Cost-of-living crisis? What cost-of-living crisis?

According to a Tory MP, people should learn to budget and to cook and they wouldn’t have a problem. He claims that you can cook a meal from scratch for 30p.

I was fuming on behalf of everyone who is genuinely struggling to make ends meet through no fault of their own, then I caught sight of his background. Lee Anderson, MP for Ashfield in Nottinghamshire, is a former coal miner and ex-Labour councillor. Not your typical monied, out-of-touch Tory then. I kept digging (or mining) and learned that he has volunteered for Citizens Advice and worked in hostels for homeless care leavers. Sounds like an ok kind of guy.

He was slapped with a community protection warning for trying to block access to a local site to deter Travellers. Bravo that man!

Shortly afterwards, he defected to the Tories and was elected to Parliament in 2019.

In addition to trying to protect his community from illegal incursions, he has said and done many other ‘controversial’ things, most of which I agree with: supporting Brexit, objecting to England footballers taking the knee, and voting against Covid restrictions. Where did he go so horribly wrong? Or is he right?

According to the Office for National Statistics (ONS), “The Consumer Prices Index [a measure of inflation] … rose by 6.2% in the 12 months to March 2022”. In everyday parlance, that means that if something cost £10 in March 2021, it now costs £10.62. So what? If something cost £100 in March 2021, it now costs £106.20. Yeah – still not a crisis.

However, relying again on those clever people at the ONS, who assure us that the median household disposable income in the UK was £31,400 in the financial year ending (FYE) 5th April 2021, if a household’s annual bills totalled £30,000 (I like round figures, given that I have one) in the FYE 2021, then in FYE 2022 their bills would have totalled £31,860. Stating the obvious, that’s an extra £1,860, which doesn’t sound so paltry, does it? 

What’s really scary is that for the next 12 months, the extra money needed to, well, live, is projected to be even higher, for the sake of argument say another £2,500 on top of the £1,860 some had to scrimp and save for this year. Doing the maths for you, it means that an average UK household will have had to find an extra £4,360 within a two-year period. That is serious dosh and the very epitome of a cost-of-living crisis.

However…

Have you seen the horrendous queues of holiday makers at various airports trying to go abroad for a short break? Have you tried to book a table at a favourite restaurant on a Friday evening? We popped down to Somerset recently and made our usual pilgrimage to Clarks Village (outlet mall) on the hunt for essentials such as handbags, serving platters, and matching underwear. We struggled to find a parking space it was that busy with other shoppers. We picked up Covid fairly easily but that’s another story.

Plenty of people do still have plenty of money to burn. If the credit card does suddenly start to throw a wobbly, then there’s plenty of luxuries to forgo for a couple of years, such as climate-change-causing holidays, boutique gins and designer condoms. You’ll be fine. Trust me. Growing up in a farming-cum-mining village in the 1970s, with winters of discontent and hyper-inflation thanks to a failed socialist government (was it ever thus) for company, my parents ended one bleak month with just 80p in the bank. I know how to cut back, make do and mend. It’s not that difficult. Eggs, mince, offal and milk puddings kept us nourished; hand-me-down cardies from older cousins kept us warm, and staying with family in the Lake District did us proud for our one, yes one, holiday a year.

But there are plenty of other people who don’t have any luxuries to barter, and for whom 80p at the end of the month would be wonderful. They were living hand-to-mouth before Covid and Ukraine; the current situation must be terrifying. They’re the ones who really are suffering a genuine cost-of-living crisis. What’s to be done?

Despite me being, normally, very (too?) forgiving of Boris because he got Brexit done, he really hasn’t got a handle on the inflation-situation. Maybe Lee Anderson MP has ganged up with Fishy Rishi to persuade Boris and the rest of the cabinet that households need to get a grip before being given bigger handouts. Sorry, chaps, but you’re wrong. Mr Anderson MP might be right about Brexit, Covid-lockdowns, trespassers and BLM, but he’s way out of order with his views on the cost-of-living crisis.

If I were Prime Minister (I really must devote a whole blog to that title), here’s what I’d do (the list is not exhaustive):

Put more money in pockets:

• Immediately cut income tax and National Insurance for the lowest earners.

• For those on benefits who can find some / more work, don’t cut their benefits until they’re earning a proper living wage.

• Capacity-build food banks to turn food-recipients into food-bank workers.

• Increase benefits for those with known chronic health issues where working (more) is just not possible

• Incentivise banks to relax overdraft criteria and help people to budget

• ‘Incentivise’ supermarkets to buy more British food at more realistic prices without passing on the cost to the consumer. The farming community deserve our support as well!

Take less money out of pockets:

• Suspend VAT on gas and electricity bills

• Suspend the green fuel levy.

• Cut vehicle fuel tax

• Mandate housing associations and private landlords to immediately improve their properties’ fuel efficiency

• Capacity-build food banks to enable education of recipients re budgeting and cooking (which is supported by Mr Anderson!)

• Donate all edible excess food from the catering industry, including excess portions, discarded trimmings and failed attempts (soggy bottoms?) to hostels and foodbanks.

• Supermarkets to donate all (safe) ‘past-sell-by-date’ food, including wilting fruit and veg, to hostels and foodbanks

How can the Government pay for their measures?

• Windfall-tax fuel / energy companies. No it won’t stifle investment like the companies are claiming, because the current profits are higher than investor expectations so these decisions won’t be impacted.

• Windfall-tax the property industry. Gove did well to get big developers to cough up for the cladding crisis. Now how about aiming for the large land agents and investors like Bidwells and Savills who have made housing so unaffordable?

• Increase taxes for foreign property investors who are likewise major contributors to the affordability problem

• Tax aviation fuel and hike Air Passenger Duty – those who can afford to fly should help support those who can’t.

• Sell seized Oligarch assets

One final note on foodbanks. Some say they are demeaning and the Government should increase benefits / tax the rich more. That is economically and socially illiterate. Increasing taxes actually depletes Government coffers, so there’s less money to fund benefits, hospitals and the Police, etc. Very little comes from the rich, but middle-earners end up with less money in their pocket so are less likely to support charitable causes. Community foodbanks respond much more quickly and efficiently when needs arise, compared to the lumbering Government machine, restricted by its size, complexity, bureaucracy and political shenanigans. 

Trust the people to look after their own, which overlaps with what Lee Anderson MP was saying, but his other pronouncements were, in truth, economically and socially illiterate.