It's a simple question, and it will be at the heart of the general election campaign. After 14 years of Conservative rule, people are asking: “Am I better off now?”
income
For most people, the answer is no, not better. Wages have fallen in real terms – that is, after taking into account inflation, including housing costs. From 2010 to 2019, wages across the UK fell by 0.1% per year. Since the pandemic began, the situation has improved, but workers are still earning thousands of pounds less than they would have if their incomes had risen in line with inflation.
The living wage (previously the minimum wage) has risen from £5.93 to £11.44 an hour for people over 21. But the Resolution Foundation said cuts to working-age benefits have offset the gains for many people. Over the past decade, it said, low-paid families with children on benefits have seen their incomes barely rise or even decline.
Personal tax allowances – the amount you can earn tax-free each year – were increased rapidly during the Coalition government, allowing 3.4 million low-income earners to keep their full income, but from 2021 onwards this threshold has been frozen, meaning people who received a pay rise aren't feeling the benefit as much as they would have if they hadn't.
Despite this year's cuts to National Insurance contributions, some people will still be worse off than they would be if the contribution threshold had risen for inflation. When the Chancellor announced the latest cuts, the Resolution Foundation said people earning up to £19,000 would still be worse off. It said those earning £50,000 would benefit most.
housing
While some homeowners have seen significant increases in property values, getting onto the home buying ladder has never been harder.
According to the Nationwide Building Society, the average price of a house in the UK was £169,162 in May 2010. In April this year it was £261,962.
While the housing market in much of the country had been sluggish for several years after the 2008 financial crisis, low interest rates had propped up prices in London. Prices had been rising elsewhere even before the pandemic, and the scramble for space and stamp duty exemptions after the housing market was temporarily shut down have added fuel to the fire.
Low interest rates have enabled many people to afford their mortgages, and the latest England Housing Survey for 2022-23 showed that 35% of households owned their home outright and 29% had a mortgage. In 2010, the number of people with a mortgage outweighed the number of people who owned outright.
But mortgage costs have fallen from record lows — some borrowers could lock in less than 1 percent for two years — to levels not seen since before 2008.
Those not yet on the home-buying ladder are struggling to afford it: The price of a typical first-time home buyer is now 5.2 times the buyer's income, up from 4.6 in 2010, says Robert Gardner, chief economist at Nationwide. Monthly payments are 39% of a homeowner's take-home income, “which is well above the long-term average,” he says. For much of the past 14 years, it was 29.30%, but rising interest rates have changed that.
The goal of building 300,000 homes per year has not been met.
Children and Youth
The last 14 years have been bleak. Within weeks of coming into power, the Conservatives abolished the Child Trust Fund, a scheme planned by Chancellor Gordon Brown to help families save for their children. Children were given a minimum of £250 to save until they turned 18. The Institute for Fiscal Studies concluded that the accounts made a big difference to 18-year-olds' wealth, but with average savings of £650, it had no impact on whether they could afford higher education or a down payment on a house.
In January 2013, the government changed the child allowance system so that high-income families were no longer eligible for the allowance.
In England, tuition fees were capped at £3,290. In December 2010, the coalition government tripled the cap to £9,000, which students started paying from September 2012. Since 2017, it has been £9,250.
Childcare costs are rising faster than inflation: the average price for 50 hours of care across the UK for a child under two will be £285 a week by 2023, more than 30% higher than a decade ago, according to the charity Coram.
Childcare vouchers were replaced with tax-free childcare services in 2017, but many parents are missing out, said Laura Suter, director of personal finance at consulting firm AJ Bell. The government has paid out less than half what it had expected. She said many people are put off by the name of the scheme.
senior citizen
Older people, especially women, have seen their incomes rise thanks to the new state pension and the “triple lock” introduced by the coalition government to ensure state pensions keep up with inflation and earnings.
But Helen Morrissey, head of retirement analysis at finance firm Hargreaves Lansdown, said the data showed that after deducting housing costs and allowing for inflation, pensioners would receive a weekly salary of £387 in 2022/23, compared with £371 in 2010. “That's not a massive increase over that period,” Morrissey said.
Older people have the most savings, but for many years they have not been able to earn as much interest on their savings. In 2010, the average interest rate on savings of £10,000 was 0.78%, according to MoneyFacts. Interest rates have risen so that it is now 3.11%. Savers will feel good about the recent rise in interest rates, but borrowers will not.
invoice
Council tax bills are rising but central government cuts mean many taxpayers are getting less. In 2010-11 the average bill for a D-rated home in England was £1,439. This year it is £2,171.
However, between 2010-11 and 2019-20, the amount spent by local authorities on all services fell by 10.4%. Bus route mileage fell by 14% and a third of libraries in England closed.
Grocery prices in Britain fell for several years as discounters opened more stores and forced established supermarkets to cut costs. Official figures show prices fell in 2014, 2015 and 2016. Prices also fell during the pandemic. But the trend has since reversed, with prices rising more than 19% to peak last spring.
Electricity prices have remained fairly stable over the past few years – the average spend on electricity was £451 a year in 2010, rising to £1,274 last year – while gas has risen from £520 to £1,304.
The sudden rise in prices in 2021 has forced many suppliers out of business and wiped out most of the cheapest rate plans.
Research from the London School of Economic Performance Centre has found that Brexit is also contributing to other cost pressures: a report published last May estimated that Brexit could cost every household £250 since December 2019, just considering the impact on food.
A report from the House of Commons Library found that headline inflation over the past three years has been higher in the UK than in France.