Different lives, different values

After opening the nation’s wallet to the tune of a billion pounds for the DUP, in their desperate attempt to cling to power, the Conservatives were feeling generous this week. It was reported on Tuesday that they’ve awarded the Queen a juicy 8% pay rise, increasing her taxpayers’ grant by a cool £6 million a year to £82.2 million.

Income

The following day, the DUP began to earn their billion, teaming up with Tories to narrowly vote down a Labour amendment to the Queen’s Speech, and so vowing to maintain public sector pay rises to a maximum of 1% per annum. This is well below inflation, currently running at 2.9% and forecast to increase.

In addition to their 1% salary increase each year as public servants, just two years ago MPs voted themselves an expansive 10% pay rise, taking their annual salaries from £67,000 to £74,000. The average salary of a FTSE100 CEO increased by 30% from 2010 to 2015, and if £4 million a year wasn’t enough to stop at, what are the chances that £5.5 million will be?

IFS: Incomes are 10 percent below trend
Source: IFS

Meanwhile, the income of the average Briton has grown just 5% in the decade since 2007-08. This is 10% below the historical trend level – signifying a loss of about £3,400 per household each year thanks to our glacial, unequal ‘recovery’ from the recession. Truly Robin Hood in reverse.

Capital

FTSE100 growth from 2003 - 2017
Source: TradingEconomics

This loss of income isn’t mirrored in the capital holdings of the rich. Stock markets have recovered all of the value lost in 2007-08 and soar onto new heights every month. Average house prices have risen by 50%, and by significantly more than that in London and the South East, entrenching the wealth of those already owning or inheriting capital.

Rents in turn have risen and are set to outpace house price growth. While around 2% of the general population are landlords, 30% of MPs rent out property. In the last two years the Conservative government twice defeated bills designed to ensure landlords are renting property that is at least fit for human habitation.

Taxation

Corporation tax (avoided by multinationals, regardless of its level) has been slashed from 30% in 2010 to 19% now, and last year tax on capital gains (the method by which the wealthiest privately appropriate social profits) was reduced from 28% to 18% for the higher rate and 18% to 10% for the lower rate. Meanwhile council tax, which regressively charges the poorest the highest percentage of their income, has risen by 2%, and in the last year by up to 5% in some boroughs.

Due to falling government contributions, council spending on neighbourhood services has generally fallen by up to 22% in the poorest areas, but already very well remunerated council leaders have still found the breathing room in their budgets to award themselves healthy pay rises for their hard, hard work. Over 2000 of them across England and Wales earn more than £100,000 per year.

One of the most egregious examples can be found in Tiverton, very close to home for me, where Local Enterprise Partnership chief executive Chris Garcia, who manages a team of four full-time members of staff and budget of just £1.6 million, recently awarded himself a 27% pay rise, from £90,000 to £115,000 per year. The county council were powerless to stop him, their vote against the proposal being only advisory.

Investment

Returning to royalty, late last year a £369 milllion refurbishment was announced for Buckingham Palace, and MPs look set to approve comprehensive repairs to their place of work – the Palace of Westminster – estimated to cost in excess of £4 billion.

Spurred by decades of double-digit growth in property prices, London has seen a boom in the construction of stunning, luxury tower blocks. They might provide jobs in construction, and stamp duty for central government, but many are bought only as investment vehicles for the internationally wealthy and lie largely empty.

Grenfell vs St George Wharf

At the same time, over a million are on waiting lists for council housing in England alone. In their recent £8.7 million renovation of Grenfell Tower, it is now known that Kensington and Chelsea council were urged, and opted to save £300,000 by fitting a cheaper, less fire retardant form of cladding on the outside of the building. They also chose not to fit a sprinkler system, and some residents report fire alarms failing to go off. This low value placed on the lives of their social housing tenants is highly likely to have led directly to their deaths – at least 80 – in the appalling fire earlier this month.

Kensington and Chelsea weren’t alone in so comprehensively sacrificing safety. Up to today, cladding samples from all 137 high-rise buildings tested so far across the country have failed the government’s fire safety tests. But what did Kensington, one of the wealthiest councils in the country, do with their enviable ‘efficiency savings’? They gave them back to full-rate council tax payers as a one-off £100 rebate in 2014. Cashback on each human life.

Austerity for some

Remember that, as it looks set to continue everywhere except Northern Ireland, austerity is only for some. The other half are having the best times of their lives.

2 thoughts on “Different lives, different values”

  1. On the same day I posted this, Greenpeace reported that “one in five of the 100 largest payments under the European Union’s “direct” subsidy system now go to people or families on the Sunday Times Rich List.”

    As long as the wealthy make sure they own over 36 hectares of land, they can claim hundreds of thousands from the government just by keeping it “in a suitable state for grazing“, i.e. not doing anything to it and leaving the grass to grow.

    The government have committed to keeping this subsidy until at least 2022, even after we leave the EU.

    While the wealthiest landowners in our country, many of whom simply inherited their land along with their title, already make millions each year simply on the appreciation in value of their land, they’re also paid sums that completely eclipse benefit payments to those with a genuine need.

    Imagine how unhappy the media would be, and how hard they’d fight to convince the public to be incensed, if those on Universal Credit were given thousands of pounds each month as long as they could prove they sat on their arses and didn’t try to do anything productive whatsoever.

    Yet the already wealthy and privileged are actively encouraged to do this, and lauded as the finest exemplars of our species when their total wealth rises year on year.

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