Category Archives: Cost of living

Millions on Universal Credit may lose hundreds of pounds as Rishi Sunak threatens cut | Mirror Online

Rishi Sunak: he likes money but he doesn’t understand it. By giving benefit money to the rich in tax cuts, he is cutting away the foundations of the UK’s economy. How will you be able to afford anything?

Once again, the Tories are threatening defenceless benefit claimants in their endless campaign to bribe donation money from rich benefactors.

That’s about the size of this, isn’t it?

Sunak has already threatened people with long-term illnesses and disabilities with changes that are intended to get a million of them off the benefit books – or at least onto the jobs market.

More people looking for work relieves pressure on employers to increase wages, because jobseekers will undercut each other in their desperation – and I use that word advisedly – to get a regular wage packet.

Now Sunak is threatening more than six million Universal Credit claimants – most of whom are in work – with an effective cut in payments if he decides to make the annual benefit increase next April lower than the rate of inflation.

The apparent reason is to fund another tax cut for the very richest, in time for the next general election; he’s buying support where he wants it by harming those he doesn’t ever expect to help him.

Here’s the Mirror:

the Prime Minister refused to commit to inflation-proof benefit rises next year, arguing that payments had already gone up by a “huge amount”.

For clarity, it doesn’t matter how much payments have already increased. Inflation is always a measure of how fast prices are rising. If the inflation rate slows, prices are still rising, only more slowly. Increasing benefits at a rate lower than inflation means millions of working people and benefit claimants will not be able to afford basic necessities.

Chancellor Jeremy Hunt is thought to be considering a real-terms cut this autumn. Payments usually rise each April by the inflation figure of the previous September – expected to be 6.9%. But the Government is looking at a lower figure, leaving 6.1 million on UC worse off.

A rise 1% below inflation would result in a low-income working couple with two children losing £220. Asked if he could guarantee benefits continue to rise with inflation, Mr Sunak declined but insisted he would “make sure we look after the most vulnerable”.

That has to be a lie; Sunak has already attacked “the most vulnerable” with his plan to push long-term sick and disabled people off benefits.

Be in no doubt: this is an attack on you.

The fear is that, by buying support from the rich, Sunak will be able to rely on their influence to persuade – or coerce – you or people like you into supporting yet another godawful Tory election win.

Source: Millions on Universal Credit to lose hundreds of pounds as Rishi Sunak threatens cut – Mirror Online


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The human cost of high energy bills? Nearly 5,000 have died in damp, cold homes

Nearly 5,000 more people died in 2022-23 because their homes were damp and cold. That was the winter when energy bills skyrocketed.

While the energy firms made billions of pounds in profit, Rishi Sunak’s Tory government claimed to be doing all it could to ensure that ordinary people would not freeze.

It seems whatever Sunak did, it was not enough.

Here’s the Morning Star, which had the earliest report I’ve found so far:

Almost 5,000 people in Britain died last year as a result of living in cold and damp homes, an analysis of official data revealed today.

The figures, compiled by the End Fuel Poverty Coalition… calculated that of the 21,890 excess winter deaths in 2022-23, 21.5 per cent were caused by living in cold homes.

It comes as a report card by the Warm This Winter campaign on the government’s progress against its eight key measures to tackle the energy bills crisis, including providing financial support for those most in need, has revealed that on half of these, ministers are making no progress.

The report card found that on one measure, the government has taken backwards steps that will deepen the country’s reliance on expensive fossil fuels by failing to reduce Britain’s gas exports.

We all knew that we couldn’t rely on the Tories to protect vulnerable people against rampant corporate profiteering, and this is exemplary of what happens when they are asked to try.

Tories are rabid social Darwinists anyway; they probably think the deaths of your relatives and friends are a good thing for the country. But:

Every time you hear about energy firms’ profits, remember they are built on the deaths of 5,000 people.

Source: Nearly 5,000 people in Britain died last year due to damp and cold homes, analysis finds | Morning Star


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Why are the Tories trying to hide energy bill misery for those who use the least?

The hard fact for the poorest people: while headline energy costs are falling, the price for those who can least afford to pay is rising unaffordably.

Average energy bills will fall slightly in the three months from October – to £1,923 a year for the typical household, the regulator Ofgem has said

This is a drop of £151 on the current annual energy bill for a typical household, which is currently £2,074.

