Friday, 17 October 2014

Decent Work, Dignified Lives: Grahame Smith's conference speech

A warm welcome to today's conference.

I am delighted that you are here today, over 200 people from Scotlands trade unions, voluntary sector organisations, NGOs, faith organisations, from academia and from government and other political institutions.

Todays conference is, of course, being held at a remarkable time in Scotlands history; less than a month since the referendum.

While we are still trying to assess the short, medium and longer term implications of the referendum for all of us and the organisations we represent, the one thing that can be said with complete certainty is that the referendum was a triumph for democracy, and something of which the country can be proud.

The phenomenal turnout on the day came on the back of months of discussion and debate in workplaces, in communities and within families.

There was a thirst for information and engagement the like of which I have not previously witnessed.

And I am immensely proud of the role the STUC and the trade union movement in Scotland played through our ‘A Just Scotland’ initiative in responding to that demand.

The long and largely - civilised campaign resulted in a startling reinvigoration of Scottish politics.

The priority now is to ensure that a political culture, in the process of being radically transformed, starts to spawn new and effective policy solutions to Scotlands deeply embedded economic and social problems.

So the purpose of todays conference is:

To provide a space where new and effective policy interventions to tackle inequality can start to be debated and developed;

To enhance our thinking about what package of new powers might best increase the capacity of the Scottish parliament and government to deliver better outcomes for our economy and society; and to

To be constructively provocative!

The referendum debate was an enriching, empowering experience for the country as a whole, but frankly speaking - too much ‘debate(if i can call it that) during the campaign was either side playing to its own echo chamber.

Todays conference has been expressly designed to challenge preconceptions and stimulate original thought.

The excellent programme of speakers in the plenary sessions, in the workshops and in the closing panel session, was not designed to flatter the prejudices of the audience!

This will become clear throughout the day. I expect this approach to both provoke robust debate and lead to better outcomes.

Economic context

The economic context in which we are having this debate remains challenging to say the least.

Scotlands recovery from the financial crisis, the 2008/09 recession and the prolonged period of stagnation which followed, continues to be tortuously slow.

Although headline growth and employment figures suggest the recovery has gained momentum many of you here today will be aware of the reality which lies behind often misleading headline statistics:

The unprecedented collapse of real wages since 2009;

The stubbornly high levels of youth unemployment;

The historically high levels of underemployment;

The failure of full-time jobs to grow with the recovery of headline employment;

The rise of low wage, low hours 'forced' self-employment; and

The increasingly widespread use of zero hour and other forms of insecure employment contracts.

Scotland might be generating new jobs but many are low quality too many Scottish citizens, in and out of work, are not sharing in the recovery.

This is hardly surprising when the UK coalition government embarked on a programme of austerity manifestly designed to undermine the living standards and security of a substantial proportion of the population including societys most vulnerable.

In the face of a government aggressively asserting the opposite, the STUC argued in 2010 that austerity was avoidable, unnecessary and regressive and so it has turned out.

The bedroom tax, real terms cuts in benefits and wages, deep job cuts for those providing the essential public services on which the poorest rely mosti could go on.

And isnt it revealing that the FT reported only yesterday that UK tax revenues particularly from income tax - are coming in way below OBR forecast. The new model the coalition is trying so hard to embed is simply unsustainable.

If a better and fairer Scotland is to emerge at the end of the process of constitutional change that is currently focusing on enhanced devolution, a new model of economic and social development will have to evolve and quickly.

Whilst macroeconomic issues such as currency and fiscal sustainability dominated the referendum campaign, it was surprising how little economic development issues featured - dominant orthodoxy was generally not challenged by either side of the debate.

The Scottish government’s lengthy papers on re-industrialisation and economic policy choices are helpful as far as they go.

But nothing like a distinct model of Scottish economic development ever looked like emerging from the referendum debate.

In that context I'm very much looking forward to Professor Williams' presentation this morning that will point the way towards a new foundational economyapproach for Scotland. 

Policy solutions such as basic income, hitherto regarded as too radical or controversial, must be properly assessed; which Frances Coppola’s contribution this afternoon will undoubtedly help us do.

