What we all suspected is now official. We really are living in austerity times. Real household incomes have fallen by 2.7%. It might not seem like much but this is the biggest fall in the amount of money households have to spend since 1977.
As a result of pay freezes and cuts, tax rises, higher prices and rocketing fuel costs, we are all spending more on basics and essentials with less. And folks, it’s going to get a whole lot worse before it gets better.
For these figures are for the quarter between January and March 2011 and therefore don’t include the most recent squeezes. This April, some folk entered their second, and even third year of frozen pay, others have found that their tax credits have been cut, and benefits – including universal ones like child benefit – have not risen. Worse, inflation already at a band-busting 4.5% is expected to increase before falling in 2012.
It’s turned us into cautious consumers – and probably not before time. But that is cold comfort to retailers. This week, it’s seemed like we’ve been playing bingo but with all the fun taken out. Habitat, Thorntons, Jane Norman, T J Hughes, Saab, Moben Kitchens and saddest of all, the iconic McCormick’s Music Shop in Glasgow. By Friday, we could have a card full of household names crossed out, with no prizes for being the first to call house.
In the first six months of this year, almost the same number of companies have gone bust than in the whole of 2010, with over 10,000 staff losing their jobs. It’s still some way of the high/low watermark of 2008 which saw record numbers of stores close and retail staff join the dole queue but there’s still plenty of time…
As we struggle to pay bills for day to day goods, there is little left over for luxuries, though that term is being redefined. Clothes, home furnishing and furniture and even little treats like Vienna truffles are clearly beyond the purchasing power of many.
And in an exercise of stating the obvious, albeit in suitably stentorian and sonorous tones, the Governor of the Bank of England rolled up before the Treasury committee to pronounce that “inflation is clearly uncomfortably high” and there is “a very substantial squeeze on real living standards”. Worth every penny of his substantial salary in my view then.
Still, it could be worse. We could be Greece whose economy is in freefall, and whose populace is rioting in protest at further austerity measures insisted upon by the country’s government, in order to avoid defaulting on its previous bailout.
The burd is sure that with all this gloomy news on the domestic front, you’ll be pleased, nay delighted to learn that some are managing to buck the trend. Or should that be “one”.
Prince Charles’s annual accounts were also released today. And what do you know? Not only has his personal income grown by an eye-watering 18% but so has his private income from the Duchy of Cornwall estate. We taxpayers currently counting out the pennies managed to scrape together a wee bonus for HRH this year, increasing the amount he gets from the government by nearly £300,000.
How jolly decent of us, especially when the extra money went on more overseas travel. All those munificent trips to check the former colonies and morale-boosting sorties to the troops don’t pay for themselves you know.
It’s nice though, that while clocking up all those airmiles, the Prince of Wales was actually doing his bit for the environment. Carbon emissions from the Royal household fell by 22% and he is now generating renewable energy through new solar panels. No doubt paid for by the taxpayer, who ironically has to pay for solar panels in his or her own castle. There is more – some of the energy being generated is finding its way back to the national grid, providing a nice little earner for Prince Charles in the process. No, I’m not making this up.
Moreover, there are some who doubt whether the money he gets from the Duchy can truly be considered private. The burd is one of them. After all, he only owns it thanks to us. Our generosity has clearly known no bounds in years gone by but we can be assured that the land, minerals and chattels went to such a good home. As families across the UK get steadily poorer, the Prince will be in his counting house, positively raking it in.
So, when your elderly mother loses her meals on wheels, or your child goes without classroom materials, or your operation gets cancelled, or your local library faces closure, you’ll be able to find solace in knowing that the money that could have been spent on these sorts of public services, is instead going to keep the Prince (and indeed Princes and assorted Duchesses) in the style to which they were born to become accustomed.
“We” are clearly not all in this together.