Monday, 20 December 2010

The Best Western and the BNP- Update

Following my last blog, the Best Western and the BNP, the Best Western Hotel Group has got in touch with the STUC.   

We have now arranged a meeting to discuss this issue in January. We are pleased that the Best Western is taking this issue seriously and wants to engage with us on it. We look forward to having a positive discussion with them when we meet in the New Year.

Tuesday, 14 December 2010

The Best Western and the BNP

It has been brought to our attention that the Best Western Hotel in Leicester allowed its Conference Suite to be used by the British National Party for its annual conference. Apparently they did so in full knowledge that the booking was for use of the BNP and their Holocaust denying leader Nick Griffin.
As a result of this decision trade unions and anti-racist campaigners are considering calling on their members to refrain from using Best Western Hotels.
The STUC will be writing to the Best Western to express our concern and to ask why they allowed their facilitates to be used to promote racist and fascist ideas.  
In the meantime we are asking people to decide for themselves whether in light of these allegations, they want to continue spending their hard earned cash at the Best Western.  
Helen Martin- STUC

Friday, 10 December 2010

The Cap on Migration: How’s that working out for you Mr Cameron?

Immigration, immigration, immigration. It’s always an election issue and last year’s General Election was no exception. Enter Mr Cameron with his shiny new policy designed to rid the UK of its ‘immigration problem’: a cap on migration.
It plays well in the Daily Mail. It seems like a simple approach; just put a limit on it! Looks like he’s on to a winner. Err.... not quite.
There are many problems with the cap on migration. Firstly the majority of immigration to the UK comes from within the European Union and therefore can’t be limited. The UK signed up to a treaty when it joined European Union that agrees to freedom of movement within Europe. So if British people want their holiday homes in Spain or their Châteaux in France they have to accept that EU citizens can come and live here too. Without a complete withdrawal from the EU (which admittedly many Tories would favour) there is simply no way David Cameron can limit the largest single source of immigration to the UK.  
But this doesn’t seem to have deterred Mr Cameron. Instead he is pushing on with his pledge to reduce net migration from the hundreds of thousands to tens of thousands. He has already begun by looking at Tier 1 and Tier 2 migration. This means he is looking at limiting highly skilled workers and workers who come to fill jobs in shortage industries.   
Which leads us to the second problem. No one (except Daily Mail readers) actually wants to limit high skilled and shortage industry workers, because their contribution to the economy is very valuable. And from reading the number of exceptions to the cap in migration in the Government’s policy (for example they have excluded all intra-company transfers, which currently make up a large proportion of Tier 2 migration) it’s not clear that the Tory Government really even want it.  
This is one of the few truly uniting issues. I was a meeting about this Cap on Migration a few months back hosted by the Scottish Government and not one single organisation around the table thought the Cap was a good idea. This meeting included, among others, the Scottish Government, Local Government, the CBI, the federation of small businesses, the NHS, the oil industry and of course the trade unions. It is difficult to get us all to agree so wholeheartedly on anything but Mr Cameron has managed it.
Despite almost united opposition against this policy the Government are continuing on and will be limiting foreign students to Universities and Colleges and family reunifications next. These areas, of course, come with their own moral and economic problems. Not least of which is the amount of funding that Universities and Colleges receive from foreign students, which must be valuable as the Government seems to think there is a funding crisis in higher education, hence the introduction of £9000 a year tuition fees.
The final problem with the cap in migration is that it may not even work.  Mr Cameron is interested in net migration which is the total number of immigrants entering the UK minus the total number of emigrants leaving the UK. We have already seen the difficulties he has limiting immigration but he has absolutely no control over emigration. The levels emigration is primarily affected by the amount of British citizens who leave to go and live abroad. So if lots of British people decide tomorrow to up and leave and seek work in Australia (or anywhere else) Mr Cameron could reach his target on reducing net migration without lowering the numbers of immigrants entering Britain at all.
But equally if British people decide they don’t fancy leaving this year, for whatever reason, then net migration will rise. Interestingly this is actually what has happened.
After the Tories came to power they introduced a temporary cap on migration primarily to stop lots of people coming to this country before the real cap was in place. Despite the temporary cap on Tier 1 and Tier 2 migration, net migration has risen from 196,000 to 215,000 people. This is primarily because of a decrease in emigration not an increase in immigration.
It does make you wonder though. What is the point of this expensive, difficult to run and economically costly cap on migration? It doesn’t even work!

