Rachel Reeves’ claim that Brits will be £1,000 better off have been blown apart after new analysis shows incomes growing by just £40. Joseph Rowntree Foundation (JRF) modelling shows under Labour annual household disposable incomes are projected to grow by £40 to the end of the current parliament in 2029.

The charity said growth of £40 was “simply not enough” and urged the Government to focus on driving up living standards so struggling families start to feel better off. JRF estimated incomes would fall by £580 from April this year until April 2029. The figures differ sharply with the £1,000 increase the Chancellor detailed over this parliament during her Spring Statement on Tuesday (March 3).

JRF put the difference down to its analysis focusing on households and accounting for actual housing costs at 2025-26 levels. It said this made its inflation-adjusted figure a more accurate reflection of whether families will feel better off.

Ms Reeves said the average family will be £1,000 better off by 2029. She based that on Treasury calculations of real household disposable income (RHDI) figures showing what families have left after adjusting for inflation and taxes.

Her figures were published in the Office for Budget Responsibility’s (OBR) economic and fiscal outlook.

Chris Belfield, JRF’s Chief Economist, said: “The Government is right to focus on families’ incomes and the sustained pressure they’re under from the cost of living through actions like removing the two-child limit from Universal Credit and reducing the cost of energy bills. In an increasingly uncertain world, having enough set aside to withstand any potential shocks is even more important.

“But £40 growth over the course of five years is not enough. It should not be too much to ask for families who have been struggling for years to start to feel better off. We will never have a stronger economy if families don’t feel more secure and able to take each and every opportunity to improve their lives.

“The Government needs to focus on driving up living standards so families can feel the change day to day. This needs action across all aspects of government to bring down people’s costs and boost their incomes.”

Sean Drury of Blick Rothenberg told The Times OBR forecasts are “notoriously incorrect”. He added: “The £1,000 per year is from the more optimistic end of the forecast, basically saying real GDP per capita improvements will flow down into household incomes through this being distributed fairly into families through wage growth above inflation and cost of living.”

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JRF cautioned that “significant” changes to the OBR forecasts and its own modelling are possible due to the economic impact of the war between the US, Israel and Iran.

In its response to the Chancellor’s Spring Statement, the Resolution Foundation thinktank said the UK’s immediate economic future is “highly uncertain”.

It said said while the UK is in for a strong year of living standards growth, especially for lower-income families, the lengthier economic outlook is “bleak”.

Chief Executive Ruth Curtice said in a statement: “The immediate economic outlook for Britain is highly uncertain, with yesterday’s forecasts already looking out of date, while the living standards picture for the rest of the Parliament is very lopsided.

“This coming year is set to be a decent one for living standards, and a bumper one for poorer families, as wages and benefit support rise above the level of inflation. But a fresh energy price shock risks puncturing this good news.

“With wage growth set to tail off, the living standards picture for the rest of the Parliament is bleak.”

Ms Reeves said on Tuesday her fiscal plan was “more necessary than ever before in a world of uncertainty” with the conflict in the Middle East threatening economic stability.

The Office for Budget Responsibility indicated gross domestic product will increase by just 1.1% in 2026, down from the 1.4% it forecast in November. The watchdog upgraded its forecasts for 2027 and 2028 from 1.5% to 1.6%.

The Chancellor’s statement did not include any tax and spending changes, after Ms Reeves committed to delivering just a single budget a year.

But she indicated she would make a more significant speech later this month, including setting out her goal for closer trade ties with the European Union.

HM Treasury has been approached for comment.