Unite warning on cuts

The coalition's threat to slash public spending by between 25 and 40 percent will destroy nearly as many private sector jobs as public sector ones, Unite, the country's largest union will warn at the national demonstration against the cuts today (Tuesday 19 October).

Ahead of tomorrow's comprehensive spending review - set to unveil the heaviest cuts in public investment in generations - Tony Woodley, Unite joint general secretary, will tell the rally of workers that for every four public sector jobs forced by government, three more will follow in the private sector: "The coalition has no brief for the devastation it is about to unleash on this country. Cuts on this scale make no sense. Business knows it needs the public sector to fill the growth gap created by a struggling private sector. And the people of this country, who most need their public services to help them during tough times, did not vote for the dismantling of their schools, hospitals and communities.

"Where is George Osborne's plan B which will see the government grow the economy through investment, implement pain-free taxes on the banks and pursue the real `muggers', the super rich who avoid their tax obligations to this country?

"For every four jobs lost in public services, three more will follow in private industries. This is not a price worth paying.

"Make no mistake, if this government forces through its brutal programme, Britain will not become a stronger economy - it will become a bleaker and more divided country."

Using research produced for the Scottish government (see note below), Unite has found that for every 1,000 public administration jobs cut a further 700 - at least - will follow in the private sector.

Unite also believes the true extent of the cuts will be to take a colossal £145 billion from the economy. This is based on the government's statement in the June budget that it will cut total managed expenditure by 7.7 per cent of gross domestic product (GDP) over six years. This amounts to cuts of £108 billion, but as total managed expenditure also includes debt interest payments, this adds another £36.6 billion over the six years. That means the spending on services, benefits and jobs will be cut in real terms by £145 billion.

Unite has been pressing for the government to abandon a cuts-only policy and focus instead on growing the economy through investment. The union is releasing a briefing paper, Dealing with the deficit - there is a better way, which shows that:

Coalition cuts are ideological, not economic

Germany, France and Japan have all got higher net debt than the UK.
In April 2010, the IMF stated the UK has the lowest government debt as a proportion of GDP in the G7.
Hundreds of thousands of jobs will go

The Treasury predicts the cuts will lead to at least 500,000 public sector jobs losses and between 600,000 and 700,000 private sector jobs in the next four years.
For every four public sector jobs cuts, three more will follow in the private sector.
Unemployment is expected to surge above 10 oer cent in half of our regions by 2015.
Public sector spending cuts could reduce private sector gross output by around £46 billion per annum by 2014/15.
We are not all in this together

The cuts will make the poorest 10 per cent of households will be worse off by £1,514 a year - or 21.7 per cent of household income.
The richest 10 per cent of households will lose just 3.6 per cent of their annual household income.
With 65 per cent of the overall public sector workforce female, women will be hit harder by job cuts and the two year pay freeze (2011 - 2013).
Female unemployment now stands at one million; over 200,000 18-24 year olds have been out of work for over one year.

There is a better way

While the coalition cuts support to families the banks are allowed to defer paying £19 billion in corporation taxes.
Wealthy companies and individuals cost the country £25 billion a year in tax avoidance.
£4.7 billion can be raised by introducing a 50 per cent tax rate on incomes over £100,000.
A tax on the banks, derivative trading and major hedge funds of just 5p for every £1,000 transacted could generate $400 billion globally; in the UK tens of billions of pounds could be generated.
For every £1 billion spent on health, education and social work there is an increase in demand in the economy worth £1.854 billion.
Where is plan B?

The government has no strategy for growing jobs. It has denied a loan to Sheffield Forgemasters, is ending the Future Jobs Fund and scrapping the Regional Development Agencies.
In July 2010, the markets reported that UK deficit had narrowed, reducing government's borrowing requirements and prompting many to ask, why cut so hard and so deeply?

Tony Woodley is to address the TUC-coordinated rally in defence of the public services, which will be held at Westminster Central Hall from 12.30 on Tuesday 19th, before leading Unite members to lobby MPs for their help in resisting the slash in spending. Hundreds of Unite members will be attending the rally from across the UK.