How Ed should handle McCluskey

Miliband should condemn McCluskey's Olympics threat but he can't "rein him in".

On one level, Unite leader Len McCluskey's threat to disrupt the Olympics is unsurprising. If you oppose all of the cuts (as McCluskey does), why not strike at the moment of maximum inconvenience? The trade union head tells the Guardian:

The attacks that are being launched on public-sector workers at the moment are so deep and ideological that the idea the world should arrive in London and have these wonderful Olympic Games as though everything is nice and rosy in the garden is unthinkable.

It's important to note, as few have, that this was not an unprompted intervention. McCluskey was asked by the paper if he had "talked about" the possibility of strike action during the Olympics and it's unsurprising, at this stage, that he's not willing to take any options off the table. That is standard negotiating practice.

What make his intervention significant is his standing in the labour movement. As general secretary of Unite he leads the country's biggest trade union and Labour's biggest donor, responsible for a quarter of all donations to the party. And, lest we forget, had it not been for his union, among others, David Miliband, not Ed, would now be wearing the crown.

Nick Clegg, a long-standing critic of the unions, has already called on Ed Miliband to "rein in" McCluskey, something that is neither possible nor desirable for the Labour leader to do. As the democratically-elected head of a trade union, McCluskey should answer to no one but his members.

What Miliband can and should do is simply condemn the Unite leader. Unlike Tony Blair, Miliband has never sought to define himself by picking fights with his own party. But that doesn't mean that he shouldn't respond when union leaders speak out.

Tessa Jowell, Labour's shadow Olympics minister, has already issued an unambiguous statement:

No one in our country looking forward to the Olympics, no athlete preparing, and none of our thousands of potential visitors, would understand or sympathise with any disruption to the Olympic Games.

If this is a negotiation it should take place in private. Unions and employers should get together and sort it out without threats or disruption to Britain's Olympics.

Those who say that Miliband cannot afford to alienate Unite, his party's biggest paymaster, should remember that, even at the height of Blairism, the unions continued to pay the bills.

George Eaton is political editor of the New Statesman.

Photo: Getty Images
Show Hide image

How can Britain become a nation of homeowners?

David Cameron must unlock the spirit of his postwar predecessors to get the housing market back on track. 

In the 1955 election, Anthony Eden described turning Britain into a “property-owning democracy” as his – and by extension, the Conservative Party’s – overarching mission.

60 years later, what’s changed? Then, as now, an Old Etonian sits in Downing Street. Then, as now, Labour are badly riven between left and right, with their last stay in government widely believed – by their activists at least – to have been a disappointment. Then as now, few commentators seriously believe the Tories will be out of power any time soon.

But as for a property-owning democracy? That’s going less well.

When Eden won in 1955, around a third of people owned their own homes. By the time the Conservative government gave way to Harold Wilson in 1964, 42 per cent of households were owner-occupiers.

That kicked off a long period – from the mid-50s right until the fall of the Berlin Wall – in which home ownership increased, before staying roughly flat at 70 per cent of the population from 1991 to 2001.

But over the course of the next decade, for the first time in over a hundred years, the proportion of owner-occupiers went to into reverse. Just 64 percent of households were owner-occupier in 2011. No-one seriously believes that number will have gone anywhere other than down by the time of the next census in 2021. Most troublingly, in London – which, for the most part, gives us a fairly accurate idea of what the demographics of Britain as a whole will be in 30 years’ time – more than half of households are now renters.

What’s gone wrong?

In short, property prices have shot out of reach of increasing numbers of people. The British housing market increasingly gets a failing grade at “Social Contract 101”: could someone, without a backstop of parental or family capital, entering the workforce today, working full-time, seriously hope to retire in 50 years in their own home with their mortgage paid off?

It’s useful to compare and contrast the policy levers of those two Old Etonians, Eden and Cameron. Cameron, so far, has favoured demand-side solutions: Help to Buy and the new Help to Buy ISA.

To take the second, newer of those two policy innovations first: the Help to Buy ISA. Does it work?

Well, if you are a pre-existing saver – you can’t use the Help to Buy ISA for another tax year. And you have to stop putting money into any existing ISAs. So anyone putting a little aside at the moment – not going to feel the benefit of a Help to Buy ISA.

And anyone solely reliant on a Help to Buy ISA – the most you can benefit from, if you are single, it is an extra three grand from the government. This is not going to shift any houses any time soon.

What it is is a bung for the only working-age demographic to have done well out of the Coalition: dual-earner couples with no children earning above average income.

What about Help to Buy itself? At the margins, Help to Buy is helping some people achieve completions – while driving up the big disincentive to home ownership in the shape of prices – and creating sub-prime style risks for the taxpayer in future.

Eden, in contrast, preferred supply-side policies: his government, like every peacetime government from Baldwin until Thatcher’s it was a housebuilding government.

Why are house prices so high? Because there aren’t enough of them. The sector is over-regulated, underprovided, there isn’t enough housing either for social lets or for buyers. And until today’s Conservatives rediscover the spirit of Eden, that is unlikely to change.

I was at a Conservative party fringe (I was on the far left, both in terms of seating and politics).This is what I said, minus the ums, the ahs, and the moment my screensaver kicked in.

Stephen Bush is editor of the Staggers, the New Statesman’s political blog.