The TUC public sector strike on November 30th is , in effect, a General Strike, the biggest concerted day of action since the General Strike in 1926. The attack on public sector pensions follows months of pay freezes, cuts to staffing, to budgets affecting working conditions, extending working hours and adding to stress levels, with inevitable effects on the mental and physical health of workers.
Lies about the previous government’s deficit and the need to cut public expenditure has been justification for cuts to the public sector, and the lie that fair pensions are unaffordable is similar justification in their eyes. Lies, lies and constant government propaganda which amounts to drip fed indoctrination aimed to frighten the electorate, to divide the working class into public and private sectors, each blaming the other for the country’s ills.
MYTH: The private sector props up the public sector
“It is not a one-way street, but a complex relationship. Public sector workers and employers pay for the vast majority of pensions in payment through contributions. Without an effective public sector, the private sector would be far less productive. The public sector contributes significantly to GDP and it is entirely unfair to suggest that the public sector is any way a drain on the private sector.” TUC Myths and Pensions
MYTH: Public sector workers all have comfortable pensions
“Five million employees working in the public sector qualify for pensions, including 1.3m in NHS, 1.6m in local government, 600,000 teachers, 600,000 civil servants, 200,000 in the armed forces, 150,000 police officers and 50,000 firefighters. The mean average public sector pension is £7,000 but the majority of public sector pensioners have pensions of less than £5,000. The average public service pension is around £7,800 a year, for women working in local government the average is £2,800 a year, while the median for women working in the NHS is £3,500 a year: hardly huge pensions. Saving towards an occupational pension in many cases means a person is receiving fewer welfare benefits during retirement, saving the taxpayer money.”
MYTH: Public sector workers are lazy and inefficient
In 2010, a study found that public sector workers do an estimated 120 million hours of unpaid overtime a year – the equivalent of employing an extra 60,000 people. They went on to claim that 46 per cent of employees in education, health and social care in the “non-profit sector” work unpaid overtime, compared with 29 per cent of their counterparts in the private sector.
MYTH: Losses to jobs in the public sector will be replaced by jobs in the private sector
If David Cameron expected this to be the case, he has been proved wrong ( See C4 News). Job losses caused by cuts to the public sector will not be replaced. Increasingly we hear of firms making job cuts despite their profits, for example Top Shop owner Philip Green has announced further job cuts despite profits. People fear for jobs and won’t spend.
The private sector workers, are seen by many in the public sector as being on high salaries, inflated incomes with perks such as cars, private health schemes. It may be evident that some industries pay ridiculous salaries to directors and this is what springs to mind to those working in the public sector. The reality is that the profits are not fairly distributed. The toils of the workers in the private sector are not fairly rewarded. Salaries have not kept up with inflation. Demands from employers and union rights are not universal. Women in particular may face discrimination.
MYTH: All private sector workers all are paid high salaries
Lowest and Highest Pay Top Ten Data from ASHE (Annual Survey of Hours and Earnings) for ONS, and published in the Guardian shows median salaries for 2010 and 2011, shows the highest and lowest median salaries. It is interesting data and clearly shows that many in the private sector are on very low pay.
It shows that roles which have been historically carried out by are women are particularly low-paid. It also shows that pay cuts seem to be hitting the poorest paid most. It does not show the whole picture however and there are several important pay factors that Ashe cannot show.
- The data only applies to employees on company payrolls, so cannot reflect the earnings of the self-employed entrepreneurs, athletes and celebrities who between them constitute many of the country’s really top earners.
- The survey only measures base pay and does not take into account additional methods of reward such as bonuses, pension payments, share options and so on.
- It cannot reveal the earnings of those with multiple income streams, such as legal and accounting partners, or directors of multiple companies.
This may explain why Ashe figures for directors and financial workers, although top ranked, look surprisingly low. The median full-time base pay in this category rose by 15.3% this year, partly due to a trend of shifting executive earnings away from bonuses and towards basic pay. If the sectors as a whole are compared we can see that the gap between public and private sector pay is at its highest in ten years, as Richard Murphy writes.
MYTH Private sector offers better prospects, perks and conditions for its workers.
“It’s an inconvenient truth, (PCS Union) that the press who look for negative reporting of trade unions, in saying that they are outdated and membership is declining fail to explain the full story. In fact any declining membership is directly connected to overall job losses in that sector. They decline to explain about the union wage premium which refers to the degree that union wages exceed non union wages.”
The last BIS report (2010) re-affirms the importance of the union wage premium, in that:-
- Collective agreements cover 64.5 per cent of public sector employees and 16.8 per cent of private sector employees
- The hourly earnings of union members is reported to average £14 in 2010, 16.7 per cent more than the earnings of non-members (£12).
- The union wage premium is much larger for employees in unionised sectors than their non-unionised counterparts.
