Cost of Living – Labour’s failure

• Labour knew about the squeeze on living standards but did not act. Ed Miliband: ‘We were too slow to recognise the squeezed living standards people faced in our economy’; Liam Byrne: ‘A special four-strong team of officials drafted a document that spotted that the rot had set in back in 2005’; ‘We picked it up too late…It was very late in the day, is the truth’ (Ed Miliband, 1 June 2010, link; House Magazine, 14 June 2013; FT blog, 19 June 2013, link).

• Labour doubled income tax for the poorest by abolishing the 10p tax band. Every person paying tax at the 10p rate when Labour doubled it, will now be paying no income tax at all on that income (HM Treasury, Budget 2013, 20 March 2013).

• Labour’s plan to borrow more would mean higher mortgage rates – just a one per cent rise in interest rates would add £1,000 to the average family’s mortgage. Britain’s top business group – the CBI – has said more borrowing would ‘spook the market’. This would lead to soaring mortgages rates – hitting hardworking families (John Cridland, Sky News, 11 March 2013).

• Labour want to put a new tax on the family home. Tessa Jowell has admitted that Labour’s planned tax on homes would be a tax on the ‘family home’, hitting ‘elderly [people] who are asset-rich and income-poor’ (Guardian, 26 November 2013, link).

• Council tax doubled under Labour. Council Tax soared under Labour with bills hitting £1,439 on an average Band D home in England in 2010/11, an increase of 109 per cent on 1997 costing hardworking families an extra £751 a year (DCLG, Local Government Finance Bill: Localising support for council tax – Updated Impact Assessment, p.5, link; DCLG Press Release, 28 August 2012).

• Labour raised the rate of fuel duty 12 times while in office and planned for six further fuel duty rises after the election. Labour’s March 2010 Budget, delivered by Alistair Darling set out seven further rises, one in April 2010, with six planned for after the General Election (HMRC, Hydrocarbon oils: historic duty rates, link; HM Treasury, Budget, March 2010, p. 8, link).

• UK parents face almost the highest childcare costs in the world. After a decade of Labour, the average cost of childcare in the UK is the second highest in the OECD, behind only Switzerland (OECD, Doing Better for Families, 2011, link; Guardian, 21 May 2012, link).

• Energy bills soared under Labour and they would rocket again under their plans. Between 1997 and 2010, the average domestic gas bill more than doubled. Electricity bills went up by more than 50 per cent. Ed Miliband has committed to a 2030 decarbonisation target that could add £125 to energy bills (DECC, Quarterly energy prices table 2.3.1, 29 March 2012, link; POYRY, Technology Supply Curves For Low-Carbon Power Generation, June 2013, p.99, link).

• Labour would cut the basic state pension by hundreds of pounds a year. Labour would cut the basic state pension, because they say they would cap pension spending and oppose raising the retirement age (Sunday Politics, 9 June 2013, link; OBR, Economic and Fiscal Outlook, March 2013, Table 3.5).

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