By Charlie Kimber
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Cost of living soars by over 11 percent—fight back against the Tories

The new inflation figures underline the need for the TUC union federation's demo on 18 June to be a launchpad for resistance
Issue 2806
A graphic shows a drawing of a person's head caught in a vice, while and arrow points diagonally upwards, left to right, like the line of a graph indicating inflation

The cost of living crisis is deepening as prices soar

Prices are now rising at an average of 11.1 percent a year according to the most accurate measure of inflation, the RPI index, released on Wednesday. So if your pay, benefits or pension are going up less than that—as they are for nearly everyone—then you are taking a big hit. Even the government’s favourite CPI inflation measure, which excludes some basic costs, hit 9 percent. It’s a 40-year high. 

The latest statistics are not just some ordinary and forgettable set of dry numbers. They are a reflection of class war. Soaring prices, and government inaction mean terrible suffering.

There are cases everywhere such as Godfrey and Jeanette Ward in Wigan. “We’ve had two bad winters, and luckily we’ve got through it, but I don’t think we’ll survive another one,” Godfrey told Sky TV. Their combined weekly pensions cannot stretch to cover the rising cost of bills and the urgent repairs they need in their home.

Their old boiler is broken and beyond repair so they’ve had no hot water or heating for months. Such horrors—and worse—will become commonplace, ignored by the political class and the rich. And for tens of millions of workers the price surge means worries about the rent or the mortgage, increased debts, cutting back everywhere and facing a tough future. 

Already poverty is spreading fast. The number of people opening Universal Credit claims each week has surged by 13 percent in the last three months.

Those at the top just throw up their hands and deny responsibility. On Wednesday chancellor Rishi Sunak tried to blame petrol retailers not passing on his fuel duty cut for the rise.

That’s a pinprick. Grant Fitzner, chief economist at the Office for National Statistics, said, “Around three quarters of the increase in the annual rate this month came from utility bills.” But the government does nothing effective over this.

So what can be done? Chancellor Rishi Sunak  told MPs on Tuesday, “There is no measure any government can take, any law we can pass, that can make those global forces disappear overnight.”

Bank of England governor Andrew Bailey, who dares to lecture workers about pay restraint while taking £575,000 a year, says he’s unable to stop inflation hitting 10 percent. He added that Britain faced “apocalyptic” global food price rises.

In part, they are admitting that real power under capitalism does not lie in parliaments but in the boardrooms of the giant corporations. But of course there are measures Sunak and Bailey could take. They could cap prices and rents, boost benefits, raise wages immediately in the public sector, increase the minimum wage to at least £15 an hour and tax profits hard. They could renationalise the privatised power companies and hold down the bills. They could withdraw the national insurance rise.

What they really meant was there is nothing that can be done without confronting capitalist priorities. Instead, they assault benefits, pensions and pay. Tuesday’s labour market data showed regular pay—excluding bonuses—rose by 4.2 percent in the year to March 2022. That was far lower than inflation over that period. Real pay—what you can buy with your wages—fell by 1.2 percent. As inflation accelerates into double digits, real pay will fall much faster.

And there are also signs that a recession is coming. Britain is in its worst period of “stagflation”—weak growth alongside high inflation—since the 1970s. As central bankers raise interest rates to curb inflation, they could crash the economy.

Those at the top are protected. Bonuses rose at a red-hot 30 percent on the year. The poorest 10 percent of earners saw their pay rise by 0.9 percent while the richest 1 percent saw a rise of over 11 percent. These facts, and the social emergency behind them, have to be a spur to struggle. 

Unite union general secretary Sharon Graham said, “The alarm bells are ringing very loudly now. Earnings are being pummelled, the government is, shamefully, turning its back on those in need and employers are squeezing wages. 

“Unite’s answer to the current crisis is that employers who can pay decent wages but won’t will face industrial action. I can tell you that we don’t intend to shift from that. 

“Being in a strong union like Unite is the only way for workers to defend their jobs, pay and conditions and get a decent ‘share of the pie’.”

Good words. But we need to hear that Unite will not support any pay rise less than 11.1 percent a year. Far too often it claims much lower deals as wins. And workers everywhere need pay rises, not just those whose firms say they “can pay”.

Union leaders have to campaign for a real acceleration of action, with national strikes and full support for workers who walk out officially or unofficially. The TUC union federation’s demonstration in London on 18 June has to be built as big as possible. But it must then be a launchpad for a massive acceleration of strikes and other forms of resistance.

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