By Jeremy Dewar
Workers in Britain are being hit by a triple whammy this month: inflation heading towards 5%; a £20 cut to Universal Credit, hitting the unemployed and worst paid workers; and the ending of furlough for 1 million workers, throwing hundreds of thousands out the door.
These are not ‘temporary blips’ that will be ‘ironed out’ in a few months, as the mainstream media would have us believe. Even bourgeois economists admit the recovery has already slowed and forecast that inflation will be with us at least into the middle of 2022. There is no planned rise in UC – or they wouldn’t have cut it in the first place. And a 1.25% hike in National Insurance and probably further gas price rises will hit us again in April.
The costs of Brexit, including the shortage of HGV drivers and seasonal agricultural workers, are showing up as empty shelves in the supermarkets. The hospitals and the care homes, too, are victims of Brexit, as nurses, doctors, cleaners and carers have been forced to leave Britain. Then there have been the repeated covid surges due the premature relaxation of protective measures.
Inflation
Gas prices have quadrupled in the last year, up 70% since August alone. The cap, which is supposed to protect us from price hikes, has been raised 13% to protect the energy firms instead.
The increase will be even steeper for those on meters (the poorest sections of society) at £3 a week. Households switched because their supplier goes bust (nine have already) will be automatically put on the highest tariffs possible.
Food prices have risen by 1% in the last month and 5% in the last year. Lack of CO2 affecting food packaging, abattoirs and transportation costs, will drive prices up even further. Only under capitalism could food lie rotting on farms and in processing plants while people go hungry.
Rents – another unavoidable bill – have also risen by 7% in the past year, 2.3% in the past month. Landlords have taken full advantage of the ending of the ban on evictions in June to rachet up their rents, knowing tenants must either pay up or face homelessness.
The panic buying at petrol stations may or may not be based on rumours. What is more certain is that oil prices will rise by 8% by the end of this year, as predicted by Goldman Sachs.
Universal Credit
Chancellor Rishi Sunak’s snatch of £20 a week from each of the 6 million UC claimants is the single biggest benefit cut since Margaret Thatcher’s in the 1980s.
Of those 6 million, 4.4 million are in work. In other words, they are underemployed and underpaid by their bosses, who do not even pay subsistence wages and are subsidised by general taxation, i.e. the working class. Zero hours contracts, part-time minimum wage jobs and bogus ‘self-employment’ assign millions to state handouts, while the unemployment figures are massaged.
The cut will also affect 3.7 million children, throwing half a million families (including 300,000 children) into poverty, according to the Joseph Rowntree Foundation. Who knows what misery this will cause, but hungry children will lose out on education, families will be evicted or relocated, pensioners will die from hypothermia.
The cut is huge. Single claimants will see their benefits slashed from £411 a month to £324, under-25s from £344 to £257. Proportionally this translates into a 21% cut for adults and 25% for youth, which would prompt a walkout in any workplace. But the Tories think they can get away with it because they do not work.
Make no mistake; this cut affects all of us, claimants or not. It is deliberately set too low, i.e. below the actual cost of living, in order to shock workers into accepting wage cuts rather than end up on the dole and to force the unemployed into accepting any job on offer, even though they can only retain a third of their pay as UC is tapered. A race to the bottom is enshrined in Universal Credit, which is why it must be replaced by a living wage for all, based on a real living wage of £15 an hour.
Furlough
The Tories’ Job Retention Scheme, furlough, ends for 1 million workers this month. Hundreds of thousands will not find work, pushing the unemployment rate up to 5% or higher.
With over 1.5 million already out of work, the vacancies on jobs website indeed.com offer grim reading. The types of contract, pay rates and security or length of tenure attached to most ‘new’ jobs are generally worse than those being lost. The workers forced to take such jobs will face drastic cuts to their living standards, if not outright poverty.
Besides this, the record number of vacancies is no guarantee that workers can fill them. Many reflect skills shortages, like the 100,000 lorry drivers Britain needs, that cannot be magically filled.
Time to say, we won’t pay for your crisis. Cut your profits not our wages, pensions and welfare.
Fightback
To combat this crisis, we must start the fightback now – before long-term unemployment and grinding poverty sap the will to resist.
All workers should follow the example of Argos drivers, who struck for and won a 32% pay rise. While some private sector workers have pushed up their wages recently, the relatively well-organised public sector workers have fallen behind.
Nurses and care workers should relaunch their protests and demand their union leaders ballot for strike action for a 15% increase across the board. Council workers, fire fighters and civil servants should join the fight to recoup the real pay cuts of the past decade and demand their pay is linked to inflation in a sliding scale: 1% rise in wages for every 1% rise in prices.
Fight every job cut and closure with strikes and occupations. The government shouldn’t be bailing out failing companies, like the energy suppliers, but nationalising them without compensation and placing them under workers’ control. Open the books and let’s see where the money has gone.
We need an unemployed workers’ union, open to all affected by the UC cut. Like in the 1920s-30s and again in the 1980s, the unemployed should demand real jobs rebuilding our communities and fighting climate change with a full living income for themselves and their families. If the unemployed and the underemployed organise to support workers taking strike action, then all will be stronger and more willing to resist.
It is good that Unite and Unison, Britain’s biggest unions, have elected new leaderships, using more fighting rhetoric. It reflects, as do the numerous small strikes that are erupting, a new fighting spirit in the working class. But now we need those leaders to walk the walk.
The entire labour movement must demand the ruling class pay for the crisis caused by their system with a huge tax on their wealth and profits, through the expropriation of their firms whenever they threaten cuts and through attacks on their ‘right to manage’ individual companies and the economy as a whole. With a wave of strikes by different groups of workers likely to develop over the coming months, we need solidarity between them, and to mobilise support. Militant local union branches need to get together to organise this via the trades councils where they are still active or by forming committees of action where they do not.
