Britain - On the frontline of the class struggle

Sep/Oct 2003

For the past 12 months, the political scene has been dominated, first by Blair's warmongering, and then by his invasion and occupation of Iraq. But meanwhile, behind the scenes quite another sort of war has been going on here in Britain - one waged against working class people by the same greedy capitalists who expect to gain from Blair's imperialist venture in Iraq. While Blair was shedding the blood of the Iraqi people and imposing on them the diktats of British capital, thereby squandering public funds and lining the pockets of arms manufacturers, here at home, bosses were busy squeezing as much profit out of the British working class as they could.

The government leads the way...

Over the past year a growing wave of job cuts has affected, once again, all sections of workers. And in this, the government itself has been giving the lead. Even if it does hide behind so-called "public limited companies" as in the case of the Post Office/Royal Mail or Network Rail, (which are, in fact, 100% state-owned), or behind various forms of "public-private partnership" and outsourced contracts, where private profits are usually dependent on job cuts.

It was this government, as the only shareholder in the Postal service, which gave the green light to the 30-40,000 job cuts announced at the end of 2001. Already by May this year, Royal Mail had cut 16,500 jobs via redundancy and non-replacement of retirees. It had also laid out its final plans to cut 12,000 outdoor delivery jobs over the next two years pending ratification of a productivity agreement with the postal union, the CWU. In addition, 2,000 sorting jobs are due to be cut at London's Mount Pleasant sorting office, once the much delayed international mail centre at Langley is fully operational.

Royal Mail's switch of mail distribution from rail to road and air (despite the fact this is quite contrary to the "green" image the government is peddling) began in July and will be completed in January 2004. It means the end of 18 Travelling Post Offices, with an additional 500 postal job cuts, plus another 517 mainly train driving jobs lost in English Welsh and Scottish Railway.

In the railways, Network Rail, will be cutting 2,000 jobs over the next 3 years. And although the company has claimed that its very limited take-over of staff from maintenance contractors would offset these job cuts, this is merely a sleight of hand, since the overall numbers working on the tracks will not change.

The government's other favoured method of passing the redundancy buck was adopted seamlessly from the Tories, i.e. by way of outsourcing - which is on-going in the civil service, including in the MoD, which is, for instance, cutting 1,200 IT jobs at Ensleigh Base, where its Defence Logistics Organisation has its HQ - with plans to outsource all its IT work.

More shocking perhaps, given all Blair's rhetoric about making education a priority, is the loss of 5,000 teaching and support staff jobs in secondary schools this year in England alone, due to under-funding of school budgets, resulting in an increase in class sizes.

What the medium and long term effects of the invasion of the NHS by the private sector will be in terms of jobs remains to be seen. But since the government's objective is to cut social expenditure, while the primary aim of the profiteers is to maximise profits by cutting labour costs, redundancies with or without wage cuts are the logical consequence.

While cutting jobs in its own public sector backyard, ministers make no apology for encouraging private bosses to do the same in order to make the best (from the point of view of their profits, of course) of Blair's "flexible labour market." So, for instance, after the scandal caused by the insurance company, the Accident Group, when it sacked its workers by text message last May, DTI minister Patricia Hewitt replied to demands for tighter statutory protection for workers against such actions, by defending companies' right to dismiss staff. She commented: "I don't believe we are going to protect employment by trying to ban redundancies or restructuring. The downside of this is you slow down the process of job creation, as you can see in other countries" - the same worn-out, cynical argument, which has been used by all governments, Tory and Labour, since the early 1980s, as a fig-leaf for the drive to casualise labour!

And the private sector follows with enthusiasm

But then, of course, private companies need no encouragement from the government to pursue their own job cutting drive.

So, according to the engineering and technical union, Amicus, by June this year, 155,000 manufacturing jobs had been lost in the previous 12 months - 13,000/month on average. This is a particularly serious blow for the working class as a whole because, along with these mostly permanent full-time jobs, go the possibilities of accruing seniority and benefits which have allowed generations of workers to experience a certain amount of employment stability and to avoid falling into destitution when they get to retirement age (if they are lucky to live long enough).

