Posts Tagged ‘Royal Mail’

Private Eye on the Failure of the Government’s Privatisation of the Royal Mail

June 24, 2015

In its edition for last night fortnight, 12th -25th June 2015, Private Eye ran this piece about Cameron’s latest privatisation of the Royal Mail. It pointed out that the rationale for the sale of its last remaining shares in Britain’s oldest state enterprise actually contradicts the previous announcements about how transferring it all to private ownership would somehow improve service. The article states very plainly that this shows what a fraud and shambles the sell-off of the Royal Mail really is. Here it is.

Royally Screwed

George Osborne’s decision to sell the taxpayer’s remaining 30 percent share in Royal Mail defies the whole purpose of the privatisation and confirms what a rip-off the original sale was.

When the leader of the government body that ran the original privatisation in October 2013, Shareholder Executive boss Mark Russell, was questioned by a parliamentary committee a few weeks later, he explained that “one of the main reasons that we are pursuing this policy of bringing in private sector capital is we expected private sector disciplines to come in on the back of the private sector capital”, which in turn would increase the value of the company. So “the very reason we were maintaining the 30 percent shareholding was because we anticipated that over time there would be some movement of share price, and we wanted the taxpayer to gain from that.”

In fact the Royal Mail share price shot up simply because the sell-off was undervalued at 330p per share. The price hit 600p within weeks and after a year of supposed “private sector discipline” now stands at around 500p.

The further sale now is either an admission that “private sector discipline” does not work magic and there isn’t much more upside for the taxpayer to expect on his 30 percent, or a desperate grab for cash by the chancellor. Or possibly both.

PS. The same Shareholder Executive that was criticised by the National Audit Office as selling Royal Mail shares with “deep caution, the price of which was borne by the taxpayer” has now acquired UK Financial Investments, the arm of the Treasury that will soon be selling billions of pounds’ worth of bank shares – an unlikely empire expansion that the taxpayer might come to regret.

In other words, the Tories’ final privatisation of the Royal Mail is pretty much like most of the other privatisations: it is purely driven by free-market ideology and the express intention of further enriching the private investors and wealthy Tory donors, who are expected to buy into the sale. For the public, it hasn’t led to any improvement in service. In fact, if previous privatisations are any guide, we can look forward to worse service coupled with a vast increase in prices in order to finance grossly inflated pay rises for the board of directors. And, as with all such privatisations, it’s also been grossly undervalued so that the taxpayer has not seen a proper return for the sale.

It is, as Private Eye has said, a rip-off.

It’s also another privatisation that I don’t think anybody wants. I can remember when the Royal Mail’s privatisation was first mooted back in the 1990s. I’m fairly certain my next-door neighbour’s at the time were working class Tories. I can recall them being absolutely horrified by the proposal, and stating very clearly that they did not vote in the election so it could be sold off.

Public opinion, however, means nothing to this government, nor indeed to much of the political class in general. They continue to remain absolutely convinced of the rectitude of free market ideology, despite its manifest failure to provide jobs, improve quality of service, or indeed give cheaper service. Privatisation – not just of the Royal Mail, but also of the rest of the utilities, including and especially the power companies and trains – is a massive, exploitative failure and should be reversed.

Your Unrepresentative Representative: Esther McVie in Wirral West

March 25, 2015

Mike in his series exposing the lies, hypocrisy and sheer malignancy of Tories in marginal constituencies has also turned his attention to Esther McVey. McVey’s views and the policies she embraces are so unpleasant, that she has been dubbed ‘Fester McVile’. It seems, however, that from the number of falsehoods she has spun to justify herself and her continuing punitive attitude towards the poor and less fortunate, that she should equally be called ‘Festering Lie’. And Mike goes on to list the lies she has told.

She said it was impossible to hold a cumulative impact assessment into the effect of government welfare reforms. Untrue.

She also lied, and denied the existence of a loophole in the bedroom tax legislation that meant the government removed housing benefit from people, who were actually exempt. At least one person, Stephanie Bottrill, committed suicide because she feared she could no longer support herself because of the reduction in her benefit. She also denied she knew anything about how many people were affect by the loophole. Mike cites FoI requests that show that at least 16,000 people have been affected.

It was Mark Hoban, rather than Lie, who came out with the next whopper. He claimed that independent reviews of the work capability assessment showed that the government was working to improve it. Studies instead showed that almost 2/3 were either incompletely or inadequately put into practice.

