CSR special: the union responses

As you might expect a Comprehensive Spending Review that intends to cut almost half a million jobs and risks losing half a million more in the private sector has provoked some sturdy reactions from trade unions. We've already seen that UNISON are unimpressed - but what about other unions?

The TUC damns the CSR as a "political project". I certainly agree that "yesterday the government launched a radical programme to roll back public services and sack public sector staff, even if this makes it more likely that the economy goes into reverse" although I'm less clear that "Voters have always rejected policies to make huge cuts to public services at the ballot box" is actually true - people did vote for the Lib Dems and Conservatives, and frankly Labour's policy was always for cuts, just less sharp, less fast.

To be honest it comes across as a Labour press release rather than a union one with it's reference to the ballot box.

Public Sector union PCS (which is not affiliated to Labour) has a much clearer, and less sloppy, approach describing the cuts as cruel and immoral. They put welfare cuts to the front of their concerns saying "These £18 billion cuts are a fundamental attack on the welfare state, targeting families with children, the sick and disabled, those on low incomes, and pensioners."

Mark Serwotka, PCS general secretary, said "This government has no strategy for creating jobs, and is instead demonising those without them - these are the cruel actions of an immoral government with no mandate and no strategy."

Billy Hayes, leader of the CWU who represent postal workers and others, said that "The volume of cuts also threatens to leave parts of the country away from the south east struggling with mass unemployment as public and private sector jobs fall to Mr Osbourne's axe."

He also pointed out something that I'd noticed too; "At CWU we're confused why the Chancellor included a promise on post offices in his address as there is no detail about how this funding would be provided. The network currently relies on £150 million annually from the government to keep rural and urban branches open, but with no detail this is an empty promise from Mr Osbourne."

Education union UCU says that "It is hard to see the rationale behind slashing college and university budgets when they generate massive economic growth for the country and when the alternative is more people on the dole and the state losing out on millions in tax revenues.

"We are appalled to learn that education maintenance allowances are at risk and funding for people who do not speak English is being abolished. The simple message here seems to be 'don't be poor. It's no good the chancellor describing universities as the jewel in our economic crown and then following those warm words up with massive cuts. Every MP with a college or university in or near their constituency should be clear that the cuts will put those institutions at risk."

Firefighters' union FBU have identified "Ten thousand fire service jobs are under threat from government plans to slash 25 per cent from fire and rescue service budgets over the next four years"

Matt Wrack, general secretary of the FBU, said: “These pernicious cuts must be fought to defend public safety. They are not inevitable, but politically driven. The FBU will oppose these draconian attacks on an essential frontline service and robustly defend the key role firefighters play in keeping communities safe.

“We cannot just meekly roll over and accept this. Neither should the employers. Firefighters are professionals – and we won’t stand by and see our service dismantled piecemeal.”

"In announcing the measures in Parliament, Chancellor George Osborne encouraged fire and rescue services to compete for the shrinking pot of public funds. He said that fire and rescue services could “limit budget reduction in return for substantial operational reform”. Measures mentioned include “flexible working arrangements” and “pay restraint and recruitment freezes”.

Matt Wrack commented: “This is pitting one fire and rescue service against another as resources dwindle, rewarding those who drive down pay and conditions and penalising the rest more. It is bullying and divisive.”

The RMT use their frontpage to highlight the various protests that are taking place up and down the country on Saturday (cut and pasted below). Another different tack they chose to take was to attack the rich rather than defend the poor. I like it.

"The “UK Transport Rich List” is topped by Keith Ludeman – boss of the Go-Ahead group – who saw his salary rise by an incredible 35% from £916,000 on the June 2009 figures to £1,240,000 in July this year. Ludeman is responsible for the Southern Trains franchise which recently announced it was axing toilets on the key inter-city route between Portsmouth and Brighton.

"Hot on his heels are Brian Souter from Stagecoach on £762,000 and David Martin from Arriva on £743,635. (A full list is attached.) Company profits show that the big five UK transport operators have posted combined dividends of more than £2 billion since privatisation."

