Labour promises "action" on zero-hours contracts - its supporters want a ban

One challenge facing Miliband is that many would like him to back more radical solutions to the problems the party is highlighting than he is prepared to support.

After the shadow cabinet's alleged summer slumber, Chuka Umunna is busily touring the studios this morning attacking the growth of zero-hours contracts. As he has noted, figures from the ONS (collated by the Resolution Foundation) show that employees on these contracts, which offer no guaranteed work and require workers to be permanently on-call, are paid 40% less than others. In addition, the Chartered Institute of Personnel and Development estimated earlier this month that up to a million workers could be employed on them, four times larger than the most recent ONS figure of 250,000. 

Later today, Umunna will host a summit on the issue with representatives of employers and employees, including the CBI, the TUC, the British Retail Consortium (BRC), the British Chamber of Commerce, the Local Government Association and Unison, the TSSA, the GMB, the CWU and the NUT (Unite is a curious omission). He said:

David Cameron says he's fixed the economy, but for hard working families things are getting harder not easier. For too many things have become more difficult and less secure as they face a cost of living crisis in David Cameron’s Britain.

New evidence highlights that there could be hundreds of thousands more people on zero-hours contracts than previously thought. That’s hundreds of thousands of people in insecure work earning far less than average pay. Flexibility works for some, but the danger today is that too often insecurity at work becomes the norm.

The huge spike in the use of zero-hours contracts has brought increased reports of abuses and bad practice. There should be zero tolerance of such abuse. That is why Labour has convened this important summit bringing together representatives of employers and employers to consider what action must be taken. In contrast, this Tory-led government has refused to have a proper and full consultation on the rise of zero-hours contracts or to treat this issue with the seriousness which it deserves.

Labour has previously said that it is "determined to stamp out abuse of zero-hours contracts" and is "looking at how to do so" as part of its policy review. The phrase "abuse of" suggests that it recognises that the contracts do have some benefits. As Vidhya Alakeson of the Resolution Foundation recently noted, "If you want to combine work with studying or childcare then you can juggle things around more easily." Nicola Smith, the TUC's head of economic and social affairs, has similarly suggested that an "outright ban" would be a mistake and that the "the vast majority" of employers (including Labour councils) do not use them in an exploitative fashion. 

But it's worth noting that many in Labour would like it to pledge to abolish them. In a notable piece of policy freelancing earlier this year, Andy Burnham said: "A living wage could really help to address that and I would say to Ed, personally, go further and ban things like zero-hours contracts. That is a Labour response to the debate about work and benefits." Labour MP Andy Sawford has attracted significant support for his Private Members' Bill to scrap the contracts. And the voters are on his side. A YouGov poll in August found that 56% of people (including 71% of Labour voters) "support a ban on zero-hour contracts", with just 25% opposed. 

One challenge that Miliband faces is that many in Labour would like more radical solutions to the problems the party is highlighting, such as low pay and insecure work, than he is prepared to support. Rather than increasing voluntary use of the living wage, for instance, most party activists would prefer him to introduce it on a statutory basis. But Miliband, aware that studies suggest this would cost around 150,000 jobs, will almost certainly not pledge to do so.

The Labour leader's mantra is "radicalism and credibility". Unless Labour offers a distinct alternative to the Tories, voters will see little reason to support it, but unless it is also viewed as a responsible opposition it won't be trusted with power. Whether or not the party wins a majority in 2015 will depend on him perfecting this balance. 

Shadow business secretary Chuka Umunna speaks at last year's Labour conference in Manchester. Photograph: Getty Images.

George Eaton is political editor of the New Statesman.

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Theresa May's Article 50 letter fires the Brexit starting gun

But as well as handing over a letter, Theresa May hands over control of the process. 

So the starting gun will be fired, and the Brexit process will begin. The delivery of the letter from Theresa May to Donald Tusk is a highly symbolic moment. It is also, crucially, the moment when the Prime Minister loses control of the process.

Perhaps the most striking thing about the Brexit process to date has been the remarkable degree of control exercised over it by Downing Street. Brexit means Brexit, declared the Prime Minister, and since that day it has been her who has defined what precisely it does mean. After a quarter century of bitter division over Europe, culminating in a referendum where the Parliamentary party was split down the middle, she has managed to unite the overwhelming majority of the Conservative party for a “hard Brexit” that very few claimed to support a year ago.  As an impotent opposition and ineffective Tory opponents watched on, she has made it clear from the first that Britain will leave the single market and, almost certainly, the customs union. Rumours from Whitehall suggest that, whatever the concerns or doubts of line departments, these have been ignored or over-ruled.

