Half a million workers strike over pay

LONDON Wed Jul 16, 2008 12:49pm BST

1 of 3. Local government workers take part in a strike over pay in central London July 16, 2008. Hundreds of thousands of local government workers went on strike on Wednesday in a dispute over pay that threatened to paralyse services from education to rubbish collection.

Credit: Reuters/Alessia Pierdomenico

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LONDON (Reuters) - Hundreds of thousands of local government workers went on strike on Wednesday in a dispute over pay that paralysed services from education to rubbish collection.

The pay dispute is a test of the Labour government's nerve at a time when it is languishing far behind the Conservatives in polls and trying to fight soaring inflation by forcing public sector workers to accept modest wage deals.

"Everywhere our members will be solid. Today and tomorrow nearly 600,000 of our members will be on strike. It will be one of the biggest strikes since the general strike of 1926," Dave Prentis, boss of the public service union Unison told BBC radio.

The Local Government Association, which represents employers, said it believed only about a quarter of staff would walk out, or 300,000 workers.

With inflation at its highest in over a decade, the Labour government is urging wage restraint to help contain prices. But public sector workers want more cash to offset rising costs.

Prime Minister Gordon Brown can ill afford to fall out of favour with Labour's traditional trade union supporters as he faces a risk of defeat in the next election due by May 2010.

"Local government workers are the core support for the Labour party and that is eroding," said Kenny Bell, a 57-year-old council worker on strike in Newcastle.

"Unless the government recognises our concerns they will not get re-elected in two years. The hike in fuel and food costs is hitting us hard. People are genuinely struggling."

A MILLION DAYS LOST

More than a million working days were lost to industrial disputes last year, the most since 2002 and almost double the annual average since Labour came to power in 1997.

However, Brown has shown no appetite for softening his stance on pay and government's current tussle with the unions is a far cry from the 1970s and 1980s when days lost to disputes averaged about 13 million per year and 7 million per year respectively.

In line with government policy, the Local Government Association has kept wage settlements for its workers broadly in line with the official 2 percent inflation target -- offering most staff a 2.45 percent increase.

Unions say that with inflation hitting 3.8 percent in June, that translates into a pay cut. Food prices are up nearly 10 percent on the year, petrol prices are up nearly a third.

The LGA says any further pay increases would result in higher council tax bills for households or reduced services.

"We have simply reached the limit of what is affordable," said Jan Parkinson, Managing Director of the Local Government Employers. "In the current difficult economic climate we do not believe it would be fair to add to people's burden."

Economists have said Britain could plunge into a recession as the housing market spirals downwards and activity across service and manufacturing sectors weakens sharply.

But rising inflation -- mainly due to soaring global oil, commodity and food prices -- have put the government and the Bank of England on high alert.

"We cannot allow inflationary wage increases because that would mean that everyone, especially people on lower incomes, would suffer and nobody wants to see those days again," Chancellor Alistair Darling said on Tuesday.

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