It’s on the subject of foodbanks that she really begins to lie. She claimed that the government’s austerity programme was due to uncontrolled spending under Labour, and not from the greed and venality of out-of-control bankers. She then declared that foodbanks were Labour’s ‘nasty little secret’, until Jim Cunningham set the record straight by pointing out that under Labour they were set up to support asylum seekers awaiting decisions on their cases, and not poor citizens.

She’s repeated the lie that the Coalition came about to solve ‘the mess we’re in’, rather than as the result of a cynical political deal by two parties desperate for power. She claimed that 60,000 people would go to a foodbank in 2014. Jim Murphy pointed out that that was an underestimate. It’s the number of people in Wales, who would be forced to go to them. In 2013-14 the minimum number across Britain was 913,138.

She attacked Labour for allowing five million people to be supported on benefits for being out of work, with two million children living in families without jobs, and claimed that children were three times more likely to be in poverty if they lived in households where the parents were unemployed. Another lie. The Joseph Roundtree Foundation found the number of working households in poverty has risen to 8 million, while unemployed households in poverty is now 6.3 million.

She boasts that the Coalition has got more people into work than ever before, but doesn’t mention that this is nearly all zero-hours, part-time or self-employed contracts that deprive workers of certain basic rights and pay low wages. She claimed that the tax cuts meant families were better off by £700 per year, but in fact low wages and the cost of living means that people or £1,600 worse off.

And when you examine her voting record, it’s pretty much the same tale that emerged with Anne Soubry, Nick de Bois and Kris Hopkins: she supported the cuts to all the welfare benefits, including benefit uprating cap, and legislation making councils responsible for their citizens ability to pay council tax, while depriving them of the funds to do so. She also strongly supported the Bedroom Tax.

She’s against tax increases for the rich, wants to see corporation tax cut, and also supports increasing VAT. She is also in favour of further military action overseas, but against strengthening the military covenant. In education she support the privately run academies and free schools, voted to raise tuition fees, and end state support for 16-19 year olds in education. She also supported the privatisation of the Royal Mail and Britain’s forests, and is against localism and the devolution of further powers to local authorities. She is also in favour of deregulating gambling and allowing rail fares to rise without government restrictions. And she’s also a supporter of the piecemeal privatisation of the NHS.

She was also one of those in favour of the police and crime commissioners, the secret courts, restrictions on legal aid, and the expansion of government surveillance. She doesn’t support equal rights for gays and same-sex marriages. She’s also voted both for and against a referendum on Britain’s EU membership.

Mike’s article begins:

There is little that this blog can add to the litany of outrage against the woman who has been dubbed ‘Fester McVile’ by commentators who are feeling kind towards her.

In a previous column, this blog stated that the employment minister, who works under Iain Duncan Smith, “has accumulated a reputation so bad that the only way she can hide the metaphorical stink from the public is by associating with …Smith himself, in whose stench she seems almost fragrant. But not quite”. How accurate those words are.

This is a woman who has lied to the public that it is impossible to carry out a cumulative assessment of the impact on the sick and disabled of the Coalition’s ‘final solution’ changes to the benefit system.

This is the woman who, in the face of public unrest about the prevalence of zero-hours contracts, announced that Job Centre advisors will now be able to force the unemployed into taking this exploitative work.

She has previously misled Parliament over the loophole in Bedroom Tax legislation that meant the government had removed Housing Benefit from thousands of people who were exempt from the measure – including Stephanie Bottrill, whose suicide has been attributed to the pressure of having to survive on less because of the tax. Asked how many people had been affected by the loophole, McVey played it down by claiming she did not know the answer, while other ministers suggested between 3,000 and 5,000. In fact, from Freedom of Information requests to which just one-third of councils responded, 16,000 cases were revealed. Esther McVey is a very strong supporter of the Bedroom Tax.

Mark Hoban stood in for McVey to trot out the lie that independent reviews of the Work Capability Assessment had identified areas of improvement on which the government was acting. In fact, out of 25 recommendations in the Year One review alone, almost two-thirds were not fully and successfully implemented.

Mike’s article is at http://voxpoliticalonline.com/2015/03/24/will-wirral-west-divest-itself-of-esther-mcvey/

Read it and decide for yourself if this is a woman, who should be anyway near power and public authority.

