Sandie Seward
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The Truth about Inflation.I've just been reading an article in the Daily Express about Train Drivers who work for South West Trains are to strike for four days at the end of the month. The reason? Pay Levels. They have been offered 4,2% increase on their £40,000 Salary.
Sounds good? Well, yes, in theory, but put it into actual real figures and it is not so good. The "real" rate of inflation is far higher than the "official" government figure.
Let's assume that these Drivers have a mortgage, a vehicle loan, Council Tax, Income Tax, and other commitments, including Credit Cards, possibly an overdraft with the bank, and various other Hire Purchase agreements.
Lets also assume, that by the time their salaries enter their bank accounts, deductions for Income Tax and National Insurance, Union Dues, and a Pension Scheme, this will reduce that salary by two-thirds.
So their actual "Take-Home" pay would be much closer to £30,000 than £40,000.
If the Driver also has a family, then big inroads into that money have already been made. So although the initial figure looks pretty impressive, once reality starts to kick in, it doesn't look quite so good.
Train Drivers are not the only ones feeling the squeeze. Other workers who earn above the "Minimum Wage" are also feeling it.
Then of course, there are the people who just earn the Minimum Wage, and are forced to apply for State Help with their basic living expenses.
Pensioners, are also getting into dire straights especially if they have a small Works Pension as well as the Old Age State Pension.
Having a private pension, puts them just over the level where they can apply to the State for help with their Council Tax and Rent.
They would have been better off, not saving or paying into a Company Pension scheme, and simply relying on the Country to help them live.
Britain , is the only country in the Western World, where to be thrifty and careful with your earnings, doesn't reap any benefit whatsoever.
Those Train Drivers are not the only one's suffering. After almost twelve years of a New Labour government, and it's subsequent mis-handling of the Nation's Finances, everybody is suffering.
Sandie Seward c. 2008. (This article was first published in my Newsvine Column.)
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