Bedroom tax – a battle which should unite not divide

Every issue at the moment, it would seem, warrants the corralling of party political wagons and represents an opportunity to win a tactical advantage in the constitutional debate.

Labour and the SNP, and their various supporters, are currently going at it hammer and tongs over the bedroom tax.  For the uninitiated, the ConDem UK Government came up with this cunning wheeze as part of its welfare reform package.  Housing benefit as we know it is going and will be subsumed into the new universal credit.  Moreover, from April, anyone who has more bedrooms than the UK Government deems appropriate will no longer qualify for help with housing costs.

Thus, foster carers, kinship carers, families with a disabled child or adult, parents who share the care of their children or who need an extra room so they can enjoy overnight contact will all be affected, if they live in local authority or housing association properties and do not have sufficient income to meet their rent.  This is social engineering on the grandest of scales and all to shave the welfare bill at its margins in the name of austerity.

Both Labour and the SNP have had good and powerful things to say on this issue.  Labour did the job demanded of an effective opposition at Westminster and rallied its troops around this one, right from its first appearance in the welfare reform agenda.  And once it reached our borders in terms of implementation, the Scottish Government has laudably drawn attention to it, with help from a range of SNP supporters.  Backbench SNP MSP, Linda Fabiani, one of the most knowledgeable and authoritative members at Holyrood on a slew of issues these days, was quite brilliant on last week’s Sunday Politics Show, emphasising how offensive this policy was, not least because of its failure to acknowledge that a house is also a home.  And Andrew Wilson in today’s Scotland on Sunday, rightly points out that all Scottish MPs but the lone Tory and the clutch of Lib Dems – Mike Crockart as the only honourable exception – opposed this measure.  Both he and Mike Dailly have likened the bedroom tax to the poll tax – a powerful analogy.

But last week in Holyrood’s chamber, our two main Scottish political parties were back to their default positions, squabbling over how Scotland should respond.  Rhoda Grant, the Highlands Labour MSP, decided that if the Scottish Government would just build lots of one bedroom houses, we could fix the problem, conveniently forgetting that under her party’s watch, the Scottish Executive between 2003 and 2007 managed to fund the building of just six local authority houses in total, across all of Scotland – when money did seem to grow on trees.  Which encouraged Mark McDonald MSP of the SNP group to have a pop.  None of it is dignified and not a single word is contributing to finding a way to mitigate against this pernicious policy which will cause appalling financial worry and emotional stress for many and homelessness for some.

When there is an obvious policy battle around which to unite, why do Labour and the SNP prefer to divide?  Surely, the tens of thousands of families about to be hit by the bedroom tax – some of them among the most vulnerable in the country – deserve better?  Don’t we all deserve a political class prepared to leave difference at the door and get round the table to find the solutions when the need demands it?

And enough of the constitutional options being the solution.  Families cannot afford to wait for the outcome of the vote in 2014. To suggest that either a yes vote and independence will allow Scots to reverse such a move and make our own fiscal decisions on benefits or that a no vote will allow for the devolution of welfare policy amounts to a dereliction of duty by both sides.  We might not be able to make this policy disappear with the powers we currently have in Scotland, but we can act to mitigate against its worst effects.  If only our political parties are willing to lay down their cudgels and focus on the here and now and on what can be done, rather than what might be possible one day.

Mike Dailly and the Govan Law Centre have already suggested one way of doing so, urging the Scottish Parliament to relax eviction law so that anyone who accumulates rent arrears as a result of the bedroom tax is not evicted from their home.  That would be a start.

We can and should build more houses, of mixed size and type.  Rhoda Grant was partly right – if we had more one bed properties available, then more people all round would be able to access social housing.  There are far too many families on waiting lists because they need two or three bedroom properties, but others with higher needs get them because they are the only properties available.  Moreover, many pensioners want to downsize but cannot because there is nowhere for them to go.  Where local authorities have one bed properties available and put in place incentive schemes to support people to move – offering rent free periods, free decoration, moving and house clearing – it tends to work in creating a more mobile population.  Not by forcing people to downsize but by creating choice.

