The economy is supposedly thriving – so why aren’t we?

Figures released from the Office for National Statistics (ONS), have shown the UK economy grew by 7.5% last year – the highest rate of growth since ONS records began. It is of course important to highlight it comes off the back of a dramatic 9.4% collapse in 2020 as a result of the pandemic.

Chancellor Rishi Sunak said the economy had been “remarkably resilient” and proudly told the media that economic growth was higher in the UK than any other G7 nation. This is great news if you’re only interested in reading the headlines. In reality; it ignores that the economic downturn of nearly 10% the previous year, was worse than any other country and the economy remains smaller than it was in December 2019 when this Government was first elected.

Meanwhile, away from the boardrooms in the City of London, the economic footing for ordinary families in Britain looks very different and bears no relevance to the GDP statistics offered above. The rate of inflation for December was estimated at 7.5% last month according to RPI (which offers a far more accurate representation of what people are paying day to day), with January’s figures expected sometime next week. This is the highest rate of inflation measured in the UK since the Thatcher era.

It is estimated that a “typical-use” household will pay just shy of £700 more on energy bills annually come the new financial year. The current Government’s piecemeal offerings to solve the imminently looming energy crisis will do nothing to alleviate the concerns of workers forced to choose between heating and eating. Meanwhile both Shell and BP posted record profits last week, capitalising on surging oil and gas prices.

Last week, the Bank of England raised interest rates, cut its economic growth forecast from 5% to 3.75% for this year and predicted that households were about to suffer the sharpest fall in living standards since records began three decades ago.

Chancellor Sunak announced last week that all households would receive £200 off their energy bills in October. This would have been embarrassing enough had he not followed on by informing parliament that the discount will actually be a loan, needing to be paid back in £40 a year instalments over the next five years from 2023. Sunak also announced Council taxpayers in England in bands A to D would receive a rebate of £150 from their bills in April, which will not have to be paid back.

How do these offerings match up with the Bank of England’s estimates of the sharpest fall in living standards since records began? Or with the highest rate of inflation since the Thatcher era? The answer is that they don’t. The Chancellor of the Exchequer could not be more out of touch with reality if he tried. By far the wealthiest MP in Britain, his net worth is estimated at over £200m, and his father-in-law is a multi-billionaire and one of the richest men in India, similarly Sunak’s wife is among the richest women in Britain.

Back in the real world, we are being squeezed at both ends, with wages stagnating and a real rise of 10% in National Insurance contributions coming in April alongside rises in the price of energy and the continuing surge of food costs. This crisis is only going to get worse.

Across Britain today, tens of thousands came together to protest the economic state described above. They’re entirely right to do so and it is welcome that the People’s Assembly have announced further protests to keep the pressure on the Government. We need to do all we can to strengthen the protections for working people ahead of this crisis.

I implore you all to join the People’s Assembly demonstrations across the country but be aware that these protests alone will not solve this crisis. Join your trade union and campaign for better wages, and greater protections at work. Lobby your MP to support further economic intervention and let’s develop a plan for direct action to ramp up the pressure on this Government from all sides.

We can defeat this government, but only if we are united on all fronts.

Peter Stoddart, is a member of the YCL’s Glasgow branch

Share on facebook
Share on twitter
Share on email
Share on whatsapp
Share on print