But there are complications!

The drop is in the price per unit of electricity and gas, and standing charges – that are charged daily regardless of energy use, are set to rise to recoup the costs associated with the wave of supplier failures, consumer defaults, and additional support to shore up energy companies’ finances.

This means people who use less energy – logically, poorer people – will end up paying more for it.

The Resolution Foundation has explained the situation in a press release here. I’ll pull out the important bits:

Any family with an energy consumption less than four-fifths of the average will see higher bills this winter than last, a situation that applies to around one-in-three (35 per cent) of households in England and close to half (47 per cent) of those in the lowest income decile.

For some, these extra costs will be substantial: 13 per cent of households (2.7 million families) face energy bills rising by more than £100 this winter, a figure that rises to one in four (24 per cent) for the poorest households.

The removal of the flat £400 Energy Bill Support scheme, which was paid out in monthly instalments over winter 2022 to all households, regardless of income or energy consumption, is in effect putting upward pressure on every household’s bill this winter.

Whether a household faces a lower bill this winter depends on whether the lower per-unit prices provide savings that outweigh the higher standing charges and removal of the £400 support.

The Resolution Foundation expects 7.2 million households will end up paying more, with 2.7 million spending more than £100 more on gas and electricity bills – including 24 per cent (almost a quarter) of those in the poorest 1/10 of families.

The Conservative government doesn’t care about this increased pressure on the poorest.

Here’s Tory mouthpiece Andrew Bowie (he’s an under-secretary for “Nuclear and Networks”, whatever that means), refusing to discuss the issue with the BBC’s Naga Munchetty and determinedly trying to force the subject back to the reduction in bills for the very richest people:

We may draw just one conclusion from this:

Conservative government energy policy is to make the poorest pay the most (as a proportion of their available funds). They are using energy bills to create poverty.


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Huge pay rise for bosses while workers struggle. Who’s causing inflation?

The real cause of inflation: prices have been rising to give chief executives of companies massive, inflation-busting pay rises.

It’s nice that the Tories aren’t even trying to present themselves as electable any more.

They have spent so much time and energy telling us that our wages have been driving inflation up that it is impossible for them to backtrack, now we can see that the real cause is the naked greed of company executives.

And they won’t take the logical steps to rectify the situation. Firstly, they need to legislate to stop the privatised utility firms (especially energy and water) engaging in brazen profiteering because they can always force the government to increase its subsidy to them.

Tories insist on supporting privatisation, meaning they refuse to allow privatised utilities to go back into public ownership and are forced to increase public funding for them whenever the millions and billions they hand to shareholders seem likely to drive them out of business.

Secondly, they need to do as Owen Jones suggests in the following clip:

“Tax them.”

Doesn’t it seem strange that, with the UK straining under the biggest taxes we’ve had in 70 or 80 years, the government is refusing to take money from those who are most able to bear that load without suffering any serious harm to their way of life?

So it seems to This Writer that they are actually doing the decent thing (albeit unrepentantly), admitting that they’ve done wrong and – by sticking with the policy – giving up.

They’re as good as saying, “We know we’ve done wrong. We’re going to keep on doing wrong until you remove our ability to do so.”

I, for one, can’t wait to get on with it.


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The privatised utility rip-off: Vox Political’s 10-year-old words should haunt government

This is actually a little terrifying.

Words I wrote 10 years ago this month are as appropriate now as they were then. See for yourself.

I was responding to Archbishop of York John Sentamu’s comments on chairing a year-long commission to investigate the need for a living wage (something that is still desperately-needed, even though the Tories have hijacked the term and applied it to something that doesn’t pay nearly enough):

In The Observer, he wrote: “The holes in millions of paycheques are being plugged by in-work support to the tune of £4 billion a year. But why aren’t those who are profiting from their workers paying up? Why is government having to subsidise businesses who don’t pay their employees enough to live on? It is a question we need to answer and act on – fast. The cost of living is rising but wages are not. In the rush for profit, and for high pay at the top, too many companies have forgotten the basic moral imperative that employees be paid enough to live on.”

the simple fact is that the cost of living is too high and – if they had to rely on wages alone – millions of working people, up and down the country, would be unable to pay their bills…

… leading us to a recent blog article by our old friend Michael Meacher MP. He points out that our privatised utility companies are forcing every one of us to pay – through the nose – for substandard services.

