Gold as an investment

Queen’s Speech offers little in battle to curb cost of living crisis

Sep 30, 2022

The grand, ceremonial affair that is the state opening of parliament, with its pomp, opulence and demonstration of power and influence, has never seemed so distant from the lives of ordinary people.

The hallowed halls of the Palace of Westminster, creaking with ponderous processionals and draped in acres of red velvet and gold brocade are a million miles from the increasingly frenetic and fearful battles millions of us now fight on a daily basis just to keep our heads above water.

It would be a mistake to dismiss yesterday’s ceremony as merely an isolated, archaic point of tradition, though.

The speech delivered by the Prince of Wales – a brief gallop through the 38 different legislative bills to be considered by the houses of Commons and Lords in this next session of parliament – was written by the government.

It was a forensically honed mood-setter for debates whose outcomes will influence every aspect of our lives.

It was never going to be a Budget. Though the now suffocating cost of living crisis was at least mentioned in the very first sentence, there were no specifics to ease the fears gripping households across the United Kingdom.

But nor, opposition politicians complained, was any urgency expressed. There were no revelations on emergency Budgets for example (at least not yet), only an attempt to manage our expectations over what little the government can do to curb inflation – expected to reach at least 10 per cent this year and to remain high for some time.

There is no doubt the economic straits we now find ourselves in – both individually and as a nation – are founded in the unprecedented, broader, back-to-back circumstances of the pandemic and the invasion of Ukraine.

But the government’s decisive response to the first has created space to ask why more action is not being taken to relieve the impact of the second. Indeed, as MPs settle down to consider where on earth we go from here, calls for windfall taxes, VAT cuts and sustainable (in all senses) action on energy bills are growing.

So what do the events of yesterday tell us, what should we expect and, above all, is any of it going to help get us out of this crippling crisis?

Most of the bills mentioned feel frustratingly like housekeeping, as if our leaders are sweeping around the edges of a personal financial crisis in an attempt to help keep it all slightly more contained, if not actually clear it up.

But two pieces of legislation – the Financial Services Bill and the Economic Crime Bill – probably shouldn’t be dismissed as personally irrelevant as we seek more immediate reassurances on everyday strains.

“The Financial Services Bill provides the opportunity to tailor the UK’s regulatory framework and so create a more competitive financial services sector post-Brexit, supporting jobs and investment across the country,” says David Postings, chief executive of banking trade association UK Finance.

“The Economic Crime Bill will be critical in helping to address money laundering and the growth in fraud and scams, which are now the most prevalent type of crime in the UK. This bill should focus on measures that prevent fraud happening in the first place and provide greater enforcement powers to tackle those who commit economic crime.”

That’s important given the growing risk of losing money we can ill afford due to scams. Only yesterday, the UK cybersecurity agency revealed it took down a record number of online scams in 2021 – four times as many as it stopped in 2020.

Individual banks have reported similarly massive increases in other kinds of fraud too, such as TSB’s recent revelation that impersonation fraud cases are up 300 per cent.

And while there are measures in place to restore money lost by victims of fraud, thousands continue to fall through the gaps for reasons ranging from personal embarrassment to institutional ambivalence.

Crucially, the Financial Services Bill will allow the financial regulator to force banks to reimburse victims of authorised push payment fraud – which occurs when scammers convince victims to authorise payments by deception.

The bill will also attempt to protect access to cash, used particularly by vulnerable and marginalised individuals.

At the same time, Lisa Laybourn, head of technical policy and regulation for financial wellbeing organisation The Investing and Saving Alliance (Tisa) points to the importance of the Online Safety Bill as a crucial part of the battle against fraud, too.

“We are spending more and more time online. Simultaneously, the burgeoning online advertising ecosystem means that we need a regulatory framework that is both fit for purpose and agile enough to keep pace with a rapidly changing environment,” she says.

“It is significant that consumer confidence in scam prevention measures has been raised within the Queen’s Speech. If it hadn’t, that could jeopardise the uptake of vital new digital tools such as the pension dashboard.”

But, she adds: “Legislation needs to be flexible enough to easily adapt to evolving and sophisticated scammer activity.”

Others reacted with relief to the inclusion of Renters Reform Bill, while the failure to include plans to tackle retirement undersaving worried those in the pensions industry.

But really, the bill we wanted to hear about was the one that barely got a look in – energy bills.

With the autumn set to ramp up the affordability crisis to the tune of at least £600 in energy bills alone (before we go anywhere near the impact of rampant inflation on household costs) there was nothing on offer for struggling households.

“There was a brief mention that the government would prioritise helping to ease the cost of living for families, but then no actual bills announced outlining how,” says Sarah Coles, senior personal finance analyst for Hargreaves Lansdown. “This is likely to fuel ongoing rumours of a potential emergency Budget.”

The only energy bill that got a mention was the government’s plan for the transition to green energy which, along with plans to boost heat pump adoption, for example, is likely to cover the future of the energy price cap beyond next year.

The reality, though, is that next year is a very long way away for households who don’t know how they’re going to pay their next bill, let alone the millions wincing at the thought of turning the heating back on in the autumn, just in time for that next hike.

Somewhat alarmingly, much of the Energy Bill debate so far has focused not on curbing costs, but on finding ways to increase bills more steadily rather than in big jumps.

The UK’s millions of already tangibly struggling households need far more support out here in the real world than that, and fast.

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