Just tried to find some quick and dirty reasons for the (high) rise in cost of living in the period from (1st Jan) 2008 to date. Just the decline in the value of Sterling against both the USD and the Euro in the intervening period*, coupled with a steady rise in dollar based oil and gas prices (hence huge energy cost rises, particularly for gas and petrol) accounts for much of the increase for the great importer that is the UK.

I would guess that bus fares are less and less subject to local authority subsidy these days and they have to be rationalised to make a profit from actual fare payers as presumably they don't get the full notional fare from bus pass holders . Then there's that fuel thing.

I seem to recall that a big 'beef' regarding the 'recovery' is the fact that the UK has not been able to take full or proper advantage of its relative decline in recent years against such currencies as the USD and Euro in areas such as manufacturing, which might have helped to underpin wages if there had been a true export led recovery or march of the makers. Part of the problem seems to be that EVERYBODY can't be an exporter so only those who have the best in attributes - investment, innovation, training, skills, productivity, management skills (all areas where the UK seemingly typically falls down) succeed. That said, 'exports' of business services are coming through as a significant source of foreign exchange and growth and jobs at the somewhat higher categories of staff and management. Outside of business and financial services one would now expect average wages to be lower in real terms in light of employers' better positions on wages, contracts and union negotiations. Indeed, part of the reason that there has been less effort in obtaining greater productivity appears to be the access to cheap and cheaper labour.

I was horrified when reading an article in yesterday's Guardian/Observer to note that the Dept of Justice Shared Services division which handles procurement for the Prisons system, amongst other things, in Newport Gwent and Bootle Merseyside is now being partly outsourced under a 25/75% share back office joint venture with a French company to effectively 'export' UK jobs to India. The affected union is on strike today.

I would say, in passing, that over the last few weeks there have been several articles regarding family and single costs of living and the numbers seem to be fairly repetitive, scary though they are, but then those of us who would be retirees would not have to worry about national insurance on the expense side, or possibly bus fares. Of note also was the fact that 50% of the UK population now absorb more in services and benefits than they input in overall taxes and NICs. Lots of googling to do.


* Sterling hit a nice high around Christmas 2007 against the USD.

The nett contribution point is one that was rubbished by the BBC some months ago when it was first made, by the CPS I believe. Or it might have been the IEA. But it is a valid one.
Inflation costs you mention are included in the normal measure of inflation. I think the problem is that Rowntree changed the comparators they were using - entirely. Took out landlines, substituted I-phone contract etc etc. Took out Sky subscription, put in Sky plus and Skysport.
So what their report actually says is "a family that buys more stuff spends more than a family that buys less stuff". Although that is not how they present it.
Services exports are an interesting case in point. Manufacturing is increasingly an automated process, so not too many jobs there. It seems only sensible to me for a country to concentrate on those areas where there ARE lots of (high-paid) jobs.
The real question arises as to what happens as fast chips eat into professional services. Basic Accountancy and legal services seem to me to be heading the same way as metal bashing , and I am sure there are many other areas that Moores Law will automate in the near future.
In the past, humanity has always found new forms of work to replace those supplanted by machinery, but I cannot for the life of me see what those new occupations are going to be. The only thing I am sure of is that the UK is an incredibly dynamic and innovative country, even more so with 20 odd million new hungry and intelligent immigrants. If any country can crack it, we will.

Well very definite signs of continued improvement in the economy, job figures looking better every month, business and consumer confidence improving, just the general feeling is so much better than even a year ago. Not all positives obviously but overall definitely positive.

From the attached link..........

<The economy may have created 774,000 new jobs in the past 12 months but many of them have been in low-paid sector. The result is that wage stagnation is keeping income tax low. >

Just how big is Britain's debt mountain? - Telegraph

The debt mountain just keeps growing, despite job growth and cutbacks ( I use the terms loosely ).

The scale of debt is astounding. Oh what we, as a nation, could buy without having to pay all that interest.

Seems most of the world's countries are going increasingly into debt, which begs the question: Who are they all borrowing from? (China/Middle East?)

From a google search.

https://answers.yahoo.com/question/i...6113504AAED2pX

Debt to GDP ratio is more interesting as that's really a measure of how the debt can be managed:

I have made that very point several times and been shouted down. It stands to reason that if formerly unemployed people are brought back into work, they are likely to enter at the lower end - not too many unemployed brain surgeons and tax accountants. The same for the majority of new immigrants. Wage growth across the economy will stay moderate until one of those or both slackens off.
Underlying wage growth for those in work however is also likely (IMO) to be affected too as employers, seeing the headline rate, are likely to scale offers down.

The growth of the debt pile is not finished yet. The cost of renationalising Network Rail is now on the books, but a lot of the PFI deals are still not. It may be the cynic in me but I wonder if that is because it has also been used in the rest of Europe, and might make other EU economies look even worse?
Also if 4G is treated as income surely 3G should be reclassified too?

None of which means the UK is in a worse position than it was. It just makes the awful position (horribly) clearer.
I have always thought it was going to take twenty or thirty years to clear this mess up. I still do.
And we haven't done five yet!

Better news again. The IMF - those guys who said the UK would go down the toilet unless the Coalition abandoned its plans- now are almost holding the UK up as a poster child!

IMF Survey : Global Growth Disappoints, Pace of Recovery Uneven and Country-Specific

Trouble is France looks over optimistic, and if Germany looked uncertain before, oil below 90 dollars is going to remove Russia as a buyer of Mercedes and BMWs - and much of the Middle East too.

Yes that certainly backs up what we are seeing and the general feeling in the country.
Car sales are always thought of as a good indicator and new car sales have risen for 31 consecutive months.