He wrote: “More than £100 a year of an average household [water] bill, that is about 30 per cent, goes on profit, compared with 9 per cent in the energy sector which is itself known for egregious profiteering.

The profit on water bills is now 35 per cent, we’re told. Energy profits are also huge, although the exact percentage is not easily available.

“In the last 10 years, water bills have risen by a massive 64 per cent, compared with an increase of just 28 per cent in average earnings. In the last three years alone, average earnings have fallen by 7 per cent while water bills have continued to rise remorselessly. There is no competition in the water industry and the only potential constraint is the industry regulator, but he has chosen to succumb to corporate lobbying in allowing water bills to continue to shoot upwards to feed fancy executive bonuses and big dividend handouts.”

And in all the 10 years since, it seems the regulator has yet to grow a backbone.

What were my conclusions? Get a load of this:

1. The privatisation of the national utilities – water, electricity, gas (and, some would say, telecommunications) – has failed in its stated aims, which were to democratise capitalism by making it possible for everybody to be a shareholder, to keep bills low, and to end government subsidies for these organisations. Instead, shares have been drawn into the hands of a very few rich investors, bills have risen far beyond wages, and government subsidies have either increased massively (rail) or companies have used the tax system to avoid paying the amount due on their profits (Thames Water and its ‘super sewer’).

2. Company bosses, keen to drive up their share prices in order to create larger dividends for their shareholders and higher salaries for themselves, have successfully held wages down in order to achieve this. As ‘neilcon’ pointed out, lower wages mean less spending on National Insurance, meaning that keeping the employee payout down by pennies per person leads to many pounds in increased revenue.

3. The government is unwilling to do anything about this because it wants to keep wages depressed as much as possible. This is the reason it has cracked down so hard on benefit payments – not because of fraud (which is minimal) but in order to create an urgent need among the unemployed to find work, and terror in those who have jobs that they could be replaced if they complain about the increasingly meagre pittance on which they are being told to survive.

What’s the answer? (I asked rhetorically.) Here are my thoughts:

The best place to start might be with the private utility companies. An ultimatum to put their houses in order and charge a reasonable amount, rather than extorting money out of a captive clientele, might produce results – especially if the alternative is re-nationalisation.

This might take the pressure off the smaller private companies by actually reducing the amount calculated as the living wage; with lower utility bills, the amount of money needed for a working person’s survival will also drop.

If the government and the utility companies got their sums right, this could mean the need to subsidise working people’s pay would be wiped out, meaning a large saving on the tax bill. Feed this through to working people in the form of a tax cut and, again, smaller private companies would benefit (along with everybody else, of course). An alternative of using the money to help pay off the deficit would be unhelpful – we need more, and healthier, businesses in this country, employing more people. Get that sorted and the deficit will come down in any case.

On a completely different tack, what about Landlord Subsidy (otherwise known as Housing Benefit)? Why not put a cap on rents, thereby ensuring that the government is not subsidising the rapidly-increasing pace of (some) landlords’ greed?

Unfortunately, this is not likely to happen under the current government – and it seems the Parliamentary Labour Party is to keen to become the Plastic Tory Party to take a stand; it will be up to its backbenchers and the party’s grassroots members to force a policy change.

… and isn’t the situation the same today? Sadly, Keir Starmer’s Labour purge means the Substitute Tory Party is unlikely to offer any help at all.

But a plan that acknowledges the mistakes of the past and aims to redress the shocking way that the supply of money has overbalanced to favour a tiny minority – to the detriment of the vast majority – would constitute the first steps on the way to a nation that can not only provide [a] living wage, but also help our struggling small businesses.

Was I right?

I reckon so.

And am I right now?

I reckon so.


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Should water firms charge an extra 40% to tackle the sewage crisis?

You pay for their bad decisions: the privatised, profit-driven water firms have had more than 30 years to fund the restoration of the UK’s crumbling sewage system but instead they have given £72 billion to investors and pumped our effluent into the environment. Now they want to increase our bills by almost half to fix the problem they have created. But where will the money really go?

It looks like the UK’s privatised water firms are trying to sell us down the river again.

They want to add an extra 40 per cent to our bills, saying that’s what it will cost to clean up the sewage crisis they have caused by neglecting the UK’s crumbling system of sewage pipes.

