James Heappey, who received a pay rise two weeks ago, spoke less than an hour after figures officially showed the cost-of-living crisis “has arrived” and regular salaries fell 1.8% after inflation
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A top Tory earning £106,000 after a pay rise has complained he is “worried about my overdraft” – while Brits suffer the biggest pay drop in nine years.
Experts said the cost-of-living crisis had “taken hold” as official figures showed regular wages fell 1.8% in the three months to February following CPI inflation.
The same figure, but month-on-month through February, shows a 2.1% drop, the largest since August 2013, according to the Office for National Statistics (ONS).
The Resolution Foundation warned of a gap between the public sector, where wages fell 3.8% in real terms, and the private sector, where they fell just 0.8%.
And today even Armed Forces Secretary James Heappey said he felt the pinch – despite an April 1 pay rise that took his salary to £106,619 a year.
Asked if he would release his tax return, as Chancellor Rishi Sunak’s people are asking, he told LBC radio: “I have to be honest, my finances are pretty straightforward.
“And like many people, on the 20th of the month I’m more concerned about my overdraft than any amazing taxes [inaudible].”
It comes days after another £115,000 Tory minister, Kit Malthouse, said the rise in energy prices had hit him “very badly”.
Mr Heappey added that although his tax return is very simple, he would resist calls for it to be made public because “actually I think MPs should be entitled to some level of privacy”.
Mr Heappey spoke less than an hour after the ONS released updated figures on weekly earnings lagging behind inflation.
According to the ONS’s preferred CPIH inflation measure, real non-bonus regular wages fell 1% in the three months to February. The same calculation shows on a monthly basis that regular real wages fell by 1.3% in the year to February.
The same numbers using CPI inflation were 1.8% and 2.1%.
While wages rose 4% in the quarter, inflation far outpaced them. And experts are warning that the cost-of-living crisis is set to get worse as inflation peaks at nearly 9% later this year.
Chancellor Rishi Sunak said the government was helping “to cushion the impact of global price increases by providing over £22 billion of cost-of-living support this financial year”.
But business groups said homes and businesses were already being weighed down by staggering price hikes.
Pat McFadden, Labor’s shadow chief secretary at the Treasury, said: “Rishi Sunak could have opted for a one-off windfall tax on huge oil and gas company profits to cut household energy bills by up to £600.
“Instead, he has decided to make the UK the only major economy to attract working people with higher taxes amid a cost-of-living crisis.”
Darren Morgan, director of economic statistics at the ONS, warned: “While strong bonuses continue to mitigate the impact of rising prices on people’s overall income, base pay is now falling appreciably in real terms.”
The latest ONS jobs data also showed that the jobless rate fell further below pre-pandemic levels at 3.8% in the three months to February, its lowest since December 2019 and down from 3.9% in the previous one three months is period.
In the quarter to February there were 86,000 fewer unemployed Britons, at 1.3 million, while the number of people in work rose by 10,000 to 32.5 million.
However, the Resolution Foundation warned: “A buoyant labor market does not generate much wage pressure, especially when furlough base effects are taken into account.
“And as inflation rises, the wage squeeze in the UK will only get worse.
“The current decline in real wages is not expected to end before the end of 2023 and leave average wages no higher than 2007.”
HM Treasury / Handouts)
TUC General Secretary Frances O’Grady called for an emergency budget from Chancellor Rishi Sunak.
She said: “Everyone should have the security of being able to pay their bills. But household incomes are being wiped out as wages cannot keep up with the rising cost of living.
“It can’t go on like this… Increasing need is a political decision. Ministers must not abandon families in their hour of need.”
Stephen Evans, chief executive of the Learning and Work Institute, said: “This February, people saw the largest drop in regular wages in a single month since December 2013. But this cost of living crisis is not being experienced in the same way.
“Bonuses in sectors like finance mean some are seeing wages rising, while benefits for those on the lowest incomes rose just 3.1% yesterday, far less than inflation. This is before the rise in Social Security and the energy price cap, so the pain will only increase if nothing is done.
“Meanwhile, we continue to see people exiting the labor market altogether, particularly caregivers, retirees and the long-term sick.”
https://www.mirror.co.uk/news/politics/tory-106k-says-im-worried-26692617 Tory over £106k says 'worried about my overdraft' as UK wages fall at worst in 9 years