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The government lacks a comprehensive anti-poverty strategy and risks neglecting large swaths of the population who are in dire need, such as young adults, the working poor and the 6 million under-employed, while its policies instead focus on children and pensioners, according to the Joseph Rowntree Foundation.

In a report, the foundation argues that the coalition’s anti-poverty plan is repeating the same mistakes as Labour on poverty reduction, which it admits saw a reduction in child poverty by around one-seventh, but says did not tackle many other entrenched problems.

The coalition is ignoring the high level of poverty among young adults, almost a third of whom are in poverty, the foundation says. Ministers have also not focused on working-age adults without dependent children; the number in poverty has risen by 1 million in the last decade, it says. During the same period, the number of pensioners in poverty fell by 1 million.

The working poor are also a matter of pressing concern, the foundation says. Given the commitment to reduce “in-work child poverty”, it says it is not enough to limit debate to the “traditional discussion” that raising the minimum wage, now at £6.08 an hour, would discourage job creation.

The foundation says that under-employment has risen by 50% since 2004, to 6 million people, the highest number since 1993.

There is no plan, says the report, to address problems associated with badly paid, insecure and “dead-end” jobs. Without solving these problems, poverty can never properly be tackled – more than half of all children in poverty are living with a parent who already does paid work, it says.

Tom MacInnes, coauthor of the report, said: “A conservative estimate is that the country lacks at least 4m paid jobs. In this situation, reforms aimed at improving incentives to enter work will increase the number scrambling for vacancies while doing next to nothing to reduce poverty.”

The foundation also questions the government’s universal credit policy, which aims to make work a better-paid alternative for those on benefits.

At present people in work and receiving tax credits face a tax rate of 73% on extra earnings, worse than under Labour, who had set the rate at 69%. However, when universal credit comes in, this rate will rise to 76%.

The report, entitled Monitoring Poverty and Social Exclusion 2011, challenges the government’s philosophy of using the social security system to incentivise work and to get the unemployed to take up employment.

The foundation says that for the unemployed, “welfare reform’s role is limited. In particular, it cannot be a substitute for economic policy: if the work is not there, increased incentives can do little.”

There is also a rebuke to the government over the use of statistics to paint a picture of a workshy generation. “Just 1% of all workless adults belong to ‘never worked’ households without any obvious reason. It is a serious mistake to proceed as if this 1% is somehow the essence of the problem of worklessness.”

A spokesperson for the government said: “We have changed focus in order to tackle the main causes of poverty and put in place a system that supports and rewards people who do the right thing and go to work. Our wide-ranging reforms will have a dramatic impact on the poorest families, improving the life chances of children at an early age and lifting almost a million people out of poverty through the universal credit.”

Article source: http://www.guardian.co.uk/society/2011/dec/01/anti-poverty-plan-rowntree-report

Pregnant women have been urged to monitor their coffee consumption after research showed that a single cup in some high street cafes can contain more caffeine than official health advice says is wise.

The National Institute for Health and Clinical Excellence (Nice) recommends no more than 300mg of caffeine a day for pregnant women.

The Food Standards Agency, though, recommends just 200mg daily throughout pregnancy. The Royal College of Obstetricians and Gynaecologists (RCOG) backs this figure but also recommends that women should also recommends complete abstention in the first three months.

A coffee in one shop can contain six times more caffeine than those bought in others, according to researchers from Glasgow University, who analysed levels in 20 premises. They found that a single espresso in one independent cafe contained 322mg, while one from Starbucks had just 51mg, the lowest of the 20.

RCOG spokeswoman Dr Daghni Rajasingam said excess caffeine in pregnancy had been linked to an increased risk of a mother delivering a small baby or having a miscarriage. Small babies are at greater risk of developing heart problems and cardiovascular disease later in life, she added.

Pregnant women should be aware that the caffeine content of coffee varies from shop to shop, should ask how strong a coffee is before they buy it and do their best to keep their intake down to no more than 300mg a day, and only after the first trimester, said Rajasingham.

