Can someone explain to me why/how the Labour government has directly made them worse off in the last 15 months?

[MotherofAdults]

Can someone explain to me why/how the Labour government has directly made them worse off in the last 15 months? I see this claim a lot on these pages, but I don't understand why. Sorry if I sound stupid, I am just trying to get clear.

I totally understand that the cost of living keeps going up - that inflation keeps rising (3.5-3.8%?) and that mortgage interest remains relatively high, but I don't understand why or how this is the fault of the current government? What have/haven't they done? Are people angry that they haven't curbed inflation? What should they be doing?

If we could avoid mentioning the things that didn't actually happen (eg the Winter Fuel Allowence cuts) and speculation about what the next budget will do (doubling of council tax, rise in minimum wage etc), that would be really helpful. I am looking for actual changes made by this that have directly affected your financial situation since Labour got it.

I thought the ECHR were going to ride in and save them ?. There was a thread a day about how it was going to be thrown out by the supreme court and ... gosh there was so much that was going to happen.

Their Net Zero policies means we have the highest energy costs of pretty much any country. And we have not reduced CO2 production as it is now just produced by foreign companies, who benefit at the expense of UK companies, plus extra as the produce has to be transported round the globe.

I'm an employer. We are holding off hiring and are more likely to use freelancers than hire anyone permanent because of the new bill. Our NI bill increased substantially last year.

We have a second property and we're not letting it out because we want to be able to sell it whenever we want and not struggle to get a tenant out following the renters reform bill.

We were going to sell our main house but if they put CGT on it we won't, we'll stay for ever. And we'll reluctantly have to pay more council tax if they double that which will mean we spend less money in the economy.

Can't think of anything. My parents are convinced it has impacted their business but I run payroll and the increase i employers NI was offset by the HUGE hike in Employment Allowance.

A few years ago VAT on school fees would have affected me (dd was at a specialist school on a massive scholarship) but if I weight that up against some of the funding I have seen for state education in my area for the poorest children (such as increased state school music provision) then I'm pretty happy.

The way to get better wages for workers is to have a growing economy with plenty of jobs and thus employers have to compete with each other and pay good wages to attract good staff.

Giving higher NI to employers and raising min wage actually has the opposite effect. Employers stop hiring.

Interesting - what is the Employment Allowance? Sorry I can look this up.

They should have lowered Employers NI, not raise it, to create new jobs and increase hiring. They should have introduced a flat rate income tax, not a bracketed system. They should have removed the triple lock. They should have invsested in high street redevelopment, tourism, and housing.

Unemployment is at an all time high. Small businesses in particular are suffering, many have gone under or are making people redundant.

They should have increased penalties on benefit fraud. They should have offered financial benefits to large corporates to establish their HQ in the UK, in return for job creation and social impact programmes.

They should have focused on creating (re)education projects to prepare us for an aging population and rising international tensions - not invested in their flagship AI disaster-to-be (not even going to mention the digital identity-disaster-to-be or merging local authorities), or age verification for websites.

They should have strategic plans in action to move our workforce on to cyber security, robotics, pharma, energy, manufacturing, food supply chains, and modern social care.

Well, you asked a question and VAT on school fees has had a direct impact, so i ma not sure you can dictate people don't reference it.

And you are naiive I am sorry to say if you think that it all comes down to a luxury and a choice. That's the case for many, but not all.

Anyway- as a pp said- if they bring in all the ideas they have floated we are screwed. As we are losing so much of our income, the reality is that just if they double council tax on certain bands, combined with tax on fees AND the loss of DH's income which we already know will happen December 1st then we will be paying more tax than we earn.

Like, um literally.

Not only are Labour not sorting out fiscal drag (if in line with inflation, no-one under 80k should be in the higher rate of tax. It looks as though they are actually going to increase tax for middle-earners. Outrageous.

They’re cut funding very aggressively in my field, put up student fees, and have made it so my parents cannot sell their £900k home. We aren’t wealthy - we bought it 10 years ago for a third of that due to the condition it was in and renovated it ourselves. Now they can’t reap what they’ve sowed and they’re devastated. They’ve worked so hard and are working people

VAT on private school fees, but we sent DC to private school after Labour got in and I still voted for them knowing that was on their manifesto so whilst I don’t like it, I don’t see it or Labour negatively.

The budget does worry me though and from things we’ve heard, it does sound like we will be hit badly.

There are 25% more unemployed now than when Labour took power. Unemployment always increases under Labour as they need to keep people impoverished to maintain their voter base.

