WTNML – Trade Unions and the new economy

January 9, 2012 6:12 pm

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Ask most politicos what the most defining idea of Ed Miliband’s leadership is to date, and most will undoubtedly refer to the “squeezed middle”.

Ignored at first, mocked later, and now embraced, the concept exposes one of the government’s weak spots, and has the potential to fit perfectly into the new consensus which has developed at the top of all the main political parties – the belief that the current and upcoming political scenery will be one defined by fiscal constraint. Whatever the merits of that consensus – and lets not forget there are arguments on either side – it is becoming increasingly clear that Labour members need to start thinking about how social justice can be delivered “when there’s no money left”. No easy task for a party whose political strategy in government largely rested on investment and redistribution via state spending.

But like I said, this concept only has potential so far. Beyond the broad critiques of modern capitalism that we heard in Ed’s conference speech, there is little detail on how a future Labour government would amend the poor performance of wage growth for the vast majority of British workers. If the squeezed middle critique is to be translated in to a successful policy, we need solutions.

The tale of the squeeze is becoming a familiar one. Since 2003 11 million workers have seen no increase in their wages. If we look at the last 30 years, the share of GDP going to the wages of the bottom 50% of earners has decreased by more than 25%! This same period saw an aggregate 2% increase in the share of national income held by the wealthiest 10%.

Besides the macroeconomic shift from the Keynesian post-war settlement to the Neo-liberal consensus of Regan and Thatcher, that period has seen another shift – a dramatic fall in the number of people who are members of trade unions. Over this period we saw a drop in trade union membership from around half of the working population, to barely over a quarter. There is a clear correlation between the fall in trade union membership and the falling share of output which goes to the wage packets of low to middle income earners.

If you look at the rich nations which consistently top the league tables for economic equality, high levels of unionisation amongst the workforce is a common feature (Sweden – 68%, Norway – 54%, Denmark – 66%, Finland – 69%). This isn’t surprising. In a capitalist economy where large sections of the private sector have geared themselves towards the bottom line of profit maximisation and shareholder value, the downward pressures on wages are ever present. Trade unions are the natural countervailing force to that.

The percentage of a workforce that are members of a trade union is important, but more important is the ability of that union to actively pursue its member’s interests. As any trade union official knows full well, employers only take note if there is a reasonable threat of effective action from a disillusioned workforce denied their due desert. As such trade unions fulfil a vital democratic function within the market economy, which left to its own means, overwhelmingly favours those with economic power. The problem for all those low to middle income earners over the last 30 years is not just the fall in the level of trade union membership, but that simultaneously the trade unions have been systematically undermined in their efforts to secure rising living standards by legislation which was, and still is, offensive to the most basic concepts of democratic civil society.

In the 80’s whilst the Tories were introducing the most draconian changes to trade union law in nearly a century, a young barrister named Anthony Blair aptly noted that;

This renewal of the Tory attack on unions brings into sharp focus the increasing unfairness of union law in Britain.”

He was right, but sadly upon reaching government some years later he did little to reverse the fundamental alterations to union law which formed the core tenets of Thatcherism. If we are to deliver economic justice for the squeezed middle, then strong, effective trade unions have a vital role to play.

I know what many will say. This isn’t a policy that will help build the new, more equitable economic model that we need, but an attempt to return the economy to the strife of industrial conflict seen in decades past. And on the surface that would probably be a fair criticism. Stronger trade unions will be vital in building a more balanced settlement between labour and capital, but alone it will be ineffective in creating successful long term reform. Because we don’t just need space in which unions can organise more effectively, we need a renewed focus on a sustainable distribution of rewards from both unions and business which in the long run will be in the best interests of both.

That relationship will be one where both sides recognise that a more equal distribution of rewards can be achieved by business models which value more than the bottom line. Business models which demonstrate a narrower gap between top and bottom can increase the productivity of a workforce which not only feels more valued, but feels engaged in the decisions surrounding the distribution of the fruits of their labour.

