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Tag Archives: 2015
The “disastrous” performance of this Tory-led government was not accidental. It was entirely deliberate.
One conversation I once had with Jos Bell (twitter here), an incredibly productive campaigner and chair for the independent Socialist Health Association London division, had much more of a profound impact than I thought at the time.
I simply remarked that the Conservative-led government had been ‘disastrous’.
Jos disagreed. She pointed out that the term of office had gone extremely successfully for the few who’ve made shedloads of money through private equity and hedge funds.
A massive assumption we’re all prone to make, some more than others, is that the political class largely represent us and our interests.
The number of ‘lost votes’ is the reminder to all of us of how disconnected parliamentary politics have become with our needs and concerns.
There are, of course, some truly outstanding MPs, however.
Another realisation for many, almost a right of passage, is the “lightbulb moment” that some leading ‘independent’ health and care think tanks have not been offering useful reliable impartial advice after all.
The performance of some on the issue of competition, a shoo-horn for neoliberal markets, against the wishes of many professionals, is a testament to them.
Dodgy advice was used to prop up the business case for the Health and Social Care Act (2012), and it is going to take a long time to unwind from this.
I know of the misery that the ‘welfare reforms’ have had on the morbidity and mortality of disabled citizens. This does not prevent ATOS from fulfilling a lucrative contract, which was made under the last Government (Labour).
There are accusations and counter-accusations of the effects of injection of private capital, the private finance initiative, which many hope will be addressed properly by the incoming government next year. City financiers and law firms continue to benefit from this sustained policy which has reaped havoc on various ‘local economies’ of the NHS.
The sale of Royal Mail, and various other projects, into the private sector at an undervalue (it is alleged) clearly has not been to the best benefit of the taxpayer. But again many in the City, some alleged to be close to the current Government, have benefited personally (it is alleged).
Through the prism of me and my friends, this Conservative-led Government has been ‘disastrous’. But they’ve actually achieved a lot for themselves in the last few years in the tenuous argument of ‘austerity’.
The buzzword for George Osborne was ‘choice’, and you could hear a pin drop literally at George Osborne’s reassurance in his speech yesterday, “We’re all in it together”.
I simply can’t agree with political commentators who wish to pollute the discussion with their meme that ‘Labour do not wish like a party who wish to govern.”
Many grassroots activists in Labour are desperate to sort out the mess the country finds itself in.
They certainly detest the idea of a Tory-UKIP coalition.
The repeal of the Health and Social Care Act (2012) will be in the first Queen’s Speech of an incoming Labour government.
This Act of parliament turbo-boosted the aggressive pimping of NHS contracts into private sector providers. Correct – another set of beneficiaries from this government, led by the Conservatives but the lifeblood of which is currently provided by the Liberal Democrats.
In many ways, the next period of office is a ‘poisoned chalice’ once again, with debt in the last four years 4 x as much as the debt amassed by Labour in 13 years.
But, to repeat David Cameron, “we can’t go on like this”.
And the goalposts keep on moving.
An identifiable threat still remains having a means-tested social care service bolted onto the ‘universal’ health system, like a badly soldered “lemon car”.
A threat, less visible on the event horizon, is the corporatisation of general practice in the English jurisdiction.
I suspect that, despite the noise produced by UKIP and LibDems, the NHA Party will fail to make inroads in seats in the actual election. This will be of great sadness to me, despite the fact I wish all Labour candidates very well, as they are clearly campaigning on many relevant issues.
I feel that Labour will win the next general election. But I am terrified that, like the aftermath of 1997, it will be another missed opportunity for us.
The solution to the current malaise is not more extreme social democracy
There’s an argument from some that more trenchant tax rises, such as VAT or income tax, and ‘getting more from less’, will be enough to see through an incoming Labour government led by Ed Miliband.
Put quite simply, I don’t think this will be nearly enough. It would the best Labour could come to retoxifying its own brand, reestablishing its credentials as a ‘tax and spend’ government. In fact, for the last two decades, the taxation debate has got much more complicated due to an issue nobody wishes to admit. That is: you’re not actually using taxpayers’ money to go into the salaries or wages of employees of the State, you’re increasingly using this tax to subsidise the shareholder dividends of directors of outsourced public functions (such as beneficiaries of health procurement contracts). Whether you like it or hate it, and let’s face it most people are ambivalent to it, resorting to this would ignore all the groundwork the Miliband team has done on “pre-distribution”. Forgetting this actual word for the moment, making the economy work properly for the less well-off members of society should be an explicable aim of government on the doorstep. Putting the brakes on the shock of energy bills, from fatcat companies, is a reasonable self-defence against an overly aggressive market which has swung too far in much favour of the shareholder and director. Paying people a living wage so that they’re not so dependent on State top-ups to survive is as close as you can get to motherhood and apple pie. Even Boris Johnson supports it.
Of course, Ed Miliband’s natural reaction as a social democrat would be try and survive government as a social democrat. But that doesn’t get round the problem experienced by a predecessor of his, Tony Blair. When Tony Blair had his first meeting with Robin Butler (now Lord Butler of Brockwell), Butler asked, “I’ve read your manifesto, but now what?” Ed Miliband has low hanging fruit to go better than Tony Blair on his first day in office if he can come up with clear plans for office and government.
