The Lib Dems' attack on workers' rights is a betrayal of their history

The tragic irony of Lloyd George’s successors pushing through regressive Conservative legislation.

You don’t have to look too hard at the record of this Conservative-led government to find examples where right-wing ideology and purblind prejudice have trumped reason and evidence in the formation of policy. Dismantling our National Health Service through financial competition, when all experts favour closer integration and collaboration, is one glaring and destructive example. Another is the crumbling foundation stone on which the government’s failing economic strategy is based: that public sector cuts will incentivise investment by the private sector. Seven hundred billion pounds of capital and assets hoarded in banks and corporate balance sheets is one evidence-based yardstick by which we might measure the margin of error of that call, though a more human scale might index the months of misery endured by the young unemployed of Britain as they wait for an upturn in our economic fortunes. However, I’m tempted to suggest that the most egregious example came yesterday, when Jo Swinson, the Liberal Democrat minister for employment relations, announced that she was cutting the minimum notice period employers have to give before making large-scale job cuts from 90 to 45 days.

This idea was first floated earlier in the year by Conservative donor Adrian Beecroft, in his slash and burn report on employment law. Beecroft infamously concluded that "employment law and regulation impedes the search for efficiency and competitiveness" and suggested that long established protections against unfair dismissal should be scrapped, parental leave and flexible working curtailed, pension rights reduced or removed altogether for employees in firms with just five workers, gangmaster licensing repealed, TUPE rules hobbled and the Agency Workers Directive dumped. Rather than recoiling from this shameful list, Tory minister Mark Prisk boasted that 17 of the 23 recommendations were already being implemented, though Vince Cable sounded a note of sanity in declaring it "complete nonsense to think that if labour rights were stripped down to the most basic minimum, employers would start hiring and the economy would soar again."

The Business Secretary pointed to evidence that Britain already has one of the most flexible labour markets in the developed world, a fact borne out by the OECD’s assessment of employment protection, which shows that British workers enjoy significantly fewer rights and statutory protections than their international counterparts.

Employment Protection in 2008 in OECD and selected non-OECD countries*

Scale from 0 (least stringent) to 6 (most restrictive)

And perhaps the Business Secretary’s influence can be seen in today’s decision to implement Beecroft’s recommendation on cutting the 90 day rule, insofar as the BIS Impact Assessment does concede that Britain has "one of the most flexible labour markets in the world according to the OECD’s employment protection index." However, Cable’s writ clearly doesn’t run too far, certainly not far enough to head off Tory-led determination to curtail workers’ rights. And thus the same Impact Assessment finds a way past the evidence to conclude (without supporting data of any kind) that "the UK performs relatively less well on the component of that (OECD) index that relates to collective redundancies and there may be room for greater flexibility here."

That greater flexibility entails making it easier and cheaper for employers to sack workers in batches of a hundred or more, by reducing the notice period, and thus the amount of time employers have to pay workers whom they intend to fire, to 45 days. This, like Beecroft’s other recommendations, is meant to "promote growth". But read the report in fine detail and you will struggle to find any empiric or even consistent anecdotal evidence to support this conclusion, as even BIS concludes the data is mixed:

Some UK employers have argued that the current regime for collective redundancy consultation is harming their competitiveness on a global level. They state that it is much quicker to restructure in other, competitor, nations, both within the EU and beyond. However, further discussion in focus groups with employers suggests this is not a universal view, and that in fact many view the process as easier in the UK than the rest of the EU.

Er, so which is it? They don’t say. But as someone who has worked for multinational companies with operations in counties across the world, I can tell them for free that everyone knows it’s far easier to lay people off here than it is in France or Germany, Belgium or Italy. In fact, as the OECD says, it’s easier here than just about anywhere apart from the US. And thus the only thing than can explain this change is not evidence, but ignorant prejudice: they think they know in their guts that British workers are a drag on our economy – amongst the most idle in the world, as another Tory publication recently described them – and that transferring yet more powers from labour to capital, from workers to corporations, will shake them up and render more dynamic our failing economy.