Kris Hopkins, the ‘Slimy, Nasty’, Unrepresentative Representative for Keighley

March 24, 2015

Mike over at Vox Political continues his exposes of the nastier Tory MPs now occupying marginal constituencies. In his post, Keighley’s chance to end the hypocritical claims of Kris Hopkins, he attacks Kris Hopkins’ lies and hypocrisy, particularly about the current state of housing in Britain. Hopkins is housing minister, and has boasted of the numbers of new homes the Tories have built, without also mentioning that this is the lowest since before the Coalition took power. Mike also notes the way he claimed the government had helped hardworking people, despite the fact that this Christmas, 80,000 children were homeless. His reaction to that was simply to shrug it off, stating that the government had given a billion to local councils to tackle the problem, and he was confident that they had met their statutory obligations. Or some such verbiage.

Mike’s article begins

Even one of his own Tory colleagues has described Kris Hopkins as one of Parliament’s “slimiest, nastiest MPs”, so voters in his marginal Keighley constituency should relish the chance to kick him out in May. Right?
Before becoming the Coalition’s housing minister, Hopkins’ only previous claims to fame were allegations that “gangs of Muslim men were going around raping white kids” (thanks to Johnny Void for that one) and a Twitter spat with the equally-odious Philip Davies.

Hopkins called for Conservatives to unite behind David Cameron in 2013 – to which Nadine Dorries (who was responsible for the “slimiest, nastiest” comment) responded, “pass the sick bag”.

As housing minister, he has claimed that more than a third of a million new homes were built between 2010-13, including 150,000 affordable homes – but neglected to mention that this is the lowest level than in any period prior to the Coalition Government. Vox Political reported it as “not an achievement. It is a disaster”.

“Our policies on housing are working,” said Hopkins in a press release. “Housebuilding is growing at its fastest rate for 10 years, and the tough decisions we’ve taken to tackle the deficit have kept interest rates low and are now delivering real help to hardworking people.”

Oh really? And what was his response to the revelation that 80,000 children were homeless due to Coalition Government policies on Christmas Day, 2013, mere months after he had taken up his post?

He couldn’t care less. “We’ve given councils nearly £1bn to tackle homelessness and to support people affected by the welfare reforms,” he sniffed. “I am very clear that they should be fully able to meet their legal responsibility to house families in suitable accommodation.”

When his voting record is examined, he is a fanatically pro-rich and with same bitter, punitive spitefulness towards the poor and less well off as Nick de Bois and Anne Soubry.

He opposes increased taxation for the rich, including the mansion tax, doesn’t want corporation tax increase, but does support increasing VAT.

He also supports the piecemeal privatisation of the NHS and the bedroom tax. Mike also points out that he is an opponent of localism, and actually voted to reduce funding to local authorities. He also supported cuts to all the welfare benefits, the benefits upratings cap, and like Soubry and de Bois he wanted to make sure councils had the responsibility for making sure their residents could pay the council tax, and reduced the amount of money paid to council to ensure they could.

He is also massively in favour of further privatisation, supporting the privatisation of the Royal Mail, the sale of the forests, and private free schools and academies. He also voted in favour of raising tuition fees and ending financial support to 16 -19 year olds in education.

And like much of his grotty party, he support further military action overseas and nuclear weapons.

He was another supporter of the government’s plan to extend injustice further by restricting legal aid, and setting up secret courts, as well as the snooper’s charter that allows the government and security services to tap our telecommunications without warrant.

And he’s also in favour of the badger cull, unregulated gambling and allowing the rail fares to rise unchecked. Clearly he’s unconcerned about the poor quality of the service on the railways, which came in with privatisation, and couldn’t care two hoots about the dangers of gambling addiction.

Nadine Dorries was right to refer to him as one of the ‘slimiest and nastiest’ politicians.

Mike’s article is at http://voxpoliticalonline.com/2015/03/23/keighleys-chance-to-end-the-hypocritical-claims-of-kris-hopkins/

Read it and make your own decision.

Another Unrepresentative Tory: Enfield’s Nick de Bois

March 23, 2015

NickDeBois

Nick de Bois pretending to care about the closure of Chase Farm’s A&E.

