Labour: UK rate of inflation matched only by that of Estonia

Rachel Reeves, Labour's shadow chief secretary to the Treasury, responds to figures showing inflation at a new high.

"It's now clear we have the worst of all worlds – high inflation, rising unemployment and a stagnant economy since last autumn. When Britain now has the highest inflation of any EU country except Estonia, families and pensioners feeling the squeeze want out of touch ministers to take some responsibility and take action now.

"January’s mistaken VAT rise has fuelled inflation and should be temporarily reversed to ease the squeeze on families and kick-start the economy. This would give a couple with children an average boost of £450 a year and is part of Labour's five point plan for jobs and growth. The government also needs to do much more to stem soaring energy bills, especially when families are already being hit by the VAT rise and pensioners will get a lower winter fuel allowance this year.

"The Bank of England has been put in an impossible position by George Osborne. It has been left to do all the work to support the economy, while spending cuts and tax rises that go too far and too fast have crushed growth and the VAT rise has fuelled inflation too.

"We need an emergency budget for jobs and growth now because with every day that passes when ministers just sit on their hands living standards are squeezed harder, more businesses go bust and hundreds more people join the dole queue."