Budget ignored the hardship of millions

THE Tory Spring Statement last week was notable for its disregard for the hardship facing millions of households. Inflation has soared to 6.2% – a 30-year high – with rising energy, fuel and food costs driving it up to 8% within months. With around a fifth of UK adults having less than £100 in the bank, rising prices are set to push millions into severe hardship.

If energy bills hit £3,000 per year, which the industry forecasts before 2023, the most financially vulnerable households will be spending £1 in every £6 they earn on energy and over 15 million people could face fuel poverty from next month.

Cross-party calls to ease bills by levying a windfall tax on fossil fuel companies, which have seen profits quadruple from skyrocketing gas prices, went unheeded; Tory backbench pressure for a temporary abandonment of climate change targets for a small 5p cut to fuel duty proved very misguided, when the top priority to prevent a cost of living crisis is pushing poorer households into abject poverty; and with over 40% car-less, the richest fifth – spending five times as much on fuel – grabbed an unfair third of the overall 5p cut.

To cushion by half the new 1.25% National Insurance tax increase already proposed for April to directly help the NHS backlog, a new ‘Tory Tax-Cutting Plan’ emerged beginning with NI, from July this year, having its tax-free threshold lifted by £3,000, on a par with Income Tax, meaning the first £12,570 of all earnings is tax-free, saving a typical employee – not the employer – over £330 a year.

The Chancellor’s attempt to cover up massive Covid debt and tax increases inexplicably became ‘cake tomorrow’ advanced election propaganda: basic rate income tax to be cut from 20p to 19p from 2024! Is this yet another sick joke in two years’ time, to join a benefits increase of 3.1% next month, gone next day by prices inflation? All this after Tory cruelty to cut Universal Credit by £1,000 a year last year.

Real terms weekly earnings are no higher today than in 2008 and for welfare benefits things are even worse by sustained Tory cuts taking levels back to 2001/2. An Office for Budget Responsibility (OBR) report predicted that household disposable income per person will fall by 2.2% in 2022-23, the biggest in a single year since records began.

Overall, the message from the Spring Statement is clear: the UK is sleepwalking into a cost of living catastrophe and the Government doesn’t appear to care.

Alan Debenham Taunton, Somerset