“The government should raise incomes and control prices, rather than leaving people to be hit by inflation, by interest rate rises, and by falling real pay.”
By Beth Winter MP
We’ve had thirteen interest rate rises in a row, yet little help for those in housing need. And thirteen years of public sector pay cuts. And that’s all the Tory government has done is to double down on more real term pay cuts.
Having bailed out the banks in 2008-09 to the tune of hundreds of billions of pounds, the government should now deal with the causes of inflation by controlling bank profiteering, and redistributing the extreme wealth that exists to those millions of people, including those in my constituency of Cynon Valley, who are suffering and are at serious risk and are petrified of losing their homes through no fault of their own. And the government should take action to tackle the cost-of-living crisis by raising incomes and controlling prices, rather than leaving people to be hit by inflation, by interest rate rises, and by falling real pay.
The moment reflects the extent to which the cost-of-living crisis is spreading contagiously from the working-class on lower incomes to those normally more comfortable on middle incomes.
More of the many, are being thrown into the same difficulty, with the usual class and income divisions and fractures amongst the majority disappearing as more and more are affected by this Conservative government.
Events in recent days have shown us a number of familiar refrains. Firstly, that the Conservatives treat representation, parliament and peers as part of a game. Whether it is Boris Johnson flouncing out of parliament at the drop of a hat (or a critical report) or nominating friends to the House of Lords, it’s all part of their elite Eton and Oxford game.
And secondly, that the Conservatives working with institutions like the Bank of England will always sacrifice working class living standards.
We’ve seen through thirteen years of austerity including public service cuts and pay cuts, through eighteen months and more of a new cost-of-living crisis thanks to energy and food provider profiteering and real terms pay cuts, to continued interest rate rises, that the Conservatives and their friends in the establishment will never look after working class living standards. They’ll cut your pay, cut your services, and whilst profits soar, say they have no otheroption.
This agenda is generating growing anger amongst working class communities who can’t heat their homes, who can’t buy the food their families need, and who – as a result – are now making their voices heard.
This needs to be targeted directly at the UK Conservative Government. We’ve seen an upsurge in strike action and no doubt we will see an upsurge in protest activity as well.
But they know it’s coming. The Tories are tanking in opinion polls.
Which is why they introduced the Elections Act to bring in Voter ID requirements for parliamentary elections. The strikes and protests are why they brought in the Police, Crime, Sentencing and Courts Act. It’s why they brought in the Public Order Act. And most recently, the Strikes (Minimum Service Levels) Bill.
We should be clear on the economics of what is happening.
Austerity has cut public service provision – from council services, from job centres, from legal aid, to childcare and more.
Pay restraint has cut real wages month on month for 18 months, and we are back down to 2005 levels of real pay. People receiving 7% or 8% pay rises sounds high. But in the context of a weekly food shop going up 17 or 18% or your energy bill going up 37 or 38%, it’s not a real pay rise. It’s a real-terms pay cut.
Social security is not good enough. People can’t find places to rent on universal credit. People are turning off medical equipment they need to use at home.
And racism is being ratcheted up, by a Conservative government that wants working class people to blame desperate people arriving on small boats and being overcrowded into overcrowded camps, ships and unsuitable hotels.
And all the while, the fossil fuel firms providing our energy, or the agribusiness food suppliers, or the supermarkets, or the privatised water companies, and – indeed – the banks, are all making hundreds of millions in profits and are paying their directors and their shareholders millions of it in bonuses and dividends.
The Conservatives and the institutions justify it and rationalise it, to make you think there is no alternative. Rishi Sunak says he will halve inflation. But he’s not doing so.
We need to understand what they are doing and why they are doing it.
They are allowing major corporations and senior directors and shareholders to make millions of pounds.
And the source of that money is your rent going up, maybe your mortgage payments going up (for some), your food and energy bills going up and your pay held down.
It’s a transfer of money from ordinary people to the wealthiest in society.
We know it. We understand it. We need to tell people it. In the pub, in the supermarket, on the bus, on the train, wherever you are. And we need to make clear demands.
The Government must control inflation directly. It should require the energy companies, the food companies, to hold down prices and manage the financing of that from their profits and reserves and through pausing dividend payments. They can afford to do so.
It should lift pay, and pensions, and social security. There is no wage-price spiral. Pay is lagging behind inflation which is being driven by the profiteering. So nurses, junior doctors, teachers, rail workers, all need pay rises.
It needs to build houses – council houses – and provide cheap homes in attractive new estates and developments.
And let’s not wait for that. Let’s get out and do it. You might be in the Labour Party. You might be in a trade union. Maybe your organisation is a tenants union. Or volunteering in a food bank.
There are plenty of places to talk and organise.
We just need to organise on the same agenda, with the same goals, for income rises, price controls, better public services, and when there are collective events, come together, generate political pressure together and win together.
- Beth Winter is the MP for Cynon Valley and a regular contributor to Labour Outlook, you can follow her on Facebook, Instagram and twitter. This article is based on a number of contributions made by Beth Winter at Cardiff Transformed on 24 June and in the House of Commons 26 June.
- Join Beth at the closing rally of Arise Festival 2023 tomorrow (Wednesday 28th) at 6.30pm – ‘Strike back against the Tories & profiteers – Fight for a Socialist Future.’ Register and see the full line-up here.