Never Mind the Bankers…Some thoughts on the UK Crisis – Summer 2014

A working paper on some thoughts we’ve gathered about the current stage of crisis and current phase of struggle in the UK.

In this paper, we attempt to analyse the crisis and current phase of struggle in the UK. While the first parts of the paper set out a) the objective constraints that the crisis sets for state and capital to operate within and b) what the content of the restructuring process is and its effects on the working class, we do this primarily to set the context to focus on c) actual struggles and on what grounds they could generalise to effectively become the basis upon which the regime’s austerity strategy can be opposed. The purpose is to produce a balance sheet of recent disputes, which can re-circulated amongst different groups of workers in struggle.

This is a working paper, open for discussion, amendments, revisions. Given our current focus – working and self-organising in warehouses in West-London – we had only limited time to turn the paper into a more coherent article. We will use it for a presentation to comrades from wildcat in Germany, as well as for comrades in India – this explains why some things mentioned in this paper may seem obvious to a reader in England. We hope it will form one of the bases for the preparation of a UK-wide meeting we are planning for September with people who are interested. Drop us an email at angryworkersworld@gmail.com if you’re interested in attending the meeting and/or if you have comments on the paper.

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1) A summary – Before the crash 2008: Financial decomposition and integration of the working class

Most current proposals of the left, which claim to present an alternative to austerity are basically saying that the state and capital should withdraw from the domination of the finance sector, boost public investment through deficit spending or ‘appropriation’ of over-accumulated capital (e.g. through initiatives such as the Tobin Tax. Land Tax or other redistributive measures) and increase working class spending power. Criticisms of these proposals mainly refer to the ‘inner-contradictions’ and profit-needs of capital, which would make a ‘Keynesian’ way out of the crisis impossible. We think that this criticism remains rather formulaic if it does not historically explain how the ‘objective profit laws’ relate to and work through the historical form of class antagonism. If we look at the social situation that pushed the ruling class in the UK into adopting ‘neoliberal’ and ‘finance sector’ oriented political strategies – rather than just seeing it as a political ‘choice’ made by Thatcher and Reagan – then we can see that there is ‘no easy way back’ in the sense of Keynesian measures. The process of financialisation in the late 70s and 80s was an expression of a deeper profit crisis and of credit-based global expansion, but it was first and foremost, the only way to deal with the collective unrest of the working class.

Brief summary of historical context: from the Oil Shock to the Sterling crisis to the Winter of Discontent

The 1973 crisis slump hit hard and increased levels of unemployment in the UK, like in most other industrialised countries at the time. As was the case in many other European countries, a ‘social contract’ between trade unions, state (represented by the Wilson government) and capital resulted in a slowing down of strike activities or at least in curbing wage increases. Institutional reforms, such as giving ACAS (Advisory, Conciliation and Arbitration Service) a more dominant role in 1975, were supposed to reduce unofficial strike action. In the UK this institutional alliance between Labour and the union bureaucracy reduced the average increase in earnings from 27.6% in 1975 to 13.9% in 1976.

One sign that ‘international markets’ had little trust in the ability of the UK government to get things back on track was the pound Sterling Crisis in 1976, a dramatic and sudden slump in the pounds value. It is rarely mentioned that the IMF mobilised what was, at the time, their biggest ever loan package and in return asked for a 20% reduction in deficit spending. This, Britain’s very own structural adjustment policy, and not Thatcher, introduced ‘neoliberal measures’ in the UK.

If we take into account the two major slumps in 1973 and 1976, the social pact between Labour and trade union bureaucracy in 1975 and the internationally concerted austerity plan (IMF loans) then we can get a sense of the severity of the attacks: in this context, the strike wave of the ‘Winter of Discontent’ in 1978-9 was outstanding and a signal to the ruling class that something qualitatively different had to happen in order to take on working class militancy. One of the monetary responses was a new regulation that set interest rates at a minimum of 14%. This was introduced by the Labour government in 1979 and was in line with the ‘Volcker shock’ of the US Federal Reserve that pushed up US interest rates to an eye-watering 21%. It was this that provided the background of the push towards financialisation: it became more expensive to get credit, which resulted in large-scale bankruptcies, debt crises in the developing world and it forced ‘industrial capital’ to deal with their workers e.g. by laying them off en masse. This was a self-disciplining measure by the representatives of leading global capital.

In other countries, such levels of working class agitation as the ‘Winter of Discontent’ would have been answered with dictatorial measures (see Argentina, Poland, South Korea), but the UK had the historic (colonial past), financial (the pound’s flexibility and global character) and geographical (between NewYork and Tokyo, plus oil income to finance the transition) position to become a global financial centre. The position of the pound as the global money and London as a financial centre enabled the state to mobilise an enormous amount of credit money for a fundamental restructuring of the UK economy. And it was no coincidence that the main focus of restructuring was the (industrial) strongholds of the working class (car workers, miners, dockers, printers). Unemployment rates increased from 2.4% in 1973 to 6.2% in 1977 and 13% in 1982.

The Missing Link: The housing bubble

The essential stabilising link between the ascent of finance and working class decomposition was the housing bubble. Home ownership amongst the working class increased, both due to the financial availability of mortgages and political strategy (e.g. Thatcher’s famous Right To Buy policy that has seen 1.5 million council homes sold off since 1980). Crucially, increasing house prices allowed parts of the working class to compensate for wage losses through re-mortgaging (debt) – which was possible due to the availability of credit money through the international position of the City.

During the decade before the 2008 crash, the contribution of the finance-based ‘service sector’ amounted to about one third of British GDP. The increasing trade deficit (shrinking export of goods) was compensated for by financial inflow. In 2007 the City still clocked 1.074 trillion pounds worth of ‘foreign financial investment’, in 2008 the crash caused 490 billion dis-investment. House prices fell by 17% in 2008 – 2009.

We know what followed: an enormous effort to prop up the banking system (1.278 trillion pounds), bail-out and nationalisation of RBS, lowering of interest rates to a historic low of 0.5% in order to keep money flowing, the printing of an additional 375 billion pounds since 2009. This was not to ‘pamper the greedy bankers’, but to prop up what has been the main pillar of the UK economy since the 1980s: the international confidence in the UK as a money haven (we don’t want to underestimate the other pillars: global share in oil and mining industry, modern arms and aerospace industry, leading role in global military intervention, ‘soft-capital’ and influence amongst the ruling classes of the ex-colonies).

If we look at the situation now we can see that the so-called 2013 ‘boom’ was still based on house price increases and increased consumer debts, rather than a growth in productive investment, industrial output and exports (despite the 25% devaluation of the pound since 2009). The ruling class knows that they have to ‘restructure’ and make the economy less dependent on the City and the housing bubble, but they have apparent difficulties to do so within the constraints that have developed over time and that we have outlined above.

Here we can see how the housing bubble becomes a major stumbling block of the ruling class’ attempt of crisis management. The short-term strategy was to cut deficit spending, to enforce austerity. This causes major social discontent and here again, for political reasons home-ownership becomes a major axis of social stabilisation, which accounts for the introduction of policies that bail-out of mortgage payers in case of unemployment. In economic terms the mortgage sector is deeply intertwined with the general financial sector, the housing bubble cannot be deflated without affecting capital flows in general. At the same time, restructuring and export growth as a long-term measure will only be possible with internationally competitive wages. Compared to wages abroad, wages in the UK are high because of the enormous rent and mortgage obligations that are part and parcel of local proletarian reproduction.

Their limits for action: cutting social wages is not enough

To sum it up: while ‘divide and rule’ seems necessary in times of brutal austerity, the very basis of the ‘divide and rule’ or integration through property (home-ownership etc.) or other ‘stakes in the system’ (pensions etc.) is put into question when it comes to long-term restructuring. Seemingly irrational measures, such as the bedroom tax (which would save less than £500 million according to the state’s own figures), and seemingly ‘purely demagogic’ propaganda against ‘migrants’ have to be seen as an expression of this tension: to keep and push millions into a low wage segment without access to compensation through property-based debts. Those people who cannot take part in the housing bubble get crammed in, an example could be our current housing situation in West-London (suburban small house which was built to house a nuclear family with one bread-winner, now the rent is covered by nine incomes: one Indian family of four, double income, plus five tenants, all earning full-time wages).

