In the Absence of Economic Democracy

MPs open fire on Kraft over plans to shut Cadbury factory

Kraft couldn't give a toss about it's reputation; it's in business to asset-strip Cadbury's, and for the likes of Lord Mandelson and his fellow corporate-grovellers to be complaining now is a classical example of the 'Third Face of Power' in action: pursue market fundamentalism below the radar, appear to be doing the opposite on the radar.

Report on takeover says the US food giant was either incompetent or cynical ...

Cadbury had earmarked the 75-year-old plant for closure in October 2007, which would have prompted production of Curly Wurlies, Fudge and Mini-Egg to move to Poland.

In its takeover proposal documents released in September, Kraft said it "would be in a position to continue to operate" the Keynsham facility.

Just a week after sealing the takeover, Kraft performed a startling U-turn at the cost of 400 jobs. Following meetings with Cadbury management, Irene Rosenfeld, the chairman and chief executive of Kraft Foods, said "it became clear that it is unrealistic to reverse the closure programme".

The move sparked outcry from the public and politicians.

The report said Kraft "has left itself open to the charge that either it was incompetent in its approach to the Somerdale factory or that it used a 'cynical ploy' to improve its public image during its takeover of Cadbury.

"Its actions have undoubtedly damaged its UK reputation and has soured its relationship with Cadbury employees," it added ...

Independent  07 April 2010    'Third Face of Power'

Kraft promises MPs: no job cuts in UK

Mandelson calls for tougher takeover rules

Brown warns Kraft on jobs

The sad lesson of Cadbury is the City still holds the whip

£2m a day cost of Cadbury deal – plus £12m for the boss

Critics unite over executive pay to force the 'aliens' of business down to earth

City minister urges FSA to investigate the role of shareholders in fight against short-termism and excessive executive pay ...

Richard Lambert, the director general of the CBI, the employers' organisation, told a business audience in London on Tuesday that "the reputation of business has been dented" and that bosses risked being viewed as "aliens" living in "a different galaxy from the rest of the community" as a result of the ever-widening gap between average pay and boardroom rewards.

"For the first time in history it has become possible for a manager – as opposed to an owner – of a large public company to become seriously rich."

Lambert blamed globalisation, hostile takeovers and what he called "Jack Welch capitalism" – a relentless drive to improve returns to shareholders at the expense of other stakeholders – for the image problem business now faces.

He suggested that businesses could never be viewed as "a positive force for good", creating wealth and jobs, while short-term shareholder value is the main boardroom aim ...

Guardian  31 Mar 2010

Executive pay and bonuses

Russians prepare £1bn grab for UK fuel supplies

GAZPROM ... is expected to lodge an offer this week for a network of 800 petrol stations and the Lindsey oil refinery at Killingholme, Lincolnshire.

The assets have been put up for sale by Total, the French oil group. It has hired JP Morgan, the investment bank, to sell its UK business, which employs 5,000 people.

The business is expected to fetch more than £1 billion ...

The auction is part of a remarkable shake-up of Britain’s oil refining and distribution industry. Half of the refining capacity, built up in the 1960s and 1970s to take production from a booming North Sea, is up for sale as energy giants look to sever ties with the low-margin, low-growth British market ...

Times  28 March 2010        

Unemployment fall raises recovery hopes

• Claimant count falls to 1.59m people
• Wider jobless measure falls 33,000 to 2.45m people
• But 'economically inactive' people rises to record 8.16m
• ... and employment hits lowest since 2006 ...

... the number of people who have been unemployed for more than 12 months rose by 61,000 over the quarter to 687,000, the highest figure since 1997.

And employment is down 54,000 to 28.86 million, the lowest level since 2006.

A record 8.16 million people are now classed as economically inactive, which includes students, people on long-term sick leave and those who have given up looking for a job ...

LGFlover
17 Mar 2010, 9:59AM

The Job Centre managers have been told in unequivocal terms that their bonuses rely on them reducing the number on Job seekers Allowance and they can use any means.

The means they have used is to push the long team incorrigibles on to Employment and Support Allowance.

And yes I am aware that this trick was first used under Thatcher.

Guardian  17 Mar 2010

Quarter of adults out of work

UK unemployment falls ...

Kraft promises MPs: no job cuts in UK

Kraft made a humiliating public apology and vowed not to axe any UK manufacturing jobs for at least two years after it was accused by MPs of fighting dirty for control of Cadbury.

The pledge, which only covers 40% of the UK workforce of the enlarged business, was made by Kraft's executive vice-president, Marc Firestone, during a bruising two-hour appearance before the business select committee that left the American visibly shaken.

Not only verbal insults were levelled at Firestone during the hearing.

Lindsay Hoyle, Labour MP for Chorley, shook a Terry's Chocolate Orange at him as an example of Kraft's poor track record as a custodian of British companies.

He said the once was famous chocolate was now "made in the EU" and the York factory long gone.

Kraft made similar promises to Terry's of York only to move production to Poland, said Hoyle who added they did "exactly the same" to York as the Vikings: "They pillaged and asset-stripped that company."

Firestone said Terry's and Cadbury were two very different companies, adding the former "did not have the scale" to continue operating from its York base ...

Guardian  16 Mar 2010

Mergers and acquisitions

Labour rolls over for BA's bullies

[Washington Consensus Clause Six: 'Strict control on organised labour']

Brown has condemned Unite, but it is chief executive Willie Walsh who has forced the BA dispute to the point of a strike ...

... the events of the past few days have now shown beyond doubt that it is BA's reckless outgoing chief executive, Willie Walsh, who will be responsible if this weekend's walkouts go ahead.

By refusing to put BA's compromise offer to an immediate ballot of BA cabin crew unless strikes were called off, he made sure they would not be – and demonstrated that his real aim is now to try and break the union.

All the signs are the company's £62.5m renegotiated savings package – or the union's counter offer, including a 2.6% pay cut – would have been accepted, even though they were both opposed by cabin crew activists. But when you add in Walsh's attempt to recruit a strike-breaking army at vast expense and the company's campaign of intimidation against cabin crew, including dozens of suspensions for a string of trivial misdemeanours, the union-busting agenda is clear enough.

Underlying the dispute, of course, is a series of corporate failures under Walsh's stewardship, the impact of recession and the threat from low-cost airlines that have led the way in driving down labour costs and standards across the industry.

That BA cabin crew should be condemned for attempting to halt the race to the bottom and negotiate a better way out of the crisis simply reflects the corporate prism through which all economic and business issues are now debated in the public mainstream ...

myfellowprisoners
15 Mar 2010, 6:57PM

Unions should be asking themselves if their money donated to Labour is somehow different to the money donated to Labour by businessmen.

It seems that a strange transmutation occurs with the union donations, whereby the time the £'s get transferred to the Labour Party Coffers, they transform into Zimbabwean dollars or something similarly worthless. At least you would assume so, from the way that New Labour then proceed to treat them.

The capitalists get what they want for their donations, and no questions asked. The unions are lucky to get a watered-down version of their demands and get publicly insulted by Labour, to boot.

Isn't it time the unions stopped wasting their members' money on these pigs, and put it towards funding a new party? One that actually represents the interests of the working person?

Guardian  14 Mar 2010

Unite

OECD: UK has worse social mobility record than other developed countries

The chances of a child from a poor family enjoying higher wages and better education than their parents is lower in Britain than in other western countries ...

Highlighting the UK's lack of social mobility, the Paris-based thinktank said the chances of a young person from a less well-off family enjoying higher wages or getting a higher level of education than their parents was "relatively low" ...

It added that there was a hefty wage premium associated with growing up in a better-educated household and a corresponding penalty for being raised in a less-educated family ...

