Workers' Weekly On-Line
Volume 51 Number 9, March 13, 2021 ARCHIVE HOME JBCENTRE SUBSCRIBE

Need for New Direction for Economy Further
Confirmed by Government Budget and Economic Policy

Workers' Weekly Internet Edition: Article Index : ShareThis

Need for New Direction for Economy Further Confirmed by Government Budget and Economic Policy

Government's 1% Pay Offer for NHS Staff:
Concern Continues among Health Workers about the Conditions They Face

The increasingly widespread use of "fire and rehire":
Resistance to Assault on Workers' Rights Continues to Build

Need for New Direction for Economy Further Confirmed by Government Budget and Economic Policy

Chancellor Rishi Sunak's Budget of March 3, as his Spending Review had done last year, was put forward as posing serious questions on the present and future of the economy. His outlook in answering them was that of what will favour the wealthy. As many commentators have pointed out, there was nothing in it for the working class. And what has caused more outrage than anything else is the pay rise of only 1% for NHS workers, which is by no means keeping in pace with inflation, and therefore consolidates a pay cut. However, the issues are not simply whether it is the rich or the workers who benefit, but of the whole question of the direction of the economy which the Budget and the overall economic policy of the government confirms. His plan to "protect the jobs and livelihoods of the British people", part one of his three-point plan, will not do so, neither will the third part, that of beginning "the work of building our future economy". Both of these are in contradiction with the second part of his plan, which is to "begin fixing the public finances".

This is once more the tired argument for austerity, that funding of social programmes must be curtailed, that the function of government is to balance the books. And all the while, the government has been throwing money at the rich. It is well-known what a scandal the contracts handed out to private concerns has been, totally contrary to the public good. Furthermore "fixing the public finances" does not recognise that precisely the opposite is required for a modern economy that serves the public interest. And neither does it recognise the full scale of the economic crisis, which has been exacerbated by the Covid pandemic.

If public well-being is not put at the centre of considerations of the economy, then what is the aim of an economy? The government should realise that for an economy to thrive, or at least to find a way to resolve its crisis, then it cannot be that more is taken out of the economy than is invested in the public sector. The government's measures are short-term, and geared to hand-outs to the billionaires and oligarchs. And this is done in the name of "Global Britain" and "Build Back Better".

For instance, the government believes that to take responsibility for the economy is abnormal. As long as the pandemic persists - and it shows callous disregard for the well-being of working people here as well - the government will extend the furlough scheme. But it is perfectly content to suffer mass unemployment when the scheme ends. It is enmeshed in crisis, because it does not want to recognise the social wealth which is produced by working people. It is perfectly willing to back social programmes when it facilitates private interests. In fact, their whole economic outlook is to act on behalf of those private interests.

What is required from a government which has the interests of a human-centred economy at heart is the defence of the producers of all value, the working class, to take hold of what belongs to them by right. This in turn requires a fundamental change in the direction of the economy. Before the pandemic, the economy did not provide stability and security for all. With the pandemic, Rishi Sunak is recklessly ignoring these challenges. Despite his claims of protecting the jobs and livelihoods of the British people, he is instead opting for what favours the interests of the financial oligarchy. The Chancellor is looking for an excuse to perpetuate austerity, the approach to the economy that funnels wealth which has been claimed for the public treasury to the rich and reduces the claims of working people and public services. The treatment of the NHS and its workers is a case in point. When all the rhetoric is stripped away, the disgraceful slap in the face for its staff as they work in intolerable conditions is the reality, along with turning more and more aspects of the health service to private concerns who suck up public funds like there is no tomorrow.

The concern to overcome the economic crisis exacerbated by the pandemic is a charade. The concerns of the financial oligarchs are what is being pursued. The long debates in the House of Commons are to no effect because the vantage point is not that of empowering working people to make decisions on what is produced, what is useful and necessary for the economy and that the working people should have control over their lives and conditions. It is as if human beings had no control over the fate of the economy. This cannot be allowed to continue. It means otherwise that corruption as a symptom of the state funds being under direction of private interests will flourish.

The elephant in the room also is the spending on war. Not only is this a component of "Global Britain", and puts a wholly different light on "Build Back Better", and therefore consistent with Britain's intervention globally to the detriment of peace, security and sovereignty. But it is immensely destructive to the economy, and to the natural and social environment. The ruling elite can always find the funds to spend on war, yet it does not figure in the Budget calculations as elaborated by the Chancellor.

