According to the report carried out by the London-based research centre Resolution Foundation, 2011 will be a bleak year for the British middle class. Indeed, owing to the estimated cuts to public services, with the reduction of welfare benefits and the VAT increase, those households that live on the margins of the private system and are too “wealthy” to receive state benefits will get through anxious months because of the concern about their standard of life. Numerous families will have to reckon with price and tax increases and reduction of many benefits. What is more surprising than the data provided by the research centre is that the most exposed category to the Cameron government’s measures is middle class, which traditionally is the electorate of the Conservative party. Even Mrs. Thatcher did not dare to hit middle class so severely.
Taking account of the differences between households with and without children, 11 million Britons who earn between £26.000 and £50.000 per year will undergo a net loss of their purchasing power equal to £800. This picture becomes even worse if we consider that only one third of those families contribute to their pensions and a large part of them has to repay mortgage loans. In addition, due to a likely increase of real interest rates, many youngsters will have to face more difficulties to invest their money in order to buy a decent apartment.
The understandable need of Her Majesty’s Government to reduce the budget deficit puts a strain on the British middle class. According to some studies, one-fifth of the Queen’s subjects think they belong to this category. But, as it emerges from the report, many people will encounter more and more obstacles in maintaining a congenial lifestyle. The government’s measures make fear for the worst.
Ultimately, middle class will be overcome by countless pressures and will be forced to reduce the percentage of salary to put away as savings. Both the domestic demand and investments will proportionally drop off, causing a probable economic contraction. According to the report, the state should contain public expenditure without abandoning families.
If urgent measures to mitigate the real loss of wealth will not be taken, future will be ominous for many people. It is not difficult to suppose that this appreciable impoverishment will cause the growth of frustration of those who are too wealthy to get welfare benefits but too poor to interact in the private market.
(Translation: Francesca Cannino)
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