Cutting value of incomes is chancellor’s political choice
BY now many people will have begun to feel the effects of the sudden and general rise in prices. In particular the price rises in basics like food and energy costs, gas, electricity, heating oil and motor fuel. These price increases are hitting home hard. And because the cost of fuel for delivery lorries and vans is part of the price of everything we buy, that is going to push the price spiral even higher.
On top of this National Insurance Contributions are going up. National Insurance is not just a tax on the worker, it is also a burden on often hard-pressed employers. It is a tax on jobs.
At the same time pay rates are not keeping up. And neither are pensions and benefits. Prices are rising at 7% (and much more for petrol and diesel of course). Every pound that you spend is worth that much less. But pay rates and benefits are only rising by around 3% at best.
Three pence more for every pound you earn. Three pence more for every pound in the pension. Three pence more in return for all the National Insurance contributions paid over a lifetime. But an extra seven pence in the pound more to pay in the price of everything you have to buy.
The Chancellor’s response to this huge inflation has been puny, whichever way government politicians and some of the newspapers try to dress this up. We are facing outrageous and unacceptable cuts to everyone’s standard of living. And because less well-off people spend a bigger part of their earnings on basics, the cuts will hit them harder. Bear in mind as well that earnings in our area are lower and we have older and sicker and disabled people who have to rely on pensions and benefits. So, the blow to our communities is even harder to bear.
It’s not as if the government are being forced to follow this policy of squeeze and cut. As prices rise, the Value Added Tax the Chancellor of the Exchequer
gets jumps too. Then, the duty on fuel is particularly high and the proceeds for the government are already huge and getting bigger.
That means the Chancellor is in fact sitting on a huge pile of money that he could use to relieve the real suffering people are now feeling. And if he taxed the enormous windfall profits the oil companies are making, he would have even more.
He chooses not to do this. Cutting the value of your incomes and your pensions and benefits this month is this Chancellor’s political choice. He’s hoping that things will get better by the General Election, probably next summer. And he may well then spend some of your hard-earned money he’s been collecting to try to buy votes.
But it’s a political choice that the Chancellor may well regret much sooner. For in a few weeks’ time there will be local elections in many parts of the United Kingdom, and it doesn’t look good for his boss next door in Number 10. Boris Johnson may well be hoping to heap the blame for all this on his neighbour. Blame someone else, as usual. But bad luck for him for once, there’s a fair chance the Chancellor won’t be around for much longer anyway, given the scandal around his own tax affairs.