Defending pay, pensions and jobs in a global economy

Professor Gregor Gall reports from the sub-plenary of the Beyond the Market Economy conference

It might be remembered that Mick Rix, former ASLEF general secretary and the original ‘awkward squad’ member, coined the acronym FUWL – ‘fed up with losing’ – at the turn of the new millennium to describe what people like himself in the union movement felt. This should now be updated to something like ‘fed up with not taking advantage of the opportunities presented’ – whatever that unwieldy acronym would be.

Last year saw the palpable declining popularity of ‘new’ Labour, increasing public anger at the effects of neo-liberalism on the public services – even if the beast was not called neo-liberalism – and opportunities for joint union action over public sector pay, foundation hospitals and so on. But no advance was made because an insufficient number of major unions and their leaderships were prepared to stand up to the argument that if you resist ‘new’ Labour all you do is let the Tories in. Few were taken by the counter-argument that ‘new’ Labour cannot be as good as it gets.

Indeed, last year all but one of the unions affiliated to Labour played their part in making sure Gordon Brown was coronated as Labour leader, and thus prime minister, without an election. Although many of them agreed with the policies of John McDonnell MP, they would not use their weight to get him on the ballot paper to force a contest. Instead, they thought it would be better to be onside with Brown and influence him from inside his tent rather than from outside.

Many, including the RMT, FBU and PCS unions, argued that these affiliated unions made a grave error given Brown’s continuation of neo-liberal policies, most graphically but also ironically exemplified by his state intervention to bail out of Northern Rock to the tune of tens of billions of tax payers’ money. Others said if Brown was the answer, the unions were asking the wrong question.

Now a new opportunity to exercise real influence is being afforded to the unions. It is made up of four components.

First, a visibly weakened government – almost regardless that it is a nominally Labour government - is now more open to acceding to the politics of pressure. The £2.7bn tax refund has set the stage for this but already Brown has made concession to longstanding union demands on agency workers, flexible working and social housing. Having strenuously resisted these for many years, suddenly Brown has allegedly and under pressure re-found the social democratic pulse in his body. The unions should sense that a door is slightly ajar and they can force it fully open.

The second is that Labour is now more reliant on union funding than it has been for the last ten years. Not only is it in severe debt, but the donations from business and rich individuals have dried up. Indeed, the debt is so bad that the two GMB members of Labour’s NEC have been indemnified against personal liability for their share of the debt because the banks want their money back now. Moreover, a general election has to be fought soon and this requires a war chest. This means that the unions can quite legitimately ask for ‘best value’ for their funding – this being the term the government uses for its funding of the public sector. So they would say ‘Here are our policies and you must act on them if you want our money’.

The third is that backbench Labour MPs, worried about their re-election prospects and having lost their reverence for Brown, are now open to supporting a whole array of private members bills that previously they would not touch because of the whipping system. Last year, the Trade Union Freedom Bill was talked out and defeated by ‘new’ Labour. This year, it could be reintroduced and taken right through the Houses of Parliament to end up on the statue book.

Fourth, inflation is set to become a really big issue. Historically, unions have made some of their biggest membership gains when workers realise that they need unions (and industrial action) to make sure that the real value of their wages keep up with the rising cost of living. With bigger and more assertive memberships, the unions could park their tanks of the government lawn at Downing Street and the mere threat of striking could be wielded to great effect.

But this opportunity is the proverbial window of opportunity because it will not remain open forever. May 2010 is the time when the window will close because the Tories, as expected, will win the next general election. They will be less open to the union agenda because of their politics and the strength of their new mandate. In the meantime, other pressure groups will realise that the window will close soon and will ratchet up their lobbying so the unions need to move fast if they are to have a clear run at bouncing Brown into doing what they want.

So will the unions be bold enough to take the opportunity? We’ll start to find out pretty soon as most of the big public sector unions are balloting on widespread strike action against the public sector pay restraint.

The answer to this question ultimately revolves around seeing the 7m union members as a resource to mobilised, and the need to re-energise and expand the activist base in the union movement as a cog to turn this bigger union membership wheel and link up in joint campaigning work with the organisations of those users of public services. In other words, the issue is really one of mobilisation, and ideas are needed to inspire and motivate – particularly when actual struggle is at a low level. So to inspire and motivate, the cutting edge of ideas must be based on a left critique of neo-liberalism and a sense of what the socialised alternative is. Whatever variety of thought there is on these ideas, the central theme is nonetheless a socialised economy where intervention in the market – by the state or some other popular body – is needed to moderate and ameliorate market mechanisms and market outcomes.

In the sub-plenary and in relation to fleshing out issues and ideas that are contained within the challenge of building a fightback against neo-liberalism and to go beyond the market we discussed:

• Global unions – while participants were in favour because of the need to face capital on equal terms, the key issue was what kind of global union. Several aspects emerged; what national and regional workplace foundations would these unions be based on, and how would members participate in and control these unions. The fear was that these unions would be mergers of head offices or bureaucracies, adding little to bargaining leverage.

• Closing the gender pay gap – participants highlighted the myriad of ways in which structural factors under capitalism lead women to be congregated in low paid occupations (even if equal pay is enacted) and subject to breaks in career or incremental progression.

• Public sector pay – this was seen to be the key battleground for unions to show their mettle in and for unions to make a breakthrough on. Joint, coordinated action was agreed to be critical.

• Final salary pensions – it was agreed that these should be defended where they still exist because employers can afford them but recognition was made of the situation where many are not party to such schemes. Consequently, the idea of a social pension was discussed which would be based on need not earnings to take account of those that carry out domestic and caring responsibilities in particular.