Britain - The civil service under Brown's hatchet

Nov/Dec 2004

This 5 November, the first national 24-hour civil service strike in 11 years took place. The protest was called, "in response to massive government cuts", to use the words of the main civil service union, the PCS. These cuts involve a total of 104,150 civil service jobs - 84,150 in central government and 20,000 in the Scottish, Welsh and Northern Irish Assemblies to be carried out over the next three years - which amounts to almost 20% of the civil service headcount!

This unprecedented job-slashing exercise and radical shake-up of the whole civil service was formally announced by Gordon Brown, as part of his Spending Review, back in July this year. So the one-day strike, four months later, was a very delayed and rather muted "response" on the part of the union leaders.

Nonetheless, it was relatively well supported with 150-200,000 taking part and many well-attended picket lines and rallies across the country. This success was all the more remarkable because of the union leaders' obvious reluctance to mount any kind of militant fight back and the token nature of a one-day strike, for which there is no follow-up planned. And no-one can be under any illusions that this government is likely to back-peddle as a result of a one-day strike!

In fact, these cuts were the real "highlight" of Gordon Brown's post-budget "Spending Review" in which he boastfully outlined the plans for government expenditure up to 2008, in a context of "the longest period of sustained economic growth for a generation with the longest sustained investment in public services for a generation." If everything was so rosy, one may well have wondered why on earth such drastic cuts had suddenly appeared on Brown's agenda?

Of course, Brown had the answer: "a gross reduction in civil service posts of 84,150" was necessary "to release resources from administration to invest in the frontline". Yes, he claimed that the famous "frontline", of hospitals, schools, crime prevention, transport, etc., etc..., would be the ultimate beneficiary. So these were "good" cuts! The 100,000 or so public servants due to lose their jobs, had nothing to do with the delivery of public services, apparently. Brown characterised them as backroom bureaucrats, who were no longer needed, thanks to modern technology. They would be sent packing, would be "redeployed", or else they would have to "retrain" and get new jobs as frontline workers such as classroom assistants, or community support officers, etc., thereby having the privilege of contributing to an overall expansion in public services... thanks to the cuts in public services! By taking a lot from Peter in order to give very little to Paul - this "modernising" government is resorting to a very "old-fashioned" trick!

At the same time, the government is also trying another worn-out trick - pitting one section of the working class against another. According to Brown's demagogy, there are, on the one hand, those who slave away usefully, in the private and public sector, in order to make ends meet, and, on the other, "redundant backroom bureaucrats", whom he implicitly accuses of twiddling their thumbs all day long at taxpayers' expense. But the civil servants targeted by Brown's cuts are not part of the secretive army of dubious "advisors", consultants and quango business directors recruited by this government since it came into office. No, most of them are among the lowest of the low-paid and, far from living a parasitic life off public funds, they take care of such vital tasks as delivering welfare benefits for pensioners, the jobless and the poor, or checking out on health and safety at work, for instance.

But given its past record, who would expect this government to stop at resorting to such lies, when its real aim is to squeeze more money out of its budget for the benefit of the capitalists?

The City says hallelujah

Indeed, this is the real objective of Brown's cost-cutting exercise. Of course, he claims that the £21.5bn a year which the job cuts are supposed to "save" for the government - which is, in fact, grossly exaggerated - will allow more money to be injected into the NHS and education. But he has been very careful to avoid making any promises as to how much of these savings will be actually ploughed back into public services. And while the job cuts will be carried out, there is no guarantee that any new jobs will be created or any new funds invested in the NHS and education, where administrative departments are also earmarked for significant cuts.

Above all, it is ludicrous on the part of this government to claim that the only way to provide decent public services, is to cut the jobs of over 100,000 workers, who are doing useful tasks. As if the state did not have the means to raise the resources which are needed in the NHS and education. After all, how much does the £21.5bn "savings" promised by Brown amount to? Somewhere between the £19bn combined profits that Shell and BP are expected to make this year and significantly less than the £26bn combined profits that the five largest British banks made last year! And this is the huge "saving" which would justify, according to Brown, depriving more than 100,000 workers of the means to make a living?