So, change eviction law, build more houses, create more incentives enabling more people to move to smaller housing.  All would help, and so would cutting rents.

Last year, 15 of the 26 local authorities in Scotland with social housing stock opted to increase rents at or above 4.4%.  For years, high rent rises have been justified by some because at least 60% of rents are met fully or partly through housing benefit.  The implication is that the Treasury pays the increase not the tenant but that, of course, will no longer apply.  So what local authorities and indeed, housing associations must do is stop applying eye-watering annual rent increases.  Moreover, they must have the power to apply differential rent increases so that anyone who will be hit by the bedroom tax can pay less or no rent.  If they do not have the powers currently to do so, then Holyrood can and must act.  It does after all have complete control over housing policy.

Social landlords might squawk about the need to raise rents to invest in repairs and maintenance, but needs must.  Ask their tenants and most of them would rather have a roof over their heads than an uptodate kitchen.  In any event, there is nothing to stop the Scottish Government nor local authorities from investing capital allocation in housing refurbishment and repairs as well as in construction.

Moreover, Holyrood must also look at what it can do under social work powers to create new provisions for emergency maintenance payments for families affected by the bedroom tax which do not then impinge on their entitlement to other UK benefits.  How might a pot be created for this?  Well, how about a revaluation and reform of council tax to create more bands at the top of the property ladder, so that those who can make more of a contribution, do?

None of these solutions are simple:  some would take a bit of effort to make them work but nor do they have to be unnecessarily complex.  And they should not be dismissed as impossible.  Anything is possible if the political will and maturity exists, not least to unite to face down this threat.  Acting to mitigate against the impact of this policy shouldn’t prevent our politicians from protesting vociferously but that protest would be more effective if it was voiced in unison.  Yes, we need more powers to make our own decisions on welfare.  But in the meantime, let’s acknowledge that we are not entirely powerless.

We have some powers:  let’s use them.

EIS empty vessels making a lot of noise

It probably made Mike Russell’s day.  For years, the Education Secretary has been trying to perfect a look that can best be described as a school-teacher’s one.  One that fixes the recipient with a steely gaze and shows that he means business.  It would appear he has finally managed it, if the EIS President Alan Munro, is to be believed, transmuting this gaze onto paper.   Apparently, his offer of help to schools struggling to implement the Curriculum for Excellence came with a “sinister threatening tone“.

Without actually explaining what he means by that, of course.  Still, made for a nice headline and possibly a satisfied smile from the Cabinet Secretary.

Next up at the EIS conference was the new General Secretary, Lanny Flanagan who tried to match his President in the hyperbole stakes when he warned the Education Secretary and the Scottish Government that it “cannot hide behind the coat-tails of some Eton toffs“ on pension reform for teachers.

The General Secretary was good enough to acknowledge that it is the UK Government which, in the name of austerity, intends to make people in the public sector work longer and pay more towards their pensions.  “We know who the guilty are in this great cash robbery“, he said but also suggested that teachers will expect the Scottish Government to stand up for them and “if they fail to deliver a fair settlement on pensions here in Scotland, we are prepared to fight them every bit as hard as we will fight the UK Government on this issue“.

Just what Scottish education needs:  a street-walking, talking, fighting man, prepared to draw the battle lines, and pronounce in tones far more sinister and threatening than anything Mike Russell is alleged to have uttered or written.  What Flanagan is saying if we lose the battle with the UK Government – and they will – we expect the Scottish Government to make up the shortfall in the pensions settlement.  Which sounds awfy like a case for local bargaining, something else the ConDem government wants to push through and the unions supposedly are against.  Shame no one told Larry Flanagan the script.

But if the Scottish Government was to make good the pensions settlement, something would have to give.  Either it uses revenue from the new taxes which will be in place by the time these pension reforms go through, or it cuts from existing expenditure.  Neither is palatable.

