Unite has urged chancellor Rishi Sunak to reject a return to austerity ahead of his comprehensive spending review on Wednesday (November 25) amid reports that the latest announcements will hit the lowest paid the hardest, while public sector workers may also be in for another pay freeze.
The Times reported on Tuesday (November 24) that a planned increase in the statutory minimum wage from the present £8.21 an hour to £9.21 – an anticipated hike of 5.6 per cent this April – will be scrapped. Instead, the wage rate will be increased by only 2 per cent to £8.90.
Meanwhile, many media outlets reported last week that the chancellor is considering an across-the-board three-year pay freeze for all public sector workers, potentially excluding frontline NHS staff.
Taken together, this means that those workers who were indispensable in keeping the country going amid the pandemic – supermarket workers, carers, cleaners, as well as bin men, teachers, police officers and many others – may collectively be forced to shoulder the burden of the very crisis they risked their lives to tackle.
Many of the UK’s industries face impending annihilation as the chancellor has so far refused to offer support packages for sectors such as aviation, hospitality, aerospace and others, despite competitor countries such as Germany and France having done so with success.
Hundreds of thousands of people who have lost their jobs since March are also falling through the cracks of a woefully inadequate social security system. A £20-a-week increase in Universal Credit payments since the start of the pandemic may now be at risk in the upcoming spending review.
For those who have kept their jobs, huge swathes cannot do the right thing and stay at home if they contract coronavirus because they are only entitled to statutory sick pay, which in the UK is among the lowest levels in Europe, and at just £96 a week, is not enough to live on.
Against this backdrop, Unite has called on the chancellor to use the power of his office to fend off mass unemployment and make 2021 a better year for working people.
Writing to the chancellor ahead of his spending review on Wednesday (November 25), Unite general secretary Len McCluskey has outlined three main platforms that would position the UK for building back a fairer economic recovery amid and after the pandemic.
These include a strategy for a post-Covid-19 manufacturing economy with an emphasis on investment, employment and training; a plan to promote social cohesion through significant increases in welfare payments, including maintaining the £20-a-week uplift in Universal Credit payments and increasing statutory sick pay levels (SSP) to a living wage for those forced to self-isolate; and the restoration of decade-long cuts in the NHS, social care, schools and local government with a pay rise to recognise those workers’ contribution in the battle against coronavirus.
McCluskey also called in his letter for an increase of the minimum wage to £10 an hour, and a fix to the furlough scheme, which at present covers 80 per cent of wages for furloughed workers, so that no one is paid below the minimum wage. He moreover called for urgent extra resources for public services to equip them for the difficult winter ahead and the future.
Commenting, McCluskey said, “Chancellor Rishi Sunak has an opportunity tomorrow to show that he is listening to the growing chorus of calls to grow our country back to economic health.
“2020 has been a disastrous year for jobs and incomes, so it is vital that we hear from the chancellor that there will be a massive effort, working with industry and trade unions, to make 2021 a year of jobs’ creation and income’ stabilisation,” he added.
“We must at all costs avoid the prospect of mass unemployment that would scar our economy and the lives of thousands and their families for the foreseeable future.
“Follow the economic wisdom, and invest to stimulate recovery. No re-announced money, no ‘reheated’ ideas, but a comprehensive strategy uniting our country in truly building back better. Give the economy a much-needed shot in the arm, chancellor, and absolutely do not dent the already incredibly shaky consumer and business confidence.”
McCluskey said that this would mean “jettisoning the tired orthodoxy of wage austerity”.
“Not only will yet more wage pain for the nation’s frontline workers be a massive snub to people who’ve gone the extra mile to keep our services running and the public safe during this crisis, it is also economic madness,” he noted.
“These five million public sector workers, in the main low waged and women, don’t keep their cash in the Cayman islands away from the taxman’s grasp. They spend it in our shops, helping our struggling high streets.
“Attacks on their wages raises only peanuts in the scheme of things yet will cause huge harm so drop this threat, chancellor. Instead of launching another hit on the poorest, stabilise the finances of the millions of low income households in this country.”
McCluskey went on to emphasise the need for increasing statutory sick pay, so that, he said, “those who need to isolate can afford to do so” as well as the importance of maintaining the £20 uplift to Universal Credit.
To remove this “cash lifeline” he said, “will destroy many of those just about holding things together”.
“Unite has outlined a strategy that includes an industrial strategy based on investment in the ‘new’ industries, such as electric vehicles and ‘green’ clean energy, and that is underpinned by high-quality training, including a large-scale apprenticeship programme,” McCluskey continued.
“Where better to start in terms of greening our economy and creating jobs, especially for our young people, than embarking on a massive house-building programme.
“The coronavirus has super-charged divisions in our society, hitting the disadvantaged, the low-paid and BAEM communities hardest. But mass unemployment and deepening inequalities are not the inevitable consequences of this pandemic. Political choices can avert both.
“The chancellor must signal tomorrow that he recognises that he has the power and responsibility to renew our country so that 2021 provides a brighter, safer future for all.”
You can read the full text of Unite general secretary Len McCluskey’s letter to the chancellor here.
By Hajera Blagg