However, the redundancies announced this July and August alone (and these are only some of them) give some idea of the scale of the on-going erosion of jobs throughout the private sector - in fact a "renewed wave" of redundancies. In the profitable banking and financial services, jobs continue to be cut. HSBC cut 1,400 jobs in July. Norwich Union, the insurance giant, made 600 administrative workers compulsorily redundant and cut 300 jobs in Norwich itself, the same month. Barclays, top of this financial quarter's banking profit league, had already cut 1,400 jobs earlier. And Sun and Royal Alliance, the 2nd largest insurance company, announced another round of 1,000 job cuts, before even having completed the 5,000 redundancies which had been announced earlier.

The large manufacturing companies are also continuing to cut jobs. In July, Ford announced that it would move the production of the Freelander from its Solihull Landrover plant to Halewood in Liverpool by 2006, with the net loss of 1,500 jobs. Alstom will cut 4,000 jobs by closing down plants producing equipment for power stations. In addition, 1,400 jobs will disappear with the closure of its train-making Washwood Heath plant, in Birmingham, the excuse being a gap in its order book between the completion of its contract to make Pendolino trains for Virgin and the start of a contract for more trains for London Underground. Now Bombardier - the last train-making company in Britain - may be doing the same, threatening 2,800 workers' jobs at its Derby plant, while it shed yet another 1,600 jobs at its Belfast factory (Shorts, part of Bombardier's aircraft division) in July.

Medium and small manufacturing plants are announcing job cuts almost daily. Circatrex electronics plant in South Shields - which employs 650 workers announced that 100 workers would lose their jobs and the rest take a pay cut and shift allowance cut, or the company would have to call in the receiver in 3 months. 100 Adecco Agency workers at the IBM Greenock complex in Scotland were summarily sacked in July. Impress at Norwich (making tins and cans) announced 100 job cuts to "improve competitiveness", even though it is a "market leader". Dyson washing machines announced the closure of its Wiltshire plant with 65 job losses. (Last year 800 jobs went when Dyson vacuum cleaners switched to Malaysia). United Milk in Wiltshire (the biggest milk processing plant in Britain) went into receivership - threatening 125 jobs plus presenting problems for 320 farmers who belong to the United co-op.

Then some big retailers have closed dozens of stores shedding more thousands of jobs. Among them, Powerhouse (which took over the Scottish Power retail chain) has gone into receivership, closing 90 of its 223 outlets, and leaving 813 of its 3000 workers jobless.

The largest of the so-called "new industries" i.e. call centres, which employ in total around 500,000 workers, has decided to start transferring jobs abroad. BT transfers threaten up to 4,000 jobs in the short term. Other companies like the insurance giant Aviva set up a call centre in Bangalore, India, earlier this year to process insurance claims, rather than pay the miserly £11-13,000 annual salary that call centre staff get here. And the tendering out of the National Rail Enquiry Service call centres is more likely than not to result in a similar outcome.

Labour's hidden jobless

Although generating considerable and unnecessary hardship for those concerned, these job cuts could possibly have been absorbed by the economy if there was a large enough number of job vacancies - i.e. if the state of employment in the country really was what the government says it is. But it is not.

Of course, we were told last July that history was being made since there was a record number of "people in jobs" and that the UK was nearer to "full employment" than it had ever been. But like so many of this government's assertions, its employment statistics are plain lies.

The official "employment count" on which all this boasting is based is hardly an accurate measure of the number of "people in jobs." It is supposed to measure the number of people of working age (over 16 years and under state retirement age) who are in work. So it includes unpaid workers in family businesses, those on government training schemes like the New Deal or Jobcentre Plus and the self-employed. But the vast majority are wage earners, who are defined as everyone of working age who has done at least one hour's paid work in the week of reference.

What sort of measure of employment is this? Of course, there are company directors who can afford to make a luxurious living out of sitting for one hour a week in a boardroom, if not less. But for the overwhelming majority, real employment can only mean a full- time job - otherwise how would they make ends meet?

Besides, this "employment count" includes a large number of students who need to work part-time, or even full-time, in order to survive, particularly since Labour introduced tuition fees. Above all, since part-time workers account for around one- third of the workforce and often do several jobs, this "employment count" involves a lot of double or even triple counting.

But even if one does accept this grossly distorted count as a measure of employment, it still leaves us with a huge number of real jobless.

