Ed’s BBC News interview on the Bank of England quarterly inflation report

Norman Smith: Does it mark the beginning of the end for the cost of living crisis?

Ed Balls: Well, I hope so, but I have got to say, wages rising by 1.3% hailed as ‘remarkable’ by a Conservative minister, that just shows how out of touch Iain Duncan Smith and George Osborne are. The average working person in our country is £1600 a year worse off. Month after month for years, prices have been going up faster than wages, we’ve now had one month where wages went up by 0.1% more than prices, because prices are really low at 1.2%, as the Governor of the Bank of England says. ‘The end of the cost of living crisis’, ‘a bonanza for working people’ – who are the Conservatives trying to fool? What we’ve got to do is get the economy growing strongly and then translate that into a recovery which works for working people. Labour’s got a plan to do that, all I see from the Conservatives is complacency.

NS: And yet we heard from the Governor of the Bank of England that he expected real pay growth to accelerate to 2% so it’s not just one month it is the start of a gradual climb back in pay?

EB: I hope so. At the beginning of this year many commentators, the CBI, the Bank of England were expecting pay to accelerate this year and it’s not happened so far. That’s why people are even more worse off than they were before. There is a lot of catching up to do and I want to see wages rising faster than prices for the next few years. I think the worrying thing from the Governor of the Bank of England’s report today is that he sees our economy slowing down next year and the year after, partly because of the Eurozone but let’s also be honest because this recovery has not worked in a balanced way. We’ve not seen the exports, the business investment that we’ve needed over the last few years. Are we really going to have an economy which works for working people? I think we need action on young people’s jobs, to raise the minimum wage, to make sure tax credits and help on childcare make work pay, a business investment bank to help small businesses – that is Labour’s plan to get living standards rising. What you see from the Conservatives is they are crossing their fingers and hoping for the best and that’s not good enough.

NS: Let me also ask you about a poll out in today’s Evening Standard, which gives the Conservatives a three point lead, puts the Conservatives on 32%, Labour on 29%?

EB: These polls have been bouncing about, day to day, week to week, month to month…

NS: You’re three points behind now, three points behind?

EB: And we’ve had polls like that in the last few months and we’ve had polls…

NS: You haven’t – three points behind?

EB: We have, and we’ve had polls which have put Labour three and four points ahead. The only poll which matters is the General Election day. Of course that’s a cliché, but it’s true. And the question people will ask in the next few months is ‘who has got the long term plan to deliver rising living standards?’. We say reverse the top rate tax cut for the richest people over £150,000 and get the deficit down in a fairer way, repeat the bank bonus tax to get young people back to work, more apprenticeships, a business investment bank. The Tories just say, ‘trust us, we’ll deliver’; for four years they have failed on living standards, they’ve not even got the deficit down, it’s going up again. Do you want to carry on with more of George Osborne? I think most people will be pretty fearful of that.

NS: This poll also suggests just 13% – one three percent, see Ed Miliband as a credible Prime Minister. He has become a liability for your party hasn’t he?

EB: Our party is determined – from Ed Miliband, right down, throughout all our shadow cabinet and MPs – to get out there and say we’ll have reform in Europe but we won’t play fast and loose with jobs and investment like David Cameron, we’ll have tough and fair immigration controls but we won’t walk away from international markets like UKIP and the Tories, that we will have action on banking reform but also a bank bonus tax. We’ve got the policies. I think with Ed Miliband’s leadership we can persuade the British people in the coming months that we’ve got the plan to make our economy strong and secure for the future. That’s what we’ve got to do and that’s what we’ll do every day until polling day.

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Posted November 12th, 2014 by Ed's team