Unite votes to stay a union: defence workers and McCluskey give ‘Marxists’ a lesson in Trade unionism
Johnny Lewis reports from Unite’s policy conference:
The first big debate of Unite’s conference concerned Trident: conference was confronted with a number of motions, calling for scrapping Trident now and an Executive Statement which argued for opposition in principle to nuclear weapons but; “Unite does not and never will advocate or support any course of public policy which will put at risk jobs or communities. Although in favour of defence diversification “Until there is a government in office ready, willing and able to give cast-iron guarantees on the security of the skilled work and all employment involved, our priority must be to defend and secure our members’ employment”. This Statement was passed overwhelmingly and with it the motions calling for trident to be `scrapped now’ fell.
For the union leadership and the defence workers this debate was not really about trident but the very character of the union, it is fair to say this character was encapsulated in the Statement and in particular no support for policies which `… put at risk jobs or communities’. The resolutions opposing the Statement with their demand of ‘scrap now’ violated that idea of a union’s function. If such a resolution had been passed, while it would not have materially effected defence workers’ jobs, it would have signalled support for a policy which put jobs at risk, and the union would, to use the words of one of the speakers, have “abandoned us”.
Although victory for ‘scrap now’ would have had no material impact on jobs it would have had a very real impact on the union’s unity. Large numbers of defence workers would have left and at best joined the GMB (at worst joining Community or leaving the movement altogether), and who in their right mind could blame them? I don’t think those arguing to ‘scrap’ got the implications for the union – until McCluskey spelled it out in his closing remarks.
With one or two exceptions those opposing the Statement were white collar, from outside manufacturing and from London, while supporters of the Statement were largely manual workers from the industry and from outside of London. This division mirrors Brexit and has been observed within the Labour party. While it is clear the vast majority of the ‘scrap now’ support can be characterised as Corbynistas it is not possible to clearly pigeon hole those supporting the Statement except to say they saw themselves as trade unionists rather than political animals and a majority would not see themselves as Corbyn supporters.
The main problem for the ‘scrap now’ speakers was how to argue a position which if passed would have meant the union’s abandonment of the Trident workers. Unable or unwilling to confront this conundrum they ignored it, speaking in general terms and in equal measure about diversification and the need to support Corbyn – of course the most zealot Corbynistas where those outside the party.
Both these points were easily dealt with by the defence workers: on diversification they pointed out that the ‘scrap now’ advocates were substituting the potential to develop diversification which had been opened up by Corbyn’s victory with the present situation where there are no diversification blueprints and even if these existed the Tory Government is not going to implement them. The diversification argument existed simply as a prop to enable scarp now to avoid arguing there real position `scrap regardless’ of the impact on members or on the union.
The Corbyn argument was of a different order: here the ‘Marxists’ came into their own, and the broad sweep of history and grand strategies alighted on the shoulders of the Unite conference.
Their line of argument went something like this: Unite supports Corbyn; failure to support ‘scrap now’ would be a failure to support him and so give a hostage to Labour’s right. On the other hand supporting ‘scrap now’ would be a massive boost to Corbyn’s struggle in the party and by default the movement which has gathered around him. Needless to say, this missed the mark by some many miles.
If the Corbynistas are a broad socially liberal movement, the self-proclaimed ‘Marxists’ within it should want to move beyond liberalism and build a class-based movement which by definition must include the defence workers. Indeed, building a class movement will largely depend on how far the left wing of the Corbynistas can turn it outward and proselytize among workers such as those in the defence industry. The supposed ‘Marxists’ in this debate provided a master class in how not to build that movement. Most striking was the unintended consequence arising from combining ‘scrap now’ with the Corbyn struggle in the party: the effect was to reduce defence workers to pawns to be sacrificed in the great game that is the left vs right battle within the Party.
That approach illustrates the complete failure of these ‘Marxists’ to recognise the division between the economic and political, and within this division that unions are primarily economic entities. A consequence is these people continually push unions to adopt programmatic demands appropriate to a party rather than a union. In this instance asking conference to supress the union’s core function of defending member’s terms and conditions in pursuit of a political goal, the only possible result was to further repel the defence workers from the left and Corbyn.
