Britain - Blair's 150 days in office

Oct/Nov 1997

By the time this year's Labour party conference is over, Blair will have completed his first 150 days in government.

As this journal goes to press, just as the conference begins, an unprecedented number of motions hostile to various aspects of Blair's policy have been submitted by local organisations. Such a flow of criticisms certainly shows that Blair's honeymoon period must be over for a large number of Labour activists.

Whether delegates are actually allowed to exercise their very limited right to express their discontent on the policies carried out, or announced since Blair came into government, remains to be seen. But if so, it could well be for the last time.

One of the high points of this conference will indeed be a vote on Blair's proposed reform of the party's internal regime - outlined in a document with the evocative title "Partnership into power" - which is aimed precisely at preventing any future uncontrolled expression of discontent within the party.

Among other things, this reform will reduce drastically the time allocated to debates during the conference, while ensuring that the choice of which resolutions are allowed to go in front of delegates will pass entirely under the leadership's control. Moreover the composition of the party's National Executive will change. Twelve members will represent the unions, three will be chosen by Blair himself among his ministers, three will be nominated by the association of Labour councillors and six will be elected directly by postal ballot - but no MP will be allowed to stand in this ballot, thereby eliminating popular left figures like Benn and Skinner. The grip of the party and union machineries over the NEC will therefore be strengthened at the expense of conference delegates and local branches.

Predictably this plan has infuriated many party activists, resulting in over a hundred motions against it. Yet, despite this opposition, Blair's reform looks set to be adopted thanks to the support of the union machineries - which Blair must have consulted before releasing his final proposals.

This reform will further disenfranchise Labour activists in their own party and their anger is therefore understandable. On the other hand, this will change very little as to their actual influence on the policy of their own leadership, let alone of the government itself. After all, in the past, no amount of democratic debate, either at constituency or conference levels, has ever prevented the Labour leadership from carrying out policies which went blatantly against the aspirations and the interests of the membership.

Once again Blair shows that he is not prepared to take the slightest risk of allowing any form of opposition to express itself publicly from within Labour's ranks. At the same time, the confrontation which is bound to take place at the conference over this reform, will allow him to make another high-profile demonstration of his ability to discipline his party, thus boosting his credit among his high-flying friends in business on the one hand, and driving home his no-hope message to working people on the other.

By now in any case, those Labour activists and voters who, yesterday, wanted to cling to the illusion that Blair had some sort of left-leaning "hidden agenda" up his sleeve have certainly forgotten all about it. And today the RMT leader Jimmy Knapp would make a laughing stock of himself if he was to repeat the grandiose - and hypocritical - speech he made at the London May Day Festival just four days after the election, to the effect that the Tories' anti-union laws would soon be dismantled by the "magnificent" new Labour majority in the Commons.

What change?

Instead of this "hidden agenda", what we are witnessing now is a glaring absence of change, just as if no general election and no majority change in Westminster had taken place.

Brown's July interim budget was a striking example of this. His first move as Chancellor was to make a "nice" gesture to business, just as any new Tory Chancellor would have done previously - cutting corporation tax by 2 points, down to 31% for large companies and 21% for small and medium ones. Only, to make it even more worthwhile for the bosses, Brown made sure that the cut would be backdated to April. In fact Brown went even further in putting on the cloak of a Tory Chancellor - with a formal commitment to stick to the spending targets set by former Tory Chancellor Clarke until 1999. So much so for all those who voted Labour as a way of voting against the Tories' austerity.

Of course, there was something more unusual in Brown's budget - the windfall tax on privatised companies and the phasing out of tax credit on dividends, which both amount to taking back a (small) share of the enormous profits earned by privatised companies and pension funds thanks to previous governments' handouts.

But windfall taxes have been used by the Tories too, in the 80s, when they needed cash urgently. Brown's windfall tax amounts to a total £5.2bn to be paid over the next two years by 28 companies. Compared to the privatised companies' enormous profits, thanks to the cuts in jobs and services and the price increases which they were allowed to implement by the past governments, this is a pittance (on their own the gas, electricity and water utilities made over £70bn profit up to this year!). And it is a mere drop compared to the ocean of gains made by the shareholders of these companies, thanks to the bargain-basement prices at which they were sold at the time of privatisation. Yet there has never been any question of Brown imposing a windfall tax on these shareholders!

Significantly, the privatised companies themselves made very little fuss over this windfall tax. Of course, they have had plenty of time to prepare themselves for it and shield their shareholders in advance against possible consequences to dividends. But in addition, judging by the statements made for instance by British Telecom and some of the US companies which have bought into electricity generation, they were obviously quite relieved at what they welcomed as a low figure. The honeymoon between Labour and business was not even interrupted for one second by Brown's budget.

Since then, hardly any new tangible moves have been made by the government. There has been a lot of hot air about "radical" plans, with each one of Blair's ministers featuring in turn on the papers' frontpages due to some more or less outrageous remark, leaked document, or supposed intentions. All this was certainly calculated and carefully planned by Labour's PR machine, if only to sustain the image of a dynamic and innovative government.

