Archive for April 2011

Think the cuts are biting? The pain has hardly begun, Independent

Date: 25. April 2011

Gavin Kelly

Analysis: The most politically dangerous cut will kick in in 2013 - the abolition of child benefit for higher-rate taxpayers

Buoyed by a run of bank holidays and balmy ...

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Think the cuts are biting? The pain has hardly begun

Date: 21. April 2011
Gavin Kelly

Buoyed by a run of bank holidays and balmy weather, optimistic families may think that, having absorbed the changes announced in April's Budget, the worst is behind them. Sadly, that is a false hope. Plenty more pain is in the pipeline.

To see why, just look at what is coming in terms of cuts, wages, and interest rates. The cuts that kicked in on "Worse-off Wednesday" accounted for a mere 10 per cent of the total savings arising before 2015 from changes to tax credits and child benefit. The pain is "back-loaded"; over 40 per cent of these cuts kick in in 2013.

For many, the biggest threat to living standards does not arise from what George Osborne has done but from the impact of higher prices and stagnant wages. This is not a new problem – disposable income has been falling in every region outside London since 2003 – but it is a worsening one. The current wage squeeze is expected to continue until at least 2013, when average real wages are expected to fall to under £25,000, over £1,800 lower than in 2009.

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Flat, and falling, Prospect

Date: 20. April 2011
Gavin Kelly and James Plunkett

Gavin Kelly and James Plunkett 

Will our children earn less than we do?

How much did your parents earn when they were your age? Unless you buck the trend, the ...

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The week when the numbers become reality

Date: 4. April 2011
Gavin Kelly and

With the Budget behind us and the new financial year starting on Wednesday, it is a timely moment to take stock of the prospects of those living on low-to-middle incomes. To do that we need to consider the combined impact of stagnant wages, rising prices, reduced tax-credits and benefits from the June 2010 Budget – as well as the measures that were announced in last month’s Budget (such as increased personal tax-allowances).


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Digging beneath the figures on household disposable income

Date: 1. April 2011
Lee Savage and

Figures released earlier this week by the Office for National Statistics showed that total real disposable incomes have fallen in the UK for the first time in thirty years. But behind those headline figures, if we instead look at disposable income per head, there’s an interesting story about the performance of different regions across the country. In particular, strong growth in London is masking a much longer term squeeze in living standards in other areas – and one that long-predates the recession.



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