Opinion: Yes, we’re getting poorer more slowly – but change is needed

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By John Gaskell, Chair, Farnham Labour Party

It is, of course, great news that we are all getting poorer at a slower rate than earlier in the year. But I fail to share Jeremy Hunt’s breathless excitement that inflation has dropped to 8.7 per cent this month.

The small print revealed food price inflation continues to run at just below 20 per cent.

And, to me, this came as no surprise because even though I am comfortably off, like many readers, I am shocked on a weekly basis by the rising cost of my food shop.

The consumer champion Which recently explained this. Despite supermarket own-label budget items still being the cheapest overall, they concluded, these were up 24.8 per cent compared with the same time last year.

Prices for basics like porridge oats and semi-skimmed milk were up more than 33.6 per cent on average and Cheddar cheese – not my favourite – saw annual inflation of 28.3 per cent with some brands priced 80 per cent higher than the same time in 2022.

This shocking state of affairs hits poorer households hardest of course, as people on low incomes necessarily spend a bigger proportion on the basics, including food.

So, sadly, it looks like we won’t see the demand for the services of Farnham’s vitally important food bank diminish any time soon.

The new inflation figure is half a percentage point above the government’s short-term prediction and massively above the long-term aspiration of two per cent. This isn’t just further evidence of the government’s incompetence, but is a double whammy for those with mortgages, since there’s a risk interest rates will rise again.

Building societies like the Nationwide are already passing on the costs of Conservative prime minister Liz Truss’s well-documented blunders to home owners. It seems they may continue to have to do so under the Sunak/Hunt administration.

The Treasury’s attempt to blame food inflation on profiteering by the supermarkets is clearly wide of the mark. The margins for our local chains – Sainsbury’s, Lidl, the Co-op and Waitrose – are all at historic lows.

The government’s attempt to scapegoat public sector workers like nurses and junior doctors who have the temerity to resist getting poorer is equally way off the mark since no credible economist believes this is a contributory factor of any significance.

What we can agree on is the hangover from Covid and the war in Ukraine are indeed big factors, but these will become less important as time passes.

But what they fail to admit is the biggest reason for inflation being so persistent in the UK is the incompetent way Brexit has been implemented, with has led to labour shortages, border hassles, more red tape and the dislocation from our biggest trading partners on the continent.

It is time our chancellor and local MP faced up to this fact before he wrecks the UK economy irreparably.

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