There are elements of the business community that will resist such the shift to the kind of economy Ed Miliband has spoken of (some already acknowledge its inevitability), and that is something a government can not easily solve with legislation. But it is something that governments can enable the workforce to set in motion. Because along with the development of new institutions that aim for a more long term, equitable economic settlement, business will need to feel the pressure of a well organised workforce, backed up by threat of effective action, to start to embrace the new economic model. In that sense the new economy will be built by employees, as well as by government and businesses.

Throughout our history reform has always been preceded by a build up of disillusionment with the status quo, and a perceived threat of unrest from dominant interests (think Corn Laws, broadening the franchise etc). The only alternative to the shift is business as usual. The continuance of the status quo, where rewards remain distorted and employers remain dominant with no incentive to consider the needs of a workforce that has no effective power to help shape the change we need.

If the next Labour government wants to solve these problems without centralised, command and control economics, then reforming employment legislation so that it reflects a more balanced relationship between labour and capital will have an important part to play.

For example, employers must be stopped from using the courts to overturn the democratic decisions of trade unionists on spurious grounds such as minor errors in the reporting of ballot results. We need new rules which prevent employers from circumventing recognition procedures by recognising non independent unions with managerial support. And we need a fresh approach to collective bargaining that broadens the scope for bargaining outside of the narrow focus on wages.

There are many more aspects of trade union legislation that could be altered to encourage a more balanced approach between economic interests. A Labour government committed to such aims should establish a Royal commission, setting its remit in line with the principles discussed here, and a view to ensuring British law is in line with conventions of the ILO and European social charter. Many recommendations already exist, not least the brilliant work done by John Hendy QC, but a commitment to the properly defined remit of a commission would allow an array of experts and stakeholders to develop detailed proposals that will suit the new economic agenda.

But trade unions must use the resulting freedoms to organise towards a more reciprocal relationship with business, so that we may deliver for the squeezed middle, but also so we can begin to build the good economy. Business and trade unions can maintain an adversarial relationship, or they can develop a partnership for shared prosperity. Such change will, as Ed Miliband has said, challenge powerful vested interests. Levelling the playing field in the power structure between the two is essential to ensure that quest is successful and best of all it is a policy which will require no substantial spending commitment whatsoever.

Got an idea for what Labour should stand for “When there’s no money left?” – email us. We’ll be conducting a poll of the best entries, and the winner will present their idea to a “Dragon’s Den” at the Fabian New Year conference.

  • Anonymous

    I agree.  The decline of private sector pensions is a good example of what happens when workers are not in trade unions.

    • jaime taurosangastre candelas

      @ RobertCP,

      what is to stop anyone from maintaining their own pension, rather than relying on an employer to do so?  I think that many people will work for many employers in their working lives, and many have no company schemes at all.  My father-in-law is a farmer and has always had to have his own pension plan.  I work for the NHS and of course there is a pension scheme, but I do not trust it to ever pay out to me in 25 years when I retire, so I have my own pension plans.  My wife has worked for 4 employers since she qualified, is now a partner in her practice, but still maintains her own scheme.  It would be stupid not to do so.

      Joining a union with all of the loss of freedom that means is a poor reason to secure a good pension.  People should look after their own needs.

      • http://www.facebook.com/people/Mike-Homfray/510980099 Mike Homfray

        Hilarious. Exactly how do you propose a routine worker ‘looks after their own needs’ against an employer who has got it in for you? A decent workplace pension is likely to be far better than a private sector one for a low paid worker. Not a comfortably off salary earner like yourself.

        Joining a union is central to what the Labour party is all about, Jaime. Still, no surprise that its yet another thing you don’t like about us….

        • jaime taurosangastre candelas

          Mike,

          “needs” refers to a pension plan, not treatment in the workplace.

          A “routine worker” looks after his or her needs by planning for the future.  It is predictable that we all get older and at some point most people retire.  So people should make their own plans.  If you want to retire at 55 with a large pension, you should pay more money into a fund than if you want to retire at 65 with a medium pension, or at 70 with a lower pension.  Life is about choices and personal responsibility.