Yet using the argument that government borrowing is comparable only to that during two World Wars and must be paid back, and must not be allowed to rise unchecked, the Chancellor plumps for "sustainable public finances" as though the government is a long-suffering victim of circumstances. Working people are to bear the brunt, while interest paid out to the financiers and big business is staggering. At the very least, a moratorium on debt repayment is called for, and government borrowing from private moneylenders restricted. A procedure could be instituted whereby the government borrows from itself, not the rich, and the debt repaid from the new value workers create in an expanding and stable economy. If the government used the money borrowed from itself to invest in public enterprise then the increased value and income from those enterprises would quickly repay the debt and more. The National Debt in that sense as an ideological construct is there to benefit the rich. There is much propaganda which obscures the source of the funds in the public treasury, which is the claim the government makes on the social wealth produced by working people, and instead government debt is used to try and justify reducing investments in social programmes.

There are other features of the Budget besides the real pay cut for the nurses which reveal the callous indifference to the conditions of the working people, especially the poor and vulnerable. There is the £20 cut to universal credit, for example. The freezing of the income tax allowance is another example. The crisis in investment in education is another feature, which makes a mockery of the government's boast of creating a "world-class education system". Education is being geared to the needs and interests of the big corporations, and strict budgets are the order of the day. The "kick-start" scheme itself is a fraud where the economy is in a state of devastation. The fraud of "balancing the books" is used to justify this indifference. It even prompted the head of the UN's Office for Humanitarian Affairs, Mark Lowcock, to declare that ministers have decided to "balance the books on the backs of the starving people of Yemen". This is the funding crisis that the government is creating, one in which there is no protection for living standards and guaranteed employment.

The government does not seem to realise, or wilfully ignores, that an unemployed workforce does not produce social wealth for the economy. It does not have to be this way. The balance between going to work and being safe from the pandemic is a false dichotomy. The people themselves can find a way out of this crisis, hold the government to account, and work out solutions. The enterprise of human beings themselves in the society is an important way to deliver funds to the government, as well as insisting the monopolies and oligopolies provide the funds for the public services and infrastructure which they utilise.

The working class and people must reject as a whole the present disastrous direction for the economy, as exemplified in Rishi Sunak's latest Budget, and champion a new direction. Competing in the global market and searching for the maximum private profit is the old direction, which includes destruction of the means of production, blocking extended reproduction of the productive forces, in favour of what gives the oligarchs the highest and quickest return. A new direction would be to plan for an economy which produces for people's needs, trades on the basis of mutual benefit, and puts international trade in the hands of public authorities not of the marauding international oligarchs. The working class with its independent programme has the project of becoming the decision-making power and building such an economy.

Article Index

Government's 1% Pay Offer for NHS Staff

Concern Continues among Health Workers about the Conditions They Face

On March 4, following the budget announcement, the Department for Health and Social Security (DHSC) revealed that it had recommended to the NHS pay-review body only a 1% lower than inflation increase for NHS staff for 2021-2022 [1]. This decision follows an upsurge last year of health workers against pay inequality, when the government gave an above-inflation pay rises to 900,000 public workers but not health workers [2]. Now, the government says they will "wait for the response from the independent pay review bodies before we announce the pay settlement".

In the days following the announcement there has been increasing opposition from health workers and their trade unions that this not only fails to recognise the contribution of all health workers during the pandemic, but also, because the government has recommended a lower than inflation pay offer, the pay "increase" will amount to a cut in pay for NHS staff in real terms. In addition, the government has now frozen the pay of other public sector workers. To add insult to injury, all the carers and those playing a vital role in the pandemic have had their pay and conditions ignored as well.

Speaking out in opposition, one health trade union branch pointed out in their post that it was the people who have been taking up responsibility for the health care team and not the government. "The 1% pay offer for NHS staff is disgraceful. It's a missed opportunity to recognise the work of all NHS staff throughout the pandemic. We are ONE TEAM and we all play our part. Our amazing Nurses would be the first to say they couldn't do their job without the rest of the support team behind them. Domestic, Porters, Catering, Administrative, IT, Supplies, Estates, Medical Records staff and many, more. Not forgetting our Human Resources and Occupational Health staff who have supported all staff throughout this crisis. The public has gotten behind the NHS staff with gestures of kindness hand cream, chocolates, coffee, pizza and much more. This Government offer is equivalent to one cup of coffee per week!"

