Perhaps the more accurate headline should read; Fat-Cat business vs. Bloated public sector?
Depending on which side of the political divide you come from, you will get a different answer! Why should that be the case I hear you ask! Well put simply, or dare I say, crudely, the leftists have always favoured state-owned monoliths, over-manning and heavily unionised workforces. After all, if you’ve detested capitalists for the entire history of your party, you’re not going to be comfortable taking hefty donations from fat- cat industrialists who make their profits off the backs of the working class when you can be more virtuous by taking largesse from fat-cat unions who make their profits …. well. !!…. off the backs of the working class actually!! Yes I know, it doesn’t make sense, but that’s just the way it is!
There was a single exception to Labour’s socialist mind-set; Tony Blair! He was “extremely relaxed taking money from the filthy rich!” (His words, not mine!)
With a foot in both camps, he couldn’t fail. Business and industry fell for the snake-oil salesman; Teflon Tony charmed their wallets open and still managed to keep the die-hard unions’ on-side. Of course, it could not last forever, and it didn’t!
That’s why we now have Jeremy Corbyn! The Labour movement were just as deceived as the capitalist bosses, but the hard-left felt the shame hardest. They realised Blair was the most extreme example of greed they had ever witnessed, he would think nothing of forcing your children up a chimney, putting grandparents in the workhouse, privatising the NHS and introducing tuition fees!!
How the hard left must loath themselves for allowing themselves to be so gullible and used!
So with the above in mind, it’s hardly surprising that fat-cat private business and industry have scurried back to the Tory party and the bloated public sector has got behind the big-state Marxist Corbyn!
There is now a clear divide between private and public sector!
Perhaps now is a good time to look at the recent history of the conflict.
Whilst there has always been a public sector in our long and proud history, it was mostly confined to our military and civil service, particularly during the growth, and even the demise of our empire. The real change came during the Second World War with the Beveridge report of 1942.
Prior to the Beveridge report, the Liberal party from as far back as the 1830s had pressed for social and working conditions reform in efforts to relieve the burden and improve life expectancy of the poor. All very creditable stuff and slow progress was made. The old age pension and many housing and working conditions acts were forced through parliament, often voted down by the Tories! Not entirely unexpected as during those times they were the landlords and employers who were most likely to take a hit in their profits in all this – turkeys don’t vote for Christmas do they?
But then came the two world wars and through the necessity of national security of means of production and transportation, nationalisation of the railways, mines, utilities and communication, to name but a few, was instigated. It’s worth noting that the United States never nationalised any of these industries yet still managed to win the second world war through industrial might and go on to become a world superpower in military and production terms. However that is a discussion for another day!
In post war Britain, austerity prevailed, whilst the US boomed with the American dream, an abundance of food and luxury goods!
In 1945 Labour won their third general election and enthusiastically adopted the recommendations of the Beveridge report, in effect, the beginning of the welfare state as we know it today. The National Health Service was the most significant, and, as we now know, the most controversial.
Throughout the 1950’s, 60s and seventies, nationalisation and the welfare state – “The Public Sector” – eclipsed the “Private Sector” by swallowing up shipbuilding, car manufacturing and steel production; it was a socialist’s wet dream come true! The unions flexed their muscles and bullied successive governments with unrealistic pay demands, holidays and pension deals. If they couldn’t get what they wanted, they would bring the country to its knees by way of strikes and withdrawal of utilities, in the knowledge that if prolonged, private enterprise would fold and mass unemployment would follow, with the public pointing the finger of blame at the incumbent government! It was a ghastly time to live through.
With the major industries in public ownership – the private sector was far smaller and stupendously heavily taxed – the successful and wealthy were a target for high taxation, some of our greatest entrepreneurs were paying over 90% of their earnings to the exchequer. Many fled to the colonies; such as the US, Australia and Canada! The Rolling Stones and Tim Berners-Lee (British inventor of the internet) were just two of what became known as “the brain drain”. The nationalised industries never turned a profit, in fact they consumed eye watering subsidies, the Taxpayers were made to foot the bill. Interest rates and inflation were well into double figures and Britain became known throughout the world as “the sick man of Europe”. In the late seventies the international monetary fund (IMF) were called in by Labour Prime Minister Harold Wilson and his chancellor Dennis Healy. Austerity, cuts and pay restraints were inflicted on Britain, in fact they were so severe that Labour Chancellor Dennis Healey cut more in 1 year 78/79 than George Osborne managed to achieve between 2010 to 2015! Just let that sink in!!
Throughout the extensive, uncontrolled growth period of the 1970s, the public sector became infested with socialists who could not see themselves working for private businesses and corporate enterprise! Teachers, nurses, civil servants, the fire service, police and local authorities became the natural home for those idealists who chose to consume profits instead of making them. They simply had no respect or understanding of the private sector, in fact they deliberately did not wish to. It was distasteful and repugnant to them. Public Sector employees had never really experienced a pay and pensions advantage over their Private Sector rivals. In fact, for many years they had been the poor relation, public service was seen as a privilege, a duty by many in those innocent times of need. Income parity was their initial goal and through the powerful union movement during those years of state ownership and intervention of the 1970s Public Sector pay and conditions became the overriding aim of the union barons. It was also during those times that recruitment in that sector began to expand exponentially.