Let’s get something straight. I don’t agree that the scenario which must be proven otherwise is that Ed Miliband will come into Downing Street only enabled by Liberal Democrat voters. There are plenty of former Liberal Democrat voters who feel deeply disgusted by Nick Clegg not acting as the ‘brake’ to this government, but as the ‘accelerator pedal’. They have seen Clegg’s new model army vote for tuition fees, privatisation of the NHS, and welfare reforms, as if there is no tomorrow. And for many of his MPs, there will be no tomorrow. Clegg’s operating model of supplying votes for whichever party happens to be his employer is clearly unsustainable, as within two periods of office, his flexible corpus of MPs would end up repealing legislation that they helped to introduce to the statute books.
In answer to the question, “What do we do now?”, Ed Miliband does not need to reply with a critique of capitalism. Miliband will have to produce a timeline for actions which he has long promised, such as implementation of a national living wage, controlling seemingly inexorable increases in energy bills, as well as other ‘goodies’ such as repealing of the Health and Social Care Act (2012).
Andy Burnham MP, Shadow Secretary of State for Health, has already explained some of the ‘and then what’. Burnham has insisted that he will make existing structures ‘do different things’. But while getting of compulsory competitive tendering, Burnham needs to put ‘meat on the bones’ on how he intends to make the NHS work without it being a quasimarket. Burnham’s challenges are not trivial. Burnham seemingly wishes to maintain a system of commissioning, while intending to abolish the purchaser-provider split. Burnham also seemingly wishes to support local A&E departments in not being shut down, but has as not yet stated clearly what he thinks will work better than the current amendment of the Care Bill going through parliament for NHS reconfigurations. Furthermore, Burnham in advancing ‘whole person care’, in sticking to his stated unified budgets, may have to resist seeing the merging of the non-means tested NHS being merged with the means-tested social care. This might easily lead to ‘mission creep’ with merging with welfare budgets. And this brings up a whole new issue in ‘integrated care’ which Burnham has long denied has been on the agenda: “top up payments” or “copayments”. Reducing health inequalities by tackling inequalities social determinants of health should of course be well within the grasp of a socialist-facing NHS delivered by Labour. With patient safety also, correctly, a top priority for the National Health Service, especially for how frail individuals received medical care in hospitals, Burnham has in fact five timelines to develop fast as top priorities: health inequalities, commissioning, reconfigurations, whole person care, patient safety.
The global financial crash should have given some impetus to the Marxist critique of capitalism, but it didn’t. Tony Benn said famously that, when he asked to think of an example of ‘market forces’, he would think of a homeless person sleeping in a cardboard box underneath Waterloo Bridge. Benn further pointed out that the NHS was borne out of war, where normal rules on spending went out of the window: “have you ever heard of a General saying he can’t bomb Baghdad as he’s overrun as his budget?” However, it was not the global financial crash which caused there to be far too many people who feel disenfranchised from politics. Capitalism always drives towards inequality. It also drives towards economic and political power being rested at the top. The reason why people are well off tell you it’s important to do more with less is that they have a fundamental poverty of aspiration about this country. They don’t particularly care as the most well off are getting even more well off. This is an economic recovery for the few. The economy is not going to grow on the back of a record people with zilch employment rights under “zero hours contracts”. The economy is not going to grow either on the back of a property-boom based in London, even if a sufficiently large number vote Conservative as a result of a bounce in their property prices.
What there is a risk of, however, is socialism being popular, and this of course goes beyond the follower number of a few certain individuals on Twitter. Across a number of decades, particularly in Sweden and Cuba, we’ve been able to learn good lessons about what has happened in the worlds of communism and social democracy, as a counterpoint to capitalism. Tony Benn, when asked to give an example of ‘market forces’, would always cite the person sleeping rough under Waterloo Bridge. The Labour Party, most recently, in large part to Tony Blair being ideologically being ‘of no fixed abode’, has run away from socialism, meaning narratives such as Jacky Ashley’s recent piece are consciously limp and anaemic, a self-fulfilling prophecy of utmost disappointment. There is no sense of equality, cooperation or solidarity, and these ought to be traits which are found to be at the heart of Labour’s policy. If Ed Miliband hasn’t thought of how the answer to ‘Now what?’ fulfils those aims, it’s time he had started thinking about. With this, he can not only build a political party, but build a mass movement. With people choosing to become members of unions, and there is no better time with such a naked onslaught on employment rights, the Labour movement could become highly relevant, not just to very poor working men. Labour has to move with the times too; it needs to move away from reactionary ‘identity politics’, and seek to include people it hasn’t traditionally engaged in a narrative with. This might include the large army of citizens who happen to be disabled or elderly. There is no doubt that a socialist society needs the economy to succeed; if it is really true that the UK sets to be in a dominant position in Europe by 2030, surely the media should be helping the UK perform a positive rôle as a leader. The economy involves real people, their wages, their energy bills, their employment rights, so while it is all very easy to be po-faced about “the cost of living”, or have foodbanks in your line of blindsight, Labour needs to be a fighting force for many more people who otherwise don’t feel ‘part of it’. It should be the case that a vote should buy you influence in shaping society, in as much as the way to buy influence, say in the NHS, is to become a Director of a private health multinational company. This fight against how capitalism has failed can indeed become the alternative to commercial and trade globalisation; a peaceful transition into this type of society is one which the more advanced economies like ours is more than capable of.
