MILLIONS of working-class households, and not a few middle-class ones, are looking ahead with great trepidation to the tsunami of energy costs that are coming our way.
The TUC estimates that energy bills are rising 14 times faster than wages.
The bare facts are that average wages may rise by 3.75 per cent while the price cap on gas and electricity set by Ofgem will go up by 54 per cent in April.
Average in this context always means that some people will see little or no rise.
For P&O workers the drop in income is precipitate and they are not the only group of workers who face the ruthless exercise of boss-class power which our deregulated labour markets and anti-trade union laws permit.
This unprecedented increase in the cost of living will be boosted by an increase in National Insurance of 1.25p in the pound which will see pay packets shrink just as outgoings rise.
It is the low paid and people on low incomes who will be hit hardest and this follows on from a decade of wage freezes across the public sector which has acted as a brake on incomes across the whole economy.
To this is added the drain on working people’s incomes and savings by the coronavirus pandemic which has frozen incomes for many and reduced them for many more.
For millions of people who commute to work rail fares have shot up by 3.8 per cent and there is an unceasing rise in petrol costs.
The old ruling class trope — that wage rises fuel inflation — is shown to be a fallacy. Inflation reached a three decades high last month at 5.5 per cent.
Labour has called for the National Insurance rise to be cancelled but the government has shrouded this hit and run on workers’ wages as a hypothecated increase to deal with the extra costs of the herculean NHS effort to deal with Covid.
There would be just a glimmer of justification for this approach to the public funding of our health service if the government had not already spaffed up against the wall billions in wasted expenditure on failed test and trace programmes, useless protective gear and filled the pockets of private health contractors with its stealth privatisation of the NHS.
Best case estimates are that the conflict in Ukraine will add 30 per cent to energy costs, although even without the German-Russian Nordstream pipeline project, which the US insisted should be mothballed, gas flows through Ukraine from Russia have not ceased.
The complex economics of energy supplies have been rendered less opaque by the sharp-eyed economist Professor Richard Murphy, who points out that just over a third of a typical household energy bill will be made up of the actual cost of the energy, the remainder being taxes, delivery costs, environmental levies, “customer” services and especially important, profit.
Much of the price rises that are coming our way arise not from any additional costs of production but from the working of the capitalist energy market where prices rise as the monopolies rush to secure future supplies.
France, where President Emmanuel Macron faces a presidential election, has capped domestic energy costs and imposed a big levy on energy company profits.
Short of a continent-wide socialist revolution which would dispossess the energy oligarchs, there are limits to what even a progressive British government could do.
It isn’t rocket science. It entails a return to a unified and publicly owned energy supply industry which the private appropriation of profits stripped out and transformed into extra investment and reduced energy costs. To which we can top the French example with a massive levy on energy monopoly profits.