From the early 1980s – under Margaret Thatcher’s stewardship, this direction of travel in the United Kingdom was significantly halted. As soon as the powerful miner’s union was despatched, the whole of the Public Sector became ripe for culling. Margaret Thatcher knew the power of the Public Sector was not because of the size of the trade unions, quite the reverse, the power of the trade unions was because of the size of the public sector! She took an axe to those nationalised utilities and loss making monoliths by selling them off to private investors, either for profit or, more controversially, asset stripping. Her motive was clear, reduce the Public Sector payroll and you starve the union beast of its funding. Yes, it was idealistic, but it was also a logical way to inject cash into the economy and reduce the subsidy burden on the hard pressed taxpayers.
With deregulation of the city of London’s stock market, Britain became a wealthy, aspirational place to live, many other countries around the world created their own “Big Bang”. Margaret had enacted the capitalist dream and turned it into reality. The right to buy further turbocharged the consumer market at home, but more importantly created a whole new army of Blue collar, home owning Tory voters.
Anti-union legislation was passed by strong Conservative government after government, benefiting from large majorities and the weak Labour leadership of Michael Foot and Neil Kinnock were powerless to intervene. It was during Margaret Thatcher’s second term of office that Corbyn was elected to Parliament. He was an open sore during Kinnock, Blair and Gordon Brown’s leadership of the Labour Party.
In 1997, Blair and Brown began to expand the public sector. Quangos, Local Authorities and the NHS were just some of the areas stuffed with left leaning acolytes – jobs for the boys – Universities and the media swelled their coffers and ranks with glee, it was the Public Sector and Labour’s equivalent of the “Big Bang” – funded by PFI, stupendously profligate borrowing, uncontrolled consumer growth, deregulation of banking and of course, selling off the gold!
The Public Sector headcount spiralled with health and safety officers, diversity officers, risk assessment managers, community liaison personnel and dozens of non-job box tickers! To hell with potholes and bin collections, those jobs were for the working classes and the Labour party had moved on from those awful, black and white days of class struggles, Blairism was now focussing on the immigrants, in-work benefit subsidies and the Public Sector middle classes for their core vote! They even had the Richard Bransons and Alan Sugars aboard, though they’d prefer to forget the Philip Greens and Fred the Shred (RBS), despite bestowing knighthoods on them.
By 2007 Blair was exposed as a Red Tory – his greed, warmongering and lack of conviction for social justice became his defining legacy – Nevertheless, he’d probably have won a 4th term in 2010 had he been unchallenged. But Gordon Brown had galvanised what remained of the hard left and besides, during their now infamous lunch at the trendy Granita eatery, he had promised Gordon he’d resign during his third term as Prime Minister, all was set for a new wave of Socialism using the now gargantuan Public Sector as their core 30% vote share, plus immigrants (as a result of the Blair years, there were now an extra 3 million of them) all bolstered by a new class of private sector workers who depended on in-work benefits to top up their low wages (low-skilled immigrants had actually forced wages down).
By now the Public Sector had not only surpassed the Private Sector on pay deals, but they had secured index linked
pensions, early retirement, jobs for life and no expense was spared on their working environments! They even enjoyed more holidays, sick leave and maternity benefits. It was a socialist’s utopia and it was still growing. Under Labour, state teachers became gods, local authority employees’ demigods and the NHS a religion!
When the financial crisis struck, Britain was spending 250 billion pounds a year more than it received in revenue, even today that annual deficit is 50 billion pounds, despite 7 years of so-called Tory austerity! Gordon Brown lost the election in 2010, and the newly elected Tory/LibDem coalition government attempted (unsuccessfully) to reign in the profligacy and steer the country towards living within its means. Their only fulfilled pledge was to reduce the public sector headcount by half a million whilst compensating those job losses with one million new private sector positions. This they have achieved, and a little more besides. Local authority funding has reduced in real terms by 40%. Defence and education spending has also seen a squeeze. But unfortunately, health, welfare and overseas aid provision have not been reigned in. There are billions to be shaved of these budgets in efficiency savings whilst improving user’s experiences. But the political will is nowhere to be found, what’s more, the government has failed to increase its majority at the last election, there is no prevailing mood of confidence to address these funding black holes.
At present, the 6 year Public Sector pay freeze is under attack from all sides. As terrorist attacks and the Grenfell tower tragedy thrust our emergency services, NHS and local authorities under the spotlight, a cynical, far left Labour party, led by Marxists Corbyn and McDonnell are politically determined to capitalise on these events, unashamedly grandstanding on the bodies of the victims, supported by their left wing mainstream media colleagues at the BBC, Sky news and Channel 4. Galvanising the gullible public into a blind frenzy, demanding unrealistic Public Sector pay increases despite the fact that the private sector is still lagging behind them in all aspects of pay, pensions, holiday entitlement and working conditions.
So in answer to the title of this article, NO! How can it be fair to boost Public Sector pay when the private sector, which was far more effected by the financial crisis than the Public Sector has still not achieved the parity it deserves.