Mr Crow, RMT leader, added "Under this ConDem government the public will be forced to pay through the nose to travel on crowded trains and buses on creaking and unsafe infrastructure while the profits, dividends and top bosses salaries of the private companies are ring-fenced. That is a scandal."

• London: Assemble 11am at RMT head office, 39 Chalton Street NW1 for march to SERTUC rally at Congress Huse from noon
• Edinburgh: assemble 11am: at East Market Street
• Cardiff: assemble City Hall at noon
• Belfast: assemble 1pm College of Art Gardens
• Bristol: assemble 11am Castle Park, march to Bristol City Council, College Green
• Cambridge: assemble noon Parkside Fire Station, rally 1.30pm, Guildhall
• Derby: 'Derby People's Day' , Market Place, noon to 3pm, Speakers, music and street stalls.
• Lincoln: assemble noon at Castle Square, march to rally at Cornhill at 1pm.
• Sheffield: assemble outside City Hall, 12.30

CSR special: Ring-fencing NHS, schools and aid

There are a number of departments that the government has protected from themselves (which is obviously very merciful). To much headlines the NHS, schools and DfID are all areas where the Comprehensive Spending Review has not bitten... or did it?

The NHS budget is protected with an extra ten billion over the next four years, the schools budget retained and to much trumpeting aid is, in fact, increasing. However, this is not the whole story.

Many health campaigners are understandably confused at the way the coalition say the NHS is safe in their hands but they still seem force to fight to retain services and fight privatisation. roughly one in five trusts admit that they have closed down a major service or department in the last few months. The privatisation is ongoing Tory/Labour policy but why should services be closing down if the money's protected?

The answer is three fold. First of all the overall budget is ring-fenced, not individual services and the rise (of 2.5%) is actually less than the increase needed to preserve services. That means if the money is moved into one area it inevitably has to move away from another. The government is very keen on an extraordinary overhaul of the structures of the health services which, in itself will cost money that would have been spent on other services, leaving aside whether that reorganisation would be a good idea.

Secondly the capital expenditure is being reduced by 17% and there are twenty billion pounds worth of 'efficiency savings' already in the pipeline.

Thirdly, the increasing cost of drugs in particular (as well as additional strain of obesity and an aging population) mean that certain areas of spending are eating up more than their fair share of the cake.

Public sector union UNISON was very clear on how the ring-fencing will still mean cuts when they said that; "Patients and staff will soon see through the facade that the NHS is being ring-fenced, when at the same time it has been told to make £20bn worth of savings.

“The NHS is not safe. Some hospitals are already cutting back on vital life-improving operations such as cataract, hip and knee replacements. The NHS needs extra funding just to stand still. It will not be able to keep up with the demands of a growing elderly population and the cost of increasingly expensive treatments and drugs.

“The Government’s latest NHS “reforms” will intensify the market and introduce more private sector provision. They will cost £3bn to implement and create havoc and instability just when the NHS can least afford it.

“Staff are facing a two year pay freeze, many vacancies are being left unfilled, pensions are under review and the number of managers will be cut by 45%. Another Tory broken promise – the NHS is under siege – it is not being protected."

So what about schools?

Well, this is slightly different. Back to UNISON; “The coalition is being dishonest by saying that the schools budget will be boosted. Schools also get vital funding and support services from local authorities, which are being hit by drastic cuts. Many will struggle to afford to help schools support children with special needs, or run truancy units. Schools will have to dip into their own funds to pay for these essential services.

“Up and down the country schools support staff are facing losing their jobs. It all adds up to mean cuts will disproportionately hit on children with additional needs in schools.”

Essentially the 'schools budget' makes up only a portion of the total moneys that schools receive which is why specialist services, like one to one tuition are under threat. Local authorities, as we have already seen, are under a huge amount of financial pressure and it would unbelievable if their contribution to schools did not suffer.

Oh, and then there's the lost funding of the Building Schools for the Future programme which lost billions in investment for schools in dire need of refurbishment. In fact, after the fiasco of the handling of BSF scrapping (which turned out to be a hell of a lot more popular than Gove expected) it's arguable that it would have been impossible to take more out of schools than they already have.

