Pay, the fightback... and how much do you spend on your horse?

Issue section: 

Many workers are gaining confidence to join the resistance to pay cuts and privatisation. Charlie Kimber assesses the pressure on Gordon Brown from below.

The fallout from the tremendous strikes and rallies on 24 April is continuing. Those who struck then are debating doing it again. Some of those who did not strike are discussing getting involved. And many others look on, wishing their own union leaders could be won to such action.

Gordon Brown's oft repeated determination to hold pay rises for 6 million public sector workers at half the rate of inflation must have lost Labour piles of votes on 1 May. But Brown shows no signs of backing off. This confrontation is a central economic and political issue. It poses the fundamental question of 2008: will workers agree to let their living standards be cut in order to bail out the bosses, the bankers and capitalism?

Over 400,000 strikers on 24 April gave a resounding message that they won't see their pay cut without a fight. The strikes reflected feeling over lack of staff, the penetration of private interests into the public sector and the oppressive power of management. But the main unifying issue was pay.

Now the chance exists to recreate that day on a higher level. Around 800,000 local government workers in Unison rejected their 2.45 percent offer and are now voting in a strike ballot. The initial indications are that the first strikes could be in early July. Teachers are discussing a further strike ballot in the autumn.

The 100,000 civil service workers who struck on 24 April could also strike again. July will see the 80,000 workers in the Department for Work and Pensions face the second year of an imposed deal which means 0 percent for 40 percent of the workforce.

At its conference the whole PCS civil service union backed a motion calling for a national strike ballot of 280,000 members over pay and other issues. Further education lecturers have agreed further strikes - in London on 9 June to coincide with the TUC lobby of parliament, and two days nationally in September. And at the CWU conference postal workers are to debate calling a national strike ballot over pensions. And there's also a fight in the private sector - over pensions at Grangemouth and with Unite promising a real challenge over pay on the London buses.

But for the revolt to come to fruition it will require a political battle at every level. Unfortunately the left lost its move for another ballot for a strike this summer at the NUT executive. After the May elections one section of the trade union leaders will demand that there are no strikes in case the government is weakened and the Tories benefit.

In some unions, especially those affiliated to Labour, there is heavy pressure from the top to damp down any fight. But even here the feeling from below has forced strike ballots.

Those who continue to argue for surrender ignore the fact that workers should only be loyal to a government that is loyal to them, not one that cuts their wages and privatises services. If the left does not give a focus to the anger against Labour then it is precisely the right that gains. This is the lesson from the 1970s.

A union movement that is hobbled and demobilised will be one that is demoralised enough to let the Tories in. Over the next few weeks there needs to be intense rank and file pressure to compel union leaders to call ballots, to win those ballots and, as far as possible, to secure coordinated action between unions.

And inside the unions' national and section executives the left needs to insist that the members' interests come first, not the interests of Labour ministers or the career prospects of Gordon Brown.

Fixing the figures

Galloping inflation is the major factor driving the pressure for a fightback over pay. Britain's rate of inflation rose to 3 percent in April, well above the pay increases offered to millions of workers in both the public and the private sectors. And the real rate of inflation for ordinary people is rising at least twice as fast as the official figures show.

The more accurate Retail Price Index (RPI) rate of inflation rose to 4.2 percent in April, up from 3.8 percent in March. But official figures released on 13 May showed food up 7.2 percent, household energy up 8.3 percent and transport fuel up 18.7 percent.

More detailed analysis shows spaghetti up 59 percent and baguettes up 23 percent. A basket of typical food essentials was up 19.1 percent on a year earlier.

Worse is to come. Wholesale price inflation, which is an indicator of future price rises, was up 6.2 percent in April. Gas and electricity prices are set to go up a further 15 percent this year, another harsh blow for those who are already struggling with the average bill of more than £1,000. No wonder that on 14 May Bank of England governor Mervyn King said, "There will be a squeeze on living standards over the next couple of years."

One traditional response when the figures look bad is to leave reality untouched, but to try to fix the figures. This is certainly happening. In the spring the Office for National Statistics added fees for stabling horses to the goods whose prices it measures to work out inflation.

Maybe there are millions of workers out there for whom this is a crucial component of their monthly budget. But I reckon it won't be much consolation as your food bill goes through the roof to know that some chief executive's dappled grey is still getting its board and lodging at a bargain price.

And while inflation rises, unemployment is also going up. One study in mid-May estimated that 1,200 people will lose their jobs every day over the next 18 months. Unemployment has been rising for the last three months and reached 1.6 million in March.

Meanwhile around 2.5 million credit card customers have had restrictions put on their accounts as part of the fallout from the "credit crunch". While most banks continue to make record profits, they have cut customers' spending limits, brought in annual fees and even closed accounts.

Those targeted are not those who use their cards indiscriminately. They are those who don't bring enough profit. Many use their cards rarely and pay off the balance in full every month.

A uSwitch survey found that 51 percent of the targeted customers were using their cards regularly and making at least minimum repayments. A further 20 percent were using their card regularly and paying their bill in full. Just 16 percent had exceeded their credit limit in the last year or missed more than one monthly repayment.