The recommendation by the government to the Pay Review body covers some 1.5 million health staff in NHS England, Scotland, Wales and the north of Ireland. The recommendation does not cover over 160,000 staff who work for agencies, or who have contracted out employment. It also does not cover an estimated 1.65 million staff working as carers in care homes and in adult social care. Doctors, dentists and very senior managers in the NHS have separate pay review arrangements.

The recommendation says that, during the pandemic, "the government announced a pause in public sector pay rises for all workforces, with an exception for employees with basic full-time equivalent salaries of £24,000 or under and for the NHS. In settling the DHSC and NHS budget, the government assumed a headline pay award of 1% for NHS staff. Anything higher would require re-prioritisation." Whilst the government claims that this is because Covid-19 "has placed a huge strain on both public and NHS finances", it is in reality a direction of using "both public and NHS finances" to pay the rich that is the issue. The present and previous governments have cut NHS services and public services whilst contracting out more and more services to private corporations. During the pandemic, this has seen vast sums being paid out to private individuals and corporations, private interests which the government have been keen to include more and more in the health and social care system. This i s the capital-centred prioritisation that the government is following and which it is trying to justify over their lack of investment in the human resources of a publicly provided NHS service.

In fact, on March 8, Helen Whately, who is a Minister of State at the Department of Health and Social Care, in answering an Urgent Question on NHS pay in the House of Commons, could only taunt the Opposition as to what their priorities would be in funding a pay rise for NHS staff. Only Jeremy Corbyn, now an independent MP, really highlighted the necessity to pay NHS staff properly and highlighted the scandalous payments to private corporations. He said: "Nurses have seen us through this crisis and have saved many lives, yet they are offered a pay cut as a result of it. Some are already having to resort to food banks to survive, and a third are thinking of leaving the profession unless they get a decent pay rise. Surely to goodness, if £37 billion can be found to pay Serco for a failed track and trace system, the money must be available to pay NHS staff properly."

That the government's thinking was in a completely different direction was reflected in the Minister's answer to Kevin Hollinrake, a Conservative MP, who said that "every 1% increase will cost the taxpayer £750 million" and how would the government pay for that and health and social care. He suggested it should be done by means of a "German-style social care premium" [3]. The Minister replied that the government would indeed "bring forward proposals for social care reform" and that Hollinrake "is absolutely right that we also need to look at the whole health and social care system as we consider these difficult questions". In other words, the government is already planning further tax hikes and other ways of charging to pass the burden of the crisis onto the people, whilst they continue to pay the rich. They are also planning to push through further legislation on the NHS as set out in the government's NHS White Paper [4] which has the same aim.

These latest developments have done nothing to alleviate the concern among health workers about the conditions they face, their well-being both before and during pandemic with their jobs and the services they provide. Health workers have made so many sacrifices to provide the best possible health care under the circumstances of the pandemic and where many have died. Health workers also require the time and space to exchange views on the situation, speak in their own name and assess what can be done to block these increasing attacks on and privatisation of NHS services whilst protecting their own conditions. They are determined that solutions be implemented that can alleviate the crisis for the benefit of all.

1. The Department of Health and Social Care's written evidence to the NHS Pay Review Body (NHSPRB) for the 2021/22 Pay Round
2. Nurses Upsurge Against Pay Injustice: Support Health Workers in their Ongoing Campaign for Safe Working Conditions and Pay Equality - Workers' Weekly September 19 2020
3. German-style tax on the middle-aged 'could solve social care funding crisis' December 7 2018
4. NHS White Paper: Continuing the Wrong Direction for a System of Health and Social Care - Workers' Weekly February 27, 2021

Article Index

The increasingly widespread use of "fire and rehire"

Resistance to Assault on Workers' Rights Continues to Build

The method of so-called "fire and rehire", where workers are recontracted on unfavourable terms under threat of termination of employment, or in other cases forced to re-apply for their positions, has become a widespread phenomenon particularly over the past year of the Covid-19 pandemic. Its use is now so extensive that it is being taken up by various unions, the TUC, and in parliament.

British Gas workers on strike against fire and rehire

Some 1 in 11 (9%) of workers of over 2,000 people polled for the TUC last November [1] had experienced the tactic in some form. The poll also found that this doubles (18%) for workers aged 18-24 years old. Black and national minority workers were also disproportionately affected (15%).