It is not enough to just cut wages. The low wage sector has to be connected to a new productive basis in order to tackle the ‘productivity blockade’. Working-hours in the UK are already 16% higher than the EU average, a ‘productivity boost’ can only come from materially changing the social production process through new technology, different ‘products’ and so on. There is no generalised plan for a material restructuring as such, but we see connections between current changes in ‘knowledge production’ (casual contracts for lecturers, attraction for foreign students, new forms of cheap ‘flexible qualifications’); the shifts in production and manufacturing (turning Ford Dagenham from an assembly fortress into ‘global engine export hub); the expansion of the logistics sector (London Gateway, Dubai Port, Cross Rail etc.); development of a new ‘energy-regime’ (fracking, ‘green-lean tech); and the ‘Big Society’/Serco-isation type of restructuring of ‘re-production’, also in order to tackle high costs in social ‘care’ and policing (‘community care’, outsourcing and reorganisation of public services). Without having to credit state and capital with a cohesive plan which they don’t have we should try to see developments like ‘fracking’ and the protests against it within this wider context of general restructuring.

Our emphasis

Our criticism towards the (radical) left is that the cuts are too often interpreted as merely the ‘self-serving’ measures of unappetising Tories who want to feed their banker friends. While we don’t deny this personal aspect of the austerity regime we think that this point misses a) the systemic context of austerity, which first of all shows the weakness and fragility of their regime; b) the fact that it is not only about ‘saving money’ in different departments, but to put pressure on the social wage of the working class – from nursery cuts, to the bedroom tax, to public sector redundancies; c) which means that the working class is not merely affected as ‘receivers of benefits’, but the social rate of exploitation is supposed to be increased; d) which shifts the perspective slightly: exploitation depends on the question of how they make us work or comply with their measures, which shows their dependency on us; e) recent years have not only brought about increasing social ‘atomisation’, but also conditions which have the potentials for a more general fight-back: e.g. ‘unemployment’ or ‘the unemployed’ are not aliens, no matter how much propaganda is spewed to the contrary, but a biographical experience of nearly every worker. ‘The low wage segment’ does not only consist of isolated copy-machine operators, but for example, of cleaners in areas of enormously high urban density, of call centre workers in large offices or warehouse workers, who supply hundreds of large supermarkets with goods. We have to analyse where the austerity attack on conditions comes together with new forms of concentration (concentration of common conditions or concentration in terms of workplaces) in order to find potentials for a collective response.

We will have to look out for struggles which break boundaries from within this constellation and raise common issues concerning wages and working conditions, but also against the intensification of work and the new culture of work discipline (increased surveillance, artificial market-pressure within departments, ‘voluntary’ extra-work etc.). At the end of this paper we mention some struggles that we find significant in the current context of ‘casualisation’. Our information regarding these struggles still largely depend on the official media and here we see the main necessity for a UK-wide collaboration: to find out more about ongoing struggles, their potentials and limitations. Collective interviews, political debate about the tendencies within struggles and organised circulation of experience is the focus of our proposal.
2) What are the objective constraints for the state/capital to operate within? What is ‘their’ crisis?

In this section we want to lay out what we think are the main objective constraints that the crisis sets for state and capital to operate within. Is there economic and political scope for postponing or directing the impact of the crisis? What is their short-term and long-term strategy towards both restructuring of exploitation and political stabilisation through ‘integration’/marginalisation’ of different segments of the working class? While the left decries that ‘capital is on the offensive’, we can see that most of their attacks are signs of a frenetic ‘filling in gaps’ while new creases open left, right and centre.

Increasing debt

The public debt has increased to 1.38 trillion pounds between the crash in 2008 and the end of 2012, which is 90% of GDP – it was below 50% from the mid-1970s to 2008. In 2010 the coalition government announced that they were drastically reducing the state debt and forecasted cutting additional annual borrowing to £37 billion by 2014. Actually they had to borrow £84 billion, despite the austerity measures and cuts in the meantime. State debts are still growing and both household and corporate debts are still amongst the highest in the OECD. Despite a significant devaluation of the pound by 20% since 2009, exports did not pick up. Despite GDP growth per capita still at 8% below that of 2008 due to population increase, in March 2014 a UK ‘boom story’ of 1.9% GDP growth was reported. But this was clouded by alarming news about the growing account deficit (trade gap) of 5.4% of GDP (£22 billion) and the warning by the Bank of England in May 2014 that the over-heating of house prices and the growing ‘tail’ of indebted households threatened to burst the bubble (a house price crash ‘stress-test’ for major UK banks was enacted in April 2014).

Increasing international intertwinement

Despite the political propaganda of ‘Britain’s’ economic independence vis-a-vis the EU, economic interaction with the continent has grown and now accounts for 40% of total foreign trade. The TUC claims that the number of jobs which depend on trade with the rest of Europe grew from 3.7 million in 1997 to 4.2 million in 2011. This also means that the EU crisis has a more direct impact on the UK economy. While the media headlines announced that exports to the BRICS states have doubled over the last two years, they still only account for little more than 5% of total exports. In terms of the negative trade balance and devaluation of the pound we have to take into account that 36% of Britain’s energy sources are imported. If the pound would not have the status of a global currency, such levels of debts and trade deficits would probably have reduced British economy to a Greece type of situation.

A ‘phoney’ GDP growth

In the short-term the government has to announce further cuts and they do: Ministers expect to impose £2 billion of tax rises in 2015-16 compared to £21 billion of welfare cuts. A further £25 billion of cuts are planned between 2016 and 2018, which includes £12 billion in welfare. But cuts don’t ‘boost the economy’. In the long-term the ‘economy’ has to pick up. Even most mainstream economists agree that the ‘recovery’ in 2013, by which they mean the GDP growth, was a by-product of the government’s ‘Help-to-Buy’ program launched at the beginning of 2013, which offers interest-free loans. And with construction of new houses still 40% below pre-crisis levels, this has further fuelled house-prices (9.2% increase in 2013, in London alone 18.2%, with a record of ‘buy-to-let’ purchases and £7 billion of ‘foreign investment’, all resulting in the total wealth of private landlords at around £800 billion). Saving rates went down (the savings ratio slumped to 5.1% in 2013 from 7.3% in 2012) and house-price related consumer debts went up (a total of £1.8 trillion of credit drawn from home-ownership). This, rather than a shift to a more ‘sustainable’ economic growth, e.g. through an increase in industrial output, non-finance services, construction of homes or infrastructure or through growth in exports or household incomes, was the basis for the ‘recovery’. The Office of National Statistics announced in autumn 2013 that the production industries remain 12.1% below their pre-downturn peak, with manufacturing 8.9% lower. Capital investment levels in the first half of 2013 were the lowest since 1997 and business investment rates even lower. While mortgage lending was up, business lending fell by 4.7 billion pounds in 2013, 4% less than in 2012.

The limit of financial ‘firepower

On a monetary or fiscal level the scope for the state to ‘boost’ the economy seems very narrow. It has spent its ‘financial firepower’: higher degrees of state deficits seem dangerous in terms of the international status of the pound, meaning that state investment into infrastructure etc. is not a likely way to ‘boost’ the economy; the pound has been devalued considerably since 2008 (30% between 2008 and mid 2011, since then slight increase in value), and further devaluation would risk stifling necessary imports for energy and productive investments; the interest rates have been on ground-zero for a while, which hasn’t lead to more investments; the Bank of England has already printed £375 billion since 2009, which sets a limit for quantitative easing as a way to ‘throw money at the problem’. The new budget announced in March 2014 contains a doubling of government lending available to exporters to £3bn, a doubling of investment allowances to £500,000 until the end of 2015, and a package designed to cut the energy bills of UK manufacturers – which, all in all, does not sound too impressive. While the financial sector depends on the international trust in the world money pound Sterling the export oriented industrial sector complains that the slightest increase in the value (around 5% since mid-2001) squeezes the profit margins, e.g. in April 2014 Rolls Royce engineering group lamented a £40m profit loss due to the revaluation against Dollar and Euro.

The new focus: ‘productivity gap’

Given the narrow scope for ‘fiscal politics’ it is therefore not surprising that recently the phrase ‘productivity gap’ is one of the most used in the business media. Here is a quote from The Guardian, 20th of February 2014: “Britain’s productivity gap with its main developed country rivals is at its widest in 20 years, following the flat-lining of the economy after the deep recession of 2008-09. International comparisons released by the Office for National Statistics show that output per hour worked in the UK is 21% lower than the average for the other six members of the G7 – the US, Germany, France, Italy, Japan and Canada. The Bank of England has cited improved productivity as a key factor in whether wage growth surpasses inflation in the second half of the year, which would ease the pressure on household budgets.” This also means tackling low investment levels by the representatives of capital, which in the UK have historically been compensated by forcing workers to work long hours. While the basis for their calculation of the ‘productivity gap’ is not too clear, economists point out what state and capital have to deal with: the fact that productive investments, restructuring of the labour process, wage levels, wider labour market politics, and workers’ labour input have to be fundamentally re-shaped. Interestingly, many economists pointed out that given the low level of growth and the urgent necessity to increase ‘productivity’ the current unemployment rate might be too low: companies hire people ‘too early’ instead of making less people produce more.

