Tuesday 18 August 2015

Cost of living

This is something of a departure from my usual posts which tend to be directly about politics. This one is indirectly about politics.

The cost of living crisis became a topic of conversation in the media as Labour's polling improved in the build up to the election. Funny how even inaccurate polling can affect what gets published. But it's pretty much vanished since the Tories won their slender majority and recent talk has been mostly about how Jeremy Corbyn is bringing lots of new people towards the Labour party and how unelectable he is (the contradictory nature of those two subjects was intentional). 

I consider myself lucky. Despite being an early victim of the recession (December 2008) and having to find myself a totally new career - which was far from easy and brought some incredibly difficult times (without the emotional support of my now wife, I can't be certain I'd be here to write this) - I now have a good job with a moderately impressive sounding job title (unfortunately it comes with a less impressive salary). My wife has two doctorates and works for the NHS as a Clinical Psychologist. We now have a baby and own a house with a garden. 

All good. But the sacrifices we have made would belie our job titles. First, we had to put off getting married and starting a family as I wasn't in a secure job and then, once I was, my wife was only temporary and part-time. Once we were finally both in more secure jobs, we started looking for a house. We couldn't afford a house in the area we've lived for the last decade, so looked at other areas. Many other locations were unaffordable too until we compromised on an area where we could afford a small house with a garden and with a train station no more than a mile away so I can get to work. It's not close to where our friends live; it lacks nice shops, cafes, bars, restaurants; the streets aren't very well kept; the nearby primary school does not have a good Ofsted report; public transport isn't great. But it seems safe enough and it's just about big enough for us and our baby, and the occasional staying guest. And it's the best we could afford.

Since our son was born and with my wife on maternity pay, we've struggled financially. Fortunately, family have been able to buy nursery furniture, a pushchair, clothes etc and friends with older children have donated things too. I'm ashamed to say I never passed my driving test. I really need to be able to drive so that my wife doesn't bear the burden of long journeys to see family and friends (many of whom live between 150 and 230 miles away) but at over £20 per lesson and about £60 for the practical test, I simply can't afford it. One of my work shoes is split: I put off buying new ones and five weeks later, I'm still wearing them. I bought myself a new shirt at the weekend for the first time in a long time - it was in the sale and cost me £6. My beard trimmer no longer works (and replacement parts no longer exist) so I dug out some razors (still in the cupboard from when I did 'movember') and shaved my beard off. When I run out of razors, I'll grow my beard back and see if I can afford a new beard trimmer then. My wife doesn't complain at all but I know she has been worried about money and probably doesn't want to worry me more by talking about it. Our next challenge is paying for childcare. My wife will be going back four days a week (on 0.8% of her full-time salary) and I'm going to be squashing 35 hours into four days (starting early, finishing later, skipping lunch breaks etc) so I can look after him for one day without losing pay.

If we, a Clinical Psychologist and an Administrative Manager, are having financial difficulties like these, how on earth are other people coping? As I say, I know we're lucky to have houses and full time jobs. I really worry about people on lower incomes, in insecure jobs, possibly with debt (which we don't have, apart from our mortgage and my small old-style student loan). Apparently the economy is growing and pay is rising. I'd like to see the stats on these 'facts'. I would imagine that house price increases are causing slight growth in the economy and I would put money (if I had any) on the vast majority of wage rises going to only the top earners. I certainly don't know anyone getting any kind of rise over the rate of inflation.

The biggest challenge in our economy is getting wages and tax revenue up. Anything else is tinkering around the edges, and I have a little flow chart that shows how low-pay is holding back growth and increasing the need for benefits which in turn, causes our economy to stagnate.


I'd like to make one final point: many people rely on hand outs from their parents for deposits on houses, buying furniture and appliances, repairs to homes and cars etc. Some people still rely on this even into their 40s and beyond. Those people are very unlikely to be able to do the same for their children. So who will help them? Wages must start to rise, urgently. 

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