Tag Archives: TUC

A fairer vision for the UK: the challenge for the labour movement

29 Jan
by Frances O’Grady, General Secretary of the TUC
 

The year has started with an economic outlook as bleak as the weather. We’re stuck in the middle of what at best looks like becoming a lost decade. Jobs are being slashed across the public sector – including in services like health that we were told would be protected. And while we should be pleased unemployment hasn’t been as bad as feared, it’s still far too high, especially for young people.

The hidden problem of under-employment is growing too. Many people in part-time jobs want to work full-time, and many more workers aren’t able to use their skills and education to the full.

To make matters worse, living standards are stagnating as wages fail to keep pace with prices. Family budgets are under real pressure, particularly when you look at the soaring cost of what those on middle and low incomes actually spend their salaries on – food, childcare and transport.

The government is failing to offer a vision for the economy that works for ordinary families. Even before the recession, living standards were stagnating for the majority and the resulting unsustainable growth of credit-fuelled consumption was a key cause of the crash. There has been a long-term decline in quality, skilled, and well-paid jobs that should make up the back-bone of the labour force, as the short-term interests of banking and finance have continued to dominate the economy over the last few decades.

The labour movement has a huge challenge to make the case for a better vision, and this is going to shape my campaigning priorities over the coming months.

First we need the government to change course and abandon the austerity that is doing more harm than good. That means stopping these self-defeating spending cuts, instead putting investment in jobs and growth first.

Second we need a long-term vision of how we can build an economy that works for the many. That means leadership from the very top to drive a new industrial policy, including investment in the country’s skills and infrastructure, including affordable homes and transport. The changes we’ll need to make to respond to the challenge of climate change could be a key part of this. Banking reform needs to be stepped up too, and an effective industrial bank is needed to help us invest for the long-term.

And third, we need to build a fairer society – one where we really are all in it together. It’s no coincidence that the economic model that we’ve followed since the 1980s has led to a huge increase in the gap between the super-rich and the rest of us. Recession has only made this worse. We need to do a lot more to tackle the root causes of growing inequality.

This is why I want to see a major push for many more people to be paid the living wage in the year ahead, and a clampdown on the tax evasion and excessive tax avoidance endemic amongst corporations and the richest in society. We also need to begin a public debate about economic democracy, making the case that a fair society is also one where people have a real say in the decisions that affect their working lives and their families’ security.

Short-termism driven by runaway greed proved to be unsustainable and we can no longer entrust the best long-term interests of a company to shareholders alone. Giving workers a say over top pay through employee representation on company remuneration committees is one example. But it’s also about making all workplaces more like the best performing ones and genuinely giving staff a voice in the strategic decisions on which the future success of a company depend.

Stronger unions too must be a vital part of creating a better Britain, helping to tilt the balance of power back towards ordinary people.

I believe that when we look back at the period of deregulation and inequality from the 1980s to the crash, historians will see these as exceptional times – as damaging in their way as the 1930s. What will dismay them most is how slowly we are building a new economic model to replace the one that fell with Lehman Brothers.

This all adds up to a very different approach to the economy and it poses a challenge to all the political parties, employers and indeed unions. There is surprisingly broad consensus that we need real change. What we need now is the determination to deliver it.

 

Frances O'Grady

 

Frances O’Grady is the first female General Secretary of the TUC, which represents around 6.5 million trade union members.

Don’t let the Prime Minister repatriate workers’ rights

28 Jan

Speaking later today at a conference in Madrid, TUC General Secretary Frances O’Grady will appeal for the help of unions across Europe in persuading their governments to resist David Cameron’s attempt to ‘repatriate’ workers’ rights.

The new head of the TUC will say that if the Prime Minister gets his way over Europe, British workers, who already face the harshest anti-trade union laws in Europe, will lose out. The General Secretary’s words come after Nick Clegg expressed reservations about Cameron’s plans for the EU,  warning his coalition partner that a promise to hold a referendum on EU membership risked damaging the already weak economy. Clegg, in further signs of coalition unrest, dismissed prospects of securing a significant renegotiation around the EU and suggested Cameron should concentrate on the economy – which risks slumping into a triple-dip recession.

Speaking at the ETUC event, Frances O’Grady will say: “Last week, the British Prime Minister made a speech which you may have heard about. To some people outside the UK, the logic of his argument may not have been entirely clear.

“Like the last Conservative Prime Minister, John Major, David Cameron has a problem – not so much with Europe as with his own party. He has now promised – if re-elected in 2015 – to hold a referendum on British membership of the EU, which he says he wants to win.
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“What David Cameron is doing – if putting internal party management above the national and European interest wasn’t bad enough – is even more sinister.

“As well bringing the prospect of an unprecedented triple-dip recession even closer, the UK government is making the most vulnerable pay for a crisis they didn’t cause, and is set on a wholesale scrapping of workers’ rights.

“The government has already made it easier for employers to sack people they don’t like and more difficult for workers to get justice before the courts. Now it is trying to abolish wage protection for farm workers, and stop people injured at work getting their rightful compensation.

“But there’s one set of workers’ rights David Cameron can’t touch. Those are the rights provided for by social Europe – paid holidays, health and safety, equal treatment for part-time workers and women, protection when a business is sold off, and a voice at work.