In the UK, the OECD found that 50% of the economic advantage that high-earning fathers have over low-earning fathers is passed on to their sons.

By contrast, in Australia, Canada and the Nordic countries, less than 20% of the wage advantage was passed on ...

mugclass
10 Mar 2010, 1:58PM

In my town, if you live in one of the less well off area, your children will go to one of three schools, all of which have just received damning reports from Ofsted. For a bright child from a low income family there is no hope. You will be educated in a school with high truancy, high level of behavioural problems, high levels of disruptive behaviour, a high teacher turnover and frequent teaching by supply staff.

My husband and I were fortunate to benefit from the grammar school system, and although our families were both low income we went on to excellent universities and good careers.

Labour have managed to achieve great equality - the equality of ensuring that if you are from a poorer background, no-one will do well. They have achieved equality of failure.

Guardian  10 Mar 2010    Education for the Good Society    Inequality

OECD

A Family Affair

Frustrated pupils 'bored by their factory schools'

UK low in social mobility league, says charity

Manufacturing sector needs a new direction

One of the cruellest aspects of this recession is that while the banking industry has staged a spectacular comeback, manufacturing is suffering real damage.

The pain began in the 1980s when the Conservatives, under Mrs Thatcher, crushed the miners, deregulated the jobs market, privatised utilities and slashed tax rates.

But New Labour must bear much of the responsibility. As chancellor, Gordon Brown behaved as Thatcher's heir and espoused her free-market liberalism, cultivating the City and financiers. The result is that now the recession has struck, the economic divide in this country is plain to see.

A paper from the Centre for Research in Socio-Cultural Change (Cresc) at the University of Manchester* has found that despite a decade of apparent economic boom, private-sector jobs were not generated in sufficient numbers to fill the gap left by traditional manufacturing.

Instead, public-sector jobs and employment supported by the state accounted for more than half of all job creation nationally and much more in the former industrial regions ...

The reliance on finance has, Cresc claims, returned inequality to Edwardian levels because of the emergence of a new class of "working rich" individuals, almost all of whom are in finance, and in London.

Some of the dire consequences of this were masked because the slack was partly taken up by the public sector, which expanded under Brown – for worthy reasons, it must be said, including the improving of health and education services.

That, however, hid the fact that the private sector has failed to create high-quality jobs and sustain prosperity. Cresc goes so far as to claim that former industrial regions such as the north-east have no other visible means of support than the public sector ...

Observer  07 Mar 2010

CRESC Working Paper No.75

Mandelson calls for tougher takeover rules

•Raising the voting threshold needed to secure new ownership to two-thirds

•Lowering the requirement to disclose share ownership during a takeover bid from 1% to 0.5%

•Giving the bidding company less time to tie up a deal

•Forcing bidders to reveal how they intend to finance a takeover

•Requiring greater transparency on advisers' fees and incentives ...

BBC NEWS  01 Mar 2010

Kraft inquiry hits Takeover Panel succession

Worst round of council job losses 'for a generation'

Councils could face the worst round of job losses "for a generation" with at least 25,000 under threat, according to a new survey ...

A number of councils have already indicated over the last month that they will cut jobs. Birmingham city council, the country's biggest local authority, confirmed they were planning to shed up to 2,000 jobs over the next financial year.

Nottinghamshire council has also warned it planned to cut up to 1,500 jobs in an attempt to save £200 million over the next five years.

The job loss figure of 25,000, is based on answers from 49 councils, who employ a combined 256,000.

While many of the councils were reluctant to forecast job cuts, eight - Kirklees, Leeds, City of Bradford, Sheffield, Stoke-on-Trent, Nottinghamshire, Lincolnshire and Surrey - said 1,000 or more might go in the next five years ...

The survey by BBC English Regions, which was sent to 150 county and unitary councils and metropolitan and London boroughs, also found that almost all councils who responded said they expected budget cuts, with libraries, the arts and leisure the most at risk.

Almost all of the councils said they planned to share services such as health trusts and schools with other parts of the public sector in order to save money ...

Telegraph  01 Mar 2010

Birmingham to cut up to 2,000 jobs

Takeover frenzy is leaving Branch Office Britain with an identity crisis

If there is one good thing to come out of Kraft's takeover of Cadbury, it is that the Takeover Panel is finally taking a look at a system that tilts the odds too far in favour of foreign predators.

UK companies are among the least equipped in the world to defend themselves against hostile takeovers, because our markets are so open, even in comparison with the US where companies often use poison pills and other bid-repellents.

Businesses here are also vulnerable because the process is easily manipulated by the bidder. The takeover timetable allows predators to place targets under siege for extended periods: Kraft went public with its interest in August, but the 60-day clock only started ticking in December.

Roger Carr, the former chairman of Cadbury, raised this and other issues including increasing the shareholder voting threshold from a simple majority to 60%, and the possibility of disenfranchising hedge funds and other short-term investors. The panel will look at this and publish a consultation paper.

It will take its time, and it is unlikely to come up with wholly satisfactory reforms: it is not within its remit, for instance, to delve into whether a bid is in the public interest, though I'm with Vince Cable in thinking that this important test should be restored ...

The UK has seen more foreign takeovers in the past six years than Japan or Germany, both of which are larger economies ...

Ownership matters, especially in a recession. Inflows dry up – new foreign direct investment in the UK fell by 90% last year – and existing spending can be savagely cut. Companies are likely to prioritise their home markets, leaving jobs and pensions in the UK at risk: Tata, for instance, is increasing steel production in India while mothballing its Redcar plant ...

The risk is that this country could dwindle into Branch Office Britain, and that the owners of assets will be remote and unaccountable ...

Guardian  28 Feb 2010

Russians prepare £1bn grab for UK fuel supplies

Airbrushing Employment Figures

NeitherLeftNorRight
26 Feb 2010, 8:22AM

Official comments on the Lloyds figures will definitely get airbrushed if they don't please Brown.

What happened to the ONS press release when employment figures were released in January this year serves as the perfect example.

Two salient comments were deleted from the original version as some figures were altered.

The comment that the employment rate is the lowest since the winter of 1996/97 has gone missing despite the revised rate being exactly the same as the one put out in January, while the comment that part-time employment was the highest since records began in 1992 has gone up in smoke perhaps because it was lowered by 20,000 but I do really doubt it.

As the ONS press release read on 20 Jan:

The employment rate for September to November 2009 was 72.4 per cent. This is the lowest since winter 1996-97 and is down 0.1 on the quarter.

The number of people in employment fell by 14,000 on the quarter to reach 28.92 million, the number of people in full-time employment fell by 113,000, and the number of people in part-time employment increased by 99,000 to reach a record high of 7.71 million.

There were 1.03 million employees and self-employed people working part-time because they could not find a full-time job. This is the highest figure since records for this series began in 1992 and it is up 46,000 on the quarter.

As it reads now:

The employment rate for October to December 2009 was 72.4 per cent, down 0.1 on the quarter.

The number of people in employment fell by 12,000 on the quarter to reach 28.91 million. The number of people in full-time employment fell by 37,000 on the quarter to reach 21.22 million, the smallest quarterly fall since the three months to July 2008.

The number of people in part-time employment increased by 25,000 on the quarter to reach 7.69 million. There were 1.04 million employees and self-employed people working part-time because they could not find a full-time job.

This is the highest figure since records for this series began in 1992 and it is up 37,000 on the quarter.

The original version can still be found on the guardian's site in a post of mine and labour spinmeisters have not (yet) been able to delete it:

Please note that the employment rate is the lowest since 1996/97 despite the rise in part-time employment and the 1 million increase in public sector employees.

