Inflation is adding to pain of austerity

THERE were scenes of heroism that played out in West London on Wednesday night as firefighters did what they could to save as many lives as possible at Grenfell Tower.

Yet the heroes have been subject to a public sector pay cap for years.

Of course firefighters deserve more pay, as do nurses and others in our public services who perform such vital work.

But it shouldn’t be a question of selectively rewarding workers who do the kind of work that endears them to the public.

There are many people in the public sector who are underpaid for the work they do, and they all deserve a rise.

Decreasing people’s purchasing power – which is what happens when workers have a pay freeze imposed, or are given a rise below inflation – is bad for us all. It means people can spend less, and consequently less money is circulating in the economy, with the result that businesses suffer.

It is so easy for an economy to get into a downward spiral, and sometimes statistics which indicate there are more people in work paint a false picture.

They don’t take account of the fact that many people are in jobs which pay very little or that many people are underemployed in that they would prefer to be working more hours.

There’s a sense that people are tired of being victims of austerity. After several years of belowinflation pay rises – if they’re lucky enough to get one at all – workers are finding it harder to make ends meet, and getting increasingly restless.

Things are not helped by the rise in inflation, largely attributable to the fall in the value of the pound since the UK voted to leave the EU.

All the indications are that inflation will continue to rise as Brexit gets closer.

In these circumstances, the kind of moderately redistributive policies advocated by Labour and other parties of the left are likely to gain in popularity.

It’s very difficult to argue against a modest increase in taxation for higher earners who could afford to pay more.

If the Conservatives had won a landslide, there would have been little chance of such policies advancing, but with Parliament so finely balanced it’s likely that the Government will be more flexible in its approach to the economy.

It would be good to have a change in direction that would give people hope, instead of making them feel that there is no way to get off a treadmill that brings everdiminishing rewards.

It should soon become clear whether Mrs May and her minority Government are able to set aside ideology and seek a more consensual way of running the country.

The Conservatives’ insistence on doing a deal with the sectarian DUP gives little room for optimism.

But political surprises are currently in fashion, and nothing should be definitively ruled out.

If, however, the intention is to press on for a hard Brexit and a hard-right economic agenda, we are likely to be in for an increasingly torrid time. The Western Mail newspaper is published by Media Wales a subsidiary company of Trinity Mirror PLC, which is a member of IPSO, the Independent Press Standards Organisation. The entire contents of The Western Mail are the copyright of Media Wales Ltd. It is an offence to copy any of its contents in any way without the company’s permission. If you require a licence to copy parts of it in any way or form, write to the Head of Finance at Six Park Street. The recycled paper content of UK newspapers in 2014 was 78.5%