Especially if the shortfall is made up from existing education expenditure. Will students and parents applaud the Scottish Government refusing to hide behind Eton toffs’ coat-tails?  Will they agree with the priority that sees more going into teachers’ pockets and purses and less directly into children’s learning?  Less to spend on classroom resources, on equipment, on learning support is what it means. Would such a move improve teachers’ morale and productivity, therefore improving outcomes for children and young people?  Which is what the EIS is always telling us by the way, that if we just valued teachers a little more, the rest would take care of itself.

I’m not sure parents and families – who have just as many votes to spare in elections as teachers do – would buy it, any of it.  Especially when we have years of austerity living ahead of us.

For all the high-blown rhetoric of the EIS leadership, the delegates weren’t buying it either.  There was a welcome outbreak of common-sense when members voted against precipitate strike action on the timetable for introducing exams linked to the Curriculum for Excellence.  As one delegate pointed out, the union had only agreed a deal with the Scottish Government a few months ago on support measures – the sinister threatening thing – for schools struggling to meet the timetable.  Teachers needed to keep to their side of the bargain, was the argument, and see if the promised support makes any difference before throwing their toys out of the pram.

Members agreed.  Which might be something Mr Munro wants to reflect on.

Just as Mr Flanagan might wish to reflect that there are more ways to make your mark as the new boy in post than grabbing headlines.  There is no doubt that Ronnie Smith is a hard act to follow.  He had his moments over the years when he led his membership to the barricades, but he also knew which battles to pick.

Pensions worry everyone, but they are a whole lot more troublesome to them that haven’t got one. While the unions clearly have a case against the UK government’s vandalism, it’s less clear that the public at large would agree to go without so teachers can have more.  If offered the chance to reverse some of the austerity measures being imposed by the Eton toffs, I doubt if public sector pension changes would be in the top five.  And even fewer would opt for the Scottish Government making up the shortfall, not when other services would have to be cut to enable it.

If Larry Flanagan thinks this is the fight to take to the Scottish Government, he’s wrong.  It is a union leaders’ job to promote his members’ interests but not when they have become so vested that they are pitted against those interests they are there to serve – the public’s.  Producer interests have no more rights in this austerity morass than we do and at some point, public sector workers have to realise we really are all in this together.  It’s us – all of us – against them.

The Education Secretary might occasionally feel that everything is a fight right now.  Getting anything done means battling against all the interests set fast against change, be it good or bad.

But these empty vessel speeches and the response of the membership indicate the creation of a gap, between rhetoric and reality.  And give hints as to who might win out.  As well as practising the sinister and threatening tones, Mike Russell might also want to start rehearsing his maniacal laugh.

 

Guestpost: A bee in our bonnet about Beecroft (1)

This anonymous guest post delivers a devastating critique of the Beecroft report, from the viewpoint of a trade unionist who is a Unite workplace representative.  The guest’s views are their own and not that of the union they are a member of.  Our guest is also keen to point out that they are not a legal expert and notes that “it would appear from the report, neither is Beecroft.”

There is nothing of merit in this report and much that will damage employees, and eventually employee/employer relations. Beecroft contains many red line issues for the Labour/Trade Union movement, largely as the result of the dismantling of hard won rights and the disproportionate effect it will have on low income workers and women.

The first myth to dispel is the idea of a causal link between lax labour market regulation and growth, which Beecroft implies, given that the UK has the third worst employment protection in the OECD below the US and Canada and still has sluggish growth at best.

Len McCluskey has already signalled that unions would consider illegal forms of protest and civil disobedience to protect employment rights. This was couched largely around the changes to tribunals and ballots for industrial action. I would assume Len’s position still applies: Prospect recently voted on a motion at their conference attacking Beecroft and the proposed employment tribunal changes.

I anticipate further votes and motions as other unions meet over the summer, a strategy to be developed by each union with the STUC and TUC. I also think that the attack on employment rights will loom large in the planned mobilisation on October 20^th.

It remains to be seen how far Len McCluskey can take his members along the road of protecting employment rights. For such a campaign to work, it needs to appeal beyond the committed core of activists, shop stewards and representatives. However, there is hope: the “68 is too late” campaign appears to be gaining traction with the general public.