Guardian  26 Feb 2010

Surprise fall in UK unemployment amid surge in part-time jobs

UK still good investment opportunity - Brown

As Cadbury and Corus Steel can confirm

Around 250 chief executives, entrepreneurs and academics are due to attend the Global Investment Conference, which will be addressed by Gordon Brown today.

The government will also launch a new "investors' charter' at the event, which is expected to include a pledge to consult large companies before making further changes to the tax or regulatory system ...

Lord Davies, the trade minister, argued that the UK had a good track record at attracting foreign investment.

"The UK has been hugely successful at attracting foreign direct investment ... There are over 75,000 foreign-owned companies in the UK and they account for around 40% of GDP," he said.

Guardian  22 Feb 2010

Welcome to the office, the new Stasi state

David Craig, whose books, including Plundering the Public Sector and Fleeced, earn him honourable mentions in dispatches on the follies of the centralised state, cites dozens of examples of a top-heavy bureaucracy.

In 1997, the NHS had 12 hospital beds per manager; now it has four. Even in 2008, when politicians were protesting that they wanted to protect front-line services during the recession, the NHS had a 2% increase in medical staff and a 10% increase in managers.

In local government under Brown, the number of people in councils earning more than £50,000 a year has shot up by a factor of 11 from 3,300 to 38,000, while in the economy as a whole it only went up by a factor of three.

I could go on quoting him, but it ought to be clear that while the characteristic beneficiary of the Attlee era was the factory worker and the characteristic beneficiary of the Thatcher era was the entrepreneur, the characteristic beneficiary of the Brown era has been the target-setting manager, regulator or consultant ...

Observer  21 Feb 2010    Plato V Illich

Reforming the Regime

The blight of foreign owners

There was no more fervent forelock-doffer to the Thatcher 'transformation' of Britain to 'free' market goals than The Dacre.

Now that the downsides are emerging, The Dacre whinges constantly but to no effect. It's all 'sound and fury, signifying nothing'.

Like Brown and Mandelson - faced with the unpopularity of their neoliberal policies - they fret and fume and spin, but to no avail.

It's an exerecise in the third face of power: voters must get the impression that it's someone else' fault.

When the industrialist Ratan Tata won control of Corus, the Anglo-Dutch steelmaker in 2006, the deal was hailed by Labour as marking 'a new era of British-Indian relations based on equality of common interest'.

At a subsequent meeting of Gordon Brown's business council at the Treasury, Tata - then the proud owner of Corus and Jaguar Land Rover - was hailed as a business hero who extolled the virtues of open markets. There was a basic flaw in his speech.

Whereas Britain, since the age of Thatcher, has allowed foreign enterprise to snap up UK assets, many British companies have found it extraordinarily difficult to break into the Indian market, particularly in finance, and have to operate with Indian partners and through joint ventures Britain's open-door policy has proved a very mixed blessing.

In the case of Jaguar Land Rover it was to the UK Government that Tata turned for help at the height of the 2008-09 recession. Now we find that while Tata is still expanding steel production in India it is abandoning the iconic Redcar plant.

No one wants a return to the 1970s, when Britain propped up ailing industries, but in an era when £1trillion has been lavished on keeping the banking industry afloat - some of it leaking into the bonus pot - there must be a case for short-term subventions.

One must also ask whether an independent Corus, without the debt burden of its Indian parent, would have been quite so susceptible to global winds of change or have been exploited in quite the same way for 'carbon' allowances.

The announced closure earlier this month of Cadbury's Somerdale plant near Bristol, just days after Kraft seized control, was a further example of how foreign owners simply do not care, whatever promises they may have made to government and the unions.

One has to trust the Pensions Regulator is keeping a close eye on how Cadbury's new owner intends to deal with the deficit in the confectioner's pension fund. As we reported yesterday the trustees have called in advisers to assess the deficit.

Having recently abandoned a defined-salary scheme in the US it is hard to believe Kraft will be that keen to honour pensions promises to Cadbury workers.

Daily Mail  20 Feb 2010

Sick trade in NHS medicines

700,000 Britons swell the ranks of 'underemployed'

... the Office for National Statistics has reported that the equivalent of an extra 2.8 million people are officially "underemployed" – that is having to work fewer hours than they want – in addition to the 2.6 million officially out of a job.

A total of 5.4 million Britons are working less than they would wish, a figure that could yet be higher if the number of self-designated "students" and other examples of disguised unemployment that can be extracted from the official statistics are included.

Independent  17 Feb 2010

Eight million people 'economically inactive'

Underemployed make jobless figures 'deceptively good'

The UK jobs market looks "deceptively healthy" because of an increase in the number of people having to settle for part-time work, the TUC has warned.

The union body says thousands of people are only taking part-time or temporary work because they are failing to find full-time employment.

Also, an Office for National Statistics report showed a rise in "underemployed workers" working less than they wanted.

BBC NEWS  16 Feb 2010

Flexible working 'good for heart and soul'

People who can chose their own working hours enjoy better physical and mental health, a report has suggested.

Researchers for the Cochrane Library found employees who had control of their hours could have better blood pressure and heart rates.

Its review of 10 studies of more than 16,000 people also said it might have a positive impact on mental health ...

BBC NEWS  17 Feb 2010    

New flexible work law 'is toothless'

Birmingham city council to cut up to 2,000 jobs and close care homes

In the absence of economic democracy child protection, the elderly, those with learning disabilities, and a variety of other services face cuts. Meanwhile, Unilever is threatening to move abroad because corporation tax is too high.

Britain's largest local authority plans to shed up 2,000 jobs, freeze staff pay and reduce services in what is being seen as a foretaste of serious cuts to council budgets across the country.

Birmingham city council, which employs about 35,000 staff, has proposed the moves in an attempt to save £75m over the next year, cover losses in income and keep a lid on council taxes rises.

The crisis is understood to have been triggered by multi-million pound overspends in child protection and services for older people and adults with learning disabilities.

The job losses are understood to be earmarked for areas such as adult social care, housing, libraries, sports centres, museums.

Day centres and care homes for older people face closure ...

Guardian  10 Feb 2010

Let's call the bluff of the tax whingers

Blue chips threaten tax exodus

Slashing corporation tax

City bonuses soar despite super tax

Diageo hits out at UK tax regime

Unilever threatens to pull out of Britain over rising taxes

Mandelson's 'disappointment' after Kraft meeting

As a supporter of global free markets, Mandelson is pretending to interfere with the Invisible Hand in pursuit of the third face of power.

Business Secretary Lord Mandelson has said he is "disappointed" that food giant Kraft would not commit to managing Cadbury's brands in the UK.

Lord Mandelson spoke after a meeting with Kraft boss Irene Rosenfeld.

He said he was glad of the personal meeting, but would now be looking for "much harder, more specific commitments in the next three to six months" ...

BBC NEWS  02 Feb 2010

Rich-poor divide 'wider than 40 years ago'

Ms Harman appears to be unware of the terms of the Washington Consensus.

The gap between rich and poor in the UK is wider now than 40 years ago, a government-commissioned report says.

"Deep-seated and systemic differences" remain between men and women and minority groups in pay and employment, the National Equality Panel found ...

The issues raised would need "sustained and focused action", Equalities Minister Harriet Harman said.

"But for the sake of the right of every individual to reach their full potential, for the sake of a strong and meritocratic economy and to achieve a peaceful and cohesive society, that is the challenge that must be met," she added ...

