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Mark Hazard #FBPE @Bevanite2017
, 16 tweets, 9 min read Read on Twitter
For the confused amongst you, I'm looking at you Blakeley, this is the basic economics of the situation.

The UK imports 50% of the food we consume.

When the £ falls in value against the $ & the Euro, the price of food we import from USA & EU rises, purely because you get ...
... fewer dollars and Euros to the pound.

You may be familiar with this concept, Grace, if you've ever been on holiday abroad, perhaps for a spot of skiing, at a time of currency fluctuations and had to exchange the £ for the Euro and then back again.
A general rise in prices, Blakeley, is what economists call inflation.

Ah, you say, but we were only talking about food.

True, but oil is priced in dollars so when the £ falls in value against dollar then, for example. the cost of transporting goods goes up across the economy.
Now here's the rub, if you work like Grace for a company like the IPPR and at her level, you'll get salary increases to offset most likely annual rises in inflation.

Does the IPPR have a bonus scheme?

However, if you're on low wages, with little likelihood of a rise or ...
... on a fixed income like Employment and Support Allowance then you're not protected against even low levels of inflation.

The core rate of ESA has not increased by a penny since April 2015 when it stood at £73.10 pw.

Moreover, Grace has surplus income, more than she needs ...
... to live on and so has significant discretionary spending she might reduce without feeling discomforted.

A lot of people, much lower down the income chain don't have such spending to reduce.

They have to cut back on essentials, like food or heating or new shoes for the kids.
People at bottom of the income scale not only spend more of every extra pound they receive than do those at the top of the income scale.

Would you mention that to John, Grace?

They also dis-save to get by.

Raiding the holiday fund is one thing.

But often they resort to ...
... pay day lenders & I suspect still even loan sharks.

I remember the days when child benefit books were held as security & only given back on pay day so claimants might cash their giro to then give the money & book back to the shark.

And, no, Grace, I've never been slumming.
To turn to the benefits freeze, Blakeley, not only is its impact exacerbated by rising prices (of essentials, like food), but Jeremy #Corbyn, who once campaigned against it, has said for some time that his #Labour Government won't be able to afford to end the freeze, if ever.
But Jeremy #Corbyn has pledged his #Labour Party to spend £10bn plus, on its first day in office, on scrapping student tuition fees so people, like yourself, Grace don't have to take out a student loan.

To those that have, especially the insensitive, more shall be given?
PS We import raw materials, goods and services to produce goods and services for export, Grace.

A fall in the value of the £ may make our exports cheaper, but it may also make the cost of making them more expensive.

Moreover, we tend to produce high value goods.
Now, Grace, I'm not convinced that a fall in the price of a machine tool of, say 5%, is going to persuade a German based business to buy two such items rather than the one they felt the business needed before the value of the pound depreciated against the Euro.
Jaguar, Castle Bromwich (in West Midlands, Grace, not it's Grim Oop North Land) sells most of its cars into #EU27

Will they sell more luxury cars if their price falls tad?

Bearing in mind they import parts (& want the UK, preferably, to stay in Single Market & Customs Union).
And all Landrover production is about to move to Slovakia to a plant big enough to take JLR's Castle Bromwich plant, too.

So, in future, your chums may well pay more for their shooting brakes and possibly even Jags, if the £ falls further against the Euro & dollar.

And then ...
... there's the rising unemployment, amongst those employed in manufacturing and, of course, the benefits freeze.

To add insult to injury as unemployment rises, #Labour under #Corbyn tacitly supports #Conservatives leaving weekly core rate of JSA, for those 25 plus, at £73.10.
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