LABOUR EURO-SAFEGUARDS CAMPAIGN

BULLETIN MAY 1998

  

QUESTIONS AND ANSWERS ON

TRADES UNIONS AND THE EUROPEAN UNION

 

 

1. How have Trades Unions fared since Britain joined the Common Market in 1973?

When Britain joined the Common Market in 1973, 11.5m people were members of British trades unions. Now, total membership is only 8.0m. There are complex reasons for this fall. Some of it is due to Conservative anti-union legislation. Most, however, has been caused by changes in the way the British economy operates, which have been the direct result of Britain's slow growth rate over the last 25 years, since we became members of the Common Market. These include the decline of British manufacturing, much higher levels of unemployment, and the casualisation of a significant proportion of the labour force. During the 20 years before we joined the Common Market the British average growth rate was 3.1% per annum. Since 1973 it has been 1.8%. Between 1950 and 1972 the average rate of unemployment in Britain was 2.2%. From 1973 to 1997 it was 8.0%.

 

2. Has trades union membership fallen everywhere during the last 25 years?

No it has not. Falling trade union membership has occurred in the developed western world mainly because manufacturing has been allowed to decline - the direct result of monetarist policies of retrenchment and high interest rates. As industrialisation has fallen back, so the growth rate has gone down, because productivity increases are so much easier to secure in manufacturing than in services. By contrast, in countries which are growing fast, largely because they have expanding manufacturing sectors, rapid productivity increases and growth in trade union membership go together. This is why trades union membership is positively correlated with economic growth. Weakening trades unions by reducing the importance of manufacturing, as so many western countries have done, is thus a totally counter-productive policy. Nevertheless, far too many supposedly left of centre governments have tolerated the decline of the steel, shipbuilding and coal industries, and related manufacturing, which has done much to tear the backbone of the labour and trade union movement, heavily weakening the bargaining position of working people in the process.

3. Have the problems which Trades Unions exist to combat become any less important?

Trades unions came into existence to protect their members from exploitation, to provide strength in numbers in negotiations over pay and conditions, and to provide help and support to their members in times of trouble. For these objectives to be achieved, full employment is essential, as trades unionists have always realised. Unfortunately, mainly as a result of rising unemployment, working conditions have changed radically in both industry and services over recent decades, often for the worse. The fragmentation of the labour market has led to employment practices which would have been regarded as completely unacceptable 20 or 30 years ago. These include zero hour contracts, very low rates of pay, exceptionally long hours of work with no overtime, and, particularly as enterprises change hands, wage cuts, disadvantageous working arrangements and dismissals. The mutual support and social cohesion which trades unions provide is therefore even more important now than it used to be.

 

4. What have Trades Union Leaders done to combat the decline in the strength of their Unions?

Trade Union leaders have had a difficult rearguard action to fight over the last few years. Legislative changes and Britain's faltering economic performance have not been within their control. Many have modernised the appeal of their unions by introducing new services, and adapting their roles to current labour market conditions as best they can. They supported the election of a Labour government, hoping that it would reverse some of the loss of legal status which had taken place under the Tories. Much less wisely, however, many trades unions leaders, having been initially sceptical of the benefits of Common Market membership, now see Britain's further involvement in the European Union as a positive benefit. They believe that the EU may restore to trades unions the benefits and status which they have lost in Britain over the last 25 years. It is important for them to understand why this is extremely unlikely to happen. The overriding reason is that full employment has never been a high priority EU objective, given the monetarist slant of EU economic policy, and in these circumstances, trades unions will always be in a relatively weak position.

 

5. Is the Social Chapter the answer?

As the Maastricht Treaty agenda moves the EU towards the implementation of the Single Currency, the Social Chapter was supposed to offer a counterpoint to the harsh impact of the monetary criteria with which EU economies have to comply to enable them to be Single Currency members. To soften the impact of the deflationary policies required by the criteria, the Social Chapter was designed to provide the working population of the EU with more and better jobs to offset the harsher effects of monetary union. This prospect was sold to the TUC with great effect by Jacques Delors, Chairman of the Commission in a famous speech in 1988. It was accompanied by suggestions that trade union leaders would receive a much warmer welcome when they visited Brussels than they did from members of the Conservative government. The result was a more favourable view being taken of the EU by many trades unionists, without looking closely at what the Social Chapter actually had to offer, for in fact its positive effects are almost negligible.

