Category Archives: Finance
Birmingham Council adopts the government’s austerity agenda: asking the low paid to accept even lower wages
In July, Birmingham City Council reneged on an ACAS-mediated, cabinet-approved agreement between the Unite union and Birmingham’s talented Council Leader, John Clancy, which was to end the seven-week refuse collection dispute.
And when BCC reneged on the Unite/Clancy deal, they also issued redundancy notices to the Grade 3 workers. These were later banned in the High Court when Mr Justice Fraser spoke at length about the “extraordinary” and “astonishing” state of affairs at Birmingham City Council with “chaos” between senior personnel. Read more about his reflections here.
Council leader Ian Ward (left) told a BBC reporter: “The cost of the (three month) dispute, yes that’s cost in excess of £6m”.
This ‘new’ version of the original deal (details here), described by union insiders as a ‘total climbdown’, was agreed at a special meeting of the BCC cabinet on Friday.
ITV reports that yesterday Birmingham bin workers voted to accept the council deal.
So a seven week dispute was allowed to go on for three months, regardless of health and safety implications, losing £6m of ratepayers’ money – and the wrong head rolled.
From ‘Our Birmingham‘, under another title.
The presenter of this BBC radio programme, Adrian Goldberg, grew up on the Druids Heath council estate in Birmingham, the home of the ‘municipalism’ pioneered by Joseph Chamberlain when he was Mayor of Birmingham – summarised by Walsall MP John McShane in the Commons in 1930:
“A young person today lives in a municipal house, and he washes himself … in municipal water. He rides on a municipal tram or omnibus, and I have no doubt that before long he will be riding in a municipal aeroplane. He walks on a municipal road; he is educated in a municipal school. He reads in a municipal library and he has his sport on a municipal recreation ground. When he is ill he is doctored and nursed in a municipal hospital and when he dies he is buried in a municipal cemetery.”
Adrian is described as being an ideal candidate to judge the changing nature of the local council, because when he and his family moved there the local authority:
- built properties and
- collected the rent.
- Adrian took a council-subsidised bus service to
- the secondary school run by his local education authority.
- On the way home he’d drop into his council-run library to pick up some books
- or take a swim in the council run pool.
He comments, “Today the situation is much more complex”
Adrian considered the effect of austerity on the role of councils today. Birmingham council has almost halved its staff since 2008, from around 24,000 to 12,500. Last year another £28m was cut from Birmingham’s adult care budget of £230m. 2017/18 – the seventh year of cuts – is predicted to be the toughest year yet with expected reductions of £113m to the council’s overall budget, on top of £650m already cut since 2010.
Local government grants and powers have been greatly reduced in several areas, including education and housing. Read more about the following cases here.
- The fate of the formerly successful council-run Baverstock Secondary School in Druids Heath
- The group of residents who set up the Friends of Walkers Heath Park in November 2011
- The volunteers who are helping to run the library
- Druids Heath’s handsome and historic Bells Farm community centre (below), with its food bank and other services, also kept going by local volunteers.
The link also leads to news of high-rise tower blocks in the area; dilapidation, damp and fire hazards go unremedied, the splendid concierge system was abandoned and full time neighbourhood office advice centres, closed in 2006, were replaced by a private call service which was expensive, often not answering, with staff unable to supply the information needed.
In Birmingham there was a move under John Clancy’s leadership to take back ‘in-house’ the services currently undertaken by profit-making private companies, deciding not to renew one Capita contract and considering the future of refuse collection in the city. This, because the ‘market place’ economy which has developed, privatising refuse collection, road maintenance and ‘back office’ functions in Birmingham, has proved to be more expensive and often less efficient. This hope is fading as Richard Hatcher reports on the new regime: Birmingham Council Children’s Services contracted out, Children’s Centres closed.
The health and safety of council tenants is evidently not a government priority
Inside Housing reports the housing minister’s description of sprinkler systems for high rise blocks as “additional rather than essential” and refusing a council’s request for funding promised after the Grenfell Tower tragedy.
Strangely, the conservative Prime Minister expresses admiration for Joseph Chamberlain
Mayor of Birmingham in 1873, city MP in 1876, Joseph Chamberlain directed the construction of good housing for the poorest, libraries, municipal swimming pools and schools. Unlike Ms May and colleagues, he was not in favour of a market economy, arguing for tariffs on goods from countries outside the British Empire. He was also an ‘economic interventionist’ (see Lewis Goodall, Newsnight), described as a “gas and water socialist”. He took profit-making private enterprises into public hands, declaring that “profit was irrelevant”.
Ms May’s government continues to implement a series of cuts affecting the lives of the country’s poorest and most disabled with might and main.
Ironically the contemporary politician sharing Chamberlain’s principles is the opposition leader, Jeremy Corbyn, whose policies she echoes but does not implement.