          I don’t rely on any union.  I negotiate my own salary, and more importantly some freedoms that are important to me.  My contract of employment looks nothing like a standard contract that the BMA believe is fair to both sides.  Their version may well be fair, but my version works for me and my employer.  For example, I trade some salary for a guaranteed paid week on top of annual holiday when I can go on a retreat at Easter.  My salary is not set by collective bargaining:  my price for working for my employer is discussed between them and me, and if either side does not like the deal, it does not happen.  They are free to find another EM Consultant, I am free to work for another organisation.  I have stipulated that I want 6 month’s of notice, because that suits me and I don’t expect to want to change jobs in less than 6 months.  They were free to reject that, but were happy to sign the contract.  I have also negotiated some technical matters about responsibility and control of my department and budget which again the employer finds acceptable.  

          • derek

            “Needs”  it’s a pretty basic “need” to protect your employees and all though all caution and diligent care is adhered to, even Doctors can become victims of contracted disease through work and lets not forget miners and 
            Silicosis or Asbestos working related contact.

          • http://www.facebook.com/profile.php?id=715486331 Alex Otley

            I think the trouble is Jaime is taking his exceptional case and assuming it would apply to everybody else. Most workers live in a totaly different world, and where family budgets are more marginal they need to get the best contracted pay possible. That can only come through collective bargaining – if everybody is left to negotiate on their own it quickly becomes a race to the bottom, as some people are prepared to accept less to get the job.

            You’re also right to point out health & safety – without unions there would be massive setbacks.

            Sadly I don’t think that Jaime appreciates this. Just because in his rarified world he is in a situation where he doesn’t need the support of collective bargaining doesn’t mean he can apply that to everybody else.

          • GuyM

            Simply a situation that has no relevance to the private sector at all.

            It completely negates performance related pay and individual appraisals and is more akin to some sort of horrible battery farm type existence where the poor downtrodden work er needs help.

            In 15 years across over 10 private sector vertical markets and some of the biggest private sector companies I’ve never had even a sniff of Union activity (apart from a NUJ poster at a publishing firm – but no members).

            Union are an irrelevance to 95% plus of private sector workers.

          • http://www.facebook.com/people/Mike-Homfray/510980099 Mike Homfray

            And you think a routine office worker could beheve in this way? You simply haven’t a clue. You occupy a rarified element of the work environment not open to the vast majority.

          • GuyM

            I manage a load of “routine office workers”, they all negotiated their contract and salary rates and they all work on the basis of annual appraisals and have differing pay awards within the general pay envelope available.

            That applies to recent graduate through to departmental managers.

            If you asked them not one would give up that freedom for a collective bargain.

            Do tell me what actually is your private sector corporate experience Mike?

          • Anonymous

            Guy, does your company offer your employees a decent final salary or even average salary pension scheme?  I suspect that like most non-unionised workplaces your company does not contribute to your employees’ pensions.

            Most intelligent managers realise that trade union representative are actually helpful.   They have the common sense to see that discussing an issue with an intelligent and reasonable representative can help to resolve problems with their workforce.   That is why sensible employers offer facilities time to trade union representatives.

          • GuyM

            You really do need to do your research, every single company I’ve worked at contributed to their employees pensions.

            However a pension scheme is only one of the things thsat fall under “package” and how attractive it is.

            Hours, holidays, flexible working, health insurance, pension, life insurance, critical illness insurance, company car scheme, travel loan…. etc. etc.

            Personally a pension scheme is not so important to me that I’d boost it over say private medical insurance.

            I also dispute that Union representatives are “intelligent and reasonable”… just how many Union reps and shop stewards have degrees?

            But anyway, never seen  one and the private sector has no interest in them as shown by there being no presence in offices across the country.

          • http://www.facebook.com/profile.php?id=715486331 Alex Otley

            You’d favour private medical insurance over a pension?! I genuinely don’t understand that, and I think the great majority of people would agree with me.

          • Anonymous

            Thanks for the reply.  It is good to know that your companies contribute to pensions, although it is getting more difficult for private companies to offer a good pension to their employees. 

            It is a free country, so people can choose whether to join a trade union.  However, your staff might hesitate to show an interest an interest in trade unions in case they get sacked!
             

          • Hugh

            ” If you want to retire at 55 with a large pension, you should pay more
            money into a fund than if you want to retire at 65 with a medium
            pension, or at 70 with a lower pension.  Life is about choices and
            personal responsibility.”

