On Wednesday 8 July, the government of Boris Johnson in the person of Chancellor Sunak Rishi, announced that the government will make available £2bn pounds to mitigate the economic and social crisis caused by the Coronavirus.

By Etiandro Costa

The government admits the following on the gov.uk website. The global economy will contract by 4.9% in 2020, according to the International Monetary Fund (IMF). The World Bank analysis suggests this will be the deepest global recession since the Second World War and the broadest collapse in per capita incomes since at least 1870. The UK is exposed to contractions in global demand.[i]

But the Bank of England forecasts a 14% slump in GDP this year and a potential rise in the unemployment rate from 3.9% to 15%, according to the Organisation for Economic Cooperation and Development. This is mass unemployment in the time of mass precarious work.

Sunak Rishi says we have a bold plan to protect, support and create jobs, a plan for employment.

One of the government schemes is the  “Plan for Jobs”. But is it a plan for jobs? The plan scheme is only for six months. It is a short-term gap to stop an immediate explosion of unemployment as Furlough for more than nine million workers comes to an end in October, Universal Credit (UC) had 3.4 million individual claims made from 1 March to 23 June. By July another 700,000 school leavers and university graduates will be looking for work. That means over 12 million jobs have to be guaranteed.

 

Kick start or kick in the teeth?

In the first two months of the blockade, the number of young people who applied for Universal Credit rose from 250,000 to almost half a million young people, and it is to these young people that Boris and his friend Sunak are forcing them to go on short term work.

Part of the “Plan for Jobs” is to employ up to 350,000 young workers, which is the so-called “Kickstart scheme”. “… a £2bn fund to create hundreds of thousands for 6-month work placements aimed at those aged 16-24 who are on Universal Credit and are deemed to be at risk of long-term unemployment. Funding available for each job will cover 100% of the relevant National Minimum Wage for 25 hours a week, plus the associated employer National Insurance contributions and employer minimum automatic enrolment contributions.” www.gov.uk.

The employer therefore pays nothing for six months they get free labour, but the young worker does not get a full-time job just 25 hours per week. After six months even that part-time job is not guaranteed.

For someone under 18 the minimum wage is £4.55 an hour for, £6.45 an hour for 18 to 20-year-olds and £8.20 an hour for 21 to 24-year-olds. While employers get the offer of fee labour.

The government and many commentators say that the previous scheme introduced in 2009 after the financial crash in 2008 “Future Jobs Fund” was very successful. What were the results?

“On average, just 2.1% of those on the Work Programme found and kept jobs for more than six months.”[ii] They say further that “Private and voluntary sector companies are paid ‘by results’, receiving the bulk of their income for placing the long-term unemployed into work and for keeping them there for more than six months.” Like the old, the new government plan leads to nowhere, except into a massive expansion of casual work and low paid work.

These young people will serve as a legion of goodwill from the government to the private sector, as the public treasury will pay 100% of the wages of these workers and as a prize, the government will give £ 1000 to the bosses for each work they receive for free.

If the Johnson government thinks that young people are a burden on the finances, do not forget that they are not doing them any favours and they should not be forced to go. But the unions must turn to organise the youth otherwise they will be left to the whims of the government and bosses.

Sunak also announced a ‘jobs retention bonus’ for employers who bring furloughed workers back into employment.

Are these measures sufficient to overcome the jobs crisis that is looming from the economic slump, which many say will hit Britain the worst of any EU country? We do not think so.

Financial confetti for the bosses

The government will introduce a one-off payment of £1,000 to UK employers for every furloughed employee who remains continuously.

There will be payments for employers who hire new apprentices – The government will introduce a new payment of £2,000 to employers in England for each new apprentice they hire aged under 25, and a £1,500 payment for each new apprentice they hire aged 25 and over, from 1 August 2020 to 31 January 2021. These payments will be in addition to the existing £1,000 payment the government already provides for new 16-18-year-old apprentices.

The government will provide an additional £111m this year for traineeships in England, to fund training for 16-24-year olds. The government will fund employers who provide trainees with work experience, at a rate of £1,000 per trainee.”

It would be surprising if the Johnson administration did not continue to harass the British working class. At the beginning of the pandemic, the government made £400bn available to fight Covid-19, however, only £5m was destined for the health sector, the biggest slice of this cake went to banks and companies, but after all was the £400bn to fight covid-19 or to “save” banks and companies?

 

The TUC

The TUC general secretary, Frances O’Grady, said: “Unions have been pushing hard for a jobs guarantee for young workers who lose their jobs during this crisis.”

“The chancellor has made a good first step. But we’ll be checking the small print to ensure every job provides proper training and a bridge to steady employment.”

She pushes hard by reading the small print (?!). If the government attacks young people in this way it is because it has been made easy by those who should be on the side of young workers and should be fighting in the defence of their interests.

The government talks of jobs but not what type of jobs, they mention “high quality jobs” but who trusts this government to fight for the young people?  If the government wanted to rebuild the economy for the benefit of workers, they would outlaw precarious work, and return full trade union rights to workers.

Frances O’Grady makes no mention of the previous experience of job creation schemes that helped make cost cutting measures on workers’ conditions and wages and she says nothing about the anti-trade unions laws.

Unions must fight to take control of the hiring of young people to fight for their rights at work. Health and safety for workers this year especially in health, construction, food processing, transport and security had less priority than maintaining production and profit and became death traps. Capitalism and Johnson’s government failed this year to prepare and protect the most vulnerable workers. Employers in the news scheme will have the right to discipline and hire and fire at will, there is no need to check the small print.

After the words of support for Black Lives Matter how can Frances O’Grady say the Chancellor has made a good first step? There is no mention of how discrimination of BAME people, women and LGBTQ+ will be eradicated.

Will the government scheme be used by employers to replace existing workers? Workers should have no confidence in this scheme unless it is controlled by their union organisation in the workplaces.

Therefore, the British working class has to organize independent of the leaders of old organisations, so that it is in a position to face the difficult days that may lie ahead.

Unions should fight for jobs for all, that is a policy to call and fight for permanent jobs with a reduction of working hours without loss of pay and end precarious work.

Mass unemployment will happen unless we fight the government.

But if we build unity in struggle, the united British working class will win, march forward comrades!

We say to guarantee a future for young workers and all workers:

  • Increase the minimum wage to 12 an hour, 15 an hour in London.
  • Trade union rights for all young workers
  • Rank and file control of government work schemes, health and safety inspections
  • No discrimination, end precarious work
  • Nationalise all big manufacturing, processing, farms under workers control.

[i] https://www.gov.uk/government/publications/a-plan-for-jobs-documents/a-plan-for-jobs-2020 and related websites.

[ii] https://www.instituteforgovernment.org.uk/blog/non-payment-non-results