Living standards: no wonder people are angry

Reflections on standards of living in Wales today

The Bevan Foundation has published the results of its ninth living standards survey. Having overseen the previous eight surveys, this time I have had a bit more time to reflect on the findings. And very interesting they are too.

The headline message from the Bevan Foundation is that the pressure on living standards is easing. The survey found that the proportion of people who sometimes, often or always struggle to afford the essentials stands at 12 per cent, slightly down on the proportion two years ago. The proportions cutting back on meals for children and on heating are also slightly down, as is the negative impact on mental and physical health.

But the decreases are neither large enough nor long-term enough for any sense that the pressure on living standards has eased. There are still far, far too many people struggling to afford food, heating and warm clothing.

Most of us have had to tighten our belts in the last few years. The Institute for Fiscal Studies estimated that the poorest forty per cent of people are on average £1,800 a year worse off in real terms than in 2010, with families with children being especially hard hit. There is little prospect of change. The Resolution Foundation forecasts that the income of a typical working-age household will increase by just 1 per cent by 2029/30 – that’s barely perceptible to most people. Even worse, the poorest half of households are expected to be worse off by this date [ those on the very lowest incomes will be an eye-watering 8 per cent worse off by the end of the decade – equivalent to £20 a week.

What can we make of this truly grim set of findings and forecasts?

• First, the poorest forty per cent of us are worse off and the richer fifty per cent of us are better off by design – the result of decisions on tax and benefits taken by successive governments since 2010.
• Second, deliberately impoverishing a large proportion of the population has knock-on effects. Public services are taking a big hit, for example poverty contributes to poorer health and so increases demand for health care. Similarly, static incomes while rents are soaring increases homelessness.
• Third, cutting the incomes over a prolonged period, coupled with huge pressure on public services, is guaranteed to create widespread discontent – as indeed it has. No wonder there is a nostalgia for the way things were. But instead of blaming past governments for key decisions, a convenient scapegoat has been found in migrants.

I fully recognise that it is very difficult for governments at all levels – local, Welsh and UK – to turn back the clock or change tack. But they must do so as a matter of urgency, not only to provide people with a standard of living they should reasonably expect in the fifth richest economy in the world, but also to give hope for the future.

The alternative is a slide into a type of politics and society with which I am deeply uncomfortable.