Lessons from a decade of failed austerity

New analysis published by the TUC this week has revealed just how much a decade of cuts has harmed millions of lives

We all need good schools and hospitals, safe neighbourhoods and a decent home. Parks, sports centres, libraries and colleges are important too – they help people flourish.

But new analysis published by the TUC this week has revealed just how much a decade of cuts has harmed millions of lives.

It also shows that working class families have lost most. Because when services are cut, only the wealthy can pay for private services instead. Working-class families simply lose out.

That’s why we’re calling on the government to rebuild and restore our public services, so that whatever your background you get a fair chance in life too.

Widening class gap

The new analysis by Landman Economics shows that the working classes have lost most from a decade of public services cuts.

The figures below are for England, and the services included in the analysis are health, schools, early years, social care, housing and police.

Impact on households

Families in the lower half of household earnings have lost services to the average value of £696 (annually), compared to £588 for those in the upper half.

The largest losses were for the lowest earning decile of households, at £829, closely followed by the second lowest decile at £794.

However, financial value alone does not tell the full story. Wealthier households can more easily absorb these losses by paying for services in the private sector. But low and middle-earning households are much less able to afford it.

The relative impact is shown more clearly when the losses are presented as a proportion of earnings, as in the chart below. For the lowest decile, the cuts are equivalent to almost a fifth (18%) of their earned income, compared to just 0.4% for the highest decile.

Impact on life chances

Cuts to services affect not only quality of life, but also future life chances.

High-quality provision of services like education, health, disability services and social care can make sure that everyone has a good childhood a decent quality of life. 

Other services allow people from working class families to gain experiences that only wealthier households can afford through private incomes – such as parks, recreation centres, youth clubs, libraries and cultural events.

Reverse the cuts

It’s clear that the last decade of services cuts are widening the class gap.

Everyone deserves to live near a good school or hospital, not just the wealthy. It’s time to reverse the cuts and rebuild our once proud public services.

Lessons from a decade of failed austerity

Full report here.

A decade on from the global financial crisis, the British economy faces increased risk of renewed recession. Alongside weak domestic growth, global economic growth is at its weakest since the crisis and the risk of a no-deal Brexit remains high.

Any preparation for recession must involve learning the lessons of the government response to the last one.

This paper shows how the cuts imposed after the last recession, both in the UK and in much of the developed world, harmed economic growth, with a heavy impact on workers’ pay.

Overall, pay growth has halved across OECD countries in the decade since the GFC. In real terms, annual pay growth has been below one per cent a year for two thirds of countries.

Policymakers and politicians wrongly attribute this entirely to ‘productivity’, despite a failure to find convincing supply-side explanations for the change in growth at a time when controversial policies are acting on demand.

Calls for government expenditure in the face of renewed recession are already widespread, but ‘austerity thinking’ still constrains the options for fiscal policy going forwards.

Recommendations

  • The government should ask for an independent review of how the Office for Budget Responsibility and Bank of England judge the impact of government expenditure on the economy, assessing the critical assumptions on multipliers, the output-gap and the ‘NAIRU’ given the international experience of the austerity decade.
  • Immediately deploy fiscal policy to support aggregate demand according to this changed view, expanding government (current) expenditure on public sector salaries and services.
  • Fast-track increases in public infrastructure spending to the OECD average of 3.5 per cent of GDP.
  • Increased expenditure should be financed by borrowing rather than increased taxation in the first instance. This is not equivalent to deficit spending, as a stronger economy will improve the public sector finances.
  • Use fiscal policy as part of a wider plan to deliver sustainable growth across the UK, including investing in the public services families rely on, the skills workers need for the future, a just transition to net zero carbon emissions, and giving workers a real voice at work. 

Vigil tomorrow: After 39 Tragic Deaths, Safe Passage Now

Today our thoughts and solidarity go to the 39 victims, found dead in a lorry in Essex and their families.