Mike over at Vox Political has started turning his ire on hard-line Tories in marginal constituencies, whose voters may not be quite aware of how exploitative and nasty their candidates’ views and voting records are. He started off with Anne Soubry in Broxtowe in his piece Broxtowe: Do you really want Anna Soubry as your MP? Now he turns his jaundiced gaze to Nick de Bois, the Tory MP for Enfield in Nick de Bois: Enfield’s unrepresentative representative.

He starts by pointing out de Bois’ hypocrisy in his campaigning against the closure of his local hospital’s, Chase Farm’s, A&E department after he voted for the very government measures that have led to its closure. He is also, like 91 other Tory MPs, a senior employee of the private healthcare firms hoping to profit from Cameron’s piecemeal privatisation of the NHS. Mike’s article begins

Here’s a fork-tongued MP who deserves to see voters turn their backs on him: Nick de Bois.

Before becoming an MP, he was the majority shareholder in Rapier Design Group, an events management company heavily involved with the private medical and pharmaceutical industries. As an MP, he strongly supported the privatisation of NHS services that has drained money from the system and imperilled the future of Accident & Emergency services in hospitals across the UK.

That did not stop him from attacking the decision to downgrade Chase Farm Hospital in his own constituency of Enfield North. Describing it as “the wrong decision” he claimed that “Chase Farm needs 24-hour A&E, end of story”. In that case, why did he vote for the very measures that led to it being downgraded?

He took Enfield North in 2010, after the seat had been held for 13 years by Labour’s Joan Ryan with majorities in the thousands. His is just 1,692.

How would residents vote if they knew Mr de Bois’s voting record? Let’s find out.

It’s pretty much to be expected that he is as strongly pro-rich, and has the same contempt and spite towards the poor as Anne Soubry.

He’s against increasing the tax burden on the rich, wants to cut corporation tax, and is favour of increasing VAT. He also supports the privatisation of the NHS, cutting welfare benefit across the board, and capping benefits below the rate of inflation. He also voted in favour of making sure that local councils should ensure people could afford council tax, and then voted to cut that support.

He is like his colleague Soubry in that he support further British military actions overseas and nuclear weapons. Like her, he supports private Free Schools and Academies, and also raising university tuition fees to £9,000, as well as ending financial support to sixth form students.

He’s also against localism, but for police and crime commissioners. And yes, he was in favour of the privatisation of the Royal Mail and Britain’s forests.

As for injustice, he was very strongly for it. That’s injustice, note, not ‘justice’. He doesn’t like the plebs having access to the courts, nor for your right to open, public trial. He voted for the restrictions on legal aid, and for the Coalition’s Kafkaesque secret courts.

Mike’s article is at http://voxpoliticalonline.com/2015/03/22/nick-de-bois-enfields-unrepresentative-representative/. Like Anne Soubry’s constituents, his need to see his voting record, and judge if they want to return him to parliament.

Vox Political Asks the People of Broxtowe If They Really Want Their Tory Candidate

March 21, 2015

Mike over at Vox Political has post this piece, whose very title asks a very, very good question Broxtowe: Do you really want Anna Soubry as your MP?. Soubry is a right-wing, true-blue Tory reactionary, who now occupies the seat. It had been Labour since 1997, and although now Tory, is a marginal.

He points out just how right-wing and nasty her views and voting record are. She has voted for the punitive welfare cuts that have sent hundreds of thousands into poverty, including the bedroom tax. Against this, she supports tax cuts for the rich, and the transfer of the tax burden to the poor through raising VAT. She also supports the privatisation of the NHS, the forests, Royal Mail, and Britain’s schools. She doesn’t, however, seem to believe that further and higher education should be free, as she voted for raising tuition fees and ending the support for ‘A’ level students. She also support further military actions overseas and purchasing Trident. As for justice, she supported the ending of legal aid, secret courts, and the further expansion of the powers of the security services to spy on citizens’ private emails and telephone conversations without warrants. She is also an opponent of devolving further powers to local authorities, as well as a referendum on Britain’s membership of the EU. Given this record, it’s to be expected that she also hates green energy and supports the badger cull.

The article begins

Anna Soubry has been among the more vocal Conservatives in the Coalition government – which is interesting as she represents the extremely marginal seat of Broxtowe.

The seat had been Labour-held since 1997, and it seems likely that the Tory victory here in 2010 was a sign of dissatisfaction with the then-current Labour government, rather than interest in anything the Tories had to offer.

