The Spending Review was a political device that the chancellor clearly hoped would get him through to the end of this parliament. But if the spin doesn’t match the realities of life, I don’t think the public will buy it.
A big risk for both governing parties is that high increases in the cost of living define the next election. The Liberal Democrats cling to their £10k personal tax allowance as the policy that will get them through the general election in 2015, and the dry-run coming in next year’s local elections. 10k’s a natty round number that’s easy to remember, and I would be the first to admit that straight forward practical solutions that the public can understand are important in politics. But the problem for both the Lib Dems and the Tories is that income (and the bottom line of your pay slip) is only one side of the living standards coin.
At the height of the global financial crisis in 2008, each month from July to December saw annual food prices increase by over ten per cent against the year before.
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