As if there were not enough other sources of "savings" available to this government. Withdrawing from Iraq would be an obvious one, saving not only the £10-15bn/year cost of the war for the Treasury, but also many lives among the Iraqi population and among the soldiers. Another source would be the scrapping of all the new hi-tech military programmes launched by Blair, involving tens of billions of pounds worth of aircraft carriers, bombers and missiles.

Besides, there is always the possibility of taking the money from were it actually is - in the coffers of the capitalist class. For instance, by reversing the cuts in corporation tax that Brown has made virtually every year since 1997, to the point where company profits only account for less than 8% of total tax receipts today! Not to mention the possibility of reversing the virtual tax holiday which the wealthy have enjoyed for the past two decades and the tax rebates on dividends introduced by Labour. But for a government as determined as this one is, in its defence of the interests of British capital, raising funds by denting the profits of the rich or undermining British companies' ability to loot the resources of the Middle East, is obviously out of the question.

It is no wonder, therefore, that the City and its media were suitably impressed by Brown's announcement. With good capitalist logic they only noted the extensive job cuts - which are always "welcomed by the markets" as they say - and ignored the promises concerning public services, in the knowledge that their friend Brown will find a way to channel at least some of his "savings" straight into their pockets.

Of course, the job cuts had been the subject of regular leaks for months before, following the commissioning by the government of Sir Peter Gershon, the previous August 2003, to report on how efficiencies could be achieved in the civil service. But up until Brown's July speech, a figure of around 40-50,000 job cuts was expected. Now Brown had outdone even this and doubled the whammy!

The implementation of the Brown/Gershon plan meant a top-to-bottom shake-up of the whole civil service. Various departments like Inland Revenue and Customs and Excise were to be merged (involving jobs losses as well). There was to be further outsourcing of numerous functions to the private sector and a grand auction of government-owned land and buildings - i.e. what amounted to large scale asset-stripping. On the basis of another government-commissioned report, by Sir Michael Lyons, 20,030 jobs were to be relocated "to the (cheaper) regions". Then, in addition, there were to be a variety of attacks on workers conditions, including a clamp-down on sickness and an increase in retirement age to 65 years.

The City could only be ecstatic. Not only was Brown meeting its wishes in full, but he was actually pre-empting them!

The public sector giant and its civil service core

It is worth looking at how and where the civil service fits into today's giant public sector to get some idea of what the government's plans imply.

All in all, according to 2003 figures, the public sector employed around 5.5 million workers - or 18% of the UK workforce.

Of these, 2.5m come under central government, with 553,000 workers in the civil service, 1.4m in the NHS, and 206,000 in the armed forces. Another 2.8m work in local government - just over half of the total public sector, with 1.4m of these in education, 226,000 in the police, 315,000 in social services. Public corporations (like Royal Mail) employ 386,000.

The biggest civil service department is the Department of Work and Pensions, carrying out the administration and distribution of benefits and the implementation of the government's various policies towards the unemployed like the "New Deal" initiatives.

10 years ago there was one set of civil service terms and conditions of employment, negotiated between the unions and cabinet office/treasury. Now there are over 190 different sets of pay and terms applying within "delegated bargaining units". As a result, pay varies for the same grade and this system has also allowed pay to remain low for tens of thousands of workers. A good average salary in the civil service is around £13,750 per annum (gross), but a quarter of all civil service staff earn less than this!

In order to "deliver" new government policies such as tax credits, police the New Deal, or process and deport asylum seekers, the government increased employment in the DWP and the Home Office between 1999 and 2003 by 57,000. However cuts in other areas more or less balanced any increase in such staff. As a result, the civil service still accounted for 10-12% of all government employment in 2003/4 - a percentage which has remained constant for the past thirty years.

But this is now destined to change with the current cuts. It will fall to around 8% - the lowest ever. And what will the real "savings" be? According to the TUC, the government's target of £21.5bn cost cuts per year has very little to do with the savings on pay bill costs due to the culling of jobs. In fact, even if Brown sacked the entire civil service, he would achieve less than half this target - since the civil service's total wage bill is around £10bn annually! But given that, in addition, redundancies will cost something, and that temporary or casual workers would be required to fill gaps during the transition period, the TUC estimates that the "savings" due to the planned job cuts will be, maybe, a maximum of £1bn - in financial terms, as the TUC says in its own report on the government efficiencies, "they are peripheral".