Where Labour has thus far been quite successful in trying to make its policies look acceptable to the wider public is courting the opposition. Many would say they have taken this too far. Labour might wish to ‘look tough on welfare’, but Labour can easily advocate employed work being paid for fairly, while being fiercely proud of a social security system which looks after the living and mobility needs of people who are disabled. A radical look at ‘working tax credits’ is possibly long overdue, but Labour will need to get out of its obsession for triangulation to do that. If Labour merely offers a ‘lighter blue’ version of the Conservatives, members of the public will be unimpressed, and boot Labour out asap. Whilst Wilson and Blair both won a number of periods of government, the jury is out especially with what Blair achieved in reality aside from the national minimum wage (which was only achieved with the help of the unions). Many people feel that privatisation was a continuous narrative under Labour as it had been for the Conservatives, and many Labour voters feel intrinsically disgusted at the thought of Tony Blair being Margaret Thatcher’s greatest achievement. People instead of being liberalised by markets have now become enslaved by them. Across a number of sectors, there are only a handful of competitors who are able to rig the prices lawfully between them. The consumer always loses out, and the shareholders with minimal risk receive record profits year-on-year. Of course, rejection of privatisation does not necessarily mean nationalisation, in the same way that decriminalisation of illegal drugs does not necessarily mean legalisation. But it cannot be ignored that some degree of State ownership is a hugely popular idea, such as for the NHS, Royal Mail and banks. Where Ed Miliband might be constructively compared to Fidel Castro (in the days when things were going well for Castro) is that Miliband can set out a vision for a sufficient long period of time for people to become attracted to it (not disenfranchised by it). Thatcher, for all her numerous faults, was very clear about what she intended to achieve. As Tony Benn put it, she was not a “weather vane” but a “Weather cock which is set in a direction… it just happened that I totally disagreed with the direction which she set.”
I think Ed Miliband will surprise people, exactly as he has done so far, in winning the general election on May 8th 2015. I also feel that he will surprise people by having answers to the “And then what?” bit too.
I'm a Labour member who despairs over our leadership on welfare; and I'm not the only one
So what’s new? This is yet another article about Labour and welfare. George Osborne wanted a debate about welfare, but he wants people to be united against ‘shirkers’ staying in bed while good citizens go out-to-work.
I don’t want even to go into that tired debate about working tax credits, and how the people Osborne appears to be targeting are low earners in society. I don’t wish to go into the billions of other arguments concerning this huge part of the budget, for example whether the “millionaire’s tax” would have ‘covered the costs’ of the “bedroom tax”. But increasingly I sense an overwhelming impression from Labour members like me an engulfing sense of despair. This is not about the top 15 things that Labour has promised to repeal or enact on gaining ‘power’, although virtually all of that list has to be cautioned against the state of the economy that any government will inherit in 2015. There are certainly too many variables and unpredictable externalities on the horizon, which makelife difficult. Labour is undergoing a complex review, and indeed people can contribute to the policy discussion through their website. However, there is simply a sense that the Labour Party has lost its identity, and that many people would simply like to quit and “up sticks”. Much of this is that Labour sets out to be a social democratic party, not a socialist party, so therefore has a real ideological problem with saving failing hospitals in the NHS; it paradoxically does not appear to have a problem in saving banks, increasing the deficit, creating billions of bonuses for some bankers in the cities. It engaged in ‘buy now, pay later’ behaviour which meant NHS hospitals, in the name of public infrastructure investment, being put on commercially-confidential contracts lasting decades at interest rates which most agree are competitive.
Labour’s fundamental problem is that it has fallen into the ‘bear trap’ of following not leading. 62% of people think that spending is too high, and indeed Philip Gould, Alistair Campbell and Peter Mandelson are reputed to be fond of ‘focus groups’. However, 99% of Sun voters are reputed to ‘back the Death Penalty’, and no-one is seriously proposing that Ed Miliband should ‘back the penalty’ to get elected. There is a sense that Ed Miliband will jump on any fast bandwagon going, but to give him some credit he has in fact caught a national mood over certain issues such as press regulation. However, many Labour voters feel that Ed Miliband does not share this passion over certain key issues.
Ed Miliband exhibits ‘a stuck gramophone syndrome’ when speaking about “vested interests”, which appears to be Miliband’s contorted way of reassuring the public that the Unions are not round for ‘beer and sandwiches’ every other day. But Ed Miliband simply has to emphasise, as he has tried to do to some extent, that it is the members of the Unions who, uptil now, have backed him not “the Unions” as neolithic organisations per se. Miliband has failed to make clear the essential democratic nature of the Unions, and if he has any sense of history of the Labour Party (which he does), he will wish to emphasise this. If he wishes to make the party wholeheartedly social democratic, he will not care. Surely members of Unions, such as “hard-working” (to use that tired word) nurses and teachers, will wish to have an input into nursing and teaching policy as much as private equity companies who are literally lobbying behind close doors on education and teaching policy? Labour is caught in a trap of advancing neoliberal policies of setting off hospitals against hospitals and schools versus schools, so has totally lost sight of its socialist sense of solidarity. It is currently, on welfare, allowing the debate to be ensnared and enmeshed into a discussion over ‘lazy shirkers’, and one person with 17 children setting fire to his house, but do not wish to establish basic truths about welfare for disabled citizens: that is, the living and mobility components of the current ‘disability living allowance’ do not constitute an employment benefit, but are there to help to allow disabled citizens cope with the demands in life: to use wonk speak, “to allow them to lead productive lives”.