The new research is published in Food and Function, a journal produced by the Royal Society of Chemistry. Caffeine is also found in tea, chocolate and in some soft drinks and medicines.

Dr Euan Paul, executive director of the British Coffee Association, said: “Caffeine content does vary between different blends that are available. The overall advice for coffee drinkers is that 400 – 500mg of caffeine per day is safe and may confer some health benefits but it’s important that pregnant women do limit their intake to 200mg per day, from all sources. For pregnant women that are concerned, switching to decaff coffee will ensure that they are drinking less caffeine whilst still enjoying their cup of coffee”.

Article source: http://www.guardian.co.uk/society/2011/dec/01/pregnant-women-coffee-risk

As public sector workers took to the streets across the UK to protest at pension reforms, picket lines sprung up over London and workers congregated on the Victoria Embankment to support the strikes.

Trade unions and the government have traded blows over the impact of the biggest outbreak of industrial unrest in three decades, as strikes forced the closure of 62% of state schools in England and the cancellation of 6,000 hospital operations

Article source: http://www.guardian.co.uk/society/video/2011/dec/01/public-sector-strike-video

Public sector strikes ‘a damp squib’, says Cameron. Link to this video

The biggest display of industrial discontent in three decades ended in a propaganda war as unions and ministers traded blows over the impact, with more than six out of 10 schools shutting in England and 6,000 NHS operations cancelled across the UK, but Heathrow airport avoiding serious disruption.

Turnout became a key battleground after David Cameron labelled the walkouts a “damp squib” amid government estimates that only half the 2 million public sector workers expected by the TUC to strike had taken part.

The TUC’s general secretary, Brendan Barber, hailed “huge turnouts” on an “unprecedented” day for the labour movement as tens of thousands of workers from all corners of the state sector took part in protest marches around the UK.

Francis Maude, the Cabinet Office minister, acknowledged that the strikes over pension changes had disrupted services. According to the government the impact included:

• 62% of state schools in England shutting entirely and 14% partially closing.

• The cancellation of 6,000 out of 30,000 non-urgent NHS operations.

• Walkouts by 146,000 civil servants, representing more than a quarter of the civil service.

• Some 30-40 protesters from Occupy London entering the offices of the mining giant Xstrata. There were 21 arrests in and around its offices near Trafalgar Square.

The Local Government Association said 670,000 employees were not at work with only 56% of councils counted.

However, a Cabinet Office spokesman said: “The figures we have show that turnout was … significantly less than the unions predicted.”

Trade unions representing 2.6 million workers were striking over a range of pensions changes that they claim are too drastic to be acceptable. Some are structural, including linking the retirement age to the state pension age and transferring staff to new career-average schemes. One change is viewed as a naked money grab: increasing pension contributions to £2.8bn by 2015 in a move that amounts to a pay cut for employees.

Maude said the strikes were irresponsible as he disputed union claims that talks over pension reforms had ground to a halt. But one of the main union negotiators, the GMB’s Brian Hutton, said discussions on the four pension schemes – health, education, civil service and local government – had either stalled or were insubstantive. “In most of the schemes there is really nothing going on at all,” he said.

Ministers are preparing to take a more conciliatory tone with unions from Thursday as they embark on a series of meetings with union leaders, according to a senior Whitehall source. “There is a feeling that we have become too polarised over the strike and the rhetoric has been ramped up,” the source said. “Now is the time to tone it down and come together and get on with the real work in negotiations.”

Officials and ministers will meet union negotiators at a series of meetings before Christmas to discuss pensions for workers in local government, health, education and the civil service. There will be no extra money, but there will be scope for movement over the distribution of money that has been allocated by the government. “The strike has happened, we need to put it on one side and move on,” the source added.

Unions representing NHS staff accused the Department of Health of “fiddling the figures” over its claim that only 79,000 employees of hospitals, ambulance services and NHS Direct in England did not turn up for work. That was 14.5% of the workforce, much less than the 20% that the NHS had planned for, said a health department spokeswoman.

But unions claimed 400,000 NHS staff went on strike across the UK and that the total would have been even higher if some staff had not been working normally to guarantee care of emergency patients.

