Prime Minister Andy Burnham is travelling around the country this week to learn about the cost-of-living crisis. Political commentator Tim Newark says he could save the PM the trouble and explain exactly what is causing higher prices: higher wages and higher corporate taxes feed into the rising cost of food, while high energy prices add to farming and industry costs, which in turn cause rising prices. Newark argues that almost everything Labour does to raise money for the public sector and welfare bill hits consumers' pockets.
Labour policies blamed for high street costs
Newark contends that Labour politicians have a remarkable inability to see how their hunger for taxed money to pay out benefits is pushing up the price of almost everything on the high street. As Burnham trundles around the country, he will see direct evidence of the impact of Labour policies all around him, Newark says.
Young people straight from school used to be a way to keep serving costs down in bars, pubs, and shops, but not anymore under Labour. Minimum wage hikes and national insurance increases have discouraged many high street businesses from taking on young staff. Labour politicians just can't understand the link between taxing businesses and those firms being forced to pass the costs on to their customers, Newark writes.
Green taxes and energy costs
The virtue-signalling green plastic packaging tax introduced last year is forecast to add billions to retailer costs, with 80% of this being piled on to shoppers – the Bank of England estimating this alone adds 0.5% to food inflation. The cost of admin and compliance for every new shred of government red tape also has to be paid for somehow, and the customer is the final port of call for that extra money.
The ridiculously high cost of energy in the UK, in large part due to green subsidies sandwiched into our bills, feeds into everything. UK power prices are amongst the highest in the world, with Americans paying half as much for electricity. The cost of fertiliser has also rocketed in recent years, with many UK manufacturers saying it is no longer cost effective to produce when importers can source cheaper energy. With liquid natural gas being a key ingredient, it's cheaper to simply import it from abroad, except when fertilizer supplies are cut off by the current US-Iran war.
Net zero and government costs
Carbon dioxide is a by-product of making fertiliser and is vital to keeping food fresh, but the last CO2 plant was shut down as the government favoured imports from Europe. Now a British plant is being re-opened at a cost of £100million to provide much-needed national resilience.
The Institute of Economic Affairs reported earlier this year that the estimated cost of hitting net zero by the middle of the century could be as high as £9trillion. Grid balancing alone, the practice of paying billions to gas-fired power plants to provide replacement power, is said to have cost a third of the rise in last year's domestic energy price cap.
Higher energy costs for heating, refrigeration and transport are all footed by supermarkets, so it's no surprise when that means product prices have to go up. Chancellor John Healey says he's on the look-out for price gouging by retailers, when in fact the Government is the biggest price gouger of all – adding pounds to our shopping bills with inflated costs of employment, taxation and energy inflicted on us by Labour policies. Almost a quarter of a pint of beer is tax. Over half of the price of petrol goes to the HMRC in fuel duty and VAT.
Burnham's gimmicks won't help
When Andy Burnham smirks into his smartphone in his latest TikTok message, Newark says to bear all that in mind. Every little price-cut gimmick he announces will hardly touch the side of the enormous cost-of-living hole we are stuck in. That's because he will not address the real elephant in the room – the huge cost of maintaining the vast government machine he is devoted to, with its ever-increasing wages and pensions and obsession with doling out ever more benefits.
As he travels around Britain this week, the PM should realise that it is in fact Labour that's costing us too much. We can't afford it and need to get shot of it as soon as possible. That, Newark assures, will save us all a few quid.
