That means he grabbed 2,238 times as much as the annual wage of a worker on the so-called Living Wage of £7.65 an hour. Put another way, whereas it would take a worker a whole year on £7.65 an hour to earn £13,923, this chief executive only has to spend 49 minutes to get that much. The mind boggles! And your blood should be boiling, your resolve to fight poverty pay hardened by such examples of the worst levels of inequality ever recorded.
The directors of the top 100 companies in the UK only need spend one single day at work to earn a year’s Living Wage; their incomes average £3.195million. Most companies studiously conceal the facts about the incomes of their top dogs compared to the workers they hire to produce their profits. And no wonder! Just one example in retail tells the story they don’t want told.
NEXT shops CEO Lord Wolfson last year grabbed a modest £4.6million for himself, which is 459 times as much as the average annual wage of workers in NEXT. They are paid a miserly £6.70 an hour—if they’re ‘adults’! And three out of every 10 jobs in NEXT are 12 hours a week or less—one of the common causes of crucifying poverty in retail, where profit-crazed employers want workers at their beck and call, with very few guaranteed hours a week, but pool of labour to work additional hours at busier times, without the overheads of holiday and sick pay for longer contracts. And of course many big companies go the whole hog and rely on Zero Hours Contracts, the ultimate in casualised, low-paid labour.
We are told daily about the economic recovery. “What recovery?” is the universal reply of the army of workers who slave away without the reward of a share of the booming national wealth. A clutch of charities published figures in March showing that a devastating 870,000 people in Scotland live below the poverty line. And although it was ancient news for some of us, their Report’s most damning indictment of capitalist employers and capitalist politicians was the revelation that over half of those in poverty—436,000 of us—are in jobs, working to stay poor!
Some 80,000 kids in Scotland in 2014 suffer the hunger, disappointment, and stunted ambitions of growing up in poverty despite having one or more parent in work. A more recent report confirmed that the root cause of this national scandal is the blindingly obvious: low hourly rates of pay. 372,000 workers in Scotland—18 per cent of the national workforce—earn below the £7.65 Living Wage, which has been calculated as the bare minimum required for access to a decent life. 93 per cent of these workers are in the private sector: by far the biggest proportions are in retail and hospitality.
Throughout the Referendum campaign we in the SSP warned of the horrendous consequences of remaining under the heel of Westminster Tory dictatorship for the working class majority population. We warned a No vote would usher in assaults on pay, benefits and public services on a scale unprecedented. But even we underestimated just how swiftly this revenge attack would be unleashed. Within a week of the No vote being achieved by a cocktail of lies, scaremongering and false promises for ‘far more powers for Scotland’, the Tories launched full-scale class war on workers and working class communities.
The obnoxious George Osborne declared war on benefits—including child benefits, working tax credits, income support and other in-work benefits—robbing an average of £480 a year off a million Scots, ten million across Britain. He further announced plans to rob people under 21 of Housing Benefit, and of all Job Seekers Allowance after six months unemployed.
In shameless contrast the same Cameron-Osborne Tory dictatorship slashed taxes on the rich, awarding the well-off at least £1,900 a year in tax reductions, and even more outrageously announced what Osborne boasts is “the largest reduction in the burden of Corporation Tax in our nation’s history.” Corporation Tax is to slump to 20 per cent next year, the lowest in the G20 richest capitalist nations. That will mean £8billion less in big business taxes in 2016; £8billion less for vital services, job creation or—God forbid!—a decent minimum wage.
And it’s not as if the big companies that hire the majority of workers—often on pitiful pay—are in need of a handout. Just the FTSE 100 companies alone have already stashed away a monstrous £53.3billion in what is politely termed ‘cash piles’; wealth they refuse to invest in jobs, or modernization of their business, or improved wages. That’s close to twice the annual budget of the entire Scottish government, salted away in the vaults of a mere 100 companies, waiting to be added to when they have to pay even less in Corporation Tax next year.
People in work are amongst those who have to swallow their pride and traipse to food banks for a handout in this rich, food-exporting nation. People are literally starving whilst those at the top of the pile of wealth gorge themselves shamelessly, grabbing a year’s Living Wage in a day. We face another winter where many elderly people will suffer a cruel, avoidable death through hypothermia because they can’t afford to eat and heat their homes. Because their pensions are the worst in Europe compared to average wages, while the supermarket bosses and the Big Six energy companies rake in utterly immoral levels of profit and personal perks.
The urgent need however is to fight to banish the root causes, fight fire with fire in the face of the Tories’ class warfare. For most of this year, the SSP campaigned on the streets with the slogan “Vote Yes for a decent living minimum wage”, arguing that independence would open the door to organise and demand such a central anti-poverty measure. We didn’t get independence—yet! So now we need to link the battle to banish rock-bottom wages with the debate over what powers are to be granted to the Scottish Parliament.