How would residents vote if they knew Ms Soubry’s voting record? Let’s find out.

She is against increasing income tax paid by the extremely rich; against a bankers’ bonus tax; supports cutting Corporation Tax (even though this does not make companies more likely to invest in the UK or its workforce); and supported the increase in VAT. Clearly she believes in taxing the poor to pay for the rich.

She is strongly in favour of the current government’s creeping privatisation of the NHS.

She strongly supported the Bedroom Tax.
She strongly supported cuts to social security benefits including Jobseekers’ Allowance, Employment and Support Allowance, Disability Living Allowance, the Personal Independence Payment and so on.
She strongly supported the benefit uprating cap, ensuring that benefits do not rise in line with prices.
She voted very strongly for making local councils responsible for helping people afford council tax – and for reducing the amount available for such support.

She is thus a typical member of Cameron’s Tories, who believes in grinding the poor into desperate poverty and rolling back the frontiers of the state in order to make life even better and more profitable for the rich.

Mike states that people of Broxtowe need to know this information.
They do. Then they can judge if they really want this woman to represent them.

From 2010: Private Eye on the Failures of Jarvis, Vertex, Liberata and other Private Contractors

April 10, 2014

This is the from the Eye’s issue for 17th -30th September 2010:

Outsourcing

A Private Dysfunction

Government cost-cutting plans to outsource more and more services could herald a series of cock-ups as companies running the services go the same way in tough economic times as PFI and rail maintenance company Jarvis and, last week, housing maintenance company Connaught.

Alongside the usual suspects of Capita, Serco et al, many previously unheard of outsourcers are eying up contracts even though they have limited track records and shaky finances. Several are owned by a private equity industry that sees outsourcing as the next quick buck and are accordingly borrowed up to the eyeballs. Fine if they succeed, quick disaster if they don’t.

One such outsourcer is Vertex, chaired by Sir Peter Gershon. As David Cameron’s productivity adviser before the election, Gershon counselled: “a new government faces a massive and complex agenda of driving savings to close the deficit. It ought to simplify this agenda by deciding that all back office transactional functions will be outsourced within 18 months …” Coincidentally, this will hugely benefit his employer Vertex, which already has “contact Centre” and other service contracts with JobCentre Plus and councils including Westminster and Hertfordshire.

Vertex needs all the business it can get. In the two years ended 31 march 2009 it lost £43m, largely because of £35m in finance costs brought about by the huge debts (£215m in 2009) that come with private equity ownership, and which leave Vertex with liabilities exceeding its assets. Since 2008 Vertex has been owned by a consortium of US private equity firms.

Another firm in even firer financial straits is Liberata, which runs finance, payroll, IT, maintenance and any number of other services for councils from Somerset to Manchester and in Whitehall for the Justice ministry and culture department, among others. it is owned by private equity outfits General Atlantic Partners Ltd and GAP-W International, and groans under liabilities exceeding its assets by £67m and losses in the last two years running to £91m. Most arose on its pension schemes, which by last year had run up a combined deficit of £81m. In September, Liberata brought in a Serco and Crapita veteran, Dermot Joyce, to turn things round.

When Jarvis failed to turn things round and went into administration earlier this year, 1,000 “outsourced” workers lost their jobs and there was no money left for redundancy payments. With public services thrown at the mercy of a volatile private equity market, they might well not be the last.

Several of the care homes, which were in the new a year or so ago for poor care and appalling abuse inflicted to their miserable inmates were similarly owned by private equity firms. These firms regarded them solely as a source of profit, and were not interested in providing good quality care to their disabled and mentally retarded wards. They may also have been in similar perilous financial condition.

As for Gershon’s relationship with David Cameron, this seems to be the norm with Tory party politics and privatisation. The Skwawkbox blogged earlier this week about the connection between George Osborne and one of the companies that made a massive profit from the privatisation of the Royal Mail. It’s time this was all stopped.

From 2011: Government Appoints A4E to Design Contracts for Private Welfare Schemes

April 8, 2014

This is another story from Private Eye, this time from 2011. According to the Eye for 30th September – 13th October 2011, the government was awarding A4E the contract for designing the rules under which A4E, amongst other contractors, would bid to provide public welfare and social services.

Welfare Reform

Contract Claws

The Cabinet Office has appointed A4E, one of the government’s biggest contractors, to design the kind of contracts for which it will itself bid.

