Nicola sturgeon has been accused of “failing to grasp” an “epidemic of working poverty” set to engulf Scotland within months.
The Bank of England has warned the economy will slump into recession later this year, crippling thousands with a devastating combination of eye-watering energy bills, mortgage rate hikes and inflation of 13 per cent. The Sunday Mail can reveal one pensioner living in a semi-detached family home in Edinburgh has seen her annual gas and electricity charges double to a staggering £6087.
Figures from the Office for National Statistics reveal 25 per cent of people lived in fear of not being able to make mortgage payments even before Friday’s interest rate hike. Meanwhile 41 per cent admitted cutting back on food and 39 per cent said they were struggling with fuel costs.
Despite the financial pressure faced by millions, profits and executive pay at Britain’s biggest energy companies have continued to soar. Trade union GMB Scotland’s Keir Greenaway has warned of mass strikes and poverty unless political leaders end the culture of “obscene inequality”.
He said: “Scotland is facing an epidemic of working poverty. More and more of our members in frontline services are affected by debt, fuel poverty, and hunger – readers of the Sunday Mail will have read their testimonies in recent months – and this will only get worse with double-digit inflation and eye-watering energy bills as winter bites.
“Let’s be clear, our political leaders can’t feign ignorance or pass the buck over the state we are in, many of the workers we depend upon have been chronically undervalued and increasingly exploited for years while the riches and rewards have been swallowed-up by chief executives and financiers. The recent industrial actions, and prospect of more strikes in the weeks and months to come, are a direct and deliberate response from workers to their employers and politicians that this obscene inequality cannot continue.
“For GMB and the extraordinary people that we represent, many of them applauded on the doorsteps two years ago by the same politicians now threatening further and significant cuts to real terms pay and the services they deliver, we will make no apologies for confronting this.
“We fully understand this cost-of-living crisis will rapidly turn into a catastrophe for tens of thousands of key workers and their families in services like local government unless significantly improved pay offers are tabled for their consultation. What’s disturbing is that Scotland’s political leaders don’t seem to have grasped this themselves.”
It emerged last week BP will hand billions to shareholders after tripling profits to nearly £7billion in the second quarter of the year, helping CEO Richard Looney earn £4.5million. Shell also reported second quarter profits of £9billion and British Gas owner Centrica has reinstated dividends to shareholders after making £1.34billion.
Despite the cash bonanza for energy giants, one street worker who runs a night time soup kitchen in Glasgow has told of rising demand from a new population of working poor. Colin MacInnes, of Homeless Project Scotland, said: “We have people queuing every night for food from all walks of life.
“To them the recession is already here. It is the homeless, the vulnerable, the working class, it is everybody. We are already seeing the impact of the recession before it has even officially started.”
Colin said the charity is desperate for more donations so they can meet the rising cost of food. He added: “We are stretched to our limits. Our cost for chicken and mince for each night is £290. We would like to see the Scottish Government and councils to do more to help organisations like ourselves.”
Last week, the Sunday Mail told how councils across Scotland were considering opening public buildings over winter for people who can’t afford to heat their homes. Former Scottish Government minister Des McNulty, now deputy director of the influential Policy Scotland think tank, warned of hardship for thousands while firms struggle to survive.
He said: “Both have significant concerns about the future. Firms who are big users of energy will feel the bite first.
“It will be a challenge to see if they can absorb price increases or if they have to pass them on to consumers. We don’t have the same scale of manufacturing as we did in the seventies and eighties, so we won’t see the same level of job losses. However, the effect on smaller firms could be quite considerable.”
The ex-Labour MSP and deputy social justice minister said people who have mortgages – and who are not on fixed deals – could be tipped into poverty by interest rate increases.
He added: “Poverty is a statistical measure how much people have to live on and how much they earn. The things that are going up fastest, which are energy and food cost, are the things that are least avoidable and the most difficult for people on low incomes to pay for.”
Thousands of council workers are threatening to strike over a two per cent pay rise offer. The Scottish Government has warned that
allocating an extra £140million to settle the dispute will mean sacrificing other spending plans.
Deputy First Minister John Swinney announced the new funding on Friday after talks with local authorities broke down. He said the government was keen to help but warned that with Scotland’s budget fully allocated, very difficult decisions would have to be made to find the money.
Swinney added: “Without the ability to borrow or change tax policy, this will have a significant and ongoing impact upon our fixed budget that ministers are taking steps to address.”
A spokesman for the Scottish Government added: “We have allocated almost £3billion in this financial year to helping mitigate the increased cost of living. This includes raising the Scottish Child Payment to £25 per child per week and extending it to under 16s by the end of 2022, as well as providing access to free childcare, baby boxes, prescriptions, travel and social security payments not available anywhere else in the UK.
“Earlier this month, Deputy First Minister John Swinney wrote to the UK Government calling for further funding to be provided for public sector pay deals.”
Don't miss the latest news from around Scotland and beyond - Sign up to our daily newsletter here.
