People Squeezed by Inflation Rise and Government Cuts
10 Feb 2011
Congress said today (Feb 10) that the latest rise in inflation was part of "a very worrying upward trend that clearly shows the Government policy of driving down wages is wrong and is imposing real hardship on many people."
According to Congress Economic Advisor Paul Sweeney: "People are now being squeezed between the pincers of falling take home pay and remorseless price rises. Yet Government continues to attack peoples' incomes. They used to justify this with the claim that prices were falling sharply. But this is the sixth straight month of rising prices.
"The mortgage interest increases, a rise in public transport prices, the jump in commodity prices - particularly oil and food- are all contributing to this remorseless rise in prices.
"And the Government's contribution to this has been cuts in welfare and rising taxes. The heartless cut in the Minimum Wage must be reversed immediately by a new Government."
"Action must be taken in reducing 'administrative prices' that is, prices which Government has control over, like VAT and other charges. The expected rise in interest rates by the ECB later this year will further exacerbate this trend. The fall in disposable Irish incomes will depress domestic demand and the economic recovery further," Mr Sweeney said.