Millions of families are at risk of falling into poverty as prices rise faster than wages, a leading think tank warned in a report published on Wednesday.
The Joseph Rowntree Foundation (JRF) said the cost of living could be ten percent higher by 2020 while wages stagnate, endangering families who are just about managing.
The report also revealed that 19 million people are struggling to maintain decent living standards, a rise of four million since the financial crash.
Those living below the Minimum Income Standard - the earnings, defined by the public, that are needed for a decent standard of living - soared from 15 million to 19 million between 2008/9 and 2014/5.
Shadow Work and Pensions Secretary Debbie Abrahams said the findings were a “result of this Government’s seven wasted years of austerity”.
Theresa May vowed to help families who were “just about managing” in her first speech as Prime Minister in July.
In his November Autumn Statement the Chancellor Philip Hammond pledged to increase the national living wage from April, in a move aimed at helping such families.
But Campbell Robb, Chief Executive at JRF, warned that the UK was approaching a “difficult time for just managing families as rising inflation begins to bite into finely-balanced budgets”.
“If the cost of essentials such as food, energy and housing rise further, we need to take action to ease the strain. The Government can help in next month’s Budget by allowing families to keep more of their earnings and ensuring benefits and tax credits keep up with the rising cost of living,” he said.
“These stark figures show just how precarious life can be for many families.”
Labour MP Abrahams called on the Tories to reverse cuts to in-work support that she said “will see some working families worse off by £2,600 a year”.
A Government spokesperson said: “We’re determined to build an economy that works for everyone and we are taking decisive action to help with the cost of living.
“A million workers have had a pay rise thanks to our National Living Wage, and we have delivered the fastest wage growth for the lowest paid in 20 years, taken millions of people out of tax altogether and frozen fuel duty for seven years in a row.”