This report has been produced by a cross Scottish Government group of analysts. The group was set up in May 2022 to bring together evidence on the emerging crisis and use evidence to appraise policy options and support cross government decision making. This report expands on a more detailed and comprehensive report published by the group in November 2022 to present a more up to date assessment of the cost of living crisis and its emerging legacy in Scotland.
Key points:
- The cost of living crisis has presented serious economic and social challenges for Scotland and the UK, and has had a detrimental effect on businesses, communities, households, public sector budgets and the delivery of key public services.
- While the cost of living crisis affected everyone, some households, services and sectors of the economy were much more exposed to rising prices. Low income households were, and continue to be, particularly adversely affected. They were more financially vulnerable entering into the crisis, were subject to higher rates of inflation than better off households in the earlier, acute phase of the crisis, and often pay more for essential goods and services.
- Women, disabled people, ethnic minorities, rural households, larger households, young people, students and carers, lone parents and single person households, households in receipt of income-related benefits, people narrowly ineligible for benefits, and people with no recourse to public funds were particularly adversely affected. Some households will have a number of these intersectional characteristics, potentially compounding disadvantage.
- The cost of living crisis is likely to have increased the demand for public and third sector services at the same time as increasing the cost of delivering services.