 

6. What does need to be done to strengthen the rights of labour?

So far the Social Chapter has only two provisions. One is to increase the rights of both mothers and fathers to unpaid parental leave in certain circumstances and the other is to create works councils where there are more than 500 employees. These make almost no difference at all to the balance of power in the work place. Nor, indeed, is legislation from Brussels required for any changes which the British people might think were appropriate. The plain fact is that the Labour government could implement any changes it thought appropriate to the laws governing labour relations in Britain. The Social Chapter is so feeble that hardly a single proposal which the Labour government might contemplate in this area would fall foul of Brussels provisions, because almost none exist.

 

7. Will the Single Currency help Trades Unions?

If the Social Chapter is a broken reed, the Single Currency is not. This is of much more immediate consequence to Trades Unions, and a much more serious threat. The EU does not fulfil any of the economic criteria required by a single currency area. Its implementation, especially if Britain were to join, is likely to exacerbate all the damage already done to them since Britain joined the Common Market, and for the same reason. The Single Currency is very unlikely to increase the growth rate in the EU. The Maastricht criteria, which are entirely concerned with monetary matters, are bound to add to deflationary pressures. The strength of the European Central Bank, charged with stable prices as its over-riding objective, and controlled by central bankers with eight year non-renewable terms of office, is bound to have low inflation levels as a more important target than high growth rates. The Dublin Stability Pact adds another deflationary twist, adding a further substantial risk that the Single Currency project will run onto the rocks. The inevitable result of Monetary Union will therefore be continuous high levels of unemployment, further tilting the balance of power and influence away from trades unions. The public sector will be adversely affected, jobs will be under threat, and services upon which trades unionists and their families depend, such as the NHS, decent pensions and the rest of the welfare state are liable to be undermined. The dangers to the trades union movement from the Single Currency are therefore real, immediate and of vital importance.

 

8. What should Trades Unionists campaign for in these circumstances?

The over-riding interest of working people in Britain, and indeed across the whole EU, is to see more economic growth and much fuller employment. These are the conditions which will raise living standards, produce genuine long term job security, and bring power and influence between employer and employee in the work place back into a more even and acceptable balance. Such conditions can only be achieved by a major move away from the kind of monetary policies exemplified by Maastricht. Instead, as in all the fast growing countries of the world, we need low interest rates, plenty of money available for investment in industry, and exchange rate conditions which enable exports to boom and most of the requirements for the domestic market to be met from home industry.

 

9. Does the TUC reflect any of these concerns?

The TUC exists to act as the co-ordinating body for trades unions throughout Britain, to represent their views and to act on their behalf in negotiations with all concerned with trade union affairs. It might be supposed, therefore, that the TUC would reflect in its policies and pronouncements the major risks to trades unions which current policy developments in the EU represent. Regrettably, it does nothing of the kind. On the contrary, it has joined forces with the CBI to urge the Labour government to join the Single Currency in the first wave. It brushes aside the legitimate concerns of those who take a much less optimistic view of the EU's future than the TUC does. It has nothing constructive to say about the appallingly high levels of unemployment in the EU - now averaging 12% across the Union, with 19m registered as out of work, and probably 30m people capable of holding down a job if one was on offer at a reasonable rate of pay.

 

10. What should Trades Unionists do?

Many trades union rank and file members must now be wondering whether their leaders are taking them in the direction they want to go. Opinion polls show an overwhelming proportion of the population opposing Britain joining the Single Currency, and this must include large numbers of trades union members. Some unions are showing signs of scepticism, but not nearly enough. Indeed, we may have reached the astonishing situation where working people, the section of the population with most to lose from Europe wide deflationary policies, are represented by leaders who collectively are more in favour than any others of the policy drift which is likely to be so damaging to their members. This is why the role of active trade unions is so important. These policies need to be changed. It is up to trades unionists at every level now to make sure that this happens, through long recognised democratic channels - begun by resolutions from branches, union-organised lobbies of Parliament, public meetings and demonstrations. Many trades unionists in other EU countries, showing acute awareness of the dangers of EMU, have shown us the way. The British trades union movement urgently needs to wake up to the threats it faces from the single Currency, before it is too late.

 

 

Published by the Labour Euro-Safeguards Campaign

72 Albert Street, London, NW1 7NR

Tel: 0171-388 2259 * Fax: 0171-388 3454

E-mail: lesc@johnmills.co.uk * Website: http://www.lesc.org.uk