The 39 are the latest victims of Fortress Europe and this government’s “hostile environment” for refugees and migrants that sees people forced to turn to traffickers to escape poverty and war.

Thousands have died attempting to reach Europe, and thousands remain stranded while being denied their right to seek asylum in Britain.

Tomorrow we are holding a vigil with refugee groups Care4Calais and Safe Passage to commemorate the victims, demand safe passage for those fleeing poverty and war, and that the racist hostile environment must end.

Join us to send solidarity to the loved ones of those who died and demand immediate change to ensure such a tragedy does not happen again.

AFTER 39 TRAGIC DEATHS:
VIGIL: SAFE PASSAGE NOW

Thursday 24th October 6pm
Home Office, 2 Marsham Street London SW1P 4DF
Click here to view the facebook event

PCS win London Living Wage at BEIS after months of indefinite strike action

ISS staff working at BEIS have won “gold standard” terms and conditions, including the London Living Wage after 3 months of indefinite strike action.

Porters, security, post room, cleaners and receptionist staff have all taken rolling strike action in the long running dispute since ISS took over the contract in January this year.

And cleaners took the decision to take indefinite strike action for 3 months in order to win a just settlement.

Members of the Public and Commercial Services Union (PCS) won better pay, sick pay and increased annual leave following the action.

Caterers working for Aramark who were also on indefinite strike won their dispute last month.

The protracted dispute saw huge picket lines, a foodbank being set up in the department because pay was so low and solidarity from across the trade union movement.

Reacting to the win by workers at BEIS, PCS general secretary Mark Serwotka said: “This has been a heroic effort by our members from start to finish.

“They have shown the entire trade union movement that when you stick together and strike together, anything is possible.

“Our members who are mainly migrant workers, have endured immense hardship with the local branch having to set up a food bank to support workers due to pay being so low.

“ISS have been a very intransient employer and if wasn’t for the steadfastness of our striking members, they would not have won a just settlement.

“This whole episode underlines the clear need for all private contracted out staff in government departments to be immediately brought back in house and given civil service pay and conditions.”

Follow PCS on Twitter @pcs_union 

Don’t sack 12,000 Asda workers just before Christmas

Asda workers have been told to sign the contracts – which will see them lose all their paid breaks and forced to work bank holidays – or be sacked on November 2 in the run up the Christmas.

Asda workers have been protesting outside stores up and down the country, while more than 1,000 turned out for a protest in August.

Today we are back in the birth place of Asda – once a proud, family company – calling on bosses to respect workers and offer them a better deal.

Gary Carter, GMB National Officer

Latest company accounts show directors trousered a whopping £12million last year – and profits rocketed more than £92 million – at the same time Asda slashed 5,000 jobs

Gary Carter, GMB National Officer, said:

“Tens of thousands of members of the public are backing our Asda workers in their fight against these Draconian contracts.

“Contract 6 is shocking – the changes are forcing our members to choose between looking after their families, or being able to support them. It’s a disgrace.

“Today we are back in the birth place of Asda – once a proud, family company – calling on bosses to respect workers and offer them a better deal.”

Stand with Asda workers – sign our petition

Fighting Bolsonaro: Solidarity with Brazil Thursday 24 October 2019 @ 5.30pm, Congress House

The workers of Brazil knew what was coming long before the rest of the country. A concerted assault on the labour movement and the rights of workers paved the way for the election as President of the far right demagogue Jair Bolsonaro, who has used his position rewrite the history of Brazil’s military dictatorship, and to fuel hate crime with his racism, homophobia and misogyny.

But the trade union movement remains at the core of resistance, with 45 million workers striking in June against Bolsonaro’s policies and unions building resistance on the streets, in workplaces and in Congress.

We will hear from Antonio Lisboa, the international secretary of Brazil’s biggest union organisation, the Central Workers’ Union (CUT), who will tell us of how workers and their allies are fighting not only for democracy, but “for civilisation”.

