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From The Socialist newspaper, 3 November 2021

Tories 'era of optimism' means real-terms living standards cut

Fight for a real wage rise for all

Fight for socialism

photo Paul Mattsson

photo Paul Mattsson   (Click to enlarge)

Brent Kennedy, Carlisle Socialist Party

Some wages may be rising on paper, but in real terms they are falling. Analysing the budget hype, the Institute of Fiscal Studies (IFS) reveals the truth: "High inflation, rising taxes and poor growth... will see real living standards barely rising and, for many, falling over the next year."

Rishi Sunak really put the con into Conservative with his budget spin. His headline 59p increase in the minimum wage - in six months' time - amounting to a rise of 16.52 after tax, if you can get a 35-hour week, will be wiped out by National Insurance and price rises. But those low-paid workers, and those who can't work, have just been hit immediately by the 20-a-week cut to Universal Credit, leaving many 1,040 a year worse off.

While the Tories give the banks billions of pounds more in tax cuts, just as they are doubling their profits, the Resolution Foundation shows that the average family will pay 3,000 a year more in taxes due to the budget. So much for 'levelling up'!

The living standards of the public sector workers who have sacrificed so much in the pandemic will fall drastically this winter as their pay is capped or frozen. Sunak has promised them 'jam tomorrow' - next April - hoping they won't fight him now. But he has set aside no additional cash for a pay rise next year, hoping they will have to fight either for more pay or better public services. Their union leaders must fight for both, but now, and mobilise public support.

But even worse is to come. Over a decade of Tory austerity and wage squeezes - unprecedented in 200 years - has resulted in a staggering gap in living standards.

The IFS now warns that a continuation of this will leave the average worker 13,000 worse off by 2026! By then, average wages would be 30,800, compared with 43,700 had they continued their pre-2008 trend. That amounts to a loss of 42% of potential household income thanks to the Tories and the lack of Labour 'opposition'.

This harsh material reality will expose the illusion of the Tories' 'era of optimism'.

This stagnating spending power will only hold back economic growth further. The Tory toffs talk about a high-growth, high-wage economy, but then say wage rises depend on rising productivity. But how can workers increase their productivity if their bosses are cutting investment by 2.5% this year, after no investment growth for the last seven years?

This lack of investment shows that the bosses are not 'optimistic' about their own crisis-ridden capitalist system.

To ensure the investment in decent living standards and the public services we deserve, we need to fight for an alternative socialist system that puts people and the planet before profit; one where the major industries are publicly owned, and the economy democratically planned to meet the needs of the majority, not a super-rich minority.

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In The Socialist 3 November 2021:


COP26

Socialist change to end climate change

Fight for socialism to end climate destruction

COP26 begins - workers strike for pay

COP26 News in brief


Campaigns news

Why I joined the Socialist Party

Fund the fight for a socialist world

Sheffield students tirelessly campaigning for socialist change

Hackney children's centres: Campaigners see through council deception

East London gentrification plans exposed


News

Fight for a real wage rise for all

Local government cuts set to continue - we need councillors prepared to fight

Race to top for bankers

Fight for a 15-an-hour minimum wage and an end to youth rates

Water companies put profits before protecting our environment

Tories threaten arts students: we are prepared to fight back!

Tory Universal Credit crumbs no solution to cost of living crisis

Tory plans won't fix social care

Pay freeze lifted for civil servants - prepare now for the struggle for a decent rise


Workplace news

NEU: Strategy needed to bring members together to take national action

Oaks Park school strike spurred on by head's lies

Scunthorpe scaffs strike into fifth week

Unite leaflets supermarkets to build support for Weetabix fire and rehire strike

Plant engineers pay dispute


Fighting sexism

Sexism, safety and the profit system


International news

Sudan - mass protests and general strike against coup

Chile: International solidarity campaign to free political prisoners

Vaccine inequality - the ugly face of capitalism

Hunger strike in Calais for refugee rights

Protests against Sudan coup reach Britain


 

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