Michael Doyle

Michael Doyle

The workers’ movement and the coming Labour government

Reading Time: 4 minutes

The General Election was called earlier than expected – and that means that the upcoming battle with a prospective Labour government will now be brought forward. This battle will be on multiple fronts: the party’s ongoing support for the genocide in Gaza, Wes Streeting’s reforms of the NHS, and on economic policy. In this article, I will focus on economic policy and the so-called ‘New Deal for Working People’.

For context, it is worth revisiting Rachel Reeves’ Mais Lecture, billed as both a continuation of Thatcherism and a break from New Labour. Tory newspapers were briefed that Reeves would be the heir to Thatcher; centrist publications praised it as a substantial break from New Labour’s political economy and that Reeves was being bold. A separate debate has been occurring on the left as to whether neoliberalism is on the way out, and has been linked to Reeves’ speech. Some argue that Reeves was making a substantial break from neoliberalism and was developing a new form of political economy, citing her emphasis on restricting free trade, an interventionist industrial policy and a new bargain for organised labour. Others have argued that Reeves’ prospectus is a continuation of neoliberalism based on her commitment to the Tory fiscal rules which will prolong the austerity first introduced by the Coalition government in 2010.

Neoliberalism denotes characteristics of the capitalist mode of production that prior iterations of the system did not possess. The most obvious in the UK context being the transition from the post-war social democratic tripartite political economy (the state, capital and the trade unions), to a dualist political economy (the state and capital) which using the power of the state, legislated repressively against trade unions. Moreover, even with the passing of one iteration of capitalism, residuals remain in the next iteration. For example, in 1976 as James Callaghan declared the end of Keynesianism and the adoption of neoliberalism via an IMF structural adjustment program, the old corporatist policy of centrally imposed wage restraint in collaboration with the Trade Union General Secretaries persevered.

Whilst we may be in the process of transitioning to a new iteration of capitalism (perhaps a new form of corporatism), the key precepts of neoliberalism remain in Labour’s economic policy: reduced public spending on public services, market-based reforms of the public services and an emphasis on preserving the existing balance of power and wealth between capital and labour. One of the key philosophical shifts in labour relations from the Keynesian to the neoliberal periods was an emphasis on the individual in the workplace, rather than the collective. This underpins the agenda of workers’ rights of both the last Labour government and the likely incoming one.  

The labour movement was weakened by the neoliberal onslaught of the 1980s, and despite the intermittent outbreak of strike action over the past couple of years, remains weak. In 2021, Labour deputy leader Angela Rayner proposed a white paper that guaranteed a plethora of rights to workers within the first hundred days of a Labour government. It is not untypical for Labour leaders to promise new rights for workers at a party conference. In 1995, addressing the Labour Party Conference (a place where Labour leaders and ministers know they can get cheers from the audience when playing some left-wing tunes), Tony Blair stated that “part-time employees will no longer be treated as second-class citizens. There will be an end to zero-hour contracts”. In power, Blair ditched the pledge to end zero-hour contracts and introduced paternity leave and consistently stated he wanted a partnership between business and trade unions, but this was within the individualist framework bequeathed to him by his Tory predecessors. Blair’s only concession to the unions was the legal guarantee of a ballot for a workforce to have the right to union recognition. Even when begrudgingly giving this concession, he was at pains to insist that Britain would still have the most lightly regulated labour market of all major economies.  

In her Mais Lecture, Reeves promised a ‘new deal for workers’ which would grant workers new rights as well as repealing some of the post-2010 anti-trade union laws. Some hailed this as a break from neoliberalism. Workers would be protected from unfair dismissal however, Reeves heavily caveated the point about unfair dismissal with the reassurance to business that ‘fair dismissal’ and probationary periods would be protected. Furthermore, the policy that the gig economy employers most feared when the agenda was unveiled in 2021 was the move to a single status of worker guaranteeing full rights including sick pay, pensions auto-enrolment. This very much fits with the individual rights agenda, but it has been diluted to a mere review. Even the section on strengthening collective bargaining is focused on the needs of business. Starmer’s commitment to strengthening collective bargaining is about reducing strike action and disruptions to business.

There is nothing about increasing wages and achieving better terms and conditions. Labour’s position on the industrial action of the past few years is one of supporting keeping pay increases below inflation – an example being the sacking of a Labour shadow minister who expressed support for the RMT’s demand for above inflation pay rises in 2022.  

The story of employment law in the neoliberal era is one of individual rights – if they are business friendly and do not impact on making profit. Labour is not deviating from that. Rather, they continue to propagate the line that business and the unions must work in a partnership. This might sound like the corporatist arrangement of the post-war period, but as documented above it is really continuity neoliberalism. It is clear the trade union bureaucracies will not hold Labour to account given they have provided the Labour leadership cover for this pitiful agenda. Political education at the base of the trade unions will need to be improved and as so often, it is lessons from history that can guide our teaching and our praxis today. Under Labour governments in the 1960s and 1970s, workers were able to exert their power to improve their living standards.  

We must not forget those lessons, but remember them and once again emphasise the collective over the individual.  

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