Aid

Now, surely I should be overjoyed to hear the news that there will be a significant increase in the aid budget? 37% over four years looks pretty good, especially in the context of the cuts. Well, let's take a closer look first.

Tucked away in the Foreign and Commonwealth Office cuts it turns out that a number of their projects will now be delivered by DfID, how many and how much they will cost is left unanswered as yet. More importantly while the FCO is to "increase its focus on championing British companies to win export" they also account for a good portion of the increase in Official Development Assistance (ODA).

After all while other, much more useful, quangos went to the wall the Export Credit Guarantee Department who love the shady world of arms exports, etc, and all that entails.

I'm intrigued as to whether there will be any slippage between meeting the Millennium Development Goals and maintaining British financial interests. I should point out I'm not being artful here, it genuinely unclear so far - however - Section 2.97 in the Review states "British international development policy [to be] more focused on boosting economic growth and wealth creation".

Continuing my concern that the aid budget may be being used with an eye to British interests is that 2.97 continues that 30% of the ODA is to be used in conflict countries "with particular focus on Afghanistan and Pakistan". I'm really sorry to be cynical and I'm not down playing the fact that these two countries desperately need aid but for the British State to focus on areas where British troops are in conflict with the locals is not a coincidence.

Anyway, while an increase in the aid budget is always welcome we should ensure that aid should be used as aid not as an adjunct to business interests or the military effort.

While we're talking about DfID it's to be welcomed that a *new* quango overseeing how the money is to be spent has been set up however I'm concerned by the idea that DfID is to be a "leaner organisation with a focus on managing aid efficiently and effectively, by seriously reducing back office costs." Sorry to be picky but cutting admin costs does not automatically make you more efficient and effective.

Indeed DfId had already been streamlined under Labour and this had resulted in severe restrictions in the number of projects they could manage. The consequences of this is that aid will tend to be delivered either by the very biggest NGOs or consortiums of large NGOs.

Smaller international development organisations (of which there are many) already find it extremely difficult to work directly with DfID because they simply do not have the capacity to work with the small fry. The Coalition's proposals will simply deepen this trend driving small specialist NGOs out of business while heaping money on their super-sized cousins.

All in all what I'm trying to say is that it is not surprising that the Coalition have tried to win as many good headlines as they can amid the carnage - but ring-fencing services does not, in this case, mean that the future of those services are secure.

CSR special: Science

We've seen headline responses that science has been saved from the axeman, that over the next four years it's budget will be frozen in cash terms - which is a real term cut of 10% over the period at a time when similar nations are investing in vital new technologies. Cameron himself said that this was a "good outcome for science".

Well, compared to some other departments that is essentially true. Many leading scientists have had their first born returned to them unscathed and the testicle clamps have been put back into storage.

However, let's not get too excited (as if), government spending accounts for 30% of the total spend on scientific research in this country and helps support the other 70% which comes from NGOs, private companies and abroad. That 10% cut, was described by Science is Vital head honcho Imran Khan as "a 30% or 40% decrease in new PhDs that we'll have next year for instance".

It will be some months before we see what the specific outcomes are for university departments as it is in the purview of Master Thaumaturgist Vince Cable to decide how the funds are allocated but it is worth pointing out that specialist teaching in schools is in doubt and HE funding more generally is undergoing a massive 'overhaul' which could see radical changes over the next few years in the shape of HE education.

Kudos to the science campaigners for their effective campaigners in this field and I don't want to understate their achievement. I will say though that even where the budget has not hit hardest it still lacks vision for the future.

The idea that, right now, we should not be heavily investing in flood defenses, research in renewable technologies and technologies to help us save energy while revitalising our manufacturing industry for home and export just seems really short sighted.

CSR special: Environment

The Comprehensive Spending Review has a few cheap headlines in it for the environment - but sadly this amounts to a bit of window dressing amid some pretty hefty carnage. Before we start looking at the poor old Department of Energy and Climate Change let's look at transport first.

