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2011 is the year that will make or break the UK. The coalition government will carry on punishing the UK population with their “slash and burn” tactics in a bid to extract every penny possible from a shrinking workforce. The coalition is hoping for a recovery fed by consumer spending, but everything they have done so far is reducing the possibility of this happening.
The motorist is but one of the sections of the community to be hit, with the increase in fuel duty and the increase in VAT, the government have added another 2.5 pence to a litre of fuel. As expected the filling stations have increased the cost further, with prices rising by around 5 pence a litre. Prices in Scotland's remote areas will be even higher, with fuel now costing £1.45 a litre [£6-60] or more in some parts.
Some private motorist can of course ditch the car and go by train, this will relieve the amount of fuel pollution, but the cost of train fares has risen even more.
Shop prices aren’t expected to go up much, most of the supermarkets and the big multiples, have been steadily increasing prices to accommodate the new VAT increases. The small shops already on tight margins will have to increase some prices; indications are that there is little scope left for laying off staff, or reducing wages.
In order to maintain or increase margins, companies are reducing the content where possible to cover the price increases.
Three companies we monitor have found different ways to reduce manufacturing costs. One company decided two days before they finished for Christmas, that they would cancel the official Bank Holiday on Monday the 3rd January 2011, and all staff had to work. In return they agreed to pay the staff for the 1 day the government declared as an official holiday for the Royal wedding. Another company told their staff again two days before Christmas, that the company would close down for a holiday between Boxing Day and the New Year. If the staff had any holiday entitlement they could be paid, those who had used their holiday entitlement had to have the extra days off without pay. These are two relatively large companies, are obviously very caring, and conscience of maintaining staff moral and staff loyalty. The last firm had a better way of maintaining staff loyalty and moral. A small firm, the owner called the staff together 1 hour before they were due to break up for the Christmas break, and announced that he was considering making them all redundant, because he had made enough money, to retire.
Of course this is nothing compared to the 87,000 plus council workers who received a letter just before Christmas telling them their jobs were at risk About half the local authorities have yet to respond to the to the funding cuts.
The Local Government Association has predicted coalition spending cuts will lead to the loss of 140,000 council jobs in England and Wales in the next year. Local authority leaders originally forecast 100,000 posts would go as a result of October's Spending Review, but revised up its estimate a month later after studying the impact of planned town hall budget cuts. However, Communities Secretary Eric Pickles questioned how the association arrived at its numbers."I have seen better figures put together on the back of a fag packet," he said.



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Vic Farron RFT Express.
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