Most of us are embracing the new world of Zoom during the so-called lockdown. In Unite, it has allowed us to talk to members across all our nations and regions about this pandemic and its impact on their lives.
Again and again we have heard stories of members forced into their workplace, told that their work is ‘essential,’ they are ‘feeding the nation,’ they are ‘key’ to fighting the virus. Our efforts have seen our membership grow but so many are petrified, they have had to fight for workplace social distancing, basic cleaning materials and PPE. Very little has been given voluntarily by employers preoccupied with protecting their balance sheets rather than protecting the health of their workers.
The handling of this crisis has not been about the government moving slowly, it has been about the government failing. They failed to lock the nations down at the latest in early March when they had a chance to control a pandemic that was literally doubling every two to three days, they failed to secure PPE and they have failed to provide the basic protection of testing to those who have put themselves in harm’s way.
As the return to work starts and we hold our breath and cross our fingers that there is no second peak we are left with the realisation that holding breath and crossing fingers seems to be in large part the government strategy.
But another challenge now presents. Those same employers who were so slow to protect their workers are now moving at speed towards mass redundancies. Workers who built company balance sheets are to be discarded in the name of survival. Terms and conditions, fought for over decades, are being shredded.
The opportunity of this crisis is too much to resist for the likes of Willie Walsh of British Airways, who gave the green light to Section 188 redundancy notices on the very day that Cabin Crew buried one of their own, who had likely contracted coronavirus from repatriating British citizens. For BA Workers’ Memorial Day was the day to announce 42,000 redundancies with 30,000 to be reemployed on slashed terms and conditions. Fire and hire, with every collective agreement torn up.
The truth, of course, is that the Chancellor’s job retention scheme is in danger of being nothing of the sort, merely a delay of months before millions are out of work. The Tory mantra of “we will do whatever it takes” looks increasingly hollow, like some discarded election poster blown around the streets long after polling day.
Put simply, the intended increase in employer furlough contributions for September and October, before sectors have begun to recover, will see hundreds of thousands, if not millions, made redundant.
Toryism is being exposed precisely because of what John Maynard Keynes, a great figure of the last great crisis, once said, “the difficulty lies not so much in developing new ideas as in escaping old ones.” The old idea is that market forces can repair the economy. It is an idea that will destroy lives in the coming months if left unchallenged.
Coronavirus is a global pandemic unprecedented in our age and more people have died from it than ever died during the Blitz. It is an event that should change the psyche of the British working-class, as the Second World War did, and see us demand new solutions.
The labour movement must lay down the gauntlet to the political class with a clear set of economic and social demands that can influence the course of history. Here are six suggestions:
1. No bailouts for tax dodgers
The Tories are gearing up to hand no-strings-attached bailouts to big businesses, many of whom will go on to cut jobs. By contrast, France, Belgium, Poland and Denmark have banned firms based in tax havens from accessing bailout cash. This pandemic presents us with a historic opportunity to hold tax avoiders’ feet to the fire. We know the UK is the world’s leading enabler of tax avoidance. A simple clause in bailout contracts requiring firms to relocate their headquarters to Britain could recoup billions of pounds in revenue for the British taxpayer.
2. Rights and conditions on the board of bailed out firms
When Gordon Brown bailed out the banks in October 2008, he made a key error. Although the UK took seats on the boards of these companies, government did not use its voting rights on the boards proactively. Nor did the he attach proper conditions to the bailouts. Rishi Sunak is about to make the same mistake. This time, the UK must attach rights and conditions when bailing out UK firms, specifically to prevent redundancies. These bailouts must prevent practices which pocket the bail out but then proceed to pursue job losses and running companies into the ground.
3. Reverse changes to the furlough scheme
From September 1st employers will be expected to pay at least 10% more towards furloughed workers’ wages – from 20% to 30%, rising further to 40% in October. This is the old thinking that the market can repair itself, but it doesn’t reflect the reality. Thousands of hospitality businesses, for example, are unable to trade through no fault of their own. By cutting the furlough support the government is condemning many thousands to unemployment as big businesses seek to preserve their balance sheets before paying the additional wages needed to preserve the livelihoods of those workers who have helped build the company in the first place.