The real tragedy in this vignette is that until now the only serious work undertaken on defence diversification has been that of defence industry workers. Now a Corbyn labour party can build on that work harnessing the workers in the industry, their unions and party to formulate diversification blueprints. This approach was central to the Statement:
“Unite commits to campaigning to secure a serious government approach to defence diversification… and urges the Labour Party to give the highest priority to this aspect in it considerations.”
We have then a platform which can not only develop diversification policies but also a process where defence workers will be exposed to the ideas of the left opening the possibility of winning them over to socialism.
Apart from the decisive victory the debate itself was well run and a joy to watch as the defence workers and McCluskey, provided the ‘Marxists’ with a lesson on what is a trade union and how it should function. I hope (but doubt) they will have learnt their lesson.
Above: friends, families and onlookers at the scene
Saibo Sillah, Ousman Jabbie, Mohammed Jangana, Alimano Jammeh and Bangaly Dukureth were crushed to death at work in my home town of Birmingham on Thursday. They were all Muslims and EU migrants, working through an agency for the minimum wage and sending most of their pay back to their families.
The firm they worked at, Shredmet Limited, owned by Hawkeswood Metal Recycling, has previously been involved in three serious incidents and been fined £60,000 by the Health ad Safety Executive when a lack of guarding led to a man’s arm being crushed. The same site was hit by a huge, unexplained fire in 2011.
Hawkeswood Metal Recycling processes more than 500,000 tonnes of scrap metal each year. The firm began trading more than 40 years ago and has a customer base that includes local authorities, major PLCs and smaller independent companies.
It is a business with an annual turnover of more than £30 million, reporting a net profit in 2015 of £327,000 in accounts submitted in February this year. It employs 26 people.
The victims were the sort of hard-working migrants that the Brexiteers want driven out of Britain. And the inadequate health and safety legislation that failed to protect these men, will be even further watered down if the Brexiteers have their way.
The five men died when a huge concrete wall collapsed on top of them. The 15ft tall wall, made of one-and-a-half ton concrete blocks, came crashing down on the men at the Shredmet site in Aston Church Road, Nechells. As the wall fell, blocks of metal also rained down on the men: the five had no chance of survival.
A sixth man miraculously managed to escape, digging his own way out of the rubble despite his leg having been broken.
Detective Superintendent Mark Payne of West Midlands Police said: “I’ve seen the scene and nobody is alive in that scene. We have done absolutely everything as you’d expect to check there is no opportunity to save a life. Without being too graphic, there’s no possibility of anyone being alive in there.”
Meanwhile, families and friends gathered outside the gates of the plant, anxious for news of loved ones and workmates. Local residents put out drinks and food for the grieving visitors.
Manka Sawo was alerted to the tragedy by the man who managed to escape, and who was taken to hospital for treatment to his broken leg.
“I know all of them,” he said. “I knew Saibo Sillah from a community centre where we used to pray together.
“Saibo had seven children, including two-year-old twins. He was a very, very decent guy. I’m devastated. This is a sad day. They are all from The Gambia. Some of them lived in Spain and Denmark before coming here. I heard the news from the man who broke his leg. He phoned his family from hospital, and we came here to find out what had happened. I knew one of the men very closely; yesterday we celebrated Eid together. It’s very, very sad.”
A friend of Mr Jammeh and Mr Jabbie said: “Ousman only moved over here a week ago and moved in with Alimamo. He was waiting for his wife and family to come over, who are still in north Gambia. Alimamo’s wife and children are due to arrive on Sunday. They don’t have any phones so there’s no way of contacting them. We will only be able to tell them when they arrive that their husband and father has died. It’s going to leave them heartbroken.”
Meanwhile, Mr Jagana’s devastated friend Mohammed Kamarah said: “He has a wife and a daughter, who is less than one year old. His family are praying for him. They are distraught beyond words. He was a good hard-working man and a great friend.”
Scrapyard worker Matt Bowen, who was off work for the day because his son was ill, posted a poignant message on Facebook.
“I hope you rest in peace lads, I truly do. Part of me is sorry I wasn’t in today, the other half is glad my son was poorly. Words cannot describe the thoughts that are going though my head, let alone the lads that were in work today. My thoughts and prayers are with your families who you worked so hard for. God be with you brothers, I am heartbroken, to say the least.”
