Public sector workers striking. Photo: Getty
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Frozen out of the recovery: 2,245 reasons why public sector workers are on strike today

The TUC’s calculation that public sector workers are on average £2,245 worse off in real terms since this government came to power is timely, and explains today's strikes.

The TUC’s calculation that public sector workers are on average £2,245 worse off in real terms since this government came to power is timely, published yesterday, a day ahead of the largest strike action to take place since 2010. The TUC highlights how the people affected by continued pay restraint – the home helps, refuse collectors, teachers and firefighters, among others – are often the public servants on whom we depend on most. These people are currently facing the prospect of another four years with pay rises significantly lower than the increase in the cost of living.

Just under half a million public sector workers are paid below the living wage. It was pointed out to me recently that some of these lowest paid workers might effectively lose more than the equivalent of the 1 per cent pay rise being offered if they go on strike. The implicit argument was that it would be better to put up with, what by 2018 will be over a decade of falling wages, than fight back. There comes a point, however, when gratitude that you have a job is outweighed by a sense that fairness ought also to be included in the mix. This is unsustainable. There is a limit to how long people can make do, juggling bills and food costs and getting by with rising rents and the threat of increased mortgage rates. Industrial action among unionised workers is sometimes an almost inevitable and entirely justified last resort.

A government that tells us "we are all in it together" when we can all accept things are truly tough needs to recognise the implied contract that everyone will benefit when things – as they tell us they are – start to improve. This is not happening. Public sector workers are being frozen out of the recovery in a high-handed manner that understandably breeds frustration and disillusionment.

This government has done little to help those on low pay. In work poverty is on the increase and we know many of those who resort to emergency aid from food banks are from working households. The voluntary approach to the living wage is currently failing and will only work if ministers and Mayors literally put their money where their mouths are. The Brixton Ritzy cinema workers, who will also be on strike tomorrow, are a case in point. If employees are told that if their employer can afford to pay a living wage, they should, will at some point stop asking politely. Equally, if Scotland and Northern Ireland can negotiate to resolve their fire pensions dispute, it is hardly surprising that the Fire Brigades Union believes the Westminster government should follow suit, and therefore escalate their action accordingly when it refuses.

At the other end of the scale, high paid executives apparently need to be rewarded to ensure they do their jobs, and we are not seeing the kind of restraint that Mark Carney, Governor of the Bank of England, has urged banks to adopt. The High Pay Centre, an independent think tank on pay inequality, calculate that today the average salary of a FTSE 100 chief executive so far this year is £2,208,829 and that a CEO at this level will take home more in three days than an employee earns in a year. To these people – and seemingly to the government – £2,245 is neither here nor there.

Strikes are always a last resort and, with individual strikes getting limited publicity, it is hardly surprising that trade unions are choosing to call co-ordinated action. Trade unions are there to defend their members and there are 2,245 reasons for a strike to take place now.

Fiona Twycross is the London Assembly Labour Group economy spokesperson

Photo: Getty Images
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Autumn Statement 2015: George Osborne abandons his target

How will George Osborne close the deficit after his U-Turns? Answer: he won't, of course. 

“Good governments U-Turn, and U-Turn frequently.” That’s Andrew Adonis’ maxim, and George Osborne borrowed heavily from him today, delivering two big U-Turns, on tax credits and on police funding. There will be no cuts to tax credits or to the police.

The Office for Budget Responsibility estimates that, in total, the government gave away £6.2 billion next year, more than half of which is the reverse to tax credits.

Osborne claims that he will still deliver his planned £12bn reduction in welfare. But, as I’ve written before, without cutting tax credits, it’s difficult to see how you can get £12bn out of the welfare bill. Here’s the OBR’s chart of welfare spending:

The government has already promised to protect child benefit and pension spending – in fact, it actually increased pensioner spending today. So all that’s left is tax credits. If the government is not going to cut them, where’s the £12bn come from?

A bit of clever accounting today got Osborne out of his hole. The Universal Credit, once it comes in in full, will replace tax credits anyway, allowing him to describe his U-Turn as a delay, not a full retreat. But the reality – as the Treasury has admitted privately for some time – is that the Universal Credit will never be wholly implemented. The pilot schemes – one of which, in Hammersmith, I have visited myself – are little more than Potemkin set-ups. Iain Duncan Smith’s Universal Credit will never be rolled out in full. The savings from switching from tax credits to Universal Credit will never materialise.

The £12bn is smaller, too, than it was this time last week. Instead of cutting £12bn from the welfare budget by 2017-8, the government will instead cut £12bn by the end of the parliament – a much smaller task.

That’s not to say that the cuts to departmental spending and welfare will be painless – far from it. Employment Support Allowance – what used to be called incapacity benefit and severe disablement benefit – will be cut down to the level of Jobseekers’ Allowance, while the government will erect further hurdles to claimants. Cuts to departmental spending will mean a further reduction in the numbers of public sector workers.  But it will be some way short of the reductions in welfare spending required to hit Osborne’s deficit reduction timetable.

So, where’s the money coming from? The answer is nowhere. What we'll instead get is five more years of the same: increasing household debt, austerity largely concentrated on the poorest, and yet more borrowing. As the last five years proved, the Conservatives don’t need to close the deficit to be re-elected. In fact, it may be that having the need to “finish the job” as a stick to beat Labour with actually helped the Tories in May. They have neither an economic imperative nor a political one to close the deficit. 

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