The report finds: Parents of public school-educated sons can expect their children to be paid eight per cent more by their mid-20s than boys educated at state schools; At school poor British white boys are well below the national average by the time they are seven, deteriorating further after they are 11. Women are paid 21 per cent less than the national average, despite women into their 40s having better qualifications than men; Britain has one of the most unequal societies in the world, with income inequality ahead of Ireland, Japan, Spain, Canada, Germany and France. Inequality is worse in England than Wales and Scotland; A typical professional on the verge of retiring is worth nearly £1 million compared with just £59,000 for someone who is long-term unemployed. Poverty rates are among the worst in Europe, with only Italy, Spain and Greece faring worse. Average and below average White British children are less likely than those from minority ethnic groups to go on to higher education. More than half of children educated at private schools, and more than 40 per cent of those with professional parents, go to the top Russell group of universities. Two-thirds of those with professional parents receive firsts or upper seconds, but only half of those with unskilled parents. Telegraph 27 Jan 2010

The panel pointed out that half of those who have worked in the top professions have net assets worth more than £900,000, while a 10th of those who have had unskilled jobs have property, savings and possessions worth less than £8,000 ...

BBC NEWS  27 Jan 2010

GEO

Richest 10% are now 100 times better off than the poorest

Inequality in the UK: the data ...

'You're stigmatised if you live on a council estate'

Labour fails to understand 'inequality'

Labour Market For September to November 2009:

The employment rate was 72.4 per cent and there were 28.92 million employed people.

The unemployment rate was 7.8 per cent and there were 2.46 million unemployed people.

The inactivity rate was 21.2 per cent and there were 8.05 million working age inactive people.

Office for National Statistics  20 Jan 2010

Fall in official unemployment rate masks rise in the 'hidden jobless'

Brown warns Kraft on jobs

Brown's bluster in regard to the Kraft takeover of Cadbury is a cynical attempt
to pretend that the government can influence Kraft's jobs and investment policies.

Agreement by Cadbury to a £11.9bn takeover bid from its US rival Kraft Foods prompted Gordon Brown today to warn the American conglomerate to protect jobs in the West Midlands.

Cadbury accepted defeat in its battle to stay independent by recommending a £11.9bn takeover from Kraft, ending one of the most fiercely contested takeovers in the City for some time.

Cadbury employs 6,000 people in the UK and the Unite union expressed fears that the deal would lead to job losses as the US company puts a priority on paying back its debt. "Whatever good intentions Kraft may have towards Cadbury's workforce, the sad truth is there will be an irresistible imperative to pay down their debt, and this raises real fears for jobs and investment in this country," said Jennie Formby at the union.

But the prime minister said today: "The one thing I want to say is this: we are determined that the levels of investment that take place in Cadbury's in the United Kingdom are maintained. And we are determined, of course, that at a time when people are worried about their jobs, that jobs in Cadbury can be secure" ...

Guardian  19 Jan 2010

The sad lesson of Cadbury is the City still holds the whip

£2m a day cost of Cadbury deal – plus £12m for the boss

Mergers and acquisitions

Private Equity

Recession widens gap between strong and weak regions

Recession has bitten hardest in cities already ravaged by long-term industrial decline, exacerbating the divide between Britain's strongest and weakest regions, according to a thinktank report published today ...

The difference between the strongest and weakest 10 cities, measured by the number of people claiming jobseeker's allowance, has increased by 70% since the downturn began.

In Hull, which has suffered the largest increase in joblessness since the downturn began, more than 6,000 people have been added to the unemployment register and there are now an estimated 16 jobseekers for every vacancy. In Cambridge, the least-affected city, the recession has added just 705 people to the unemployment total.

Adam Lent, head of economic and social affairs at the TUC, said the report's findings showed that any new government should intervene more actively to support jobs and investment in cities that will otherwise be left even further behind ...

( ... the centre's director, Dermot) Finch warned that politicians must beware of believing they can create jobs, by investing in high-profile regeneration projects or trying to attract new industrial sectors from scratch. Instead, with money tight, they should focus on fostering the right climate for private sector job creation – by smaller scale projects to improve transport links, reclaim land, or boost local skills, for example ...

Guardian  18 Jan 2010

Gulf between rich and poor cities widens

Dermot Finch - Blog

UK cities 'will take years to recover from recession'

Oliver James

Welfare to Workfare

Our immigrants' success is not down to Labour

Cadbury can look after itself. But, at last, Mandelson has seen the light

The business secretary's belated intervention in Kraft's takeover bid for Cadbury is a welcome change of course. We clearly can't rely on investors to defend national interests ...

(Mandelson's) ... move resonates beyond the Cadbury situation, which is symptomatic of the casual way we have allowed household-name companies to be flogged off to foreign buyers.

It marks a belated break with the laissez-faire policy that prevailed throughout New Labour's reign, which saw the UK stock market stripped of ICI, Hanson, P&O's ports, BAA, Abbey National, gas company BOC, glassmaker Pilkington and a long list of others, including energy and utility businesses ...

As Mandelson has suddenly noticed, mainstream investment institutions appear to behave perversely in take­overs.

Mergers are concocted by investment bankers, for the benefit of investment bankers.

Executives go along with them for the chance to boost their empires, egos and bank balances.

Most deals destroy value in the long term, so you would expect shareholders to put their feet on the brakes.

They don't, partly because their minds are on their quarterly performance figures ...

We have a highly diverse and indirect ownership model, where the members of pension funds have little say over, or even knowledge of, the investments made on their behalf.

Many might be horrified if their savings went to back a takeover involving significant job losses, but the institutions managing their money show no inclination to act, possibly because they see themselves as part of the City eco-system rather than as agents of the pension-holding public.

Nagging shareholders won't bring the desired results. Pension funds and trades unions need to be much more active and engaged in what happens to their members' money.

If the government really is concerned with the impact of takeovers on jobs, research and pensions, it should have the guts to take a position on the industries and companies it sees as vital to the national interest, as the French and Germans, and even the Americans, do. It's not enough to leave the job to investors.

Observer  17 Jan 2010

Peter Mandelson

Executives at Britain's top companies saw their basic salaries leap 10% last year, despite the onset of the worst global recession in decades, in which their companies lost almost a third of their value amid a record decline in the FTSE ...

Bonus payouts were lower, but the basic salary hikes were more than three times the 3.1% average pay rise for ordinary workers in the private sector.

The big rise in directors' basic pay – more than double the rate of inflation last year – came as many of their companies were imposing pay freezes on staff and starting huge redundancy programmes to slash costs ...

The average chief executive of a blue-chip company now earns a basic salary of £791,000. However, adding bonus payments, share awards and the value of perks ranging from cars and drivers to school fees and dental work, the average pay package rises dramatically ...

Guardian  14 September 2009

It was FTSE's worst year ever – but not for executive pay

Executive pay: Heads you win, tails you win

Executive pay 'up 10 per cent despite crash'

Construction boss for East London Line said to have made £300,000 by underpaying his men ...

Between April 2008 and March this year, workers on the tube's East London Line extension project were paid as little as a third of the amount Paul Singh was charging for their work, allowing him to amass a profit of more than £300,000. "Singh was getting £155 per man per day for his 15-strong team while paying them around the minimum wage [£5.73 per hour] which allowed him to make around £6,000 per week for himself," said Transport for London spokesman Guy Pitt.

Singh was contracted to provide the staff by Woulfe and Son, a firm sub-contracted by Balfour Beatty/Carillion, the consortium which won the £363m contract to build the first phase of the project. Woulfe and Son has worked on numerous public projects, including the Channel Tunnel rail link ...

Workers the Observer has spoken to on the East London Line site claim Singh's staff were paid as little as £50 per day, which, if true, would have taken their earnings below the national minimum wage. Transport for London says it does not know if the minimum wage rules were breached.

Woulfe and Son failed to alert either Transport for London or Balfour Beatty/Carillion about the gangmaster's activities, which only came to light after the Observer learnt about Singh's operation from other workers on the East London Line site last month.

