Dear Gordon
Firstly, may I congratulate you on the double victory of moving into the leadership position of both your political party and the country without the need for anybody to actually vote for you, an achievement previously unheard of within the labour movement. You feel it is just reward after your dedication in your previous 10 year reign as Chancellor of the Exchequer. Apparently, many of your party members saw it somewhat differently, but then who cares - after all, they are only there to give the party their money and the last thing you want is them mucking things up by actually voting.
I notice that has been one of your first actions as leader - to try and stop them voting at party conference on those tricky little items that the party desperately wants to avoid being discussed. You are trying to take away their cheeky little trick of submitting last minute contemporary motions following recent embarrassments which mean Labour Party policy has to Re-Nationalise the railways, provide more direct investment to building new council housing, an immediate restoration of the link between pensions and earnings, against the creation of foundation hospitals and for a halt to the Private Finance Initiative until it was proven to be a better use of resources than straightforward public sector financing. As this has been largely led by the Trade Unions, you must think you can keep them onside to get them to accept this - we’ll look at that later - or perhaps you feel you can do without the funding they provide to the tune of tens of millions of pounds every year because your good friends in the boardrooms will provide it instead. Let’s hope so - I’m sure they’ll come through for you even without the hope (whether the rumours were true or not) that they had for a peerage in return.
As PM, there must be a lot of things you want to get on with doing for the country. I hope you find time to tackle them, and are able to help with a few issues I have over what you plan to do about some key areas I think need tackling. They are all issues which you haven’t seemed to find the time to address yet, so hopefully they’ll be helpful to you. You will probably recognise a few of them from your time in Treasury - many have been saying that you may not have agreed with them but they were foisted upon you by Tony Blair (boo,,,hiss…) so I’m sure you will be keen to show him up quite early in your reign by changing things now.
Let’s start on familiar territory. Money - should be straightforward enough after all those years keeping the company accounts for UK PLC. So how are we doing?
Well, on the face of it, quite well it would seem. After all, Britain's richest 1000 people have quadrupled their wealth under Labour, increasing their wealth by 20% in the past year alone. Company profits are at record levels and Executive bonuses are of previously unheard of generosity with thousands becoming millionaires overnight as a result. Britain has been increasing it’s total millionaires and billionaires for a number of years now. So all this must mean a lot of money is going into the coffers, as well as feeding down to workers at the lower end of the pay scales yes?
Well, actually no - no it isn’t! Corporation tax has been reduced from 33% to 28%. Btitain's 54 Billionaires paid £14.7 million in tax between them last year - that’s around 0.1% of their incomes! Compare that to the poorest 20% who pay an average of 38% in total if you include indirect taxation. FTSE100 directors now receive 98 times the wage of their workers average - only the US has a higher ratio - and the lowest estimates for the cost to taxation of the non-domiciled residents, otherwise known as those who are using Britain as the tax haven it has increasingly been seen as for the super rich, are over £5 billion per year. Whilst profits are at an all time high, it was recently announced that of the top 700 UK companies, 1/3 didn’t pay any corporation tax at all last year, with a further third paying less than £10 million.
In the meantime, 7.5 million people live in absolute poverty, with the number of children living in poverty increasing by 100,000 in the last year despite your pledges to end child poverty. There are more unemployed 16-18 year olds than before The New Deal was introduced, and more people now work as domestic workers than there were personal servants in Victorian times. The UK came bottom of the OECD survey of the best country to live in based on socio-economic factors, housing costs make up a higher proportion of earnings than ever before and 93% of workers cannot afford to buy properties in their home city. Interest rates have now increased 5 times recently which will start to hit hard now many fixed rate start-ups are ending, and repossessions are already increasing massively. Every 0.25% increase in interest costs £15 per month on a £100,000 mortgage, which is a hefty sum. People won’t be able to borrow their way out of trouble either, because your policy of keeping the economy afloat by encouraging consumer spending has meant that for the first time ever personal debt is now higher than the UK’s Gross Domestic Policy.
So how have you said you’ll deal with this? Well, the first thing you have done is to impose a 2% pay cap on all public sector workers. And not just for the year - it’s for the entire Comprehensive Spending Review period, which runs until 2011. You say this 2% is based on inflation - or at least don’t make much effort to make it clear it is based on your inflation TARGET. Actual inflation has been running at around 2.5% for the past couple of years.
Actually that’s another lie as it hasn’t. The whole inflation thing is actually a complete lie. What you have been doing is using the Consumer Price Index measurement of inflation. What most people don’t realise is that it doesn’t take into account several things, most importantly housing related costs. In fact, it was only introduced in 2003 to allow a comparison to be made with other European countries where housing makes up a smaller proportion of people’s income, to look at whether we should join the EURO. The real measure of inflation is meant to be the Retail Price Index, and that’s around 4.5%, although that’s under dispute and a lot of people are suffering much larger increased living costs. Let’s look at a few of them.