Open questions

Here we see the political squeeze for the state: the short-term figures require further spending cuts and these cuts cause social frictions. The state therefore has to make sure that the cuts don’t hit everyone in the same way, the cuts have to be functional in a sense of ‘divide-and-rule’. At the same time this ‘divide-and-rule’ might contradict the necessary long-term restructuring necessary to solve the ‘productivity puzzle’, which initially requires internationally competitive wage levels in certain sectors. The wage levels will not come down sufficiently as long as house prices and rents are inflated, while in turn house prices were the main dynamic figures behind the 2013 GDP growth. We don’t want to be the better economists and we can’t be. If we analyse ‘economic figures’ we just want to understand broadly what the constraints of our enemies are and what we can expect: are we facing a Greek-style severe recession? Is another ‘Sterling crisis’ like in 1976 possible or likely? How much scope does the state have to react to social unrest by softening the austerity regime? What is broadly their main line of attack? At this point we should change the perspective and look at the impact of the cuts and general crisis impact on the working class and its internal segmentation.

3) Impact of the crisis and austerity on the working class

This section looks at how the crisis and austerity impacts on the working class at large in terms of the social and household wage, working-times and contractual relations. The aim is clear: what does it all mean for potential working class collectivity? We want to see what kind of tendencies there are which generalise conditions within the working class and what are tendencies which reinforce or create new lines of division. We think this is important in order to really grapple with the changing realities of our lives and social relationships, which then becomes the basis for our self-organisation. Looking at how these changes are being mediated by political and trade union institutions acting within the working class is also crucial to our understanding of the barriers, frameworks and often wildly divergent agendas which make up the current field of ‘organising’ in the UK.

If we look at the conditions of the working class it is difficult to distinguish which of the impacts are ‘economic results’ of the crisis, which are the product of rather headless cuts to reduce the budget deficit in the short-term, and which are outcomes of a more strategic restructuring attack. If we look at the first round of austerity in October 2010 we can see that the state administration had little understanding of how cuts in various and separate departments might accumulate within a modern proletarian household, which depends as much on the EMA (school student subsidy) as on working tax credit or a frozen public sector income of other household members. There was a fair bit of re-adjustment going on, not only after the London Riots in 2011.

a) Impact of crisis and austerity on proletarian income and working-time

Firstly, real wages (per person, excluding social wage elements, such as public services) across the board have been falling, counter to recent misleading newspaper reports that wages have finally overtaken inflation (their calculation of ‘increase’ included bonus payments of upper management and their ‘inflation’ excluded increase in housing costs). While real wages have grown consistently – by 2.9 in the 70s/80s, 1.5 per cent in the 1990s and 1.2 per cent in the 2000s – they’ve fallen by 2.2 per cent since early 2010 (although the TUC alleged in April 2014 that real wages have actually fallen by 7.6 per cent since 2008). The wage decrease is particularly obvious when compared to house price developments: between 1997 and 2012 house prices had increased more than threefold, from £75,762 to £253,816, while average wages had only gone up by £16,500 to £25,932. As we already mentioned, this situation was sustained largely to the very low interest rates for mortgages. Between 1997 and 2011 private rent increased by around 60%. In most London boroughs workers who rent privately spend at least half of their wage on rent, the UK average is 40 per cent of income.

Added to this, the social wage made up of the services and direct payments provided by the state for our subsistence e.g. health services, childcare, unemployment benefits and social housing, have, as we all know, been subject to major restructuring and cuts. This adds to the burden of proletarian existence, not least in the growing levels of ill health and depression that cannot be catered for by the system built around fixing us up and putting us back to work. Some of the (social) wage cuts are the direct result of state policies: a public sector pay freeze which has resulted in a 5-10% real wage loss; cuts to a whole range of social services and childcare provision; cuts to benefits; and tax changes that have left the poorest the worst off in relative terms.

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* Pay freeze: imposition of a pay freeze for public sector workers and benefit claimants in 2010 and 1% increase in 2013, which by 2014 resulted in a 5-10% real wage loss; currently in May 2014 UNISON ballots 600,000 members whether to accept another 1% offer from the council management
* Cuts to social services: social wage cuts through departmental cuts in social services (nurseries, health, education), equalling an annual loss of £7,000 for a working family.
* Benefit cuts: direct benefit cuts: bedroom tax; capping of the annual bill for tax credits and housing benefit to £119.5bn in 2014; cutting funding for council tax credits by £500m, which results in 300,000 to 600,000 poor families having to pay between £80 and £120 extra a year; cutting Independent Living Fund (ILF) in June 2015, affecting 18,000 disabled people; and £215 million cut in legal aid [1]
* Tax changes: as a result of the government’s tax changes a couple with children, with one parent working, will be worse off by £3,720 (over the period 2011 to 2015). A couple with children, with both parents working, will be worse off by £2,073. The figures include the affect of the VAT rise from 17.5% to 20% in January 2011, cuts in tax credits and child benefit.

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Secondly, and not surprisingly, lower wages and a higher degree of casualisation has lead to an increase in working-hours – of 11% between 2010 and 2012 by people in full-time positions. Unpaid overtime is more common in the public sector, with more than one in four public servants doing almost 8 hours of unpaid overtime a week compared to around one in six of workers in the private sector. The increase over the last decade is almost entirely driven by more than a quarter of a million extra women doing hours for free. This is largely because many more women are working in the public sector, which has bore the brunt of most of the cuts, and which subsequently has produced a much more stressful and burdensome work environment: people are made redundant or not re-hired, leaving existing staff with bigger workloads and fearful that resisting such measures would mean they’re next out the door. The situation in hospitals is now so bad that cleaners can be expected to feed patients. It is the norm that wards are under-staffed and nurses are suffering from enormous workloads and stress. Teachers, three quarters of whom are women, are having to undertake more bureaucracy and work longer, being subject to Ofsted inspections, special measures, new planning and performance tracking and practices etc.

While England has historically always had longer working hours than the rest of Europe, this recent increase at a time when childcare, rent, energy and general subsistence costs are high, places even more pressure on people, their relationships and ability to make ends meet.

b) The income gap increased in the crisis

We can state the obvious and say that since the crisis society over all has become more ‘unequal’ in terms of income. The five richest families own more wealth than the poorest 20% of the population – their income obviously not depending on wages. In terms of wage earners the gap between the 10% top-earners (average annual pay of around 80,000 pounds) and the lowest tenth has increased by 5%% since 2000. One of the biggest food-bank coordinator, the Trussell Trust, claims that in 2013 the number of people who have received food-bank aid has doubled: 400 Trussell food-banks provided food for 614,000 people in the first nine months of 2013.

The income gap has exacerbated already existing regional differences, mainly between the north and the south, as well as between London itself. 79% of all private sector jobs created in the UK since 2010 were created in London. Most of the UK public investment goes to London (e.g. some of the largest European construction projects like the Channel Tunnel Rail Link and Crossrail), in order to boost the city as the centre of finance and housing bubble. Levels of UK internal migration from the North and West towards the South-East is significant. If we see the question of ‘Scottish independence’ also as a question of uneven development between a more ‘manufacturing’ based poorer north and a ‘financial’ and richer south, then the answer given by the English media is telling: “An independent Scotland would face an immediate debt repayment of £23bn to the UK Treasury, equivalent to more than a third of its entire spending. [2]

c) Income and employment gap between ‘generations’

The pay gap between younger and older workers has risen by more than half since 1997, with those in their 50s in 2014 earning 2.6 times more than workers aged 18-21, compared with 1.7 times in 1997. Median gross weekly wages have fallen by more than 19% in real terms since 1997 among workers aged 18-21. While general employment levels increased, in particular because (female) workers over 50 took part-time jobs to provide an additional household income, the employment rate amongst young workers contracted. Between April and June 2008, 13% of the economically active population aged 18-24 was unemployed, a figure that had increased to 19% by the same period of 2013 (a total of 912,000 unemployed aged 16-24). This ‘generational gap’ expresses itself also in the current budget, where the government assures the ‘older voters’ that pensions are the only part of the welfare bill to be ring-fenced by a “triple-lock” guarantee, while at the same time they announced a plan to abolish housing benefit for under-25s. This means that the ‘generational gap’ turns into a re-enforcement of the family structure and a generational economic dependency: 3.3 million young workers can’t afford to live independently or are unwilling to bear the substantial drop in living standards this would entail. The proportion of such youth is now one in four, the highest level since 1996.

