Lies, damned lies & inflation figures... Cont from front being frozen this year, while private-sector increases will vary from 2 to 3 per cent, according to Income Data Services. According to the consumer price index (CPI), which governs the minimum wage and state pensions and benefits, the cost of living is only rising at 4.5 per cent a year. Even the retail price index (RPI), which includes housing costs, puts it at a mere 5.2 per cent. But the true picture for most people is that prices are actually rising far, far faster. Alcohol and tobacco prices have risen by 9 per cent over the past 12 months and transport by nearly 10 per cent. Food prices are calculated to have increased by just 4.4 per, but basic foodstuffs such as bread and cereals went up by 7 per cent, soft drinks by 10 per cent and "sweet" condiments and confectionery by more than 7 per cent. But why is there such a huge discrepancy between the fantasy world of government, business and media statisticians on the one side and the real world of working people on the other? This is because official indices consider price changes for a "basket" of household expenditure items, each item given different weight according to its prominence in the typical household budget. According to the latest CPI presumptions, the "typical" household in Britain spends no more than 12 per cent of its outgoings on food, less than 5 per cent on domestic fuel and only 4 per cent on petrol. These are the areas where most of the biggest price increases take place - but their impact in the "typical" CPI household is, not surprisingly, negligible.
Mr and Mrs Typical CPI, on the other hand, are keen to buy vehicles and audio visual equipment, go to the opera, eat out frequently and pay young Jemima and Jocelyn's school fees. So they spend 4 per cent of their annual income buying cars, 15 per cent on culture and recreation - excluding pubs and clubs - another 12 per cent on hotels, restaurants and cafes (but not canteens) and 2 per cent on education. These are areas where many of the smaller price increases have occurred over the past 12 months. So, hey presto, the cost of living in Britain has only gone up by 4.5 per cent. The RPI provides a slightly more realistic picture of the cost of living for working class and many middle-class households. It excludes the richest 4 per cent of households from its calculations, while including housing costs. Even so, the RPI measure is also misleading. It excludes pensioner households that are heavily dependent on state benefits, while the housing costs element presumes that the typical household spends just £230 a month on mortgage interest or rent. A working class price index would put the real annual rate of inflation at around 8 or 9 per cent, taking basic food, drink, tobacco, metered gas and electricity, petrol and public transport costs fully into account, including for pensioner households. And worse is to come. Household electricity and gas bills are set to rise this year by 10 and 15 per cent, respectively. High oil and food prices on world commodity markets will push up petrol and food prices in Britain still further. At the same time, companies such as British Gas, Sainsbury's, Tesco and Shell will continue to reap superprofits from soaring prices in
sectors where they have a monopoly. So what is to be done? The Communist Party has drawn up a Left-Wing Programme which details a series of policies which can lessen the impact of the crisis on workers and their families. It calls for government action to: Impose price controls on household fuel, petrol and basic foodstuffs. Levy a windfall tax on monopoly profits to fund public investment in council housing, renewable energy and employment. Charge a wealth tax on the richest 10 per cent of households to raise pensions and benefits and reduce the public finances deficit. Place a "Robin Hood" tax on all financial, currency and commodity transactions in the City of London.
Close all tax havens Take gas, electricity and railways out of the hands of the profiteers and invest in a greener Britain. Unions need to lead a big wages offensive for increases which meet the real rate of inflation. The TUC should demand negotiating rights on the national minimum wage. Above all, we need the unions to lead a mass, broadbased people's campaign to defend public services, benefits, jobs and local communities against the ToryLib Dem cuts. Britain is still one of the wealthiest countries in the world. Our capitalist class owns more than £4,000 billion in declared personal wealth. Taxing the rich and big business, instead of reducing corporation tax on company profits still further, would raise far more than the £21 billion being "saved" by this year's cuts.
The Communist Party has a proud and influential history in the unions which have formed Unite. Notably, in the T&G – especially in the car industry, amongst bus workers, and dockers. But we were also strong in the old AEU and other skilled manufacturing workers’ unions. Draughtsmen and technicians, printers, and others all saw highly-respected and powerful Communists at all levels. Today, Communists in Unite have reformed, regrouped and reconnected. Delegates such as you – yes, you – reading this bulletin, can play a role in shaping our union for the future. If you’ve agreed with what we say in this edition of UNITY, our regular bulletin for union conferences, then isn’t it about time you joined us?
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June 2011
Unity! Lies, damned lies & inflation figures by Robert Griffiths
A World to Win We are facing the biggest attack on our standard of living in decades, as the ConDem government rush to put in the final nail in the coffin of the Welfare State. All in the name of cuts that are not necessary. At the same time, workers’ rights are threatened yet again with the outlawing of ‘wild cat’ strikes, coordinated actions, strike bans for ‘essential’ workers and business secretary Vince Cable promising last week at the GMB conference, to go even further if workers increase the level of industrial action, in response to government cuts. Our BA members know that resolute industrial action is effective and our union will continue to play a leading role in the fight to win back all our civil rights including the right to take solidarity action.
London’s streets saw one of the greatest shows of solidarity for many years against the common enemy on March 26. Only a government which condemns so many to poverty, deprivation and unemployment could have brought out so many thousands from up and down the country from a host of different local anti-cuts groups and trade unions. The Communist Party believes that the People's Charter can play a vital role in presenting a positive alternative to cuts in pensions, benefits and public services. Co-ordinated action in defence of pensions by civil servants, teachers and lecturers at the end of this month are to be welcomed and can play a key part in building the momentum towards even wider actions involving both public and
private sector workers. Calls to move eventually to a general strike is a clear signal that workers are up for this challenge, which could help bring about the collapse of this illegitimate government. Unions must stand together in the fight against cuts, for jobs and in defence of services, as Unite and PCS agreed in their landmark agreement last month. The widest possible unity is needed if we are to defeat this onslaught by the ConDem government. It’s vital that attempts to divide public sector and private sector workers are resisted. It becomes a meaningless division as the privatisation agenda marches on relentlessly. After all once you're on the dole, nobody asks whether you're an unemployed public sector worker or a private sector one.
Britain is witnessing the biggest onslaught on working-class living standards since the early 1980s, according to the Institute for Fiscal Studies. Bank of England governor Mervyn King predicts that people's real incomes will fall on a scale not seen since the 1920s. This presumes, of course, that the trade unions and labour movement do nothing to stop it happening. But unemployment is already heading towards three million. If the £203 billion spending cuts go through between now and 2015, another one million jobs will be lost. The merciless drive to force the long-term sick and incapacitated off benefits and into low-paid work or destitution will increase the misery, while disguising the full extent of rising unemployment. Most public-sector pay is Continued on back page