My 2011 book, The Courageous State ended with several chapters that set out a plan, by issue, for for country I wished to live in and which would deserve the description within the book's title. I thought I'd share four sections from chapter 16 this morning. I suspect I'd be more specific and maybe a little bolder now as the issues have become ever more apparent, but these extracts remain some indication of where I stand, and have for some time:
Increasing the minimum wage
The desire to work to maintain one's self, or to maintain one's family, is core to the human condition. The provision of employment opportunities for all who want them must be a fundamental objective of the Courageous State and a condition for the achievement of potential for most who live in it.
Ways of creating new employment in the UK through the creation of an investment bank that will build new infrastructure to support a long-term sustainable economy have already been discussed but it is as important that the employment created sustains those who are engaged in it. That means that at a minimum a person should be able to live without suffering relative poverty on the reward of their employment.
The minimum wage was one of the great successes of the Labour governments between 1997 and 2010. It was universally condemned when proposed, with claims being made that it would create mass unemployment and harm business, but neither happened. The real wages of many were increased as a result of that legislation, but it remains the case that a minimum wage of only just over £6 an hour is far too little to ensure most people, even people living by themselves, can sustain themselves without risk of being in relative, and sometimes absolute, poverty. As a consequence those employers paying at this rate at present receive a massive effective subsidy from the state because their employees must apply for benefits to ensure that they can live at the most basic standard of living. That is ludicrous: to support business to pay wages that are below poverty levels makes no sense at all and the minimum wage must be increased to reflect the real cost of living, if necessary with regional variations to reflect the fact that, for example, living in London is more expensive than in some other areas.
Protecting union rights
A minimum wage is a basic prerequisite for ensuring that an employee can sustain themselves as a result of their own efforts, but it is not enough to protect them from all situations that might arise during the course of their employment. The employer/employee relationship is a perfect example of an asymmetric relationship, with the employee almost always having the weaker negotiating hand. It is not by chance that the trade union movement helped employees throughout the UK achieve some of the most basic advances in employment rights ever seen. So, for example, they helped secured legislation on health and safety, paid holidays, equal pay, protection from dismissal and much more.
It is now popular to dismiss union power on the basis of some excesses in the 1970s, and there is no doubt that unions must not be in a position to influence the economy in the way that banks do now, but to deny employees the right to collective bargaining, protection in industrial disputes, and representation in the workplace is to deny them fundamental human rights and as such the role of unions in the workplace must be supported by a Courageous State.
Industry wages boards
Collective bargaining is powerful: it has almost invariably improved the lot of those workers whose conditions are negotiated in this way, to their own benefit, and although many will only grudgingly admit it, to the long-term benefit of their employers as well. There are, however, many situations where collective bargaining cannot be applied. This is, for example, the case when the place of employment is small or the workforce is widely dispersed. This happens in retailing, restaurants, agriculture, and many small businesses. In these cases there has been too prevalent a tendency for business to offer the minimum wage as if it was the de facto basis for employment, whatever the skills a person has to offer and whatever their worth to the enterprise. That is wrong, and was recognised to be wrong in the past when industrial wages boards set minimum pay levels for particular skills in specified sectors to ensure that people would not exploited whatever their particular employment circumstance. The restoration of these boards with the task of setting minimum standards for pay and conditions of employment seems a basic necessity to ensure that all employees are properly rewarded without the difficulty and embarrassment of complicated negotiation having to take place in situations which inevitably favour the employer.
Of course such boards cannot provide an ideal solution for all employment situations, all skills and all environments but they can offer clear guidelines, empower employees and ensure that people can advance their claim for rightful reward against pre-established benchmarks which should make reaching fair agreement easier for all.
Apprenticeships
Fair pay is an important part of the workplace relationship, but it is by no means the only component of a successful working relationship in which both employee and employer benefit.
There is widespread recognition that the UK has a skills shortage and that this is particularly prevalent among the young, where currently education is heavily focused on academic achievement even if that has little bearing upon the needs of an eventual employer.
It is obvious the UK needs more skilled employees, and not just those with academic qualifications. Apprenticeships were at one time the foundation upon which the skills of our economy were built. Those who would master a trade, prove their skills and demonstrate their worth were rightly rewarded for doing so. This fostered the skills that society needed while training in the workplace built a strong sense of community and provided the skills needed in the local economy to meet local demand. Apprenticeship is an essential way of delivering this opportunity to young people and as such financial incentives, support and if necessary tax encouragement must be given to both employees and employers to participate in these arrangements, with the inherent long-term relationship that they also imply.
Industrial training boards
Apprenticeships are vital but the skills a person needs change during their life, as do the jobs that people undertake. Skilled employees add value and yet far too few employers invest anything at all in the skills of their staff. This results in a loss in productivity, profit and opportunity for advancement on the part of those they employ. This is a scandalous waste of resources that must be corrected.
In more enlightened times industrial training boards existed in the UK to ensure that those who worked in a wide variety of industries, from the service sector to heavy manufacturing and construction had access to training appropriate to their needs at reasonable cost that ensured that they could fulfil their potential at work. A Courageous State would reintroduce such boards and provide employees with a statutory right to training during the course of their employment, for which their employers would make only modest payment.