A4E will design the “payments by results” rules for the welfare contracts funded by “social impact bonds”, the government’s new big idea for public services. By putting its main welfare contractor in charge of designing welfare contracts, the department is effectively repeating one of the central failure of the private finance initiative.

The contract is worth up to £300,000 and covers pilot schemes in four regions to help families with multiple problems. Private investors fund welfare and social work schemes and the government then pays the investors back over years based on the public money “saved” by unemployed people finding work or ex-offenders staying out of jail.

The Cabinet Office is seeking “more innovative financiers, with a bigger appetite for risk”, so it will take very tight contracts to prevent these aggressive investors getting big returns over long periods for ill-defined “savings”, as the PFI example shows. Asking A4E to guarantee the “robustness of the savings estimates” seems perverse as the firm has repeatedly failed to give good results on its existing welfare-to-work contracts (Eyes passim), and it has every interest in government contracts being as soft as possible.

A4E may be excluded from bidding for the contracts it is drawing up in Birmingham, Leicestershire, Hammersmith and Westminster (all Conservative councils); but exclusion is not automatic; A4E is being asked to guard against “cream skimming/cherry picking” and ensure “value for money” – but critics say that A4E is itself guilty of the former and does not offer the latter.

Such conflicts of interest and soft corruption are, of course, no strangers to welfare reform and the public-private contracts governments since Maggie Thatcher’s have pursued. The Skwawkbox today blogged on the close links between George Osborne and the company, which bought up many of the Royal Mail shares at a discount. Way back in the 1990s, one of big accountancy firms being employed by Major’s government to adjudicate the bids of companies competing for a government contract, then decided to bid themselves as they decided they were the best candidate. A4E in this instance is merely part of a long line of such cases. It was all part of the ‘sleaze’ of the Major years, of which a French politician said ‘You call it ‘sleaze’. In France we simply call it corruption.’ The point of such contracts in any case isn’t to guarantee quality of service, or provide transparency and accountability, but simply to award lucrative government money to big companies that will then reward the politicians concerned with directorships.

The Thurrock Heckler on Zero Hours Contracts

July 28, 2013

I found an excellent post on the insecurity, poverty and fear generated by zero hours contracts over at the blog The Thurrock Heckler. It begins

According to the Office for National Statistics, the number of workers on zero hours contracts doubled during the last year to 200,000. A zero hours contract is a way that legally allows employers to take on staff without any guarantee of actual work or income. In 2005, there were 55,000 workers on zero hours contracts. This rose to 110,000 between April and June last year. That nearly doubled to 200,000 between October and December last year. As it is now April and the trend appears to be going upwards, it would be a reasonably safe bet to assume that there are way more than 200,000 on these contracts. Over a quarter of major employers in Britain now use zero hours contracts. We need to do a bit of digging around to see how many small to medium companies also use these contracts as the figure of 200,000 seems very much on the low side to us.

This is all part of the ‘flexible’ labour force that is heralded as keeping unemployment numbers lower than they would be in the depths of an economic crisis. Supporters of zero hours contracts claim they allow employers greater flexibility in planning their workflow as they can use and discard staff as demand rises and falls. Sure it’s great for employers but it’s utter crap for workers who have no choice but to accept a zero hours contract or have no work at all.

I’ve friends, who were placed on zero hours contracts, and all of this is true. The article does not mention the problems they had with their local jobcentre. They tried claiming benefits for the period they were not working. The DWP demands that you provide a payslip indicating that that week you were not paid. At the time, however, they were working for the Post Office, who only gave you a payslip for the days you worked. My friend was thus placed in the position where he was unable to claim unemployment benefit, because of the payroll system used by the Post Office. I’m sure he wasn’t the only person in this position, or that it was confined to the Royal Mail.

Zero Hours Contracts are a nasty way of providing employers with a cheap labour force, in which those on the contracts are trapped going from one day to another. It’s the return of casual labour of a type that the Labour party made illegal earlier in the century for dockworkers. Now it’s come back, and is being used in wider industry. I’ve also no doubt that the Heckler is right when he says that if Labour comes to power, they will be under increasing pressure to maintain or expand Zero Hours Contracts in order to increase competitiveness.

The articles at http://thurrockheckler.wordpress.com/2013/04/05/zero-hours-contracts-total-insecurity/. It needs to be read.