Today The Times reports that the chancellor is considering slashing the annual tuition fee universities can charge to £7,500, in this autumn’s budget, after young voters swung behind Jeremy Corbyn when he pledged to abolish fees if in government.
In 2008 student loans were removed from protective legislation, by Section 8 of the Sale of Student Loans Act and the Conservative-led coalition increased fees to a maximum of £9,000 a year from the 2012/13 academic year. Fees charged by English universities are now capped at £9,250 but can rise with inflation from this year.
The political/public argument
At the time, minister Alan Johnson said “There is nothing progressive about working people, many of whom will get nowhere near a university, cross-subsidising mainly middle-class students to have a completely free higher education.”
The political/corporate argument
As the FT’s Miranda Green and Alice Hancock report, since the first graduate contribution the UK has stayed high up the international university rankings, with a ‘lucrative higher education export business’, as imposing new buildings spring up on campuses, student flats proliferate and vice chancellors receive average pay packets of £277,834.
Alongside this boom in construction and salaries however, doubts are being raised about the quality of tuition and the content of many degrees now being offered. A comparatively mild one came from Alice Hancock: “In all the discussion over price, there has been little talk of product. I’m happy to make my monthly donation towards my education: it led me to a better job. But I attended a university where I received an average of 15 hours of tuition each week, much of it one-on-one. This is far from commonplace”.
To pay for this expansion, interest rates on student loans are now three percentage points above the retail prices index of inflation; from this autumn they will carry 6.1% interest – more, as Estelle Clarke, Advisory board member of the Intergenerational Foundation points out in the FT: the Student Loans Company ‘hidden in the small print’, charges a monthly compound interest rate of 6.1% . . .
“It ensnares many student/graduate borrowers in a debt trap. . . Less well-off students suffer twice as much with these punitive costs if they have maintenance loans as well as tuition fee loans. For, instead of having loans of roughly £30,000 (tuition fees), their loans will be roughly £60,000 (tuition fees and maintenance loans). Imagine the monthly compounding interest cost on that at 6.1%!”
She adds: “I believe that if more understood what education costs our graduates, monthly compounding rates would have been confined to the dustbin of immoral exploitation. Were student loans regulated, neither punitive compounding interest rates nor inadequate explanations by the SLC would be tolerated”.
Jeremy Corbyn’s £11bn pledge has proved appealing but the FT journalists fear that if he were to act on it in power, a booming, world-class higher education sector would be plunged into financial crisis.
As it is the 99% will pay for government’s corporate-friendly decisions
If, as the Higher Education Policy Institute projects, 71% of students will never repay loans, who will eventually repay the costs of the campus buildings and student flats? The Telegraph quotes Nick Hillman, director of the institute refers to this as a “very substantial” subsidy from future taxpayers to higher education which is “concealed in the system”.
The Institute of Fiscal Studies’ report explains that if graduate earnings are 2 percentage points lower than expected, the long-run government contribution increases by 50%. It calculates that in the long term the government (the taxpayer) will foot the bill for unpaid student loans, which are written off after 30 years: “the expected long-run cost to the taxpayer of HE for the 2017 cohort is £5.9 billion”.
As economist Alison Wolf argues in her 2016 report, many disadvantaged young people would be better served by funding one or two-year high-quality technical courses — or better early years education. But the political corporate alliance would see little profit in doing this.
Will universal credit be ranked with the poll tax, the invasion of Iraq, Gordon Brown’s removal of the 10p income tax band and George Osborne’s cuts to disability payments?
“Mr Gauke, Secretary of State for Work and Pensions talks of the value of employment — in principle, this must be right — but in practice, again, at the food bank in which I work many of the customers I see each week are in work, but the costs of rents, transport, energy, children, wipe out earnings before food and the only place to go for food is us . . .
“To read David Gauke, on the subject of UC, you would think that the introduction of universal credit had been a smooth, well thought through project. In fact, it must rank as one of the worst executed policies any government has attempted . . . “ Jenni Russell of the Times writes in more detail (edited extracts):
The system aims to simplify the complex welfare system by combining six different benefits, from housing to tax credits to childcare to jobseekers’ allowance into a single payment, ending the benefits trap and ensuring that work would always pay more than welfare.
After seven years of development, a pilot project of the universal credit is under way. It has gradually expanded so that now almost 600,000 people are receiving it. In October about 50,000 people will be moved on to the scheme every month. But UC is not meeting its own six-week target. The DWP says that 20% of claims are paid late, and Croydon reports that 12 weeks delay is standard.
