THERE is no way to mask the crippling impact a £693 rise in energy bills will have on millions of household budgets.
Chancellor Rishi Sunak’s bid to sweeten the pill with a council tax rebate and an “energy bill rebate” which is actually a loan that has to be paid back don’t alter the facts: most families are going to be paying hundreds of pounds more a year.
The Bank of England says we must “brace ourselves” for the biggest drop in living standards since records began.
Energy prices are not the only cost that is spiralling out of control. Food prices are rising fast. Transport costs are up, with the government imposing the highest rise in rail fares in a decade.
The Conservatives are ramping up National Insurance to take more out of workers’ pay cheques. They have withdrawn the universal credit uplift, snatching over £900 a year from the least well off.
Through the new Way to Work scheme, they are planning to slap more penalties on universal credit recipients to force them to work longer for less.
The idea that this is a government committed to “levelling up” is a sick joke. The pandemic has dramatically worsened inequality.
The Resolution Foundation found last year that the top 10 per cent of households increased their wealth by an average £50,000 while workers on furlough saw their incomes cut.
The government that clapped for carers is holding their pay down way below inflation, which is now at its fastest in three decades.
Retail prices index (RPI) inflation is already well above 7 per cent, the figure that the lower consumer prices index (CPI) calculation — misleading as it does not include housing costs — is now predicted to hit this spring.
The left and labour movement must be clear: the pain headed ordinary people’s way is entirely avoidable and completely unacceptable.
The rise in global energy prices that the government likes to hide behind means that oil and gas producers are posting record profits — the cost of extracting and delivering energy has not gone up.
Yet top Tories like Education Secretary Nadhim Zahawi — a former oil industry exec himself — claim brazenly that oil and gas companies are “struggling” so should not be made to pay a windfall tax to fund relief for the rest of us.
Labour rightly slams Sunak’s sticking plasters as “puny” — yet its own VAT proposals don’t scratch the surface of the problem.
The energy firms should be nationalised.
This would enable the government to control prices. It would mean the rise in energy prices on world markets brought in revenues that could be directed to socially useful ends, including the insulation of homes and development of renewables.
As John McDonnell said today, there has never been a better time to press for energy nationalisation — yet despite a Labour conference decision to support this, despite Keir Starmer having promised to support it when he stood for leader of his party, Labour now dismisses the possibility.
In the first lockdown when he became Labour leader, Starmer said the pandemic had exposed the appalling pay and conditions of some of the most essential jobs in the country — those of the “key workers.” The last should be first, he pledged, with proper pay and respect for these jobs.
Labour’s feeble triangulation on pay betrays that vow. The labour movement must not give ground to pleas for “fiscal responsibility” or “paying back” the cost of Covid through spending cuts. The rich have made a killing from Covid. The money for decent pay and public services exists but is hoarded by the few.
Only pay rises above inflation can prevent families being driven into poverty. Only public ownership and control can deliver the price controls we need to stop serious, long-term downward pressure on living standards.
These demands must be raised in every workplace and on every street.