d) (No) return to the family

On one hand the austerity measures push people back into the family as a ‘last resort’, which is the material basis for the ‘reactionary moralist turn’: public discourse about, and attempts to change abortion laws, changes in the configuration of reproductive health services, e.g. outsourcing to Christian charities that make it more likely that more babies are born etc. On the other hand the crisis increasingly undermines the family (cut in childcare provisions etc.). First of all working class women have to juggle with these contradictory tendencies. There has been a steady rise in the numbers of stay-at-home mums, mainly amongst poorer women, while employment participation of women above 50 are at record highs. The material basis for this more traditional ‘return to the family’ are prohibitive childcare costs that make it financially unviable to work, particularly in the low-waged sector that many groups of poor women are being pushed into. This is exacerbated by the major cuts to childcare services including Sure Start children’s centres – 55% have abandoned onsite childcare, and a fifth are now charging for services that were formerly free. A fifth have reduced the number of qualified teachers and a further 20% reported they would have to reduce childcare staff. With the average cost of childcare at £405 a month, most working class women believed they needed to earn an average of more than £26,000 a year to make it worth returning to work. At the same time unemployment benefit changes and public shaming of ‘proletarian young single mums’ are supposed to push women into work earlier on wages that wouldn’t cover the full costs of childcare.

e) General tendencies of downward wage pressure

We can see a double pressure on wages: a) through an increase of sanctions and cuts targeting unemployed workers and migrant workers and b) through attacks on the ‘privileged’ workers in the remaining ‘strongholds’. These strongholds (Royal Mail, certain parts of the public sector etc.) are increasingly undermined by outsourcing into the low-wage sector. The growing pay gap within the working class is political pressure on these workers. The trade unions have found little answers or are co-managing the outsourcing process. In the following we give different examples of how the austerity regime tries to put pressure on the general social wage level by attacking:

* public sector workers
* workers in allegedly ‘permanent’ or even ‘privileged’ jobs in the ‘private sector’
* migrant workers
* unemployed workers
* proletarian residents

If we see these attacks on the level of a proletarian household then we can see that they are not ‘separate’ attacks, but that they have a combined impact: they are meant to expand and politically stabilise the low wage segment of the labour market and force people to take and/or keep poorly paid jobs with shitty conditions. After looking at these attacks we briefly analyse the composition of the low wage segment.

* Public sector workers

Since 2010 we have seen many direct attacks on local public sector workers, which make up around 5.6 million out of 30 million employed people in the UK and out of which two thirds are women. Since 2009 many public sector workers were asked to reapply for their jobs, accepting worse terms and conditions, including significant pay cuts of around 5%. The local state made use of an employment legislation called the section 188 notice. Workers are given 3-months notice of the intention to terminate their employment – the mandatory “consultation period” for redundancies. In 2010 many councils made use of this, e.g. Birmingham (workforce 26,000), Sheffield (8,500 workers), Walsall (8,400 workers), London Borough of Croydon (4,000 workers), Northumberland County Council (14,780 workers). Usually a significant share of workers were not ‘re-hired’, which resulted in a total loss of 500,000 public sector jobs between 2010 and end of 2012, out of which around 30,000 were cut in the NHS. These tactics of having to ‘re-apply’ for jobs is obviously also used in the ‘private sector’, in particular in outsourced companies attached to the public sector and the NHS, where 20% wage cuts are common. Other strategies to cut wages and to increase pressure and divisions within the public sector are, f.e. the introduction of performance related pay for teachers (and the Labour announcement to introduce annually re-assessed ‘licenses’) and the recent decision, that half of the NHS workers will only get their ‘performance based’ wage increase, while the remaining half are offered a 1% annual ‘increase’.

* Workers in allegedly ‘permanent’ or even ‘privileged’ jobs in the ‘private sector’

While the restructuring in the public sector is part of a ‘political discourse’, most of all the changes within the NHS, the restructuring in the ‘private’ sector is seen as a company’s internal private matter. Currently export-oriented manufacturing, such as the automotive industry (80% of the 1.5 million passenger cars manufactured in the UK are for export and most of the 3.6 million engines) and the aerospace industry (the UK is the world’s second largest manufacturer of aerospace parts) undergo quite significant changes. The former ‘workers’ fortress’ Ford plant in Dagenham has slowly been down-scaled from an assembly plant to Ford’s biggest global ‘diesel engine hub’, manufacturing engines for many assembly plants around the globe. This intensifies the intertwinement of the global industry and puts additional pressure on ‘local workers’: end of 2011 Ford introduced a two-tier wage system, newly hired workers are paid around 15% less than the existing work-force; the new entry wages for permanents (there are many lower paid temps) are 12.89 P/h. These changes are often enforced through black-mailing with or actual job cuts, e.g. 200 jobs were cut at Rolls Royce plant in Scotland (half of the new-built big passenger jets around the globe have Rolls engines) and 340 jobs at Honda in Swindon in early 2014. The changes in these ‘global factories’ affect many people, e.g. in the UK automotive industry 180,000 directly employed workers; but they are hardly publicised and debated, despite the fact that they cause a significant downward pressure on wages in general.

* Migrant workers

The high(er)-paying jobs in the finance and finance-related service sector are catered for by a large army of mainly migrant workers in cleaning, hospitality, retail, warehouses, construction and the care sector. The UK economy depends on this migrant workforce as the main constituency of the low-wage sector. There were many signs of a new confidence amongst recently migrated workers, from struggle in logistics in Italy to ‘wage struggles’ of ‘illegal’ workers in France to cleaners’ mobilisations in London. Since the 2008 crash the state pressure on migrant workers has increased, though very selectively, from raids against ‘illegals’ (around 400,000 to 800,000 workers in the UK have no legal status) and militarisation of the border regime to tighter benefit regulations for EU migrants. Tories and Labour both propagate various restrictions for EU migrant workers to claim benefits (e.g. Boris Johnson suggested that EU migrants should first work for two years before being able to claim while Labour wants more ‘skill-based’ selection), although it is commonly known that EU migrants are 30% less likely to claim any benefits compared to ‘UK local workers’.

Since March 2014, EU workers are only entitled to in-work benefits if they earn at least £150/week (equivalent to 24 hours on the minimum wage); from April 2014, they will not be entitled to Job Seekers Allowance (JSA) before having worked for at least 3 months, nor to housing benefit if they are out of work; from July 2014 EU-migrant workers will need to live in the UK for three months to claim child benefit and child tax credit. In addition the government debates the introduction of charges for accident and emergency (A&E) treatment for temporary migrants and overseas visitors – a purely ideological measure to blame ‘migrants’ for the financial misery of the NHS. This tendency of ‘having to pay’ is already spreading, e.g. with the introduction of charges for crutches and neck braces for ‘British’ citizens’.

The political class knows that the local economy depends on ‘cheap’ migrant labour and external pressure on the labour market. At the same time they need scapegoats for their austerity program. For them the question is not to ‘keep migrants out’, but of how to transmit labour migration into a general dynamic within the labour market: a higher inflow of EU workers in combination with more restrictive benefit regulations for both migrant and ‘local’ workers has lead also to a higher degree of ‘local workers’ taking on lower paid jobs. The Office for National Statistics showed a net flow of 212,000 migrants to Britain in the 12 months to the end of September 2013. This compared with 154,000 in the previous year; at the same time more ‘British-born’ workers are entering the low-wage sector: “The number of British workers in low-skilled jobs is now rising at a much faster rate than the employment levels of foreign nationals in similar roles, reversing a decade-long trend, according to a Home Office study. The latest labour market survey figures show that British nationals accounted for 367,000 of the 425,000 extra people in work in the UK over the past year.”

* Unemployed workers

It is difficult nowadays to pinpoint a figure of ‘the unemployed’, almost five million people have claimed JSA at least once in the past two years. Phases of unemployment are now totally normal for many workers. The official figure of unemployed people end of 2013 was 2.33 million, an unemployment rate of 7.2%, while only 1.17 million claimed JSA. The long-term unemployment rate (longer than one year) is at 2.3%. The lower number of JSA claimants indicates that either workers don’t bother claiming ‘in between jobs’ or are discouraged by an increasing pressure on claimants and social stigma that recurrently gets stoked by the media e.g. Benefits Street (TV programme).