In August the official "employment count" stood at 27.92m or 74.7% of the population of working age. In addition to these officially employed workers were between 1.46m and 1.86m (3.9% to 5%) officially unemployed workers, depending on the measure used. Among these, only 939,200 qualify for unemployment related benefit, before being forced into a government "help find a job" scheme.

In total, therefore, 29.78m people of working age (79.7%) were officially either employed or unemployed, leaving 7.6m people of working age (20.3%) unaccounted for and suspended in mid-air.

Among those who are unaccounted for are probably a number of people who can afford to making a living without doing any paid work. But these can only be a small minority. The overwhelming majority is simply excluded from the official unemployment total under various pretexts. There are those who have been put on special benefits, due to some incapacity or disability but also, often, due to their being too old to find a job; there are those who have given up looking for a job, particularly in areas which have become industrial wastelands, and those who refuse to claim any kind of benefit, given the increasingly coercive and punitive conditions which are imposed on claimants.

Official statistics categorise all these workers as "economically inactive" rather than jobless. But most of these millions of workers would work if there were suitable jobs available. For all of Blair's claims about having generated jobs through the casualisation of labour, the fact is that this hidden unemployment has remained more or less constant since the recession of the early 1990s and throughout Blair's period in office: the "inactive" count has remained virtually the same during that period and the small year-on-year variations were mostly due to career moves among the better-offs rather than the jobless finding jobs. Or to put it another way, the "inactive" jobless only left this category when they qualified for a state pension. And when they did, they were replaced by a similar number of workers who had lost their jobs.

In other words the official statistics exclude most of the jobless from the unemployment count while considering millions of workers doing casual jobs, out of which no-one can possibly make a living, as being employed! In this context, when decent, full- time and permanent jobs are virtually impossible to find, particularly for the non-skilled, the current wave of job cuts spells catastrophe for those "redundant" workers who are at the receiving end of the companies' profit drive.

Aiming at workers' pockets

It is impossible from government statistics to assess accurately the changes in the standard of living of the working class. But the general relative fall in wages with respect to the cost of living can be illustrated by the case of local government workers who, according to a survey published by the Labour Research Department last year, earned less as a proportion of average earnings than during the Winter of Discontent in 1979.

Even more significantly, the extent of poverty has remained virtually unchanged despite Blair's high-profile "crusades" and welfare reforms allegedly designed to end poverty. The official poverty threshold for "low income" is 60% of median income. In 2000/1, 13m people were living on incomes below this threshold. The drop of one million since 1996/7 in this figure, only means that this one million, due to tax credits, get around £2-£3 more per week than before. Which can hardly be considered as removing them from the poverty wage bracket - except of course, by statisticians and Labour politicians.

One measure which, according to Blair, was supposed to end the poverty generated by low pay was the minimum wage. Except that after having been set at a very low level, it has dragged far behind prices ever since. Today, 1.2m workers nationally receive the minimum wage (£4.20/hr). At this level, those working full- time earn just about half of the average manual wage - which is not only below the poverty threshold but also a starvation wage. As to those who work less than full time, they just cannot scrape a living.

An indication of the shrinking standard of living of the working population is provided by the sharp rise of its indebtedness. The Citizens Advice Bureau - whose clients are mostly from the poorest section of the working class - estimates that the average debt owed by their clients is £10,700 - more than 13 times their average monthly income. There has been a more than 47% rise in new debt problems over the past 5 years. It is facts like these which show the real picture - an even deeper slide into poverty amongst the poorest.

More generally, accountancy firm KPMG reported this August that 24% of people are using credit cards and loans to pay household bills and meet day to day living costs. Over half owed up to £10,000 but 15% owed much more. 84% said they hoped to pay off the debts they were accruing in five years, with 22% saying they would work overtime to do so - the only way for most workers to increase their income, since pay rises are so few and far between. And these figures do not even include mortgage debts which have been rocketing lately, partly because working class families seized the opportunity of the housing price boom to remortgage their homes in order to pay other debts. One way or another, they get more and more deeply into debt, with the additional risk of repossession should the housing market collapse.

