2014 – The year of the cost of living?

It’s official. We’re going to be reading and hearing about the ‘cost of living’ well into 2014.

Granted, it’s not an exactly earth shattering revelation, but the importance of everyday living costs and pay to the political narrative has been underlined this week by Ed Miliband and, perhaps more surprisingly, the CBI in their ‘New Year’s messages’ as the political parties move into the final laps of the track before the General Election in 2015. CBI Director-General John Cridland has been particularly blunt in his criticism of British businesses for keeping too many workers stuck in minimum wage jobs. Cridland has instead sought to encourage businesses to pass on new-found prosperity, generated from the now blossoming green shoots of economic recovery, to their employees. Mr Miliband for his part has highlighted the need for changes to childcare provision and for action over payday lending.

There is of course a degree of expediency to both statements. As many commentators have noted, Mr Miliband needs to demonstrate that his cost of living crusade is more than a series of populist announcements (such as a price freeze on energy bills) and is in fact a considered objective around which Labour can frame a series of policies. It is also a reflection of the fact that cost of living is an economic battleground on which Labour can challenge the Coalition after the recent and numerous indicators of the economy’s growth. The CBI’s message reflects the need to pass on the benefits of economic growth to workers who can then boost consumer spending.

What both messages have in common is that they underline the importance of the cost of living as an election issue come 2015, by which point the electorate will expect to not only see abstract economic growth but experience its tangible benefits. The challenge for Labour will be to reconcile improving the cost of living situation with the public finances in order to avoid the charge that the Party is advocating living off the country’s credit card. Those organisations seeking to engage not only with Labour, but also the Coalition parties, particularly on the subject of public services will be best served by coming to the table with clear and considered ways as to how this balance can be struck.

Chris Rogers