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02/04/2008 08:59 PM ID: 68239 Permalink   

Why Do We Feel So Broke?


The Centre for Policy Studies in the UK has released a study entitled 'Why do we feel so broke' in which it describes how fragile the UK economy really is. It claims that family budgets are nearly £1000 worse off than 5 years ago.

The research labels increasing tax burden, rising fuel costs and high interest rates as causes for the downturn in people's finances. It also states that things are set to get worse as the economy slows and the government plans new taxes.

The increase in debt is also a factor that makes UK households more vulnerable to a slow down in the economy.

The tax burden is said to have risen by £7,800 per household since Labour took power. Interest payments are up 80% from 5 years ago.

    WebReporter: Maxx20 Show Calling Card      
ASSESS this news: BLOCK this news. Reason:
  Saw this  
and thought it tied in with the story about people escaping to Australia. It also goes a long way to explaining why so many of us over here don't have houses.

There's more at the source, a couple of facts / figures; In 5 years time the tax burden is expected to be the highest in 24 years. In the past 5 years, electricity bills up 68% and gas 52%. Not looking good.

Of course all the while, they're taking more tax, keep taking till there's nothing left. Then the country breaks.
  by: Maxx20     02/04/2008 09:06 PM     
  We shopul;d just show our Government the door  
Why should we leave our country because some nerd gets on ego trip and is allowed to just carry on doing what ever they want it is plain stupid? It can end!

Within a few years this lot of so called politicians will be away with all we have and make a life somewhere away from the devastation they have left behind.
  by: captainJane     02/05/2008 12:57 AM     
  That should have been-..  
We should just show our Government the door.

I think I need new glasses.
  by: captainJane     02/05/2008 01:00 AM     
Enjoy your free health care!
  by: greatwarrior1   02/05/2008 01:02 AM     
  Its quite simple  
Real inflation, as in the goods we buy every week and need to buy in order to live, is much higher than the Consumer Price Index measured inflation.
CPI being a basket of goods that weights a champagne weekend in paris higher than a loaf of bread or a gallon of petrol.

Labour would make Goerballs envious, presiding over the biggest drop in wealth of the "working man" since, well, since they were last in power, and still the fools vote for them.

Ranted a bit there

Labour says inflation is 2%, which it is, if you only consider the cost of flat screen TV's and iPods.
If you add in those unimportant items like food, fuel and eolectricity, its rather higher.

Found the actual measure.

Food and Housing makes up 21.8% of inflation.
Recreation, Restaurants and Hotels makes up 29.1% of inflation.

Who think eating out is more important than eating and having a home?

The Government....
  by: AnsweringQuestions     02/05/2008 09:45 AM     
but if that is representative of current spending then it would be valid. ie. If most people in the UK eat out then it would be valid. Eating out is fairly common in larger cities and when both people in a relationship work.

Although I would agree with you that it seems that the restaurant and hotel weighting seems rather high. For the UK.

If you want you can compare with the australian CPI calculations here. Everything is available for you. Explanatory notes, Excel spreadsheets, etc. Very good website.

here are the weightings currently based on Sept 2005 statistics.

You'll see that hotels and travel is only 4%. Restaurants is 2% and takeaway is 2.5%. So we have that category at 9.5% weighting, but in the UK it is 13.8%.
  by: jendres     02/06/2008 12:55 AM     
Yeah, governments love providing statistics that have little to do with the reality of things. Inflation is no exception.

Funny thing is, when we study history we can easily see that we've been having high inflation throughout the years.

IMO where we're headed is towards hyperinflation (I'm talking about the US here). But as you already know, what affects the US will ultimately affect the UK.
  by: QuestioningAnswers   02/06/2008 01:00 AM     
But it doesnt represent what most people spend.
Most people spend 25% of their income on housing costs, some as high as 50%.
But the CPI says 10%

Just as an example of how stupid the numbers are, average wages are £25,000 of there abouts.
10% on housing would be £2500 a year, or £208 a month.
You cant get a 1 bedroomed flat for that anywhere I know of, and I dont live in Central London.

The statistics are designed to keep inflation low, not be accurate, hence my complaint.
Maybe they were valid at one point, but they havent been for some time.

"IMO where we're headed is towards hyperinflation (I'm talking about the US here). But as you already know, what affects the US will ultimately affect the UK."

Opened my bullion vault yesterday.
  by: AnsweringQuestions     02/06/2008 09:32 AM     
Just an off-the-cuff look @ my spending % figures...

Out of post-tax income, first 50% that I can quickly identify:

Home: 40%
Council tax: 5%
Heating / lighting: 2%
Car Insurance: 2%
Car tax: 1%

So, that's 50% gone before I add home insurance, water bill, TV licence, petrol (although i don't drive much), other car stuff (MOT, service, replacements), eating, going out and all the rest of it.

There's nothing left over @ the end of the month, that's 4 sure.
  by: Maxx20     02/06/2008 10:47 AM     
  I would never...  
...dream of bringing a child up in this country unless I was very rich as it would probably just struggle to make ends meet like most of the people I know for its entier life until it finally retires on a terrible pension.

The problem is that everything in the country has just about doubled in price over the last 15 or so years apart from wages which stayed pretty much the same, taking into account natural inflation. Industry here is absolutely awful. Most people sit in a call centre for 8 hours a day lining the pockets of some greedy, morally void f*ck for a piss poor wage which just about covers their rent payments and food. Although of course it often doesn't meaning people have to give Ocean Finance a call, consolidate their debts and dig themselves further into the sh*t.

The time when you could be proud the be English has long gone. Unless you earn a hell of a lot of money in this country you're going to be stuggling to simply survive your entire life, especially in recent times
  by: barryriley   02/06/2008 11:42 AM     
  Britains own fault  
For not joining the Euro Zone... Or maybe this is just a preparation for it, the gouvernment testing out how much the population can take before they beg for the euro...? Good plan :-)
  by: evilrat   02/06/2008 01:23 PM     
What would joining the EuroZone have done?

The Euro has lower interest rates than the GBP.
Had we joined the Euro, inflation would still be storming ahead, well, no, it would have been storming ahead for 5 years already.
  by: AnsweringQuestions     02/06/2008 01:37 PM     
As I understand it, wages have gone up loads, only we haven't benefitted at all because the government saw it as an opportunity to cash in. So while the gross effect of our successful economy has been people becoming more well off, the net effect has been stagnation. In fact recently, the effect has been that we have the lowest amount of left over income in years. In my case, about £10 a month, lol.
  by: Maxx20     02/06/2008 02:09 PM     
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