Amid the scramble for factual footholds, it became clear that the impact on schools was substantial. Millions of children, including Cameron’s son Elwen, missed lessons as teachers took to the picket lines and as schools closed.

A higher proportion of academies opened on Wednesday compared with the state sector as a whole: 44%. Out of the first 24 free schools, 19 were open and one was partially open. Most of the free schools are newly established, with only a single year-group.

Instead of a central march, protests were staged all over the country. In London up to 30,000 joined a TUC-organised march, accompanied by blaring music, with the Madness hit One Step Beyond proving a particular favourite.

In keeping with the Metropolitan police’s promise of total policing, large fold-out metal plates known as iron horses were erected at major junctions. Across London there were 75 arrests connected with the action, including 37 in Dalston, east London, on suspicion of breach of the peace before the rally.

In Manchester, shoppers and workers on their lunch break broke into spontaneous applause as the 20,000-strong demonstration made its way through the city centre. Among the sea of placards was one with photos of Cameron and George Osborne, with the caption “This is one Eton mess that’s not so sweet”, and another reading “Eric Pickles ate my pension” in a jibe at the communities and local government secretary.

In Birmingham, striking teacher Kate Reynolds, 33, joined the 15,000-strong vuvuzela-blowing rally with her two children, voicing her “genuine fears about my children being taught by 66-year-olds”.

Bristol’s German market was doing a roaring trade, packed with children off school, and with the Orchard Pig Cider stall putting on a special “Comrade” brew of mulled cider laced with vodka to warm strikers up.

A group of around 200, many wearing Father Christmas hats and calling themselves Santa Uncut, sought to deliver lumps of coal to so-called “naughty” institutions and companies.

In some areas ambulance services struggled after thousands of workers went on strike. In Leeds, there were reports that health workers from a hospital in Chapeltown, came off their picket line to help doctors and paramedics with a woman involved in a collision with a car.

Officers in the capital were called in to provide support for London Ambulance Service (LAS) which faced “severe pressure” as a consequence of the strikes.

Some 42% of London Ambulance Service’s staff took part in the action and NHS London strategic health authority said the service had received 30% more 999 calls than normal. The reason for the surge in calls is not yet known. Ambulance cover in Kent, Sussex and Surrey was also “significantly hampered”.

Hospitals in Merseyside, Cheshire and northern Wales were handling urgent appointments only. East Sussex Healthcare NHS trust said “no planned operations have been cancelled” but the Mid Yorkshire Hospitals NHS trust reported all planned operations cancelled, including “virtually all” outpatient clinics with a few exceptions.

The BBC’s One Show apologised after the TV presenter Jeremy Clarkson suggested on air that strikers should be “executed in front of their families”. Clarkson sparked outrage on Twitter after telling viewers that he would have striking public sector workers shot. “I would have them taken outside and executed in front of their families,” he said.

In Edinburgh an estimated 10,000 took their protest to the Scottish Parliament after a colourful rally from Edinburgh Castle, among them AE staff nurse Sharon Edgar, 37, from Rosyth, Fife, with her daughter Beam, eight.

She said she had thought “long and hard” before striking. “My little girl wants to be a nurse too. If we don’t stand up now, what kind of deal will she get?”

At Edinburgh’s Royal Infirmary, veteran trade union leader Rodney Bickerstaffe – a pivotal figure in the 1979 “winter of discontent”, when 1.5 million public sector workers went on strike – joined a picket line of nurses, lab workers and cleaners.

“These are the people who work day in, day out, they wipe noses, they wipe bottoms, they teach unruly kids, work with dustbins and sewage works,” he said of the public sector workers. “They are the services which civilise our society.” Glasgow had another 10,000-strong rally by strikers.

In Inverness, strikers wearing Danny Alexander masks and carrying “swag bags” descended on the constituency offices of the chief secretary to the Treasury, protesting at his pensions “cash grab”.

Alexander, the Lib Dem MP for Inverness, Nairn, Badenoch and Strathspey, has become the chief hate figure within the UK government for Scottish union leaders because of his government role as one of the leading pension negotiators.