In reality, it seems not only are these savings "peripheral", but they are about playing politics, which is gross cynicism, to say the least, since these flamboyant cuts affect people's livelihoods.

The pre-election grandstand

There is no doubt that Brown gave his Spending Review speech with an eye to the election which is coming next year. And that he was not only pre-empting the City's wishes, but also the Tories' demagogy.

Of course, all governments play to the gallery of the wealthy, the City and big business, first and foremost. And every government since the birth of the civil service has been dedicated to cutting it, in order to show that the taxes of the rich will not be "wasted" on spending for the population as a whole. So no matter which party is in power, it always pays lip service to the goal of "small (and cheap) government" even if not one of them has so far been able to achieve it.

When Labour took over in 1997, its game was to keep itself in power by out-doing the Tories. So, while it had to recruit civil service workers to implement its grand schemes to force the unemployed, the disabled and single mothers back to work, in order to cut the benefits bill, it also made moves to get these schemes to pay for themselves in the long run, by making cuts in other departments, and continuing the "outsourcing" of functions to the private sector. At the same time, however, it has needed to show its dedication to "small" government. Hence the commissioning of Sir Peter Gershon, former BAE and Marconi executive to look for ways to cut "waste" and cut staff, in the civil service last year.

When Brown made his announcement in July, it was obviously intended to pull the rug out from under the Tories - whose main policy plank with regard to the public sector and particularly the civil service, was that it needed to be cut radically, and turned back-to-front. Indeed, it was the Tories who at that time were talking about putting workers on the "frontline", thereby saving on bureaucracy! Brown took his leaf straight out of the their book! And it is quite beside the point that the distinction between front and backroom functions is meaningless, given that the two are interdependent. This is pure grandstanding by the politicians and has nothing to do with reality!

Oliver Letwin, the Tory shadow chancellor, of course points to a "bloated" civil service which the government had been making larger, not smaller. But after Brown's announcement he rightly pointed out that Brown could hardly implement all his job cuts since he was not in control of at least 20,000 of them which came under devolved administrations!

But, credible or not, the only thing that counts for Brown is that his figures impress the traditional Tory electorate.

On the other hand it may be worth mentioning the response of some Labour MPs on the re-location of jobs to their areas, which can only be described as sickening. The MP for Newport West, Paul Flynn, called it a "sweet jobs victory... a stupendous day for Newport" and Wales' First Minister Rhodri Morgan gave the job relocation " a warm Welsh welcome" saying, "we have been lobbying very hard for these jobs to come to Wales under the government's dispersal programme" - even if it means redundancy for workers in London and the South-east as well as cuts in the number of Welsh Assembly workers!

A few morsels for the private sharks

It is worth remembering that the last national civil service strike was against market testing, 11 years ago. This "market-testing" - which led to the subcontracting of public sector work to the cheapest private companies - was privatisation by another name and it has been vigorously pursued by the Labour government since 1997.

£120bn of government spending in 2005/6 is meant to go towards procurement of contracts from the private sector on behalf of the public sector. And while this procurement has also been targeted as another area for possible "savings", this gives some idea of the amount of taxpayers money that routinely passes over to the City's consultancies, IT providers, etc.

Of course, to replace many benefit offices and advice centres the government has already instituted "call centres" (eg. for pensioners' tax credit) and plans to open more of them. The rationale behind cutting DWP jobs is also underpinned by the fact that benefits are meant to be paid directly to claimants' accounts supposedly thus removing the need for some Benefits Agency workers.

All this new technology has meant big bucks for the IT industry. Total spending this year on government IT projects is £12bn - and the public sector is the industry's biggest customer. But despite the huge amounts of cash splashed out by the government to private IT providers, many of the subcontracted systems turn out to be faulty or even totally useless. The PCS website lists 12 of the most dramatic failures, going back to 1992 when £41m was spent on "Defence Project Trawlerman" to handle classified information, but was out of date by the time it was completed and had to be replaced with another system costing an additional £6m.