Despite the best efforts of the STUC and others in this room, some of the factors which exert a profound influence on the shape and nature of Scotlands development were almost completely absent from the referendum debate or covered in ways that were hardly serious.

These include:

How currently deeply ingrained asymmetries of economic power might be rebalanced through extending collective bargaining underpinned by enhanced trade union rights;

what is the purpose of tax and what quantities of revenue must be generated to support a better and fairer society?

And how should the financial sector be structured and regulated?

We were constantly told that tackling inequality was a priority but the policies discussed during the campaign fell far short of a serious, coherent policy programme.

The policy interventions required to tackle inequality are many and varied

But let us be under no illusion that a central plank of any strategy to tackle inequality is the presence in the workplace of strong, and effective free trade unions.

It is no coincidence that the decline in real wages as a share of our national income, the growth in zero hour contacts and forced self employment and other forms of insecure work have  occurred at the same time as unions have been under attack  politically  and industrially.

And the power imbalance we see in our economy will not be reversed until the legitimate role of unions in the workplace and in wider society is recognised and an environment exists where unions can function effectively and responsibly in the interests of working people, their families, and wider society.

The Working Together review

Earlier this year, at the suggestion of the STUC, the Scottish government established the working together review chaired by Jim Mather.

This review is potentially the most important piece of work I've been involved in in my near 30 years at the STUC and 35 years as an active trade unionist.

It is a piece of work that stands in sharp contrast to the Carr review which was launched by the UK government in the wake of the Ineos dispute to prepare the ground for legislation limiting the right to strike in key utilities and public services depending on the outcome of the 2015 UK general election.

In August, in the week that the Carr review bit the dust because neither unions nor employers provided it with evidence and Ministers undermined it by making statements prejudging its outcome, the report of the Working Together review was published in Scotland.

The report gets behind the headlines and shines a light on what unions do at a strategic level with government; the role we play as part of civil society; what we contribute at a sectoral level; and of course the impact we have in the workplace through our workplace reps.

I would encourage you to read the report and its recommendations.

I believe that if implemented the recommendations have the potential to completely change the culture of industrial relations in Scotland, to the benefit of workers, their companies and organisations, and the Scottish economy.

Enhanced devolution

The recommendations of the working together review were set in the context of our existing devolved constitutional settlement.

Following the referendum that debate has moved on, perhaps more rapidly than many of us anticipated.

Earlier this year the STUC published proposals for enhanced devolution. 

These included:

the devolution of income tax including the ability to vary all rates and bands;

more extensive borrowing powers;

the devolution of employment services and active labour market policy;

the devolution of health and safety regulation and of employment tribunals; and

increased flexibility over immigration policy.

As part of our proposals we also made the case for radical reform of local taxation.

Of course, we published our views on enhanced devolution in March, six months before the referendum.

A lot of water has passed under the bridge since then and it would be odd if we did not recognise and respond to the changed and changing political context post the referendum.          

Constitutional change is about powers but it is also about purpose.

For us and for a vast number of those who voted yes and no, that purpose is a fairer more socially just Scotland.

To date, the focus on enhanced devolution has been on fiscal and welfare powers. However, important levers are also those over wages and the labour market.

In formulating our response to the Smith Commission we are looking again at the case for the devolution of powers over employment and trade union law, including union recognition and collective bargaining and other forms of workplace democracyenabling interventions in the labour market and the creation of jobs to be matched to positive employment practice and action on wages. 

Helping shape the passion and enthusiasm which has manifested itself during and post the referendum into policy prescriptions which are relevant to Scotlands circumstances is a significant challenge.

It is important to be as ambitious as possible for the people whove suffered most over recent years. 

And its essential that the environmental challenge isnt relegated to an afterthought.

But the constraints imposed by being an open economy on the periphery of Europe cant be ignored.  

Policies must be radical but effective; progressive but coherent. A new approach must continue to engage those whove stood outside the political process for too long.

The STUC looks forward to working with the range of organisations represented in this room to make sure this happens and to take forward the thought and discussion that will take place at today's conference.

Thank you for coming today and I look forward to an interesting, challenging, provocative and ultimately productive day.  

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