HOUSEHOLD budgets are still taking a battering, trade union leaders warned today after inflation unexpectedly rose for the first time in a year.

Figures from the Office for National Statistics (ONS) showed consumer prices index inflation rate rose to 4 per cent in December, up from 3.9 per cent in November, marking the first increase since February last year.

The shock rise was largely driven by last November’s tax hike on tobacco, higher alcohol prices and air fares.

It came just hours after Prime Minister Rishi Sunak claimed the government had met its pledge to halve inflation and claimed that “it has continued to fall.”

Chancellor Jeremy Hunt insisted that “inflation does not fall in a straight line, but our plan is working and we should stick to it.”

He claimed that the inflation risk posed by tensions in the Red Sea was one of the reasons for Britain’s military strikes against Houthi targets.

But TUC general secretary Paul Nowak said the Tories have “delivered a decade of dismal economic growth,” which has “hit pay packets and household budgets hard.”

He said: “After 14 years of stagnating living standards, you’ll struggle to find many people who feel any better off. Prices are still going up, with inflation at double the Bank of England’s target.

“And whether it’s covering the weekly shop or paying the bills families remain under the cosh. If real wages had grown at their pre-crisis trend, the average worker would be earning around £15,000 a year more.”

Shadow chancellor Rachel Reeves said that any rise in inflation was “bad news for families who are worse off after 14 years of economic failure.” 

“Prices are still rising in the shops, with the average weekly shop £110 more than it was before the last general election, and the average family set to be £1,200 worse off under Rishi Sunak’s tax plan,” the Labour MP said.

Consumer website Which? warned that the rise could trigger a new wave of “completely unacceptable” price hikes from broadband and mobile providers, just 12 months after many firms imposed rises of more than 14 per cent on customers.

Which? director of policy and advocacy Rocio Concha said: “It would be completely unacceptable for providers to follow BT and inflict another above-inflation increase on customers after Ofcom proposed banning this practice, saying it causes substantial consumer harm.”