Unite is calling for a change in employment law to outlaw the practice [2], while GMB petitioned for parliament to debate the issue [3]. A parliamentary motion was placed by Shadow Employment Rights Secretary Andy McDonald on January 25, calling on the government to set out a timetable to introduce legislation to end fire and rehire tactics [4].

Fire and rehire is a method being used to marginalise workers and prevent them from meaningfully expressing any kind of opposition. It is akin to the overt rule by police powers.

Part and parcel of the anti-social offensive, a general disequilibrium exists in the social relation between those who work and those who employ them, the owners and controllers of business and the economy as a whole.

This disequilibrium exists both at the level of society and in individual workplaces, where employment relations have become entirely one-sided, under the absolute control of the employer. Without equilibrium, there is social disruption and chaos. All that exists is the one-sided relation dominated by competing powerful interests [5].

Imposition and arbitrariness are features of this situation and amount to a refusal by those in control to recognise the right of workers to negotiate collective agreements; as such, they amount to an attempt to render workers and their unions powerless to resist.

Recognition of this right is a starting point for regaining an equilibrium in a workplace and contributes to bringing about an equilibrium in society as a whole. People have a right to an equilibrium at work and in general to be able to live and work with a degree of security and without a constant and increasing sense of anxiety.

Such an equilibrium is possible and has existed in previous times but is only possible if based on the dignity of labour and the rights of workers, including to organise collectively and decide in consultation on pay, benefits, pensions and conditions. Equilibrium requires acceptable terms of employment that employers do not undermine.

Instead, the powerful oligarchy of huge global monopolies has organised an anti-social offensive to restructure all arrangements from the level of the state down to individual workplaces to increasingly polarise the social relation and exacerbate the prevailing disequilibrium for self-serving ends, against the interests of society. Unable to accept anything that restricts their assumed right to maximise private profit, they have torn up the civil society arrangements and increasingly exercise control through direct imposition.

It is therefore significant that the unions are taking this up politically and legally. It reflects the state of the conditions and the manner of how authority has increasingly come into contradiction with those conditions. The arrogance with which the owners of capital act with impunity through their offensive against the social interest and any pro-social arrangements calls into question their traditional and legal position of authority.

The need is to bring into being a new legal coherence and arrangements amongst the people, socialised economy and state. What is required is for working people to constitute a new kind of authority where they speak in their own name and are empowered to restrict the rights of the monopolies, allowing them to set the terms in establishing an equilibrium in their favour and in favour of society. To achieve this requires strengthening the workers' independent outlook and organisation, as part of building their resistance.

1. TUC, "'Fire and rehire' tactics have become widespread during pandemic - warns TUC", January 25, 2021
The TUC explain that BritainThinks conducted an online survey of 2,231 workers in England and Wales over November 19-29, 2020. Further: "All respondents were either in work, on furlough, or recently made redundant. Survey data has been weighted to be representative of the working population in England and Wales by age, gender, socioeconomic grade, working hours and security of work in line with ONS Labour Force survey data."
2. Unite the Union, "Stop 'fire and rehire'"
3. GMB, "Stop fire and rehire"
4. Hansard, "Employment Rights: Government Plans", House of Commons, Volume 688: debated on January 25, 2021
5. The reason for this state of affairs is ultimately the highly efficient and sophisticated nature of the modern socialised economy and its fragmented ownership into privately-owned competing parts, showing up as a dwindling rate of return on investment for the owners of capital.
These owners claim their profit, or added-value, from the new value created by the working class. Modern business, in order to compete, invests large amounts of capital in automated machinery, computers, and other means of production, giving rise to an economy that is so productive that a vast social product, in the form of goods and services, is produced with relatively few workers contributing work-time compared to the past.
As a result, a given commodity typically holds far less new value than the pre-existing old value transferred to it by machinery and so on. In this way, increasing productivity has greatly reduced the amount of new value produced in relation to transferred-value, the social product, and the total invested capital.
In the present, powerful global oligarchies are driven by ever fiercer competition to maximise their claims on the new value produced by the working class to counter the falling rate of return, to the point that now they cannot countenance any opposition and are demanding total control of every aspect of the economy, politics and the social relation in which they stand with the workers they employ, altogether taking the form of the anti-social offensive.

Article Index

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