Ed Miliband is also following not leading on the economy. The semantics of whether we should analyse the nature of the boom-bust cycle as FA Hayek would have wished us to do rather than the drawbacks of Lord Keynes’ “paradox of thrift” do not concern the vast majority of voters. However, workers who are being paid pittance, and certainly those below the statutory minimum wage, do not hear Labour screaming out from the rooftops about this achievement, which even happens to be an achievement of a Blair government. Ed Miliband has somehow managed to screw up discussions of ‘a living wage’, not in terms of allowing living standards for workers and employees, but through a convoluted discussion of ‘pre-distribution’ and the academic career of Prof Joseph Hacker (called Mr Hacker by David Cameron in ‘Prime Minister’s Questions’). Workers and employees are concerned that they can be ‘hired and fired’ below the minimum length of service (which this Government is set on reducing anyway), and that any awards for unfair dismissal will be less in future. Voters want some sort of protection through the policies of a Labour government, to curb the excesses of multi-national corporates for example, not a protracted list they can retweet at length on Twitter of the top 15 things Labour would repeal in 2015. This is basic stuff, and it is galling of a Labour opposition not even to do their fundamental job of opposing. Virtually everyone agrees that a strong opposition is essential for English parliamentary democracy.
Labour simply exudes the impression of a political party that has lost its direction, will say or do anything to get into power (while spouting platitudes such as ‘we don’t want to overpromise and under-deliver’), and is totally cautious about what offerings it possibly can supply to the general public in future. Nobody is expecting them to have a detailed manifesto, but a sense of the ‘direction of travel’, in other words people saying that disability living allowance is not an employment benefit, or that Labour would seek to curb his ‘hire-and-fire culture’ and discuss with the Unions how to go about this, would help enormously. Another critical problem is presented by the sentiment conveyed in Adnan Al-Daini’s tweet this afternoon: “If the #Labour party is going to mimic the Tory party at every step what is the point of it? Same policies different rhetoric! #hypocrisy”. Labour, at an increasing number of junctures it seems, appears to be quite unable of opposing convincingly because of its past. I am the first person to promote rehabilitation, but this is genuinely a problem now. It is claimed that Labour introduced the equivalent of the “bedroom tax” for the private sector, so themselves should not be aghast that this has been proposed on an ‘equal playing field basis’. I happen to oppose strongly the “bedroom tax”, as it appears to discriminate against sections of the population, such as disabled citizens. The NHS is another fiasco. Labour ‘as the party of the NHS’ can offer to repeal the Health and Social Care Act (2012), but this is a symbolic (and rather vacuous) promise. The problem with Foundation Trusts still in a ‘failure regime’ will exist, the issue of hospitals paying off their PFI loans on an annual basis will still exist, and it was Labour themselves who legislated for an Act of parliament managing procurement (the Public Contracts Regulations Act); through a long series of complex cases, NHS hospitals have become enmeshed in EU competition law, but Labour had, whether it likes it or not, set in motion a direction of travel where hospitals would be caught in the ‘economic activity’ and competition law axis of the EU.
What Labour obviously did not legislate for was to allow up to 49% of income of hospitals to come from private sources, nor to make the legislative landscape most amenable for private providers to enter with the lowest barriers-to-entry; it was a policy decision of the Conservatives and the Liberal Democrats not to give the NHS any unfair ‘protection’, meaning that the NHS would of course be expected not to provide anywhere near a universal, comprehensive service. However, as the marketisation of the NHS and privatisation has been accelerated, but one in which Labour to a much lesser degree did participate, it is hard for Labour to provide convincingly a narrative on what it wants to do next. Labour seem very eager to produce apologies at the drop-of-a-hat, such as on immigration (which came to a head with the Gillian Duffy altercation after Gordon Brown forgot to remove his clip-on microphone and Sky happened to take a recording of it). It has tried to apologise for the emergency spending on the banks during the global financial crisis, but experts are far from convinced about why the banks were not allowed to fail; it is an inherent paradox in the Labour narrative that it seems content with allowing NHS hospitals to fail, but seems reluctant to allow banks to fail (meaning shareholders and directors of banks can be rewarded, and Labour gets blamed for the exploding deficit).
Against the backdrop of a false security of poll leads perhaps, Labour’s performance is floundering because it just appears to be opposing for the sake of it; it is now a rational accusation of the Coalition to say that Labour opposes virtually everything (except for Workfare and the “benefits cap” perhaps), but does not appear to have constructive policies of its own. Despite its rhetoric on “vested interests”, it seems perfectly happy to honour the contracts it started with ATOS over the disastrous outsourcing of welfare benefits (which has seen 40% of some benefits overturned on appeal, and some claimants reported to have suffered psychological distress through the benefits application process), yet, apart from a handful of excellent MPs such as Michael Meacher, seems rather limp at criticising this particular ‘vested interest’. It is a problem when the public perception of Labour protecting multi-national vested interests overrides its ‘loyalty’ to the Unions. It is also a problem when two years into the leadership of Ed Miliband the media are unable to report the closure of law centres or the problems of the NHS privatisation process but can only report how to self-litigate and what to expect from your GP in this new NHS landscape. Ed Miliband’s fundamental problem is that he gives the impression of being a follower not a leader. Miliband appears like a TV newsreader, nicely a product of “make up”, but whose autocue is suffering a technical fault. Labour does not currently inspire confidence. If it is the case where the best Labour voters can hope for is a ‘hung parliament’, despite glaring incidents of an #omnishambles government, something is very wrong indeed.
