Tag Archives: wage

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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Why are private rail firms paying shareholders so much profit when they’re so far in debt?

Mick Lynch: he knows what he’s talking about. What a pity his interviewers can’t say the same.

Have a gander at this video clip, courtesy of the TUC – if you can get past the bizarre behaviour of the interviewers.

To me, it seems a very strange way of running a business.

If a firm is making a loss, it seems very strange behaviour for a national government to subsidise it – especially if it is still handing over huge amounts in dividends to shareholders.

That money should be covering the firm’s losses, shouldn’t it?

No wonder Mick Lynch’s union members haven’t had a pay rise in four years – and I’m willing to bet it was a pittance then!

Some might say low wages are better than being unemployed – but if these firms are being parasitised by fatcat investors, then by rights, they should be closed down and the bosses (and the investors) prosecuted for misuse of public funds.

Or so it seems to me.

Perhaps the government believes that the railways must continue running – but in that case, the obvious answer presents itself. It’s one that Mr Lynch himself points out the government has used.

Re-nationalisation.

Then there would be no shareholders to take dividends that should be invested.

Am I mistaken?


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The news in tweets: Sunday, June 4, 2023

Rishi Sunak: he’s not known for being a Vox Political reader, but will he still be smiling if he chances upon this article?

Here’s this sunny Sunday’s info-dump  – and This Writer hopes it doesn’t cast a cloud over your mood.

Rishi Sunak won’t give public money to UK schools but with his wife has given $2.4 million to a wealthy US college

There will be more on ‘Eat Out to Die Out’ in another Vox Political article later today (June 4, 2023).

Is pre-election tax cut plan the reason for Rishi Sunak’s current war on sickness and disability benefits?

Tory MP begs Rishi Sunak to quit the European Convention on Human Rights – confusing it with the EU

For information: Andrea Jenkyns is a Tory MP who is currently deputy chairwoman of the Brexiteer European Research Group (ERG). Her claim that other Tories got the leader they wanted in Rishi Sunak suggests a developing schism among Tory MPs that could split the party as it grows – and let’s hope it does.

She certainly seems to be trying to undermine Sunak, with a letter that confuses the European Convention on (and Court of) Human Rights with the European Union and European Court of Justice.

For information: UK citizens have never – at the time of writing – voted to relinquish their rights to a free and fair trial, democratic elections, freedom of association (that is, the right to meet anybody we want to), privacy, or any of the others that the Convention upholds.

TWITTER catches Boris Johnson lying about the reason for London police station closures

DWP and police target criminal gangs involved in benefit fraud. What about those involved in tax evasion?

The video has been released after the Daily Telegraph published an online calculator to show readers how much of their salaries is being used to pay social security benefits in what many have dubbed an act of Nazi-style hate crime.

The argument against these acts by the government, police and media is simple: tax evasion costs the UK far more than benefit fraud and error but is investigated by far fewer people and nobody (to This Writer’s knowledge) has ever been arrested in a video clip. Here are some facts:

Corporate profits have nearly doubled since 2019 while average wages are lower than in 2007. Why are the government, Bank of England and bosses blaming wage rises for inflation?


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Aldi boss did NOT blame the minimum wage for inflation, it seems


This is interesting: it seems the Torygraph has been feeding us falsehoods.

After yesterday’s article commenting on claims that Aldi boss Giles Hurley had said the minimum wage was to blame for high inflation, information has come to This Site stating that it is not true.

This information seems persuasive, as Aldi has the lowest prices in the UK (according to Which? magazine) and the highest hourly wages of any supermarket. It is also the only supermarket to pay colleagues for the breaks in their shift.

Why would anyone blame the minimum wage for inflation when they actually pay more than that as a matter of course, while keeping their prices lower than anybody else? That would indeed seem strange to This Writer, and as the Telegraph can only say the comments were “understood” to have come from a roundtable event at 10 Downing Street earlier this month, we have no direct source for the claim.

The Telegraph went on to state that “sources close to Aldi, which markets itself as a cheaper option for British shoppers, insisted that they related to the wider food sector rather than supermarket pay”. Again, as this is not supported with a directly-attributable comment, we have no reason to believe it to be true. I can’t see how a boss who pays more than the minimum wage to his own employees would say it was too high for others.

It seems This Writer’s own claim that a 27 per cent sales rise means an increased operating profit may also be at fault. According to the supermarket’s most recent published financial results, pre-tax profits for the year 2021 were £35.7 million – a drop of £229.1 million (86.5 per cent) on the previous year.

Aldi has attributed this to “investment in prices, people and pandemic-related expenses”.

Figures for the year 2022 are not yet available so we can’t yet see how profits were affected in that year.

So, unless anyone else can produce more convincingly-damning evidence, it seems Aldi and Mr Hurley are in the clear.

This does not, of course, change the facts about the other supermarket chains.