Given the scandal precipitated by the mushrooming of loan sharks and pawn brokers preying on those in debt, over the past few years, the government decided to intervene. So it now licences "respectable" pawnbrokers who can quite legally charge the enormous interest rate of 5%-7% per month for six months, after which they expect the loan on a pawned item to be paid back in full or they sell it off. It must be said, however, that the biggest loan sharks of all, in terms of turnover, remain all respectable banks and supermarket chains, which charge extortionate interest rates on their credit cards - which, very often, are the only means for working class families to hold on until the next pay packet comes in.

Nor are workers' retirement days in any way protected. Attacks against pensions, which started over the past two years with the closure of many final salary occupational pension funds, are carrying on. And in this respect as in others, Blair's government is leading the way. It has already proposed that the civil service retirement age be increased to 65years. Moreover, while organising a "consultation" aimed at producing a code of conduct guaranteeing the transparency and accountability of occupational pensions, the government plans to take £190m out of the Miners' Pension Scheme, despite its £390m deficit. The pretext for this is an agreement passed in 1994 between the fund trustees and Major's Tory government, as part of the privatisation settlement, at a time when no-one even envisaged the possibility of a collapse of the stock market. Altogether, since 1997, the Labour government will have grabbed £1.3bn of so-called "surplus" out of the combined Staff Superannuation and Miners' pension schemes!

The union bureaucracy and the bosses' attacks

The union leadership's response to the bosses' current profit drive can be illustrated by one example among many others.

In July, when Peugeot Ryton management announced that it would "have" to cut 700 jobs (the whole weekend shift) because the new model 206 would not be built at the plant after all, the T&G and Amicus union leaders did not even hint at the possibility of the workforce challenging the company's diktat. Instead they negotiated the right for them to "choose" between either accepting this cut in jobs or taking a cut in hours which would allow the company the savings on its wage bill which it insisted on. The union leaders now claim to have "saved 700 jobs", and the whole workforce is working fewer hours - but in effect taking a wage cut of 3% for weekday workers and 20% for weekend workers.

This example is replicated at other plants like Impress in Norwich where workers had a similar deal "negotiated" by the union officials last December - but six months later faced 100 job cuts anyway.

In the name of their "partnership" with the bosses, union leaders have been bending over backwards to help them find some sort of arrangement which would allow companies to make the savings their were aiming at on their wage bills while allowing the unions to claim they had won concessions from the bosses, no matter how mean. Whichever form such arrangements take, the workers always lose out when it is not on the basis of a balance of forces which is favourable to them - something that cannot be built in committee meetings, but only on the shopfloor by taking action.

It is this policy which has discredited the trade unions among sections of workers who have been at the receiving end of their "partnerships." So much so, that according to a recent report commissioned by the TUC, despite the larger number of workplaces where they are recognised, they have been losing members, as redundant workers fail to rejoin, while young workers haven't replaced them, probably because they did not see any point in joining.

But never mind that. What matters to the union leadership is to impress on the bosses their usefulness as business partners, whatever the cost for the workforce. And to this end, it is vital that they should prove willing and able to avoid any industrial unrest.

This is why almost the only cases where there have been moves, even if only symbolic ones, towards official industrial action have been when unions leaders felt they might be "bypassed" by the bosses.

It is precisely this which has put the postal workers' leaders' noses out of joint recently - when CEO, Alan Leighton, "bypassed" their good offices and wrote to workers this July offering a pay rise in exchange for smooth implementation of job cuts and efficiencies. In fact Leighton may inadvertently have done postal workers a favour, since the union leadership would probably not have reacted as they did and decided to call a strike ballot, had it not been for Leighton's own unorthodox disregard for "partnership".

Of course even the current pay ballot does not necessarily mean that a fight will take place, even if, as is likely, the workforce votes in favour of industrial action. This is not the first time Leighton has failed to consult the CWU leadership before making some or other offer to the workforce. And each time it was his failure to ask them first which was the problem, not the offer itself.

Of course, this is all the more ironical as the CWU leadership has a habit of forgetting its partnership with its own members - by making deals with management behind closed doors and then presenting these to the workforce as a fait accompli, or, allowing a vote while recommending acceptance for deals which erode jobs and conditions. This happened with the last major deal on working conditions in the postal service, the "Way Forward" (dubbed the "Way Backward" by workers) after months of opposition by sections of the rank and file on the ground.

