Real wages have been squeezed in recent years but, as the IFS have made clear, “this is a as a direct but delayed result of the 2008 recession”.
This government’s long term economic plan is working. Recent data from the ONS has shown that people working full time in the same job for more than a year have seen their pay rise by an average of 4.1%, more than twice the rate of inflation. The OBR forecasts that average earnings will grow in real terms in every year of their forecast.
Since the start of this Parliament this government has taken decisive action to support living standards. We have got 1.7m more people into work, boosting household incomes. As set out at the Autumn Statement, the personal allowance will now increase to £10,600 in April 2015, providing an income tax cut to the typical basic rate tax payer of £825 in cash terms. This government has also frozen fuel duty and Council Tax, provided additional support for childcare and cut energy bills, further supporting families budgets.