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As Parliament returns this week, more evidence has piled up over the summer recess that the Tory-DUP coalition of chaos is failing Britain’s economy with its commitment to never-ending austerity.
Specifically, Office for National Statistics figures released last week show that household spending growth has slowed to its weakest pace for two-and-a-half years, which is yet another reflection of seven years of Tory economic failure, adding to the growing pile of evidence that their ideologically driven austerity is bad for Britain’s economy and society.
The figures showed that Britain is now the slowest-growing economy in the G7, household spending is decreasing, the number of young people not in work or education remains largely unchanged and business investment has stalled, as Britain’s crisis of underinvestment becomes more stark.
Recent labour market statistics showed that millions of people have faced a real-terms pay cut under this government.
With wages continuing to fall in real terms, Tory cuts to in-work support and rising prices, many households and families are worse off under this government.
Indeed, every day in the press there are reports of how people’s living standards are being more and more squeezed by prices rising faster than wages.
Take housing, for example. Recent analysis by Labour has revealed that almost a million (972,000) households in England are paying more than a third of their income in mortgage costs — an internationally recognised standard of housing affordability — despite record low interest rates.
This follows official figures earlier in the year which revealed that the number of households headed by someone aged under 45 who owns their own home has fallen by an astonishing 900,000 since 2010 to just 44 per cent.
And each week we find out more about how our public services, including education and the NHS, are being starved of vital resources.
Yet the Tories’ response to this deepening cost-of-living crisis is more of the same — permanent and deepening austerity that starves the economy of much-needed investment. The Tory “solution” to these economic difficulties also involves you working longer.
The Conservative government has announced plans to extend the retirement age from 66 to 68 from 2037, with recent research highlighted by Labour showing this will make 36.9 million people — who are currently under 48 years old — work longer.
As I have written in this column before, fundamental economic factors facing Britain mean that the difficulties we are currently seeing in different areas of our economy are set to deepen.
Central to these economic difficulties are Britain’s chronically low levels of investment. Investment is not just the most important factor in economic growth but outweighs all others put together.
This is why when David Cameron and George Osborne took power and slashed the last Labour government’s investment spending it pushed our economy back into recession.
Already, on the main measures of living standards the UK is in the worst position of all the advanced industrialised economies and is in a unique position of seeing GDP expanding while wages have contracted.
Real pay is already beginning to decline again, contracting at the start of 2017 for the first time since August 2014.
Britain’s wages crisis was also confirmed in a recent IMF report which showed that the share of national income going to workers in wages has fallen since 2010.
The Tories are taking Britain backwards, living standards have fallen and now the indications are that it is going to get worse, leading to a sharpening cost-of-living crisis for millions of people in the years ahead.
In the weeks and months ahead, Labour’s principled opposition to Tory austerity — and support for a coherent, credible alternative based around investing in our future — means that Conservative MPs will have to explain to tens of thousands of people in their constituencies why the burden of Tory austerity is continually being pushed onto them, while corporations and the richest individuals receive more and more tax breaks.
In contrast to the Tories’ failed austerity, Labour’s economic plan consists of developing a proper industrial strategy to support our key industries; ending austerity and building world-leading public services by taxing the super-rich; and crucially establishing a new national investment bank and regional development banks to drive investment.
This economic plan is also the foundation for being able to deliver a series of policies that would benefit the majority of Britons in terms of our living standards as outlined in Labour’s general election manifesto For the Many, Not the Few, including free primary school meals, a series of important pledges to pensioners including keeping the triple lock, banning exploitative zero hours contracts to give real job security and introducing a real living wage of £10 an hour to give nearly six million people a pay rise.
As Parliament returns this week, let’s do all we can to oppose Tory austerity — including by supporting the People’s Assembly Against Austerity demonstration at the Tory conference in Manchester — and keep up the campaigning around Labour’s progressive alternative.
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