            With respect, the chances for anyone on an average salary to save enough for even an adequate pension are pretty limited. The chances for many workers to negotiate their own terms to any great extent are fairly limited too- as evidenced by the fact that wages outside the top 10 per cent in the private sector have barely increased in real terms in the last 40 years if memory serves.

        • GuyM

          and yet the vast majority in the private sector have no interest in joining….

          I turned down a job at interview due to union involvement, in my early career.

          I’d not have joined one then to have thick shop stewards telling me how to think, nor would I negotiate with one now I’m in management.

          Collective pay deals? Yuck.

          • http://twitter.com/gonzozzz dave stone

            “I’d not have joined one then to have thick shop stewards telling me how to think”

            But you’re not doing too well in the thinking department – your previously declared sociopathic lust for societal disintegration via class warfare suggests that you need all the help you can get.

          • Anonymous

            never mind Bach! you will get over it.

          • GuyM

            “sociopathic lusts for societal disintigration”….. oooo a STRAWMAN.

            you know my views, I simply feel no moral obligation, no shared interest and no common cause with the working classes.

            given that they invariably vote to take more taxes from me for their own personal gain I’m pretty hostile to their views, interests and values

            or are you saying I just have to accept them for what they are and keep quiet?

          • derek

            Easy on the shop stupid role, salt of the earth those people.

            In the old days when homes were built in the traditional manner, all trade men carried union cards, it was almost likened to the trade passport.

          • Anonymous

            UCATT other wise you did not get a job.

          • derek

            Up here in Scotland it was the “red hand” or the “Blessing symbol” LoL

          • Anonymous

            I enjoyed my years in Scotland working in Falkirk and Dundee, did not have one strike, came  back to work at Heathrow was told to strike within a month.

          • jaime taurosangastre candelas

            “shop stupid”?  Is that a Blackbusters type of typo, or are you being unusually literal?  ;)

          • derek

            Just reply to the question down below! please! 

          • http://www.facebook.com/profile.php?id=715486331 Alex Otley

            So if your workforce opted for union recognition, you’d resist it to the bitter end? People have a right to join a trade union and you’d be foolish to refuse to engage with them in that hypothetical situation.

          • GuyM

            I’d continue dealing with mystaff one to one, setting individual targets and giving out individual appraisals and pay rises.

            I would under no circumstances agree to collective pay deals, nor would I negotiate with a Union rep’ over pay under any circumstances. In fact I suspect I’d refuse to even meet a Union rep’, which kills their worth if managment refuse to even talk to them.

            Take out pay and what is there left to discuss?

            I’m off the belief that as I pay well, ensure there is no sexism in the pay rates and have a good working environment that I can always get more staff if I need to. Hence firing anyone striking or getting bolshie and recruiting is the easiest option.

            But then in 15 years I’ve yet to meet a single person in the private sector who has been a Union member or wanted to be one, especially at the levels of staff I now manage.

          • Redshift

            Erm, if 50% of staff join the union, you are obliged to recognise them legally. 

          • http://www.facebook.com/profile.php?id=715486331 Alex Otley

            He’d never get 50% union membership because he’d fire anybody involved. The law doesn’t apply to him.

          • GuyM

            Anyone with under 2 years service can be asked to leave.

            But it’s irrelevant, private sector workers don’t want, need or appreciate Unions, so the chances of me ever having any dealings with one is pretty much zero.

          • derek

            Well, if you have an employee who has 23 months employment, never had a day off sick, works well above the average requirement. Then I’d ask a reasonable question, why do you want to sack him?

          • GuyM

            I wouldn’t… but then I also know he’d not be a Union member either as in 15 years I’ve never met one or worked with one.

            So this whole thing is irrelevant, as are Unions in the private sector.

          • http://www.facebook.com/people/Mike-Homfray/510980099 Mike Homfray

            sums up why I wouldn’t work in the private sector

          • GuyM

            That rather reassures me in a odd sort of way.

          • GuyM

            And where in the private sector is there 50% union membership in an office based workforce?

            Never seen it ever and never will hopefully.

            Even if it happened, firstly I’d likely change jobs rather than work with a Union and secondly I’d continue with individual pay deals and ignore any collective bargaining requests.

            You can recognise and still ignore.