“The Prime Minister wants to ‘repatriate’ those rights, and not because he thinks he can improve them! David Cameron wants to make it easier for bad employers to undercut good ones, drive down wages, and make people who already work some of the longest hours in Europe work even longer. To do that, he needs agreement from the rest of Europe. And when the UK government calls on your government to give him the chance to undermine British workers’ rights, we want your governments to say no. Not just out of solidarity with us, but in the interests of your own rights, your own wages, and your own jobs.

“British working people are looking to their colleagues around Europe to work with us. Trade unions are all about solidarity, about working together in the common interest. We must make common cause to defeat David Cameron’s attack on working people and Social Europe.

 

“As trade unionists, we have a crucial role to play in winning the argument for an alternative. Our focus must not just be on jobs but on good jobs that pay a decent wage, that help build sustainable demand, and that give opportunity to those who need it most. Only collective bargaining can deliver this.

“Together we must make the case for a worker’s and citizen’s Europe, not a banker’s and financier’s Europe. If the EU is only about fiscal austerity, open markets and privatisation, then ordinary Europeans will increasingly question its legitimacy – and rightly so.

“For a generation, Europe prospered by balancing the interests of business and those of workers. It’s time to rediscover that bargain – and the sense of solidarity that underpins it.”

 

Top bosses’ pension pots nearly 25 times the average

6 Sep

Directors of the UK’s top companies have built up pension pots worth an average of £4.3 million, according to the TUC’s tenth annual PensionsWatch survey published today (Thursday).

PensionsWatch, which analyses the pension arrangements of 351 directors from FTSE 100 companies, shows that the average transfer value (pension pot) for a director’s defined benefit (DB) pension has increased by £400,000 over the last year to reach £4.33 million – providing an annual pension of £240,191. The biggest pension pot in this year’s survey is worth £19.4 million.

The total value of the 144 directors’ DB pension pots analysed in PensionsWatch is a whopping £600 million.

PensionsWatch shows that the value of the average director’s pension has increased faster than most ordinary pension schemes and is now 24.4 times the size of the average occupational pension (£9,828).

The survey finds that the average company contribution to directors’ defined contribution (DC) pensions is £144,508. The average employer contribution rate to a director’s pension (as a percentage of salary) is 22 per cent. This is nearly four times the size of the average employer contribution rate (six per cent) in DC pensions. The figure is also more than seven times the size of the maximum employer contribution required under the new automatic enrolment regime that will start being phased in for all workers from next month.

An increasing number of top directors now receive cash payments instead of participating in company pension schemes. The average cash payment was £164,925, an increase of £26,489 on last year. The biggest cash payment was £818,594.

The most common Normal Retirement Age (NRA) for senior executives is 60, with three times as many directors able to retire at 60 than 65. In contrast, the most common NRA for ordinary scheme members is 65, a figure which is expected to rise further.

The ever-increasing value of directors’ pensions is in sharp contrast to the fortunes of the pensions of most ordinary workers, with the number of employees saving in employer-backed schemes falling every year.

As pensions are generally not performance-related, the TUC believes there is no case for the stark differences between the pension terms enjoyed by directors and those offered to the rest of the workforce.

Private sector companies should follow the example of the public sector, where there are no platinum-style boardroom pensions and all staff are members of the same pension scheme and enjoy the same benefits, says the TUC. Indeed in public sector schemes better paid employees pay higher percentage contributions from their pay than lower paid workers.

Executive pay and bonuses have been under close scrutiny recently, forcing the government to look into possible reforms. But the TUC report says that because of the confusing and sometimes misleading reporting of directors’ pensions, the scale of executive excess has largely escaped the attention of shareholders and the media. The TUC is calling for greater clarity in the reporting of pensions, including the mandatory disclosure of accrual and contribution rates.

The TUC wants to see a legal requirement for more comprehensive reporting on company pension provision for directors and employees in company annual reports. The government is currently consulting on revisions to remuneration reporting regulations, and changes to pensions reporting should be included as part of these reforms.

Pensions will be a hot topic at the 144th annual Congress next week, when unions will debate the acceleration of the increase in the State Pension Age (SPA), condemn attacks on the pensions of workers across the public and private sectors, and call for a restoration of trust in the pensions system by tackling hidden and excessive charges.

TUC General Secretary Brendan Barber said: “Companies continue to chip away at the pensions of ordinary workers while awarding their directors solid platinum pensions worth hundreds of thousands of pounds a year.

“Top executives already enjoy huge pay packages that go up every year irrespective of the success of their company or the state of the economy. These salaries alone guarantee lucrative pensions so the generous packages uncovered are an insult to the vast majority of workers who are denied such favourable terms.

“The gap between the pensions of top directors and everyone else does not just reflect the excess of the super-rich, but shows just how poor pensions are for ordinary workers in the private sector, where more than two out of three get no employer pension help.

“Automatic enrolment is a great advance as it will make employers contribute to pensions for the first time, but we need to see employers offering more than the bare minimum if we are to avoid a growing pensioner poverty crisis.”

PensionsWatch 2012 is available to download at http://bit.ly/TA8zLR

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