Cameron won't get as far as holding a referendum in 2017, as he'll have been shown the door long before then.
The reply “The Tories just feel like crap managers” was in response to my recent question, “Do you think people are excited about politics?” Suzanne Moore instead suggested, “Yes but not the political system or way it is represented.” Olivia simply replied, “If people were excited about politics wouldn’t more people vote? The fact that so few actually bother to vote, suggests that people are far from excited about politics.”
Unusually, somebody in her 60s last week told me that she and her husband were determined to vote in the General Election anticipated around June 2015. Vicky and John are not impressed by the current incumbents but feel passionately that any party is better than ‘this lot’. Returning to the answer, “The Tories are just crap managers”, there is an overwhelming feeling amongst my friends in real life, my 3000 friends on Facebook and 7000 followers on Twitter amongst both my accounts that the Conservatives and Liberal Democrats are playing for time. They offer no leadership, and are sub-standard managers.
They have bungled the forests issue, raised tuition fees, scrapped Building Schools for the Future, scrapped education support allowance, killed a growing economy from 2010, told Europe that they only wish to be in Europe on their own terms, unilaterally decided to scrap GCSEs, outsourced the NHS on the way to privatising it, produced a shambolic budget last year with numerous U-turns, and shut libraries.
The £3bn re-organisation of the NHS, which nobody voted for, was probably the pièce de resistance. The Conservatives have done a disgraceful job of explaining what these reforms mean, and the BBC have made no effort in explaining what is clearly a very significant issue of public interest. The public are none-the-wiser that NHS services have been completely thrown open to the private sector, such that you can walk into a walk-in centre with it having NHS branding but being run to maximise shareholder dividend for a private company. The medical Royal Colleges all opposed it, as did the BMA and the Royal College of Nursing. The marketisation of the NHS means that the service cannot be guaranteed to be anywhere near comprehensive, and already evidence is accruing of definite examples of rationing (e.g. in cataract surgery).
A similar disenfranchisement of key professionals was seen in the high street with the Government, the Conservatives enabled by the Liberal Democrats, ramraiding through the ‘Legal Aid and Sentencing of Offenders Act’ which has seen destruction of legal aid on the high street, killing off access-to-justice for social justice fields such as housing, immigration and asylum, welfare benefits and employment. The marketisation of law on the high-street means that the public are left with an incomplete fragmented service, and again these ‘reforms’ were officially opposed by the Law Society and the Bar Council.
A third disgrace has been the “reform” of GCSEs. Michael Gove barged through processes which meant that even examining in last year’s GCSE English ended up being a shambles, and had to go for judicial review in the Queen’s Bench Division of the High Court. The teachers, notably the National Union of Teachers, were not consulted about the changes to the GCSE system, a completely ludicrous state of affairs that there are GCSE courses presently in progress.
The “political process” is the third arm of the long-awaited policy review of the UK Labour Party. Whilst millions will have been spent cumulatively on the Scotland referendum, and the AV referendum, and on the introduction of Police Commissioners, there is no doubt that the political process is broken. David Cameron’s talk of holding a referendum in 2017 shows complete contempt that he has disconnected him and his party from major areas of society. The list goes on – disabled citizens are sick of the welfare reforms in progress, with the disastrous introduction of the ‘Personal Independent Payment’ following fast after the pitiful administration of Work Capacity Benefits by the Department of Work and Pensions.
Cameron won’t get as far as holding a referendum in 2017, as he’ll have been shown the door long before then.
The legal case for "the living wage"
It’s actually very bold, and fits in completely with the “One Nation” philosophy of Ed Miliband and Labour. It could even be one of the first Acts to be proposed by a Labour government in 2015/6, and has profound implications.
The “living wage” has a focus on the wage rate that is necessary to provide workers and their families with a basic but acceptable standard of living. It is an hourly rate set independently and updated annually, and calculated according to the basic cost of living in the UK. Employers currently can choose to pay the Living Wage on a voluntary basis; the UK Living Wage is calculated by the Centre for Research in Social Policy, but the London Living Wage is calculated by the Greater London Authority. This minimum standard of living is socially defined (and therefore varies by place and time) and is often explicitly linked to other social goals such as the fulfilment of caring responsibilities.
Uniquely for opposition policies, the Living Wage enjoys cross-party support, with public backing from the Prime Minister and the Leader of the Opposition. That said, the main beneficiary of the living wage is the Treasury, and this is obviously critical for it to be implemented at a time of austerity (but so was the £2bn NHS reorganisation). Financial gains from the living wage will arise from higher income tax payments, higher national insurance contributions and reduced spending on in-work benefits. This has a number of important implications.
On a visit to Islington in north London last year to discuss how Labour councils across Britain have succeeded in implementing the living wage, Ed Miliband described the living wage as an idea “whose time has come”. “The next step is to help more people, including workers in the private sector, have the dignity of earning a living wage. This is one way we can begin building a One Nation economy where prosperity is fairly shared, because it is only by coming together that we can succeed as a country.”
