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Yesterday you will have heard some news about inflation, today you may have seen what the Bank of England has announced with interest rates and I鈥檓 sure that actually fills many of you with some anxiety and some concern about what鈥檚 going on and what does that mean for you and your families.

I am here to tell you that I am totally, 100% on it, and it is going to be okay and we are going to get through this.

That is the most important thing I wanted to let you know today. You should know, and I know this won鈥檛 make it any easier, but what we鈥檙e grappling with here is something that many countries around the world are all grappling with at the same time as we are right now. So, if you look at interest rates in Australia, in Canada, in New Zealand, across the world, they are all at high levels. Actually, interest rates in Europe are the highest they鈥檝e been for twenty years, because they are all grappling with inflation in the same way that we are. Many of you may have friends or family in those places and if you spoke to them they鈥檇 tell you the same thing.

Now, that doesn鈥檛 make it any easier, of course I know that, but it鈥檚 important for you to know we鈥檙e not alone in dealing with this. I know how important this is and that鈥檚 why at the beginning of the year I made a speech and I set out my five priorities for the country that I wanted to deliver as your prime minister. The first of those was to halve inflation. I know how important this is. That鈥檚 why I set it as my top priority. It鈥檚 not easy. Rooting out inflation is not easy.

It requires difficult decisions. It doesn鈥檛 happen overnight. But, if we don鈥檛 get on top of it, it would just get worse and it would last longer and that鈥檚 not going to do anyone any favours, it鈥檚 not going to be good for you and your families in the long run and, even though it means I have to make some difficult decisions, that鈥檚 the type of prime minister I am, because I want to do the right thing for your and your families in the long-term.

Now, why does inflation matter, why did it matter to me, why did I set it as my top priority? It鈥檚 pretty simple. It鈥檚 because inflation eats into the pounds in your pocket. It鈥檚 as simple as that. It makes us, everybody, poorer.

It means prices go up. It means your savings get eroded. It puts jobs and livelihoods at risk and that鈥檚 why it鈥檚 so important that we target it and get it down. That鈥檚 why I said I wanted to halve it on its way to getting it back down to 2% where it belongs. I am absolutely confident that if we hold our nerve and stick to our plan, we will do that, and you should feel the same confidence that I do, because we are going to get through this and we鈥檙e going to get this done.

Now, why do I feel confident? What is that plan I鈥檓 talking about? Well, three parts to it.

The first is I鈥檝e got to make sure government is doing everything that it needs to do and that means being responsible with our borrowing, because we cannot in a situation like this borrow too much money, because that just makes everything worse. That means, much as I would love to, I鈥檇 love to cut your taxes tomorrow, you鈥檇 love that, I鈥檇 love that, of course I would, but that鈥檚 hard to do, because it means I鈥檇 have to borrow more money to do it. Another thing is I can鈥檛 say yes to every single thing that people want me to spend more money on, because that would mean we鈥檇 have to borrow money to do all of that. That means I have to make some difficult choices, I have to prioritise, the same as all of you do in your household budgets, I have to do the same thing too.

It means when we鈥檙e trying to figure out how we pay all our fantastic public sector workers, I need to think about what鈥檚 affordable, what鈥檚 responsible, again so I can manage our borrowing. Now, none of those things that I talked about are easy. Those are all difficult decisions that I have to make, but if I just gave into the easy thing every time, that would just mean more and more government borrowing.

That just puts fuel on the fire, makes inflation worse, pushes up interest rates even higher. So even though it鈥檚 tough for me in the short-term, doesn鈥檛 make my life easy, anyone who tells you that it would be easy isn鈥檛 being straight with you. I want to be straight with you, that means I do have to make these difficult decisions, but that鈥檚 the right thing to do. It鈥檚 the right thing to do for you and your families in the long run and that鈥檚 why I鈥檓 going to stick to the course and manage our borrowing.

Now, the second part of the plan is making sure we tackle all those areas where inflation is particularly bad. Energy is an obvious one. The bills that you鈥檝e had to pay over the last year have been extraordinary.

