"STICK to the plan because the plan is working”.

So says our mega-rich Prime Minister as he heralds a drop in inflation to 7%. Is it though?

Twitter/X’s fact-checking “community notes” service quickly corrected Sunak’s implication that inflation rates coming down means the cost of living is reducing citing the Institute for Government. It doesn’t.

It just means things are becoming more expensive a little more slowly.

If you are already struggling financially, it’s like getting hit in the face once a week rather than twice.

There are of course lies, damned lies, and statistics. And there are so many statistics that mathematical sophistry abounds. But let’s look at things in the round over the last two years.

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We’ve had high inflation for more than a year now which means that over the last 24 months prices have gone up by almost 20% – that’s an average figure based on the consumer price index which measures the cost of everything across the economy.

The problem is that most people’s spending is not average. The less money you have the greater proportion of it you will have to spend on basics like housing costs, energy and food.

Everyone knows energy prices have gone through the roof over the last two years. So much so that when the RAC gives the pump price for petrol this August at £1.50 a litre, we are relieved it is so much better than last year’s peak of nearly two quid.

We forget though that as recently as the start of 2021 it was only £1.15 a litre.

But the real killer is the cost of food.

In 2021, about 14.4% of average household spending was on food. But for the poorest fifth of families that figure rises to 18.3%. And for those on fixed minimum incomes the figure is higher still. So, for poorer families the real cost of living increase is way more than the headline rate of inflation.

But, of course, we don’t need statistics to tell us that food prices have soared in recent years. A pack of butter cost £1.50 two years ago. Hard to get it for £2.50 now. A small cauliflower in my local Lidl yesterday was 95p – I remember buying them last year for 60p.

And although averages are masked by many people being on fixed-term deals, the costs of new mortgages have also rocketed, leaving many households living in accommodation they can no longer afford.

My point is that for those who were already finding it difficult to cover their mortgage and put food on the table, the financial pressure has increased by a lot more than the average of around 20% for overall inflation.

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Rising prices wouldn’t necessarily be a problem if incomes were rising at the same rate. But they aren’t. Nowhere near it. Figures out last week show that on average private sector wages have increased by 8.2% in the last year. However, this time last year the figure was 5.2%, making an overall rise in the last 24 months more like 14%.

Someone facing average inflation rises in their household costs and getting an average wage increase is therefore going to be considerably worse off compared to two years ago. And again, as the cost of living squeeze bites, it is hitting the poorest the hardest.

The UK already had a very high level of income inequality compared to other developed countries, and the recent cost of living crisis has just made a bad situation worse.

Last year, net incomes for the poorest 14 million people fell by 7.5% to £13,214. At the same time incomes for the richest fifth went up 7.8% to £83,687. The differences in gross income – before taxes and benefits – are even more striking with the income of the richest more than 12 times that of the poorest.

Admittedly, there are factors at work beyond the Government’s control. But the UK Government does have control over minimum wages levels, taxes, benefits and public sector pay.

The combined effect of Tory policies in these areas (and indeed in many others) is to turbocharge a pre-existing structural economic inequality which has been worsening over the 13 years they have been in power.

Wealth is even more unequally divided than income in the UK.

In 2020, the Office for National Statistics calculated that the richest 10% of households hold 43% of all wealth. The poorest 50%, by contrast, own just 9%. By 2023, the richest 50 families in the UK held more wealth than half of the UK population, comprising 33.5m people.

So, let’s not pretend that we’re all in this together. There’s a price to pay for Brexit, for Covid, for the war in Ukraine, for the climate crisis. It is a price that is being paid by the poor.

The human effect of poverty is catastrophic. Millions of our fellow citizens are being ground down daily. Their physical and mental health deteriorates. Dealing with that will distract the health service from other priorities and we all suffer as a result. So many lives unfulfilled. So many destroyed.

Meanwhile the richest are enjoying a roaring 20s as sales of luxury goods rise. Imports of Swiss watches were up by 31% last year. Burberry’s sales were up 11%, Kering (Gucci and Balenciaga) 14% and LVMH (Louis Vuitton, Dior and Moët) 28%.

This is broken Britain. Unequal. Unfair. And getting worse. This situation has been created by the Tories. But saddest of all it seems Labour would be content to leave it pretty much as it is, refusing to consider any serious supply side intervention in the economy.

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Instead, they are pinning all their hopes on “growth” which they seem to believe will happen just because they might hold office.

In Scotland, we have a devolved government with the ambition to tackle inequality and eradicate child poverty, but very few weapons in their armoury. All credit to the Scottish Government for what they have achieved with the powers they do have. The rent cap has kept private sector rent increases to no more than 6%.

The Scottish Child Payment has boosted household incomes for poorer families. Settling public sector wage claims with nearer to inflation increases has narrowed the cost of living gap here compared to south of the Border.

It’s something. It’s important. But it’s not enough.

To truly tackle inequality, a Scottish government needs control over all taxes and benefits. It needs the authority to regulate energy supply and cap profits. It needs power over minimum wage rates and price controls. And it needs new powers to redistribute accrued wealth and put it to public use.

All these actions will be available to our government when Scotland becomes an independent state.

But at the coming election we should also argue that a new UK Government immediately transfers these powers to the existing Scottish Parliament so that we can get on with the job now while the country reconsiders its political autonomy in the future.

That would allow us to go faster and further with economic reforms. And demonstrating those powers in action and the change they can make to people’s lives would be best recruiting sergeant for independence I can think of.