Labour's own list of disasters includes the Passport Agency's Siemens Business Systems programme, which caused a backlog of up to 18-months in the issuing of passports, and over-ran costs by £21.5m. More recently, the system for Working Family Tax Credit and Child Tax Credit, which was subcontracted to Electronic Data Systems, collapsed within weeks of coming into operation. This meant tax credits were unpaid for months leaving the poorest in sometimes desperate financial hardship.

But there is also another sinister aspect to the IT outsourcing, with former civil service IT in-house staff being ferried around between subcontractors. So, for instance, Inland Revenue IT workers were first handed over to EDS, then to Cap Gemini Ernst and Fujitsu. The PCS has presided over all of this, while reassuring members that their conditions would be protected by law, under TUPE - when by now, everyone knows it guarantees very little.

Obviously, Brown's job cut plans mean that more work will have to be subcontracted for lack of staff to do it - another handout to the parasitic profiteers who live off state contracts.

But there is also another bonanza for the sharks as a result of Brown's Spending review plans - the enormous auction of land and property owned by the government which is expected to raise £30bn. This will be supplemented by other asset sales and privatisations - including, for instance the Tote (the pooled betting service, which could bring in £200m), the Forensic Science Service (£80m), and even the MOD's school for spies(!).

The unions' non-reaction

The reaction of union leaders to Brown's plans for civil service job cuts ranged from the ambiguous to the outrageous.

For instance, the GMB leader, Kevin Curran, began his response to Brown's Spending Review thus: "We again welcome the Government's commitment to extra spending in health and education" - turning the usual sectionalism of the union machineries into a complete caricature of itself - more jobs for classroom assistants meant more members for the GMB, apparently! Of course, he went on to say that "Cuts on this scale are likely to have an impact on front line public services. This is something we would oppose". "Would" oppose? But it was the impact on services, not the impact on workers that he condemned.

More importantly, however, the union most concerned by the cuts, the PCS, with around 290,000 members in the civil service, was initially very reluctant to come out with all guns blazing - which would surely have been the only appropriate reaction in such circumstances. All the more so, because the union's general secretary, Mark Serwotka, considers himself as being on the left and part of the "awkward squad" of "militant" union leaders.

The PCS initial statement was extremely low-key: "...even at this late stage we call on the Chancellor to reconsider these cuts and rather than slashing services work with us to ensure sufficient public services that won't penalise those that use them." This was an invitation to the government to work in "partnership" with the PCS, not a call for workers to fight Brown's attacks.

Mark Serwotka was, however, just a little more militant-sounding later on when he said,: "Job cuts on this scale spell carnage for public services,...we cannot rule out industrial action in the face of such a serious attack". But strike action was not immediately ruled in, either! And it took until 5 November, before some kind of reaction to Brown's cuts was actually organised, in the form of a national one-day strike.

A wasted opportunity

In terms of a national and united plan for action, it seems that this is about as far as the PCS union leadership is prepared to go. It was so afraid of "losing" its ballot for 5 November, that instead of campaigning to convince the membership to vote for an open-ended strike, or series of strikes, as a more effective way to organise the fight back, the ballot paper explicitly limited itself to asking members to vote for a one-day strike only. So, if a further national strike is to take place, there will have to be a re-ballot, with all the bureaucracy and delays this involves!

This is problematic in several respects, not least because the turn-out in the government's mandatory postal balloting system is always low, and inevitably derided as such by both the employers - who often resort to challenging ballot results in court - and the media, for not providing a "true"mandate for action. Indeed, this was their response to the result of the 5 November ballot, whereas in fact the 42% turn-out (113,087 votes cast) and 64.5% "yes" vote ranks as a relatively good result compared with other similar ballots.

The official excuse for the choice to ballot for a one day strike only, is that the union leadership needed to "test the water" to see how the membership was going to respond, given that many civil service departments had never been out on strike before. Maybe so. Although the role of a union which seeks to organise its members to defend their material interests is not just to "test the water", but also to "warm it up", by convincing members that it is worth fighting and possible to win. In any case, even before this "test" could be evaluated, it seems that a decision had already been made that afterwards the initiative would be passed on to the 190 departments to carry forward the action on their own - a "back to the groups" policy.