Construction workers are not protected by the Gangmasters Licensing Authority, set up in 2005. The authority can only investigate gangmasters operating in the agriculture, forestry, horticulture, shellfish-gathering, food and drink processing and packaging sectors.

Alan Ritchie, general secretary of the construction union Ucatt, said the licensing authority's remit needed to be widened and that Singh's activities were part of a wider problem in the construction industry ...

"What the Observer has uncovered is a model we see a lot – complex chains of sub-contractors, agencies and gangmasters involving major levels of exploitation. Until the Gangmasters Act is extended to the construction industry, similar cases will occur. By licensing gangmasters and employment agencies, only companies which meet minimum standards will be able to supply labour, and if they are then found to be abusing workers they can be rapidly stripped of their licences." ...

Observer 06 September 2009

I can't make any sense of the government's attitude to financial risk. When big companies or rich individuals are willing to take it, the official view is that they must be rewarded for having the courage to gamble. That's why PFI schemes are potentially so profitable for the private sector, why bankers still get bonuses, and why profits on share dealings are taxed at less than income. Yet when it comes to the poorest people, the policy now is to push them into taking tremendous risks, with a high probability of loss, and no corresponding hope of tremendous gains.

The welfare-to-work reforms are intended to discourage everyone but the very ill or disabled from leading a life on benefits. Fine, except for two problems. The first one we all know about: as last week's figures made plain, the jobs aren't there.

The second problem is just as serious. Jobs aren't what they were ...

McGoldrick (Community Link) says the majority of benefit claimants are now going into unstable jobs. They may be commission-based, or agency work, or zero-hours contracts. That means the income and hours worked can vary wildly from week to week. Someone on zero hours, perhaps with a shop or a cleaning firm, may have to be available for work at any time over a 40-hour working week. But there's no corresponding requirement on the employer actually to give them anything to do. So a worker may do a three-hour stint one week, 17 hours the next, 32 in the third week, and four hours at the end of the month.

Trying to deal with that sends benefit offices into meltdown. People earning a low wage can still be entitled to all kinds of financial help. But if their incomes fluctuate from week to week, so will their entitlement, and the system can't keep up. Weekly changes must be reported, and it can take weeks for each claim to be processed. Meanwhile, panicking claimants may find that their housing benefit has been cut or suspended, or their jobseeker's allowance withdrawn, on the assumption that what they earned three weeks ago is what they're earning now ...

Guardian  19 August 2009

Retention bonuses back at Merrills

Community Links

Vulnerable Workers

Carer Watch

FTSE 100 chief executives still took home bonuses equal to 90 per cent of their basic pay, despite plummeting profits and dividends at top companies.

Research by the pay consultancy Hewitt New Bridge Street found that the median salary for a FTSE 100 chief executive was £800,000 last year, meaning the bonus would be £720,000 ...

David Tankel, principal consultant at Hewitt, suggest(s) that the recession has done as little to put a break on boardroom avarice as it has on the traditional type of those working on the trading floor.

One hundred public figures have joined a campaign for a High Pay Commission, which they want to act as a watchdog on high City pay packages. It includes figures such as the Labour MP John Cruddas and the Liberal Democrat Treasury spokesperson, Vince Cable.

The campaign, under the auspices of the centre-left Compass Group, calls for steps such as maximum wage ratios and bonus taxes ...

The Hewitt research pointed out that companies failing to act on shareholder concern about pay have been embarrassed.

Shell, the oil major, saw its remuneration report voted down by shareholders in May after tweaking its bonus pay plan so that executives would be paid despite failing to hit targets, in what was the most prominent show of dissent this year.

But such votes have been criticised because they continue to hold only advisory status and do not have to be acted upon ...

The research found that variable pay – made up of an annual bonus and long-term share-based incentives – accounts for about 60 per cent of a FTSE executive's pay, up from 45 per cent in 2003. Some 60 per cent is linked to long-term performance, compared to 50 per cent in 2003.

Independent  18 August 2009

Should there be a commission into high pay

Chancellor Alistair Darling has come out against calls for a new commission to curb "excessive" pay.

One hundred public figures joined a pressure group's campaign for a High Pay Commission, to act as a watchdog over high City salaries.

The centre-left Compass group's campaign called for steps such as maximum wage ratios and bonus taxes.

Mr Darling said he was "not persuaded by that", but criticised the culture of huge bonuses at banks.

The campaign compared the wage levels of the highly-remunerated to those of employees who worked a 40-hour week earning the minimum wage.

It argued someone earning the minimum wage would have to work for about 226 years to receive the same annual pay as a FTSE 100 boss ...

BBC NEWS  17 August 2009

We need our big bonuses or London will suffer

City hits back at Treasury in bonus war

Darling vow on City bonus rules

Bankers defend culture of bonuses

Tories want end of bonus culture

Lack of competition allows mortgage firms to be pickier with borrowers ...

According to Ray Boulger, senior technical manager at broker John Charcol, it is evident that while the government may have rescued the banks, their customers have been left out in the cold.

The credit card slip-up meant one client was forced to accept a smaller mortgage. Boulger says: "There is a lack of competition in the market. There are only six mortgage groups who are active in the market and that is having an impact on [profit] margins."

There is growing public discontent with banks, and the issue is spanning traditional religious divisions, as RBS chairman Sir Philip Hampton discovered last week. He was handed copies of the Torah, the Qur'an and the New Testament by religious leaders protesting about exorbitant rates of interest.

As well as cracking down on City traders' bonuses, they would like to see the government bringing back the ancient laws of usury, limiting how much banks can charge for loans.

Boulger says the impact of a lack of competition has already become increasingly apparent. Before the meltdown, there were up to 100 brands fighting for business in the mortgage market. Now, by his reckoning, the only serious players left are the part-nationalised Royal Bank of Scotland and Lloyds Banking Group, HSBC, Barclays, Santander (Abbey and Alliance & Leicester) and Nationwide Building Society.

The mortgage market is the clearest illustration of the reduction of competition. But in the savings industry, too, the plethora of institutions offering headline-grabbing rates has also shrunk. The collapse of the Icelandic banks, the rescue of the Irish financial industry and the flight of savers to safe institutions has cut the number of savings products on offer.

The withdrawal of some very active competitors has alleviated the pressure on those that remain to fight for customers ...

  26 July 2009

Tories' secret plan for new lending fund

The cost of living for those living on minimum household budgets is rising faster than inflation, the Joseph Rowntree Foundation has calculated.

It says that the costs for a single household on its low-income budget were up 5.3% this year, with rises of 5% for pensioners and couples with children.

The reason is that the poor spend more on fuel, food, and public transport, which have risen by 7% to 12%.

One in four households in the UK fall below Rowntree's minimun income levels.

The report warns that the benefits paid to working age people are well below minimum income standards ...

MINIMUM WEEKLY INCOME STANDARDS 2009
Single person: £166.47
Pensioner couple: £211.30
Couple with 2 children: £388.51
Lone parent with one child: £220.88
source: Joseph Rowntree Trust (excludes housing costs and childcare)

BBC NEWS 30 June 2009

Sharp contraction for UK economy

JRF: A minimum income standard for Britain in 2009

There are campaigners who argue that Britain should deal once and for all with its damaging boom-bust cycle in house prices by reaching for a radical policy known as annual land value tax (LVT), which would be levied on the value of land up to its maximum permitted development value.

The tax would be levied on property owners at, say, 1%, of the land's value every year, with the proceeds used to replace council tax and reduce income tax, thus rewarding work rather than property speculation. LVT would also encourage, for example, an elderly person living in a large family house to move to a flat and free the house for a family in a country where space is limited. It would also discourage developers from sitting on empty sites and buildings.