Here’s a report about it, broadcast early in the morning of Wednesday, June 28, 2023:

It’s true that Thames Water boss Sarah Bentley has quit her job, that was worth £1.6 million a year to her, even before she got anywhere near the bonus she received (that she has already given back amid anger over the firm’s poor performance over sewage):

We don’t know how much her bonus totalled but last year she received £496,000.

Unlike many of the water firms, it turns out that this was much more than Thames Water shareholders received – they haven’t had a payout in six years, possibly because the business seems about to go down the pan:

Thames Water is an unusual case, though; since privatisation in the late 1980s, water companies have paid out £72 billion to shareholders.

Should this money have been invested in restoring the crumbling system? Has such investment been watered down to give a fast return to investors?

Panellists on the BBC’s Politics Live thrashed their way through these murky waters in two debates, when it seemed the Tory panellists, Bob Seely and Johnny Mercer, knew why this disaster has happened, but the left-wingers had the solution to it. See for yourself:

The funding system certainly seems to be sending our money down the drain.

But isn’t that because water is not appropriate for privatisation and is, as Mr McKenna suggested, a racket?


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Hey, kids! Oldies in suits just made everything you want more expensive!

Rishi Sunak: the richest man in the UK is the UK’s prime minister. He isn’t affected by inflation or interest rate rises – but he, his government, the Bank of England and businesses are all determined to make sure that you are. How long are you going to sit there and let them mess with you, because you’re “not interested in politics”?

Now do you get why politics should matter to you?

Today (June 21, 2023), we’re all being told that inflation has remained high despite promises from the rich old folk in suits that it would plummet down to more manageable levels.

The reason for this is being touted as high food prices, according to mainstream news outlets like the BBC (UK inflation shock as food costs keep cost of living high) – but this isn’t true. The real reasons are corporate greed and Brexit.

(I know it doesn’t help that the mainstream media keep misleading you. Their job is to distract you away from what’s really happening, of course.)

So the utility firms (energy and water) and the supermarkets are fleecing you by charging whatever they want for goods that they’re actually buying far more cheaply, and this is offsetting the increased costs of importing goods that was caused by Brexit (and the war in Ukraine, although that is a secondary issue now).

The response from the government and the Bank of England is to make everything even more expensive by increasing the cost of money. If you don’t understand how they do this, it’s by raising interest rates on borrowing.

Businesses borrow habitually – for investment, or to finance temporary deficits during hard times, or (as we have learned about the privatised water firms recently) because they are diverting all the money they make into dividends for their shareholders and top executives.

Raising interest rates means the amount they will have to pay back to their lender of choice increases, meaning they have less spending money. Normally this creates a knock-on effect in which they stop buying the goods they need (because they can’t afford them), forcing the suppliers to reduce their prices in order to make sales. As inflation is all about price rises, this means inflation falls.

But that’s not happening at the moment because businesses are simply factoring the interest rate hikes into their pricing structures – they’re passing those rises on to you, the customer.

The result is that prices continue to rise, so inflation remains high.

The economist Richard Murphy explains what has happened in a useful Twitter thread. First, he tells us that the reasons we are being given for inflation are not true:

So inflation is not being caused by influences outside the control of the UK’s politicians and businesspeople. Mr Murphy continues:

Trade unionist Howard Beckett agrees with this, and adds to it usefully:

They’re allowed to do this because our politicians let them. The government could cap prices, but doesn’t want to. Is it because our MPs and their political parties are receiving weighty donations from the businesspeople?

Here’s Mr Murphy again:

So he agrees with This Writer (or more accurately, I agree with him – he’s the expert).

If you’re asking how this has anything to do with you, here comes the bombshell:

But…

The bottom line is that not only have you been deprived of the cash to buy the things that make life worth living (due to cuts that mean your pay is at 2005 – or even 2000 – levels while prices have surged) but you are also now expected to cover the increased prices demanded by the profiteers and the interest rate-setting banks from what is left.

Those are political choices.

Politicians whose own salaries (plus the afore-mentioned corporate donations) mean they aren’t affected by these decisions have used high inflation to take your money away from you.

The reason is simple:

They don’t want you to have any money.

Money provides security, and the lack of it means the lack of security. And an insecure person is controllable; you’ll do whatever you think you must, in order to survive. Right?