For many, such as Inspector Russ Aitken from Mersey Tunnel police, it was the first time they had taken industrial action: “I feel angry that I’m paying a 50% increase in pension contributions and I feel angry that I’m going to have to work longer.”

Court staff also found themselves on picket lines.

Norina O’Hare, from the justice and prosecutions sector of the PCS union, said: “We’ve had a lot of support from judges who are, of course, also public sector workers.”

Article source: http://www.guardian.co.uk/society/2011/nov/30/unions-ministers-public-sector-strike

Construction company Carillion has warned 4,500 staff their jobs are at risk because of government plans for a dramatic cut in solar energy subsidies.

The company has begun a statutory 90-day consultation period in its energy services division prior to the anticipated slashing of feed-in tariffs.

The tariffs, known as FITs and paid by energy companies to households and communities who produce electricity via solar panels on their roofs, would be more than halved under government proposals.

Ministers are also proposing cutting the subsidies by 12 December instead of April 2012, the date the solar industry is calling for.

It is feared the changes could pose problems for Carillion, whose business includes a project to install and manage 30,000 solar panels for local authority and social housing. It is understood that the number of redundancies at the firm, which employs 50,000 staff worldwide, will be well below 4,500, but Carillion said it was too early to speculate on what the final figure would be.

The company said in a statement: “As a result of the government’s changes to feed-in tariffs for solar photovoltaic installations, Carillion Energy Services proposes to accelerate and widen [its restructuring] programme.

“Our solar business was growing strongly, but we expect the government’s plans for much larger and earlier than expected cuts to feed-in tariffs to reduce the size of the solar PV market significantly. In order to react to the effects of this on our business, we have launched a statutory 90-day consultation process with our people on how we can reshape our business.

“Until the consultation process is complete it is too early to speculate on how many people will be affected, especially as we will explore all opportunities for redeployment.”

The plans to slash financial incentives for installing solar panels has provoked anger from green groups, with Friends of the Earth planning to mount a legal challenge.

The Department of Energy and Climate Change acknowledged the proposed changes would be “very difficult” but insisted it wanted an enduring future for the solar industry.

“If we left things as they are, the FIT budget would be eaten up entirely, and that would be even worse for those in this sector and those working on other technologies too,” a spokesman said.

“We believe solar PV can have a strong and vibrant future in the UK and we are proposing changes to ensure a lasting FITs scheme to support that future.”

Article source: http://www.guardian.co.uk/environment/2011/dec/01/carillion-job-cuts-solar-energy

Farmland birds in Britain have declined to their lowest numbers ever recorded, despite efforts in some parts of the country to protect them from damaging changes to their habitats.

The number of birds that forage and nest on farmland has fallen 52% overall in the past 40 years, with some species, including turtle doves, grey partridges, starlings, tree sparrows and corn buntings down more than 80% over the same period.

The turtle dove is now the UK’s most threatened farmland bird and in danger of being wiped from the British landscape entirely, conservationists said.

Other farmland species, including yellow wagtails, lapwings and greenfinches, are also in worrying decline. While most species are suffering from changes in land use and farming practices, the greenfinch is falling victim to the disease trichomoniasis.

“The decline of the turtle dove is particularly worrying,” said Martin Harper, conservation director at the Royal Society for the Protection of Birds (RSPB). “This is a beautiful bird which has an iconic connection with the British rural landscape and we are only now starting to discover what is causing its population to plummet so alarmingly.”

More intense and efficient farming has hit birds that eat seeds from crops and farmland weeds, particularly over the winter months, even as some farmers have tried to limit the damage by planting wildflower margins and skylark plots, leaving stubble unploughed over the winter, and by not overgrazing their land.

Numbers of goldfinches increased most on farmland, with whitethroats, stock doves, wood pigeons and jackdaws all seeing small rises.