The rationale provided for this is even worse: that many departments will not initially be affected by the job cuts - and certainly not the first wave - so how can they be expected to take action, given it would be "for" their fellow workers, but not themselves?! As if having one's back against the wall is the best position from which to fight! And as if workers could not be trusted to understand the interconnection of their interests! But no, the PCS leaders have apparently no confidence in their own members seeing a reason for taking action, other than taking care of number one!

Even left PCS activists have gone along with this, to quote just one among many who have been writing articles and leaflets in the run up to the strike: "Tactically, attempting to call sustained action at this stage, when in some departments cuts will not bite for some time to come, might well be counterproductive. But further action will be necessary. While mobilising the entire membership of the union is important, it is increasingly clear that the PCS will also have to revisit whether selective action by strategic groups of workers is the most effective form." Given the long-standing tradition of organising such "selective action by strategic groups of workers" (in some cases for months, back in the 1980s), PCS activists ought to know that such actions achieve nothing, except the isolation of workers in the "strategic groups" in question and their demoralisation!

In any case, this now means that only selected departments (and activists want to target those "which make revenue for the government", like Inland Revenue, Customs, and DVL) will be a spearhead for action, that is if the union members in these departments agree. Which plays right into the hands of the "divide-and-rule" regime which has so hampered civil service workers in their fight against all the government's attacks in the past, not least over the issue of pay!

Unity on the ground, between workers in sections of the same union seems just "too difficult" to achieve for the PCS leaders! But it all depends on their priorities. And it seems that members are not near the top of the list. Instead they aim at MPs, TUC and Party fringe meetings and lobbies of Parliament! Thus, the PCS leadership boasts of how 64 MPs are "hard at work campaigning against the threatened job cuts" and of the 120 questions tabled in the House fo Commons on behalf of the PCS this year. That is surely going to force Brown to cancel his job cuts!

As for any fight back, it is indeed likely to be carried forward by those departmental workers who are most hit by the initial cuts in the absence of any alternative. And that means workers in the DWP who face 30,000 net job cuts, the closure of 42 offices, and the redeployment of 10,000 of them to the government's flagship job coercion agency, Job Centre Plus. Or the Inland Revenue workers and Customs and Excise workers who face 16,000 job cuts and a merger.

But what a wasted opportunity, when, for once, on November 5, civil servants could have had a chance to get some idea of their collective strength! Of course, this could only have happened if a next stage was already planned, for which the strikers could have begun to prepare together during this first one-day strike, by formulating the kind of fighting objectives which could weld their ranks across the multiple departments, arming them against the demagogy used against them by the government and providing them with convincing arguments to try and win the active support of other sections of workers.

The constant emphasis placed by union leaders on the threat to services resulting from these job cuts, is a double-edged sword. First because it means that workers have to "prove" that they deliver a "service", which may not be so obvious for those working in customs and excise or in the immigration service, for instance. And second, it plays into Brown's hands, in so far as he claims that these workers are redundant.

Why should workers have to make any apologies or excuses for defending their right to a decent job? The kind of "public relations" exercise addressed to "public opinion" that union leaders call a "campaign" is a dead end, not a way of fighting back. It may possibly win the sympathy of other workers, but it will not win their active support. And when workers need to fight back, it is allies, not sympathetic onlookers, that they have to seek.

What really matters to the civil servants whose jobs are under threat? To be helped into another comparable job, without being forced to move to some distant location, under Brown's relocation scheme. Would it cost some money for the government to accept this simple demand? Maybe, because it may involve creating another useful job in the same geographical area - among the many kinds of jobs which are in such short supply at present in public services - and providing some real training into the bargain. But whatever the cost, society would benefit. Whereas when Brown pays 2 or 3 times the in-house price for an IT system which never works, society does not benefit, it only pays for the sharks' profits.

So it is all a question of choice - whether to use public funds in order to line the pockets of the profiteers or to use them in order to create useful, decent jobs for those who no longer have one. And who is better placed to control the choices which are made, than working people, who are at the receiving end of the state's constant cuts in public services? This is the kind of language that civil servants, and in fact all public service workers, could use in order to try to win over to their side the majority of workers who have had enough of seeing governments creaming off the public purse at their expense, in order to subsidise the capitalists' profits.