Despite the official ending of the NHS internal market and the promise of £1.2bn extra-spending on hospitals, patients are treated as commodities, just as before. Nor does the extra £2.3bn allocated to education prevent school teachers and pupils from being confronted with the same dramatic cash problems and the same barrage of testing, league tables and "education hit squads", as before. Yet, in education, Blair did make a move on one issue at least - the introduction of £1,000 tuition fees for university students from 1998, something which the Tories had considered many times in the past but never dared to introduce.

In local authorities, Compulsory Competitive Tendering has been officially terminated. But it will have a replacement and in the meantime no-longer-compulsory Competitive Tendering is taking its toll on jobs and conditions just as before May 1st. Likewise many of the previously planned backdoor privatisations, such as the sale of DSS properties, are going ahead. The privatisation of the Post Office has been halted, but not that of Quadrant, the PO's catering arm, and the London Underground seems increasingly likely for an early privatisation. Meanwhile, more private finance is being invited to "contribute" to the public sector, in accordance with the Tories' Private Finance Initiative - that is to make profits at the expense of public services.

Overall, the main feature of the past five months has been the continuation of just about every single one of the Tories' policies, almost without any alterations.

Behind Blair's devolution "victory"

Some would argue that, at least, things have been moving in Scotland and Wales, where the success of the devolution referendums was hailed as Blair's personal victory and a "revolution" in British history.

That this success boosted Blair's credit in public opinion, is probably true. Although this is not so much due to the enthusiastic support of the electorate - which was not all that enthusiastic - than to the media campaign which stressed Blair's "boldness" in taking the "risk" of a defeat similar to that of the last Labour government in similar referendums, back in March 1979. Never mind the fact that the "risk" this time was far from being comparable, let alone the context.

As to the Scottish and Welsh devolution being a "revolution", this may be true for those who see society only through the distorted forms of its political institutions. But whether this "revolution" signals a significant change, let alone the prospect of better conditions, for the majority of the Scottish and Welsh populations - very unlikely!

Judging by the referendum results Scottish voters were not all that convinced. Given the low 6O% turnout, no more than 44.4% of all registered voters supported the setting up of a Scottish parliament and 37.8% agreed that it should have tax varying powers. And in Glasgow, by far the largest urban and working class concentration in Scotland, the turnout was as low as 51.2%.

In Wales, the vote was even narrower, with just 50% turning out to vote and an overall 25.15% of all registered voters supporting the setting up of a Welsh parliament. Ironically, Cardiff, where the future Welsh parliament is supposed to be located, voted against it!

Yet, the line-up in favour of devolution looked overwhelming in both cases. The "Yes" campaign brought together just about every political current, from the nationalists to most of the Left, but with the notable exception of the Tories, who have no MPs left in either region and called for a "No" vote.

The pro-devolution campaigners built heavily on the general discontent over the state of society - the poor standard of housing, low prospect of employment, dire state of public transport and health provision, etc.. They reminded voters of the 18 years of Tory rule in Westminster, during which, despite consistently giving a majority against the Tories in every general election, both Scotland and Wales had to endure the same Tory austerity measures that were enforced everywhere else in the country. Ultimately, their main argument was that local people would be better off if they were allowed a say in all these matters.

Except, of course, that devolution is not about giving local people a say in the way things are run. It is only about giving some say to a bunch of politicians sitting in Edinburgh and Cardiff and well- paid jobs to hundreds of local professionals in the future devolved administration.

But will these politicians, who will be elected for a four-year term in 1999, be any more accountable than those at Westminster as the pro-devolutionists have argued? Indeed, will they be more accountable than the politicians who run large urban local councils like Glasgow or Cardiff? Hardly likely. Yet the impeccable Scottish or Welsh credentials of these local councillors did not stop them from carrying out cuts and austerity measures left, right and centre, just like their colleagues in the main towns of England!

On the other hand, it is not hard to see what calculation a government bent on cutting public expenditure like Blair's may be making in granting devolved powers to Scotland and Wales. After all, due to their dire social situations, these two regions absorb more public funds per head than England and they also still have proportionally more hospital beds and more council houses. Aren't they likely to be privileged targets for Brown and his army of expenditure-slashers? And what better cover is there for doing this, than the possibility of blaming the resulting difficulties of working people in Scotland and Wales on the mismanagement, the corruption or the ruthlessness of a devolved parliament?

These were exactly Thatcher's tactics when she started putting pressure on the large local councils to implement the cuts in social expenditure which she had decided. The odds are that Blair will use the same tactics again, but with Scotland and Wales this time.

Threatening plans

If the period since the general election seems strikingly uneventful in most respects, it is also looking increasingly like a lull before the storm, judging by the many plans currently being announced. And what this storm seems to have in store for working people is a series of attacks on their conditions, which smacks of the so- called "radicalism" that Thatcher used to boast about so much.