The bleak picture is revealed in the latest UK Wild Bird Indicators, published on Wednesday by the Department for Environment, Food and Rural Affairs (Defra), the RSPB and the British Trust for Ornithology. The report shows that populations of British birds remained fairly stable overall between 1970 and 2010, but highlights huge variations between wetland, woodland, farmland and sea birds.

“Almost all of this information is collected by volunteers,” said David Noble of the British Trust for Ornithology. “We are seeing more communities with large numbers of generalist species, while specialist birds are disappearing.”

Numbers of woodland birds have dropped by a fifth since 1970, but there were winners and losers within the group. Seven species, including nightingales, wood warblers and willow tits, fell by 70%, while populations of green woodpeckers, blackcaps and sparrowhawks more than doubled.

The driver for the overall reduction in woodland birds is uncertain, but conservationists point to a decline in woodland management, overgrazing by deer and the ageing of woodlands as major factors.

The warming climate appeared to be taking a toll on some species. Though seabirds are up 30% on their numbers in 1970, some fared much worse than others. Of most concern are kittiwakes, which declined 34% in Britain, and are suffering a similar fate across continental Europe. The declines have been linked to warmer sea surface temperatures that have shifted bands of plankton in the North Sea, leading to a fall in sand eels that the birds feed on.

Arctic skuas did well between 1970 and 1985, but their populations have since fallen by half. Guillemots fared better, rising 168% over the period.

Some of the greatest increases were among birds that overwinter in Britain, but these are temporary residents and rises in this country are likely to correspond to falls elsewhere. Among wintering wildfowl, numbers of Svalbard light bellied brent geese rose 21-fold, while avocets, a species of wader, increased 41-fold.

Harper said the government’s enthusiasm for new building projects, emphasised in George Osborne’s autumn statement on Tuesday, posed a major new threat to wild birds that are already suffering from worsening habitats and the loss of dietary staples.

“We should welcome the increase of some species, but we seem to be facing a growing number of threats. The chancellor’s determination to rip up the environmental rule book drove a particularly icy blast across an increasingly bleak landscape for wildlife,” Harper said.

Article source: http://www.guardian.co.uk/environment/2011/nov/30/turtle-doves-wild-birds-britain

A former official in charge of investigating potential breaches of privacy by newspapers for the information commissioner told the Leveson inquiry that he was ordered to back off because the newspaper groups were “too big” to take on.

That was despite his uncovering a cache of documents showing thousands of ex-directory telephone numbers were being obtained on behalf of journalists. The numbers included those of the parents of Milly Dowler, and well as those of Charlotte Church and Sara Payne.

Alex Owens, who had spent 30 years in the police force, said every newspaper apart from the “Dandy and the Beano” was named in the documents uncovered as part of the Operation Motorman investigation in the early part of the last decade.

Evidence of the illegal access of private data was recovered in a raid on the Hampshire home of private investigator Steve Whittamore on 8 March 2003, the inquiry heard. In four notebooks, coloured blue, red, green and yellow, Whittamore had documented 17,000 to 17,500 requests for confidential data ranging from criminal records; to car ownership details to ex-directory telephone numbers.

Giving evidence, Owens said “the names of people like Milly Dower’s number, ex-directory numbers and that sort of thing” all appeared and he questioned why no-one saw fit to pursue it, given what is now known about phone hacking.

Whittamore’s paperwork named the reporter and the newspaper for every journalist’s request, who they worked for and details of the “blaggers” who got the information from official sources on his behalf. None of those journalist’s names have ever been published.

“We were in a position to prosecute everyone in the chain from the ‘blagger’ right up the journalists and possibly even the newspaper groups,” Owens said.

He told Leveson how he went to the head of the Information Commissioner’s Office (ICO) Richard Thomas and his deputy Francis Aldhouse to report his findings. “It was at this point Francis Aldhouse [former deputy head of the ICO], with a shocked look on his face, said ‘we can’t take the press on, they are too big for us’,” Owens said.

“Richard Thomas did not respond. He merely looked straight ahead appearing to be somewhat bemused by the course of action I was recommending. For my own part I remember thinking ‘It’s our job to take them on or indeed anyone else on, that’s what we are paid to do. If we do not do it then who does?”