Around 19% of all JSA claimants in the period from April 2008 to March 2012 were sanctioned – a total of 1.4 million people. The number of sanctions in the year to 30 June 2013 was around 860,000, the highest number in any 12-month period since statistics began to be published in their present form in April 2000. ESA sanctions issued to disabled people have increased by 156% in 2013. According to government figures, in 2013 around 133,000 sanction decisions had been overturned after appeal—400 a day, which shows a considerable degree of individual resistance. The increase in sanctions has another correlation: According to the DWP figures, there was a 45 per cent rise in incidents of physical assault in job centres, with 672 incidents in the year 2012-13, compared to 465 in 2011-12. In the same period, incidents of verbal abuse and threats increased by 53 per cent to 35,161 from 22,928 whilst the number of ‘other’ incidents – including damage to property or fights not involving staff – doubled to 6,399.

In April 2014 the government introduced the ‘Help to Work’ scheme for for ‘long-term unemployed’: “To continue claiming JSA, claimants will have three options. To accept a community work placement, such as making meals for the elderly; to visit a Job Centre every day; or to take part in further training. The government calls this “intensive jobcentre support”. Anyone who refuses will face losing a month’s worth of benefits. If they refuse again, they could lose three months of benefits.” Most of the ‘work fare’-programs don’t actually work: the private companies don’t want to spoil their work regime by potentially less motivated doleys and the ‘public or charity sector’ depends on wage funding, for which there is actually little money. We can assume that the program remains yet another Damocles sword of sanctions.

* Proletarian residents

As mentioned earlier, private house property was and is a major way of integration and is a major dividing line within the working class. One of the first announcements of the state in 2009 was that people who lose their jobs and have to pay off their mortgage will get easier access to the Support for Mortgage Interest (SMI) scheme and a Mortgage Rescue Scheme was set up in January 2009 with a budget of £285 million. The increasing numbers in re-possessions after 2009 showed that these schemes were largely ideological. In October 2010 the government cut the interest rate at which SMI is calculated from 6.08% to 3.63% saying the high level meant 90% of claimants received more SMI than their mortgage was costing in interest, enabling some to use the excess to reduce their borrowing. We can see the state’s difficulty: on one hand they cannot let people off the hook and debts have to continue working as a disciplining factor; on the other hand they depend on the housing bubble as an economic pillar, so schemes like the recent ‘Help-to-Buy’-program keep on pushing people into the mortgage market.

On the rent side the state faces further imbalances. Rent as share of wages is increasing, and in this sense the large housing benefit budget is not a mere ‘subsidy for banks and private landlords’, as some leftists complain. It is a way to deal with the contradiction that while the house price hikes are necessary for financial inflow, if high house prices and rent increases inflate wages this puts the competitiveness of British industry at risk. In this sense housing benefit is (also) a wage subsidy for British-based companies. There are now 4.3 million people renting privately, and a million more will join them in the next few years. The fastest-growing group of private tenants are not students leaving university, but people between 35 and 44, often with children. Over 80% of new housing benefit claimants since 2010 are working, demonstrating that stagnant wages and sky-rocketing rents are simply making housing unaffordable for more and more people.

This problem cannot be solved through monetary tricks – and large-scale government spending for construction of (social) housing is unlikely. Consequently we have to see ‘the bedroom tax’ not just as an attempt of the government to ‘save money’ (officially expected savings were only 500 million pounds in the first place), but to put pressure on proletarians to live in less space. Introduced in April 2013, the policy imposes an average penalty of between £14 and £22 a week on working-age social housing tenants deemed to have more bedrooms than they need; Around 600,000 people in the UK are affected by the bedroom tax, which is a third of all of the existing working-age housing benefit claimants in the social sector – although this is mainly a problem outside London where there is more the opposite problem of overcrowding in social housing. Two-thirds of households in England affected by the bedroom tax have fallen into rent arrears since the policy was introduced, while one in seven families have received eviction risk letters; The number of tenants in England and Wales forcibly evicted from their homes after court action reached a record high in 2013. Some 37,739 private and public sector tenants had their homes repossessed by court bailiffs – the highest number since 2000. However, the number of homes being repossessed by mortgage lenders at the end of 2013 was the lowest in a decade. Banks and building societies reported that 28,900 homeowners had their property repossessed in 2013.

* Other forms of social repression

Austerity measures and crisis increase the likelihood for social unrest and an increase in ‘crime’, while cuts to the state apparatus cause problems for an old-school type of ‘law-and-order’ enforcement through heavy policing. Total police officer numbers in England and Wales fell in the 12 months to September 2013 by 2.6%, or 3,488, to 128,351. Cop numbers are now 15,995 below their historic peak of 144,353 in September 2009. The total police workforce appears to have fallen by just over 30,000 during the same period. The scale of the reduction in uniformed officers is in line with predictions made when the 20% cut in Whitehall funding for the police was announced as part of the package of austerity measures in 2010. If they cut in ‘work’-force, they have to replace it with machinery: referring to the 2011 riots in January 2014 the Association of Chief Police Officers (ACPO) called on the government to introduce the use of water cannon to police forces in the UK and they had a look at the second-hand water-canon market in Germany.

While cutting police officers, the Home Office proposed a new ‘anti-social behaviour, crime and policing bill’ in 2013, which would re-define anti-social behaviour. Human rights groups denounced this new bill (which has been put on hold for the time being), because: “it will allow *private* companies to impose Injunctions to Prevent Nuisance and Annoyance (IPNAs) – replacement ASBOs. Breaching an IPNA could result in your house being repossessed, and the conditions of an IPNA can be more onerous that those of an ASBO. The “offences” that can lead to an IPNA being imposed are so broadly defined that many important activities, most importantly lawful protests, can be labelled “annoying” and lead to draconian conditions being imposed.” We have seen the extension of ‘anti-social behaviour’ to various types of situations: e.g. squats were evicted by dishing out ‘local bans’ to squatters for alleged ‘nuisance’ or in early 2014 an ‘islamic fundamentalist’ was banned from public preaching, declaring his sermon as ‘anti-social’. Often the initial contact between ‘the anti-social elements’ and the state is not via the police, but through the lower-ranks of the local state apparatus, such as community officers. The state will have to expand the ‘quasi-police’ status to all kind of other ‘public or private’ agents in order to compensate for the police budget cuts.

Similar contradictions arise when it comes to the prison system, which is also affected by the budget cuts: in April 2014 the government announced to cut the prison budget by 2,200 pounds per prisoner per year. The government plans focus on ‘privatisation’ of prisons and ‘concentration’ of prisoners, e.g. in a 2,000-place prison in Wrexham or a second giant-sized institution in West London. Since 2010 there have been 13 closures of smaller prisons and a further six still to come. The top three supersized jails are all in the private sector: G4S-run Oakwood (1,600) Birmingham (1,436) and Sodexo-led Forest Bank (1,348). Concentration and privatisation is due to the fact that the National Offender Management Service (NOMS) has to make overall resource savings of almost 25% in real terms by 2014-15. The spending review saw a further 10% reduction in the Ministry of Justice’s budget. The prison population in England/Wales has doubled in the last twenty years (149 prisoners per 100,000 UK residents; in France 102; in Germany 83) and the average sentence in 2012 was 2.7 months longer than in 2002. While many people focus on the unaccountability of these new privately-run prisons and their brutality the new workforce inside these prisons is worth looking at (proletarianisation of ‘guards’, which might make them less reliable; but these private guards also become agents of ‘brutalisation’, as a result of increasing tensions inside the prisons). [3]

There has also been a return to ‘blacklising’, most prominently the case of blacklisting in the construction industry in 2009 (Balfour Beatty, Carillion, Costain, Kier, Laing O’Rourke, Sir Robert McAlpine, Skanska UK and Vinci Plc), organised by private ‘consulting companies’, which show a close link to state institutions. In April 2014 the public Information Commissioner’s Office (ICO) passed on an updated list of 3,200 names of blacklisted workers to the original black-lister Consulting Association. Other changes in the legal system affect the working class in their legal individual disputes with the bosses. As part of the budget cuts the government introduced higher charges for workers wishing to have their cases heard in front of the industrial tribunal. It now costs £250 to lodge a claim with tribunal hearings charged at between £960 and £1,060. Since then the number of disputes which reached tribunal stage fell by a staggering 79 per cen (between October and December last year, compared with the same period in 2012). The state slashes the general legal aid bill for criminal and civil cases by 2 billion pounds by 2015 – a drop of almost a quarter.

* Composition of the low wage segment

Socially the extent of the ‘low wage segment’ is largely kept invisible. While the question of ‘benefit claimants’ and general poverty is more widely debated, either to blame or to pity the ‘poor’, the fact that increasing numbers are working for a poverty wage is ignored. A modern capitalist country can deal with ‘marginalised sections’ by stigmatisation, social welfare or control, but if its representatives have to admit that not only does the system have little to offer to ‘hard-working’ people, but that the expansion of the low wage sector and increasing work pressure is the only way out of the crisis they can propose, then this looks too bleak for their taste. It also sheds a different light on their ‘recovery’, once we emphasise that four out of five jobs created after 2010 belong to the low wage segment (wages below 60% of average pay, meaning around £7.70 p.h.).

