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IMF urges targeted, temporary support for poorer households during cost-of-living shocks

In a newly published chapter of its world economic outlook, the IMF says governments should protect poorer households from price spikes with temporary, targeted income support rather than broad measures such as tax cuts or price caps. UK outlets link it to PM Andy Burnham's cost-of-living pledges and the Budget.

2 outlets · 0L · 1C · 1R First reported Account updated
Image: Evening Standard
Image: City A.M.

1 / 2

The story, neutrally told

Mixed · 2The International Monetary Fund said governments should prioritise targeted support for low-income households over broad-based measures when the cost of living surges. Centre · 1The advice comes in a newly published chapter of the IMF's world economic outlook; the full report is due next week. Mixed · 2The IMF said price shocks for basics such as food, transport and energy, like those after Russia's 2022 invasion of Ukraine and this year's escalation of conflict in the Middle East, weigh most on lower-income families, who spend a larger share of their budgets on essentials, and that even temporary spikes can have lasting effects.

Mixed · 2It called targeted and temporary measures the "most effective and cost-efficient way to protect poorer households when prices for the basics spike", and said help should go mainly through income support for the most vulnerable, ideally via existing social protection systems that can be scaled up rapidly. Mixed · 2The IMF contrasted this with broad measures such as tax cuts, price caps and generalised subsidies. According to the Evening Standard, it said support may need to extend beyond the poorest in "exceptional circumstances", such as significant food security concerns or risks of social unrest. Mixed · 2Both outlets tie the report to UK politics: Prime Minister Andy Burnham has pledged cost-of-living help and has cut VAT on energy bills and capped bus fares at £2. The Evening Standard adds a cut in business rates for pubs, social clubs and live music venues.

Right · 1City A.M. reports that the Iran war threatens Chancellor John Healey's Budget next month: EY researchers say the war has narrowed his fiscal headroom to £11bn and could erase it. It also cites UK inflation rising from 2.9 to 3.1 per cent in August and industry warnings that food inflation could pass six per cent by next summer. Right · 1City A.M. says the report may spark debate about the UK's welfare bill, and quotes former Bank of England chief economist Andy Haldane, who said the government is fiscally "skating on pretty thin ice" and should show it is willing to cut public spending.

Every sentence links to the reporting it rests on. The pill in front of each says where its sources sit: Left, Centre or Right when one side supplies at least half of them, Mixed when they are evenly split. The number is how many outlets it cites.

Left0 outlets

No left outlet in our sources has covered this story yet.

Centre1 outlet

Framing
Straight report of the IMF findings, with a brief UK link to Burnham's cost-of-living measures.
Emphasis
The IMF's reasoning, the exceptions for food security or social unrest, and the IMF's membership.
Leaves out or plays down
Leaves out UK fiscal constraints and the welfare-bill debate.
For example
“Cost-of-living crises weigh heavier on poorer families and erode the affordability of everyday essentials” — Evening Standard

Right1 outlet

Framing
Presents the IMF advice as a welfare-spending call and places it within UK Budget and fiscal-pressure worries.
Emphasis
Welfare spending, EY's £11bn headroom estimate, rising inflation and Haldane's call to cut public spending.
Leaves out or plays down
Does not mention the IMF's exceptions for food security or social unrest.
Charged language
“skating on pretty thin ice”“Achilles’ heel”“in hock”
For example
“Governments should spend more on welfare to tackle cost of living, says IMF” — City A.M.
“Achilles’ heel of this government” — City A.M.