Wednesday, 17 October 2012

Young people paying the price

Sheffield’s young people are paying the price for this government’s economic failure, as long term youth unemployment in our area continues to soar.

Today’s national unemployment figures are masking an increasing crisis in Sheffield and our region.

There is no let up for young people in Sheffield who are increasingly shut out of the job market because of this Government’s economic failure.

Long term youth unemployment in Sheffield has increased by 149% - from 490 to 1220 - in the last year. Each of those is a tragedy, and the government’s lamentable failure to act leaves them with little hope.

And, there were just 3,652 vacancies for the 18,023 people looking for a job in the city.
There is now a real danger that Britain is becoming a very divided country. Yet the government is busily taking money – in local government, public health, transport, education and more - from the areas with the biggest challenges and giving it to those areas in the south-east with the least.

Long-term unemployment has risen yet again. The number of young people out of work and claiming benefits for more than a year went up yet again, and three-quarters of Britain has higher unemployment than at the election.

More than a third of people out of work have been jobless for more than a year in the clearest sign yet that the Work programme is not doing the job.

The national increase in people in jobs has come from an increase in those in part-time jobs or on temporary contracts.

Energy prices up – do something

Did you, like me, have a letter from your energy supplier this morning?

Did it tell you that prices are going up, but not by how much? Well, it’s an open secret that energy prices are likely to rise by 6-9% in the next two months.

Energy prices went up by 20% last year, and nearly 50% over the previous four years. Last year, the average duel fuel bill was £1345 per household and standard tariffs rose by £175 between May and October. Pensioners, families and businesses all felt the squeeze as electricity prices rose by 10% and gas by 17.4%.  Yet, energy companies had seen their profits soar in the same period.

And, what was the government’s response? It cut winter fuel payments by £50 for the over 60s and £100 for the over 80s. Most aged 60-79 got £50 less, and those who were 80 or older got £300 instead of £400. Before the last election, when challenged that a Conservative government would cut the winter fuel allowances, David Cameron had said “These are quite simply lies.” You can draw your own conclusion.

Energy bills are now one of the biggest costs facing households - but only 20% of people are currently on the cheapest deal. This isn’t surprising when research by consumer group Which? showed that, even when people try to shop around for a better deal, energy companies don’t give them accurate information in a third of cases.

It’s clear that hard-pressed families and businesses need more transparency on costs, pricing and profits to know whether they're getting a fair deal. But they’re clearly not going to get much help from this government, which shows no interest in protecting struggling households and vulnerable customers from being ripped off.

However, a new initiative launched today might just help. Switch Together helps people to club together to negotiate a cheaper deal with energy companies. You may have seen websites where you can compare energy costs to find the cheapest rate. But this is different because if lots of people get together and switch all at once, there is greater potential for a good deal. This is what Switch Together scheme does.

It's easy and safe, and support and guidance is available throughout the registration and switching process.

You need to register before 25th November 2012. After the deadline they'll hold an auction with energy companies to find the cheapest deal - which will then be available to everyone who signs up. They’ll do all the work for you and let you know if you could save money.

There's no obligation to take it if it's not cheaper than your current deal - but the more people who sign up, the more likely it is that it will help households cut their costs over winter.
Sign up at before 25th November 2012.

Tuesday, 16 October 2012

LINE UP – we’re being taken for a ride

This week, SKY announced that it will increase phone line rental charges by more than seven times the rate of inflation from December. The line rental charge will jump from £12.25 to £14.50 a month – that’s 18%. Sky is also increasing the cost of daytime calls, from 7.95p to 8.41p a minute and its call connection fee will go up from 13.1p to 13.87p.

Similarly, BT has announced a rise in line rental charges £14.60 a month to £15.45 from January 2013. And, BT’s call charges will also go up. Full-price daytime calls will rise from 7.95p a minute to 8.41p and the call connection fee will rise from 13.1p to 13.87p.

Virgin and TalkTalk have already implemented way-above-inflation increases in line rental charges, but BT and Sky are the dominant domestic telecoms suppliers.

There are a number of things that strike me about these announcements.

First, what is the justification for these inflation-busting increasing line charge rentals? I can’t think of one. One telecoms supplier – Primus – charges £8.25 a month. It uses the same infrastructure as the other suppliers. Is it subsidising its line rental costs? I don’t think so. So, why are the dominant suppliers charging nearly 90% more for that part of the bill which is inescapable?

Secondly, increasing the line rental charges means that those who make the fewest calls – typically pensioners on the lowest incomes – are facing the highest percentage increases in their bills.

Thirdly, in what the suppliers call a ‘highly competitive market’, how do BT and Sky manage to arrive at exactly the same costs for daytime calls and connection fees? Is it coincidence? I don’t think so.

That’s why I’ve called on the Competition Commission and the Secretary of State for Trade and Industry to launch an investigation into the telecoms’ suppliers and, particularly, these latest announcements.

Monday, 15 October 2012

The straw that breaks the camel’s back

90% of the benefit cuts, that the government has announced so far, are yet to be implemented. And, because the coalition government’s economic strategy has failed, David Cameron has announced that an additional £10bn cut in the welfare budget must be made. The media were briefed that these additional cuts would be targeted at financial support for people in work.

Already, changes in the rules on eligibility for working tax credits have had a big impact on families who have been unable to increase their working hours. From next year, changes in housing benefit and council tax benefit will hit many low income working families very hard.

Let me tell you about Janet.

She left school at 16 and went straight into full-time work. It was low-paid and the prospects were poor. Later, she started evening-classes, got some qualifications, but had to move away from home to get a better job, but her bigger income was swallowed up by rent and travel costs.

When she was 25, she met Paul. Like her, he’d also got on his bike to find a job. They saved up and got married 2 years’ later, but found that, despite both working full-time, they would never be able to buy a home in London and the high rent meant there was little spare cash.

Paul was offered a job back home in Sheffield. They jumped at the chance, found a private flat to rent and, after a couple of months, Janet also got a part-time job. House prices were increasing rapidly, again out of their reach. They put their name down on the council’s waiting-list.

Then, Martin arrived; they hadn’t planned to have a baby then, but they were delighted. Janet gave up work to look after him. When he was 5, they were offered a three-bed council house; it wasn’t in the area they wanted, but they’d make it their home. Janet went back to work part-time. They paid full rent and council tax. They put all their spare money in to decorating and furnishing the house just as they wanted; they never borrowed for anything.

And then, when Martin had just started secondary school, Paul became ill. The cancer was ravenous. He had to stop work and, as he became more ill, Janet gave up work to look after him. Last year, Paul died. Janet and Martin were devastated. The funeral costs wiped out their savings. Janet’s mum gave them a lot of support, travelling 30 miles to stay with them for two nights each week. They’ve had to make a new life.

Janet has now got a part-time job, but her employer can’t offer her the extra hours necessary for working tax credit. Financially, they can keep their head just above water. But, she’s worked out the sums. Next year, she’ll have to pay more council tax, because of the government’s cut in council tax benefit. And, now, they’re deemed to be living in a house which is too big for them; so, her housing benefit will be cut as well. Together, she’ll be about £20 a week worse off. If she moves to a smaller home – from the one they’ve carefully made into a home over the last 7 years – she can’t afford to re-furnish it, and her pensioner mother would have to sleep on the couch.

Janet and 39 other similar Janets will be facing financial catastrophe and family disruption so that a millionaire can have a £40,000 tax cut next year. For Janet, these cuts will be the straw that breaks the camel’s back.