You can donate here: https://www.justgiving.com/fundraising/Nechells5
Speech delivered 20th June (NB: not the same as his piece in yesterday’s Guardian)
May I start by expressing Unite’s shock at the death of Jo Cox and our deepest sympathy to her family.
We can only hope that the outpouring of grief from across the nation will help Jo’s husband, Brendan and his family in these unbearable times.
Her death places in context what is really important in our lives.
She was, of course, a passionate advocate for the Remain campaign and would surely want political debate to continue.
Brothers and Sisters,
As this referendum campaign draws towards a close, I think everyone can agree on two things.
First, it matters. As we come up close to the moment of decision, this feels like one of the most important votes any of us will cast in our lives.
And second, this is close. The elite complacency of the start of the campaign, that this was just a quick canter to the winning post for REMAIN, has disappeared.
This could go either way.
For those two reasons, I wanted to speak out directly, both to and on behalf of the members of Unite, the biggest trade union in the United Kingdom, also as someone who can legitimately claim to know the hopes and fears of the working-class communities across the country, the sort of community I grew up in and have kept my roots in.
There is no need for a spoiler alert – Unite is fighting all the way for a Remain vote, and for Britain and British workers to build their future in unity with the rest of Europe.
But I have not come here to lecture or to patronise those working people who take a different view. Who can be surprised that in so many industrial areas, voting for the status quo is not exactly a popular option?
I am just asking all those people, including many Unite members, to reflect on their concerns, and whether they would be best addressed by staying in Europe, or by a Brexit.
And I want to flag up what I believe will happen to working people on the morrow of a vote to leave.
Let me turn first to the issue of IMMIGRATION:
Some pundits and commentators, like explorers returning from a visit to the deep unknown, are stunned to find that this has become an issue.
I for one am not in the least surprised. I understand those concerns. They are NOT, for the greatest part, anything to do with racism or xenophobia.
They are to do with the systematic attempt by our greedy elite to hold down wages and cut the costs of social provision for working people.
Let us be clear – what has been done in the last ten years is a gigantic experiment at the expense of ordinary workers. Countries with vast historical differences in wage rates and living standards have been brought together in a common labour market. The result has been huge downward pressure on living standards.
What happens when two hundred workers are competing for jobs where previously only ten did? Wages are frozen or cut.
What happens when workers can move from a country where a job pays £5 an hour to one where the same job pays £20? The answer is that many do so move, and the same job then ends up paying just £12 an hour.
That is why trade unions have never been in favour of a so-called free labour market. Control of the labour supply in an industry or across society has always been the core of our mission, to ensure that workers get their fair share of the wealth they create.
But let me be clear about something else. Pulling up the drawbridge against the rest of Europe is the wrong answer. Read the rest of this entry »
In view of the horror and grief that all decent people have expressed following the murder of Jo Cox, and the suggestion that the Remain campaign has sought to use her death to further its cause, it is important to place her views on the EU referendum and immigration on the record. The following piece was posted by Jo at the Politics Home site on 13th June – a just three days before her murder. Readers should not assume that Shiraz Socialist agrees with all of it:
Brexit is not the answer to UK immigration concerns
By Jo Cox MP
With many voters still making up their minds about a decision that will shape the future of our country, Oxford University’s Migration Observatory offered a stark warning that despite offering the world the Leave campaign cannot guarantee what would happen to migration if we left.
Most voters recognise that our country has reaped many benefits from immigration, from the brilliant doctors in our NHS to the skilled workers helping our economy to grow. Yet across the country people face everyday worries about job security, school places and GP appointments.
In the last two weeks of the campaign voters should know that despite these legitimate concerns, Brexit is not the answer. Here’s why:
First, Brexit doesn’t guarantee that migration will come down. In fact a more liberal approach to non-EU immigration – as advocated by the Leave camp – could actually see it increase.
Australia – whose points-based system is so admired by Outers – has twice as many migrants per person than we do. The whole purpose of their system is to allow businesses to control who comes into their country. For us this would lead to an increase in cheap labour, bringing down wages and doing nothing to ease voter concerns about insecure employment.
