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Living Standards

I shall give way in a moment. The weakness in the jobs market is not abstract; it shows up in people's pay packets. That is exactly what the Office for Budget Responsibility confirmed yesterday. Earnings, it says, are now set to fall throughout the rest of this Parliament. By 2016 wages will be no higher than they were in 2001—£1,400 below their pre-crash peak—yet prices are not falling; they are rising. Prices are going up over the course of this Parliament. Wages are falling and prices are rising. That double whammy is now hurting families all over this country. Not long ago, the Governor of the Bank of England said that we in this country now confront the worst squeeze on living standards since the 1920s. Yesterday, the Institute for Fiscal Studies said that the squeeze was ““unprecedented””. This is the biggest fall in household income since records began. With our nation's family budgets under such pressure, we would have thought that the Government would step in to help. Not a bit of it. Instead, working families are being asked to pick up the pieces.