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Were the minimum wage to be reorganised with no age bands (so everyone would be on £7/hour minimum), what would the impact be?
How much real evidence (vice anecdotal, of which there is some) is there that employers take on “kids” and pay less, then sack them when they turn 18, 21 or 25 to be replaced by more “kids”?
Is it this gaping hole in minimum wage provision that made businesses acquiesce to it?
I have seen very real evidence
I ma not sure if it was ever published so cannot afford the risk of naming the names
Spot on, particularly re apprenticeships. The purpose of education should be to find out what a young person is good at, and help them to become very very good at it, whatever ‘it’ is.
I see no reason why someone should not be able to get a degree in, say, plumbing or baking. In Germany they can aspire to a Meisterbrief (loosely “Master Certificate”), which commands the same sort of respect as an academic degree and is hung just as proudly on the wall.
Well said.
We are over-inclined to be insular, whereas what we need is enough humility to be willing – indeed eager – to learn from other countries’ practices where they are clearly more successful than our own.
This is particularly true in regard to vocational education, for young adults especially (where you cite the German example, and I would cite the comparable Scandinavian), where Britain’s lagging-behind is glaringly conspicuous and almost certainly accounts for by far the greater part of her persisting productivity deficit.
If prioritising be needed I (a non-engineer and technologically-challenged dimwit) would put acquisition of all forms of engineering expertise highest. Just look at China – and be awed!
Maybe Mrs May will start to value young people and realise they are vital to a healthy society. Unfortunately the driving force from the “upper classes” is always to keep that divide and look globally for cheap labour, how can this bring prosperity for all.
‘They’ do not wish for a more egalitarian society. So alliances or otherwise with a leader showing ”good chutzpah’ is desperately needed.
It is obvious how much regard people have for Mr Corbyn, in my view he is not the heavyweight needed, just a view.
If only some of your ideas are included in a government it would be a start, you must be concerned about how your sons will make a good life. My children are in their late forties, still employed, all have a good work ethic, lucky to be healthy and able, they will need to be well enough to work until distant retirement. Less hours perhaps and so more productive, better work life balance, we deserve it.
“‘Chutzpah'” would certainly help (as in Lloyd George’s case) but what above all is needed is a core-ideology capable of attracting broad-based support – as his did (it attracted Churchill. for one – see Richard’s post http://www.taxresearch.org.uk/Blog/2016/07/27/on-the-need-for-wage-councils/ )
“Unfortunately the driving force from the “upper classes” is always to keep that divide and look globally for cheap labour”. I think to see this in class terms is a mistake. Neoliberalism isn’t concerned with class but with individual wealth-acquisition regardless of class-origin (in theory anyway). Unimpeded access to sources of (compliant = unorganised) labour is just one of its stated prerequisites for getting the maximum gain out of the market economy, which is the goal. The theory says that that maximised personal wealth will in time “trickle down” to the rest of us, but we all know that the opposite happens:- it is hoovered up, and up, until eventually most of it ends-up with the 0.1%, who have no use to put it to except acquiring yet more, in terms purely of unproductive financial assets (to the growth of which there is literally no limit since compound interest is built-in by our monetary system).
This is the core-ideology which has captured the seats of power over the last four decades – INCLUDING BRUSSELS (so, btw, that Brexit is seen from a Left perspective as nothing short of cataclysmic seems like downright perversity, if it isn’t hopeless muddle-headedness).
To de-throne it is going to require an alternative ideology no less potent.
I do accept political neoliberalism is a thing apart from the landed gentry, however their not entirely benign influence I suspect networks away to influence government. They will attract each other and protect each other, new money gains and learns about which fork to use eventually. I sound like I have been watching too much Downtown Abbey.
I agree very much re apprenticeships and Industrial Training Boards yet I cannot work out why, when university students qualify saddled with ever more debt, and apprentices don’t, that there is not a significant shift towards apprenticeships instead of increasingly obscure and not necessarily financially beneficial degrees.
I used to think it was the appeal of abstract thinking but I’m not convinced all degrees encourage that, so can only conclude it comes down to prestige. And I fear this will be altered only when the UK finally gets an industrial policy and it can create some valuable prizes with suitable razmatazz for apprenticeships – perhaps by appointing some prizewinners for lead tasks on PQE funded projects.
We can but hope.
Where do you stand on the role of unions in the public sector?
There are prominent figures of the left (eg FD Roosevelt, George Meany – president of the A.F.L.-C.I.O in the 50s) who thought there was no role beyond basic consultation.
If the Courageous State has the democratic legitimacy to set all kinds of things which the public is obliged to accept, why doesn’t it have the same legitimacy to set civil servant pay and conditions on a take-it-or-leave-it basis? And any strike in opposition to them is effectively a strike against the people.
Unions are there to protect against rogue employers – the Courageous State is not (by definition) a rogue.
I don’t have a strong view, except to say it is hard to accept that the view the Courageous State has unfettered legitimacy to do whatever it likes in some things, but not others. One can’t have it both ways.