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You’re £11,000 worse-off than in 2008 due to wage stagnation – but the billionaires aren’t!

Cash money: if you haven’t seen even this much in a while, it’s because – thanks to Tory policies – billionaires have vacuumed it all up.

Here’s a painful piece of information I found on the social media:

I did a bit of digging (not very much!) and it turns out that Mr Burgon isn’t wrong:

Workers are £11,000 worse off per year due to 15 years of wage stagnation, according to the Resolution Foundation.

In new figures shared with BBC Panorama, the think tank calculated that, had wages continued to grow at the pace seen before the 2008 financial crash, the average worker would make £11,000 more per year than they do now, taking rising prices into account.

Torsten Bell, chief executive of the Resolution Foundation, told the BBC the wage stagnation of the past 15 years is “almost completely unprecedented”.

Unprecedented it may be, but you can bet it was entirely planned by the Tories who slithered into government in 2010.

“This is definitely not what normal looks like. This is what failure looks like.”

Not as far as those Tories were concerned. For them, it was success. They funnelled the cash away from the majority of UK citizens, away from the Treasury, and into the hands and offshore bank accounts of the tiniest minority of the super-rich.

As for the billionaires… here‘s Statista:

The UK’s top ten richest people are wealthier than the group has ever been, according to The Sunday Times, who recently released their annual Rich List. Their data finds that the cumulative wealth of the top ten billionaires in the UK has grown from £47.77 billion in 2009 to £182 billion in 2022 – an increase of 281 percent.

As this chart shows, following the 2008 crash, the UK’s billionaires have seen a steady, and fairly steep, incline in their wealth. The upward trend continued despite the pandemic, which saw the UK’s economy shrink by 20.4 percent in the second quarter of 2020, as most industries suffered, and 30.5 million people in Europe were expected to be pushed into poverty. This is a stark contrast to the UK’s 250 ultra wealthy, who saw their collective wealth surge to a record high of £653 billion in 2022.

And Jeremy Hunt’s Budget predicted slower growth than we expected after the disastrous Liz Truss was ousted from Downing Street last year.

And the Tories are starting to bounce back in the opinion polls.

Who are the people going back to them? Are they masochists?

Source: Workers £11,000 worse off a year due to stagnant wages – Resolution Foundation


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Globalisation and privatisation are pushing UK families into poverty

Need a miracle: this is YOU, the day after tomorrow.

Here’s a terrifying article by Brett Christophers (who?) originally in The Guardian.

The author examines the reasons rent, food and energy prices aren’t coming down, if household incomes are.

His answers can be summed up in two words: globalisation and privatisation.

He tells us:

Profits have reached record levels… [but] the cost of living crisis reflects the combination of higher prices for essentials with household incomes that are at best standing still.

Part of the reason that UK companies are generating record profits is precisely because they are successfully keeping wage costs down.

It has long been understood that across an economy at large, companies cannot simply drive down wages and expect profits to hold up in the medium or long term. After all, workers are also consumers. Lower wages mean a lower capacity to consume.

Then he hits us with the reason the big UK firms have managed to avoid this threat to their profits:

Much more than is the case in other countries, such firms tend to be distinguished by one of two key features, both of which insulate the companies in question from the potentially negative impact of UK wage stagnation.

The first is their geography. Companies in the FTSE 100 index derive less than a quarter of their revenues from the UK – a remarkably small share. In other words, domestic demand conditions are largely irrelevant to their fortunes.

That this is true of the UK’s big oil and gas companies, BP and Shell, whose profits are at all-time highs, is well known. But it is no less true of profit heavyweights in other sectors such as AstraZeneca, BAE Systems, British American Tobacco (BAT) and Unilever.

That’s globalisation – these firms operate in other countries where wages are higher and can therefore charge what they like. If UK households default on their energy bills, their lights will go out and the energy firms’ bosses won’t think twice about it.

The second key feature of many leading UK firms is less often discussed. This is the non-discretionary nature of the expenditure that households incur in consuming their services: expenditure such as loan payments, housing rent and utility bills.

Many of these companies have been in the news for their profits, too – companies such as HSBC, Centrica, Thames Water and Annington Homes. Their household customers, many (and, in some cases, all) of whom are located in the UK, are essentially captive: they must make payments, whether wages are rising or not.

In the case of the disproportionate prominence of firms earning revenue in the form of non-discretionary household expenditure, the explanation is … : privatisation. In the 1980s and 1990s, both Conservative and New Labour administrations went about privatising publicly owned assets that occasioned regular household payments – principally housing and utilities – with a gusto and comprehensiveness unparalleled elsewhere in the global north.

So successive Tory and New Labour governments have created a situation in which working households are now being held hostage by the corporations that have effective monopolies on the goods and services we need, simply to be able to live.