We already mentioned mortgages, but it’s worth adding that many offers are now based on seven times a persons salary, when a few years ago it was onlt 3 ½ times. Government targets for council tax increases were set at 5% last year, although many went above that figure. The targets were only introduced because the increases were coming in even higher above the inflation rate than that for several years, with the total paid more than trebling since it was introduced in 1993. I doubt those targets are much consolation to the pensioners who have went to prison over it for some reason. Average gas bills have risen by 94% in the past three years, with the average household paying £1000 per year to heat it. Electricity has also risen well above inflation since most of it comes from gas as well.
Looking at some other costs of staple items (not fancy electrical goods which have been included into the inflation “shopping basket” thanks to your encouragement for consumerism, since nobody can yet eat their I-pod) and we tea, coffee, bacon, eggs and bread have increased by 11.3%, 6.4%, 8.2%, 10.2% and 7% respectively, with fruit going up by 6.6% and veg by 7.7% - costly when people are trying to make sure they eat their five portions a day. Rail fares have increased by 4.7%, with you allowing companies to increase fares by between 1% and 2% above inflation over the next few years (what happened to the re-nationalisation by the way - we now pay three times more in subsidies than we did under British Rail, which has amounted to roughly the same as the rail companies have taken in profit over the same period?). The annual cost of running a car is now £5,500, and Bus fares have led to local campaigns in several major cities over the last three years, starting in my own home city of Sheffield where I was involved in setting it up following 4 price increases in a single year. UK childcare costs are also amongst the highest in Europe at around £144 per week for one child. Student fees have been introduced and are expected to treble, with student debt tripling to £3 billion in 10 years, meaning a debt expected to reach £30,000 for those leaving University.
Now you say the public sector pay caps are crucial in reducing inflationary pressures, but there is absolutely no evidence that suggests they are even linked. In fact, there are huge numbers of that are amongst those who suffer more as a result of inflation than most. In the Civil Service, which is traditionally one of the lowest paid areas of the public sector, over a quarter receive less than £16,000 per year, with well over half receiving less than the National average wage. Not really a way to cut inflation at all that, is it Gordon? Pushing those already near the poverty line below it won’t help inflation, and it certainly won’t help the people left in poverty.
Before you think I’m getting all gooey eyed about public sector workers, I really should point out that - as you have admitted - you expect the Private sector to follow suit. The Public sector is highly Unionised, but the Private sector isn’t so they are far more likely to get away with what the public sector might not let you do for them. That’s a test possibly still to come with the PCS having taken two days strike action in the past year, with more to come, the Postal workers in the CWU striking, and even the Prison Officers Association taking strike action for the first ever time, and unlawful action at that. Ballots are taking place in your traditional safer areas of nurses and local government workers as even your stooge in charge of UNISON, Dave Prentis, can get away with stopping his members take the action they want to for so long - the four consultative ballots in local government areas has been well and truly seen through and they are raring to go given the chance. Derek Simpson in Amicus can’t hold the troops back for any longer, and Tony Woodley can’t hold off his TGWU troops much longer, so their new super union Unite looks like doing just that shortly, and will be marching on your first Labour party conference as leader to tell you just that by way of a demonstration on the 23rd September.
Your lie about there not being money to pay for the pay rises takes a bit of a battering when compared to the unlimited funds that seem to have been made available for the Iraq and Afghanistan wars (£7.4 billion upto April 2007), the estimated £75 billion for a new, completely un-necessary Trident, and the speed with which the countries most profitable company - Barclays - was quickly bailed out with over a Billion pounds in short term loans when it needed them due to some alleged technical glitches.
If the TUC holds it’s nerve and passes the motion laid down by the PCS, you could be facing a general strike of public sector workers. If that happens, low paid private sector workers are likely to want a piece of the action. Despite your constant praise of the Minimum wage, many people have come to realise that employers increasingly see it as a maximum wage for those starting out at work, made even worse by the huge influx of unskilled migrant workers pushing pay down for many other workers by their acceptance of it.
