February 27, 2024
Liz Truss takes office this Tuesday as UK Prime Minister amid the country's inflation crisis |  Globalism

Liz Truss takes office this Tuesday as UK Prime Minister amid the country’s inflation crisis | Globalism

The new Prime Minister of the United Kingdom, Les Trusstakes office this Tuesday (the fifth) at a time when the British They must tighten their belts in response to hyperinflation and rising energy costs.

“We’ve had a tremendous historical impact on the cost of living and on income,” James Smith, director of research at the Resolution Foundation, says in an interview with AFP.

The new prime minister will have To focus on the current crisis from day one‘, he adds.

On Tuesday (6), contrary to tradition, the new Prime Minister will not be appointed at Buckingham Palace in London. It will take place at Balmoral Castle in Scotland, where Queen Elizabeth II is spending the summer.

The 96-year-old has had to cut back on her public appearances this year due to mobility issues and will not travel to London.

Liz Truss is the new Prime Minister of the United Kingdom

Liz Truss is the new Prime Minister of the United Kingdom

Boris Johnson, the current prime minister, is expected to make a statement outside Downing Street in London on Tuesday morning before traveling to Scotland to present his resignation to the Queen, expected around noon (7am ET from Brasilia).

Liz, the winner of the election, will meet the Queen and be formally invited to form a government.

Countless industries, from garbage collectors to lawyers, have spent the summer calling for strikes to demand higher salaries in the face of inflation.

The closures were widely supported, but angered some Britons who faced canceled trains and empty supermarkets.

With winter approaching, many homes are already fearing a massive rise in energy prices.

“Almost nothing seems to be working in the UK,” wrote The Economist. “This could get worse,” he added.

The inflation rate was 10.1% annually in July, its highest level in 40 years, and is expected to exceed 13% by the end of the year.

Marcelo Lenz: Liz Truss' biggest challenge is the energy crisis

Marcelo Lenz: Liz Truss’ biggest challenge is the energy crisis

This has caused the biggest drop in purchasing power in two decades, with people on relatively low incomes paying more for products like staple foods.

Also, in October, the power regulator will allow suppliers to charge up to 80% more than consumers, to reflect rising global wholesale prices.

The UK has some of the oldest and least energy efficient homes in Europe, as well as a slow spread of green technologies.

The most disadvantaged families often use prepaid energy meters, which disconnect the supply when the balance reaches zero and prevent energy costs from spreading throughout the year, making it impossible for many families to heat their homes.

“I think we will see real suffering and even misery” this winter, Smith warns.

Resolution has proposed a 30% reduced “social tariff” for families with lower middle incomes.

Europe is also experiencing a major energy shock and the US is experiencing rising inflation.

In the UK, “we have in some ways the worst of both worlds,” says Smith.

York University has calculated that two-thirds of British households will be in “energy poverty” in January, meaning that more than 10% of their net income will be paid into energy.

Experts warn of dire consequences.

“Within weeks, many parents will be faced with impossible choices between eating or keeping warm, but we still don’t have a government plan that recognizes the urgency or scale of this crisis,” says Dan Baskins of Save the Children. .

The doubling of strikes over the summer set the conservative media into a parallel with the 1970s, when strikes and protests spread across the country.

However, the National Institute for Economic and Social Research notes that “the 2022 attackers (…) operate from a fragile position.”

Currently, unions represent only 23% of workers.

Due to Brexit, COVID-19 and other factors, the labor market is experiencing a labor shortage, with fewer workers than jobs.

This particularly affects sectors such as airports, which have laid off specialized staff during the pandemic and are now unable to hire new staff, causing long queues and the cancellation of many flights.