Background
The concept of the “living wage” has roots in various cultural, religious and philiosophical traditions. The modern UK Living Wage Campaign was launched by members of London Citizens in 2001. The founders were parents in the East End of London, who wanted to remain in work, but found that despite working two minimum wage jobs they were struggling to make ends meet and were left with no time for family and community life. In 2005, following a series of successful Living Wage campaigns and growing interest from employers, the Greater London Authority established the Living Wage Unit to calculate the London Living Wage. The Living Wage campaign has since grown into a “national movement”, and Ed Miliband has often talked about how he wishes Labour to be seen as a movement and not just a political party. Local campaigns began emerging across the UK offering the opportunity to involve many more employers and lift many more thousands of families out of working poverty. In 2008 the Centre for Research in Social Policy funded by the Joseph Rowntree Foundation began calculating a UK wide Minimum Income Standard (MIS) figure. In 2011 Citizens UK brought together grass roots campaigners and leading employers from across the UK, working closely with colleagues on the Scottish Living Wage Campaign inparticular, to agree a standard model, for setting the UK Living Wage outside of London. At the same time, following consultation with campaigners, employers who support the Living Wage and HR specialists, Citizens UK launched the Living Wage Foundation and Living Wage Employer mark. Since 2001 the campaign has impacted over 45,000 employees and put over £210 million into the pockets of some of the lowest paid workers in the UK.
The rationale for the living wage clearly merits scrutiny. It has much popular support, and thus, as far as Labour and the Unions are concerned, consitute a clear “vote winner”. In a recent article in the Telegraph, a newspaper not known for its significant Labour sympathies, Jeremy Warner described that, “the potential negatives from such a policy are almost too numerous to list – surging inflation, higher immigration, rising unemployment, a growing black economy, and so on. These alone might appear to kill the idea stone dead. Yet all these adverse consequences could quite easily be countered, and it is a fact that the great bulk of internationally competitive business in Britain already pays living wages. It is in the low-skilled, service areas of the economy that the problem largely lies.” Interestingly, Heller Clain (2007) (J Labor Res (2008) 29:205–218) had previously argued that living wage legislation produces statistically significant differences in poverty outcomes (but that minimum wage legislation does not), with empirical evidence, and provided a clear argument concerning costs and demand how this is most likely to have arisen.
“Beyond the bottom line: the challenges and opportunities of a living wage” (IPPR)
A critical development has been the publication of “Beyond the bottom line: The challenges and opportunities of a living wage” by the IPPR, authors Matthew Pennycook and Kate Lawton (20 January 2013). This provided much detail, with The Living Wage Foundation having already established three critical functions of theirs. It offers accreditation to employers that pay the living wage, or those committed to an agreed timetable of implementation, by awarding the ‘Living Wage Employer’ mark. It also provides advice and support to employers implementing the Living Wage including best practice guides; case studies from leading employers; model procurement frameworks; access to specialist legal and HR advice. Finally, it provides a forum for leading employers to publicly back the Living Wage. We work with Principal Partners who bring financial and strategic support to the work.
Does it need an Act of parliament?
The National Minimum Wage Act 1998 created a minimum wage across the United Kingdom. It was a flagship policy of the Labour Party in the UK during its 1997 election campaign, and is still pronounced today in Labour Party circulars as an outstanding gain for ‘at least 1.5 million people’. The policy was opposed by the Conservative party at the time of implementation, who argued that it would create extra costs for businesses and would cause unemployment. The Conservative party’s current leader (and Prime Minister), David Cameron, said at the time that the minimum wage “would send unemployment straight back up”. However, in 2005, Cameron stated that “I think the minimum wage has been a success, yes. It turned out much better than many people expected, including the CBI.” It is now Conservative Party policy to support the minimum wage.
Indeed, “the living wage” has some prominent supporters.
The IPPR indeed argue that are clear reasons not to legislate for a statutory living wage including the fact that the living wage should not be seen as a replacement for the minimum wage. It there is argued that the minimum wage is based on an empirical judgment about employment effects and is agreed through a social partnership model, allowing a mandatory, statutory approach. However, the living wage reflects standards of living and prices and does not take account of employment effects. Advancing the living wage therefore requires an incremental approach, which can also bring wider benefits by mobilising low-paid workers who lack traditional forms of representation. The question for policymakers is the extent to which the state can support a campaign rooted in civil society.
The IPPR instead recommended that government amends the UK corporate governance code to require listed companies to publish the proportion and number of their staff paid below the living wage, and legislate for this if necessary. This indeed is a very sensible idea, if Ed Miliband and Labour include it as part of a raft of measures in corporate governance which could encourage ‘responsible capitalism’, which thus far has been lacking regulatory teeth. It’s possible that “the living wage” is in fact a practical mechanism of delivering “predistribution“, the thesis articulated elegantly by Professor Joseph Hacker but which people dare not mention in polite public. As part of Labour’s policy review, the party is considering ways to make the rate, which is more than £1 higher than the legal adult minimum wage, the new norm. Listed companies who do not pay the living wage could be “named and shamed” through new corporate governance proposals, and Whitehall contracts could be limited to firms that pay their workers at the new hourly rate. This would be entirely in keeping of the description of a “moral economy” advanced by Jon Cruddas discussing rebuilding Britain, a “new Jerusalem“: “Markets require reciprocity for efficiency and productivity. Together they establish trust, relationships and a sense of stewardship at the heart of transactions. It is a moral economy that can be expressed through co-operative and mutual forms of ownership, and internalised in the culture of business through employee involvement in the governance of firms. In return for their commitment to the company, employees can have a voice on salary levels, improving productivity and business strategy.”
