The recent appalling unemployment figures are just the latest damning evidence that the Budget today should focus on urgent measures to create jobs and growth.
The continuing failure by chancellor of the exchequer, George Osborne to realise the error of his ways and wean himself off his austerity addiction has meant that Britain still faces the prospect of a recession and a 1980’s scale of joblessness for years to come.
The fact that the credit-rating agencies have been circling with gloomy predictions that the UK won’t hold on to its triple A rating undermines the whole Osborne strategy of London being a safe haven for funds to finance the deficit.
What Unite, as the largest union in the country representing members in both the private and public sectors, is proposing in the Budget can be divided into three distinct areas: growth and jobs; wage and tax justice; and fairness at work.
Unite has consistently argued for this package of restorative measures, based on well-tested Keynesian principles; and many economists, not all on the Left, agree with Unite that these measures are vital to kick-start the economy in 2012 and beyond.
Unite calculates that the average worker has lost about £83-a-month because of the coalition’s policies on tax, pay freezes and the soaring cost of household bills. Money, so vital for keeping the shopping centres and High Street alive economically, is being drained from peoples’ wallets and purses.
This month’s jobless figures revealed both a ‘lost and forgotten generation of unemployed’ which makes a Budget for growth essential.
Not only are there unacceptable levels of 18-to-24-year olds unemployed – the ‘lost’ generation – there is the ‘forgotten’ generation of those being made redundant over the age of 50. Women have been particularly hit, according to the latest Office of National Statistics’ figures.
While the Prime Minister tucked into Bison Wellington with red wine reduction during a state dinner in Washington, some residents in prosperous and elegant Salisbury are now reduced to queuing at food banks.
As a first step, the government needs to stop the cuts, thus preventing more than 1.3 million people losing their jobs. This should be coupled with stopping the real terms cut in public sector wages and boosting the spending power of public sector workers with the positive knock-on effects for local economies.
There needs to be a concerted effort to invest in UK industry and infrastructure, such as investing £6bn over two years and building 100,000 extra social and affordable homes, creating new jobs in construction and the supply chain, as well as meeting desperate housing needs.
We need to establish a National Investment Bank, perhaps using our stake in the part-nationalised banks or significantly boosting the Green Investment Bank, to support investment in housing, transport and renewable energy.
In terms of tax justice, the government should announce short term tax cuts to stimulate spending, including a cut in VAT and tax cuts for low and middle income groups and close the tax loopholes that allow the very rich to avoid and/or evade paying their fair share (estimated by Tax Justice Network at £95 billion a year).
A ‘Robin Hood’ tax on all city financial transactions (a tax of 0.05% could raise £20bn a year) needs to introduced, along with minimum tax rates of 40% and 50% on incomes above £100,000 and £150,000 respectively (raising £14.9 bn).
Employment protection legislation is not a barrier to growth, but promotes stability over the economic cycle. Mervyn King, governor of the Bank of England, has said that slashing workers’ rights will not boost the economy. Osborne should avoid the temptation to meddle in this area to appease his rabid backbenchers.
Unite argues that these are sensible – not revolutionary - measures and will gain the support of millions of working people and their families. Osborne must jettison his dogged view that this government of the rich remains committed to helping those that they most identify with – the rich and the powerful.
The British economy remains in the last chance saloon when it comes to economic recovery, hoping with increasing despair for decent economic, political and financial leadership.