Eat Out to Help Out propels inflation to nine-year high

Figures show that consumer prices rose by 3.2% in the 12 months to August 2021, up from 2% in July. 

The 1.2 percentage point rise in the annual rate of inflation in the space of a month marked the sharpest such increase since detailed records started in 1997.

According to the ONS, the increase was due to the discounts seen across the hospitality sector last August under Chancellor Rishi Sunak’s month-long Eat Out to Help Out scheme, which offered customers half-price food and drink to eat or drink in (up to the value of £10) between Mondays and Wednesdays.

Because Eat Out to Help Out was a short-term scheme, it added that the upward shift in the August 2021 12-month inflation rate is likely to be temporary.

Elsewhere there was also likely to have been some impact from the supply chain crisis on inflation last month, which it said helped push up food and non-alcoholic drinks prices.

Jonathan Athow, deputy national statistician at the ONS, said: "August saw the largest rise in annual inflation month on month since the series was introduced almost a quarter of a century ago.

"However, much of this is likely to be temporary as last year restaurant and café prices fell substantially due to the Eat Out to Help Out scheme, while this year prices rose.

"Food and non-alcoholic drink prices rose by more than last year, which also helped push up the rate."

The Eat Out to Help Out scheme, which was introduced by the Chancellor to boost consumer spending and confidence after the first national lockdown, was hailed a success by the hospitality sector, with a large majority of businesses saying it led to a boost in trade​​.