Colin Burgon MP – Guest Speaker

After dinner local Leeds Labour MP for Elmet Colin Burgon spoke to seminar delegates. (Usual health warning on posts made from hastily scribbled and illegible notes).

Colin is proud that he is born and bred in Leeds and actually went to school with our UNISON General Secretary Dave Prentis. He is retiring at the next election (he is 62 and I think he was therefore more relaxed and “off message” than other Labour MP’s who busy campaigning for re-election).

He began his speech by reminding the audience of the current strike in Leeds by UNISON/GMB dustbin and street cleaning workers. The dispute is about an attempt to cut their wages by £2-6k per year over single status. The strike has been well organised and solid with good co-operation between the unions and Colin is confident that it will succeed. A delegation from the seminar is going down to support the Picket line in the morning (see next post).

Colin managed persuasively to link the Leeds dustbin strike to Latin America! The Economic Neo-liberalism that was introduced into South America by the military dictatorships in the 1980’s cut public workers pay and privatised services and this is the same model that Leeds City Council (Lib Dem/Tory) wants to introduce. People are treated as “Consumers not Citizens”.
Colin is Chair of the All Party Committee on Cuba and Labour Party Friends of Venezuela. He has a lifelong interest in internationalism.

Colin was born in 1948 which he believes was also a start of a Golden Age for the British Working class which ended after the Oil Crisis in 1975-79. This was a time of full employment, rising living standards, dignified jobs and a sense of working class consciousness. He mused on the retreat of the left not only in the UK but in recent elections in Germany (vote for the SDP at 60 year low) and France (Socialists on 17% and Communists have practically disappeared). He blames this on the acceptance by social democratic parties of the current market led intellectual framework.

He is firmly against the “Professionalism of Politics” and warned everyone that many ordinary working people think that nobody talks to them and nobody listens to them. Controversially (not least for an avowed internationalist) he also attacked the free movement of Labour in the EU which he thinks undermine the terms and conditions of UK workers. An incomes policy by any other name. Colin is very critical of New Labour but believes passionately that Labour is the only Party for working class people for all its faults. The Party is still on its historic mission. The NHS is to him an example of “Socialism in Action”. He fiercely challenged and corrected some negative questions about the Party during the following Q&A.

I managed to ask Colin a question by firstly pointing out that we all in this room shared common values and the objective of a fairer society but we just can’t all agree on the means to bring this about. So I asked my usual question about the possible role of pension fund governance and “Workers Capital” in changing society? Colin apologised that he did not know enough about “Workers Capital” to answer the question. Which is unfortunately is the answer I get often get whenever I manage to ask this question at such meetings (us New Capitalists need to try harder).

Picture of Colin (3rd from left) with Colombian Congressman Borja; John Cruddas MP and UNISON Deputy General Secretary Keith Sonnet at the Labour Party conference - from Justice for Colombia

We are the Masters Now

Okay, slight exaggeration. Neither did Gordon Brown “Save the World”, but now that the dust is settling on yesterday’s part Nationalisation of the Banks – the “commanding heights of the economy” (or Reverse Clause 4 Moment as Tom P puts it so aptly) we can see that there has been a massive failure of capitalism.

Don’t get out the barricades yet comrades, as I am certain that the economy will recover – it always does. Spectacular collapses in markets is after all the nature of the beast. Whether it’s Tulips, South Sea shares or toxic sub-prime mortgages, its meat and drink to capitalism. Of course who knows in Politics, maybe something else is happening, I doubt it, but this is one of the reasons why it can be exhilarating at times.

But I think that the pendulum has shifted. The relatively unfettered and deregulated “anything goes” free market capitalism has had its day! What we need to do is examine what went wrong, why it went wrong and would needs to be put in place to try and stop it happening again. In the long run this is probably a worthy aspiration rather than an achievable goal. But the scale of the current disaster was not inevitable.

My thoughts for what it’s worth are that we’re all at fault. To a lesser or much greater degree. Small savers in this country via their pensions and insurance policies own a majority of shares in this country. However, despite being owners we allowed incompetent executives to be appointed to run our major financial institutions into the ground. Huge bonuses were paid in return for short term gain regardless of long term sustainability. Hugely complex financial products which practically no-one understood were developed and bought by managers on our behalf without any awareness of the risk. This is what happens when our fund managers act as traders not investors.

