|Volume 48 Number 7, March 17, 2018||ARCHIVE||HOME||JBCENTRE||SUBSCRIBE|
Commentary on Brexit and the NHS:
Workers' Weekly Internet Edition: Article Index : ShareThis
Workers' Pensions at Tata Steel Stolen by the Rich
Commentary on Brexit and the NHS:
Over the last year the effect of Brexit on the NHS has been reported on in Parliament and in the monopoly dominated media as claim and counter claim by those in both camps. The idea that Brexit will harm the NHS whilst a Remain agenda will not, or vice versa, is promoted in these claims and counter-claims especially on the funding of the NHS. In this way these claims around Brexit, or the Remain agenda, are being used to create misinformation, confusion and division. But worse than that and more dangerous for health workers and for the working class and people: it is an attempt to line people up in a chauvinist way behind the British or the EU monopoly interests. The fact is that the rights of all are under attack from all the neo-liberal interests of these factions that are fighting it out for dominance over Britain, the EU and the global economy.
Much has been reported on Theresa May's minority government Brexit stance, whilst the government has continued behind the scenes to impose the massive public sector budget cuts. In particular it continues to drive its health commissioner NHS England to "think the unthinkable" and continue to impose cuts to the NHS. This is forcing through withdrawals of "non-urgent" treatments, closure of hospitals and their services and encouraging the private sector involvement and privatisation of the NHS for which government new funding is mainly directed. In this way, contracts worth billions of pounds are being awarded to Virgin Care and US-based UnitedHealthcare. This is clearly one of the government's aims for the NHS as far as Brexit is concerned.
But in addition, as part of the EU of the monopolies, Britain has been and will continue to be a major enforcer of the pro-privatisation environment for health services in other European countries. Britain as part of the EU and the European Social Fund (ESF) investor-state dispute settlement (ISDS) has already made clear precedents with private companies using ISDS mechanisms to successfully seek colossal sums of money from governments that have attempted to reverse previous healthcare privatisation policies. One of many examples was in 2008 when a Dutch insurer Achmea (formerly Eureko) sued Slovakia via its bilateral investment treaty with the Netherlands because the Slovak government had required health insurers to operate on a not-for-profit basis. Following this the British government was a prime supporter of the EU Transatlantic Trade and Investment Partnership (TTIP), deal with the US which would have removed member states protection from public health care and other public services. Whilst TTIP has reportedly been halted in the EU since 2017 the British government has expressed its desire to agree a similar deal with the US through Brexit and Theresa May has several times indicated that US health giants will be part of that deal.
Also, in spite of the British government's Brexit intention to restrict the flow of people from Europe, it will continue to champion and welcome the privatisation of the NHS by EU corporations. For example, in Northumberland, NHS England is putting in place its Five Year Forward View model of the NHS with its strategic partnerships, including an EU company Ribera Salud. Northumbria's three major hospitals have had their acute and emergency services closed or downgraded to one Trauma Hospital at Cramlington, covering the huge area of Northumberland including the large urban areas around Ashington and North Tyneside. Now the Northumbria Foundation Group website trumpets a "Strategic Partnership" with Ribera Salud, which started in 2016. Ribera Salud  is the Spanish public/private partnership (or Accountable Care Organisation) that pioneered a form of Private Finance Initiative that covers not just buildings but "integrated" health care delivered by hospitals, GPs and community services for the whole population in designated areas. Ribera Salud has already failed in other ventures.
The reality is that in the negotiations with the EU over Brexit, control of the outcome is not with the people. The necessity is not to become fazed by the claims and counter-claims on Brexit, or divided by it, but continue as thousands of health workers are doing to build the resistance movement and fight together for the right to health care. The stand of health workers is say no to the neo-liberal health agenda in Britain, the EU and globally. This is part of the whole fight against the anti-social and pro-war direction of Britain and for a modern society where the working class and people are in control of their own pro-social and anti-war government.
On March 6, 2018, the Court of Justice of the European Union (ECJ) delivered a judgment on the Achmea case on whether an arbitration clause in a bilateral investment treaty concluded between two EU member states was compatible with EU law. The ECJ's response to that question was that the bilateral investment treaty was in violation of EU law because while an investment protection tribunal could be called upon to interpret EU law in a dispute between investors and states, its interpretation could not be effectively challenged via the court process, meaning that the ECJ's role as the final arbiter of EU law was infringed. Legal commentaries have suggested that this is the death for "Autonomous Investment Protection Tribunals". What will happen when and if Britain leaves the EU is another matter, and in any case the domination of private interests throughout the EU is bound to continue.