The length of time a new claimant must wait to be paid in full has tripled, from two weeks to six or more; it takes at least five weeks for the first payment to arrive forcing people into debt and creating ‘tremendous anxiety’. Most people have not saved enough to keep them going for six weeks. When their lump sum finally arrives, they are often forced to spend money intended for rent on living costs or loan repayments instead. Some families are using food banks and some have been evicted. In Croydon, one of the pilot area, the council told the select committee on work and pensions that under UC rent arrears had rocketed from under 10% to at least 40%. Ms Russell adds that even the emergency loans for which some people would qualify are little advertised and harsh to repay.
Reasons for the delay include:
- people are asked for the wrong information,
- documents get lost,
- dreadful computer breakdowns (RS),
- huge overruns in costs (RS)
- unexpected requirements, such as the demand that childminders are asked to provide statements of charges on headed notepaper as if they were City law firms.
Jenni Russell believes that a revised UC could work well and prove beneficial. To this end she advises government to:
- scrap the first week’s wait,
- enhance grants and loans for those in need,
- provide proper support
- and commit to paying everyone the benefits within five weeks.
This must be given priority for the sake of people whom Richard Smerdon sees living ‘at the sharp end, the claimants themselves’. He continues: “They suffer unbelievable privation and unfairness dealing with the cock-ups from central government through to jobcentres. In addition to that is the monstrous rule that no one can claim universal credit for seven weeks after they have ceased to draw existing benefits. So for seven weeks, many of the customers coming to the food bank in which I work would starve were it not for us . . .”
The Education Secretary Justine Greening has now ordered a major review of council policies about school transport provision for disabled children. In particular she has received concerns that some parents were receiving misleading advice.
Councils are being forced to make hard choices in the face of ‘sustained financial challenges’. As the Economist reports since 2010 the budget deficit has been reduced from 10% to 4% of GDP; by 2020 it is forecast to be almost eliminated: “To achieve this, the government has slashed spending. Hardest hit has been the Department for Communities and Local Government, which provides councils with most of their funding”.
One example is that of Christine Anderson who had to leave her job to make a 60-mile round trip to school with her 15-year-old son Christopher, who has physical and learning disabilities including spina bifida and hydrocephalus.
Jonathan Carr-West of the Local Government Information Unit, says “it is clear that some councils may soon be unable to meet their statutory duties of caring for the most vulnerable”.
261 complaints about school transport decisions were made to England’s local government ombudsman in 2015-16. The figure is a marked increase, says the ombudsman, Michael King. Only Disability United – outperforming all other media articles – gave a link to his report, All on Board, Navigating School Transport Issues, which recommends that councils should:
- consult parents and schools on changes to individual pupils’ transport arrangements
- provide clear and accessible information on eligibility for free transport
- consider individual pupils’ transport needs “carefully and judiciously”
- consider wider health and safety issues as well as mobility for special needs pupils
There have been campaigns about cuts to transport for children with disabilities over the years in many areas
Demo organised by Eleanor Lisney, a Coventry campaigner and member of Disabled People Against Cuts (DPAC)
The Coventry Telegraph, reporting on these cuts, pointed out that local authorities are required to provide travel assistance for all children who cannot reasonably be expected to walk to school because of their mobility problems or because of associated health and safety issues related to their special educational needs or disability.
Austerity 1: next year, UK ministers required to report progress on reinstating rights of people with disabilities
Equal Lives chief executive Mark Harrison said: “In a very short space of time we have gone from having some of the best rights in the world to a crisis situation where people are dying because of the barriers and discrimination caused by austerity.”
In 2015, a team of United Nations investigators began a two-week visit to the UK as part of an inquiry into allegations of “systematic and grave” violations of disabled people’s human rights.
Stephen Naysmith Social Affairs Correspondent of the Herald has reported that the UN Committee on the Rights of Disabled People has issued a 17 page report on the UK which contained more recommendations for improvement than for any other country in the committee’s 10 year history.
UK rapporteur to the committee Mr Stig Langvad, said the review had been “the most challenging exercise in the history of the Committee”, and criticised the government for failing to heed a 2016 inquiry which had found “grave and systematic violations of disabled people’s human rights.
He said Britain was “going backwards” in terms of meeting its obligations under the Convention on the Rights of Persons with Disabilities, particularly by failing to enable disabled people to have the same choice and control in their lives as people without disabilities.
Key among its concerns was the disproportionate impact of austerity-led cuts on disabled people, with the report claiming disabled people had been left in poverty
- by cuts to benefits and support,
- the closure of the Independent Living Fund,
- the introduction of Universal Credit and
- the change from Disability Living Allowance to Personal Independence Payments.
The Scottish Government was praised for consulting disabled people over its plans for introducing a new social security system, under devolved powers.
UK ministers are required to report back on progress to the committee within 12 months.
The Financial Times reports that Sheffield residents – like many in Mumbai – are protesting against the felling of urban trees. The scene below is similar to the Khar I remembered in 2003, though pavements were constructed and traffic much more dense. The protests were and are against the commercially motivated felling of trees – – some healthy and some neglected by the authorities scheduled to maintain them.
