them.
Many of the issues we see in our own work in local communities are reflected in this report. Many of us are deeply involved with charities or community groups that are grappling with the challenges caused by high inflation. We know first-hand the difficulties people face.
One of the ways the Bank uses the information it gathers at the forums is to track how sentiment changes over time. This is particularly helpful at times of high economic uncertainty when the other data it uses (including key economic indicators) are more volatile or less reliable than usual. They are often also less timely.
In this report, you’ll see how the information gathered at these events is used to inform the important policy decisions the Bank of England makes.
We thank all the citizens’ forum members and those who have participated in outreach events and shared their views and experiences so openly.
We also thank them for constructively challenging the people who make decisions that affect everyone in the UK.
We look forward to having more conversations in the year ahead.
Denise Bentley, Chief Executive, First Love Foundation (Greater London)
Bridget Blow (West Midlands)
Jonathan Cheshire (Central Southern)
Sarah Green, Chief Executive, NewcastleGateshead Initiative (North East)
Julie Hawker, Chief Executive, Cosmic (South West)
Ruth Marks, Chief Executive, Wales Council for Voluntary Action (Wales)
Ross Martin, Chair, Forth Valley College (Scotland)
Josephine McCartney, Chief Executive, Kent Community Foundation (South East)
John McMullan, Chief Executive, Bryson Charitable Group (Northern Ireland)
Dame Susan Rice, Chair, Financial Services Culture Board (Scotland)
Caroline Taylor, Chief Executive, Essex Community Foundation (South East)
Martin Traynor (East Midlands)
Romesh Vaitilingam, Editor-in-Chief, Economics Observatory (South West)
Summary of discussion themes
The cost of living squeeze has affected everyone. But the impact has not been felt equally. Some people have been able to manage the effects of rising prices more easily than others.
In the early part of 2022, most of the people who took part in our forums were mainly concerned about the impact of rising inflation on those on lower incomes. For the more comfortably off, personal finances were less of a worry. Energy bills were rising following Russia’s invasion of Ukraine and the cost of the weekly shop was going up. But it felt manageable. Especially for those who had been able to build up savings during the pandemic.
As the year progressed, the picture began to change. A broader range of people told us how they were feeling the effects of higher inflation and had changed their spending habits. Some were cancelling subscription services, eating out less, or delaying (or even cancelling) big spending decisions. Many switched grocery brands to value ranges or other cheaper alternatives. Almost everyone said they were trying to keep energy costs down by, for example, not turning on the central heating for as long as possible.
Panel members who were on lower incomes said their already precarious financial situation was made worse by higher inflation.
People told us they were struggling to afford essentials such as food, energy, fuel, and housing. Those on low or fixed incomes such as Universal Credit or state pensions were particularly badly affected. As were people with healthcare issues, disabilities, and caring responsibilities.
These trends were confirmed by charities and community groups at our community forum events. Many organisations providing services such as food and debt advice saw a big rise in demand. They also saw the profile of their service users change. For example, they began to include more people who were in employment.
- A member of the North West panel of our citizens’ forum at a meeting in Liverpool.
People often had to make difficult choices. For those unable to work from home because of the nature of their jobs, rising transport costs made decisions about whether to work or not more finely balanced. Some had decided to stop work, or to work fewer days. In contrast, others were working longer hours or taking second or third jobs to cover rising costs. Charities told us they were finding it hard to hold on to staff who could find easier work elsewhere for higher pay.
We heard concerns about the intergenerational effects of inflation. For example, older members felt an impact on their private pensions. Rising costs eroded their savings, leaving them to reduce the amount they drawback, or delay their retirement plans. Some had returned to work to bolster their incomes. That was made easier because of the high level of vacancies in some areas, although there were often complaints about the quality of work on offer, and rates of pay.
At the other end of the age spectrum, research by the youth forum and student attendees at panel events revealed the pressures on young people. More than half of those surveyed by the forum worried about their current earnings and future income prospects. Students, meanwhile, told us their loans were increasingly stretched even to cover just the basics. Some were taking on additional jobs or hours to supplement their incomes. Others were considering whether they could afford to continue their studies.