Tories’ cost of living squeeze
Build the workers’ fightback
Tom Baldwin, South West Socialist Party regional secretary
This year is set to inflict more pain on working-class people as rising costs outstrip incomes, meaning real-terms pay cuts.
RPI inflation hit 7.1% in November, the last month for which figures are available. That continues a steady rise throughout 2021 and takes it to the highest level in 30 years.
Statistics showing high wage growth reflect a bounce-back from lockdown, and not the real position for workers.
The average pay deal last year was worth just 2%, and a survey of employers found they were only planning 2.5% raises this year.
Some employers have been even worse, using fire-and-rehire threats to try and slash workers’ pay. Last year also saw the removal of both the £20-a-week Universal Credit uplift, and the triple lock for pensions, meaning they will also rise slower than prices.
At the same time, thousands of workers isolating because of Covid are left to struggle on just £96-a-week sick pay.
A series of changes due in April will pile even more pressure on ordinary people. The energy bill cap will be lifted.
While the exact figure will be announced next month, the Energy Saving Trust predicts £240 rises for a three-bedroom house, an increase of over 20%.
National Insurance will also rise, meaning workers will pay an extra 1.25p in every pound earnt over the threshold.
For the average worker that means an extra £255 a year. The tax threshold will be frozen, a tax increase by stealth that means more of people’s incomes will be taxable. Increased council tax bills will also be dropping on people’s doormats.
Not only are prescription charges set to rise as well, the government is also considering introducing charges for those aged between 60 and the state pension age, meaning millions more people having to pay for medicines.
The Resolution Foundation think-tank estimates that all this means an additional cost from April of a whopping £1,200 a year for a typical family.
It says this risks a “cost of living catastrophe” and describes 2022 as the “year of the squeeze”.
All this, while the government minister Liz Truss wined and dined trade officials at a rich Tory donor’s private club, with the taxpayer picking up the £3,000 bill!
Workers are not passive onlookers to this onslaught though. Strikes have successfully defeated fire and rehire, like the Clarks workers in Somerset; or won pay increases, like bus drivers in Wales.
We need a concerted trade union fightback on wages. The working class also needs a genuine political alternative to fight on issues like pensions, energy costs and more.
- Full pay for all workers isolating or at home because of Covid
- Wages to automatically rise at least in line with inflation
- Minimum wage of £15 an hour
- Living pensions and benefits for all who need them that increase with inflation
- Take housing, energy, supermarkets and big stores into public ownership under democratic workers’ control so they are run for people’s needs and not profiteering
- For a new mass workers’ party