Andrew Griffith is the shadow Chancellor of the Exchequer. 

Everyone has got their own favourite hot take on last week’s US mid-term elections.

The data doesn’t lie – or at least it lies a great deal less than some politicians – and the ‘cost of living’ according to US exit polls reported by Reuters was cited by 90 per cent as a crucial or major factor in their vote.

James Carville, Bill Clinton’s election strategist, distilled political campaigning into four immortal words: “It’s the economy, stupid.” That was true last week in the US, and we can be confident that the figures would be similar here.

After John Healey’s Budget, polling by Ipsos revealed that 80 per cent of respondents believe the British economy is in poor condition and 67 per cent went on to say that they were not confident that the Budget tackles long-term economic problems. Earlier ONS surveys said the top three worries were the cost of food shopping, fuel prices and gas or electricity bills.

At the next election, the likely winner is the party that best answers the question: how will my family and I have a decent life?

Three years into this Labour government (and never let them try to get away with pretending that it is anything other than that), the Prime Minister and Chancellor are comfortably failing that test. Whilst Labour understands that the cost of living is a concern for voters, they are boxed in from responding adequately by its high-tax, big-spending policies and the vested interests of trade union barons.

Relieve the tax burden on hard-working households? Nope.

Those burgeoning public sector workers aren’t going to pay for their own four-day working week. Slash net zero subsidies, carbon tariffs and gold-plated red tape? Ed and Miatta say no. Unleash a productivity revolution using AI to radically lower the cost of public transport as many other countries safely do? The transport unions will be holding up a big stop sign. Lower tariffs and embrace free trade? Are you kidding. And anyway, we’ve promised to hand those powers back to Brussels. And so on.

Instead, the government’s response is a masterclass in distraction. A few headline one-off savings, temporary measures that unwind almost as soon as they appear, and neutral reallocations such as between the unit rate and standing charges for gas.

The truth is there in the small print. Analysis published by the Office for Budget Responsibility in the recent Budget confirms that even combined, Labour’s so-called cost-of living measures will reduce the increase in inflation in 2027 by just 0.1 percentage points.  That’s a barely perceptible one-tenth of one per cent – entirely within the margin of error. Meanwhile, inflation is running at 3.5% a year and forecast to continue increasing. One consequence was this week’s Bank of England interest rate hike which will further reduce the living standards of millions of mortgage-payers.

As the great free-market economist Milton Friedman observed: “The government solution to a problem is usually as bad as the problem.” Indeed, it frequently makes matters worse.

There is in any case something fraudulent about a state that taxes and regulates families and businesses into higher costs and lower household incomes, then congratulates itself for distributing a fraction of the proceeds back to consumers. It’s like someone stealing your laptop and then expecting gratitude for returning the charger.

Hard-working people don’t want to depend upon a government press release about gherkins or bus fare caps for a better standard of living. They want to earn more, keep more of it, and make the decisions about where to spend it for themselves. These are Conservative instincts and represent a fundamental divide between us and the current Labour government.

Instead, our Conservative economic plan will cut the cost of living by tackling the taxes, regulations and restrictions that make everyday life unnecessarily expensive. In short, we want less government and to relieve the costly burdens it imposes.

Few things bring home the cost of living more vividly than the number that appears when the weekly food shop is totalled at the supermarket checkout. Yet unseen, the single largest element of that cost is the embedded employment cost of every employee who has produced or handled each item. The Centre for Policy Studies estimates that for someone aged 18-20 working full-time on the minimum wage, the cost has increased by 31 percent, or £4,859 per year in the first three years of this government due to higher National Insurance rates, thresholds and increases in the minimum wage that are far ahead of inflation. No one begrudges workers fair pay, but in low-margin businesses like retail or hospitality, the inflated cost is passed straight back onto shoppers. That £4 flat white? Likely at least £1.50 of that is the cost of the barista, and if that goes up, so does the price of your favourite shot of caffeine.

The Bank of England itself has acknowledged how higher employment costs, energy prices and additional packaging obligations have contributed to food inflation.

Applying the principles that Kemi set out in ‘The Right Way’, Conservatives would cut the cost of the weekly shop by reducing the cost of employment. We would halve the ‘jobs tax’ on workers aged 21 to 24, and repeal Labour’s red tape ‘Unemployment’ Act which drives up the cost, and the risk of hiring.

We would also scrap the £1.5 billion packaging tax – sometimes called the Grocery Tax – and cut business rates for smaller high street businesses.

ConservativeHome readers will know how Britain has burdened itself with some of the most expensive electricity in the developed world. Our Cheap Power Plan addresses this and would feed into genuinely lower everyday prices. We will embrace nuclear power, accelerate infrastructure development and make affordable energy a national economic priority.

Recall how the ‘Bigly’ loser in this week’s US mid-terms had made raising tariffs – ultimately paid by ordinary US households – the centrepiece of his economic policy. Whilst our Prime Minister ironically used a Brexit freedom to lower tariffs on gherkins, his government is, in general, much closer to the ‘Trump playbook’, seeking to rejoin the tariff-loving EU bloc and imposing expensive carbon tariffs which will drive up the cost of everything from fertiliser, to the glass jar that gherkins are sold in. Already, Labour’s soaring tariffs on imported steel and aluminium are doubling the cost of some manufactured items.

It is my job, working with the Conservative Economic Team and Kemi Badenoch as Leader, to deliver the plans and policies to help us win the next general election.

‘Cheaper energy, fewer regulations, lower taxes and making hiring affordable again’ is a clear and proven plan rooted in Conservative principles that will reduce the cost of living and make our country more prosperous. Labour and the other parties are incapable of doing the same, so let us take confidence from last week’s US mid-terms that in volatile political times, winning on the economic agenda is the road to winning big at elections.