INFLATION figures yesterday, that recorded a drop in the inflation rate to 6.8% in July, have been greeted by the Tories and the Bank of England as proof that their policy of driving up interest rates to impoverish workers and drive up unemployment is starting to have an effect.
Tory chancellor Jeremy Hunt and the Bank were adamant that there would be no rowing back and that interest rates would be increased next month for the fifteenth time.
In fact, food prices continue to rocket well above the 6.8% rate being seized upon by the Tories and the Bank of England as proof that the British economy is on the path of recovery from recession.
Food and drink inflation was officially at 14.8% in the year to July. It reached a high of 17.3% in June while some food staples were running at over 20%.
James Longley, managing director at Utility Bidder, a price comparison company, spelt out that food prices would not be dropping, saying: ‘These are essential goods for day-to-day living and there is no sign of prices going down on the shelves anytime soon.’
While the cost of essentials continues to soar, the ONS produced figures yesterday that the prices paid by UK renters in the year to July had increased by 5.3%, the biggest increase since records began in 2016, as landlords passed on the increase in interest rates to tenants.
Thousands of tenants and homeowners have been forced into arrears as a result of the attempt by the Bank of England and Tories to fight their way out of the inflationary spiral by pushing up interest rates to pauperise workers and the middle class giving them less money to spend.
In a press release, the Unite union said:
‘Despite triumphant claims in some quarters that the cost-of-living crisis is coming to an end, the truth is that inflation (RPI) is still outstripping wage growth.
‘As people continue to be hammered by food and energy greedflation, they now face huge rises in rent and mortgage costs thanks to the Bank of England interest rate rises.
‘Meanwhile, corporations continue to profit. The big four banks have published combined profits of over £29 billion for the first six months of 2023, up 77% on last year’.
Commenting on the latest figures, Unite general secretary Sharon Graham said: ‘The government, the Bank of England and profiteering corporations will try to use today’s inflation figures to tell people the crisis is over, but workers won’t be fooled while they see prices and profits continue to rise faster than wages.’
TUC general secretary Paul Nowak commented: ‘It will take more than price rises slowing for working people to feel better off – especially with food bills remaining sky high. Real wages are still worth less today than in 2008 after the longest pay squeeze in 200 years.’
Nowak added: ‘And at the same time, unemployment and insecure work are shooting up. Our economy is far from out of the woods – too many long-run challenges remain unaddressed.’
The only way ‘out of the woods’ for a bankrupt British capitalist system is to drive the working class into abject poverty to make them pay for the crisis of the bosses and bankers.
The Bank of England and Tory chancellor Jeremy Hunt yesterday were united in saying that while the slight fall in the rate of increase in prices was welcome they would still be pushing up interest rates and holding down wages.
In fact, they will be spurred on to increase the attacks on workers and the unions while the TUC sits back and offers nothing but words of complaint.
The working class is the most powerful force in society. The time has come for workers to force the TUC to take action by mobilising this strength in a general strike to kick out the Tories and go forward to a workers’ government and socialism.
Join the WRP lobby of the TUC Congress in Liverpool on Monday 11th September to demand the TUC calls a general strike immediately.
The only way to resolve the capitalist crisis is to put an end to capitalism and replace it with socialism.
