Labour leadership rocked
Revolt erupts over pensions
THE LABOUR Party conference last week represented a new stage in the revolt against New Labour's pro-business policies.
Delegates did not confine themselves to muttered dissent in fringe meetings. They defeated the leadership in a high profile confrontation. The revolt over pensions rocked Tony Blair and chancellor Gordon Brown.
The motion passed demanded that the value of the state pension should be protected by "an immediate and substantial increase in the basic state pension and by linking the basic state pension to, for example, average earnings or inflation, whichever is greater".
The leadership has aggressively set its face against this position for the past three years. Yet after a long and sharp debate the overall vote was 60.21 percent for the motion and 39.79 percent against.
The unions secured this result. They voted 84 percent for the motion to 16 percent against. This compares to the constituency delegates who voted 64 percent against the motion to 36 percent for it.
The leadership had tried every possible manoeuvre to defeat the motion. Tony Blair and Gordon Brown held meetings with union leaders Rodney Bickerstaffe (UNISON), Bill Morris (TGWU) and John Edmonds (GMB).
Small concessions were offered. At the same time it was implied that the only people to benefit from the motion being passed would be the Tories.
The union leaders wobbled, but they did not withdraw. They knew they would face a storm of protest from their delegations, from their wider membership and from pensioners if they backed off on the most central issue of the week.
The leadership then tried to fix the way it would be discussed. Alistair Darling, social security secretary, was allowed to hold a long "question and answer" session before the debate began. This allowed him to put forward his position on pensions for an hour.
When UNISON's Rodney Bickerstaffe raised the motion, he stressed that he did not blame the government for the plight of pensioners.
However, he said, "Pensioners have put their faith in the basic state pension and they believe that the earnings link is the only way to protect the pension."
The leadership tried to justify its opposition to the link by using a left wing cover. It said its present policy was "putting the poorest first" and was "redistributing from rich to poor".
Some speakers said restoring the earnings link should be opposed because it would mean giving money to the rich like Margaret Thatcher and Norman Tebbit. GMB union leader John Edmonds cut through these arguments.
"Let's have no more nonsense about the earnings link taking from the poor to give to the rich," he said. "If we don't want rich pensioners to have the full benefit of large pension increases there's no problem. We have a time honoured system to deal with problems like that. It's called the tax system. The value of the basic state pension has been falling steadily for 20 years. The 'foundation stone' is sinking beneath our feet. As its value falls, more and more pensioners have to face the means test, a painful punishment for most."
Several delegates made long speeches which came down to a single plea-trust Tony, trust Gordon or you will help the Tories. This demand for loyalty was met with some jeers and a degree of anger.
As the debate ended, the conference chair asked Rodney Bickerstaffe if he would withdraw the motion from a vote. Amid great tension he refused. After the vote the leadership made it absolutely clear they would ignore the conference. This can only stoke people's anger even more.
Seven facts you need
1. Alistair Darling claimed the Minimum Income Guarantee was the best way to help the poor, rather than restoring the earnings link.
He said that under the guarantee the poorest pensioner gets �78.45, rising to �90 in the future. But if the earnings link had not been ditched, the single person's pension would be �97.45.
2. The Minimum Income Guarantee is simply means tested income support paid at a slightly higher rate.
3. Somewhere in between 700,000 and one million pensioners do not claim the Minimum Income Guarantee because they do not understand it is available, are intimidated by the procedure, or feel it is undignified to go through the means test.
This means the government "saves" up to �600 million a year.
4. Alistair Darling said that, although restoring the earnings link was affordable at present, it would not be in the future. But the whole point is that pensions rise along with the average rise in earnings.
Each rise in average earnings produces more tax for the government. So if it is affordable in one year then it remains affordable.
5. Ministers could raise an extra �48.5 billion a year for pensions and other needs by putting corporation tax back to its 1979 level, scrapping the upper limit on national insurance contributions and taxing the rich at the levels when Margaret Thatcher came to office.
6. New Labour's real agenda is to let the state pension wither and force everybody to take out some form of second private pension. Ministers are keen on introducing a Pensioner Credit.
This would give a little extra money to pensioners who are currently barred from receiving benefits because they have a small occupational pension or savings.
7. Alistair Darling said that at present one in six pensioner couples retire on �20,000 a year or more. But �400 a week, although not dire poverty, is hardly a vast amount for a couple.
Several newspapers reported that Darling had said one in six individual pensioners retired on over �20,000 a year, a completely wrong figure.
Vouchers must go
THE government could have been completely defeated over vouchers for asylum seekers. But over this issue its combination of concessions and arm-twisting worked.
Most delegates-both from unions and the constituencies-are outraged by the voucher system.
Sylvia Simmonds from UNISON argued, "The government has kept all the oppressive features of past Tory legislation and added some others. Its asylum policy perpetuates the culture of suspicion, racism and xenophobia. Has the government been sympathetic to those in need? No! The legislation is inhumane."
Jamil Akhtar from Colne Valley said, "In Kirklees, west Yorkshire, 50 refugee families arrived recently. But there were no arrangements for them to use vouchers at butchers selling halal meat. So for three months they were reduced to eating vegetables."
Motions calling for vouchers to be abolished and replaced by cash benefits were put together-"composited".
This process meant the motion only said that conference "registers its opposition to the voucher scheme".
Even so this would have been a powerful blow against vouchers. But the motion was never put. Instead Bill Morris of the TGWU union withdrew the motion in favour of a promised government review and for refugees to receive change from the vouchers.
Much more could have been wrung from the government. It is on the defensive over this issue, and further pressure can win more gains.