          • http://www.facebook.com/profile.php?id=715486331 Alex Otley

            I love this. First you’d refuse to recognise them. Now you’ve realised that you’d have to recognise them but would just refuse to negotiate. Despite that you’d still quit your job in protest at their existence. My question is is that a threat or a promise? My guess is if a majority of your workforce were unionised and you quit in protest they’d probably throw a party.

          • GuyM

            Refuse to recognise and ignore are the same thing to me. Not comment on, not recognise, not talk to, not meet with, not have anything to do with at all.

            If forced into a position where my company decided to work with Unions, I’d simply get a new job somewhere else and let them recruit a replacement.

            I’m used to changing jobs at elast every two years, faster in consultancy work which is project based. The idea of staynig in one company for 15 to 20 years is not attractive.

            But once again I draw you to the fact that in 15 years in the private sector I’ve never seen a single Union member, never had any Union rep approach me and never had an employer who worked with a Union.

            They are irrelevant for all intents and purposes, with what little presence they do have largely in the lower skilled manual type jobs.

          • http://www.facebook.com/profile.php?id=715486331 Alex Otley

            “Hence firing anyone striking or getting bolshie and recruiting is the easiest option.”

            An interesting admission. You’re lucky you don’t work in a unionised workplace, because with that attitude you’d find yourself in a tribunal pretty damn fast.

          • GuyM

            You mean I’m lucky I work in the private sector?

            Yes I’d agree with that.

          • Redshift

            You think your shop steward is thick? Elect a different one…

            I think this kind of goes over your head a little Guy

          • GuyM

            Why would I be in the slightest bit interested in electing anyone if I  (liek the vast majority of private sector workers) don’t even feel the need to be represented by a Union?

            I have never had any desire to be in a Union, be represented by a Uni0n, be included in any Union negotiations or have to work with a Union.

          • http://www.facebook.com/people/Mike-Homfray/510980099 Mike Homfray

            Exactly how I feel about working in the private sector

          • GuyM

            Which is of course why we “aren’t in it all together” and why there is animosity between private and public sectors.

            In the past I’ve always told recruiters I’d never work in the public sector nor want to “serve the public”.

            I simply detest the ethos, workpractices and political ideology of the public sector.

          • derek

            So I come to your door for a job, I’ve an extensive background in MRP 1  and MRP 11  I lay a fully loaded CV on your desk, and you hit me with that above outburst, Feck, the man’s a political animal I say quietly, Jeez! lets have a recess as I slip out the front door.

        • Anonymous

          Sadly people see Unions now as political not work related.

          • Anonymous

            Including many of the union staff themselves.

      • derek

        To be fair Jaime, I think your talking more about a personal saving plan rather than a pension plan? someone who earns say 12,00 per ann and put’s 10% into a savings plan for retirement if their lucky, will only accrue 1,200 per ann, so if they accrued 40 years service under a personal savings plan they’d accrue 48 thousand final pension savings, which if they did life another 40 years would be 1,200 pounds per years or just over 23 pounds per week.

        • jaime taurosangastre candelas

          Derek,  a personal pension plan is nothing but a savings account managed by either civil servants or bankers, neither of which I would trust with my future, nor do I care for their annual management charges or stupid excuses for losing your money.

          You have not applied interest or capital appreciation to those sums.  If I was offered that investment on the terms you set out I would run away.  Gold and land appreciate annually.  Both are legally tax free if you choose to let the HMRC know about them, and gold is both portable and convertible into any fiat money of your choice.  Other portable investments include platinum and rhodium, both of limited supply and increasing usage in an industrial world.  If you believe in paper investments, Australian water companies and mobile phone companies in Africa have outperformed the market for the last 6 years (by 120% in the case of Australian water).  Argentinian fishing licences in the south Atlantic have done very well for the last 8 years, although I think the end of the market is in sight.  My shares in a Canadian imaging sensor company have also done very well with the growth in MRI scanners.  I have high hopes for a little money I put into a Philipines-based live teleconferencing and translation company looking at the China-US business world, and to date there is a 16% return on 9 months.

          None of that is difficult for anyone to work out for themselves or to manage.  Why people put their faith and their futures in centrally managed schemes, and run for someone else’s benefit is beyond me.

