When both the Governor of the Bank of England and the Prime Minister called for ‘pay restraint’ it was clear that workers were being set up for a fall. Once again we were being asked to pay the price for a mess not of our making. With inflation hitting double figures and more, we are now in the mist of another crisis in the real economy – one that is attacking living standards.
The establishment call for a national pay cut, is consistent with the pattern of recent years. We know how the story goes. A crisis of some kind ensues, that to resolve requires either real change to the economic order or for someone to lose out and the establishment picks what appears to be the easy option. Looting the workers.
But just like that other recent disaster, the financial collapse of 2008, working people did not cause the problem and it’s not us that should pay. Once again we are being told just one side of what is actually a very revealing story. This time, the vested interests have erected another wall of silence, only now it concerns profits and in particular, profiteering.
Combining the knowledge and experience of our reps with the abilities of our new in-house expertise, we have begun to develop a real workers’ narrative. And on Friday Unite released the first report by our Profiteering Commission. In it we show that the average profit margin of a FTSE 350 firm grew by over 70% in 2021 compared to 2019. This means that many firms across many sectors, not just energy, were profiteering coming out of the pandemic, on a scale not seen before it.The exponential extent of some of the corporate profits recorded is shocking.
The report also shows that in the last six months alone, wages declined whilst profits grew – this time by more than 8% in real terms. Crucially, it is those profits than have contributed more than 50% of the ‘second round’ spike in inflation, not increased wages.
Corporate Britain is cashing in. Many prices are being increased in excess of what is needed to cover rising costs and that is creating further downward pressure on living standards. Ordinary people are now paying more because corporations are lining their pockets. It is no longer just a point of comparison – it is cause and effect.
This reality is rarely if ever spoken of and it is not because no one knows about it. Buried in the minutes of reports you can find the Bank of England acknowledging the ‘contribution’ of rampant profits to the crisis, but it is never discussed publicly. That is because the vast majority of our political class and the institutions they govern, don’t want to even consider any alternative to the economic orthodoxy.
Our political class has failed and it is now down to the trade unions to step up to the plate. It is no surprise that many of the firm’s lining their pockets are the same ones that used the pandemic to ‘Fire and Rehire’ employees or to cut jobs, pay and conditions. We must come together and not be afraid to do our job. To do what it says on the trade union tin.
At Unite, in the last 6 months over 50,000 of our members have been involved in some form of dispute. We have shown that taking action against uncompromising employers works. Those disputes alone have delivered agreements worth an extra £50 million to our members. But now we need to go further and by that I don’t mean simply more strikes. We need to start creating real solidarity and use our brains as well as brawn. That starts with developing our work collectively.
I discuss Combines a lot within Unite, building networks of reps that work towards common demands. Well, we also need to work across unions and co-ordinate our industrial activity. It is not beyond us to start that process and it is certainly not beyond us to deliver more comprehensive campaigns and look at the support that we give our reps. Whether that is finding out the real ‘ability to pay’ of a firm, or understanding who really makes the decisions in a company and how to move them. All these things are possible if we have the will to do so. There is so much potential for us to make change ourselves.
Finally, there has been a lot of talk about a ‘summer of discontent’ . Well if that means a summer of standing up for workers then I have absolutely no problem with that.
By Sharon Graham, Unite general secretary
- This comment first appeared in the Morning Star on Saturday, June 18.