Last year, Richard Desmond, the proprietor of Express Newspapers announced he was paying himself a chairman’s remuneration of some £52m – the equivalent of £1m a week.
It hardly raised an eyebrow.
Although hefty by historical standards, it was not by contemporary ones. Just a few months earlier Lakshmi Mittal had paid himself a record £1.1bn dividend. At the time it was the highest private dividend on record. But that record did not last for long as high street
retailer Philip Green topped it with a dividend of £1.2bn from his Arcadia
Group – the equivalent of the annual pay of 54,000 people on average earnings.
When it comes to top salaries, dividends and bonuses, the last decade has seen one record after another tumble. Take boardroom pay. The total average earnings of the chief executives
of the FTSE 100 companies have doubled over the last five years – rising five
times as fast as average pay.
In the last financial year UK
corporate bonuses topped £30bn.
It is little wonder that amidst such corporate greed, amidst a system bedevilled by failed light-touch regulation, short-term profiteering, under-investment, and a craven acquiescence to the demands of the wealthy and big business we now face a devastating recession – a
recession which will be laid bare in grim statistics and graphs but which will
spell human misery for millions of working people
Financial Times columnist says: “I now fear that the fragility of the financial system with the huge rewards that it generates for insiders will destroy the political legitimacy of the market economy itself. So it is time to start thinking
radical thoughts about how to fix the problems”.
When Alastair Darling appeared on TV
to announce the bail-out, and he reassured us that things were returning to
normal, I was sickened. For me and my members we don’t want a return to the
past – where workers are forced to opt out of the working time directive on
pain of losing their job, where anti-union laws shackle our rights, where
asylum seekers are scapegoated for society’s ills and the BNP fill the
political vacuum in too many of our communities, where short-term profiteering
undermines our industry and we pay the price in lost jobs, low pay, long hours,
stress, where health and safety is compromised in return for a quick profit.
The most recent government survey
shows that the country’s wealthiest 1% own 34% of the wealth. The poorest 50%
owned just 1% of the wealth. One in four workers earn less than £12,000 a year,
three-quarters less than £30,000.
Yet those who helped bring about this
crisis will not be made to pay. Whilst the crisis has hastened the end of final
salary pension schemes, the former head of RBS, rescued by the taxpayer and
which just yesterday announced 3,000 further job losses, will enjoy a pension
of £579,000 a year.
f the City was the goose that laid
the golden egg then it is clear it is past its sell by date and the stench –
the stench of corporate greed – has become overpowering.
And as people struggle to avoid
repossessions, to hang on to their jobs, to meet rising fuel and food bills, to
cope with inflation the government has responded by bailing out the banks with
workers’ taxes – and working people will pay with their jobs, their homes,
their wages as redundancies sweep every sector and every region, as house
prices collapse, as public finances are squeezed, as communities suffer and
workers are asked to take pay cuts, pay freezes or below inflation rises to pay
for the years of greed and profiteering.
Mass unemployment was not a price
worth paying under the Tories. It is not a price worth paying under New Labour,
as predictions are that up to two million could be out of work by Christmas.
This is an opportunity to bring about
a fundamental transformation in our economy and society. How come Martin Wolf
can see it but Government Ministers can’t? How come Peter Mandelson thinks we
should be “intensely relaxed” about the super-rich and the growing gulf between
rich and poor. How come John Hutton believes there is nothing we can do. I’m
sure we’d all like to tell him what he can do.
Ed Balls rejects the London Living
Wage – just £7.45 an hour – as artificial, inflationary, not necessary or
appropriate, claiming it could distort labour markets and prove poor value for
money. What utter garbage. I’ll tell Ed Balls what distorts the market – City bonuses.
And Gordon Brown talks not of using
our ownership of the banks to deliver social policy but of returning the banks
to private control as soon as possible. It is clear they want us to subsidise
the banks in the bad times, simply to allow them to return to the profiteering
role which was central to bringing about this crisis.
We used to say when campaigning for
public ownership that you can’t control what you do not own. Now apparently you
cannot control what you do own.
Just as many of our financial
institutions are bankrupt so too is New Labour, so too is their neo-liberal
dogma.
Because this is not a question of
resources it is a question of political will.
I’ll tell you what they could do. They
could start by putting an end to the tax avoidance of the rich and the
corporations with their fancy lawyers.
Britain’s billionaires – boasting a
combined wealth of £126bn – pay themselves in artworks, gold and fine wines to
avoid tax. They pay a smaller proportion of their income in direct and indirect
taxes than the poorest 20% of the population.
Whilst job centre staff are laid off,
£33bn annually is lost to tax avoidance. The actual rate of tax paid by the
fifty largest companies has fallen over the past seven years.
Just that lost tax could pay for a 10%
increase in the state pension or could build an extra 60 hospitals.
Just one quarter of the total tax lost
to avoidance activities of the few would be enough to provide five and a half
million public sector workers, who are currently facing the prospect of a real
terms pay cut, with a pay settlement equivalent to the rise in average
earnings.
Yet the government has failed to act.
It stands steadfastly by the now discredited light touch, hands-off regulation.
I want hands on. Hands on the wealth, the unpaid taxes, the profits made from
the exploitation of labour and for that wealth to be used to fund education,
health, public services, jobs and for the colossal resources available to us to
deliver our social policies.
It is not a question of resources but
a question of will.
So while the bank bail-out saves the
banks, protects those with savings, shores up capitalism there is precious
little about bailing out the poor.
When will the government bail out the
13.2 million people in poverty, the 2.1 million pensioners living in poverty,
the students starting life in debt, the homeless and the rest of the poor and
disadvantaged.
Comrades, in past years we’ve met –
and been looked on as slightly quaint and old-fashioned with our ideas of
regulation, public ownership and yes, socialism. No longer. Our ideas today
have more relevance than ever.
For the rest of the day I am sure we
will debate mechanisms, structures, alliances, conferences, conventions,
manifestos and more….it is right that we do so. But let us not get sidetracked
from the immediate tasks and the battle of ideas.
We should be using our ownership of
banks and financial institutions to appoint worker directors, to put in place
spending policies aimed at dealing with social problems, ending the dividends
to private shareholders and putting an end to repossessions.
The TUC should be convening an urgent
summit to mobilise the labour movement to defend jobs and living standards –
building a united struggle across the public services. They should be building
on joint action over pay to develop a labour movement-wide campaign against job
cuts.
We must arm our movement with a
fighting programme –
The right to a job, the right to a
home, to bring in to public ownership the finance and building industry to ensure
we can plan and build the affordable housing needed.
To bring in to public ownership those
profitable companies threatening widescale redundancies and run them in the
public interest.
The objective cannot be simply to
recapture the economy and society we had pre-crash. It must be about creating a
Britain – and a global system – where the long-term needs of people are put
before the short-term gains of financiers, where social policy trumps fiscal
policy, where the value of a nurse or firefighter or public servant is more
than the value of those who run hedge funds or those who gamble and speculate
with our money but produce nothing.
This is an opportunity to bring about
a fundamental transformation in our economy and society.