Hourly wage rates for (unionised) public sector employees were 21.1 per cent higher among union members than non-members and 6.7 per cent higher in the (less unionised) private sector. PCS members working on Hewlett Packard central government contracts currently have an opportunity to ‘opt in’ to collective bargaining and it is no accident that the company is making opting in look as unattractive as possible.
A member said: “I took the decision to opt-in in 2010, when my salary was £17,500. Since then I am looking at over a £1,300 consolidated pay increase on my salary with most of that increase counting towards my pension.”
One member commented: “As a low paid HP employee ‘My choice’ has me trapped in a downwards pay spiral. For the last five years my pay has been frozen whilst my costs of living have been rising and I have to sell my benefits simply to stay afloat.”
And so it remains true, many in the private sector are denied rights to fair pay and conditions, while in many cases massive profits are being made at the workers’ expense. All workers’ rights to be a member of a trade union and the potential benefits must be preserved. The very rich and the Tories will look after their own. So, too, workers must support each other, in unison.
MYTH Private Sector workers have great pensions
“Private sector employees have been hit hard by the employer retreat from good pensions. But this does not justify punishing public sector workers. Two wrongs do not make a right.
The real inequality exists in the private sector, where highly paid executives receive the real gold-plated pensions. The TUC’s 2008 Pensions Watch study of 346 directors from 102 of the UK’s top companies found that they are set to earn a yearly pension of £201,7003. This is 25 times the average workplace pension that ordinary workers receive (£8,100).
Private sector schemes need to be funded because there can be no guarantee that the sponsoring employer will still be around when staff retire. Public sector employers, ie the state, will exist in perpetuity and, as in other countries such as the USA, we tend to have unfunded pensions for central government functions such as health and the armed forces but funded schemes in local government.
The study also revealed that the most senior directors of these firms had average pension funds of £5.2m, with an annual pension forecast of £333,400. In reality, most directors of the UKs largest private sector companies can look forward to retiring on a full pension at age 60, accrued on generous terms in a final salary scheme.”
WHY WE WORK
Let’s take a step aside, those of us that are lucky to be in work are motvated by a number of reasons.
- We need to work to live
- We may want to make a difference to other people’s lives
- We want the opportunity to use our skills
- We enjoy the social contact which work brings to us
- We want to contribute to society
Most of us go to work for all of those reasons, but , let’s face it, it is the first and foremost which gets us out of bed on wet, foggy November mornings.
THE REALITY WHICH DIVIDES SOCIETY
One thing is certain, none of us go to work in order to line the pockets of the very rich. When we pay our taxes, even if we do so grudgingly, we know – and hope that – that investment will be returned to us, if we are too ill to work, to pay our pensions when we are old, if we have children who need care, to provide homes, roads, hospitals and schools. We are not happy that people in poorly paid jobs pay taxes disproportionately compared with those on inflated salaries. In contrast, those that make profits of millions and billions from the toil of poorly paid people in the private sector pay no tax at all.Their funds are secretly hidden in “ made up” City-States which make their own tax rules, where nobody really lives and works. Yet that money may have been made from retail workers at your local shop, or by teachers at some new Free School sponsored by some private company using assets stolen from the British people.
The Tolpuddle Martyrs went to the ends of the earth to stand up for the rights of workers. Thatcher sullied the name of Trade Unions. Let us remember what we owe to them, and support the rights of workers everywhere.
Unemployment is soaring; now at 8.3% of the work-force. There are over one million unemployed young people. Where is the sense to insist people work well into their sixties if they feel spent and ready to enjoy a deserved retirement. Just to deny them the pension they have paid for. To save money? All this will be to the cost of the young to whom the nation must pay dole rather than pay well-earned and well-deserved pensions to the more mature population. This is absurd! There are now the highest number of female workers out of work for twenty-three years. The increase in female unemployed is directly related to the attack on the public sector, where workers are predominantly female. Do not be fooled. It suits the Tories for unemployment levels to be high – it enables them to cut wages, to make more profits for their friends. It engenders fear – it pitches public against private -, private against public – social friction which detracts from the real enemy , the plutocrats that have increasing power over us throughout our daily lives. Poverty will increase, hunger , homelessness and suicides. And therein is fuel for the far right, as in the nineteen thirties. It suits them to believe the workers have not noticed, that we are besotted by X factor and Big Brother. They are wrong, three quarters of the electorate in a recent Mori poll think that the government have done a poor job in keeping unemployment down.
The government under-estimates the working -class- all of us who go to work, for that is what we are – not Class A, B or C – we are all workers.
Labour Party Policy must address:
Trade union rights for all
Inequality in the workplace and in pay
Redistribution of wealth including a modernised clause 4 and workers co-operatives
It might seem an old cliché, but it is true. The workers, united, will never be defeated. And it will be forever true. But divided, we fall. They win.
Think Left On The Public Sector Strike:
TUC Day of Action, November 30 Think Left
OTHER REFERENCES AND FURTHER READING