Social and Economic Policy

Income shock

The Resolution Foundation cites business surveys to estimate that over one million workers out of the 9.5 million so far furloughed may lose their jobs completely when government furlough money stops at the end of October. It predicts a further “income shock” if the Tories stick to their plan to withdraw from April 2021 the £20 increase in Universal Credit which came with lockdown. That would mean an income cut of over £1,000 for over six million households. All that without factoring in the risk of a full-on second surge of the virus.

The UK has the lowest sick pay of all rich countries

On average, across all the 34 OECD (richer) countries, workers receive about 70% of their last wage as statutory (or mandatory) sick pay (SSP). It is as high as 100% in a significant number of countries. This sick pay has to be paid by employers for a period of time. In the UK it is up to 28 weeks. But the UK’s £95.85 per week statutory level is now the lowest, as a percentage of earnings, of all OECD countries. In the UK as elsewhere some workers are covered by agreements with employers which provide much better sick pay, but the low level of statutory sick pay is a scandal. Since the...

Make Labour fight for “grand schemes”!

Both the government and the scientists who criticise it say that finding people with Covid-19 symptoms, testing to confirm, tracing their close contacts, and getting sufferers and contacts to self-isolate, is central to controlling the virus. Shadow Chancellor Anneliese Dodds told the Marr show on Sunday 5 June: “I’m not going to say to you that Labour is going to be advocating some massive grand scheme right at this moment when social care is in crisis”. But we need grand schemes exactly at this time of crisis! The Tories’ floundering has imposed a massive grand Covid-19 death toll, threatens a massive grand risk of a whole new second wave of the virus, and is generating massive grand job cuts.

Poll scores won't save jobs

A survey — see here — by manufacturing bosses’ organisation Make UK published on 15 June indicates a big flood of job cuts in the next three months, July to September. They report only 11.7% of firms operating at capacity; 81% vs 39% predicting further falls in output in the next three months; a quarter of firms already having decided on redundancies; and only one-third saying they won’t make redundancies in the coming months. This week, starting 15 June, is the last time for bosses to send out the “HR1” letters required by law for large-scale redundancies if they are to take effect before the...

The rich pay lower tax rates

Up to £20 billion a year could be raised for public services just by taxing all income and capital gains at the same rate as earnings, argued a new report by Arun Advani of Warwick University of Andy Summer of LSE.An “Alternative Minimum Tax” (which already exists, in some form, in the USA) forcing everyone on more than £100,000 a year to pay at least a 35% tax rate on taxable income and gains would raise £11 billion. The best-off appear to pay higher taxes than most — a 47% “headline” rate. A few do pay that. Most use deductions and reliefs, and “repackaging” of their income as capital gains...

Labour movement activists on why we must take over the banks

The 2019 TUC Congress passed a proposal from the Fire Brigades Union for “public ownership of the big banks, which could play a central role in building a sustainable economy, investing in a publicly owned energy sector and creating decent, unionised jobs in the interests of working people”. No one opposed the motion – but very few are actually advocating or campaigning for this. Here we quote a range of labour movement activists and representatives on why it is so essential. In the current situation, as we face an implosion of credit and a snowballing slump, against the background of the...

Not the kitchen, but a teaspoon?

Labour right-winger Bridget Phillipson, installed by Keir Starmer as Shadow Chief Secretary to the Treasury, denounced the 2017 Labour manifesto as “all must have prizes” and “vote Labour and get not the microwave, but the whole kitchen”. Not the 2019 manifesto, even, but the 2017 one. In a leaked letter to her front-bench colleagues, Phillipson has now argued that there is a problem about “policy costings” not looking credible to the public and in the media. She calls for an “achievable road map” — suggesting the policies in Labour’s last manifesto (let alone the more radical policies...

A public care system must focus on independent living

I agree with Sacha Ismail's argument in his survey of social care that the system needs radical reshaping – though we may disagree about the shape. For me, the focus of social care needs to be independent living. Our priority must be enabling people to have control over the care they receive, whether through direct payments or commissioned care. People should only be living in institutions where that is their genuine preference, and should be given whatever resources they would require to live in the community. The number of care home deaths during Covid-19 really highlights the danger of...

Slump after the slump?

57% of US university chiefs say they will be cutting jobs in the coming months. Many US universities are expected to shut down altogether. In Britain, councils say they will face an unpayable £5 billion debt as they move out of the lockdown. Some are already planning cuts, and some are threatening to declare themselves bankrupt. Workers in some elderly care homes have been told that their jobs may disappear as the lockdown eases, since the homes will have fewer old people to look after. In Britain already, one and a half million people have claimed Universal Credit. Those who have lost jobs...

Covid-19: Bernie Sanders' six point plan

Bernie Sanders has drafted a six point plan for dealing with the coronavirus pandemic and the looming economic crisis – and the strange thing is that he doesn’t mention the presidential election nor the name of America’s current president, Donald Trump. While Joe Biden tries to make his voice heard from his basement studio in Delaware, Sanders remains an active member of the US Senate, fighting to get things done without waiting for the Democratic party primary season to end – and without waiting for Trump to be replaced in office either. “Congress must pass, in the very near future, the...

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