You don’t have many friends left in the Trade Union movement, and that will be tested further when the Trade Union freedom bill hits Parliament - all it asks is the removal of the very worst anti-union legislation introduced by your new heroine Margaret Thatcher, and in fact doesn’t even give the Unions the same rights they had with the 1906 Trade disputes act. If that gets talked out by one of your caninet Ministers it will be most embarrassing. That’s worth noting actually - it can be talked out because it’s actually a Private members bill so not even introduced by the Government. It’s been left to the only real Trade Union man left in your Government to introduce it. The praiseworthy John McDonnell who you might remember from ensuring enough threats were made to stop Labour MP’s letting him give party members the chance to actually vote you in as leader. Not sure why you were so scared - he said himself he only wanted to ensure a public debate over Labour policies and didn’t ever expect to win. It must have been the debate bit that scared you, although I can understand why that might be since it would have revealed you no longer represent the labour movement.
Another challenge you face from the Unions will be over proper employment protections for Agency workers. Despite that being a manifesto commitment, that is the Bill that was talked out recently by your government, and at the same time prevented the Trade union Freedom Bill being heard the first time it was due. Police are now looking for the right to strike, action is desperately needed for a proper corporate manslaughter bill and the introduction of a legal maximum working temperature.
Possibly the biggest challenge to come out of the TUC will be if they really put the pressure on to stop the increasing privatisation of public services. In the past decade, Labour has been responsible for more privatisation that throughout the entire 18 years of Tory rule.
Costs are proving hard to come by, largely because of your cry of commercial confidentiality when we ask what you are doing with our (the taxpayers) money. One figure we do know about is the £5 billion per year paid to private medical firms to undertake the routine operations, which is upto 1/3 higher than they would cost in the NHS in total, never mind that the NHS total is calculated using the pre and after care costs which they still have to pay for, and that the figure is based on a fixed number of operations which they get paid even if they don’t actually perform them.
Some other figures are starting to slip out now about your beloved PFI, and they are grim reading. PFI of course is what you opposed in opposition but have embraced as pretty much the only form of capital expenditure allowed for most public infrastructure building now undertaken. In Coventry, what started out as a £34 million refurbishment of two hospitals became a £410 million project which has just cost the NHS trust £56 million for a years payments, which is set to increase at the RPI (which is good enough for your big business friends it seems) for the next 30 years. That’s just a single project. It pales into insignificance when compared to the £18 billion MOD privatisation of training services, or the £20 billion NHS IT system which is looking on the brink of collapse and, as the former head of it Richard Granger accidentally admitted, won’t achieve anything that can’t be done with either a phone, fax machine or e-mail - so hardly the ground breaking scheme we were told it would be. There are of course many, many more examples, but people can read the Private Eye to find a few of them and the fact that PFI now runs at well over £100 billion with more expected to come is worrying enough for me.
So I suppose an answer to some of that would be how you reward the Trade Unions for the funding they have provided over the past decade, which is in excess of £100 million.
The answer going by your new Government is no thanks at all. No Senior Trade Union figures are there at all. Now that normally wouldn’t be seen as a big problem, and would even be seen as unusual. Or it wouldn’t be if it wasn’t for the fact that you have been introducing opposition MP’s into your Cabinet, even going so far as to offer a post to Paddy Ashdown who was once the leader of the Liberal Democrats. You also recently gave a job as an adviser to one of the Tories largest financial backers, which rubs their faces in it a bit.
Not nearly as much as you’ve rubbed the Unions faces in it by elevating former Head of the CBI Digby Jones to the Cabinet with a peerage. The same Digby Jones who described Trade Unions as being “increasingly irrelevant”. And although he will answer to the Labour whip to take up his Cabinet position, last I heard he was refusing to actually join the Labour party.
I think that just about sums up the whole New Labour project perfectly. Rubbing dirt in the faces of the Trade Unions and workers who fund you and you were set up to represent, and so firmly in the pocket of Big Business that you have brought one of their best known leaders into your Cabinet.
And you say you are different from the other parties exactly how????????
Unless you provide a dramatic turnaround of all this very quickly, which I don’t really expect will happen, the next time you hear from me I’ll be doing the type of thing myself and others are in this video:
The Scottish Stoner
The Northern Rock has had problems which we all know about - a run on the bank caused by a combination of a catastrophic drop in their share prices and their high risk (but potentially high yield) Business model, with 70% of their funds reliant on the money markets, which have taken a battering because of the US mis-selling in the sub prime sector which has seen 20% of borrowers default and a million lose their homes already, with expectations of many more to follow. 
Having received quite substantial amounts of literature through the post from my local Lib Dem councillor in Sheffield around the time of the elections, which ended in a hung Council, I’ve received some more today, so they are obviously pushing with an eye on gaining control of the Council. The latest is a leaflet on local NHS Services and how good/bad people feel they are in Sheffield, with the suggestion that Labour (who are the main opponents in Sheffield to the Lib Dems) have let the City down.
Dear Gordon