Voters also need to know that that the free movement of EU citizens to Britain will not automatically stop if we left. The only way to do that is to leave the single market – an act of economic self-destruction that would be catastrophic for businesses and jobs across the country.
Second, we can do far more to deal with the pressures caused by migration from inside then EU. Labour has long pushed for an end to the payment of benefits to people who don’t live permanents in this country, and for a major extension of the time EU migrants have to wait before being able to claim benefits – a commitment secured by the Prime Minister as part of the renegotiation deal.
We can also help communities facing the greatest pressure from migration. Since 2001 EU migrants have contributed £20 billion more to our economy than they’ve taken out in benefits. This money must go quickly to areas where migrants are living, to fund schools and health services.
This will ensure that people come to this country knowing they need to play by the rules and work hard, and will reassure Brits that we have a fair, under control system that works for everyone.
And finally, the overall benefits of EU membership are massive. From businesses in Yorkshire to the President of the United States – and pretty much everyone in between – there is now an unprecedented consensus that leaving the EU would hurt our economy and hit our pockets.
We cannot allow voters to fall for the spin that a vote to leave is the only way to deal with concerns about immigration. We can do far more to address both the level and the impact of immigration while remaining in the EU. I very rarely agree with the Prime Minister but on this he’s right: was are stronger, safer and better off in.
Above: Stephen Kinnock pays tribute
By Martin Thomas (also at the Workers Liberty website)
88% of six hundred economists surveyed for The Observer newspaper (29 May) reckon that Brexit would reduce economic growth in Britain.
Economists often get things wrong, and the gist of the economists’ opinion is that Brexit would disrupt the regular flows of the global capitalist economy, thus pushing down trade and investment into Britain.
Most enlightening is what the pro-Brexit minority of economists say. The “Economists for Brexit” group led by veteran Thatcherite Patrick Minford has produced a report.
As ardent free-market ideologues, they argue that a capitalist Britain outside the EU will do well because it will have fewer constraints on the rapacity of the free market.
They object to the EU because “the EU has pressed for social legislation (such as the 2003 Working Time Directive and the 2004 Gender Equality Directive) that adds to companies’ costs”.
Their list would probably also include the Agency Workers’ Directive, TUPE, and redundancy-payment laws.
They also object because “European governments have been more emphatic than the global average about the dangers of global warming” and so the EU has pushed Britain to “adopt the renewables agenda with greater zeal… Coal-fired power stations have been closed down, offshore wind farms built and so on…”
The Brexit campaigners disagree among themselves on what trade deals Britain should do on quitting the EU. The economists go for a radical option: “What other trade agreements do we need? My advice would be: none”. Not the Norwegian model, not the Swiss model, not the Canadian model, not even the Albanian model favoured by Michael Gove.
The pro-Brexit economists argue that Britain should scrap all barriers to imports, and seek nothing more than World Trade Organisation rules for its exports. In their calculations the benefit of cheaper imports outweighs the consequent job losses.
On immigration, the economists differ from the Ukip-minded majority of Brexit campaigners in that they want more non-EU immigration and less immigration from the EU.
There, spelled out clearly, is the second core Brexit argument after the basic Ukip “hate-migrants” case. It is an argument for Britain as an offshore, low-regulation, low-social-overheads, environmentally-reckless site for global capital.
Whether their scheme would “work” in its own terms is doubtful. That it represents the way Brexit points, socially and economically, is not.
The way to fight the neoliberal policies of the EU leadership is by starting from the limited integration across borders created by the EU, and working for cross-border solidarity around demands for social levelling-up, democracy, and more open borders.
Unite for Khan
Download and read the Unite draft submission to Sadiq’s manifesto
- Business, growth and jobs – Unite Khan manifesto submission [PDF]
- Equality and fairness – Unite Khan manifesto submission [PDF]
- Housing and planning – Unite Khan manifesto submission [PDF]
- Safer and healthier communities – Unite Khan manifesto submission [PDF]
- Transport and infrastructure – Unite Khan manifesto submission [PDF]
Why London and Eastern Region of Unite came to support Sadiq
On Saturday 16 May 2015 Unite’s Regional Committee met to interview 5 candidates who had put themselves forward to be the Labour party’s candidate for the London Mayor election in May 2016.