There are though, some might say, good reasons why living wage legislation should enter the statute books in some form, corresponding to the passing of any laws in our jurisdiction. These are namely to protect an individual from harm including employment exploitation, to contribute towards a framework of the rules needed for a society to live and work together, to ensure an enforceable mechanism through which justice can been served, to “punish” people as necessary, and to maintain social order (such as prevention of poverty). It is obviously important that any laws we introduce are not incompatible with European laws, and the current indications are that the “minimum wage is (not) always incompatible with EU procurement rules. There are however obligations to treat all bidders equally, fairly and transparently and in a non-discriminatory way in any procurement process.” Specifically, the European Commission has provided clarification on the issue in 2009, stating that living wage conditions “must concern only the employees involved in the execution of the relevant contract, and may not be extended to the other employees of the contractor”. However, this perspective is to treat law as an administrative process, free from social values and judgments, as discussed by LJ Laws for example in the context of human rights. By enacting a formal law on the living wage could be a strong signal that the law is not merely an error-corrective mechanism for market values, what Prof Michael Sandel at Harvard calls ‘markets mitigating governance’ as a technocratic process done through cost benefit analyses, but that the law is in fact designed ‘for the public good’, encouraging citizenship, civic values and solidarity. Sandel conceptualises this striving for the public good as a necessary reaction to the approaches of Thatcher, Reagan and indeed New Labour, which had generated a sense of ‘market triumphalism’, but points out readily that under such administrations this had had a destructive effect on rich and poor people living further apart in society. This indeed can be easily seen in the UK with the rich becoming even richer.
One Nation Economy
Trade unions are still a significant part of the culture of UK, not least because they serve to protect workers and employees against scrupulous employers. In the trade union movement, UNISON has had noteworthy success in offering practical advice about how citizens can “win the winning wage”. Ed Miliband has made it no secret that he does not wish to see a divide between ‘private sector’ and ‘public sector’, in that we all contribute to one unitary UK economy. This has been reflected in how Miliband has provided hints about trying to make trade unions also relevant to the public sector. Encouraging a ‘living wage’ could be a way of getting more people involved in the Union movement, which Miliband has openly warned should not be seen as the “evil uncle” of Labour. The IPPR report indeed cites: “The greatest successes in securing the living wage have been made through bottom-up processes of organising and campaigning. These processes have sought to involve low-paid workers directly in the struggle to improve their own wages, as well as building broader alliances with a diverse mix of unions, faith organisations and community groups.”
As the forerunner to a ‘one nation economy’, local and regional initiatives have consolidated a number of improvements in pay for nearly 45,000 low-paid workers. In addition to the nine local authorities that have been formally accredited as living wage employers, a growing number of private sector employers have introduced living wage agreements including Barclays, KPMG, Deloitte, Linklaters and Lloyd’s of London. More widely, living wage initiatives have reshaped social norms around wages and in-work poverty and have refocused attention on the role that decent pay above the national minimum can play in raising living standards, alongside remedial redistribution through tax credits and in-work benefits. This, alongside the fact that a national minimum wage has already been acted in the UK, is significant when noted with an observation from Heller Clain 2012 (Atl Econ J (2012) 40:315–327) about how experiences of implementation of the “living wage” in the US: “Ceteris paribus, the strength of the community sentiment in support of living wage legislation may be lessened, where the state government has already adopted policies aimed at raising the incomes of the working poor. For example, there may be less motivation to enact living wage legislation where the state has already enacted a statewide minimum wage higher than the federal level.”
There are clear benefits which have been experienced by adopters of “the living wage”. An independent study of the business benefits of implementing a Living Wage policy in London found that more than 80% of employers believe that the Living Wage had enhanced the quality of the work of their staff, while absenteeism had fallen by approximately 25%. A major economic rationale is that paying UK workers a “living wage” would save the Treasury more than £2bn a year by boosting income tax receipts and reducing welfare spending, according to a joint research by the Resolution Foundation and the Institute for Public Policy Research. They found gross earnings would rise by £6.5bn if employees were paid a living wage – an estimate, above the statutory minimum hourly rate, of what workers must earn to meet basic needs. There is, additionally, a much wider elegant narrative at play here. It has been recognised by anyone other than George Osborne and his colleagues that ‘underconsumption’ has been a major factor in why the UK economy has been failing latterly (parallel with decreased levels of tax receipts, even predating the current financial crash). Indeed, starting with Malthus and Ricardo in the nineteenth century, economists had long debated the viability of ‘underconsumption’ as a cause of cyclical depressions. This is now recognised in the economic press, for example “the increasing attention to consumer demand among businessmen merged with a related trend in economics: the rise of institutional economics … A key element, though, was the conviction that economists needed detailed, quantitative, empirical studies of consumer behavior (sic) and existing markets, encompassing everything from focused psychological or sociological analyses to expansive, aggregative surveys of household income, prices, and family expenditures.” (Stapleford, Labor History, Vol. 49, No. 1, February 2008, 1–22)
The IPPR are mindful that many small and medium-sized firms are likely to struggle with the costs of implementing the living wage if a significant proportion of their staff are low paid. They recommend the government should explore using the architecture of City Deals to create ‘living wage city deals’, drawing forward future tax and benefit savings from paying local government workers the living wage and devolving this money to support private sector businesses in transitioning to the living wage. So far, two thirds of employers reported a significant impact on recruitment and retention within their organisation. 70% of employers felt that the Living Wage had increased consumer awareness of their organisation’s commitment to be an ethical employer.
