GMB Call On Governor Of Bank Of England To Hold Interest Rates Low Until Pay Makes Up Ground Lost In Downturn
GDP per head is still 5.7% below 2007 levels and this is the root cause of average earnings being down 13.8% in real terms since then says GMB
GMB commented in advance of Governor of Bank of England speaking at the TUC Congress in Liverpool on Tuesday 10th September.
Paul Kenny GMB General Secretary said "We want Mark Carney to say that he will hold interest rates low until pay makes up some of the ground lost in the six years from the start of the downturn.
The Bank has to recognize that there is some way to go before GDP per head recovers to pre- recession levels. Much of the growth since is due to demographic factors. The increase in population means GDP per head is still 5.7% below 2007 levels. This is the root cause of average earnings being down 13.8% in real terms since then.
Interest rates can not rise while the recovery is patchy. There are large swathes of the country and a great number of workers that have seen little or no benefit from this recovery. Low pay has to be topped by tax credits adding to the deficit.
The Bank must also recognise that financial controls are not enough for the housing market. Lower income families are shut out of the housing market. They need houses for rent. Using expensive private sector landlords funded by taxpayers to provide these houses for rent needs to be phased out. That will bring down public spending.
The country needs a target for new build homes of 250,000 per year plus a minimum of 30,000 empty homes brought back into use. At least 80,000 of the target need to be in the social housing sector. This cannot be done without a major programme of council house building.
The Bank is at the heart of the City. The TUC would like to hear Mark Carney say that he plans to advise Government how to stop City linked tax evasion, in particular via the Crown tax havens, that way the deficit would disappear overnight.”
Contact Kamaljeet Jandu 07956 237178 or GMB press office 07974 251 823 or 07921 289880