TUC – this is a far cry from Roosevelt's New Deal
Commenting on prime minister Boris Johnson's speech in Dudley today (Tuesday), in which he claimed to be announcing a "Rooseveltian" public spending programme, TUC General Secretary Frances O’Grady said:
"The prime minister has just rehashed old promises. The £5bn of spending he announced today was reheated, and his spending commitments are worth just 0.2% of GDP. This is a far cry from Roosevelt's New Deal, which employed millions in public works in the midst of the Great Depression.
"Today we face the biggest economic crisis in a generation. Without big fast action, millions face the misery of unemployment. Today’s announcements from the prime minister fall far short of what is needed.
“The government needs to create millions of new jobs now. Far greater investment in infrastructure is needed to make those jobs a reality. And every project must be accompanied by a 2012 Olympics-style plan for jobs — prioritising local unemployed people, building skills and setting people up for careers.
“Today’s announcement is a huge disappointment. I hope next week's emergency budget will see ministers take some real action. If the prime minister wants to match the scale of Roosevelt's ambitions, he needs to deliver at least £150bn by 2024, not the reheated £5bn announced today.
"This crisis has exposed the huge inequalities in our labour market. It is women who are more likely to have volatile pay and hours; Black workers are disproportionately represented in low paid, insecure jobs — and too often have been put at risk during this pandemic.
"If the government is serious about 'levelling up' and helping those who have suffered under inequality, it needs to ban zero hours contracts and raise the minimum wage to a real living wage."
On the announcement of the "opportunity guarantee", to give every young person an apprenticeship or an in-work placement:
"What young people need is a guarantee of a job on a decent wage – not just a work trial. Getting young workers into jobs is how we stop young workers being abandoned to long-term unemployment, which will wreak havoc on their life chances.
"Decent companies are on the rocks in parts of the country where jobs on good pay are hard to find. There’s no point promising apprenticeships and work placements - whatever they are - unless there are real jobs for young people to go to."
Today's £5 billion on investment spending represents about 0.2 per cent of GDP, but it is unclear whether it is new or already announced spending.
Under the first five years of Roosevelt's New Deal government consumption and investment expenditures grew by 10 per cent a year. The government's current plans are for spending to growth by 5% a year. To match the new deal the government would have to up (current and capital) spending by a cumulative £30 billion a year starting this year through to £150 billion by 2024.
Other countries have announced recovery packages that are at face valuemuch bigger than the UK , but are not exclusively for investment.
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Germany have announced a package worth E130bn or 3% of GDP over two years, including a VAT reduction, one-off payment of 300 E per child , a new scrappage scheme and tax incentives for green investment and E300 per child.
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France have announced industry subsidies of E8bn for cars, E19.4 for tourism and E15 for aerospace.
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The EU have announced a stimulus of E750bn, which is 4% of GDP over 7 years.
The Trades Union Congress (TUC) exists to make the working world a better place for everyone. We bring together more than 5.5 million working people who make up our 48 member unions. We support unions to grow and thrive, and we stand up for everyone who works for a living.
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