Helen Martin - STUC

Thursday, 9 December 2010

Get out! The Roof is falling in! The UK is the next Greece after all!!

Evidence? Check the graph below which shows the rise in benchmark UK 10 year gilt yields over the month to 8 December – remember, higher bond yields increase the cost of financing the government’s new borrowing and of refinancing its maturing debt.

An 18% increase over the month is hardly insignificant. Therefore, it is somewhat strange that we haven’t been hearing about this in the press. Can you imagine how an 18% monthly increase would have been reported prior to the election?! It would have been taken as proof that the UK had joined peripheral eurozone nations in genuine crisis mode.

However, this blog’s headline is deliberately ironic; the story is always more complex and the UK is not the only major economy to have seen its yields rise over the past month. Indeed, others have seen bigger rises:   US up by 28% to 3.274; Germany up by 27% to 3.032 and japan up by 29% to 1.234.

What do we conclude from all this? Does the rise in yields signal imminent fiscal crisis? Does the lower rise in the UK relative to other major economies indicate that the Government is right to pursue its austerity plans?

As usual, the data can be - and is - used to support a number of different and contradictory positions. And it would be silly to read the apparently coordinated rises across major economies as indicative of a coherent global narrative. German yields have risen as worries have grown over its potential exposure to eurozone bailouts. Rising US and UK yields are probably due to a number of factors: investors, who traditionally lower risk at this time of year are also concluding that gilts were overpriced compared to stocks (stocks have risen as gilt yields have fallen); some data (particularly manufacturing surveys) indicating that the recovery might be growing in strength (note: growing in strength does not = strong) - a stronger recovery might encourage central banks to consider interest rate rises earlier than anticipated; there are undoubtedly some concerns in the US about the long-term fiscal position which has just been worsened by the decision to extend the Bush tax cuts.  Next month the yield may move up or down for an entirely different set of reasons. Of course, the STUC continues to believe that the medium term threat to stable public finances will come from the low revenues and high costs associated with a prolonged period of low growth and high unemployment. We shall see.

In these times of great uncertainty, it would be overly ambitious to draw definitive conclusions from one month’s rise in bond yields and it is important to remember that yields remain low by historical standards and in comparison to genuine crisis countries: Greek yields are pushing 12% and Irish are at 8%.


The point of this blog is to highlight how short-term shifts in gilt prices can be used to mislead. The proposition that the UK fiscal position has deteriorated significantly over the last month can suddenly appear plausible when a graph showing rising gilt yields is produced in evidence – all the more so when historical and international comparisons are omitted.

Few people have the time, inclination and wherewithal to interrogate the validity of such arguments. Indeed, a substantial proportion will assume that this technical, and to most people obscure, information must be sufficient to support the argument. ConDem tactics have relied heavily on the public being generally ignorant and/or disinterested in issues which they find complex and boring. Sticking to the simple narrative which usually involves comparing the national economy to an over-indebted household has served them well; it may be nonsense in economic terms but the majority of people appear to find it plausible.

I guess the lessons are:

  • Get informed – read up on the public finances especially the financing of Government debt – the There is a
    Better Way
    website can provide a start but there is loads of other stuff on the web;
  • Be very suspicious of grand narratives built on short-term market fluctuations; and,
  • Be appropriately cynical when politicians and commentators support their arguments with a narrow range of data.