The committee, which is made up of lay members from across all of Unite’s industrial sectors including; b us and taxi drivers, cleaners, charity workers, health and Local Government workers, printers, bank employees and members from manufacturing, spent over 4 hours listening to the views of all the candidates to four questions we posed on transport, housing, workers’ rights and equalities.
At the end of the meeting the committee held a vote and it was decided that London and Eastern Region would support Sadiq Khan as our first preference candidate (to be the Labour candidate) and Diane Abbott as our second.
All of the candidates performed well, but the meeting felt that Sadiq offered the best vision for London and Londoners, closely reflecting the values and policies of the regional committee.
Since the hustings Sadiq has come out with a number of policy initiatives that underline why we were right to give him our support including:
- A one wage structure across the London’s bus network
- A clear commitment to build more social homes for rent at affordable levels
- The creation of an economic fairness unit at City Hall to deliver a £10 per hour London living wage
- End the use of companies who have taken part in blacklisting union members
Sadiq Khan offers the best hope of Londoners including our members. If he is successful he will clearly make a difference – That’s why we are supporting Sadiq.
You can find more about Sadiq’s plan for London at www.sadiq.london
Guest post by Bill Sharpe
Arguing against the renewal of Trident must have seemed so simple, an easy win for the Corbyn Labour leadership, swords into ploughshares and we all walk off arm in arm into a Trident free sunset – maybe singing the Red Flag. That may well have been how the Corbynistas saw it playing out, yet right from the outset when they started this particular hare running, the reality was very different. The parliamentary timetable was always against Labour having any real say, it was always going to engulf the Party, and particularly the PLP which was not going to be helpful as the key unions (GMB and Unite) were always going to be for renewal. Everything points to a fudge at the next Labour Party conference and with it inevitable demoralisation among the Corbynistas. My union, the GMB, will be quite happy with this, as we have thousands of members whose jobs depend upon Trident.
The one thing that may change this is how Unite votes on the matter at its forthcoming Policy Conference. Although Unite’s defence workers are fully behind renewal, the conference has a number of anti-Trident resolutions on the agenda and if it were to vote against renewal it would once again change the balance of power within the Labour Party.
Unite is generally seen as the most influential left wing union and socialists will view Unite’s forthcoming debate primarily in political terms – a left vs right `shoot out’: on one side the defence industry workers who are seen (probably rightly) as pro – imperialist, right wing, reactionary etc etc; on the other side the union’s lefts who want to scrap Trident, end austerity and are Corbyn supporters – also probably true. Such a view is to miss the point. The Unite debate will not be a political but an economic, a trade union, matter – or at least I for one would hope so.
Unite Policy Conference delegates have three possible choices: they can vote for `unconditional support’ for renewal, `scrapping only’ if suitable alternative work can be found or `scrapping regardless’ of whether alternative work can be found. For sure, the `scrapping only’ positon will bring together a big majority within the union leaving `unconditional support’ the minority position. There is however a fatal flaw in the ‘scrapping only’ standpoint.
When the Berlin wall fell the defence industry went into free fall with many thousands of jobs lost. In response the unions undertook a number of studies looking at alternative work; some were very imaginative but none were viable. What employer was going to pay top dollar to some of the most highly skilled workers in the county (after space technology putting together a Trident submarine is the second most complex technical exercise humanity undertakes) concentrated in one of the most inaccessible places in the county to build white goods or wind turbines? The alternative work plans were seemingly consigned to the dustbin of history. However some 25 years later variants of these plans were resurrected, finding their way onto Corbyn’s election campaign website as part of his pitch to scrap Trident.
While intellectually lazy and/or self-deluded socialists have tacked onto the end of their anti- Trident arguments the demand for alternative work, so resolving (to their own satisfaction) the problem of mass redundancies and the devastation of Barrow and surrounding areas, workers in the industry have looked into the matter and are telling us there is no such thing as alternative work. Consequently ‘scrapping only’ is in effect a vote for renewal – a position I for one hope the Unite conference will adopt. However many on the left, including it would seem, many in Unite, stand on the ‘regardless’ position.
