Osborne’s National Living Wage is a Complete Con

Budget day protest in Parliament Square, London 8th July 2015. Photo: Steve Eason

Budget day protest in Parliament Square, London 8th July 2015.
Photo: Steve Eason

Eleanor Firman, Unite Community activist and Left Unity member, shares her views on yesterday’s announcement by Chancellor George Osborne.

The compulsory National Living Wage which Osborne announced today is a complete and utter con. The media are hyping it as the Tories stealing Labour’s clothes but the miniscule Living Wage is not about Osborne getting tough with low wage-paying bosses – the reality is in fact the complete opposite: the Tory Chancellor is merely instructing businesses to return a tiny fraction of the money that has been stolen from our (social) wages and handed to bosses in the form of the employers’ National Insurance ‘allowance’ that began last year (up to £2000 per employer) and was increased by Osborne yesterday to £3000.[1]

Society seems to have forgotten that Employers’ N.I. contributions are actually part of wages – they are the portion of the wage that instead of being paid direct to the employee is forwarded directly to Treasury by the employer where it is pooled with all N.I. contributions and returned to workers in the form of the social wage i.e. the welfare state provisions of pensions, the NHS, compulsory education and social housing. So employer’s contributions are actually our wages but we don’t see it because it is paid on our behalf and then collectivised before we get our pay packet. This collectivisation includes spending in the form of social assistance for those who cannot work due to their impairments or those whose pay is inadequate.

This system of social insurance that began in 1946 is commonly referred to as the post war social settlement but understood by the left as a compromise between labour and capital to fend off rising social unrest: capital could keep a certain amount of profit if workers laboured not just for subsistence wages in the form of cash, but also improved social conditions.

Now public services and welfare are being dismantled and employers are being made to give back a tiny portion of their new N.I. allowance to the workers in the form of the new ‘national living wage’ – but the overall amount of tax and N.I. allowances bosses receive will more than offset a marginally more expensive workforce. Let’s not forget corporation tax was also cut to 18% along with other tax breaks for the rich.[2] So this national ‘living wage’ is not just a downgraded replacement of the higher voluntary living wage as many are pointing out, – but is actually a cut to the existing compulsory minimum wage.

Osborne was deadly serious when he described his budget as a new social settlement. But do the public realise what has really been lost? Less tax and less welfare does not just mean higher incomes for a few, and lower incomes for the many. It means less public services as well as greater financial inequality. Iain Duncan Smith’s reaction yesterday in the Commons and the following day in the Daily Telegraph, clearly signalled that for people like him who only came into politics to realise the vision of Margaret Thatcher, Osborne’s National Living Wage is a dream come true. For the rest of us it’s a laissez faire nightmare.

[1] https://www.gov.uk/employment-allowance

[2] In a bid to reassure businesses, the chancellor also reiterated that the cost to business will amount to one per cent of corporate profits, which he has offset with the cut in corporation tax to 18 per cent. Smaller firms would be helped by a cut in their national insurance contributions. From 2016, the new employment allowance will be increased by 50 per cent to £3,000 and a company employing four full-time workers on the new national living wage would pay no national insurance.
http://realbusiness.co.uk/article/30726-summer-budget-2015-compulsory-national-living-wage-gets-mixed-reception

George Monoux dispute: NUT statement on the suspension of strike action

The National Union of Teachers (NUT) branch has issued this statement following the temporary suspension of their strike action:

Following discussions between NUT officials and the Chair of Corporation, a new proposal has been put forward with the aim of resolving the dispute over the unfair sackings of Flor Thompson and Diane George. This will involve an independent adjudicator hearing evidence and presenting a new report to the Corporation. Any member of staff can present evidence to this adjudicator, and their evidence will be anonymous.

To facilitate an attempt to resolve the dispute, the NUT will co-operate with this process and has decided to suspend the action planned for this week. In doing so we wish to stress:

1) The NUT remains in dispute with the college on this issue.

2) We have made no commitment to respect the outcome of this process, especially as the adjudicator’s report goes to the Corporation itself. Our resolve the fight for a fair outcome of our members remains undiminished. The college in turn has not given any pledge to respect the findings of the adjudicator.

3) We have merely suspended industrial action for this week. Our ballot for discontinuous strike action remains in force and allows us to resume strike action next term should this be necessary.

The NUT remains easily the biggest union in the college and the overwhelming majority of our members have respected the picket lines. We congratulate our members for their continued solidarity and determination in the face of the barrage of propaganda and disinformation ranged against them.

Walthamstow eviction resistance workshop

Sunday 5 July 4-6pm, St Barnabas Church Hall, St Barnabas Rd, Walthamstow, E17 8JZ

Nearest rail: Walthamstow Queens Rd (Gospel Oak to Barking Line)

Nearest tube/rail: Walthamstow Central (Victoria line, also Liverpool St – Chingford rail)

Map/buses directions

And join us later next door where a pop up pub is selling fine ales from Wildcard Brewery

Organised by Unite Community Waltham Forest, Radical Housing Network and Eviction Resistance

For more information, contact: 0795 404 7527