Stephen Boyd

On the rank hypocrisy of US deficit hawks

From the New York Times:

“Senator Jim DeMint, Republican of South Carolina, said that he still wanted the Bush-era rates extended permanently and that the cost of the package was worrisome”.

Thank you Mr DeMint for exposing in a nutshell the hypocrisy of US deficit hawks (and let's face it, the majority of deficit hawks the world over - it's just that our American cousins are slightly less bashful about advertising their hypocrisy). Their position can be summed up thus:

  • the deficit is the biggest single issue facing the economy and reducing it has to be the Government’s first priority; and,
  • tax cuts which 1) will provide only a small and hugely inefficient stimulus to a depressed economy suffering high and persistent unemployment; 2) significantly worsen the long-term fiscal outlook; and 3) benefit the richest in society….must be retained at all costs.
Reconcile that if you can.

(The above quote was pulled from the brilliant James Kwak ‘s latest post at Baseline Scenario in which he unpicks the Obama tax deal as does Krugman here and here. Brad DeLong is angry. And so he should be).

Stephen Boyd - STUC

Wednesday, 8 December 2010

Will Tuition Fees Kill the Lib Dems?

Tomorrow sees the vote in Westminster on tuition fees and all indications suggest that it will be tight. For the Government it’s being described as their first big test but for the Lib Dems as a party it means a lot more than that.

Over the last few weeks we have seen the Lib Dems come under heavy fire from student groups who rightly feel betrayed.  It’s not surprising how angry students and young people are about this. The Lib Dems did after all make a complete about-turn on tuition fees almost as soon as they got their feet under their ministerial desks.
Many in the Lib Dems do feel uncomfortable about their party’s sudden change in position. Some big hitters, like Sir Menzies Campbell and Charles Kennedy, have already expressed their intention to vote against this policy and others are still deciding where they stand. It will be interesting to see how many Lib Dems keep their own pledge to students and vote against the rise in tuition fees in the vote tomorrow.
We already know that all Lib Dem ministers have now agreed to vote for the changes. Although there was a ridiculous wobble by Vince Cable earlier in the month when he had hoped to be the minister responsible for the Bill and abstain in the vote! (sorry Vince Government doesn’t work like that).
But there are also many Lib Dems who are private secretaries and junior minister who still have to decide how to vote. It will be interesting to see how many of these people, who have something to loose, will rebel against the Government.
The Lib Dems (in recent times anyway) are rarely a party of Government, so they rarely have to prove that they have the courage of their convictions.  This is the first time for a generation that they have been put to the test, and in my view they have been found wanting. Even if the Government looses the vote tomorrow, the damage for the Lib Dems is done and it will, most likely, be lasting.  
Their actions on this issue may have created a generation of young people who will never vote Lib Dem again.
Helen Martin- STUC

Tuesday, 7 December 2010

Osborne’s Cuts will hit women hard

The TUC published research today looking at the effect of spending cuts on women and unfortunately it does not make for pleasant reading.  

Jobs cuts in the public sector are likely to disproportionately affect women. The reasons for this are twofold.  Firstly, the public sector employs a high proportion of female workers: 65% of public sector workers are female. This suggests that women are likely to bear the brunt of the job losses in the public sector across the UK in the next four years.   Secondly cuts in public spending are also likely to have a negative effect on equal pay. The gender pay gap is currently smaller in the public sector which means that even if women do manage to find work in the private sector, they are likely to face a reduction in their wages. The TUC has estimated that on average women in the public sector earn almost 40 per cent more per hour than female employees in than the private sector. 

Public sector job losses will also particularly affect women who work part-time, as the average pay for part-time jobs in the private sector is just £6.78 an hour compared to £9.34 in the public sector. The public sector also has a much better track record of providing flexible employment opportunities for women, which enables them to combine childcare responsibilities with work.

Job losses in the public sector will hit women hard and will have an effect on household incomes across Scotland. This will have a particularly devastating effect on households where one partner has already been made redundant or has already taken a pay cut. These cuts are likely to put families who are already struggling in an even more difficult position. 

