Britain has experienced the most profound economic crisis since the 1930s. Despite tentative signs of the „green shoots‟ of recovery experienced under the previous government, the economic programme of the Con/Dem coalition government means that thousands of workers could lose their jobs and the well-being of families placed at risk. There is also the possibility of a double-dip recession putting industry and jobs at further risk.
For those still in work, the recession has brought with it not just increased job insecurity, but a whole range of additional pressures. A recent report by the Chartered Institute for Personnel and Development (CIPD) found that over a third of employees were worried about being made redundant; half said they were „worried about the future‟; 70 per cent reported that job cuts had hit staff morale; and just over half reported that following redundancies in their workplaces they felt under increased pressure to perform and „prove their worth’.
The Budget in June got the big judgement about the economy wrong. With the economy still fragile, the measures announced in the Budget will certainly slow recovery and could well stop it in its tracks.
Spending and benefit cuts, together with the VAT increase, will take much needed spending power out of the economy. The private sector has been hit as hard as the public sector today.
Nor does the Budget live up to any claim to be fair. The unexpectedly big cuts in benefits will hit not just the poor but middle income families too. Unemployment will continue to be high, and anyone leaving school or college in the next five years faces a bleak future.
The rich have largely been let off. They will hardly notice the VAT increase. The bank levy is less than half the £5-8 billion predicted - and is a fraction of city bonuses. The capital gains tax (CGT) increase is full of loopholes, and won't stop tax dodging.
Some of the really bad news is yet to come with the Comprehensive Spending Review in October. Unprotected government departmental budgets will be savaged. Local government will need to slash services if they are to freeze council tax. Public servants did nothing to cause the slump but are being asked to bear an unfair share of the burden.
A wage freeze when inflation is high is a real cut in living standards - and the small concession for the low paid is still less than inflation. The coalition government‟s budget was economically dangerous and socially divisive. The one thing we can now say is that we are very definitely not all in this together. Those on middle and low incomes have done worse than expected, and the rich have been let off much of what they feared. But we will all suffer from an economy that is now likely to be sluggish at best, and with a double-dip recession, at worst.'
To face these challenges, unions will need to reverse long-term declines in union membership and collective bargaining coverage. Union density and membership peaked in 1978 and 1979 respectively. In the following two decades to 1998, union membership fell every single year – from a high of 12.6 million to 7.1 million. Union density experienced a similar decline from a high of 56.1 per cent to 27 per cent. Since 1998 – due in part to improvements in the framework of employment legislation, including statutory trade union recognition – total union membership has remained broadly stable. In addition, the decline in density during this period has been „shallower‟ than that experienced in the preceding two decades and has been predominately a function of a growing workforce rather than union decline.
However, collective bargaining coverage continues to fall. Fewer than 1 in 5 private sector workers are covered by collective bargaining – across the economy only 1 in 3 workers is covered by a collective agreement. Anti-trade union legislation continues to hamper the work of trade unions in obtaining for working people a fairer share of the national wealth.
Following the 2010 election the legal climate could become even more weighted against working people, with some employers appearing to prefer injunction to negotiation, and business groups calling for unions to jump ever higher hurdles to achieve employer recognition and secure an industrial action ballot. Any changes to existing union voting requirements would be anti-democratic and if they ever applied to our electoral system, no elected Government in modern history would have ever assumed office.
The trades union council movement must be prepared and ready for those who want to demonise trade unionism, demoralise trade unionists and encourage disunity.
As trades union councils and their affiliated unions campaign against socially divisive and economically counter-productive cuts in the public sector - as we defend the jobs, pay and pensions of dedicated public servants who are being made to suffer for the bankers' recession, and defend the services that millions of people rely upon - we must not lose sight of the central organising challenge we face, that is rebuilding our presence in the private sector.