I lived through the period when Margaret Thatcher was privatising everything in sight, and when globalisation was the buzzword for the economy. I knew it would end badly for people like myself – and that’s exactly what is happening.

But far too many of my fellow citizens were taken in by the weasel words of Thatcher, Major, Blair and all their fellow-travellers; people who subsequently became extremely rich by forcing us to struggle.

And now, future generations will pay. And pay. And pay…

But if you ask young people today what they think, most of them will say they aren’t interested in politics and it has nothing to do with them.

Source: If UK wages are going down, why aren’t rent, food and energy prices coming down too?


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Struggling to afford food? Work longer hours, says Tory Coffey. Does she work at all?

Let them eat overtime: this is because working people can’t have any fruit and veg under a Tory government.

Here is your regular reminder that Therese Coffey is rubbish.

It’s from last week but got lost among all the other rubbish the Environment Secretary threw at us then:

Here’s a video clip of her actually saying it:

Meanwhile, let’s have an update on the fruit and vegetable shortages her government has caused:

And how about a reminder that the Tory Brexiters were adamant that we wouldn’t suffer any shortages at all?

And what is her plan to end the food shortages?

Apparently, it is to choke on her own words:

If you noticed that Luke Pollard asked if Coffey wanted to go down as the Secretary of State for Sewage, you may welcome this update on the pollution of our rivers:

All the fish dead because the Tory government couldn’t be bothered to properly regulate the water and sewage firms it created by privatising a national utility and asset.

It should be a criminal offence and these people should be locked up – and forced to eat and drink the produce their incompetence has polluted.*

*I know that’s a death sentence but it will never be carried out, even though it would be poetic justice.


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Meeting strikers’ demands WON’T cost £1,000 per household. Sunak is LYING

Rishi Sunak (right) with his wife Akshata Murty: they live in the richest household in the United Kingdom and as such would pay more than most of us if striking public sector workers were to get the wage deal they want.

So much for his claim to be bringing integrity to the UK’s government.

Perhaps we should not be surprised that the UK’s prime minister is lying to the people, but we should certainly question why anybody so economically illiterate was ever invited to be Chancellor of the Exchequer!

Rishi Sunak is actually trying to protect the richest people in the UK – those whose incomes have increased the most during the nation’s recent economic upheavals – from paying their fair share towards resolving the problems he and his colleagues have caused.

(Let’s not go too far into the argument about tax paying for anything at all. By now, everybody should know that the government creates money – or rather, orders the Bank of England to do so – and spends it into the economy; tax is a mechanism to prevent inflation by ensuring the amount of money washing around the economy is limited. That is exactly why taxes would be raised in this case.)

You see, tax is paid on a sliding scale; the lowest-earning households in the UK don’t pay any at all, while those with the highest incomes – unless they are involved in tax avoidance schemes (and many are, because Sunak insists on allowing them to continue) – pay considerably more than the average.

Sunak himself lives in the richest household in the country. You need to understand that he has a personal interest in this.

So he has sent out his spokespeople with a silly lie that he hopes that, if it is repeated enough, you will believe.

Here’s Peter Stefanovic to explain further:

Who do you believe? Sunak – or Stefanovic and me?


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Why will the Tories pay pharma firms 24x the usual price of their pills, but won’t give nurses a pay rise?

Pharmaceutical firms have hiked the price of medication for Strep A – the disease that is currently killing UK children – from 80p to £19 per packet.

The government is happy to pay that amount.

We know this because a government minister said so in a response to Labour Lord Prem Sikka, who wanted to know whether the government would start up its own pharma firm to manufacture this medicine for a fair price.

Here’s a commentary on what happened:

So the government is happy to pay the cost of particular medicines, even if the companies supplying them hike the price to 23.75 times its normal level – because that’s “the market price”.

Nurses are telling government ministers “the market price” of their labour should be 1.2 times its current level – and the government has refused to pay.

The latter group is looking for a fair price for an honest day’s work; the former is engaging in bare-faced profiteering.

And the Tories are supporting the profiteers. Think about it.

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Controversy grows around Truss chief-of-staff Mark Fullbrook

The man Liz Truss chose to be her chief of staff has already been interviewed by the US FBI in relation to vote-rigging in Puerto Rico.

Now it transpires that he is not being paid directly by the government for his government role, but by a private firm, for which he works (or has worked). So the government has been privatised. Is there a tax dodge involved here?

It’s a lobbying firm, which means this company seeks contact with the government in order to influence it.

Worse still, it’s alleged that Truss persuaded Fullbrook to take the role in return for running the Conservatives’ next general election campaign.

This has really upset Tory MPs.

Here’s why…:

Have YOU donated to my crowdfunding appeal, raising funds to fight false libel claims by TV celebrities who should know better? These court cases cost a lot of money so every penny will help ensure that wealth doesn’t beat justice.

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