Now An Post wraps huge stamp hikes in
Nobody needs reminding that we are being hit with a deluge of rising prices.
But just to make it official, the latest inflation figure came in this week at 5% for Ireland and a record rate for the Eurozone, according to EU number-crunchers Eurostat.
Concern over the fast-rising cost of living led Britain to hike interest rates by 0.5% as energy costs rocketed on a day the Daily Mail dubbed ‘Black Thursday for Brits’.
The US Fed has also rocked stock markets by flagging multiple rate hikes this year. But Europe’s ECB is taking a hands-off approach, insisting that inflation will die down.
In the meantime, prices are soaring. Maybe it will work out for the best, but the ECB seems out of step with Britain and America in controlling prices. Only savers with lots of money salted away welcome rising interest rates.
But there is a price to be paid for not using this traditional central bank tool to control fast-rising prices.
The latest hike is in the price of stamps. I don’t normally get worked up about something that costs €1.10 – or An Post in general, which is great for savers and quite good at delivering letters.
But the way it spun an upcoming 15c rise in that price as ‘in line with inflation’ gets my goat.
It is yet another example of pulling the wool over our eyes with regard to rising prices.
Is no State agency going to hold the line here and stop the vicious cycle of price rises, instead of using ‘rising inflation’ as an excuse to continue the vicious cycle – or even exacerbate it?
Even a first-year maths student could work out that a 15c rise on a stamp price of 115c is almost triple that 5% inflation rate. And the rise in an international stamp from €2 to €2.20 is twice as much.
An Post has lumped in a load of changes including discounts for SMEs and no increase on a booklet of 10 stamps to claim that the overall rise is 6% – which is ‘in line with inflation.’
Excuse me while I revert to first-year maths again, but isn’t that a fifth more than a 5% inflation rate, and not ‘in line’ with it?
It seems that some corporate price reductions are being allowed to lump in with what amounts to quite a sharp hike in the cost of standard stamps for ordinary people.
This is part of a long-running
trend. The price of a standard stamp has now more than tripled in two decades, from 38c in March 2002 to €1.25 from next month. Yet prices rose just 30% between June 2002 and December 2021. Put another way, something that cost 38c in 2002 should cost around 50c now – not €1.25.
One benefit for consumers is that there is no increase in the price of a booklet of 10 stamps, which will remain at the old price of €11.
But that only means we now get a discount that we should have had before anyway. (Apart from buying a booklet, another way to avoid the hike is to buy N-rated stamps – before the price hike on March 1 as they will remain valid after it.) Some other ways the wool is pulled over our eyes on inflation:
The tax ‘giveaway’ of around €500m in Budget 2022 will become a ‘takeaway’ of over €1bn from our pockets after inflation erodes the true value of tax credits and allowances.
The ‘fiver’ increase in your pension – just 2% – falls far short of rampant price rises. In reality, you get €7.50 less a week at that inflation rate, even including the fiver.
€5,000 in your bank savings becomes €4,500 at the end of year because bank deposit interest rates don’t move one jot while inflation soars.