As one Khar resident told me recently, “The rain tree canopy on Khar Danda road used to be so thick that you could walk down the road in the pouring rain and not get wet.” Activist Zoru Bhathena sent ‘before and after’ aerial photos of the now devastated area no longer protected from the summer heat. He took the matter before the Bombay High Court & comments “… magically the problem got solved & no new trees have died! But, the damage is done, and BMC is not enthusiastic to replace the dead trees!”
Earlier this year, the Free Press Journal reported that residents across the city protested about trees being felled on the route of the Metro 7 line being constructed on Mumbai’s Western Express Highway and those who saw six trees were axed last week at the WEH at Malad claimed that the authorities have violated the Bombay High Court’s order which directed the local authority not to cut or destroy any trees on the highway.
Large public protests prevented the contractor from chopping down trees in Sheffield but by then more than 5,000 trees had been felled, to be replaced with saplings. In all, 6,000 trees are to be cut down as part of a 25-year, £2bn highway maintenance scheme.
Some residents blocked contractors by standing inside safety zones put in place around the trees or parking their cars under the branches. On Tuesday, Sheffield council won a High Court injunction to run until July 2018, preventing opponents from taking “unlawful direct action” from breaching barriers around the condemned trees. The latest report from Sheffield may be read here.
Sheffield Tree Action Groups, an umbrella group for protesters, said there were “dangerous flaws” in the contract, and that its members would do “everything we can” to save healthy trees. Bryan Lodge, the Labour councillor in charge of the tree felling programme, said that the council needed to cut down 500 trees by the end of the year or face “catastrophic financial consequences” paying huge sums to Amey (owned by Spanish multinational Ferrovial), if the private finance contract is breached.
‘Urban street trees are loved by the vast majority of people who live alongside them,’ says Oliver Newham of the Woodland Trust, which is about to unveil a scheme supporting those trying to protect local trees:
‘These figures and our email inboxes show an alarming increase in losses. Trees have many benefits in urban areas, such as absorbing pollutants, providing shade and preventing flash flooding. They are essential to a happy and healthy population. Councils need to think twice before taking the axe to them.’
Read more on the valuable role played by trees in a report from the arborist Ian Dalton above left.
Broken Britain 7: prolonged, tragic sagas: infected blood transfusions, OP poisoning and Gulf War Syndrome, denial and delay, pending death
The Haemophilia Society has blown the whistle and called for an enquiry into its own failure and that of government, pharma and clinicians. More here.
Medics and politicians knew by the mid-1970s that commercially manufactured blood products from the USA were suspect. By the mid-1980s there were warnings of a similar situation in respect of HIV. Nevertheless these products continued to be imported and used – just as OP sheep dips were.
British haemophiliacs and other victims’ lives were blighted in the 1970s and 1980s by these cheap imported US blood products, harvested from inmates and drug addicts. More than 7,000 were infected and went on unknowingly to infect family
Last week in The Times, Margarette Driscoll recalls that in 2015, following the Penrose report into contaminated blood products in Scotland (which many victims denounced as a whitewash), David Cameron apologised to those who were infected by HIV and hepatitis C.
References to “compensation” have been changed to “payments” – to avoid admitting the liability which is already common knowledge? The sums received by victims of the contaminated blood scandal are known as ex gratia payments.
In April, as he left the Commons, the former health secretary Andy Burnham declared there had been a “criminal cover-up on an industrial scale in the NHS” over contaminated blood and called for a Hillsborough-style inquiry.
Diana Johnson, Labour MP for Kingston upon Hull North, has been campaigning on the issue since she met one of her constituents, a mild haemophiliac who was given factor VIII in 1983 to prevent excessive bleeding when he had a tooth removed in hospital. He discovered he was infected with hepatitis C in 1995, when it showed up on blood tests for an unrelated illness.
As Theresa May had set up the Hillsborough inquiry when she was home secretary, Johnson was hopeful she would do the same for contaminated blood.
May refused. Johnson requested an urgent Commons debate, which was due to be held on Tuesday. She then got the six leaders of the opposition parties — including the DUP — to sign a letter to Ms May asking for an inquiry, and this is to be set up.
Adding insult to injury? Payment to many victims of NHS blood contamination is to be cut
In March this year a scheme to pay the victims of NHS blood contamination is to be scaled back under government plans announced on Monday. Ministers believe the reforms are necessary because more people are now considered likely to develop serious health issues – and be entitled to higher payouts – pushing the programme as much as £123m over budget.
The government has proposed measures that would cut predicted costs, including limiting the availability of the higher level of financial support under the scheme
Will an enquiry compensate the victims of this NHS for the cuts?