Austerity economics don’t add up and Scotland’s public services are living through a lost decade

The political energy released during the referendum campaign is focused on inequality during Scotland’s Challenge Poverty Week.

The political energy released during the referendum campaign is focused on inequality during Scotland’s Challenge Poverty Week

Trade unions and the wider civil society have come together this week in a series of events culminating in a march and rally in Glasgow on Saturday. The aim is to highlight the damage inequality does to everyone in Scotland and provide a space where new ideas can be debated and developed.

UNISON Scotland’s contribution includes a report on the impact of austerity on Scotland’s public services and the staff who deliver them. Creating decent work and providing dignity for those who cannot work is at the heart of the battle against austerity and tackling inequality. It makes economic sense and this report demonstrates why.

The rich are laughing their way to the bank, as 71,428 people in Scotland queue for very different banks. The demand for Trussel Trust food banks has risen 400 per cent in just three years. 480,000 adults in Scotland live in poverty and nearly one in five children live in a home with at least one adult working.

These are Cameron’s ‘strivers’, hit by the big shift from wages to profits. You have to go back to the 1860’s for a pay squeeze as long as this one. If the wage bill had just kept up with inflation there would be £5bn more spending power in the Scottish economy. Even among those suffering, the pain is not evenly spread. Women in low pay have a pay gap of 34.2 per cent and young workers classed as low paid have more than tripled over the past four decades.

Cameron’s real pals aren’t suffering from austerity. The wealth of the richest 1,000 people in Britain has doubled since 2009. FTSE 100 Directors awarded themselves a 21 per cent pay rise last year and now earn 120 times the average full time worker. Britain’s highest paid director earned in 49 minutes as much as a worker on the living wage earns in a year!

However, this isn’t just about London – it’s here in egalitarian Scotland. An Edinburgh fund manager reported recently that seven directors earned an average of £2.5m each and settled a post retirement benefit on a former director of £31m. Three families in Scotland own more wealth than the poorest 20 per cent put together.

Today’s UNISON report argues that we need to start seeing money spent on public sector workers as an investment not a cost. A one per cent increase in public sector pay would generate up to £820 million in increased income tax, National Insurance contributions and expenditure tax receipts, as well as reduced benefit and tax credit expenditure. It would also inject £460 to £880 million of extra value into the economy and create jobs.

A workforce that cares, cures and educates should be celebrated as an achievement, not constantly under attack as a drain on resources. The cleaners, classroom assistants, chefs, care workers and many others, do vital jobs that support and protect us all. They are worth and deserve decent pay and conditions.

The constitutional debate in Scotland may divide over independence or further devolution. But what unites Scotland is a desire to challenge poverty and create a more equal society. Its not about the ‘45 per cent’ or the ‘55 per cent’ – its about the 99 per cent who understand that a more equal society benefits us all.

The message from Scotland this week is that we all deserve to live in a society that puts people first, where the economy is run for everyone, not just the well off.

Dave Watson is the head of Bargaining and Campaigns at UNISON Scotland

5 Responses to “Austerity economics don’t add up and Scotland’s public services are living through a lost decade”

  1. NorthBrit

    Though the wheels of God grind slowly:
    http://cdn.yougov.com/cumulus_uploads/document/dmv27pn9yn/YG-Archive-Pol-Sun-results-161014.pdf

    Yet they grind exceeding small.

    The unions supported a “No” vote.

    They “deserve to live in a society that” they campaigned for.

    It would be preferable if they had the decency not to complain about the consequences of their actions.

  2. Godfrey Paul

    Living off the subsidies from the English taxpayer.

  3. Shinsei1967

    “These are Cameron’s ‘strivers’, hit by the big shift from wages to profits.”

    This isn’t actually true. There has been no increase in corporate profits in recent years. In fact corporate profits as a percentage of GDP are at a near 30 year low.

    Here’s the chart. It only goes up to 2012, but corporate profits have basically not recovered since then (big profit generators like the banks are still loss-making, big retailers are under pressure, big oil companies hurt by lower oil price etc)

    http://stumblingandmumbling.typepad.com/stumbling_and_mumbling/2012/12/on-wage-and-profit-shares.html

    It is certainly true though that CEOs have been taking massive and unmerited pay rises.

  4. uglyfatbloke

    Yup. The only set of negative subsidies known to humanity.

  5. anonymous

    The “distribution of wealth” is truly appalling, it’s actually totally, morally and ethically reprehensible – the idea that one person’s worth, in 49 minutes, is equal to what another man struggles to make for himself and his family in ONE year, is utterly intolerable, and these kinds of examples are exactly what we need to demonstrate that it’s time for some social equality – in fact, it’s long overdue. Even in the small microcosm that is a Local Authority, the same kind of inequality exists on a smaller scale, where upper mgmt salaries are treble or quadruple what a low-paid officer or front-line service worker might make. In that case, the salaries at the top, need to be reduced, the salaries at the bottom, need to be increased, and the salaries in the middle, slightly increased – which is the same thing that should happen at the national level. Perhaps the gentleman who makes someone’s one year salary each 49 minutes, could donate an hour of his wages to a poor Scottish family each day – which would be life-changing for that family, but wouldn’t even be noticed by Mr. 49 Minutes, as we will call him. You know who you are, you know your salary is obscene, more obscene than the worst pornography, and in fact, this kind of horrific imbalance is what is keeping Local Authorities from moving forward – the lower paid staff are immobilized with fear, too much poverty to deal with, while the higher paid staff, are buying that second home in Spain, or that third Mercedes, or whatever it is – again, if they would just donate one hour of their salary, each day, to a low paid Scottish family, then that might go some tiny way towards the idea that such obscenely high salaries should be allowed to exist – why pay someone 90,000 pounds a year, to do work that they could easily do for less than a third of that amount? It’s just ridiculous, and something should be done about it – I guess we need to have a word with Mr. 49 Minutes and his “friends”. I feel physically sick when I read about this, when I think about my parents, both criminally underpaid and working all hours of the day and night – they never caught a break. I never will either, if you are born poor, you die poor – pretty much. What a wonderful place to live ! (Planet Earth, I mean). Have a nice day !!!

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