"This tax-shifting vision would release billions into the pockets of millions of working people and their families to spend and make the economy work for them and not landowners, speculators and bankers," says Louanne Tranchell, chair of the Labour Land Campaign.

LVTs are used elsewhere in the world and the idea goes back at least two centuries. "With the financial crisis, the time is ripe to introduce a system to collect the unearned income from the value of the land, which arises from community activity and services, and through investment in transport and infrastructure funded by the public purse," Tranchell adds.

Observer 14 June 2009

Land Tax

Land Value Taxation Campaign

Labour Land Campaign

A land tax is 200 years overdue

Land Research Trust

Brown's war against child poverty - [BBC] - began well, but went into reverse in 2007. [JRF]

On 30 September 2008, research by The Campaign to End Child Poverty coalition claimed:

... there are 4,634,000 children in England living in low income families, 297,000 in Wales, 428,000 in Scotland and 198,000 in Northern Ireland ... 174 of the 646 parliamentary constituencies in Britain have 50% or more of their child population in, or close to, the poverty line.

The parliamentary constituency with the highest number of children in or close to poverty is Birmingham Ladywood, with 81% (28,420 individuals) ... [BBC2]    [BBC3]    [BBC4]

New Labour has pursued mutually contradictory policies: the social democratic - redistributionist - means of reducing child poverty, whilst at the same time pursuing the Blatcherite policy of meeting the dictates of the Washington Consensus.  [GB]   [WC]

Faced with the fact that redistribution has hit the buffers, New Labour has resorted to the same methods which it has used to combat crime: pass another set of laws, set up another quango, and demand annual reports.

Raising the minimum wage, and raising the tax threshold - to name but two ways in which poverty might be alleviated - are not amongst the proposals on offer.

Child poverty duty to become law

Ministers are making it a legal duty for the government, local authorities and other organisations to help to end child poverty across the UK ...

Under the Child Poverty Bill, a legal duty to work together to support families to end child poverty will be placed on central government, councils and services including the police, NHS primary care trusts and youth offending agencies ...

It sets out four targets to be met by 2020 across the UK, which the government says will "define the eradication of poverty".

These include having fewer than 10% of children living in relative low income poverty (i.e. in households with less than 60% of average).

The bill will also establish a child poverty commission to advise on strategies to tackle child poverty ...

DEFINITION OF POVERTY
Household has 60% of average (median) income, before housing costs
In 2007/08 this was £361 per week for a couple with two dependent children
In 2007/08 this was £283 per week for a single parent with two dependent children

MATERIAL MEASURES
There should be a combination of some of the following for children:
A family holiday for at least one week a year
Enough bedrooms for every child of 10 or over of a different sex to have their own bedroom
Leisure equipment such as sports equipment
Celebrations on special occasions
Swimming at least once a month
A hobby or leisure activity
Friends around for tea or a snack once a fortnight
Toddler group/nursery/playgroup at least once a week
Go on school trips
Outdoor space or facilities nearby to play safely

BBC NEWS 12 June 2009

Bill sets out four targets for action by 2020

Ministers will have to show they are aiming to meet all four targets.

The first is relative poverty, and aims to have less than 10% of children living in relative low income poverty by 2020, defined as households with less than 60% of the median income in society.

The second target is defined as material deprivation, and sets an aim of having less than 5% of children living in combined material deprivation and low income.

The third target will be defined as absolute low income, meaning less than 5% of children living in families with an income below an absolute threshold.

The fourth target is defined as persistent poverty, which will measure the percentage of children living in relative poverty for three out of four years. The measure will be fixed at the end of 2014.

The bill will set up an independent child poverty commission to report on progress, and ministers will be required to produce a strategy every three years and publish an annual progress report ...

Guardian 11 June 2009

Child poverty 'billions needed'

'Millions' of UK young in poverty

CPAG

Joseph Rowntree Foundation

Here's how things stand. The follies of the big banks have caused the ­steepest plunge in output since the second world war. The economy is showing signs of stabilisation, owing largely to emergency cuts in interest rates and taxpayers' billions being used to prop up a financial system on the brink of collapse. Unemployment is rising, and it is rising most rapidly for the blameless, not the wretched bankers.

Even before the recession began, incomes for those at the bottom of the pile were below the level of three years ago. The longer Labour has been in power the slower incomes have grown. Inequality is higher than under Thatcher. Child poverty has increased in the past three years and the public finances are shot to pieces.

According to the prime minister, we are now living in a different world. The crisis of neo-liberalism has ushered in a new age in which there is a new and more important role for the state.

That is true, but only up to a point. The state is rather keener on controlling the people than the markets.

The evidence for this? Well, in the past month, the Treasury has announced that it is "not persuaded" that the most profound financial crisis of the past 100 years should result in reform along the lines of the Glass-­Steagall act of 1933. This is a sensible idea that would cut the banks down to size and create a legal distinction between retail and investment banks.

Meanwhile, the government is pressing ahead with the part-­privatisation of the Royal Mail and made conditions for financial support for Jaguar Land Rover so tough that they were bound to be rejected. This is not interventionism: it is neo-liberalism lite. The aim, as it has been all the way through this crisis, has been to return to Labour's comfort zone – the economy as it was before 9 August 2007.

In other respects, though, the state has bared its teeth. Labour is ploughing ahead with identity cards; it intends to keep the DNA records of innocent people on its database for up to 12 years; it sanctioned the aggressive policing of the G20 demonstrations. Britain already has more CCTV cameras per head than any other western industrialised country and the weakest laws on privacy and data protection. We have a surveillance society and prisons that are bursting at the seams ...

Those of a liberal bent are appalled at the authoritarianism that is apparently required to keep the lid on a society where the gap between material desires and weak income growth has for years been bridged only by debt. Professionals loathe the target culture. Only the functionaries of the Big Brother state remain loyal, and even now there are not enough of them. The party's over.

Guardian 10 May 2009

UK 'failing' on causes of crime

Neoliberal globalisation - 'Pareto efficiencies' - demand that firms like Jaguar Land Rover, Corus, and Linamar, be allowed to close because they have failed in the social Darwinist world of market forces.

But, it seems, ardent neoliberals like Mandelson and Robinson have - like bankers before them - bought into 'Keynes Lite'.  [KL]

For them, market forces are OK for the good times, but when there's a bit of a blip, the despised figure of J.M.Keynes is resurrected, and government - ie the taxpayer - is expected to bail out foreign owners who clearly believe that their responsibilities to their British workers will be shouldered for them by the British government, which is expected to meet redundancy payments, benefits, and the costs of retraining.

Perhaps if British governments since 1979 had not been so eager to flog off the 'the family silver' to all comers; perhaps if British governments had factored social cohesion - and welfare costs - into their decision-making, and their regulatory structures, firms who made profits in the good times would have been obliged to contribute some of those profits when boom turned to bust.

It might, who knows, have made them think more carefully before buying into Britain in the first place.

A final thought occurs in the case of Linamar, where there are echoes of the fate of Blackpool niche sports car firm TVR.

TVR was bought by a Russian oligarch who placed his son in charge of the business. After much talk about expanding the business - leaving the workforce in limbo - the firm closed. Possession of the marque ensured that it could not be reopened by a third party.

Bailing out Jaguar Land Rover

Faced with the possible breakdown of talks between Tata and BERR, Coventry MP Geoffrey Robinson told The Guardian:

... a deal on Jaguar Land Rover must be done: to lose 30,000 jobs is not an option ...

No one believes that the government – with over 30,000 jobs directly and indirectly at risk in an important manufacturing sector – is going to let this negotiation founder in a sea of acrimony and recrimination. This is all the more so in a recession to recover from which the UK economy will desperately need a stronger export-­oriented manufacturing sector ...