The ultimate aim – as This Site and others warned more than 10 years ago – is to put you in a permanent cycle of debt. This provides the fatcats with a population who will work like dogs for peanuts while they reap massive profits. Happy days – for them. Misery for you.

The only way to prevent this is to get rid of the people who are inflicting it on you – and that means using your vote to shift the rot out of Parliament.

Ah, but you don’t vote, do you? You can’t be bothered with politics because it doesn’t affect you.

Take a look in your wallet. Take a look at your bank account. Do you have as much in either as you did last year?

No?

Then politics does affect you. It doesn’t matter if you’re not interested in them; the oldies in the suits are definitely interested in you.

How badly are you going to let them mess up your life before you actually do something about it?


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The main points: it’s Vox Political’s morning headlines

DWP accused of ‘denying people their rights’ after rejecting 90% of disability benefit appeals

Food inflation: actual shop prices hit new high

Exposed: payments to LABOUR Health spokesman from private health firms

Under Keir Starmer and Wes Streeting, Labour Party policy has changed from returning the National Health Service to full public control into allowing it to be converted into even more of a front for private firms to profit from your illness.

Is the reason for this the fact that Streeting is being paid a small fortune every year by private health representatives? See for yourself:

Energy firms consulted on plan for extra profit

Energy prices are coming down at last, so what is the regulator Ofgem doing? It’s consulting the companies on a plan to increase their profit so they can be “financially resilient”.

They just made a killing (sadly, in some cases this may be said to be literal) on prices over the last year but this cash went straight to shareholders, it seems. Wouldn’t it have been better to fix dividends at a lower level and put more of that money into “financial resilience” rather than fleecing the public again?


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Brexit to blame for a third of Britain’s food price inflation

The price of Brexit: lorries waiting at Dover for the paperwork to be done.

Would you like to know why this is important?

Britain’s departure from the European Union has accounted for about a third of the increase in food bills for households since 2019, equivalent to about 250 pounds ($316), researchers from the London School of Economics and other universities said.

Although London and Brussels have an agreement allowing largely tariff-free trade in goods, barriers to exports and imports in the form of paperwork, known as non-tariff barriers, have caused delays and higher costs.

The answer is simple, if you remember:

When we were being asked to vote in the EU referendum, back in 2016, we were told again and again that Brexit would reduce paperwork, bureaucracy and red tape.

Remember?

File it as yet another Brexit lie.

Source: Brexit to blame for a third of Britain’s food bill rise, researchers say


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Energy bills: look out! The rip-off lies are coming thick and fast

Energy prices: don’t be fooled – your bill is still going to be high. But with wholesale prices at their lowest in four years, ask your supplier why.

Before you do anything else, watch this – it’s Martin Lewis explaining what the energy price cap change in July will actually mean to you:

So the first thing you need to know is that the drop in average bills from £2,500 to £2,074 is meaningless to you because you’re probably not paying the average. You would be better-off looking at it as a 17 per cent fall and working out what that means for your personal bill – after removing the standing charges, of course.

Yes, the standing charges are remaining the same, meaning you’ll pay around £300 next year, just to be able to have electricity and gas in your home. So people using less energy can’t save much by cutting their usage.

There is a consultation on the possibility of cutting the standing charge but we need to remember that our energy firms are greedy and will do their best to keep prices as high as possible, no matter what that means to you.

In the autumn and winter, bills are likely to rise again, we’re being told. This strikes me as strange, because the energy firms buy their fuel “many months in advance”. Note that we aren’t being told how many months in advance they buy it.

If, for example, it’s seven months, then in December the price of energy should be the cheapest it’s been in two years, because of this:

Energy firms have historically claimed that they “smooth out” the fluctuating cost of their product by averaging out the price over a long period of time, as well.

But This Writer has doubts when energy analysts like Cornwall Insight say further price cuts are unlikely, especially if there’s a cold winter and the UK has to compete with other countries to buy fuel.

I thought we were supposed to be buying our fuel months, or even years, in advance.

So shouldn’t the energy price this winter be extremely low?

I think we need explicit clarity on this – I mean actual, black-and-white figures showing exactly what electricity and gas have been costing the energy firms, exactly how they’ve been “smoothing out” that cost (and between what dates) and why they are apparently failing to pass on the current savings.

How are their profits at the moment? What are they projected to be over the next year?

It seems to me that we – the consumers – are being ripped off brazenly.


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