The problem with the ‘regardless’ position is when the rhetoric and caveats are removed such resolutions are calling on the union to support the sacking of several thousands of their fellow members. For a union to vote for a `scrap anyway’ resolution would be a fundamental violation of its core functions: the defence and enhancement of terms and conditions and the aspiration to organise the entire working class regardless of their political views.
This issue illustrates in a very stark manner the underlying and enduring difference between general class interests, which translate into political interests – in this case the scrapping of Trident – and specific sectional interests which are unions’ economic concerns and in this instance mean keeping Trident.
In saying unions should support ‘scrapping only’ I am not saying a union is always right: such a view would suppress any critical judgement of unions and deny any right to independence of thought by socialists when dealing with unions: it would mean (at best) becoming a more realistic variant of the unions’ house journal the Morning Star. I am, however, saying socialists should recognise that a union must pursue its members’ interests, even when these come into conflict with broader socialist views.
For socialists who wish to be critical of unions there are two possible approaches: one can be characterised as `politicising unions’, which starts from recognition of the division between the political and economic as a given and as far possible attempts to mitigate the sectional and where possible merge the sectional into a more general class interest. This is done within the unions themselves around industrial matters, but more importantly engaging with and helping develop a socialist political culture within the unions.
To begin to undertake such a task one has to recognise the existence of the political / economic division. But in this period of union decline the dominant approach of leftists and would-be Marxists is to be seemingly unaware or indifferent to the division. There are clear parallels here with 3rd period Stalinism. In this approach the left is continually attempting to turn the union into a political rather than an economic entity, they view it as a form of political party and continually demand its programme appropriate to a party – political unionism. Such an approach can only succeed by either superseding or suppressing the union’s economic function of defending member’s terms and conditions.
A ‘scrap anyway’ positon illustrates this point in a very blunt manner, as it inescapably means supporting the loss of many thousands of jobs (an unfortunate by-product of the greater good) and with it supressing the unions function of defending members jobs.
The ‘union as a political party’ approach is also how the best trades unionists tend to perceive (and reject) what socialists are about: it needs little imagination to work through the political lessons defence delegates will take away from Unite Trident debate as they listen to their `left wing’ bothers and sisters explaining why they should lose their jobs.
The Unite Trident debate holds within it two possible ways socialists can approach unions: if their conference can get beyond a debate about ‘scrapping regardless’, which is to recognise they cannot support non-renewal. They will then be in a position to play a pivotal role in taking the alternative work debate forward. At present the demand for alternative work is merely a rhetorical prop for socialists, with no real content – based on present realities it can go nowhere. Unite has the ability to demand that labour links alternative work for the defence industry into a broader call for a rebalancing of the economy which should have centre stage in Labour’s 2020 manifesto.
The ability to move the alternative work debate on is made possible by the space opened up by Corbyn’s victory: it should be seen as part and parcel of the potential which now exists for the refounding of a labour movement. Although in many respects this will be very different from 1900s, now as then, socialists have a choice: either they engage with this or cut themselves of from it: posturing and empty sloganising will inevitably fail, but pursuing the politicisation of the unions (as opposed to the left’s agenda of “political unionism”) may just offer a way through the dilemma.
As the UK’s steel industry faces extinction, the Tories prevaricate over what – if any- state aid they are willing to offer in order to save the Tata operations at Port Talbot, Rotherham, Corby and Shotton (North Wales). At least 40,000 jobs are at stake.
Business minister Anna Soubry initially stated that the government was willing to consider “everything possible” – including nationalisation – in order to save the Port Talbot plant. But now her boss, business secretary Sajid Javid has ruled out nationalisation, arguing “if you look around Europe and elsewhere, I think nationalisation is rarely the answer.” According to the Daily Telegraph, Tata Steel have suggested that EU rules restricting state aid were to blame for its decision to sell the UK steel business – a claim that has been seized upon by campaigners for Brexit, including the supposedly “left wing” Morning Star, always willing to let the Tories off the hook by claiming (entirely falsely) that the British government “is banned by EU competition laws” from intervening to save the industry.