One Nation Society
It’s clear that the arguments for “the living wage” are not just economic, as discussed above, but also are profoundly relevant to a sense of soldiarity and “civic duty” inherent in a “one nation society”, Living wage initiatives grounded in forms of community organising seek to increase the bargaining power of workers who lack access to more traditional forms of representation such as through trade union structures. It furthermore can easily be argued that, beyond their ability to lift wages and living standards, living wage initiatives have the potential to empower low-paid workers, many of whom lack voice and power in the workplace and in wider society. Many living wage initiatives, both in the US and UK, have sought to mobilise low earners directly rather than campaigning on their behalf, by organising workers and communities through a process described as ‘community organising’ or ‘community unionism’. Indeed, here in the UK, the Living Wage campaign was launched in 2001 by parents in East London, who were frustrated that working two minimum wage jobs left no time for family life. The causes of poverty are complex and in order to improve lives there should be a package of solutions across policy areas. The Living Wage can be part of the solution. Over 45,000 families have been lifted out of working poverty as a direct result of the Living Wage.
This is fundamentally a point to do with “cohesion” of our society. It has been patently obvious that New Labour failed monumentally on “inequality”. in its quest for market triumphalism, described above. There is a sense of Ed Miliband ‘righting a wrong’ here, in addressing the societal problem of inequality, and if Miliband can achieve this he will have succeeded in a crucial area where Blair had failed.
Conclusion
Boris Johnson appears superficially laid the groundwork for “the living wage” in London, but credit that the overall Conservative-led admininstration has led the way on employment justice can only massively dampened for a number of diverse reasons. The cross-party support is described above, but it is conceded that, in the US, “a larger population and greater local support for Democratic presidential candidates are significantly linked to a greater likelihood of adopting living wage legislation and a greater speed in adopting living wage legislation.” (Heller Clain, 2012) And yet, the “living wage” may not be necessarily partisan, although one has no idea what the Liberal Democrats wish to advance following June 2015, and would nicely fit into the framework which Ed Miliband has already provided. I expect it will be a major, if not the, major campaigning issue for Labour in 2015, and could be one of the first things an incoming Labour government would legislate for in some form. The monumental research of IPPR, the Living Wage Foundation, numerous corporates and the trade unions will have contributed greatly to the success of this initiative, as will have Ed Miliband of course.
A coalition with the LibDems would stink, but Clegg's motives are nakedly clear
I know it’s all about not shutting any doors, and keeping all options open. However, much as I like Neal Lawson personally and the whole of Compass, especially Gavin Hayes, I think the best way to save the “progressive left” is to vote Labour at the general election of 2015.
Why do I bring this up now? Nick Clegg said he could imagine working with Labour after 2015, and Ed Miliband has said politely, “it would be difficult”. This is the equivalent of a boy saying, “Do you fancy us going to Claridges’ tomorrow evening?”, and the girl saying, “Not really, you stink”.
It would be impossible for us to work with Nick Clegg or the Liberal Democrats. While Clegg can use empty words such as “duty” and “national interest”, actually his proposition is deeply offensive. It’s deeply offensive to those innocent people who objected to his party enacting the privatisation of the NHS. It’s deeply offensive to those disabled citizens who hate the new disability benefit legislation. It’s deeply offensive to those with housing or other social welfare problems who are seeing a swathe of free law centres and citizens advice bureaux shut down.
The Liberal Democrats are now in self-destruct mode, en route to commit a full political apoptosis on May 8th 2015. They will be utterly obliterated from English politics. Do you think that Nick Clegg is lending an olive branch to Labour members? No, Nick Clegg hates Labour and the Unions. He is sending out a message that a vote for the Liberal Democrats is a vote for Labour.
Ed Miliband must reject this at all costs. We do not need a sympathy vote from Nick Clegg or his party. His MPs enacted three of the most destructive laws, without involvement of the people concerned, in my lifetime. He is hoping that Social Liberal Democrats won’t bother voting at all, and his Orange Liberal Democrats will provide “one last heave” to get David Cameron winning his first ever general election.
Nick Clegg’s message is politically odious. He never explained why the deficit had increased due to spend on the hospitals or schools, nor why a desperate measure was needed to save the banks. I would say, “If he wins Sheffield, I’m a baboon”, but unfortunately he has a very safe seat which would be impossible for Labour to win.
Privatising the blood bank and NHS, G4s and A4e fiascos.. ENOUGH!
This has got to be the most putrid, sick, incompetent Government. Thanks also to the LibDems for selling the NHS down the river, at the expense of Lords reform which they never got.
bwah bwah bwah