The embarrassment displayed by union leaders during this summer's unofficial walkout by BA check-in staff at Heathrow airport was another instructive illustration of what can be expected from them, including from those who would like to be seen as "fighting" trade-unionists. The BA strikers were opposing the introduction of a swipe-card system for clocking in and out, because they expected this to be the preparatory step towards drastic changes in the way their roster system is organised. Their wildcat action, in the middle of the peak holiday season, caused huge disruption and huge headlines. The union leaders hastily intervened to persuade the strikers to go back to work, while they undertook to "negotiate" with management on their behalf.

The line taken by Kevin Curran, the new GMB leader, was representative of the attitude adopted by all three union leaders involved. After achieving a "settlement", Curran explained in an article in the Observer newspaper on the 3 August that "the dispute was not a return to the bad old days' of the Seventies and was not a case of union intransigence". Sure, for Curran and his likes, what was "bad" about the Seventies was the number of strikes, not, as workers would see it, the fact that they did not win and that the union leadership sold them out! But that aside, his argument was almost to make apologies, partly on behalf of the strikers, but mostly on his own behalf as leader of one of the unions involved: according to him, this was not a vulgar strike about money (it is well-known that workers who strike over wages are necessarily "greedy"!) but about "work-life balance" and the failure of management first to consult workers about the changes. And he came up with the aphorism that "time is the new money." Never mind the fact that these were low-paid staff, mainly women with children, walking off the job for the first time in their lives. But would they even have considered working for the miserly £10- 12,000 a year they are paid (as much or as little as low-paid public sector and local government workers, or half a million call centre workers) if they had not had the opportunity of working flexible hours?

Curran went on to explain that the final agreement was not a victory for either side, but "based on consensus" achieved after his one-to-one meeting with the BA chief, Rod Eddington, where he was able to sort it all out, thanks to the CEO's "efforts and understanding of the issues". Curran is very anxious to show how responsible he really is, if not how similar he is to Eddington in his own outlook! The deal he and the other union leaders have brokered is hardly the end of the affair however, since it has opened the door to BA's integrated Airport Resource Management (iARM) system to improve efficiency by 17 September. Among other things, this aims at abolishing the flexibility which staff previously had in arranging time off for emergencies and reducing BA's notice period of change of rosters from 7 days to 24 hours. The staff who walked out on unofficial strike at the end of July may well have preferred a victory for their side, rather than this deferred victory for BA!

The stakes for the working class today are as clear as they could ever be. We cannot go on losing ground at the current rate, as we will soon have nothing much left to stand on. The only way out of this is to tilt the social balance of forces back in our favour. Which means, simply, a fight for common objectives against the bosses' greed, by using all the forces we have available on the ground, across sectors and industries. But it also means - and this is mandatory - that the preparations for this fight have to be made without any illusions whatsoever in the willingness of the union machineries to take it up or more to the point, generalise it.

This year's TUC conference debated the anti-union laws. There were calls for a national day of action on pensions and even a call for a return of the right to take secondary strike action. But no- one should be deceived by this. It was never the "law" which deterred the union leaders from confronting the attacks from the bosses - in fact the law only helped them to justify their passivity, which is not a new phenomenon. It was their own preoccupation with maintaining their status and recognition in front of the bosses which was and still is the problem.

Only last year, when the firefighters attempted to defend their jobs and conditions against so-called "modernisation" and fight for better pay, many sections of workers were already trying to fight against similar attacks (in local government, education, the civil service, among others). But there was no hint of an attempt by the various union leaderships to build a common fight - even if this was precisely what the government was afraid of at the time, that is that other public sector workers could be infected by the firefighters' militancy.

It has always proved possible, when workers have tried it, to co- ordinate with fellow workers across sections and even industries to plan joint strikes. This began to happen during the London transport strikes in 1989 for instance, when Underground guards and drivers took their dispute out of the hands of the union leadership for a period and co-ordinated strikes with the bus and railway workers - even if they later handed the initiative back to these same leaders, in the (mistaken, as it turned out) hope that they would negotiate a better deal for them.

We should learn from the past and, next time round, when the opportunity presents itself again, not wait for the union machineries to give us the means to fight. It is from our own ranks that the will to fight as well as the leadership for our future battles will have to come.

13 September 2003