Inflation has dropped to 6.8 per cent – but this is not an endorsement of Conservative government policy.
The Tories have spent months claiming that they cannot pay the money they deserve to public sector workers (including the junior doctors who were on strike over the weekend) because it would worse inflation – but today’s fall comes alongside an increase in average pay.
Looking at the small print, we see that none of this pay rise has gone to people who actually need it; instead it has further fattened the bloated bank accounts of high-paid company executives and other friends of the Conservative government.
So the lie that wages drove up inflation exposed as media announces largest increase in wages and sharpest drop in inflation. Proving the crisis we are still suffering is one of greed of those at the top of society inc the banks energy corps and others.
— Ian Hodson (@IanBFAWU) August 16, 2023
But that doesn’t matter; wages have increased and inflation still came down. The Tory lie has been exposed as – in the language of Peter Stefanovic – bollocks:
🚨UK News shows🚨
Government Ministers are doing the rounds today suggesting the new inflation figures prove the Prime Ministers decision to impose crappy real terms pay cuts on public sector workers was correct
It’s COMPLETE BOLL****! Please watch this & call them out on it! pic.twitter.com/S5XqcRtUbB
— Peter Stefanovic (@PeterStefanovi2) August 16, 2023
The clip includes a few other interesting take-outs:
Workers in the UK are £11,000 a year worse-off.
2022 was the worst year for wage growth in almost half a century.
Average real wages in the UK will still be lower in 2026 than they were in 2008.
So it is impossible for public sector wages – or any other wages paid to employees – to have had anything to do with inflation figures.
In fact, according to the extremely non-socialist International Monetary Fund, the largest contributor to Europe’s inflation over the past two years was rising corporate profits cause by companies increasing their prices by more than the costs of imported energy. Look at your own energy bill over the past few years and compare the increases with the costs of energy and you will see the factual accuracy in this.
Increases in private sector wages may increase the price of goods – because companies would factor those rises into their prices.
There is evidence of this in the new figures: strip away the cuts in energy and food costs and core inflation is one per cent higher.
But that doesn’t happen in the public sector where, for example, healthcare is free at the point of use.
And the public sector labour force is only 17 per cent of the total workforce, meaning its pay increases have a lower effect than anything happening with the 83 per cent in the private sector.
Of course, prices are still increasing, meaning that people will blame that on increasing wages and demand another interest rate rise from the Bank of England to curb spending by the little people (you and me, as opposed to the big bosses who have actually received the pay boosts).
I struggle to grasp the point of such a move as it is more likely to cause a recession than stabilise the economy. The precipitous rise in interest rates set by the Bank has not affected inflation at all, and conventional wisdom suggests we will not see the result until 18 months after the first one was imposed. With inflation already coming down of its own accord – as was widely predicted by people like economist Richard Murphy – this could be disastrous.
So when the Tories come out with outrageous nonsense like this…
Great news that inflation has fallen from 7.9% to 6.8% 📉
Halving inflation is our number one priority – and through tough but responsible decisions – we’re on track
More to do but good progress today https://t.co/CzvXTMBC3z
— Gillian Keegan MP (@GillianKeegan) August 16, 2023
… I am glad to see responses that put it into the proper perspective, like this:
The news ie inflation is slowing..
Strip away energy & food costs & core inflation is 1% higher.
Wages are level with or exceeding inflation.
Unpacking the figures shows it only pertains in the higher salary bracket.
It's all unchallenged spin.
— Clare Hepworth OBE (@Hepworthclare) August 16, 2023
Sadly, the message is unlikely to get through to the general public, thanks to the biased priorities of our right-wing social media platforms. Look at the number of views the Tory propaganda has received, in comparison with those collected by Clare’s response.
Finally: at least someone out there can laugh about it. Read this:
Each year, one group of public sector workers achieves a pay settlement that sets the benchmark for union wage negotiators. This year it's the royal family, who got a 45% pay increase.
— David__Osland (@David__Osland) August 16, 2023
Sadly for the story, even though the Royals are technically working in the public sector, they are right at the top of it, so their pay rise comes in as equivalent to those of the fatcat company execs.
Still, I don’t see anyone talking about the inflationary effect of this massive increase, so it adds to the evidence that public sector pay does not affect inflation and the Tories have been feeding us bullsh*t since the public sector strikes started, if not before.
Try to remember this amid the barrage of inadequate and misleading reporting by the BBC and the rest of the Tory media.
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