But the effects of Osborne’s spending decisions do not stop at job losses in the public sector. The reductions he is making in benefits will also hurt women. Lone parents, 90% of whom are female, will be hit the hardest losing 18.5% of their net household incomes, and female pensioners will see 11.7% of their income lost.  The House of Commons Library carried out an audit of the emergency budget which Osborne set in June and found that 72% of the changes in tax, including tax credits and benefits hurt women.

It’s difficult to come to terms with the fact that despite all the economic problems we have already gone through, there are still difficult days ahead. It is also difficult to understand the Government’s logic when they make these sorts of cuts. This Government has chosen to make it more difficult for women, particularly lone parents and women who are working part-time, to support their families. The knock on effect on child poverty of these cuts will be severe and may even undo the good work that we have seen on this issue in the last 10 years. 

Plunging families into poverty has serious consequences and we already know from past experience that the effects of these sorts of choices can last a generation.  

Helen Martin - STUC

Friday, 3 December 2010

On the strange story of German and US unemployment

When the banking crisis was at its peak in autumn 2008, the Scottish Government responded by organising a series of 'economic quadrilaterals' involving the Scottish Government, Scotland Office, CBI and our good selves. The third such meeting was held here at the STUC in September 2009.

I raised the issue of the stark differences in the way national labour markets had responded to the precipitous fall in output. Summarising very crudely,
  • the US had seen a massive rise in unemployment but one roughly consistent with what could be expected given the fall in output and (inadequate) stimulus measures;
  • Germany, despite having suffered one of the worst falls in output among the developed nations (what you would expect given its reliance on exports and the huge fall in world trade in late 08/early 09), had managed to maintain employment levels - unemployment hardly moved; and,
  • Scotland (and the UK) was somewhere in between - unemployment had not risen to levels consistent with the fall in output.
The response from our friends in Scotland's foremost employer body was to argue that given the flexibility of the US labour market, it was to be expected that unemployment would surge. However, that same flexibility would ensure that unemployment would quickly plummet when growth resumed. The reverse was true for Germany: its more regulated labour market ensured a higher degree of 'stickiness'; unemployment would rise more slowly but would remain higher for longer. As is the way with the employer chaps, this view of the world was asserted, not argued.

Well, what is the situation 15 months on? Given growth resumed more than a year ago, surely US unemployment is plummeting? Surely the 'sticky' German labour market has experienced creeping unemployment that will prove difficult to tackle given the barriers to hiring and firing?

Not a bit of it. The latest US employment stats released today confirm unemployment rising to 9.8% in November ( a number of prominent commentators estimate real unemployment to be much higher but let's leave that aside for now); the 19th month in a row that unemployment has been over 9%.

On Tuesday the latest German figures were published showing unemployment falling for the 17th month in a row to an 18 year low of 6.7%.

What does this tell us? Well the STUC is big enough to acknowledge that this is not a clean experiment and that many other factors other than labour flexibility/regulation are at play. (Please note that this is something the employer bodies never do - they like the simple narrative. And they simplistically and relentlessly promote the virtues of labour market flexibility. They even managed to consistently overlook the small matter of unification when assessing the performance of the German labour market).

I would draw the following broad lessons:
  • demand management works - despite Merkel's public commitment to austerity at home and abroad the German government's fiscal interventions were proportionately greater than the US's;
  • active labour market interventions work - through keeping people in jobs, retraining for the upturn and keeping unemployment lower than it would otherwise be;
  • the US is in a horrible mess and, given the political situation, there really is a chance that things will get much, much worse; and,
  • it really is time to get over the infatuation with flexible labour markets.
Stephen Boyd - STUC

Thursday, 2 December 2010

What the UK Border Agency did next

I have just received this email from Positive Action in Housing. I thought it was important to let as many people as possible know about what was happening in Glasgow with regards to the UK Border Agency and the removal of the housing contract for asylum seeking families. For more information on this issue please see my earlier blog: what the UK Border Agency did.