Unemployment will continue to increase as Reeves takes more money out of the economy, energy costs remain the highest in the developed world to fund Milliband's vanity projects, increase business taxes.

Add to this all the corruption (Starmer's free stuff, Raynor/Reeves housing fiddles, etc) and broken promises (smash the gangs lol, WASPI women, WFA, etc)) and it is plain to see it has been a complete s__ show.

To be fair things were bad when they took over but Labour are making things far worse even if you are in denial yourself.

But the tax threshold was set by the Conservatives. And a government cannot lower tax thresholds whilst still having to fund essential services (defence (including coastguard), healthcare, education, welfare safety net, financial security etc) in a time of inflation, because the government's costs have already gone up.
NI, I understand (know people in business) but the rest is just how the world is now - we have had major economic crises and warfare, and because of globalization matters which might not affect us now affect us to our detriment. No government on the planet is doing any better than Labour is here - and some are doing much worse with accompanying civil unrest and war to cope with.

Rachel Reeves says “we’re all” going to have to chip in. I hope “all” doesn’t in fact just mean the schmucks in the middle. But I’m not optimistic about that…

NI rise has added nothing to 1.8million smallemployers, because of offsets and allowances, and full impact is approx £60 per month per employee. You could call it an incentisation to improve productivity?
NMW is higher but the idea is people on lower incomes spend nearly all of any new money, which boosts the overall economy.
AI is a bigger threat to jobs. Tariifs also. And Brexit was a country imposing economic sanctions on itself.
Tax thresholds were a Tory policy.
The Tory NI reduction was unfunded, and Hunts last budget talked about unspecified savings of approx £20bn.

Of course governments can lower tax thresholds; they have to make choices. If they chose to give larger pay rises or not cut benefits then they have to pay for it from somewhere. But that is a choice Labour are making.

Ok that is worth pursuing - thank you - I will look at unemployment.

I am not in denial, we are and likely will be, (but as I said I don't want to speculate on the budget), significantly worse off. I initially wanted to understand what Labour have/haven't done - how much was previous government policy, how much was direct changes.

My feeling is still that they haven't solved anything and but it seems for many here attempts at redistribution of wealth have, at the moment made things worse. I wanted to understand if there was a difference between perception and real experience.

The difficulty is what is resolvable, what are the solutions and what do we value, but that is for another day, thread.

Edited for typos

As for Trump’s tariffs - Labour’s antagonistic attitude towards Trump certainly wouldn’t have helped negotiations.

"If we could avoid mentioning the things that didn't actually happen (eg the Winter Fuel Allowence cuts) "

except setting limits to who gets the Winter Fuel Allowance DID actually happen and people ARE actually less well off because of it. I accept that many the people who now don't get it may not have needed it but please don't say that it didn't happen because it did and it did have results. By saying "it didn't happen", you do sound stupid!

@MotherofAdults do you plan on responding to any of the factual posts showing how this Government has made people worse off? Many posters have tried to enlighten you, but you don't seem to be acknowledging any of them. I just wondered why..

What you are actually saying is ‘how will it make ME worse off’. You seem to be dismissing everyone else’s experience as irrelevant.

Unfortunately for you, they get to vote too.

I feel more stressed under this Government. Does that count? It is the not knowing where they are going to strike. There is talk of them breaking their manifestation pledges - increasing NI or tax or taxing pensions. People are anxious and worried. Not knowing how they will manage if this does happen. It doesn't matter whether you feel what they are planning is 'right' or not - these are people's lives and budgets. Many of them are living on the edge already.

I responded directly to you up thread?

“Of course governments can lower tax thresholds; they have to make choices. If they chose to give larger pay rises or not cut benefits then they have to pay for it from somewhere. But that is a choice Labour are making.”

If they do not cut benefits and only do tax rises, the financial markets will punish them severely and the cost of sovereign borrowing will increase even more, swallowing up all tax rises. They have no choice but to do both. Let’s see how foolish they really are. The money they end up spending has to be “investment” and the markets need to believe it. If they do not, we are truly screwed.

I work in a non technical recruitment field. Business rates, employer NI and minimum wage costs have affected businesses, which affects us. There have redundancies, new roles have been shelved and many people are have been given extra work as companies try to cut costs. Firms can't always absorb or fully pass those costs on which is feeding into redundancies. We have just let a junior member of staff go because of the downturn.

The effects don't have to be immediate for Labour's policies to be a problem.

The economy is being damaged and it will get worse not better.