The Department of Transport is facing a 12.6% cut (an 1/8th of it's budget) and there will be a sharp rise in rail fares. That's right, in a country that already has massively overpriced rail tickets we're going to see above inflation rises.

Some infrastructure projects have been saved, like Crossrail and Thameslink, but Network Rail has promised savings by putting on hold plans for new carriages to ease overcrowding. So no new capacity, but even more expensive to travel. However High Speed Rail 2, a stonkingly expensive project that may not move anyone off the roads onto trains looks set to go ahead.

Fear not though because the road building continues with an extra lane of gridlock planned for the M25 and others. Don't worry if you're concerned about buses clogging up these precious new roads because the fuel tax subsidy to bus operators has been cut from 80% to 60% which will mean less services and higher fares - particularly for rural and less used routes.

I'm also told that even walking and cycling provision will be hit as this comes under the remit of local councils who are all facing their own massive funding crisis.

Department of Energy and Climate Change

The DECC budget will be reduced by 33% over the next four years which includes cuts in insulation subsidies, the renewable heat levy, subsidies to feed-in tarriffs and the Severn Barrage which is to go to the wall. Admittedly this was a controversial project that would have supplied a good deal of renewable energy at the cost of the local wildlife and habitats.

Between three and eight thousand jobs will be lost in the department out of a total of 30,000. Hundreds of nature reserves are likely to be sold off and grants to institutions like Kew Gardens and the Royal botanic Gardens are to be cut.

Half a billion is to be shaved off the explicit flood defences budget on top of the expectation that local councils will be cutting back on local flood prevention provision. There's also going to be cuts in animal disease prevention with the private sector being expected to take up much of the slack.

Both of these moves look quite dangerous to me, and a repeat of the foot and mouth disease outbreak a few years ago and/or new flooding like last year would cost the economy and the government dear. Yet another false economy.

However, there will be one billion for the experimental technology Carbon Capture and Storage and another billion for a 'Green Investment Bank' to help deliver new projects. However, the department has been particularly badly hit by the 'bonfire of the quangos' that were already funding projects and groups like the Carbon Trust and Energy Saving Trust will suffer so whether the GIB is a move forwards or not seems a little doubtful to me.

However, in the context of green job losses and budget cuts the occasional piece of good news is hardly earth shattering. Certainly this is a million miles away from the million green jobs policy of investment that we need, although what on Earth the 'Green Deal' turns out to be is anyone's guess.

The report also contains the chilling phrase "the DECC will develop innovative ways of working with the private sector, acting as an enabler rather than a provider." Presumably because they'll no longer be in a position to provide anything.

Bizarrely the Lib Dem minister Chris Huhne said: “DECC is playing its part in tackling the deficit. Like the rest of the public sector we have taken some tough decisions, but we remain on course to deliver on our promise to be the greenest government ever. We will help create green jobs and green growth - and secure the low carbon investment we need to keep the lights on.”

CSR special: Housing

The Comprehensive Spending Review spelled some extremely bad news in the housing sector. It's a review that will cause hardship for many and homelessness for thousands. It's not simply that Osbourne scaled back the plans of building new affordable homes by 30%, there has been a general assault on rights and benefits that will lead to misery and homelessness.

The ending of Secure Tenancies for council house tenants is the end of an era. The post-war settlement that created affordable homes for working people was a massive attack upon one of the great divides in society - decent housing. As council houses have been gradually sold off the stock has more and more become a backstop to house the most vulnerable in society rather than ensuring the majority have somewhere decent to live.

Those secure tenancies were there to give the poor stability and reassurance, a firm base upon which to build a life. These moves entrench the shift towards using council housing as emergency, short term accommodation - a shift already well underway with the breakup of council housing stock a the growing use of 'Social Landlords'.

As the Telegraph reports there is also a new rise in rents; "new council house tenants face a steep hike in living costs, offering intermediate rents at around 80 per cent of the market rent."

Housing is the bedrock of any community, and as Eileen Short, chair of Defend Council Housing and sister of a well known former minister, said recently (doc) "Attacks on secure tenancies, cuts in housing benefit and forcing up rents will create more debt, evictions and homelessness."

