THE Joseph Rowntree Foundation has found that living costs have risen 25% in the past five years and placed an ‘unprecedented’ financial burden on the poor.
It added that rising childcare and energy costs, coupled with stagnating wages and benefit cuts, widened the poverty gap.
Report author Donald Hirsch said: ‘From this April, for the first time since the 1930s, benefits are being cut in real terms by not being linked to inflation.
‘This, combined with falling real wages, means that the next election is likely to be the first since 1931 when living standards are lower than at the last one.’ This was the year when the National Government was formed.
‘This year’s report demonstrates how the price of a basket of goods needed for an acceptable living standard has risen far faster than average inflation.
‘This has combined with low pay increases to create a widening gap between income and needs,’ says the Rowntree report.
The basket of goods used to judge these figures include day-to-day products such as the weekly food shop and clothing, as well as single-purchase treats such as holidays.
Since 2008, the JRF said, real inflation has climbed by 25% rather than the 17% increase as judged by the Consumer Price Index (CPI), the method used by government.
It also found that in the past 12 months pensioners, and those living alone, had been hit hardest with 4.2% increases in their costs compared with the 2.4% rise as indicated by the CPI.
A couple with two children have seen the cost of living rise to 3.7% and lone parents with one child to 3.3%.
Freezing child benefit, tax credits ‘uprated’ by 1% and the increase in the cost of essentials, JRF added, means a working couple with two children will be £230 worse off a year, a working lone parent £223, and a single person worse off by £49 per year.
Childcare costs have risen more than twice as fast as inflation at 37%. Rent in social housing has gone up by 26%. Food costs have increased by 24%. Energy costs are 39% more. Public transport is up by 30%.
The JRF said a single person now needs to earn £16,850 a year, a working couple with two children needs to earn £19,400 each, and a lone parent requires earnings of £25,600, in order to meet basic needs. A full-time worker on the national minimum wage earns around £13,000.
These are devastating findings for a period when wages have been held down or cut, with much worse to come as the coalition abolishes annual wage progression, further robbing workers of thousands of pounds, and brings in a welfare cap to hold welfare spending down as inflation races away and ravages the poor.
To make the situation doubly worse, Labour Party leaders declare that they agree with Tory policies to slash and cut living standards, provided they really do the job. Another first since 1931!
The trade union leaders, supporting the Labour Party, are wringing their hands at the plight of the workers and the poor, but limiting their action to urging a change of policy, which they know is never going to happen.
The crisis however develops, leaving thousands of destroyed families in its wake.
What must be done is the following:
Trade union leaders who are loyal to Miliband and Balls, the modern Ramsay Macs, must be sacked and replaced by leaders who will lead the working class forward.
The unions must take hold of the Joseph Rowntree basket of essential goods, and demand a sliding scale of wages and benefits; ie, that the monthly percentage rise in the basket of necessities is matched by the same percentage rise in wages and benefits.
When the bourgeoisie says that capitalism cannot afford this, they must be taken at their word, and an indefinite general strike called to bring down the coalition and bring in a workers government and socialism. This is the only realistic policy for today!