While it’s true that EU rules place some restrictions on using state aid to prop up industries, European governments with the political will have either turned a blind eye to the regulations or found ways round them. For instance, while the EU blocks support for “manufacturers in difficulties”, it allows national governments to nurture the “long term competitiveness and efficiency” of industry, and also to provide state funding to lessen the “social impact” of closures.
Even outright nationalisation is not barred by the EU: Article 345 of the Treaty on the Functioning of the European Union, states: ‘The Treaties shall in no way prejudice the rules in Member States governing the system of property ownership.’http://eur-lex.europa.eu/legal-content/EN/ALL/?uri=CELEX:12008E345
All across the EU states have majority shares or own and run their own transport and energy sectors. This is confirmed in this 2013 Estep report, commissioned by the EU: http://www.esparama.lt/es_parama_pletra/failai/ESFproduktai/2_UM_valstybes-valdomos-imones_2013-03.pdf
In particular the report states: ‘SOEs are entitled for public services provision, which can be broadly observed in utility sectors such as transport, telecommunications or energy.’
While nationalisation may be restricted it is not banned or illegal. This is a widely-believed myth, promoted, in particular, by the anti-EU “left”.
In Italy the government took control of the Ilva steelworks last year to save 16,000 jobs. Then the firm was handed £74 million for “environmental improvements” – ie direct state aid.
Germany also provides aid to its regional governments on the understanding that steel produced in the country is used on any German building or engineering projects. Germany also operates the part-publicly-funded Gesellschaft, a research organisation that provides applied science for companies that would otherwise find the cost prohibitive.
In 2012 French president Hollande threatened to nationalise Arcelor Mittal steel’s operations in the Lorraine plateau in order to save the blast furnaces of Florange and their 2,500 jobs. He didn’t seem to be particularly concerned about any EU state-aid rules. Ironically, Hollande’s threat was denounced by Boris Johnson – now a leading light of the Brexit campaign.
In a written answer to Labour Euro-MP Jude Kirton-Darling at the time of the Redcar steelworks closure last year, the European Commission confirmed that the UK Government could have given state aid to support the steelworks. Here are some of the ways that other EU governments have intervened to support their domestic steel industries, and other energy intensive industries. There are also examples of regional governments taking initiatives in Germany and Spain.
In early 2015, the Italian Government temporarily renationalised the Ilva Steel works in Taranto, Southern Italy. The Italian government cited the unabated toxic emissions and very poor environmental standards, which had led to unusually high rates of cancer in the area around the plant. It is estimated that it will cost €1.8bn to make Ilva compliant with the Industrial Emissions Directive’s standards. This decision is currently subject to a complaint from EUROFER (European steel industry association) under state aid rules.
Investment in strategic R&D facilities
The French government are providing state-aid to the ArcelorMittal plant at Florange, in France to support their ongoing R&D work, this follows on from a long running industrial dispute over the closing of two blast furnaces. This public support comes to a total of €20-50 million over 4 years, with a further 33 million been raised in public-private investment.
Support for energy efficiency/environmental technologies
In 2010, the European Commission accepted German state aid of €19.1 million for an energy-saving steel production project run by Salzgitter Flachstahl GmbH, a subsidiary of the Salzgitter AG group. The aid will allow Salzgitter to produce steel through an innovative production process, Direct Strip Casting (DSC), which consumes less energy than alternative processes. The aid is in line with EU guidelines on State aid for environmental objectives (see IP/08/80) because on balance, the positive effects for the environment largely outweigh potential distortions of competition.
In 2010, before the May elections (which saw a change in Government), the UK Labour government was willing to provide Sheffield steel producer Forgemasters with an £80m loan to develop new technologies as part of a supply chain for nuclear reactors. While ultimately the new government withdrew this offer, the reasoning for a change of heart was ideological and not related to European State-Aid rules.
Taking a public stake in a steel company
Following the sale of 20.5% of shares in ‘NLMK Belgium Sogepa Holdings SA’ for 91.1 million euros ($123 million), the Belgian public authorities have a shareholding in a new company producing steel which owns steel plants in Belgium, France and Italy. NBH employs about 1,000 people in Belgium, while the European division employs 2,530 people in total. The engagement of the Belgian public authorities has helped strengthen the commitment of the Russian group, and transformed the company carrying the steel business in public private joint venture with the financial support of the Walloon region.