The attacks on housing benefit have been signalled well in advance and we know they will lead to both a new wave of homelessness and an exodus from high housing areas, like London, which already suffer from a lack of essential workers unable to afford high rents and/or mortgages. Indeed this feeds into the benefit cap of £500 a week per household as a family living in a high rent area will find it very difficult to cope with rising rents.

The Citizens Advice Bureau, in a hard hitting press release condemned the CSR and pointed to the that;

"Housing benefit has already been cut back and the extraordinary decision to raise single room rate to 35 year-olds will lead to an explosion of homelessness, and will hit single working people on low incomes as well as the single unemployed. The measure to restrict contribution-based ESA to 12 months betrays people who have paid contributions all their working lives and become sick or disabled.

"We advise millions of people every year, who are often on very low incomes or rely on welfare benefits and public services. They told us that their top priorities for the spending review were simplification of welfare benefits, free to use government helplines and affordable housing. We welcome the announcement that the welfare benefits system will be simplified to make it easier to understand and navigate. In the meantime we urge the government to maintain and continue to improve service standards and ensure the new system is designed with the needs of service users in mind.“

The single room rate, which I'd not even been aware of until the CSR, will mean that under-35s will only be able to receive housing benefit if they are living in shared accommodation. So if you're currently working for the public sector and living in a small flat a redundancy notice will mean you're out on the street as well as out of work.

The news that the government was to spend less in housing did not just mean that the 30% less new build would mean that the more than a million on the waiting lists for social housing would have to wait that bit longer. We also saw an immediate hit on the shares of Barratt Developments (down 4.4 percent) and Taylor Wimpey (down 5.56 percent). The National Housing Federation warned that 1.7 percent of jobs in the construction industry could be lost.

Federation chief executive David Orr said: "The fact that the housing budget is being cut by 60% is deeply depressing – and shows that providing affordable housing is no longer a government priority. Cuts on this scale will come as a devastating blow to the millions of low income families currently stuck on housing waiting lists.

"The harsh reality is that because of these cuts, the new social homes this country so desperately needs, can now only be built by dramatically increasing rents for some of the most vulnerable and poorest in our society. Most tenants simply won’t be able to cover these extra costs, and as a consequence make it more difficult than ever for people to escape the poverty trap and benefits dependency that the Government has repeatedly said it wants to tackle."

All-in-all extremely bad news for anyone not rolling in money. Remember kids, Nick Clegg says the cuts are fair, and I quote "the review is one that promotes fairness, underpins growth, reduces carbon emissions and localises power."

CSR special: overview

The Comprehensive Spending Review yesterday was pretty much what we expected. Only the Kitten Torturing Budget and the Chinese Burn Department were left relatively unscathed - although under the KTB reforms civil servants will now have to supply their own waterboarding boards, as an efficiency saving.

In the words of Private Frasier: "We're all doomed". But there's a silver lining to the mushroom cloud... oh no there isn't that was the flash of a second nuclear explosion creating a second mushroom cloud, my mistake.

For me we have a budget that will end up costing us money, rather than saving it. The half million public sector workers who will lose their jobs, and the estimated half million more of private sector workers who'll follow as a result will lead to a social catastrophe.

It's worth remembering of course that the Thatcher government came in promising to tackle the welfare bill and despite putting her best demons on the job the welfare bill rose and rose year on year. That's because the Tories work under a false assumption - that the welfare bill is so high because of horrible, lazy people claiming stuff instead of having the good grace to go into the study with a pearl handled revolver.

The welfare bill rose because of mass unemployment, a lesson they could learn today. I'm wondering whether we're going to see the Liberals and their Tory friends going into the 2015 election having destroyed millions of lives AND having failed to cut the deficit because they'd spectacularly failed to reduce welfare payments despite behaving like utter shits to claimants and the disabled.

In this sense the CSR could well end up not just being a failure in terms of social justice and equality (which it certainly is) it may also be a failure in Osbourne's own terms. It's one thing to say that you'll cut the welfare bill by eight billion quid, it's quite another to see that happen at the same time as laying off hundreds of thousands of people who were doing productive jobs.