How we might have laughed (or maybe not) at the David Cameron/Life on Mars posters before the 2010 UK general election, but the changes to employment law proposed pull us back to the 1970s. It seems nonsensical that reducing employment protection, encouraging poor management and making people feel less secure at work are ways to generate growth.  In fact, it will probably restrict demand.  Business wants the banks to lend, lower taxes and to increase demand (not that I agree with the second one) for their products to grow, not the power to sack on demand.

The current balance is about right and it works. The coalition and in particular the Lib Dems would do well to remember the dictum, “if it ain’t broke don’t fix it”.  The legislation that currently exists has been developed over decades to improve the balance between the rights and responsibilities of employers and employees and have created an environment where companies manage and develop staff, rather than use the threat of dismissal to motivate/inspire fear (delete as appropriate).

So why have I got a bee in my bonnet over Beecroft?

 

Compensated No Fault Dismissal

This recommendation removes constructive dismissal, allowing no fault dismissal to largely replace redundancy. It gives carte blanche for employers to sack without reason or recrimination unless such a sacking triggers a ground for unfair dismissal. Beecroft points the finger at public sector managers, claiming they are more reluctant to dismiss than those in the private sector without producing evidence to support this contention.  My experience suggests managers in both sectors are reluctant to dismiss, viewing it as a last resort. The no fault dismissal allows compensation only of up to £12,000 dependent on length and type of service.

This proposal would effectively tear up the Employment Relations Act and subsequent amendments to improve workers’ rights under it. Yet, it ignores the reality that poor employee performance is often, at least in part, attributable to poor management. So rather than tackle that condition, Beecroft gives managers a sackers’ charter which will allow poor management to flourish. This would be bad for business, demand, growth and people who would have to work with the constant threat of being sacked hanging over them like a sword of Damocles.

There already are powers to dismiss as a result of poor performance but they are often used improperly or inconsistently by employers, resulting in tribunal claims. Performance management of staff is critical to make the most of them and that includes reward as well as discipline, something which Beecroft neglects. As a wise aunt once said “you catch more flies with honey than with vinegar” and Beecroft’s proposals distil only vinegar, attaching blame to employees above all else.  He also seems not to understand what probation periods are for.

Also of concern is the extension of tribunal qualification to two years. This will also have a disproportionate effect on women dismissed in pregnancy (unfairly) and on the ability of individuals to challenge the grounds for dismissal in the first year of employment.  It represents a substantial erosion in employee rights and could lead to the reinstatement of poor employment practices that the availability of tribunals at one year had begun to weed out, particularly keeping the minority of unscrupulous employers honest.

 

Exemptions for Small businesses

Beecroft proposes that small businesses should be allowed to opt out of statutory duties on unfair dismissal, pension auto-enrolment, the right to request flexible working (other than for parents and carers, which is required by a European Directive), flexible parental leave, licensing for employers of children, gangmaster licensing and equal pay audits.

The most worrying of these, in light of the Morecambe Bay tragedy, is the opt-out of gangmaster licensing. All gangmasters tend to be small businesses with a highly casual workforce, and employee abuses  – spurious deductions from pay, below minimum wages, employing illegal immigrants, flouting health and safety law – tend to have occurred as a result of the lack of a licensing system. This area of employment, together with the employment of children, require regulation to provide some protection to the most vulnerable workers.

The withdrawal of the ability to flex parental leave between parents might work against small companies, as it effectively forces mothers to take all their maternity leave instead of sharing it with their partner.  Having worked in a small company, employees tend to take a more pragmatic approach to matters like parental leave: many individuals often elect voluntarily not to take all their entitlement but that does not mean they should lose their legal entitlement to such protections and conditions.

Pension auto-enrolment might be the bane of employers, but it is good news for employees everywhere, in their retirement.  Over half of the UK population has no provision outside of the state pension;  to scrap this measure for small companies is short-sighted and will result in individuals suffering poverty in their old age, putting additional strain on services and society.