I would be interested in your thoughts and those of your readers.
Of course there are route employers in the state
People who abuse
Who are sexist
Who get things wrong
Sometimes deliberately
And people need to be protected from them
The State then needs to ensure they are dealt with
But to assume a state is always being is absurd: it is staffed by real people and it must put appropriate checks and balances in place on them
Richard
I would have thought that those sorts of abuses were best dealt-with through “employment protection” regulations, applying to all employers alike.
In which case your answer is I suggest tangential to the question as put, which clearly concerned basic terms and conditions of employment, not the sort of “wildcat” abuses of employer-power you refer to.
My own view fwiw of Adrian’s interesting suggestion (assuming he doesn’t have his tongue in his cheek) is that no democracy could ever contemplate giving such a degree of unfettered and arbitrary power to unelected officials. The operation of a democracy requires checks and balances to power so that its exercise is never unchallengeable, either by those subjected to its edicts or by parliament.
Roosevelt’s opponents (on the right, mainly but not exclusively) were wont to accuse him of seeking to take too much power into his own hands.
But someone has to represent the employee
And that is their union
I agree, the State is made up of ordinary people with normal human failings. This is why it is a good idea to have limited government – to avoid concentration of power.
So if you want checks and balances on employment matters, what checks and balances do you want for the State to do everything else (beyond the ballot box)?
For example, you’ve advocated heavy state spending on infrastructure, and the nationalisation of railways, as well as a State-run investment bank. Plenty of scope for abuse on those activities.
What checks and balances do you propose on them, beyond the ballot box?
That is what the ballot box is for
And it works
You clearly do not agree
Please don’t call again
Sorry, I am confused.
You need unions to provide checks and balances for matters related to employment of public services. The ballot box is not sufficient.
But the ballot box is sufficient for every other aspect of life.
Some other aspects of life
The bits intended to be decided democratically
It’s not hard to work out
Adrian
If this is intended to refer-back to what I wrote (and it was me not Richard who introduced “checks and balances”) you’re misquoting/misunderstanding me, and I feel forced to reply so as not to be misrepresented.
You solicited comment on your idea that public-sector employees have their terms and conditions unilaterally determined by officials and be invited to take or leave them – no argument, no collective bargaining, no role at all for unions (except, possibly, “consultation” which under such circumstances would be a mockery I suggest), and that into the bargain should they have the effrontery to oppose by industrial action such demeaning treatment they be pilloried as enemies of the people. I half-suspected you had your tongue in your cheek, so preposterous did such an idea seem. But I offered a reasoned rebuttal nevertheless.
I’m now regretting having responded.
If you now insist – based on some kind of purported analogy – on seeking to extend my argument to other spheres which I don’t accept as analogous (because they have no connection whatsoever with the role of trade unions in public-sector wage-determination which your original post was concerned-with), that’s up to you – but I’ve already said all I’ve got to say on that.
Robert, Richard
“All Government employees should realize that the process of collective bargaining, as usually understood, cannot be transplanted into the public service. It has its distinct and insurmountable limitations when applied to public personnel management. The very nature and purposes of Government make it impossible for administrative officials to represent fully or to bind the employer in mutual discussions with Government employee organizations. The employer is the whole people, who speak by means of laws enacted by their representatives in Congress. Accordingly, administrative officials and employees alike are governed and guided, and in many instances restricted, by laws which establish policies, procedures, or rules in personnel matters.
Particularly, I want to emphasize my conviction that militant tactics have no place in the functions of any organization of Government employees. Upon employees in the Federal service rests the obligation to serve the whole people, whose interests and welfare require orderliness and continuity in the conduct of Government activities. This obligation is paramount. Since their own services have to do with the functioning of the Government, a strike of public employees manifests nothing less than an intent on their part to prevent or obstruct the operations of Government until their demands are satisfied. Such action, looking toward the paralysis of Government by those who have sworn to support it, is unthinkable and intolerable. It is, therefore, with a feeling of gratification that I have noted in the constitution of the National Federation of Federal Employees the provision that “under no circumstances shall this Federation engage in or support strikes against the United States Government.”
F D Roosevelt in a letter to Luther C. Steward, President, National Federation of Federal Employees, August 1937
http://www.presidency.ucsb.edu/ws/?pid=15445
He was wrong
You are wrong
Don’t waste my time again
Apprenticeships as currently set up have many issues. In my experience (though I agree this is mainly “anecdotal”) there is plenty of abuse of the apprenticeship system by employers. It is not so much that they replace kids with kids, but that they take the kids on, then “drop” them shortly after if a more experienced person comes along – there is little commitment to training the young people if an easier option becomes available.
I live in the North West, where there are fewer opportunities than in almost all other parts of the country, and abuse of the apprenticeship system is certainly present. Often young people who have already acquired skills at a college are taken on as apprentices because they need much less training, for example, but the employers will only pay them as apprentices, and so on.
There seems to be many ways to abuse the system, which in my experience definitely needs more “checks and balances”.
Only problem I see is automation. Robots are taking over. So a basic income is the only way to go as far as I can see. I could also be wrong, but literally, what else is there?