Now, however, the Prime Minister has lost control of the process. Inevitably, given the relative strength of the parties’ negotiating positions, both the agenda and outcome of the talks will be determined largely by our European partners. It is of course true that they have an interest in preserving trade with us, as do we with them; nor do they have any interest, either economic or political, in “punishing” us for the sake of it. That being said, our interests and theirs are far from aligned. They have other priorities. Not allowing cherry picking among EU rules is one. Ensuring Britain pays its fair share is another.

And, while it is in neither side’s interest for the talks to collapse, we have considerably more to lose. May’s claim that “no deal is better than a bad deal” may play well with the Daily Express, but is has not gone down well with UK business. As the economics professor Jonathan Portes sets out here, the consequences of “no deal” would go far beyond the mere imposition of tariffs; the economic impacts would be significant for other EU countries, and very  severe indeed for the UK.  There are increasing signs that ministers are, belatedly, appreciating the risks, and are anxious to avoid such an outcome.

So both sides want a deal – and the UK, at least, needs one. But several hurdles stand in the way. In the first place, there is the vexed question of money. Britain, as our partners are concerned, has outstanding liabilities that must be paid. The British government may accept some of these, but is sure to quibble about the sums. Discussions of money are never easy in the EU, and the task of figuring out what a net contributor to the budget might owe at a time when discussions over the new 5 year funding programme are about to start will be no exception.  Nevertheless, if it were simply left to the civil servants, no doubt an acceptable compromise would be reached. The bigger  issue  is whether Mrs May  is prepared to take on some of her own backbenchers – and, more importantly, sections of the UK press – to sell a deal that will inevitably mean that the UK writes a sizeable cheque.

Second, there is the question of how to ensure the "frictionless" trade of which the Prime Minister has spoken. This makes eminent sense on one level – why make trade more difficult with the partner that buys 44 per cent of our exports? On another, though, it is hard to see how she can deliver.

I for one simply lack the imagination to see how we can be sufficiently out of the customs union to allow us to sign our own trade deals, while sufficiently in it to avoid customs checks and tariffs. For another, it is difficult to foresee conditions under which the EU would allow us to enjoy any of the benefits of the single market – whereby states accept each other’s rules and standards – without the oversight provided by the European Court of Justice.

And finally, since all parties now seem to accept that the prospects of concluding an “ambitious and comprensive” trade deal by March 2019 are vanishingly, there is the question of what happens then. The government has talked about an “implementation phase”; but how do you have an “implementation phase” when you do not know exactly what you are trying to implement?

It could just be me. I may simply not have fathomed the subtle devices that might allow these circles to be squared. But it does seem clear to me that doing so would be far from straightforward.

And then, of course, whatever is negotiated needs to be approved. Forget for a moment the continent, where there has probably never been a worse time to try to get a free trade deal approved by 27 European parliaments. The Prime Minister will almost certainly have parliamentary problems here in the UK.

The Labour party has adopted a position whereby they will vote against any deal that does not provide the “exact same benefits” as we currently have as members of the single market and customs union,” to quote Keir Starmer. If the other member states are to be believed, the full benefits of membership are, and will be, only available to members, so this is will simply not be the case.

Labour, then, will probably end up voting against the bill. What Tories opposed to either Brexit or to leaving the single market might then do is anyone’s guess. It may be that, by autumn of 2018, they feel sufficiently empowered  - either because of a shift in public opinion, or because of indications of falling economic confidence, or, conceivably, because of declining faith in the Prime Minster – to make common cause with the opposition.

Under such circumstances, May might face the real possibility of defeat in Parliament. Which in turn poses the question as to why she would she risk putting a deal that might be rejected to a vote?

It seems to me that she would have very little incentive to do so. If she cannot get the kind of deal that seems, on the surface, impossible to get anyway, surely better, from her point of view to simply walk away? Blaming the Europeans for failure would be all to easy. And holding a snap election on a patriotic ticket and opposed by the current Labour party would guarantee a healthy majority.

Two years is a long time in politics. And much that is unexpected will doubtless transpire during the negotiations to come. Do not, however, discount the possibility that it might all go wrong. 

Anand Menon is director of The UK in a Changing Europe and professor of European politics and foreign affairs at King's College London.