Perversely, this recommendation could make small companies – the majority of firms in the UK economy – less attractive places to work.  Far from enabling growth, it could stifle it.

 

Discrimination law

The rescinding of third party harassment provisions in the Equality Act 2010 would mean that employers will no longer be responsible for preventing staff suffering discrimination from colleagues or customers.  This statutory protection has always been about establishing a safe environment for all employees, free from all discrimination:  removing it would represent a retrograde step.

Beecroft suggests that it is “naive in the extreme” to think that discrimination can be prevented through policies on dignity at work, bullying and harassment for staff.  What is naive is thinking that rescinding such protections will do anything other than increase the potential for discrimination.

The report also recommends the re-application of the default retirement age at a higher age than 65 to enable companies to remove underperforming older workers and to encourage hiring older workers at the same time. Yet, it was EU law on age discrimination that removed the default retirement age; it remains to be seen if the UK has the power to reinstate it.

The retention of older people in the workforce can present a barrier for younger people but labour statistics show that older people are suffering some of the highest levels of unemployment currently.  Reinstating the default retirement age without researching the implications could be counter-productive at both ends of the employment age scale.

 

Employment Tribunal process and awards

The key changes here are the introduction of fees, capping of loss of earnings awards and the introduction of a reduction in basic and compensatory awards. The report also suggests that the use of no-win, no-fee arrangements for tribunal claims be reviewed.

Beecroft recommends fees of between £200 and £750 for claims up to £29,999, depending on their size and complexity, and £3,750 for higher claims. The ability to pay would be based on wealth as well as income.

These costs would deter many from taking up potentially valid tribunal claims (even though in practice many would see the fees remitted if they met income and wealth criteria). This is a policy that puts a price on access to fair treatment and should be opposed vigorously by the trade unions.

By focusing on preventing frivolous tribunal claims, Beecroft is ignoring reality, in that very few matters reach tribunals, with most cases being resolved locally. Tribunals are a necessary last resort, for which the bar is already relatively high – many claims fall due to legal issues – and as such should remain free at the point of making a claim. In effect, he is trying to ‘solve’ a problem that does not exist.

Currently, certain tribunal awards are uncapped, including those relating to discrimination.  Beecroft would change this, hampering tribunals’ freedom to pay appropriate compensation and establish deterrents against future errant behaviour.  Again, this is a measure which would reward poor management at the expense of employees.

 

TUPE

The report recommends changing TUPE protection to one year and lobbying the EU for significant change, to allow, inter alia, an immediate redundancy option post transfer.  Currently, TUPE protects employment terms and conditions of employment for up to two years when a company or organisation changes ownership. After that, employers can negotiate/enforce changes to contracts of employment to harmonise terms. In its current form, TUPE provides a reasonable time to allow for adjustment and negotiation and to protect lower paid employees from the effects of contractual changes for two years.

Reducing TUPE to a year will remove protection of working conditions more quickly, such as pension provision, holidays and contracted hours.  As TUPE transfers tend to protect lower skilled and paid roles eg dinner ladies, refuse collection, personal care, transaction finance/HR, it is easy to see how Beecroft’s proposal could hurt those workers on low incomes hardest.

 

Conclusion

The Beecroft recommendations signal an open declaration of intent by the UK Government on normal working people. Socio-economically the changes would affect the most vulnerable and poorer workers disproportionately.  Many of these are women.

And while the trade unions can be expected to fight these changes, what of employees – often poorer – who work in non-unionised workplaces.  Already, they are often viewed as ‘disposable’ due to their skill level and are often unaware of their rights.

Consequently, they are most at risk from the impact of poor management and employment practices.  Exempting small businesses from many key employment protections makes employees here – in the vast majority of workplaces across the UK – much more vulnerable to poor practice.  The same applies for temporary contract workers.  If this sackers’ charter goes ahead, expect more temporary and fixed term contracts and sackings before twelve weeks to prevent employees assuming rights and protections.

For all these reasons – and more – Beecroft is wrong.  He has taken no account of the potential human impact of his policy advice nor has he provided evidence to back up his economic arguments.