The trade union movement, including the STUC, should join the SSP in demanding that Holyrood must have the powers to set the level of guaranteed minimum wage in Scotland; that’s a key financial issue! There’s a lot of confusion around terms like Minimum Wage and Living Wage. The National Minimum Wage is legally enforceable by government legislation—and the vigilance of the trade union movement, to outlaw wage-dodging cowboy employers. But it is set at a pathetic level: £6.50 an hour for over-21s, and the slave-wage £2.71 for Modern Apprentices.
It is a recipe for poverty—and brazen profiteering by employers, who are more than happy to let taxpayers subsidise their low pay through Working Tax Credit. As a reminder of the class-divided society we need to change, if the national minimum wage had kept pace with company chief executives’ pay rises since it was introduced in 1999, it would now not be a miserly £6.50, but £18.99 an hour!
The Living Wage is the product of research and laudable campaigning by the Living Wage Foundation, Poverty Alliance and others. It is calculated as the bare minimum required for a basic standard of decent life, currently set at £7.65 an hour. But it has two fundamental flaws: it is still far too low to match the mounting cost of living, and it is entirely voluntary, relying on the whims and fancies of employers. Employers are under no obligation to pay it; they can volunteer to do so and win ‘Living Wage Accreditation’ from the SNP government-funded Poverty Alliance/Living Wage campaign. But to highlight the problem, a mere 23 companies in Scotland have signed up so far!
What is needed is a legally enforced national minimum wage, set at a level to guarantee a decent life. A decent, living minimum wage. Which is why since 1998 the SSP has fought for such a minimum to be set at two-thirds male median earnings—about £10 an hour in today’s figures. And that £10 an hour was agreed as the national minimum wage demanded by the recent TUC congress in Liverpool—unanimously!
The recent STUC march to ‘challenge poverty’ needs to be urgently built upon with a systematic campaign in workplaces and on the streets demanding the powers to implement a £10 Scottish minimum wage—for all at 16, with abolition of the lower youth rates, and equal pay for women. Further rallies, demos, pickets of low-paying companies and support for workers who strike for better pay needs to accompany the demands on the Smith Commission.
And alongside that central demand we need a drive for other powers and policies to tackle poverty in 21st century Scotland. Powers to transform our lives. The power to implement a living level of state pension in Scotland, linked to a £10 minimum wage. Full powers over welfare and benefits to reverse the savage assault on the sick, disabled and unemployed by the millionaires’ Westminster boot boys. And a critical issue is repeal of the battery of anti-trade union laws implemented by Thatcher, retained by 13 years of Labour governments, and made even worse by the current Coalition.
Handcuffing workers and their unions was a central strategy in the fundamental redistribution of wealth and power to the rich and big business by successive Tory and Labour regimes. As recent academic reports confirm, inequality in Britain was at its lowest in the years when 58 per cent of workers were in trade unions and 82 per cent of wages were covered by collective bargaining. Now, by 2012, only 26 per cent are in unions, and a mere 23 per cent of wages are determined by collective bargaining, by the combined efforts of workers banded together through their unions. And the gap between the highest and lowest incomes is the greatest it’s ever been since records began.
The link between poverty and the most repressive anti-union laws in the whole of Europe is glaringly obvious. And the position needs to be reversed, if we are serious about banishing the poverty and inequality that scars the face of Scotland. Likewise, the leaders of the 630,000-member trade unions in Scotland need to face up to a simple truth: begging and cajoling employers for a decent wage doesn’t work! There’s no excuse for poverty pay, or poverty pensions, or skinflint benefits. There’s oceans of wealth surrounding us—but it’s in the hands of ‘the 1 per cent’.
So those who fought for independence, plus those who didn’t, should demand the power to tax the richest minority and big business by Holyrood, to fund decent pay, benefits, pensions and public services. The Tories have launched ruthless class war on the rest of us in defence of the rich. That’s in their political DNA, so no surprise there. Labour is at the hip in joined at the hip with this pursuit of profit for the millionaires and poverty for the millions. It’s time the trade union leaders woke up to that reality too, and stopped funding a party that declared their own war on workers with plans for cuts of £27billion by 2017.
And those who have rushed to join the SNP should pause and ponder some fundamentals: you can’t appease the profit-hunger of the multinational corporations—including with pledges of even far lower levels of Corporation Tax than the Tories’ 20 per cent—and at the same time hope to banish the crushing poverty of nearly a million Scots. When the rich and their political puppets unleash class warfare, you can’t stand in the middle, or take both sides. The SSP has no hesitation in taking sides with workers, people on benefits and pensions, the millions in open conflict with those in charge of the massive wealth created by nature and generations of working people.