Regulators allowed credit agencies to give companies AAA scores even though they were being paid by those companies to do so. Government’s of all political persuasions allowed a flawed economic and regulatory framework.

Now the ideological model has crashed we can pull away from Reaganomics and Thatcher's "big bang" to re-establish meaningful checks and balances. Let the pendulum swing back. Workers capital can play its role. We must change the governance arrangements of the companies that we own to make sure that the interests of its real owners is pursued. No longer should our capital be used as vehicles for speculators to risk our money to make them massive bonuses.

Gordon may have not saved the world, but well done. I think that the way the government has decisively responded may well help save its bacon at the next election. Cameron and his team have appeared to have no substance to them and their deregulatory free market credibility is in pieces.

Union Trustees take on Global Capitalism

Okay, okay, Tom P and I are trying to use the most attention seeking headlines possible in order to publicise the meeting of the "Fourth International" of lead union trustees that will take place in London on 8th-10th July.

I was lucky enough to go to last year’s conference in Geneva, Switzerland at the ILO (see picture of participants above). It was an excellent and inspiring event and I hope that as many trade union pension reps as possible can participate in this years event.

It seems that the possible British Local Government strike over pay will not take place that week, but the week after.

This is from the TUC press release. “The event is being organized by the Global Unions Committee on Workers' Capital (CWC - www.workerscapital.org) to facilitate international dialogue and information exchange between union trustees.

Key themes for discussion include the UN Principles for Responsible Investment, Burma, private equity, labour issues in an investment context, and capital stewardship campaigns. The July 9 meeting will be chaired by John Maitland (ACTU, Australia) and hosted by the TUC. On July 10, trustees will be meeting with a number of London-based campaigning, corporate social responsibility and investment organisations.

If you would like to attend, please let the CWC Secretariat know by emailing workercapital@share.ca Attendance is free, but please note that CWC is unable to assist with travel or accommodation costs for the meeting”.

The New Internationalist Capitalists

Back this morning from annual meeting of the “Committee on Workers Capital” (CWC) held in the International Labour Organisation’s headquarters (ILO) in Geneva. A superb one

day conference for international labour movement activists, who are involved on workers capital issues.

The chair of CWC is Ken Georgetti, who is President of the Canadian Labour Congress. Canada seems to be taking the lead on worker’s capital. John Maitland, from the Australian Council of Trade Unions (ACTU) chaired the actual meeting.

There were nearly 40 participants from all round the world. Australia, Brazil, Canada, Denmark, France, Netherlands, Iceland (who was also an MP), UK and USA. I went to the meeting in London in 2005 and there was probably nearly twice as many people present this year as then. From UNISON there was also national officer for Capital Stewardship, Colin Meech, and from the TUC senior Policy Officer, Janet Williamson. Janet gave two presentations on the TUC response to Private Equity in the UK. Also present was David Russell from the Universities Superannuation Scheme (USS) and Donald McDonald who is a BT pension scheme trustee (and Chair of PRI).

Some of the pension schemes represented even dwarfed the £125 billion invested (collectively) in the British local government pension scheme (LGPS).

Check out the CWC link for the full picture on the Labour movement and investments (I’ll do a further post on this issue later). The themes for this year meeting were a “Trustees approach to the UN Principles for Responsible Investment “ (PRI - we must get all British schemes to sign up to this campaign). There was than a lot of good stuff on trade union approaches and initiatives on Private Equity (PE); assessing its risk and market distortions, making PE work for us, and PE “due diligence”. There was a very wide ranging discussion. Finishing off with debate on common problems and issues.

Potentially one of the most significant things that the CWC does is to operate a “clearing house” for international trade unions to post requests for assistance or information about international companies who are operating in their country. Recently we had a fairly successful campaign in the UK by the T&G and the Teamsters to try and persuade First Group not to practice anti-trade union activities in the US.

It was good to meet Mike Musuraca from the New York City Employees Retirement System (NYCERS). He is also an official with the American Public sector union (AFSCME). They appear to be far more proactive with their pension fund than we are in London with the LGPS. It would be good to keep in contact so we can get share some ideas.