Labour must recognise the error of its quick praise of Sunak for extending the furlough scheme. Furloughed workers face a winter of fuel poverty or struggling to pay soaring private rents that have climbed £2,000 per annum in the last decade under the Tories. Workers did not cause this pandemic; we must not let the Tories punish them like they did in 2010 for the sins of bankers.
4. No return to austerity
Speaking of the bankers’ crash, austerity must never return. Nor can we accept the old Tory assumptions that workers must pay for this crisis with their jobs or reduced wages until the market repairs itself. To recover from the economic damage caused by coronavirus, we must revisit the lessons of how we emerged from similar circumstances in 1945. The OBR shows that after World War II UK debt grew to 270% of GDP, about triple what it is today – but sustained economic growth soon overcame this mountain. After WWII, the UK built a million homes and a National Health Service.
We must not repeat Osbornomics which saw a decade of Tory austerity that delivered stagnating real wages, and no real GDP growth per capita. Osborne’s stated goal of eradicating the deficit wasn’t even achieved. Austerity failed on its own terms, if repeated now it will have much worse, deeper and far reaching damage to the British economy. It will not be stagnant wages but mass job losses, followed by the loss of homes. We have a chance now not to repeat that mistake. Pandemic debt is wartime debt and must be treated the same. Park it and move instead to build an economy that can grow us out of this crisis.
5. Borrow now to invest our way out of crisis
So, how do we grow our economy? Recently interest rates on UK bonds turned negative. Government borrowing has never been cheaper. History will not be kind to our government if it ignores the chance to borrow now to invest in building a sustainable economy. The government should bring forward capital spending contracts on infrastructure to safeguard jobs such as those at Rolls Royce. East-west rail, tram lines and an electric car revolution could propel Britain to become a world leader in engineering.
The government could use this crisis to build a tram network throughout the UK that would enable low cost green travel and support thousands of construction jobs. Solar panel costs have continued to drop to historically low costs. As we know, green investment is a solution not only to coronavirus recovery but to the climate crisis. Borrowing now at cheap rates could equip every home in Britain with solar panels and solve fuel poverty overnight. This is also pivotal moment for the UK housing sector, why not invest in sustainable social housing? Freeing workers from the stresses associated with insecure housing would boost output, aiding workers and businesses alike.
6. A new industrial strategy
Coronavirus has exposed the gaping holes in Britain’s supply chain. We were forced to go cap in hand to countries around the world, many with dubious human rights records, begging them for PPE for our NHS heroes. There has surely not been many more embarrassing national failures in recent times than the inability to equip our NHS with protective equipment.
Early in the crisis, when it seemed like ventilators would be crucial, based on the Italian experience, we were left scraping around. The government had to beg Tory donors to build them because Britain’s industrial capacity had been so worn down. A fundamental lesson of coronavirus is that we should nurture diverse industrial sectors, because you never know when you might need them.
And the role of government direct intervention in industry has never been so important. The government must reform its contract tendering rules to give preferred bidder status to British firms. It should take a much more active role in preventing foreign takeovers of British firms which see them relocate jobs overseas at the first chance. To safeguard aviation, the government must make it clear that if British Airways proceeds with its sacking of 43,000 workers (with 30,000 lucky enough to be offered new contracts on vastly reduced terms), then it will be disqualified from using the national flag. We should review its aircraft slots at British airports. Guaranteeing slots to BA must be conditional to them guaranteeing British jobs.
Safeguarding jobs is a national responsibility at a time of crisis. We must build an economy that maintains employment, cherishes our interdependence and recognises that the health and happiness of our communities has a direct benefit to sustainability of our businesses.
We are at a fork in the road. The question is, can Labour step up and take the initiative? Any so-called “constructive” approach will likely allow the Tories to disguise their disastrous handling of this crisis and lead to working people paying for this pandemic for generations to come.
We can’t allow the grip of neoliberal ideology to tighten as Tory proposals for the post-crisis economy go unanswered. As a movement we must now step up and fight for a new deal for workers. We must be confident that there are necessary, achievable alternatives within our grasp. And above all, we must be ambitious.