Compensation for energy costs
A range of German Government industry policy interventions provide German industry as a whole, including its energy intensive industries, with a range of long established reliefs from energy and climate change-related duties, levies and taxes:
Over the period 2010-2012 Germany’s support for its EIIs were worth 26bn euros, or some 8bn euros (£6.4bn) a year (table 2).
Support covers thousands of firms. Unlike the UK package, support is not confined to specific sectors.
At company level, in Germany compensation is available for 90% (or in the case of larger and energy intense consumers, 100%) of electricity taxes.
In Sweden, the PFE programme aims to encourage, through incentives (reductions in the amount of energy taxes), energy-intensive industries to improve their energy efficiency. This is a long-term agreement involving the Swedish government, the energy-intensive industries and trade unions. The duration of this program is 5 years. 117 industrial companies are involved in this project (i.e. 250 plants). The Swedish Energy Agency monitors and controls the programme. The Programme Board, established in 2005, brings together representatives from government, business, trade unions and employers as well as research centers. Both with an advisory and regulatory purpose, the Board meets four times a year. After only two years of existence, more than 900 measures were implemented or underway. These measures cost the companies € 110 million but benefited from a rapid return on investment (two years on average). They have saved about 1 TWh per year of electricity, i.e. from 500 kT to 1 million tons of CO2, and a total of € 55 million. In 2010, it doubled its objectives.
Using the powers of the official receiver to support employment & attracting buyers for troubled plants
In November 2014, the Italian government agreed to sell Italy’s second-largest steelmaker Lucchini’s Piombino complex to family-owned Algerian conglomerate Cevital. Lucchini was previously owned by Russia’s Severstal but was declared insolvent in 2012 and placed into special administration. The company received two offers for its core assets in Piombino, one from Cevital and the other from India’s JSW Steel. The government administrator said the Cevital offer was more attractive as it foresaw full employment at Piombino. The Piombino complex employs about 2,000 people and can produce up to 2.5 million tonnes of steel a year.
By Pat Corcoran
The Unite report of its recent conference for members in the defence sector is at: http://www.unitetheunion.org/news/unpatriotic-government-policy-putting-defence-jobs-at-risk/ McCluskey says that his speech is not a nationalist rant. Which is the roundabout way of saying: it is a bit of a nationalist rant.
The book of conference motions for the 2016 Unite policy conference has just been published. There are 13 pages of motions about Trident renewal, ranging from full support to outright opposition. Most motions take the latter position. Unsurprisingly, the motion from the Aerospace and Shipbuilding National Industrial Sector Committee (NISC) does not. What that motion calls for is for Rule 2 to be upheld. Rule 2 of the Unite Rulebook is a commitment to protect members’ jobs and communities. As the motion puts it: “We are not a political party, we are a trade union.”
In fairness, Unite does face a genuine dilemma: Around 7,000 people in Barrow-in-Furness work for BAE Systems Maritime, with up to 10,000 more working for its suppliers. The firm is currently building seven nuclear-powered Astute-class submarines and planning the Successor programme to replace the aging Vanguard-class submarines, which carry nuclear missiles, ensuring jobs for 30 years. The industry is responsible for around one in ten jobs in the area and if the supply chain is taken into account it’s probably nearer one in five.
In addition, Unite has a long established tradition of respecting the wishes of its directly effected sectors when it comes to key industrial issues.
McCluskey and the overwhelming majority of the Unite EC would genuinely like to see nuclear disarmament, but they face a real dilemma: surely the first duty of a trade union is to defend the jobs of its members? The Aerospace and Shipbuilding NISC has a point about Unite not being a political party.
There is only one way to resolve this dilemma: Unite must commission an expert report into how to replace Trident-related jobs and put serious resources (ie financial resources) into coming up with a detailed, practical alternative jobs plan, just as the Lucas Aerospace shop stewards did in the 1970’s. Corbyn could also be offered support for abolishing Trident so long as assurances are forthcoming regarding a future Labour government safeguarding jobs. Sadly, there is no sign at the moment that McCluskey and the United Left majority on the EC are minded to adopt such a strategy.