“What we had between the 2008 crash and the pandemic was a direct transfer of income and wealth away from working people to the richest and to the large corporations. Has any of that really changed since covid and the war in Ukraine?”Jon Trickett MP
By Sam Browse, Arise Festival
Last night, hundreds gathered online for the Labour Assembly Against Austerity’s pre-budget briefing entitled ‘Investment not cuts – the people’s budget we need’.
The first speaker, Jon Trickett MP, set the framework for interpreting the Spring budget, saying ‘before covid and before the war, from the 2008 crash to the pandemic, the wealth of the richest 1000 people increased by £538bn. The stock exchange increased by £2 trillion. Meanwhile wages for working people fell by just under £450bn. What we had was a direct transfer of income and wealth away from working people to the richest and to the large corporations.’
“That wasn’t an accident that happened during the austerity years; it’s how our system works. Has any of that really changed since Covid and the war?”
“The profits of the FTSE 350 almost doubled in a six month period during the Covid crisis. What we have is unobtainable price rises for the many imposed by powerful corporations on the one hand, and soaring profits for a few on the other.”
Setting out what this means in practical terms for her members, Sarah Woolley, General Secretary of the Bakers and Allied Food Workers Union, said “wages, terms and conditions are being pushed further and further down – paid breaks being taken away, overtime reduced, differentials between grades eroded, and the minimum wage becoming more of a reality for many of them who for years championed the fact they were a more than minimum wage employer.”
“And then add to that the cuts to our NHS, benefits, public services, education and local councils, and public transport. Foodbanks are becoming a regular occurrence for those who weren’t surviving back in 2021 before the cost of living crisis started, never mind now.”
“Millions of pounds can be found when it’s needed for a failed track and trace system through Covid, but heaven forbid that we want workers to be paid decent wages or a reduction in utility bills, or an increase to benefits that could mean that people who can’t work are able to put the heating on and have that support through winter.”
Fran Heathcote, of the PCS union, likewise described the effects of the cost of living crisis on her members and explained the reasons behind their historic mandate for strike action. Tackling the misperception of civil servants, she said “this government treats its own workers absolutely appallingly. There’s a media perception of civil servants as bowler-hatted bureaucrats, drinking tea, sitting around, earning a lot of money, and not really doing much. But during the pandemic, at a time of national crisis, our members put their own safety at risk an made sure that we can provide the essential services that the public rely on. And the reward for keeping those services running, and all the hard work and dedication, was an attack on our living standards.”
She told the audience that “40,000 PCS members are currently using a foodbank; 40% of those processing universal credit or other low income benefits, are also in receipts of it because their pay is so low; and 46,000 PCS members in just the DWP and HMRC will have an enforced pay increase because for the first time their pay has fallen below the national minimum wage. That’s a far cry from the perception of civil servants.”
Donna Guthrie, Women’s Officer of Black Activists rising Against the Cuts UK, highlighted the disproportionate impact of cuts to Black communities – “amplifying racism, with black people facing increased inequality in housing, employment, health, income, and also targeted viciously with racist immigration controls under the government’s hostile environment.”
She described the toll on women and women’s services which had been “hammered by austerity.”
“Black women have been impacted more so, often concentrated in low paid, part-time, and temporary work, hardest hit by austerity and now with a cost of living crisis unable to afford huge price rises.”
She continued, “the covid pandemic exposed the racial inequalities in society. Black and brown workers were clapped for keeping the economy going through the pandemic, but actually some black workers face the hostile environment of immigration controls so much so that they’re the victims of the Windrush scandal, mismanaged compensation schemes, and continued attacks on our position in the UK.”
Speaking as MP’s debated the Illegal Migration Bill – legislation that would see people who travel to the UK to claim refuge via irregular routes criminalised and their asylum claims automatically rejected – she said “we must shout loud and clear that refugees are welcome here.”
Finally, Professor Ozlem Onaran of Greenwich University, debunked the myth of the “wage-price spiral” pointing to the real terms decline in wages since the 2008 crash.
“As of December if we compare where public sector pay compared to 2010 before the coalition, public sectors workers are about 5% poorer in terms of their purchasing power.”
She said, “this new budget has been dubbed a “back to work” budget, but in reality it is a class war budget.”
Citing the example of public sector pay, she argued that “to fully fund the increase in nurses, teachers and civil servants’ well-deserved pay rise and to cover for the past losses in their real pay – but also really to correct a very undervalued pay in the public sector – we need to raise the tax rates. It’s a very simple political economy question: who should pay for the tax increases such that the value of the very socially important work that the nurses, the doctors, the teachers, the civil servants are doing? Which tax rates should be increased?”
“Of course, if we do accept the pay demands of the junior what would be the signal effect of such a public sector pay raise on the private sector wage negotiations, and how will it affect the profit margins of the private firms who have been profiteering from the deepest crisis of our generation?”
Resolving those questions in the favour of people over profit – to quote Jon Trickett – will require “an enduring and permanent shift in the balance of wealth of power in favour of working people.” That is the yardstick by which this budget – and any proposals to face the deepening crisis – should be measured.
- “Investment not cuts – The #peoplesbudget We Need” was hosted by Arise Festival and the Labour Assembly Against Austerity on March 13th, 2023. You can watch the meeting in full here.
- For more updates ahead of Sunak and Hunt’s Spring Budget, follow the Labour Assembly Against Austerity on Facebook and Twitter.
- You can view all upcoming Arise Festival events and discussions here.