The state’s announcement in March 2014 that the minimum wage will only be raised by 19p (from 6.31 to 6.50 p/h) was also a political statement. The minimum wage has become a threshold for many working class people – which does not rescue them from the spiral to the bottom, but on the contrary, prevents them from asking for more. In this sense it is of major importance politically when workers – in particular female, migrant workers like in the case of the Medirest workers strike – openly say that they strike against the minimum wage. As a sidenote: some people might argue that an increase of the minimum wage to 7 or 8 p/h would not actually result in higher monthly incomes, given the consequent reductions in working tax credit (currently you can get around 200 pounds per months working tax credit if you work full-time on the minimum wage). Here we can see a difference between the relation to the direct wage (paid by the company you work for, together with others) and the ‘social wage’ share (a benefit paid by the state administration, which you face as a claimant, often more individualised).

How many workers are part of the ‘low wage segment’? According to the TUC there are around 1.2 million workers on the minimum wage of 6.31 p/h and 5 million workers who earn less than 7.5 ph. Then it is difficult to tell whether this includes:

* 168,000 workers on ‘unpaid’ work-fare programs in 2013, highest number in fifteen years
* tens of thousands workers on unpaid internships
* 279,000 young workers who receive less than the minimum wage
* around 4.3 million officially self-employed, mostly on low income (perhaps an exaggerated figure)
* around 500,000 apprentices, who are paid as low as 2.6 ph for the first year;
* 1.46 million people, working part-time because they could not get a full-time job, meaning that their weekly wage is way below a full-time job

While the official unemployment level is not that high, the enormous pressure on wages can only be maintained by a ‘simulated underemployment’ through casualisation and ‘insecure’ employment. The share of zero-hour contracts, agency work, apprenticeships, self-employment and other ‘non-permanent’ jobs have increased considerably over the last five years.

* Agency (temp) workers
The number of temporary workers increased by 89,000 in the two years to end of December 2012, to reach 1.6 million. The UK’s temporary workforce has jumped by 230,000 since 2005, while permanent jobs have fallen by 8,000.

* Part-time workers
There are currently over eight million part-time workers in the UK, nearly three-quarters of whom are female. However, the proportion of men working part-time today is at an all-time high, with the number of male part-time workers more than doubling in the last 20 years. Between 2009 and 2012 the number of people on part-time positions increased by 500,000. The 36 per cent pay gap between part-time and full-time workers is the main barrier to closing the gender pay gap. Whereas ‘part-time’ has previously been synonymous with women with children, allowing them more workplace ‘flexibility’ to also carry out the lionshare of childcare duties, it has also always been used to drive up productivity: in practice it allows the employer to cut their wage bill without the workload, 5 days of which is now squeezed into 2 or 3.

* Zero-Hours workers
The official numbers are not reliable: they state that in 2013 there were 583,000 workers on zero-hours contracts in the UK (85,000 in Scotland), the current figure (April 2014) is 1.4 million. Other sources claim that 600,000 care workers alone are on zero-hours. Most agency workers have zero-hours contracts. Wage differences between ‘permanents’, ‘agency’ and ‘zero-hour’ workers are significant: average gross hourly pay is 13.39 for permanent workers, compared to 10.93 for agency workers and 8.83 for those on zero-hours contracts.

* ‘Self-Employed’ workers
In 2013 there were around 4.3 million workers officially self-employed. In the years from the start of the recession in 2008 to 2013 the number of self-employed workers increased by 333,000 compared to a fall of 201,000 in the number of ‘waged workers’. Self-employment accounts for 44% of the net rise in employment since mid- 2010. Self-employed workers incomes have dropped 20% between 2006 and 2012. Self-employed women earned 40% less than self-employed men in 2012. the average income for a self-employed man was £17,000, the equivalent for women was just £9,800. In addition: since 2000 there are 1.2 million more self-employed businesses, making a total of 3.7 million. Not many of them register mega-incomes. One characteristic of self-employed businesses is that most report incomes small enough to fall under the VAT radar (currently £79,000). Only 100,000 of the businesses that have sprung up in the last 14 years are VAT registered. For us the strike of electricians on London construction sites (April 2014) against forced self-employment, for ‘a wage contract’ is an important sign of counter-attack.

* Apprentices
Apprenticeships are a very obvious means to pay cut-rate wages, given the low £2.60/hr rate payable for the first year (and for the whole term if workers are 19 years and under). The minimum wage for apprentices was brought in by the government in November 2010. Since then the number of apprenticeships has increased spectacularly: up 58% to 442,700 in October 2011, compared to 2009/10 figures. And the number of over 25s in apprenticeships has gone up 257%.

4) Where are tendencies which bear a potential of overcoming divisions within the class?

What are the struggles we perceive, what do we know about them and how? How do they relate to the wider crisis and the attempt of state and capital to solve it? Which struggles therefore pose a potential threat to the regime’s strategy? What are struggles individual internal and external limits? Which struggles are or would be able to become focal points of reference or attraction for other workers and why? How do we see the ways in which the wider left approach these struggles and how do we think a fruitful engagement with these struggles could look like?

Number of official strikes

We first have a look at general trends regarding industrial disputes. Official strike statistics don’t represent the actual degree of discontent, but can provide us with some indicators. The following numbers relate to the period 2009 to 2012, the most current figures available.

2009: 98 strikes, lowest figures since 1992, 455,000 working days “lost” (sic!), most strikes about redundancies, 49 strikes in public sector
2010: 92 strikes, 365,000 working days lost, most strikes about redundancies, 47 strikes in public sector
2011: 149 strikes, 1.4 million working days lost (highest since 1990), 48% of strikes about pay (including pay cuts), 88 strikes in public sector, 103 strikes in the North-East of the UK, no strikes about ‘working conditions or disciplinary actions’
2012: 131 strikes, 248,800 working days lost, 46% of strikes about pay (including pay cuts), 63 strikes in public sector, large number of stoppages (47%) lasted for only one day, involved 91% of workers and accounted for 187,900 working days lost (76%)

Average number of working days lost in the
1970s (12.9 million)
1980s (7.2 million)
1990s (660,000)
2000s (690,000)

The number of official strikes has risen from 98 strikes in 2009, the lowest number since 1992, to 131 in 2012. There has been a shift in the reasons for strike action from being mainly about redundancies, to being about pay cuts. The big number of days ‘lost’ due to strike in 2011 was due to the 30th of November public sector strike over pensions, when around 2 million workers stayed away from work – the closest to a ‘general strike’ that the crisis has produced in the UK so far. It is interesting to see that in the following year the numbers of strikes and the days lost due to strike in the public sector were at a historic low. Another interesting observation is that when it comes to sectorial categorisation of strikes, the most strikes in 2012 happened in “Transport, Storage, Communication, Information” (total of 36); but this ‘sector’ was subsumed under the overall category of ‘Services’.

Political quality of struggles

More important than these official figures are the actual quality of strikes. Here we would have to engage in a political debate about the specific potentials and limitations of struggles since 2008, e.g. Lindsey as the first and contradictory ‘wildcat’ action after the onset of the crisis, where refinery construction workers struck against the outsourcing to a company employing ‘foreign’ workers; the occupations at Visteon, Vestas and other companies against closure (2009); the university and school student mobilisation and the British Airways strike, which took place after quite severe legal repression (2010); the Southampton council workers strike and dispute in Plymouth over the council’s attempts to force workers to sign ‘new contracts’; of course the riots, the public sector strike over pensions (2011), the electricians dispute against the introduction of new skill and pay scales (2012) and the recent struggles within the NHS and education, which addressed, amongst others, the common question of ‘performance related wages’. Even here we will notice that our perspective is still too superficial and dependent on the ‘official media representation’ of disputes.

The list below of recent struggles which ‘stood out’ is still random and sketchy. Many struggles touch upon ‘common questions’, even a strike for higher wages can obtain a more political and general dimension in times when state and capital want to enforce a ‘permanent pay freeze’. Similarly, strikes which question the concrete wall of the minimum wage or question the division between core workers and temps or outsourced staff. But just the fact that many problems are ‘common problems’ now does not mean that struggles develop an attraction and become reference-points of other workers. What is necessary in order for struggles to become focal points? First of all they have to show that they are powerful enough, which in most cases would require to go beyond given contractual divisions amongst workers or even beyond the legal prescriptions of the labour and industrial dispute laws. In a second step the workers in struggle would have to make an extra-effort to address other workers and not rely on the trade union structure or the media to do this. These cases are rare. In general, in the current phase those struggles seem of particulate interest to us, which challenge:

* the process of ‘re-application’ for jobs or the black-mailing ‘job cuts’ vs. ‘accepting worse conditions’
* the pay freeze
*the minimum wage
* casualisation (zero-hours, agency work, self-employment)
* the division between permanent and temps
* the atmosphere that migrant workers have to accept any conditions
* the pressure to do ‘unpaid labour’ (voluntary work, cuts of social services)
* the acceptance of property law over need for housing etc.

