Tuesday 18 October 2011

High inflation and low wage growth are squeezing living standards even tighter

Inflation has increased considerably over the last month. September's Consumer Prices Index (CPI) rate was 5.2%, up 0.7% on the previous month, reaching the record high set in September 2008. The Retail Prices Index rose to 5.6% from 5.2% in August, the highest level it has been since 1991.

Midlands TUC Regional Secretary, Rob Johnston, said "The economic news just keeps getting worse. Only a few days ago we had thousands more people added to the Midlands dole queues and now families are today hit with news of soaring inflation. With a stagnant economy, living standards ae continually squeezed.

'Osborne's austerity is hurting and clearly not working. The Chancelloe is out of touch with the difficulties faced by people across our region. It is about time Ministers stopped posturing and started to take action to get people working.'

What's more, the figures today show that public sector pensions will be cut by 0.4% next year alone as a result of the Government's pensions uprating switch from RPI to CPI."

TUC General Secretary Brendan Barber said:

"The cost of living is now rising three times faster than wages - squeezing people's living standards even tighter. But instead of standing up for hard-pressed families, the government is making things worse by hiking VAT and cutting vital tax credits.

'Ministers must do all they can to promote a plan B based on jobs and decent wages. We cannot build a sustainable economic recovery on the back of people getting poorer.

'Today's figures also confirm that the government's CPI stealth cut will reduce the value of benefits and pensions by 0.4 per cent next year. This cut could slash public sector pensions, as well as many in the private sector, by nearly 30 per cent over the next three decades, and send many more people into poverty in retirement."

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