The aptly nick named ‘MissTrust’ who said she would deliver, deliver, deliver. Shame she didn’t tell us all what she was going to deliver — except a blow to the poorest in the land. Even as a ‘Tory’ I find this reversal of the Robin Hood fable of robbing the rich to pay the poor, the equally confusing and difficult to pronounce Kwasi Kwarteng has turned up as the Sherrif of Notingham, and is robbing the poor and giving it back to the rich!
It is prices that cause inflation not wages. It’s fuel that contributes to the cost of everything that we eat, drink, wear and travel. A price freeze is one of the basic controllers of inflation. Fag pack accountancy; With BP alone in the UK making 30 plus billion this year and monthly sales of fuel being some 38 million litres, the duty content of that is 22 million. BP (alone there are others) make 2.5 billion per month. If the petrol companies pay the fuel duty to the government directly the government can afford to remove that from a litre at the pump reducing a litre by 58p. That would save a windfall tax levied on the companies and make it redundant and also would allow a tax write off for the petrol companies for the next couple of years. VAT is 20% if the government removed 10% of that this would bring down the cost per litre to 1.32 at the present day prices. The price of oil will go down over the next few months as well. The reduction in VAT would be replaced by the increase in sales across the UK in every market place attracting more VAT. Exactly the same principles could be adopted for utility companies, who make excessive profits too, plus get rid of the green tax (where does that go anyway? — bet it’s not ring fenced) and reduce VAT by 10%. The electric/gas companies reduce the average bill under 500 a month by 50%. The government reduce the VAT by 10%. The facility companies can then write it off in tax over the years. With a broad brush stroke it would reduce costs immediately DIRECT to the consumer and avoid huge borrowings for the government. I’m sure an economist would shoot the theory down in flames, but the basis must be a sound idea!