Blair's election promise to the capitalists that he would radically reform the welfare system is now beginning to take shape. The statements made by Brown about his plans for the next budget, in the run-up to the Labour conference, provides many clues as to what the Labour government is aiming at.

Tory ministers used to blame unemployment on the fact that the unemployed are lazy, that they make themselves unemployable in order to have an easy life. Labour's line is slightly different - although it really amounts to the same contemptuous attitude to workers and the same determination to shift the blame away from the bosses' on-going job-cutting exercises. They say that unemployment is caused by the way the benefit system works, that it is too much biased in favour of the unemployed and not enough in favour of the low-paid. Therefore Brown intends to introduce tax credits, which will replace and generalise in-work benefits.

In content, this approach, which Labour has borrowed from the notoriously unfair welfare system of the USA, is not actually very different from that of the Tories - or of the postwar Labour government for that matter. The Tories kept arguing that the way to boost job creation was to reduce wages and focus benefits on those most in need. Brown, just like the postwar Labour government, argues that the best way to get the unemployed back into work is to give them a top-up, thereby encouraging them to take very low-paid jobs. Either way, this means that the role of the state is to encourage and subsidise low wages.

What will happen to benefits currently received by those who are without a job, remains an open question. The only certainty is that Brown intends to reduce substantially his Social Security budget next year, which can only mean that he intends to cut benefits accordingly.

Having denounced for years the way in which the previous governments fiddled unemployment figures, and having promised in June to introduce a new and more accurate measure of it, the government seems now quite happy to use the old fiddled indicators to back up its plans. So, since the official figure for the under-25s unemployed for six months and more is now below the 250,000 barrier, Labour's plan to subsidise 250,000 six-month jobs for these unemployed is said to resolve the problem. Never mind the fact that the £60/w subsidy offered will not create one single new real job and that, once the six-month period is over, the trainee will be back to square one. As to those young unemployed who are not accounted for by the official figures, because their benefit has been taken away under JSA regulations for instance, they simply do not exist for Brown, at least not in his "radical" plans.

Brown also has a magic wand, which he claims will put a lot of those currently on benefit into work - namely single mothers, the disabled and the long-term sick. This magic wand is called "counselling". Thus, in the case of the one million single mothers living (or rather barely surviving) on income support, they are to be offered counselling by benefit agencies to help them to find a job. Whether there are one million jobs available for them is not considered an issue. The point is to expose these single mothers for not doing quite enough to get out of the welfare net and to put pressure on them with this counselling and the implied threat that their already reduced benefit might be cut. The irony is that, at the very same time as these plans are to be implemented, the existing vastly insufficient nursery system is going through a large-scale crisis with hundreds of nursery schools in working class areas being closed or threatened with closure due to shortage of funds!

This mixture of moralism, threat and hypocritical optimism is simply not serious - certainly not if the aim is to fight unemployment as Brown claims. There is no way Brown can expect a sizeable section of these unemployed workers to get back into regular work in the present context, and he knows it full well. But his problem is not that - it is to cut the government's Social Security bill. Just as JSA has been a means for the Tories (and now for Labour) to cut the benefit bill by pressuring people off the dole register, his welfare-to-work drive by way of "counselling" is just a "softer" (for the time being at least) way of doing the same with single mothers, the disabled and the long-term sick.

The dangers ahead

Beyond the rhetoric, Blair's "welfare revolution" is therefore just the continuation and expansion of the old Tory policy of cutting state social expenditure while attempting to force the unemployed into the claws of the exploiters and into low-paid jobs.

Of course, Blair's promise of a minimum wage, on which many Labour voters had been building hopes in the run-up to the general election, should, in theory, be a protection for the working class. But will it?

To begin with, it may be a protection for full-time workers, but certainly not for part-timers since it is not a minimum earning level, but a minimum hourly rate.

But even for full-time workers, there are more and more reasons to suspect the reality of this protection. A letter by Margaret Beckett to the Low Pay Commission - which is supposed to define the level of the minimum wage and the conditions under which it will be enforced - was leaked on 23 September to The Times. In this letter Beckett explicitly recommends "lower rates or exemption" for workers under 25. Another letter to the Commission, leaked to the same newspaper, but this time by the head of one of the country's big retail groups, stresses that a level above £3/hr would be "intolerable".

If these recommendations are implemented when the minimum wage is introduced, around the end of 1999 - and there is every reason to think they will be, since Blair is adamant that his government will put no pressure on employers to agree to a minimum wage that they do not find "affordable" - then there will be no protection against low wages for a large section of young workers, and only a minimal one for all the others. In fact, the levels mentioned are even lower in real terms than those which used to be enforced by the wage councils disbanded by the Tories in the 80s.

Labour's combination of a very low minimum wage and shrinking benefits is a dangerous recipe for the working class. Were the economic situation to worsen again, like in the early 80s or early 90s, it could result in an even larger section of the working class being caught in the trap of unemployment, but this time without the safety net of the benefit system, forced to go for any kind of job under any kind of conditions. It is for this kind of future that Labour's "compassionate" plans could pave the way - and this is why they must be resisted.