Danielle Rowley MP, the Shadow Minister for Climate Justice and Green Jobs, will talk about how the far right poses a threat to planet as well as people, as shown by the rampant deforestation revealed in Brazil this summer.

Baroness Christine Blower, Vice Chair of the Brazil Solidarity Initiative, and other speakers TBC, will speak of the international solidarity needed to defend the Brazilian people’s rights and challenge the international growth of the far right.

COMMUNICATION WORKERS’ UNION Members cheer as 97.1% strike vote announced

Hundreds of CWU reps waved their union flags and cheered as the “historic” Royal Mail ballot result was announced after a national reps’ briefing in central London earlier today.

In one of the largest ‘Yes’ votes and biggest turnouts for many years, CWU members in Royal Mail Group, not including Parcelforce members, voted by 97.1 per cent for strike action.

For legal reasons, our Parcelforce members were balloted separately in two separate ballots – one on the controversial ‘TUPE’ proposals and the other on the rest of the issues in dispute.

And both of these returned massive ‘Yes’ votes as well – 94.7 per cent and 95 per cent.

As the details of the balloting were read out by the union’s president Jane Loftus, loud cheering erupted, echoing loudly around the main hall of Euston’s Friends Meeting House.

Members of the press, who had been invited in to hear the announcement, immediately sent the news reverberating around the nation.

And in their eager questions to our general secretary Dave Ward and deputy general secretary postal (DGSP) Terry Pullinger, reporters all wanted to know when strike action could take place.

Media speculation had been building that Christmas or even November’s ‘Black Friday’ could be impacted by potential walkouts, but both Terry and Dave made clear that this would be entirely up to the Royal Mail leadership.

In his initial reaction to the announcement, our DGSP reminded the audience that “just over one year ago, the Royal Mail Group Board and the CWU agreed a blueprint agreement for the future, an agreement that included an historic pension solution, a mutual-interest-driven relationship and a joint vision for a successful postal service with social aims.”

But the new leadership of the company was now, he continued, “breaking that agreement.

“Our members take honour seriously and have voted to fight for that agreement against those who now seek to break up the Great British Postal service in the interest of fast-track profit and greed.

“Integrity and pride still matter and we will not stand aside and see what we have spent our working lives building destroyed,” Terry insisted.

General secretary Dave Ward said that the result had been “historic” and warned the company leadership that they “cannot face away” from it.

“The workforce has completely rejected the company’s plans to set up a separate parcels business and allow UK postal services and thousands upon thousands of jobs to wither on the vine,” Dave added, highlighting other issues of grievance, such as increased workload pressure on members, driven by technology.

“This dispute goes to the heart of everything that is wrong in today’s world of work,” the general secretary continued, vowing to “fight the board’s asset-stripping plans, not just through strike action, but by speaking directly to major shareholders, politicians and the public.

“We will build a coalition for change and deliver an exciting and innovative future for Royal Mail, with an expanded role for postal workers in supporting local communities and growing the economy.”

TUC LESE regional Trades Council briefing

Saturday 16 November 2019, 11-4pm, TUC Congress House, WC1B 4LS

Our 2019 regional trades council event will include an opening address by Simon Weller, ASLEF Deputy General Secretary and TUC general council member of the national Trades Council Joint Consultative Committee.

Discussion on the national trades council programme with our TUCJCC representatives Tommy Anderson (London and South East) and Andrew Coburn (East of England).

Sessions focused on trades council and union campaigning on; Housing, combating the far-right and Universal Credit.

The day will be a chance to meet and talk with colleagues from trades councils across our region.

Trades councils are welcome to send as many representatives as you like, but where requested we will meet travel expenses (by public transport) for two people from each registered trades council, less the first £5 per person. Please register with Joanne Williams Jowilliams@tuc.org.uk 020 7467 1218.

Please note in the event of a general election being called this event will be postponed if it falls within the campaign period.

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