He blamed “fear” at the ICO and said his bosses “had drawn a red line” between press and the reporters at the top and “the private investigators, the little blaggers and the corrupt people” below who they were allowed to investigate.

Owens says he decided to go public and potentially face prosecution because he believed it was in the public interest. He denied his evidence was “unreliable” because he had lodged a “grievance” against the ICO.

Owens told reporters outside the hearing that he and his co-investigator had planned to concentrate on about 20 to 30 of the worst offenders in the list of 305 journalists in Whittamore’s notebooks but no journalists were ever contacted. “We weren’t allowed to ask the press why did you want it [confidential information]?” said Owens. This decision to stop the investigation at such an early stage would “never ever happen” in the police, he said.

His allegations came on the day that:

• Detectives investigating phone hacking at News International arrested a 31-year-old woman, believed to be Bethany Usher, a former journalist who had bylines in two Sunday newspapers in 2005-08.

• Ian Paisley Jr, the MP for North Antrim, confirmed that he had met officers from Operation Weeting, who are investigating whether he and his father, the former Northern Ireland first minister, were targeted by phone hackers.

• And, also at the Leveson Inquiry, a lawyer for phone-hacking victims accused Rupert Murdoch’s News International of trying to “destroy” his life.

Mark Lewis, whose clients include the family of Milly Dowler, described being shown a “truly horrific” surveillance video of his ex-wife and 14-year-old daughter shot by a private detective commissioned by the publisher of the News of the World. He said: “News International sought to destroy my life, and very nearly succeeded.”

Earlier, Tony Blair’s former communications director Alastair Campbell told Lord Justice Leveson that Cherie Blair’s friend Carole Caplin had told him her phone had been hacked and she suspected that may have been how information about the Blair family, including Cherie’s pregnancy, got to newsdesks.However he said he had “no evidence” specifically that journalists intercepted the voicemails of Cherie Blair or Caplin but queried the source of a number of articles about the former prime minister’s wife.

“I do not know if her [Caplin's] phone was hacked, or if Cherie’s was, but knowing what we do now about hacking and the extent of it, I think it is at least possible this is how the stories got out,” Campbell said in his witness statement.

Article source: http://www.guardian.co.uk/media/2011/nov/30/leveson-inquiry-dowler-phone-hacking

High inflation, cuts and the longest period of wage stagnation on record will see the spending power of the average British family plummet over the next five years, a leading thinktank warned on Wednesday.

An Institute for Fiscal Studies analysis predicted that average incomes, adjusted for inflation, will fall by 3% this year and further in 2012. The director of the IFS, Paul Johnson, said: “In the period 2009-10 to 2012-13, real median household incomes will drop by a whopping 7.4% – a record matched only by the falls seen between 1974 and 1977.”

As up to 2 million public sector workers walked out in protest against changes to their pensions, and signs emerged of a potentially damaging rift within the Liberal Democrats in the wake of George Osborne‘s autumn statement, the thinktank warned that families with children will be worse off in 2016 than they were 14 years earlier as they cope with more than a decade of austerity.

The IFS’s warning and the strikes came as The oil price shocks of the 1970s forced the then Labour government to survive on IMF handouts and push through steep spending cuts and public-sector wage freezes. But wages recovered their previous spending power within four years.

the world’s major central banks announced joint emergency measures to stop the international financial system from freezing up, and pushing the global economy into another recession. The measures included cutting emergency interest rates on dollar loans to cash-strapped European banks.

A Downing Street spokesman said the emergency measures were necessary because the markets were under extreme strain. “We are experiencing a credit crunch and that central bank action is about trying to mitigate the effects of that credit crunch,” the spokesman said.

Not since the Callaghan government of the mid-70s have families come near to suffering a similar loss of income as the one now predicted to hit Britain over the next five years, the IFS said.

Lower income groups, it confirmed, will bear the brunt of the government’s latest cuts, outlined by George Osborne on Tuesday. The chancellor’s autumn statement signalled that the deteriorating economic outlook meant that there would be two more years of austerity than originally planned in his March budget.

