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The Guardian - UK
The Guardian - UK
Business
William Keegan

Nurses’ pay squeeze and Tory tax cut ambitions: can they perhaps be related?

A group of nurses showing their placards to the camera, including one that says 'NHS hero? My purse has zero'
Striking nurses outside St Thomas' Hospital in London. Photograph: Vuk Valcic/SOPA Images/Rex/Shutterstock

Before we get on to Brexit – don’t worry: we shall – I want to draw attention to what I regard as the epitome of the meanness and duplicity of what is indubitably the worst government of most of our lifetimes.

Sorry, did I say “government”? A neighbour asked me the other day if I was aware of a new oxymoron. Tell me, I replied. “The very phrase ‘Conservative government’,” he said.

Anyway, it appears that while the “government” has been boasting about its “landmark” award to the teaching profession, this turns out not to be an award at all. The money must come from existing educational budgets – in other words, from further cuts to the money our valued teaching profession has available for, well, schoolbooks, school meals and other necessary investment in the education of our younger generation.

It is all part of an ideological assault on the public sector that has been in progress – if that is the word – since the advent of the Conservative-Liberal Democrat austerity coalition of 2010-15, and then the full-blooded extreme rightwing continuation of austerity from 2015. This nasty policy permeates most parts of the public sector. I won’t bore you with the daily catalogue of its manifestations, but what I and many economists feel strongly about is the damaging and unnecessary squeeze on public sector pay.

There is absolutely no causal connection between decent pay awards to nurses and a so-called inflationary spiral. But there is – and I find this seriously offensive – a connection between this government’s policy of being as parsimonious as it can get away with on public sector pay awards and its desire to attempt tax cuts on the eve of the next general election. Yes, the “war chest” thinking is that cynical.

Which brings us back to Brexit. In the vanguard of the tax-cutters are the extreme rightwing Tories known by the misnomer of the European Research Group (ERG). (Research is not in their bailiwick. Anti-European propaganda is.)

A leading member of this group has been Jacob Rees-Mogg. Among his vociferous allies are David Frost and Daniel Hannan. Lord Frost played a major role in the construction of the terms under which this benighted nation left the European Union and single market. Lord Hannan – about whose trustworthiness I have had my own private experience – is on record as having promised that we would never leave the single market.

As readers know, the opinion polls show that a majority of the public regard Brexit as an unmitigated disaster, and there is a growing preponderance of respondents who would like us to rejoin the EU – or at least the single market.

We now hear of plans for a major pharmaceutical company, AstraZeneca, to expand in Ireland, not the UK. And Nissan, once considered the pride and joy of Sunderland (yes, Sunderland voted for Brexit) is now reconsidering its commitment to the UK.

A little history is not irrelevant here. When the famous “Thatcher experiment” was not proving all it was cracked up to be in the early to mid-1980s, attracting foreign investment, especially Japanese investment, became the linchpin of British industrial policy. The incentive for the Japanese – Nissan, Toyota and others – became our membership of the single market, which Mrs Thatcher assured investors we were committed to. This gave the Japanese a firm base in the broader European market. Alas, these latter-day ERG characters are betraying the undertakings of their sainted former leader.

Now, serious Europeans such as the EU’s former Brexit negotiator, Michel Barnier, and others are telling us “the door is still open”. This worries Brexiters such as Frost. Notwithstanding that Labour is being pusillanimous about this, and, absurdly, ruling out re-entry, Frost worries that “many in our political and business establishment want to unravel the deals we did”.

Of course they do. The whole episode needs to be unravelled, and there should be a public inquiry. But what we rejoiners have to watch is the retained EU law bill that Rees-Mogg, Frost and co are championing but which, thank goodness, is being challenged in the House of Lords by Frost’s excellent fellow peers, among them Lord Kerr of Kinlochard and Baroness Wheatcroft.

Why are Rees-Mogg, Frost and co so keen on a precipitate bonfire of about 4,000 pieces of EU legislation – legislation that we, as members of the EU, had a major hand in drafting? (To name but one: legislation to clean up our rivers. To name another: decent standards of hygiene. Well, I don’t need to go on.)

Why? Because they know how difficult it would be for the UK to negotiate re-entry to the single market if the process of adherence to those 4,000 items had to be begun again.

This is a huge issue, and I take off my winter hat to those members of the Lords who are prepared to fight the good fight in the interests of all of us – all except those lunatic Brexiters.

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