Absolutely extraordinary, never seen anything like it. Now, I鈥檓 pleased they鈥檙e going to be starting to come down. Bills are going to come down about 430 quid starting in July, that鈥檚 good news. Hopefully we are over the worst of this and they will keep coming down after that. But that鈥檚 just now, we need to make sure this doesn鈥檛 happen again and that they keep coming down.

That means we need to have more energy, so we are investing more in renewable energy like offshore wind, building new nuclear power stations, but also making sure that we get more energy here at home from the North Sea, more oil and gas, which we are going to need for the next few decades as we transition to a cleaner future, so we are investing in that too.

Food is another area where your weekly shop has gone up far too much in the past few months especially, so we are looking at the supermarkets, making sure that they are behaving responsibly and fairly when it comes to pricing all those products, to make sure we are easing the burdens on your weekly shop. Then, when it comes to jobs, most of you probably reading the paper you鈥檒l have seen that, you know, businesses everywhere really need people to work at the moment and are finding it hard to find them almost everywhere, so what we鈥檙e doing is reforming our welfare system to make sure that if you can work then you should be working.

You shouldn鈥檛 be able to just be at home, so we are going to reform our welfare system to make sure we are doing that.

At the same time we are also cutting the cost of childcare to make it easier for those working parents who want to work to be able to go back to work after they have children, because that鈥檚 something that I think will make a difference too. That鈥檚 the second part of the plan - going after all those specific things. The third part of the plan is helping those who most need help through the worst of this. Now, how have we done that? Most importantly, we鈥檝e helped with your energy bills.

You might not know this, but we actually made a decision, I made a decision when I was your chancellor, to tax the excess profits that the energy companies are making because of the war in Ukraine and use that money to help pay all your energy bills. So that support is worth about half of your typical family鈥檚 energy bill. It鈥檚 worth about 拢1,500 of support. That is what the Government has done over the past several months, that is the scale of what we鈥檝e done.

It鈥檚 enormous, it鈥檚 like the furlough scheme, quite frankly, in its size.

Now, I know it鈥檚 bad and you鈥檙e still looking at these bills saying, oh my gosh, these are massive bills, but that鈥檚 after we鈥檝e taken about fifteen-hundred quid off them, so that gives you a sense of how much we鈥檝e tried to help on energy.

It鈥檚 not just on energy, we鈥檙e also providing extra help for people who really need a bit of extra help, so those on the lowest incomes, the National Living Wage has gone up, hopefully many of your wages have gone up like the National Living Wage over the last year, because we want to make sure those on the lowest incomes see that benefit. Pensioners, whether it鈥檚 your parents, your grandparents, their state pension has gone up several hundred pounds this year to help them.

Anyone who鈥檚 on Universal Credit, they鈥檙e also getting an extra 拢900 this year of support, so those who need a little bit of extra help are really getting that help from the Government.

At the same time, the things that you guys do a lot, which is travel, we鈥檙e trying to help that, so we鈥檝e cut fuel duty, which will save you about a hundred quid this year for those of you that drive. Also bus fares, we鈥檝e capped bus fares at 拢2 outside of London, just to help people as they鈥檙e getting around. So, all those things, and we can talk later about the other things we鈥檙e doing, hopefully will just ease the burden as we get through the worst of this inflation challenge. In conclusion, I鈥檒l end where I started really.

This is obviously a challenge that many countries are facing right now but we are on it. We are on it and we are going to get through it. Now that鈥檚 not easy, as I said, and anyone who tells you that it鈥檚 easy or it can happen overnight, they鈥檙e not being straight with you. I want to be honest with you.

These things are tough, they require difficult decisions, but that鈥檚 what you should get from your Government, that鈥檚 what you should get from your prime minister and that鈥檚 what I鈥檓 going to do. I鈥檓 going to tell it to you straight and I鈥檓 going to do the things that we need to do to bring inflation down. I am confident that we are going to do that. The reason that we can feel better about the future is because once we get it down, that is the foundation on which we can build a better economy. That is how we will create more jobs and be able to pay people more, invest more in public services.

All those good things that we want are built on the foundation of getting inflation back down and ultimately that鈥檚 what I want. I want to build a better country for you, your children, your grandchildren and tackling inflation is the first thing we need to do to build that better future.

Thanks very much for having me.