Anti-poverty campaigners said the IFS figures showed that the coalition had shifted the burden of paying for the deficit on to the most vulnerable.

Alison Garnham, chief executive of the charity Child Poverty Action Group, said: “The IFS analysis confirms that the chancellor’s new tax and benefit measures are a takeaway from low-income families with children to those at the middle and top. It is particularly perverse to reduce incomes of the lowest-paid working families by reducing tax credits when this is the group the government claims it wants to help through improved work incentives.”

The IFS analysis of the UK’s current economic woes, and the coalition’s reaction to them, both suggest that real median household incomes – where higher wages and salaries are adjusted to account for higher prices – will be no higher in 2015 than they were in 2002. A couple with no children typically enjoyed a weekly income of £437 in 2002 but by 2015 that will have dropped in real terms to £433. For a couple with two children the weekly income falls from £612 in 2002 to £606 in 2015. In the nine years since 2002 the cost of living has increased 30%.

The IFS analysis showed the unemployed and pensioners living on state benefits would do better than working families after benefits were linked to the 5.2% rise in inflation. Johnson said: “Failure to index some elements of tax credits, and the reversal of decisions to increase child tax credits in real terms, will leave some poorer families worse off and will lead to an increase in measured child poverty.”

The IFS based its estimates for the squeeze on incomes on forecasts from the Office for Budget Responsibility, the independent watchdog that oversees Treasury spending plans and which published its own outlook for the economy alongside Osborne’s statement.

It blamed a repeat oil price shock for most of the cuts in real incomes suffered by UK households. High energy prices were the largest single element fuelling an inflationary spiral that left many families worse off.

TUC general secretary Brendan Barber said there was an “unprecedented crisis” in living standards. “You can’t build a sustainable economic recovery on the back of people getting poorer,” he said.

“Rather than further hammering consumer confidence with public sector pay caps and cuts in working tax credits, the government needs to put greater emphasis on wage-led growth, starting with a fairer tax system where everyone – including the super-rich – pays their share.”

Shadow home secretary Yvette Cooper said the IFS report revealed the poorest 30% of households would lose more than three times as much as the richest 30%.

Official data this week showed UK families’ weekly spending fell last year to the lowest in real terms for at least seven years. They cut back on spending on leisure to try to pay for housing, energy and transport costs. One of the big pressures facing households is high inflation, which has left most people worse off in real terms.

Pay growth for workers in Britain hit a record low between 2010 and 2011, according to official data last week. Pay was up just 0.4% on a year ago in terms of gross weekly earnings, meaning that incomes are tumbling in real terms, given that inflation stands at 5%. The Office for National Statistics also said the gap between Britain’s highest and lowest paid workers had widened dramatically over the past year.

The IFS said one group whose incomes “are certainly being squeezed” is public sector workers. Its analysis suggests that the two years of on average 1%-a-year pay rises in the public sector to follow the current two-year pay freeze would be enough to wipe out the estimated pay gap between men in the public sector and private sector.

The thinktank puts the gap between public and private earners at 4.3% for men, taking into account education, age and qualification levels. For women the public sector premium is 10.5% and for both men and women it stands at 7.5%.

The IFS also looked into differences in public sector benefits across the UK. “Looking at pay alone, public sector workers appear, on average, to do relatively badly in London and the south-east and really rather well in some other areas including Wales and the north of England,” Johnson said. The findings echo Osborne’s move on Tuesday to ask public sector pay review bodies to look into how pay can be made more responsive to local labour markets.

Following forecasts for contraction at the end of this year and barely any growth next year, Osborne was forced to concede on Tuesday that the UK risked falling into recession. The resulting strain on the public finances led the chancellor to pencil in two more years of substantial cuts.

“That will extend to six years the period for which total spending will have been cut year-on-year,” said Johnson. “One begins to run out of superlatives for describing quite how unprecedented that is.

“Certainly there has been no period like it in the UK in the last 60 years.”

Article source: http://www.guardian.co.uk/uk/2011/nov/30/austerity-biggest-fall-family-income