Guardian 07 May 2009

Talks on Jaguar Land Rover bailout set up to fail, says Tata

One day later, Tata appeared in the news again, this time in respect of the possible closure of its Corus steel-making plant, at Teeside:

Steel plant could shed 2,000 jobs

Steelmaker Corus is set to mothball its Teesside plant threatening the jobs of nearly 2,000 workers.

Workers at the Teesside Cast Products (TCP) plant in Redcar were told the news ahead of a 90-day consultation.

Owner Corus said the development had become "unavoidable" because of the early end to a contract with four international steel slab buyers ...

Corus said the development was because of the termination of a contract by four international slab buyers which had made the Redcar plant "unviable".

The agreement was signed in 2004 and committed the consortium to buy just under 78% of the plant's production for 10 years.

Those involved in the agreement include Marcegaglia SpA, Dongkuk Steel Mills Co Ltd, Duferco Participations Holding Ltd and Alvory SA.

Corus chief executive Kirby Adams said: "I am extremely disappointed that the consortium members have seen fit to take this irresponsible action.

"Their unilateral termination of a legally binding 10-year contract could bring to an end a fine heritage of steelmaking at Teesside ...

Business Secretary Peter Mandelson said: "It is essential that Corus does everything it can legally, and with the government's assistance, to reinstate the Offtake Framework Agreement.

"It is unacceptable that such a development should threaten jobs on such a scale, with such a potentially devastating impact on the area.

"The government stands ready to do what it can to support the company. We are not prepared to reconcile ourselves to inevitable closure of this plant."

BBC NEWS 08 May 2009

Further away from the mainstream media, jobs at a third foreign-owned manufacturer are also threatened:

Worries over 208 car plant jobs

An automotive plant is calling for 208 voluntary redundancies, according to a union official.

Linamar, which employs 358 people in Swansea, said the exact numbers of job losses were unknown but it faced an "unpredictable and volatile market".

It bought the former Visteon components plant in July with hopes it would lead to expansion ... [Reuters]

BBC NEWS 05 December 2008

However, by December, it seems Visteon were having second thoughts:

A car components factory is planning to shed 208 jobs, a union official said today.

The Canadian-based Linamar, which employs 358 people on the outskirts of Swansea, is looking to transfer some of the work to Mexico, according to Unite regional organiser Emyr Evans.

The company only took over the plant at the beginning of July from Visteon.

Mr Evans said: “There are 200 redundancies in the production sector and eight in the staff sector.

“There is a voluntary redundancy package that is being opened. All I know is that it is due to over-manning and transfer of work from one of the lines to Mexico.”

He added: “It is a huge blow, there is no getting about it. These 208 jobs together with around 150 redundancies which have been announced in Llanelli in the automotive industry takes it to more than 350 in the last three or four months.”

According to the company website, Linamar was started 40 years ago and has grown into a “2.26 billion dollar company”.

It employs thousands of staff at 37 plants across the world ...

WalesOnline 05 December 2008

On 16 December 2008, Linimar shop stewards called a meeting Swansea, where Linamar UNITE convener, Rob Williams ...

... highlighted the success that previous militant action had achieved in the plant over the past 3 years in retaining jobs, pay and conditions against a determined employers' offensive.

This new battle against an anti union employer will be just as difficult but as Rob said "There are no guarantees - If you fight you still may lose but if you don't fight you will definitely lose!

Some of the Linamar workers who spoke were scathing of their full time officials who despite being invited to address the meeting failed to attend. Second hand apologies for non attendance when hundreds of jobs are on the line just confirmed to members how inadequate their full time trade union leadership has become after many years of 'partnership' deals and 'concession bargaining' with the employers.

When it comes to organising a fight back they echo the whimpering excuses of their New Labour partners and say 'It's a global economic crisis - what can we do'? ... socialistparty.org.uk 

During the last week in April, Rob Williams was sacked:

Swansea Union Activist Victimised

It has been noted that Linamar has been steadily laying workers off over the last period; 140 in the last few months alone and have been more than keen to try and weaken union resistance in advance. According to the UKIndymedia site: LINAMAR is a Canadian Multi-National Corporation who on their website describe themselves as 'THE EMPLOYER OF CHOICE', but are known to be virulently anti-union. Working conditions at the Corporations plants in countries such as Mexico and South Korea are said to be appalling and all Union activity is banned. It must have annoyed the Swansea site bosses to see the union standing up for decent conditions for the workers there ...

socialist.net 30 April 2009 socialistworker.co.uk

Rob Williams sacked by brutal bosses

Step up the struggle

Rob Williams, trade union Convenor of Linamar Swansea, was sacked by the Linamar management last week, and then temporarily re-instated following militant action by the Linamar workforce.

Disgracefully, however, Rob today had his sacking confirmed. Negotiations between Linamar management and Tony Woodley took place all day in London, but Linamar did not shift.

Meanwhile at the Swansea plant Linamar revealed their brutality. Massive intimidation of the workforce took place - including foremen going around the shop floor threatening workers with the sack if they dared walk out in support of Rob. The bosses even went to the ludicrous lengths of removing the door from Rob’s trade union office.

This brutal action by Linamar is an attempt to return to the nineteenth century. What Linamar do not realise, however, is that all hell is going to break loose when workers, both in the Swansea and the wider labour movement, hear how Rob and his members have been treated.

The official reason for his sacking was “irretrievable breakdown of trust” - one of the most blatant excuses to behead a trade union organisation ever used in any factory. Rob’s record in standing up for his members, both inside and outside the factory, is second to none. However, what is at stake here is not the fate of one individual but the right for workers to be represented by the best militant fighters.

This sacking has to be totally opposed. The union has promised rapid action to organise a ballot for an official strike, but the anti-trade union laws mean this could still take up to a month between the ballot and the strike action actually taking place. That time, which must be kept a short as possible, needs to be used to pull out all the stops in support of Rob. Messages of support and donations should flood in.

If Linamar are allowed to get away with this, no convenor or shop steward, either in the already weakened car industry or in the wider trade union movement is safe. Allow the employers to inflict a defeat here and no trade unionist, shop steward, let alone a convenor, will be able to put their head above the parapet without the bosses seeking to cut it off.

Workers are facing the worst economic crisis since the 1930s. Big business is doing their utmost to make sure that it is the working class that pays for the crisis. Militant, fighting trade unionism – symbolised by Rob Williams and the union organisation in Linamar – must not only be preserved but strengthened in order to prepare the working class for the capitalist offensive that is under way in Britain and worldwide.

Update

It has become clear why Linamar management sacked Swansea Unite Convenor Rob Williams on Wednesday. Group President Brian Wade outlined to Tony Woodley the Company's 'proposal' to lower terms and conditions within the plant.

This will involve 'buying down' (worsening) contracts with a one off 'sweetener' payment. There is no detail of amounts yet but it is clear that it will involve a substantial drop in wages, worse sick scheme etc. Also, the Company announced that they fully intend breaking the agreement that they made with the union when they took the factory over last July of establishing a final salary pension scheme for those Ford-mirrored workers who were in the plant before Visteon spin-off in 2000 and the Visteon New Hire contracts who were subsequentoy employed later. He pretended to be concerned about the lack of a pension for the lowest tier in the plant - yet Linamar refused the union's call for them to get a pension last summer!

Therefore, the timing of Rob's sacking is of no surprise. It comes a week after 140 workers were made voluntarily redundant, including a number of senior stewards and before the pay deals are concluded for two of the three contracts. Incidentally, one of the last straws could well have been when the Ford-mirrored members refused Wade's 'offer' to refuse the 5.25% Ford pay rise. This has always been seen in the Plant as the yardstick for all contract negotiations.