So, there you have it: another triumph of ideology over evidence for Tories who are determined to drive through every last post-Thatcherite prejudice they stored up and brooded on during their time out of office. For me, as a Welshman, the tragic irony of Lloyd George’s successors pushing through such regressive Tory legislation is rich indeed. Do Swinson and Cable not recall with pride that theirs was the party that first introduced unemployment insurance or the Whitley Councils on employment relations? Can they really say they are equally proud, almost a century later, to now be reducing workers' rights? The Welsh Wizard must be spinning in his Gwynedd grave.

Business Secretary Vince Cable with employment relations minister Jo Swinson. Photograph: Getty Images.

Owen Smith is a Labour leadership candidate and MP for Pontypridd. 

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The tale of Battersea power station shows how affordable housing is lost

Initially, the developers promised 636 affordable homes. Now, they have reduced the number to 386. 

It’s the most predictable trick in the big book of property development. A developer signs an agreement with a local council promising to provide a barely acceptable level of barely affordable housing, then slashes these commitments at the first, second and third signs of trouble. It’s happened all over the country, from Hastings to Cumbria. But it happens most often in London, and most recently of all at Battersea power station, the Thames landmark and long-time London ruin which I wrote about in my 2016 book, Up In Smoke: The Failed Dreams of Battersea Power Station. For decades, the power station was one of London’s most popular buildings but now it represents some of the most depressing aspects of the capital’s attempts at regeneration. Almost in shame, the building itself has started to disappear from view behind a curtain of ugly gold-and-glass apartments aimed squarely at the international rich. The Battersea power station development is costing around £9bn. There will be around 4,200 flats, an office for Apple and a new Tube station. But only 386 of the new flats will be considered affordable

What makes the Battersea power station development worse is the developer’s argument for why there are so few affordable homes, which runs something like this. The bottom is falling out of the luxury homes market because too many are being built, which means developers can no longer afford to build the sort of homes that people actually want. It’s yet another sign of the failure of the housing market to provide what is most needed. But it also highlights the delusion of politicians who still seem to believe that property developers are going to provide the answers to one of the most pressing problems in politics.

A Malaysian consortium acquired the power station in 2012 and initially promised to build 517 affordable units, which then rose to 636. This was pretty meagre, but with four developers having already failed to develop the site, it was enough to satisfy Wandsworth council. By the time I wrote Up In Smoke, this had been reduced back to 565 units – around 15 per cent of the total number of new flats. Now the developers want to build only 386 affordable homes – around 9 per cent of the final residential offering, which includes expensive flats bought by the likes of Sting and Bear Grylls. 

The developers say this is because of escalating costs and the technical challenges of restoring the power station – but it’s also the case that the entire Nine Elms area between Battersea and Vauxhall is experiencing a glut of similar property, which is driving down prices. They want to focus instead on paying for the new Northern Line extension that joins the power station to Kennington. The slashing of affordable housing can be done without need for a new planning application or public consultation by using a “deed of variation”. It also means Mayor Sadiq Khan can’t do much more than write to Wandsworth urging the council to reject the new scheme. There’s little chance of that. Conservative Wandsworth has been committed to a developer-led solution to the power station for three decades and in that time has perfected the art of rolling over, despite several excruciating, and occasionally hilarious, disappointments.

The Battersea power station situation also highlights the sophistry developers will use to excuse any decision. When I interviewed Rob Tincknell, the developer’s chief executive, in 2014, he boasted it was the developer’s commitment to paying for the Northern Line extension (NLE) that was allowing the already limited amount of affordable housing to be built in the first place. Without the NLE, he insisted, they would never be able to build this number of affordable units. “The important point to note is that the NLE project allows the development density in the district of Nine Elms to nearly double,” he said. “Therefore, without the NLE the density at Battersea would be about half and even if there was a higher level of affordable, say 30 per cent, it would be a percentage of a lower figure and therefore the city wouldn’t get any more affordable than they do now.”

Now the argument is reversed. Because the developer has to pay for the transport infrastructure, they can’t afford to build as much affordable housing. Smart hey?

It’s not entirely hopeless. Wandsworth may yet reject the plan, while the developers say they hope to restore the missing 250 units at the end of the build.

But I wouldn’t hold your breath.

This is a version of a blog post which originally appeared here.

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