Please also consider writing to the people listed below.

Helen Martin

Positive Action in Housing is disappointed to have to inform supporters that, despite the Immigration minister Damien Green promising that no one would be moved out of their homes in less than 14 days, the UK Borders Agency (UKBA) has begun issuing 24 hour eviction notices to families seeking asylum in Glasgow.  

34 year old single mother, Namir Rad was told to leave her Glasgow City Council accommodation to move into YMCA/YPeople accommodation as result of the controversial changes in UKBA housing contracts in Glasgow. Namir has twin sons who are about to start at the local high school in the New Year.  She has lived in her flat in Maryhill for over two years and the news that she has to move has hit her hard.  Already suffering from anxiety and stress, she is on sleeping tablets and anti-depressants. She was only told in a telephone call on Wednesday 1 December that she is expected to move today Thursday at 11am. When the Unity Centre contacted Ypeople / YMCA, they were told that Namir would have to sign a letter saying she is refusing to move.  Namir and her family do not want to move from the community where she has been settled for so long.That a vulnerable single mother of two young children should be treated in such a way is heartless and cruel.  

In a separate case taken up by Positive Action in Housing, a single father has been told to move out of Glasgow City council accommodation within 24 hours to Angel Group accommodation.  We have grave concerns about the health and safety of vulnerable families and individuals being moved out at short notice and the use of private accommodation providers.

Despite the assurances given in the media, the UKBA are carrying on regardless with their inhumane tactics. The longer things are left, the more they will single out vulnerable families to move out at extremely short notice, despite the assurances given by the Immigration minister and Phil Taylor, UKBA.

We call for the actions of the UKBA to be investigated by the Scottish Affairs Select committee; the UKBA's behaviour is nothing less than contemptuous. We are dealing with very vulnerable people who have suffered years of mistreatment at the hands of the UK Borders Agency. Many have developed mental health problems as a result of this mistreatment. The UK borders Agency seems to have learnt nothing from the triple suicide of the Russian family in Glasgow's Red Road flats in March 2010 after receiving similar letters to quit by the UKBA. There has also been a spate of children being taken into care after single mothers found it hard to cope with the constant fear of destitution, detention or deportation. There are 600 refugee families in this city who face similar harsh, insensitive treatment. We say no to the UKBA’s inhumanity on Scottish soil.

We believe that Glasgow City Council is the best housing and support service for the refugee families. However, if the contract is not going to be reinstated with the Council, then we believe that Glasgow’s registered social Landlords are a safer, more reliable and better regulated alternative to private accommodation providers currently contracted to the UKBA.

Please email the following - in your own words - and demand that Namir Rad and her sons, should be allowed to stay, demand an investigation and assurances that no more 24 hour eviction letters will be sent out to the remaining 600 refugee families. Please copy your letters to and send in messages of support too.

Please write to:

·         Iain Davidson, Chair, Scottish Affairs Select Committee (they are investigating the UKBA’s actions):
·         David Mundell MP, Scotland Secretary (he can highlight concerns expressed regarding UKBA actions in Scotland to the Westminster Government):  
·         Tam Baillie, Scottish Children’s Commissioner (Children are at risk because of these inhumane actions):
·         Your MSP, MP and MEP. To find out who your rep is, enter your postcode in .

·         Damien green, UK Immigration Minister (he promised no one would be moved in less than 14 days):;
·         Phil Taylor, Head - UKBA Scotland (he told the press no one would be moved in less than 14 days yet it is his department that is moving people):
·         Theresa May, Home Secretary (she can ultimately decide how the UKBA act in this case):  

·         David Crawford, Head of Social Work, GCC (he’s negotiating on behalf of the council with the UKBA):
·         Cllr Gordon Matheson, Leader of the Council,
·         Cllr Matt Kerr,
·         Cllr Danny Alderslowe -
·         First Minister Alex Salmond,;

Urgent Appeal for funds for Positive Action in Housing
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