Clearly, Linamar correctly had no confidence that Rob would recom m end these attacks to the members. Now the choice for Swansea workers is clear - fight the sacking of Rob and defend their terms and conditions and pensions and their right to work in a place free of intimidation or face a future of attack after attack. In Canada before Christmas all but one Linamar Plant had their pay cut by 10% by email!! The only plant that didn't suffer this was unionised. Sooner or later, bullies like Wade and Linamar will be confronted by a workforce, tired of being pushed around and walked over. It will inevitably happen, in Canada, China or Swansea. With its great fighting traditions, Swansea workers could be in the forefront of defending their rights.

Copy of email from the Socialist Party, Fri, 8 May 2009 15:48:37 +0000

BERR, now run by Lord Mandelson, functions as a fifth column within government, working for corporations to undermine democracy and the public interest.

Since he became business secretary in October, Mandelson has been quietly building a bonfire of the measures that protect us from predatory corporate behaviour.

You don’t have to look very far to see where BERR’s interests lie. Most government departments contain either one unelected minister or none. Two departments (the Foreign Office and Innovation, Universities and Skills) each accommodate two unelected ministers.

But BERR has four. It is the only department of government in which unelected ministers outnumber members of parliament.

Until he became minister for communications in BERR, Lord Carter was the chief executive of Brunswick Group, a big corporate PR firm whose clients include British Airways, Barclays, Unilever, Rolls Royce and BT.

Lord Davies, the minister for trade and investment, was chairman of Standard Chartered and a non-executive director of Tesco. Until October, the trade minister was Digby Jones, formerly the director-general of the Confederation of British Industry. Lord Jones refused to join the Labour Party, or to say which party he would support at the next election.

As for Lord Mandelson, who was twice obliged to resign from the government and who previously ranked second on Mr Brown’s execution list, the only convincing explanation for his appointment is that business demanded it.

Mandelson, who once avowed that “we are intensely relaxed about people getting filthy rich” was partly responsible, both in Blair’s government and as European trade commissioner, for promoting the culture of deregulation that catalysed the economic crisis.

Yet even today he boasts about “a decade of reform that has given the UK the most open and flexible product and labour markets in the world.” ...

Mandelson is the promoter of Labour’s crazy scheme to part-privatise Royal Mail ...

But most of his assaults on democracy have achieved much less attention.

Last week he helped to neuter the EU’s working time directive by ensuring that European companies will still be able to push their employees into working for more than 48 hours a week.

BERR issued a gleeful press release bragging that talks on the directive “have broken down without agreement being reached” as a result of government filibusters.

Mandelson’s attempt to prevent companies from exploiting their female workers was less successful. The equality bill sought to audit large companies to ensure that they were not paying women less than men for the same jobs. Mandelson insisted that the audits should be voluntary, and that the policy should first be approved by the Confederation of British Industry ...

Last month, though it passed almost unnoticed, BERR deregulated the news distribution industry. This is a gift to the supermarkets, but a disaster for both small newsagents and freedom of speech.

The companies which distribute newspapers and magazines to the shops had guaranteed, in return for exclusive delivery rights, to supply whatever stock a shop requests, however small the order might be. This allowed small newsagents to survive, and protected publishers from censorship by powerful retailers ...

Tesco has been trying to break the distribution agreement since 2000; now Mandelson has delivered ...

Monbiot.com 04 May 2009

... there is evidence to prove that free trade has not served well the richest economy in the world.

The US showed remarkable growth together with a rise in real wages for a majority of its population up until the late 1960s.

This was a period when the US manufacturing industries were in good health and were still protected from foreign competition by tariffs (taxes on foreign imports). Since 1973, however, when it turned to quasi free trade, the country has seen declining levels of real wage for around 80 percent of its workforceas high wage manufacturing sector jobs have been replaced by low wage service sector jobs.

The benefits of free trade have only accrued to the owners and CEOs of large multinational corporations which have been able to outsource production to low wage countries. Of course there has been overall GDP growth but that says nothing about how the benefits of this growth were distributed. Besides, the current financial crisis bares for all to see how consumer demand during the recent years was built upon the foundations of unsustainable debt.

Many free trade economists argue that the consumers benefit the most from free trade since it lowers the costs of goods and services. These economists forget that the same consumers are also workers and wage earners. If they lose jobs due to decline in manufacturing and increased outsourcing or are forced into low wage sectors of the economy due to free trade, their purchasing power is reduced. For one who suffers wage loss in tandem with falling prices there are hardly any benefits from free trade to brag about ...

openDemocracy 13 April 2009

This recession will hasten the shift to a new economic world order

Goldman Sachs predicts Indian incomes to become world-class by 2030

Free trade – or fair trade?

The ultimate objective is to merge all the existing regulatory agencies into a single Fair Trade Authority, which would be formally responsible to parliament and which would intervene only to ensure free, competitive markets. A great deal of the regulation aimed at protecting the consumer could be left to the courts, while the greater use of market mechanisms, such as mandatory insurance, would serve to improve standards.

The briefing goes to point out - validly - that UK regulators failed to prevent:

... the corporate governance shocks at Shell and Equitable Life ...

but also goes on to assert that:

... Regulation is typically part of the problem, not the solution ...

Adam Smith institue

The broad-brush recommendations that regulation should be very largely a matter for insurance companies and the courts suggests a rather optimistic view of the "balance of power" between business and what President Franklin Delano Roosevelt called "The forgotten man (sic) at the bottom of the economic pyramid", and might be thought to be more about shrinking government than enhancing economic rights.

Joseph Stiglitz confirms the 'balance of power' problem when he talks about distortion of the market by "asymmetric information" - dir.salon.com

The response of both public, and private, bodies to the scale - and the future implications - of the 2007 flooding disasters reinforces my point.

A manifesto - from a currently non-existent party - pledging reform of the workings of the NeoLiberal Agenda would be rubbished by both main parties - and the mainstream media - which would effectively frighten off potential voters who, I must point out, have never had this agenda put before them.

Like most previous revolutionary changes, globalisation was a top-down scheme implemented in dribs and drabs out of sight of ordinary voters.

As Jeff Faux has pointed out, the beneficiaries of these changes - members of the so-called "global investor class" - are now outside the control of the nation-state, which means outside the clutches of its tax system.

The scandal of the "off shore" tax havens was attacked by The Independent's columnist Johann Hari who makes practical proposals for their closure.

These have as much chance of being implemented in the foreseeable future as the draconian measures needed to get nations like China, India, and the USA - EU nations are supposedly already taking steps (?!) - off their addiction to fossil fuels.

The reasons are the same in both cases: the living standards of the current globalised society are enmeshed in the belief that "growth" - and consumerism - are the natural order of humankind and that the technical progress which makes these possible brings in its train comparable social and personal progress.

That is to say that somewhere in the near to medium-term future, a world without poverty and ill-health, but above all a world without conflict will emerge.

Curiously, the current wars in Afghanistan, Iraq, Lebanon and Palestine are seen as necessary to bringing about such a world. For the bedrock of such a belief system has been borrowed from the Romantic Left: the belief that the right ordering of society will make conflict redundant.

Such a worldwide experiment in social engineering is without precedent, as John Gray has pointed out. [BM]

Quite how a world without conflict could emerge from a system driven by the intensity of competition espoused by both corporate, and 'cultural' America remains to be seen.

The Anglo-American model of ruthless individualism - the search for status-wealth as life's only valid pursuit - is driving humanity towards catastrophe. [Threat to Humanity]

Voices raised against this likelihood are either in denial, or living in the hope that some spectacular innovation will restore "business as usual".