The Post Office, Privatisation and Valueless ‘Work-shares’

July 13, 2013

This is a story that I will need to check, but if it’s true, then the Post Office has committed what would once have been a violation of the Truck Acts, and committed something that could reasonably be construed as fraud.

‘Work Shares’, Local Currency Schemes and 19th century Anarchism

The government this week announced it was moving ahead with its plans to privatise the Post Office. This is scheduled for the autumn. There is going to be major restructuring, but it has stated that its workers will be given shares as part of the privatisation deal. I know a number of people, who work for the Mail that are naturally worried about whether they will still have a job in a few month’s time. A friend yesterday told me, while we were discussing this, ‘At least this time they’ll have real shares’. I queried what they meant by this, and my friend further explained that a little while ago the Mail told its workers that it was now going to pay for their overtime in that period in ‘work shares’. My friend said this wasn’t the correct term, which he couldn’t remember at that moment. The name my friend gave to it suggests that it may have been similar to some of the local currency schemes operating in some parts of the UK. These schemes give you a number of coupons or token for hours worked in particular community projects, which can be exchanged for goods and services, which have involved the same amount of hours worked. It’s an idea that ultimately seems to come from 19th century Anarchism, particularly Proudhon’s Mutualism and Anarcho-Individualism. One of the great American Anarchists of the 19th century used to operate what he called a ‘Time Store’. He used to time how long it took to serve a customer. The actual monetary cost of his wares were low, very close to cost price. However, he would also charge his customers payment in kind equivalent to the time he had taken to serve them. It was a commercially successful system.

It also inspired the classic SF short story, And Then There Were None, in which a party of imperialist Earthmen gradually succumb to the superior social and political system of just such an Anarchist Utopia. The planet they attempt to conquer has just such a libertarian economic and political system. Intrusive questions and attempts to bully the self-reliant farmers, businessmen and workers of the world into giving vital information is simply answered with the word ‘NYOB’: None Of Your Business. The local currency schemes, which such libertarian ideas have inspired, have done a lot of stimulate local economies, as people patronise their local businesses using these currencies. Or they did until Gordon Brown started looking for more things he could tax, and declared that these schemes were also subject to VAT. Unfortunately, according to my friend the Mail used an accounting trick to declare that these ‘work shares’ were valueless, took them back off their workers, and destroyed them.

The result of this is that the Post Office workers were effectively not paid for the overtime they worked.

The Truck System

Now as I said, I don’t know if this is true. If it is, then at one time it would have been a violation of the Truck Acts.

Robson Green gave a succinct summary of the ‘Truck System’ in his TV show, Building the North, on ITV on Wednesday, although he did not call it by name. He remarked how 19th century factory masters had nearly absolute control of their workers’ lives. They were frequently paid in tokens, which could only be used in the company shops. Although he didn’t call it by name, this was the notorious Truck System. It was abolished in the 19th century by the Liberal government, which freed their workers from such commercial exploitation from their employers. I’ve got a feeling that free trade commercial ideology may also have played a part. If the workers’ were free to spend their money how they chose, then not only would this allow them greater choice, it would also encourage greater competition and commercial opportunities as other companies and shops would be free to supply them with whatever they wanted or needed.

Truck Acts Repealed in Favour of Electronic Payment

Unfortunately, the Truck Acts were repealed in the 1980s when the direct payment of wages and salaries into employees’ bank accounts was introduced. My point here is not to criticise that system of payment, but simply to show that it appears to have had the unfortunate consequences of opening the system of payments back up to such morally and commercially dubious arrangements as the ‘work shares’. It looks like something close to the Truck System was being operated by the Mail with these spurious shares. It does not augur well for employee confidence in their promises to provide them with shares as part of the privatisation package.

Unpopularity of Post Office Privatisation

I also have to say that I don’t know anyone personally who has been in favour of the privatisation of the Royal Mail. My next door neighbours were working class Conservatives. They objected to the idea, when it was mooted by Blair’s administration. I don’t think ordinary people like them will be impressed whatever the type of government that introduces it. The same friend, who mentioned the ‘work share’ system also told me that the dangers of privatising this service could be seen in the way the Americans had never privatised it. America has always strongly supported capitalism and free enterprise, at least to a greater extent than the European nations. If the Americans found that privatising the Post Office was unworkable, then it showed that it was really unworkable.