Why is the cost of living still so high in Scotland?
War and the pandemic pushed prices up. That is true. It is also true that political choices left ordinary families with less protection — and added avoidable costs of their own.
By Graeme · 1 August 2026 · 10 min read
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The crisis did not end when the inflation number came down. Prices went up sharply. Most of them stayed up. Now they are rising from that much higher starting point.
About 34%
rise in everyday household costs over five years for people on low incomes
ONS Household Costs Index, five years to March 2026: 33.9%. These figures are official statistics in development.
What is happening now
In June 2026, the main UK inflation rate was 2.6%. That sounds as if the problem has gone away. It has not. It means a basket that already became far more expensive was still getting another 2.6% dearer over the year.
Lower inflation does not mean lower prices
Think of a car slowing down. It is still moving forward. Inflation slowing means prices are going up more slowly; it does not rewind the food shop, rent or power bill to 2021.
This hits people on low pay hardest because there is less that can be cut. A better-off household can delay a holiday or save less. A family already buying the cheapest food cannot stop buying dinner, heating the home or paying the rent.
Food
The weekly shop rose fast, then stayed expensive.
Energy
Gas and electricity jumped, and standing charges kept landing.
Housing
Rent and mortgage costs carried on rising after the worst inflation passed.
The detailed guides explain why food stays expensive when inflation falls and why the energy price cap is not a maximum bill.
What started the crisis
Two big shocks were real, global and outside the control of any Scottish MP.
- The pandemic jammed up supply. Factories shut, shipping backed up and materials became harder to get just as economies reopened and demand returned.
- Russia's invasion of Ukraine sent energy and food costs soaring. Europe paid much more for gas. Grain, fertiliser and transport costs rose too.
The Bank of England then raised interest rates to slow price rises. That was its job under the inflation target set by government, but the medicine hurt: mortgages, borrowing and eventually rents became more expensive.
So no, MPs did not cause a pandemic or start the war in Ukraine. But that is not the end of the story. Governments choose how protected people are before a shock, what extra costs they add, and how quickly help catches up.
The choices that made it worse
These are the avoidable parts. Each one has a date, a decision-maker and a public record. They are not all the work of the same party, and they did not all cause the original inflation. They did make ordinary households less able to cope with it.
UK Government and MPs · 2016–2020
They froze working-age benefits before prices exploded
Universal Credit rates, Child Benefit and other working-age support were held at the same cash amount for four years. Prices kept moving. The safety net became worth less before the biggest price shock in forty years arrived.
The record: The Welfare Reform and Work Bill passed its final Commons division by 309 votes to 274. Independent JRF modelling put the real-terms loss at 6.5% by 2019.
UK Government · October 2021
They removed £20 a week from Universal Credit
The increase had been introduced during Covid. The Government chose not to keep it, despite warnings from committees in all four UK nations. This was not a Commons vote that directly cut the payment; ministers let the temporary increase end.
The record: The temporary uplift was allowed to expire in October 2021. That was £1,040 a year from affected households.
UK Government and regulators
They allowed avoidable costs to build up in food and energy
Brexit did not cause all food inflation, and failed energy firms did not cause the global gas spike. But new trade barriers added friction to food imports, while weakly financed energy suppliers collapsed and their costs were passed back to customers.
The record: LSE researchers estimated post-Brexit food barriers added about £250 per household by March 2023. The NAO said weak Ofgem licensing and monitoring increased the £2.7bn cost of supplier failures.
Truss Government · September 2022
The mini-budget poured panic into the mortgage market
Interest rates were already rising. The mini-budget did not create the whole mortgage squeeze. But announcing around £45 billion of tax cuts without an OBR forecast made a bad market much worse, fast. Most of the plan was then reversed.
The record: The Commons Library records a UK-specific part of the market shock, sharply higher gilt yields and substantially higher mortgage offers after the announcement.
UK Government · still in force in 2026–27
Rent support is frozen while rents keep moving
Local Housing Allowance limits how much Universal Credit can help a private renter with rent. It was reset in April 2024, then frozen again. The present UK Government has continued that freeze through 2026–27. See the current Scottish rates and the Greater Glasgow shortfall.
The record: The 2026–27 Local Housing Allowance tables carry forward the April 2024 cash rates and explicitly leave newer 2025 rent evidence out of the calculation.
Conservative and Labour UK governments
Frozen tax allowances quietly take more from wages
When pay rises but the tax-free allowance does not, more of the wage is taxed. That is called fiscal drag. Conservatives introduced and extended the freeze; Labour extended it again. Scotland sets its own income-tax bands, but Westminster still controls the tax-free personal allowance.
The record: The personal allowance has stayed at £12,570 since 2022–23. The November 2025 Budget extended the freeze to 2030–31.
Scottish Government · 2024–25
Holyrood cut affordable-housing money during a housing emergency
Westminster does not control every part of this. Housing is devolved. The Scottish Government cut the affordable-housing programme, then restored it after pressure and extra funding. Putting money back was right; making the cut in the first place was not.
The record: The Scottish Parliament research service records a 25% real-terms fall in the programme for 2024–25. Funding rose by 32% the next year, but the building pipeline had already been hit.
Why Glasgow feels it harder
£1,094
average monthly advertised rent for a two-bedroom home in Greater Glasgow in 2025
Up 94% since 2010, compared with 54.7% general UK inflation over the same period. Scottish Government private-rent statistics.
That rent figure mostly reflects homes being advertised or newly let. It is not what every existing tenant pays. It still shows the price facing somebody who needs to move today.
Glasgow entered the crisis with more people already on low incomes, worse health, and a much higher child-poverty rate than most of Scotland. The same £20 increase hurts more when there was only £10 spare in the first place.
A worker aged 21 or over on the legal minimum of £12.71 an hour, paid for 37.5 hours every week, earns £24,784.50 gross a year. The Joseph Rowntree Foundation found that full-time minimum-wage pay covered only 76% of what a single adult needed for a basic acceptable living standard in 2025. For a lone parent with two young children it covered 69%. See the full minimum-wage take-home calculation.
This is why 'get a job' is not an answer
The shortfall can exist before a person misses a shift, buys anything unusual or makes a bad choice. The legal wage floor itself can leave a full-time worker below what ordinary life costs.
Decisions that did help
Government choices can lower the pressure too. The UK energy guarantee stopped the first shock landing in full. In Scotland, the Scottish Child Payment puts £28.20 a week per child into low-income households; Scottish Government modelling estimates it keeps 40,000 children out of relative poverty in 2025–26.
Holyrood also restored affordable-housing funding in 2025–26, and the UK Government has now abolished the two-child limit. Those facts matter because accountability is not about pretending every decision failed. It is about keeping the useful choices and reversing the damaging ones.
Who can fix what
Your MP at Westminster
Universal Credit, Local Housing Allowance, the legal minimum wage, the tax-free allowance, energy-market rules and most of the big economic decisions.
Your MSP at Holyrood
Scottish benefits, housing, rent rules, childcare, Scottish income-tax bands and much of public transport.
Your council
Council tax, local housing and homelessness help, crisis grants, schools and many of the services people rely on when money runs out.
Ask the right people what they will change
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Find them and write my emailsWant to inspect the proof first? Every source used here is listed below. You can also see which changes would make the biggest difference and how this site checks a claim.