 Riber Salud is the health management
holding company for the Special Purpose Vehicle Ribera Salud Unión
Temporal de Empresas consortium. The shareholders are:
- The medical insurance company Adeslas S.A. (51%), as the technical provider of health services, with regional savings bank Agbar S.A as its majority shareholder.
- Regional savings banks Bancaja, CAM and Caixa-Carlet by means of a jointly-controlled entity - Ribera Salud S.A.- (45%), which was the financial partner for the project.
- Construction companies Dragados and Lubasa, which each took a 2% holding
The Northumbria website leaves out all
the evidence about what has gone wrong with the Aliza Public Private
Partnership/Accountable Care System - including the fact that, as with PFI
contracts in the UK:
"contracts may have been designed to mitigate risks to the private sector." (Spanish healthcare Public Private Partnerships: the 'Alzira model'. Acerete, B., Stafford, A. and Stapleton, P. (2011), Critical Perspectives on Accounting. Vol. 22, 533-549)
A study by Dr Anne Stafford of Manchester Business School, and others, assembled evidence that the financial reality is at odds with "the rhetoric, which declares this project to be a success story."
The capitation (per person) payment was set too low (204 Euros), which caused the failure of the Accountable Care System (the Ribera Salud Unión Temporal de Empresas - RSUTE - consortium).
Compensation paid out by regional government was 69.3 million Euros. The Accountable Care System consortium was re-constituted (RSUTE II) at a higher, and progressively higher, capitation amount (379 Euros in 2004 up to 639 Euros in 2012).
Under the RSUTE II consortium there were doctor shortages, a doctors' strike and continued staff dissatisfaction. According to a study carried out by the Universities of Zaragoza/Manchester and Manchester Business School, there were allegations that the consortium 'cherry picked' the most profitable medical and surgical specialities. At the same time it was referring HIV and other chronic disorders to other non-RSUTE II hospitals. The annual bill for regional government was very high.
And here is Hunt's call to denationalise the NHS and "break down the barriers between private and public provision".
Source: Calderdale and Kirklees 999 Call for the NHS
Whose pensions are they anyway? They are ours!
A recent disgusting example of how workers' pensions are being made fair game in the most blatant manner is the closure of steel monopoly Tata's pension scheme and fraud by so-called independent financial advisers. It is a particularly crass example of how, by hook or by crook, the ruling class claims possession of workers' pensions.
Tata, which employs 8,000 people in England and Wales, announced the restructuring of its £14 billion retirement fund last year, under the pretext that it would "keep its UK loss-making operations afloat".
This is standard propaganda starting from the capital-centric viewpoint that pensions are a cost, along with any claims on company revenue that reduce its bottom line. In fact, the bottom-line profit is itself merely one claim, that of the owners of equity - i.e. the shareholders - on the massive amount of value produced at Tata by its workforce. Other claims on the new value these steelworkers create every hour of every day go to other owners of capital, such as the owners of debt, they go to government via taxes and go to active and retired workers as wages and pensions.
Viewed this way, pensions are not a cost, and forcing concessions from workers on this front is not a solution to any problem of the need for and the problems faced by steel production in Britain. In the current conditions, monopolies such as Tata are obsessed with maximising their own claim on the produced value for their narrow private interests and competitive aims in the globalised economy; it is this that is meant by staying "afloat".
Exposing how public authority has been entirely taken over by private interests, the Pensions Regulator arbitrarily accepted the argument that Tata Steel UK would be insolvent if it continued to sponsor the scheme. When Tata first decided to sell the steel plants it owned, this had nothing to with "insolvency". When prospective buyers actually bid, Tata made an about-turn and decided not to sell, due to changed market conditions and the promise of government assistance. The company decommissioned some of its raw steel mills and kept only the most lucrative facilities, jealously making sure that no competitor could get their hands on these means of production. Even so, it still held the sword of Damocles over workers' heads, threatening jobs if they did not concede and make huge concessions on their pensions.
In a move supported by the Pensions Regulator - in their own words: "We believe this was the best possible outcome for everyone involved" - the 124,000 members of the old British Steel Pension Scheme (BSPS), were given between October and December 2017 to decide what to do.
The virtually overnight "choice" presented to members was to transfer to either to Tata's inferior replacement scheme, known as BSPS2, or the Pension Protection Fund (PPF). Both schemes will return less on average to workers than the old scheme, but the default option in the case of making no choice - and many retired workers were not in any position to make such a choice due to ill health - was the PPF, generally the less beneficial alternative.