Struggles against the minimum wage and casualisation

Strike against zero-hours: Hovis, September 2013
The strike at the Hovis bread factory in Wigan was presented as a victory in the struggle against zero-hour contracts. Around 400 workers had been on strike for two weeks. In the end management agreed that no agency-staff on zero-hour contracts will be used, instead the extra-work will be done as overtime by the permanent work-force – which is slightly different from winning permanent contracts for temporary or zero-hour workers. Although we can say that the strike was important and successful, it does not take into account that the Hovis workers did not fight together to stop the closure of the Hovis distribution plant (200 jobs) and two other factories near Birmingham (900 jobs) in the previous year.

Strike against zero-hours: STM Security Group, London Overground, May 2013
In May 2013 the strike of security and safety staff employed by STM Security Group on the London Overground was also presented as a struggle against the zero-hours contracts of the workers. Instead of a full-out strike the trade union found some loopholes to engage in work-to-rule, which would trouble the security company. The management reacted by refusing to continue employing eighteen of the workers, they were just not able to clock-in online. Being employed on zero-hours the company thought that no legal obligations would follow. The RMT said that this would be a ‘lock-out’ and managed to ballot RMT members on Overground and Underground about the ‘impact of employment of agencies’, which was a difficult legal construction, given that secondary action (solidarity strikes) are not allowed. Transport for London reacted by putting pressure on STM to solve the conflict. In the end STM agreed to better conditions for the workers. RMT activists said that it was very difficult to ballot permanent workers about this issue, given that they themselves are under pressure and feel that the London Transport bosses are looking for an excuse to have an ‘all-out’ dispute. We can say that this is an exceptional case, given the high degree of trade union organisation in London transport, which most workers on zero-hour contracts won’t have in the background. During recent RMT, NHS, and fire fighters strikes we saw a dead-end in addressing other proletarians as ‘service users’ rather than other workers who are also under pressure of job cuts or casualisation and who depend on state services (transport, health service), rather than ‘use it’; but this would throw up differences in conditions between these (better paid workers) and other workers.

Strike against self-employment, London Underground, April 2014
Self-employed electricians on a London Underground construction site went on strike in order to be taken on directly on full pay rates agreed under the JIB national agreement. A union rep said that these types of conflict could spread like wildfire, given the high degree of ‘false’ self-employment in the sector. A week later electricians on the Crossrail construction site also went on strike.

Strike against the minimum wage: Medirest, Ealing Hospital, March 2014
During March and April this year, cleaners, porters, housekeepers and canteen staff, all sub-contracted to Compass Medirest – ‘the world’s largest supplier of catering and support services’ – went on strike for better wages and conditions. Under their contract, they received minimum wages, even though many of them had been working at Ealing Hospital for 10-15 years. The strike was ‘unusual’ in the sense that the workforce were largely first generation migrants, mainly older indian women who had never struck before (although there were also some other workers that probably had some struggle experience in their former jobs e.g. male, middle-aged cement worker from Gujarat, male middle-aged guy from Kerala), and even though it was supported by the GMB union, there was a rank and file feeling about the picket, people getting drunk, being exuberant, chanting at the manager who came out to tell them to stay on the roundabout (there was an enforced limit to how far they had to remain from the hospital entrance). The dispute was over the fact that other Medirest workers in different hospitals were being paid one or two pounds more, and they were on minimum wages without even sick pay. They staged 2 two-day strikes, followed by a seven-day strike and were about to embark on another 7-day strike when management gave them an extra pound and 2 days holiday.

While the initial request for a wage increase was submitted to management a year before they went on strike, their modest win should be seen against the background of the largely more defensive struggles that have taken place across the public sector for example – and which have not bought even any modest victories. Getting a wage increase during ‘austerity’ as well as under the impending threat of the closure of Ealing Hospital is hopefully a signal to other workers that they can get more despite the ‘we’re all being squeezed’ rhetoric from managements. But there were no links made to other workers during the strikes, despite invitations from representatives from the University of London cleaners to speak at their picket. As well as this, a central plank of the union strategy was was based on the financial burden to the company of having to taxi in the scabs and their vastly increased pay: the figure doing the rounds was £18 an hour. This is almost 3 times more than the Medirest workers on strike would normally get. Add on the transport costs to bring from various other parts of London and the meal tickets, times seven days, you get to a pretty large sum. The only trouble is 1) It was unclear whether the scabs were actually getting £18 an hour. The scabs we asked said they weren’t getting paid this much, just their regular wage, which, while is more than the minimum wage (£7-9), is not £18 an hour. But of course, they could be lying. At any rate, there was some uncertainty about this, which meant that relying on the fact that management were taking a big financial hit could not be relied upon as a pressure tactic. 2) Compass is huge and it’s highly likely that even if they were paying £18 an hour for a reduced staff for 7 days, it will not make as much of a dent in their overall finances as we’d like to think. Despite this, their victory, while small and not a full one by any means, shows that amongst this representative composition of the low wages sector, organised efforts can come about and something be clawed back.

Struggles against division between core work-force and outsourced workers

Strike for higher wages of outsourced DHL logistics workers, August 2013
DHL staff that support inbound logistics activity at Jaguar Land Rover’s plants in the UK have voted to strike in a protest at pay disparities between DHL and JLR staff. The action is being taken by warehouse, in-plant and driver staff. DHL has offered staff a pay increase of 6.2% this year while Unite has requested a 12.8% increase for operatives and 20.6 % increase for drivers over the next two years. The company said it had taken on 2,500 additional people across the West Midlands and Merseyside since 2011 in support of the carmaker’s expansion. Since then it said it has also increased average wages by over 15%.

Strike of cleaners, casualised lecturers and lecturers at SOAS university, March 2014
These are interesting struggles because they happen on the same campus and partly involved students. When the police tried to get supporters of the cleaners mobilisation off campus it came to a quite big and unruly ‘cops off the campus’-demonstration. We talked to people involved in organising as casualised lecturers who said that the relation between the national UCU strike and the UCU union reps and them as casualised teaching staff is difficult and due to formal union and labour law structures their protests don’t really come together. The real pay of permanent lecturers has fallen by 13% since 2009 and the strike is against a 1% pay offer by management. We will try to have a longer interview with strike activists in order to understand how these struggles ‘work together’ and where they don’t.

Wincanton/M&S strike against introduction of 2-tier wage scale, 2011
Workers for Wincanton at its Marks & Spencer distribution centre in Swindon went on a 24-hours strike against the introduction of a 2-tier wage scale. The company’s annual pay offer for the workers includes a cut in pay for new starters from £8.00 to £6.45 ph. While the strike itself was not that powerful, the strike issue had much wider implications: in 2011 the so-called Agency Workers Directive was introduced, which gives workers of temp agencies the right to the same payment as their permanent work-mates after 12 weeks of continues employment. Wincanton and other companies reacted by introducing new ‘low-wage’ scales, which would re-establish a wage division amongst the work-force.

Struggles against the pay freeze

There have been various strikes against the pay freeze, mainly in private companies. It would be necessary to have a closer look at these strikes: in what kind of situations do workers feel confident to question the pay freeze imposed broadly since the mid-2000s?

Struggles over working-conditions

In general there are much less strikes over working conditions, most disputes are about redundancies and pay cuts. In the media we can read regularly about the ‘over-stressed’ condition of NHS workers and teachers, but the official disputes are rarely about ‘work intensity’ or under-staffing. We hope that future struggles will take up this question of ‘work-stress’, given that it is an issue for everyone – and is putting into question their drive for further ‘productivity increase’. The likelihood of this being a ‘union issue’ though, is unlikely. Therefore we found the following example very important.

Strike against night-shift imposition, Bombardier, March 2014
This strike is of particular importance given that Bombardier just ‘won’ the £1 billion contract to build trains for London’s Crossrail project. Britain’s only train builder, based in Derby, ‘beat’ Japan’s Hitachi and CAF of Spain to supply 65 trains for the line. Bombardier – the British arm of the Canadian aerospace and transport manufacturer – had warned that missing out on the contract could cause the factory, which employs 1,500 workers, to close. We can see this as a ‘national deal’, which was also meant to black-mail workers into ‘international competition over jobs’. Therefore it is important that in March 2014 production workers at Bombardier began a 14-day strike action over management attempts to force them to work 70% of their shifts at night time. These workers are not at Derby plant, but at the Central Rivers depot near Burton Upon Trent, but it shows that they don’t just accept things, just because ‘state and management’ had an expensive deal.