          • derek

            Jaime but at the lower end of investing the person who can luckily afford to invest 1,200 per year in gold can only expect that to increase some 6% adding a further 66 quid per ann or a further £1.29 pence per week, hardly ground breaking increase. I guess if you have a 30% disposable income  of some 30 to 20 thou range, then investing could be very rewarding. There is a difficulty scale, it’s based on what you can afford

          • jaime taurosangastre candelas

            No Derek, I completely disagree.  Yes, I now have some scale to investing, but it was not always the case.  In 1995 for example I earned £5,600 a year when I worked in Serbia, and still managed to invest (I was unsophisticated in those days – it all went into gold).

            6% a year is more than you will get from most banks, and I would say that 6% a year is a frugal target.  10-12% a year is what I aim for, and all but one year since I qualified in 1989 I have exceeded that.

            There’s something magical about compound interest.  The maths is easy, but reinvesting the return is as my daughter says a “power-up”.  She’s doubled her birthday money in less than a year when she talked me into 4 months of some rhodium sponge (she bought 1/20th of an ounce from me) and then a sale and a small stake in my share of a south Atlantic fishing licence.  She’s terrifyingly focussed for a 12 year old, even though she doesn’t yet value diversification.  She just likes the fact that her birthday money has grown from £50 to £110 in 8 months.  I’m very encouraged that she doesn’t want to cash out and spend the money on some clothes or computer games.

          • derek

            Jaime, kudos to your Daughter but all in all it’s still kids money in terms of living? Serbia, Wow but look your living expenses would have been zero? Yes food and bed looked after, it’s a pretty big chunk in the UK, the cost of living alone. So we’re no further on for the low wage earners who can only manage 1,200 per year, so lets get smartish? to a point say’s the low earner, F… it, i’ll put the 1.200 on trap two, whey hey at ten to one I’ve doubled my money, I’ll drive around a bit looking  4some liquidated building firm, I’ll buy their copper piping for 12,000, knowing it’s worth double and a half and sell it on to double up again, Jeez! I’m now looking at 24,000 thou, Feck, it’s easy, just the screw all and it’s quids in, I’ll but a little piece of land, knowing full well that some infrastructure is heading that way, low and behold I’ll make another killing, as I demand an extra large sum to sell the land on for that capital project, divs, spivs,,,,short selling, double selling, ….F… them all I’ll triple sell and if your in trouble I’ll do you first and so on. Wonderful capitalism? aint it?

          • derek

            Opp’s Should have said my trap two plan has increased my money by ten times?

          • jaime taurosangastre candelas

            LoL Derek, you’d have fooled a 90s bank manager with your business plan!  You missed a trick of converting your land into a PFI deal, with would have made you really rich.

            The problem I have with my daughter is that she’s only seeing the upside of some investment decisions I took.  She needs to be introduced to the reality of taking a few financial knocks, but it’s really quite hard to even consider deliberately mis-selling your own daughter an investment that you know is not going to work out.  I’m not even that comfortable with her enthusiasm.  It took me until I was 25 to work out that no one on God’s planet had my own welfare at heart apart from myself and my parents, so I’d better look after myself.  The Good Lord introduced me to a marvellous lady who is now my wife who has a similar attitude, but with more compassion than me.  It’s a good thing that my daughter can learn about investing, or even basic mathematics from me, but it’s not going to be a good thing if she launches into her own life when she’s 18 with a business plan.

            She has however said that she wants to pay her own way through University and on current performance, she probably will.

          • derek
          • jaime taurosangastre candelas

            Yes, there are dozens of similar reports and analyses.  Very few look back more than 10 years.  

            I’ve never sold any gold, but I do vary investment decisions and percentages year by year. Should gold decline, I’ll probably not buy during the year any in favour of other investments, but maybe take profit at the end of the year and in the absence of anything better, buy some gold at year end.  I didn’t buy much silver this year as I thought it was overblown in 2010, and I’m glad that I was right.  Of course, it’s all a gamble, but it is one I am in control of, not some city spiv.  

          • Anonymous

            Jaime, this is all very interesting, but do you realise that the NHS would contribute to your NHS pension scheme?  You are turning down money from your employer!

