Sorry Guido, but there really is a cost of living crisis and it's getting worse under a Tory government.
“Throw in the income tax threshold hike (£493), the savings from holding down council taxes (£210) and you have already countered the Balls attack in cash terms – and some – at £1,703. Meaning that in terms of disposable income the “average working person” is better off.”
In other words, the rise in personal allowance and the fact that council taxes haven’t significantly increased since the coalition came to power outweighs the fall in living standards due to prices rising faster than wages.
Unfortunately for Guido and the Tories, this is simply untrue.
Even when excluding the impact that falling wages are having on peoples’ living standards, the Institute for Fiscal Studies (IFS) says that taking into account tax and benefit changes since 2010 a majority of working households are worse off now than they were when the coalition came to power.
As senior research economist at the IFS Robert Joyce puts it:
“Looking at all the measures that are happening that started in 2010 and that are happening to the end of this parliament, if you look at all the measures announced over that period, then most of those families will lose overall because of things like the main rise in VAT back in January 2011.”
And as John Rentoul has also recently noted on disposable income, comparing the last whole year of Labour – Q3 2009 to Q2 2010 – with the most recent year to Q2 2013, real households’ disposable income per head fell by 2.2 per cent.
Sorry Guido, but the coalition really are presiding over a cost of living crisis.
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