Tackling inequality and promoting social justice will benefit the economy as a whole

Growing inequality, poor wages and the growth of low paid, part-time jobs is bad not just for individuals but for the economy as a whole and we need to find ways to address it. That was the message from the STUC Conference, “Decent Work, Dignified Lives” held on 15^th October 2014, in the middle of Challenge Poverty Week.


Grahame Smith

The role of the trade unions in tackling poverty was high on the agenda, and kicking off the conference, STUC General Secretary, Grahame Smith called for the UK and Scottish Government to recognise the legitimate role of trade unions in society. He commended the recommendations of the “Working Together Review” in Scotland, which, if implemented, could change the whole culture of trade union involvement. Chaired by Jim Mathers, with representation from trade unions, employers and academics, the review looked at ways to optimise industrial relations.

This was endorsed by the First Minister Alex Salmond who pledged to implement the key recommendations including the establishment of a Fair Work Convention, and to take steps to promote the living wage across all sectors and to support living wage accreditation schemes. He described the STUC as a partner in delivering social justice in Scotland. 
 
Grahame reminded us that this is a remarkable time in Scotland’s history.
“The referendum was a triumph for democracy, which demonstrated a thirst for political engagement not seen before. I was immensely proud of the role of the trade unions in this process. The task now is to go forward and harness this energy,” said Grahame.

He warned that we face a challenging economic climate where misleading headlines hide the stagnation of wages, stubborn levels of youth unemployment and a growth in part-time zero hours jobs.

“The UK Government’s strategy is to undermine the position of the most vulnerable in society. The STUC and the TUC warned that austerity would not work. And today’s announcement of a reduction in tax receipts despite so-called falling unemployment is exactly what we said would happen,” slammed Grahame.

Alex Salmond

Alex Salmond described a Scotland that was thriving with record breaking jobs and GDP figures, evidence, he said that political and economic confidence go hand in hand. However, he did not address the pay caps which hold down the wages of public service workers, many of them the working poor, or explain the growing numbers of children in Scotland living in poverty and the rise in the numbers of families dependent on foodbanks.

He did however outline plans to create new skilled industrial jobs as a move towards a more balanced economy, and for increased participation in the workforce to create a fairer society.

He concluded, “As the great Jimmy Reid recognised, people are the greatest asset of Scotland. We need to keep the energy generated by the referendum debate in civic life and in the economic life of Scotland.”

Karel Williams and Sukhder Johal of the Centre for Research on Socio-Cultural Change (CRESC) gave a different perspective on Scotland and warned that Scotland is more territorially divided than the rest of the UK and  inequality is greater.

Karel Williams

They presented an argument for a “foundational economy” and called for us to “dump jobs and the economy as a measure of our success, in favour of having adequate and reasonably priced supplies of key foundational goods ie basic necessities, available for everyone.”

They warned that 37% of working households in the UK receive more in benefits than they pay in tax; that the top 20% of earners get 45% of income increases whilst the bottom 20% get nothing and need to be supported by the state. They called for a “reconnection” of deprived areas with more affluent areas in the locality, and set out a package of measures, from a reinvention of taxation, to social licensing for businesses to greater social innovation.

They have begun to implement this approach in Enfield, where they havestarted to take a different approach to the delivery of services and the involvement of local business and the community.

David Bell and David Eiser from Stirling University described the impact of the widespread inequality in the UK and the growing opposition to the neo-liberal notion that inequality is good for everyone because of the “trickle down” effect. There is an acceptance now by the IMF, the ILO and the World Bank amongst others that the current levels of inequality are excessive, and impact not just on people’s health and well-being but also on their opportunities for social mobility.

They painted a pretty bleak picture of the situation in the UK and Scotland. They warned that tax and benefits will not by themselves tackle inequality and called for a wider social policy approach to the problem.


Keith Ewing

Professor Keith Ewing highlighted the dramatic fall in the numbers of UK workers covered by a collective agreement, 82% in 1978 now down to 23%.

“There is a strong correlation between high levels of inequality and low levels of collective bargaining, which is an essential lever to developing a fair and socially just society,” said Keith, warning that we were here before in the 1930s and seem to have learned nothing.

He called on the Labour Party to commit to action if they are elected, to reinstate collective bargaining as the norm, with a new agreement at government level to support collective bargaining density; a Minister and a Ministry for Labour at cabinet level to represent the interests of workers, with a role to rebuild collective bargaining machinery across all sectors.

Keith Ewing also praised the “Working Together Review” as “the most progressive document on industrial relations for some time, and an important contribution to Scotland and the UK.”

Mary Alexander from UNITE, who was part of the review, described the key elements of the proposals and said that the approach taken recognised the key importance of the trade unions in tackling inequality and taking people out of poverty.


Frances Coppola

Economist and commentator Frances Coppola spoke about the changing nature of work as Britain becomes a low wage economy and work becomes increasingly insecure through casualisation of employment. She called for a “basic income” for all to allow people to choose whether to work or not. She claimed that this would end poverty, support unpaid work and enable people to work to their skills and inclinations, thus encouraging entrepreneurialism.

There were a number of  questions for Frances as the audience tried to get their heads around how this might work in practice, and whether this would become a disincentive to work, although Frances stated that studies suggest that people want to work and to be socially useful, and that jobs do get filled.

There was then a look at employment trends in Scotland, with Stephen Boyd, STUC and Graeme Roy from the Scottish Government. Although unemployment has fallen, this is mainly on the back of a rise in part-time jobs whilst full time job numbers have not recovered.  More older people are working longer with a knock on impact for youth unemployment which is still very high. Self employment is also on the rise but that is because people are being forced into it because there is no regular work.

Stephen added, “The steepest cuts to wages, and not just in real terms, is amongst those least able to afford it. The distribution is not evenly spread. Unemployment rates are also steeper in poorer areas.”

Graeme Roy recognised many of these trends and agreed that the lowest paid suffer most and said that there is activity in Scotland to address the employment issues.

The event concluded with a Panel chaired by Dave Moxham of the STUC on social justice and enhanced devolution, where speakers from across civic society talked about their priorities for the Smith Commission. The speakers recognised that this presents opportunities but also challenges and warned that it is not about the enhanced powers but about what outcomes we want them to deliver. We must beware of unintended consequences and be rigorous in identifying all the implications of additional devolved powers.

This was a very interesting Conference but I thought that it would have benefitted from being a bit more participative and giving us the opportunity to look at how we might take some of the discussions forward in practical terms.

Click here to see the presentations in full on the STUC website

Kate Ramsden
ATUC