This being the case, a flock of financial advice "vultures" descended on the affected workers seeking easy pickings, in a mis-selling fraud of massive proportions. The pressing deadline created the perfect conditions for these so-called advisers to take advantage. They presented scheme members with a third option of transferring out completely via what is called a DB transfer, an option the Works and Pensions Select Committee, in its report into the closure of the pension scheme, said is "not usually in someone's interests".
That is an understatement, to say the least. According to reports, 2,600 such transfers with a total value of £1.1 billion were made, largely under this advice, which is now being reviewed by the police. There are reports of workers losing tens and even hundreds of thousands of pounds as a result.
Work and Pensions Select Committee chair Frank Field remonstrated: "Pension holders were fleeced by financial vultures."
"Once again we find the pensions regulator fiddling while Rome burns, when it should have seen this rip-off coming," he said. "All the responsible authorities must act, now, to stop more people being cheated."
Likewise, the report also criticised the Financial Conduct Authority (FCA), which has since said it is reviewing the rules on pensions advice. The report pointed out that the plan to close the pension scheme had been in place since May last year. The parties involved - Tata, the government and the Pensions Regulator - had neglected the interests of the scheme's members, the active and retired steelworkers.
This whole affair paints a particularly damning picture of the politicisation of private interests through this arbitrary decision carried out as one by a big international monopoly, the government and state authorities, a decision that violates the rights of people to a decent livelihood in retirement. It brings into relief the need for workers to organise in defence of their interests and for their own decision-making power over the direction of the economy, so that vital production is not subject to the vagaries of the market and their claims on the social product in the form of wages, pensions and social programmes are guaranteed, depriving monopoles of the power to deprive the workers of these claims.
At the present time, a number of struggles involving different unions at various workplaces have been taking place over pensions. Final salary schemes are being closed and other schemes are being restructured or changed, all to the detriment of the workers who rely on these pensions to secure a decent standard of living in retirement, as is their right.
The history of past, recent and present such battles has shown that the government, parliament or the various regulatory bodies cannot guarantee pension rights for all. Not only do these threats to pensions need to be resisted, workers also need to consider the causes and solutions to ensure that a fully-funded livelihood in old age is guaranteed.
In fighting for pension rights, we must fight for the pensions we want in the course of fighting for the pensions we have. This means also organising for control over the direction of the economy, including restricting the rights assumed by big business to plunder pensions on the basis of their narrow self-serving aims and standpoint that pensions are a cost. It also means fighting the pressure to view pensions as a personal matter, a savings pot for one's retirement that is the responsibility of the individual and a matter of choice. Rather, they are a social necessity and a just claim by workers on the value that they themselves have produced.
One such struggle taking place is the strike action by university lecturers, led by the University and College Union (UCU). Lecturers who are members of the UCU are angry at proposed changes to their pensions, which they say could leave them up to £10,000 a year worse off in retirement. The employers, Universities UK, want to change the Universities Superannuation Scheme from a defined benefit scheme - giving a guaranteed retirement income - to a defined contribution scheme, where their pensions would be subject to changes in the stock market. Younger lecturers would be worst affected, says the union, with some losing up to half their pensions. As a result, lecturers at 64 universities struck work over pensions. Though lecturers were not teaching, marking or carrying out research, demonstrations showed that students widely supported their actions because their rights to a decent education are also involved if the conditions and morale of lecturers are undermined. As always, an injury to one is an injury to all and solidarity is the order of the day.
In another example, BT launched a formal 60-day consultation on proposed changes to the company pension scheme on November 15 last year. The Communication Workers' Union (CWU) has not reached agreement on any of the proposals. BT's proposals could radically change pension provision across the company with pension scheme members affected by proposals that the union believes fail to provide decent pension provision in retirement. The CWU are urging members to firmly say no to all of BT's proposals for both schemes.
Prison officers and their union the Prison Officers Association (POA) are petitioning the government through 38 Degrees, saying: "I want the Government to re-address the issue of the pension age of prison officers from 68 to 60." It is an established fact that the job of a prison officer is one of the most stressful jobs in the country, meaning that many officers do not make their retirement age, and if they do, they do not make it much past the age of 68.
Weekly E-mail Edition: It
is free to subscribe to the e-mail edition
We encourage all those who support the work of RCPB(ML) to also support it financially:
Donate to RCPB(ML)
WW Internet RSS Feed
Workers' Weekly is the weekly on
line newspaper of the
Revolutionary Communist Party of Britain (Marxist-Leninist)
170, Wandsworth Road, London, SW8 2LA.
Phone: 020 7627 0599:
RCPB(ML) Home Page
Workers' Weekly Online Archive