Struggles against evictions and closures

We have seen various good struggles, e.g. the blockade of an eviction in West-London by activists from Kilburn or the occupation of a mental health day clinic in Cambridge in March 2014. We need a more in depth debate about these struggles and also about their aftermath, e.g. in London some of the ‘occupied’ libraries continued to run on a volunteer basis with support from the local council, which is basically what they want to achieve with their ideology of the Big Society.

Focus E15
In September 2013 it was announced that this temporary accommodation for mothers and their babies will close down and the mother resident were served with eviction notices. They were told that they would be rehoused in private accommodation (e.g. left to the whims of private landlords who could raise rents whenever they liked which might well exceed the benefits cap and thus make these women homeless once more). Moreover, they were only offered such housing in places including Hastings, Manchester, and Birmingham, nothing in Stratford – where most of these women had grown up and where they had friends, family, and support networks. Since then they have been campaigning against their eviction and the right to stay in Stratford. They disrupted and occupied a council meeting at the town hall and hold regular meetings and public stalls and events. Three women who have played a leading role in it have recently been offered housing in East London, obviously as a ploy to keep them quiet and to fragment the campaign. They have rejected this and continue to demand that all residents of the mother and baby unit be provided with social housing in Stratford. They’ve recently widened their efforts to everyone suffering from housing problems. It’s difficult to find good write-ups but a meeting is coming up where we hope to get more information… [4]

5) Situation of the (radical) left in the UK

Turning the anti-austerity struggle into electoral politics

We have to state that most of the ‘anti-austerity struggle’ so far has been closely linked to the (electoral) politics of the Trotzkyite populist left. We say this based on our (limited) experience within ‘Hackney against the Cuts’, during ATOS and Save the NHS protests (Ealing), bedroom tax protests (Tower Hamlets) and ‘Peoples’ Assemblies’. Either the protest gave a platform to Labour politicians, called for ‘putting pressure on Labour councillors’ rather than for direct action or for voting or standing as an candidate for the Trade Union and Socialist Coalition (TUSC). By now we would feel uncomfortable to mobilise work-mates or other working class people to these protests. This is not due to sectarianism, but the belief that the instrumentalisation of these ‘protests’ through the left parties will either put people off or will end in disillusionment of ‘failed’ electoral politics. Things look similar when it comes to initiatives like the national shop-stewards network, which seems now completely in the hands of the SP and reduces itself to ‘attempting to push the TUC to call for a 24-hour general strike’. Comrades in Scotland told us about similar developments when it comes to the ‘Radical Independence Campaign’: the struggle about concrete social issues is replaced by a struggle for a post-independence ‘socialist Scotland’. We want to learn from comrades who take part in genuine efforts (the various ‘coalitions against poverties’, self-organised ATOS protestors, local housing groups etc.) by debating their experiences in a wider context.

Professionalisation vs. Impoverishment

Within the radical milieu in London we observe as strong tendency towards individual professionalisation (academic career, becoming paid ‘organisers’) and individual impoverishment. The income differences within ‘the scene’ increase at a faster pace than in the rest of society. Collective efforts become increasingly difficult (squatting law, lack of resources). We feel a great need to address these tendencies on two levels: a) what is our critique of a ‘profession’ and of ‘movement jobs’; b) how can we discuss and organise jobs and reproduction collectively and politically again. The (autonomist) left addresses this problem of ‘professional precarity’ and ‘fragmented struggles’ by digging out old, well-meaning, but finally individualising concepts like the ‘guaranteed income demand’, which we have to criticise. [5]

(Mis-)Interpreting the threat from the right

Recent mobilisations against EDL marches and debates about the rise of UKIP revealed the problems of ‘anti-fascism’ of the left. By siding with ‘democratic’ state forces (local Labour councillors or ‘community leaders’) against the far-right, the left fails to address the fundamental questions when it comes to understanding the far-right threat: the material question of ‘competition on the labour-market’ (UKIP) and problems of ‘communities’ (EDL) cannot be answered by ‘liberal multiculturalism’ or democratic appeals towards ‘social unity’; facing this type of left-politics even the populist right-wing rank-and-file can present themselves as ‘rebels’ against neoliberalism – while the official party doctrine and leadership is quite clearly neoliberal. A proletarian critique of the notion of the ‘community’ and of the ‘inbuilt fascism’ of the democratic state is as necessary as a critique of ‘national protectionism’ as an answer to competition on the labour market or (language, cultural) fragmentation at work or in the proletarian areas. [6]

Stuck in formalism vs. stuck online

Our anarcho-syndicalist comrades seem to be stuck in a certain formalism. Instead of debating the concrete conditions of the working class and ongoing struggles and basing their organisational proposals against the background of these concrete tendencies, they mainly come up with formal proposals (‘organising workshops’ on how to collectivise ‘grievances procedures’) and further formalisation of their structures (debate about being recognised as an ‘official union’). We see ourselves in the tradition of the ‘lively phase’ of political syndicalism, e.g. the phase of the early IWW when the organisation was able to turn the concrete ‘precarious existence’ (mobile, seasonal, day-labour) of the workers into a weapon of class struggle. We therefore want to engage in open and honest debates about a) what are the conditions and struggles now and b) what can self-organised struggle effectively look like under these conditions. ‘Formalisation’ is a rather helpless answer to the ‘individualisation’ which we face within the milieu: rather than collective theory and practice we see a proliferation of ‘exchange of individual opinions’ online combined with anonymous mass events, where people listen to academic stars.

Conclusion

We would like to end on the following question concerning the working class’s response to the crisis attack: either people are affected ‘individually’ by the cuts (bedroom tax) where the structural basis for collective resistance is too thin (so far campaigns weren’t able to create this ‘collectivity’, the ‘riots’ could be repressed) or workers accept the sectorial boundaries set by state and labour law (NHS, London Underground). They have a collective response, but the material basis has been undermined over the years, so they can easily be singled out as ‘self-interested’. So what exists between this ‘individual situation’ as victims of the cuts and the ‘undermined islands of former strength’? Here we have to look at both (or rather the interplay of) the actual existence of working class mobility (precarious workers, outsourced workers), which might become a bridge between these two poles, and new forms of ‘political class organisation’ (square occupations, inter-professional assemblies), which can help to break existing boundaries. Organisational work has to relate to this gap and the dynamics between ‘proletarian existence’ and ‘productive power’ within the class to develop a strategic response, rather than imagining campaigns or limiting itself to formal networking. For this we need collective structures to organise our survival, inquiry and attack.

Footnotes

[1]
List of benefit cuts in 2014/15
http://www.disabilityrightsuk.org/how-we-can-help/benefits-information/timetable-forthcoming-welfare-benefits-changes

[2]
The National Institute for Economics and Social Research (NIESR) said the new Scottish government would have to borrow that £23bn sum in its first year of independence, at interest rates up to 1.65% higher than the UK Treasury’s rates, in addition to billions more needed to meet its budget shortfall on day-to-day spending; the calculations were based on the Scottish government’s promise after independence to repay its share of the UK’s debt, which is expected to hit £1.7 trillion by 2015-16. There have been more recent attempts, rhetorically at least at this stage, to address the imbalance between London and the rest of the UK by pushing ahead with the next major transport infrastructure project in the pipeline for 2017: the high speed rail link HS2 from London to the north. There is hostility to the idea from people who will be directly affected by the construction project going through their back garden but this will probably not be enough to stop it, being as it is, a way the government can promote growth outside London and to quell overheating house prices in London – or at least fuel house prices outside London/improve business opportunities and investments outside London?

[3]
http://www.dailymail.co.uk/news/article-2534282/Wardens-tackle-disturbance-involving-inmates-Oakwood-prison.html

[4]
http://www.revolutionarycommunist.org/index.php/fight-the-cuts/3254-fe201213

[5]
http://libcom.org/library/aufheben/pamphlets-articles/stop-the-clock-critiques-of-the-new-social-workhouse/reforming-the-welfare-state-in-order-to
We translated an article by wildcat on the question of professionalisation. It will be available online shortly.

[6]
http://www.wildcat-www.de/en/wildcat/95/e_w95_greece.html
https://libcom.org/blog/community-champions-other-crack-report-after-working-caretaker-east-london-housing-estate-2