Vince: minister for almost being on the left

The Business Secretary's review of "zero-hours" contracts is hardly distinguishable from Labour policy.

A couple of newspapers have today reported that Vince Cable wants a review of "zero-hours" contracts – a system accused by trade unions (among others) of being exploitative.

Around 200,000 British workers are estimated to be tied into these deals, especially in the fast food and other high street retail sectors, which require a commitment to be available for work without any guarantee of shifts. In other words, you can be on call enough to make it hard to look for or do another job and yet get to the end of the week with barely a penny to show for it.

The TUC has welcomed the new review. It isn’t often that union leaders have kind words for coalition ministers, but then again, this is Vince, Secretary of State for tantalising proximity to the left. The terms of Cable’s investigation aren’t all that different from official Labour policy, which is also to review zero-hours contracts, tighten rules and and clamp down on abuses.

Shadow health secretary Andy Burnham recently told the BBC his party should look at banning the practice (which has its own specific and pernicious impact in the NHS) but Labour sources today confirm that a ban is not the official line. The reservation comes from recognition that at least some employees like the flexibility of a zero-hours deal.

The Business Secretary has also clearly picked up that ambivalence. In parliament today, Cable’s response to a Labour question on zero-hours deals was markedly more neutral than this morning’s newspaper briefings. He would not be drawn on whether they represented healthy flexibility or mean exploitation:

"We do indeed have anecdotes about abusive practices in that area. We also have a lot of other anecdotes to show that the system works very well for a large number of workers and companies. I am not jumping to any conclusions; I am just trying to gather the facts."

Labour people I have spoken to are pointing to that as a retreat from the tougher-sounding headlines. They are keen to raise the question of whether Cable’s intervention represents a new government position or an out-riding Lib Dem position within government – the two aren’t necessarily the same thing. Reviews can be commissioned and come to nought. Recommendations can be implemented or ignored or, indeed, shelved with a view to being inserted in a future party manifesto.

On which subject, some Lib Dems are increasingly of the view that the party can and should show a little more flexibility on economic policy so as not to preclude any future partnership with Labour by marching too briskly to the beat of a Conservative drum. Such "equidistance" has become much more plausible now that Ed Balls has accepted the broad fiscal parameters of austerity into the next parliament. The big argument is shifting away from the question of whether the time is right to impose budget discipline (where the Lib Dems and the Tories are locked in consensus) to questions of how to impose discipline in a way that is fair and protects public services (where there is more room for Lib Dem flirting with the opposition).

Crucial to that conversation will be an argument about the appropriate balance between tax rises and spending cuts and in that debate I gather there is a movement afoot in the Lib Dem ranks to move the party much closer to Labour by supporting a restoration of the top 50p tax rate. There is even talk of formalising that position as early as this year’s annual conference. (Labour has yet to commit to doing the same but, given the fuss the two Eds have made about tax cuts for millionaires, it seems unlikely they will fight an election accepting Osborne’s gift to the rich as a fait accompli.) Labour, meanwhile, has already embraced the mansion tax – a policy very close to Lib Dem hearts.

If Labour has a mansion tax in its manifesto and the Lib Dems have a top rate of 50p and both are committed to cracking down on zero-hours contracts, the first morning of coalition negotiations in a hung parliament will break for an early lunch. 

Business Secretary Vince Cable arrives at 10 Downing Street on May 20, 2010. Photograph: Getty Images.

Rafael Behr is political columnist at the Guardian and former political editor of the New Statesman

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Trade unions must change or face permanent decline

Union membership will fall below one in five employees by 2030 unless current trends are reversed. 

The future should be full of potential for trade unions. Four in five people in Great Britain think that trade unions are “essential” to protect workers’ interests. Public concerns about low pay have soared to record levels over recent years. And, after almost disappearing from view, there is now a resurgent debate about the quality and dignity of work in today’s Britain.

Yet, as things stand, none of these currents are likely to reverse long-term decline. Membership has fallen by almost half since the late 1970s and at the same time the number of people in work has risen by a quarter. Unions are heavily skewed towards the public sector, older workers and middle-to-high earners. Overall, membership is now just under 25 per cent of all employees, however in the private sector it falls to 14 per cent nationally and 10 per cent in London. Less than 1 in 10 of the lowest paid are members. Across large swathes of our economy unions are near invisible.

The reasons are complex and deep-rooted — sweeping industrial change, anti-union legislation, shifts in social attitudes and the rise of precarious work to name a few — but the upshot is plain to see. Looking at the past 15 years, membership has fallen from 30 per cent in 2000 to 25 per cent in 2015. As the TUC have said, we are now into a 2nd generation of “never members”, millions of young people are entering the jobs market without even a passing thought about joining a union. Above all, demographics are taking their toll: baby boomers are retiring; millennials aren’t signing up.

This is a structural problem for the union movement because if fewer young workers join then it’s a rock-solid bet that fewer of their peers will sign-up in later life — setting in train a further wave of decline in membership figures in the decades ahead. As older workers, who came of age in the 1970s when trade unions were at their most dominant, retire and are replaced with fewer newcomers, union membership will fall. The question is: by how much?

The chart below sets out our analysis of trends in membership over the 20 years for which detailed membership data is available (the thick lines) and a fifteen year projection period (the dotted lines). The filled-in dots show where membership is today and the white-filled dots show our projection for 2030. Those born in the 1950s were the last cohort to see similar membership rates to their predecessors.

 

Our projections (the white-filled dots) are based on the assumption that changes in membership in the coming years simply track the path that previous cohorts took at the same age. For example, the cohort born in the late 1980s saw a 50 per cent increase in union membership as they moved from their early to late twenties. We have assumed that the same percentage increase in membership will occur over the coming decade among those born in the late 1990s.

This may turn out to be a highly optimistic assumption. Further fragmentation in the nature of work or prolonged austerity, for example, could curtail the familiar big rise in membership rates as people pass through their twenties. Against this, it could be argued that a greater proportion of young people spending longer in education might simply be delaying the age at which union membership rises, resulting in sharper growth among those in their late twenties in the future. However, to date this simply hasn’t happened. Membership rates for those in their late twenties have fallen steadily: they stand at 19 per cent among today’s 26–30 year olds compared to 23 per cent a decade ago, and 29 per cent two decades ago.

All told our overall projection is that just under 20 per cent of employees will be in a union by 2030. Think of this as a rough indication of where the union movement will be in 15 years’ time if history repeats itself. To be clear, this doesn’t signify union membership suddenly going over a cliff; it just points to steady, continual decline. If accurate, it would mean that by 2030 the share of trade unionists would have fallen by a third since the turn of the century.

Let’s hope that this outlook brings home the urgency of acting to address this generational challenge. It should spark far-reaching debate about what the next chapter of pro-worker organisation should look like. Some of this thinking is starting to happen inside our own union movement. But it needs to come from outside of the union world too: there is likely to be a need for a more diverse set of institutions experimenting with new ways of supporting those in exposed parts of the workforce. There’s no shortage of examples from the US — a country whose union movement faces an even more acute challenge than ours — of how to innovate on behalf of workers.

It’s not written in the stars that these gloomy projections will come to pass. They are there to be acted on. But if the voices of union conservatism prevail — and the offer to millennials is more of the same — no-one should be at all surprised about where this ends up.

This post originally appeared on Gavin Kelly's blog