          • GuyM

            I’d not put your faith in things like copper too much in the coming few years, the copper price hike was all down to supply lagging behind demand due to mine shafts etc. being mothballed.

            Rio Tinto and others are now opening up new capacity which should see copper per tonne prices dropping in the medium term, especailly if demand doesn’t increase with economic problems.

  • Anonymous

    Got an idea for what Labour should stand for “When there’s no money left?”The obvious answer should be “find more money”.We should introduce performance related bonuses for HMRC staff – give the tax inspectors 30% of any unpaid tax they manage to recover and offer whistle-blowers from the private sector the same deal. If you work for a company that is avoiding tax (or a company that helps others avoid tax) and you bring that information to the government/public, you should get 30% of the unpaid tax that gets recovered.

    • GuyM

      Tax “avoidance” is legal and not a penny of it needs paying back.

      Tax “evasion” is what you are thinking of.

      • Redshift

        The issues involving the likes of Vodaphone and Goldman Sachs are tax avoidance and whilst legal, it is only that because government lets them get away with it and makes cushty deals.

        • Anonymous

          Yes HMRC under Labour were amazingly lax…

      • Anonymous

        Tax “compliance” is legal.

        The difference between avoidance and evasion is the quality of your lawyers and accountants.

        • GuyM

          Tax avoidance includes ISAs, Pensions, Expenses for freelancers and so on, as well as the sort of accountant led schemes.

          Avoidance is perfectly legal and infact avoidance is catered for in HMRC advice and guidance.

          Anyone running a business or working for themselves treats minimising ones tax bill as standard business practice, as does HMRC. The left really need to get a dollop of real world experience when it comes to tax returns.

          • Paul Lynch

            Surely then there could be an argument for complete reform of the tax system (ie burning every single piece of tax law, starting again)
            I know this idea might not be the most comfortable, but should we have the tax system we on the left want in our hearts, or the tax system that we know we need in our heads?

          • http://www.facebook.com/people/Mike-Homfray/510980099 Mike Homfray

            Then there needs to be lenty of clamping down and rewriting of the ruules, particularly relating to large corporations

          • GuyM

            Go for it and see how far you get.

            There always is this bullshit on the left about avoidance, when the biggest avoidance is VAT fraud through cash payments to tradespeople and the black market.

            If you really seriously think you can do much then have fun.

            I’ll keep offsetting any and all expenses I can when I’m freelancing, irrespective of whether I need to or not. The idea of paying HMRC a penny more than I need to fills me with nausea

  • Anonymous

    I would consider joining a Trade Union a mark of failure on my account.   It’s for those who cannot progress in their careers under their own initiative.

    • Anonymous

      Joe, do you have a final salary or average salary pension scheme at your workplace?  Does your employer contribute to your pension?  Were you one of the people that was whining about gold plated pensions in the pubic sector last year?  I suspect that the answers are no, no, yes.

      Incidentally, joining a trade union has nothing whatsoever to do with progressing in your career.  Trade unions negotiate for their members on pay, conditions of service and pensions.  They are nearly always better where there is trade union membership, including the 15% approx of private sector workers that are in a trade union.  Obviously, people that progress will be paid more in a unionised workplace whether they are in a trade union or not.

        

      • GuyM

        I doubt a Union will ever get me a better pay deal than I can negotiate on my own behalf.

        Every member of staff I’ve managed in the last 10 years has had individual targets and pay deals, no one wants to give that up for collective bargaining.

        • http://www.facebook.com/profile.php?id=715486331 Alex Otley

          With respect, your line of work is the exception here. Most people are not in management consultancy or working in your office.

          You present your experience as typical of the private sector. At your level, I’m sure you’re right. But most people who work in the private sector are much lower down the ladder. Do you think a Tesco shop assistant has the clout to negotiate their own private medical insurance?

        • Anonymous

          I am also sure that you are right about your pay but individual targets are compatible with collective bargaining. 

          You seem to be confusing management of staff and negotiations with the employer.  I presume that your company has an overall budget for individual pay deals.  A trade union would probably negotiate on that amount.  Of course, if the employees are happy with their pay etc then there is no need for a trade union.

            

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