27 July 2015

We have the cure for industrial militancy


Back in power with a new majority, the Conservatives are squaring up for another face-off with the unions.

By “the unions”, of course, I mean the big public sector unions such as Unite, Len McCluskey’s fiefdom, which recently voted to rescind its commitment to obeying the law during strikes. So does nearly everybody who uses the term.

Private sector unions don’t tend to crop up on the radar these days. Since the last Tory regime outlawed flying pickets and sympathy strikes the sort of industrial action that once plagued Britain’s dying industries has simply disappeared from the modern economy.

Instead, unions in commerce and industry are conciliatory, pragmatic service providers, rather than proxy political armies, who focus on addressing specific grievances with individual employers rather than picking fights with the Government.

It is therefore strange that the current Tory reform programme, whilst sensible, doesn’t seek to apply to the public sector the cure for industrial militancy discovered more than two decades ago.

Setting thresholds for strike ballots and time-limiting the mandates thereof is all very well. But what if we could, without wholesale privatisation, abolish some of the artificial and arcane distinctions between public and private sector employees?

At present, public sector unions can still call politically-motivated national strikes because all their members share one employer, the state, whilst pay and conditions across whole sectors are set by politicians.

This could be solved with a bold, structural reform: make public service institutions legally-distinct, independent employers, who employ workers autonomously on private sector terms. They would receive public money through grants, but disburse it themselves.

For example, a teacher would be employed by the local school, not the Department for Education. She would still be providing a public service, and one paid for from the public purse, but she would not be a ‘public servant’ but an employee like any other.

Shifting to this model would see the benefits of private sector employment law flow into public services. With sympathy strikes impossible, the sort of sector-paralysing actions we’ve seen from teachers and others would fade into the past as their counterparts in commerce and industry have.

Trades unions would need to concentrate their efforts on genuine grievances with individual employers, rather than a remote minister or policy.

It is harder to demonise those you work with on a daily basis, and easier to grasp the financial restraints facing an individual institution. As a result, the new logic would help to shape unions on private sector lines.

Moreover, if married to programmes that increased user choice then union members would have a vested interest in their place of work being a reliable, cost-effective and attractive option for parents (or patients, or whomever), a further discouragement to militancy.

The unions know this, which is why they and their Labour allies are determined opponents of any measure which empowers the users of public services to make informed choices, be it the opening of new schools whilst bad schools stand half-empty or the introduction of league tables, which has been reversed in Wales.

Nor need the benefits stop there. The decentralising of employment and decision making would also make it harder to resist important reforms.

Controversial measures, such as regionally-variated and performance-related pay, would occur organically as a result of thousands of individual decisions, just as they do in the private sector.

Whilst those reforms remain subject to a minister’s orders those opposing change can concentrate resistance on a single point – and a point acutely susceptible to political pressure, at that. In contrast it is no more possible to imagine such things failing to occur in truly decentralised public services than in the modern private sector.

This could allow schools in areas with lower costs of living and average salaries to channel more money into facilities and other areas of the curriculum, helping to bridge the persistent attainment gap between children of different incomes which the current comprehensive school system only exacerbates.

Other union practises, such as the teaching unions’ making poor-quality teachers effectively un-dismissible and bouncing them between institutions, would also become unsustainable.

A shift to private sector employment patterns would produce a substantial saving for the Treasury, not least in the long run by bringing public sector pension schemes into line with their reality-based private sector counterparts.

This dividend could be ring-fenced and re-invested in schools, or passed on to taxpayers.

There would of course be some initial difficulties. Schools and other institutions would face new burdens as they lost the benefit of huge national human resources departments. Yet such burdens are borne by every business in the land and besides which, solutions could be sought within the new framework.

Public service institutions could band together of their own volition to pool resources, much as academy chains already do. Unions could provide their members with additional training and professional accreditation, incentivising membership and making life easier for employers.

If further inducement was needed to sell this reform to our highly political Chancellor, the advantage to the Tories of a dramatic spread in private sector employee attitudes speaks for itself.

Advocates of capitalism cherish a system where people get on by meeting the needs of customers, rather than influencing those in power. This is not yet true of our public sector, which is why McCluskey and his comrades flourish there.

We have known the treatment for industrial militancy for decades. If this truly is to be a bold, reforming Government, it should serve the medicine.

Henry Hill is Assistant Editor at ConservativeHome.