'Our economy is broken'

Unite has slammed the government and Bank of England for twisting statistics to suggest the cost-of- living crisis is coming to an end, after the latest figures show that real wage growth is still, in fact, failing to keep up with price rises.

On Monday (August 15) new figures from the Office for National Statistics (ONS) showed that although regular pay excluding bonuses rose by 7.8 per cent in the three months to June, wages are still not keeping up with inflation – the RPI measure of inflation in the year to June stood at 10.7 per cent.

Although slowing, food price inflation still remains high, at 12.7 per cent in the month to August. Figures from consumer group Which? published this week showed that since 2021, the cost of food basics has risen the steepest, in some cases by over 30 per cent.

Their data shows that food products with the highest rates of inflation over the last two years include milk, up more than 36 per cent; cheese, up by over 35 per cent; and butters and spreads, which have skyrocketed by 32 per cent.

Meanwhile, vegetable prices have increased by 19 per cent since 2021, and meat prices have gone up by more than 23 per cent.

Housing costs also continue to relentlessly climb – figures from the Office for National Statistics (ONS) published on Wednesday (August 16) showed that rent prices have risen by the highest level since records began in 2016. The cost of renting rose by an average of 5.3 per cent in the year to July, the ONS found, with Wales and Scotland seeing higher rent price rises, up 6.5 and 5.7 per cent respectively.

Homeowners are likewise set to endure further pain as continued interest rate rises are likely.

Commenting on the news that pay growth excluding bonuses had risen, Unite general secretary, Sharon Graham said, “Make no mistake, the battle to push up pay has been hard fought and it’s certainly far from over. Our economy is broken. Everyday people are suffering.

“The benefits of being the 5th richest economy in the world are not felt equally, as rises in rents and mortgages, monthly bills and the high costs of the weekly food shop continue,” she added.

“Until the abhorrent inequalities in our society are tackled, along-with rampant profiteering, there will be no real change to people’s lives. This could be the moment for political leaders to lead and not trot out the usual rhetoric. Quite frankly we are sick of the trading of warm words. What we need now is action.”

Unite also rubbished claims that the latest inflation slowdown published on Wednesday (August 16) was an indicator that cost of living pressures had eased. The union emphasised ongoing rising housing and food costs, while corporations continue to profit. The big four banks, for instance, have published combined profits of over £29 billion for the first six months of 2023, up 77% on last year.

Graham added, “The government, the Bank of England, and profiteering corporations will try to use today’s inflation figures to tell people the crisis is over, but workers won’t be fooled while they see prices and profits continue to rise faster than wages.”

 “Until policy-makers stop attacking wages and take on the corporate profiteers there will be no end to this cost-of-living crisis.”

You can read Unite Investigates latest profiteering report – which shows profiteering, not wages, being the true driver of inflation – here.

By Hajera Blagg