Things have moved on from the 1980s. Globalisation has broken the insular link between wages and prices. We import nearly all our consumer goods priced in dollars or Euros or Yen. The decline of Sterling due to Brexit makes these goods more expensive – not least oil and gas.
The favourable trade arrangements we had as an EU member no longer apply and we pay more for our imports. Whilst exports, particularly invisible ones, help the trade balance we are losing our competitiveness to those within the Single Market and the Customs Union.
Our public services are under stress, starved of investment and in many cases of foreign labour. Reduce the supply and the price goes up – inevitably inflationary pressure results. The market mechanisms of being a member of an economic union with huge supply of labour and capital kept prices under control. Without them there is inflationary pressure.
In short many of the causes of inflation are a consequence of our decision to abandon international partnerships for ideological nationalist reasons. If public sector wage controls are the only lever we can pull the cost in bad industrial relations and poverty will be considerable.
Paddy’s Blogs in a crazy world 