Storm Cones Hoisted
By JOHN COLE T'r looks as if there is going to be a hard jwinter in industrial relations. The storm cones are being hoisted on every side: by power- station men and teachers, engineering workers and civil servants, railwaymen and Post Office engineers; and it will be surprising if we do not have a major official strike before the spring.
Much depends, of course, on how deeply Mr. Selwyn Lloyd has dug in his heels and how seriously the two sides of industry take him. It would not be the first time that a government has talked tough and acted timorously, having achieved part of its objective by bluff. There was the famous warning •Li 1957 that civil ser- vants would get any wage increases which the arbitration tribunal awarded them, but that the cost would be met by `compensating economies' -7-men would be dismissed to keep the total wage bill unchanged. The threat made a great flurry in the newspapers, but it turned out to mean very little, as the Treasury had known from the start. The Chancellor's call for a `pause' in wage increases this year, therefore, may not seem an uncompromising by the spring.
At the moment the minds of all the economic pundits, from Lord Amory to the Council on Prices, Productivity and Incomes, seem to be running towards a rationalisation of the wage- bargaining machinery, designed to make it more sensitive to productivity. Because workers in manufacturing industries must not be allowed to run away from the rest in the wages race, the argument is, some national estimate of increased productivity must be produced—probably by ex- perts under the supervision of a body drawn from employers and unions—to form the background to negotiations in individual industries and services The scheme has some obvious disadvantages. It removes the idea of direct incentive in the Progressive industries; and it would demolish at a stroke a number of criteria that have been established—at some expense, by way of Royal Commissions, committees of inquiry and the like —for settling wages. Most notable is the principle of comparability. Can the Government seriously argue that when it set up the Guillebaud Com- mittee it did not establish the principle that the Wages of railwaymen should be related to those of workers in outside industry? If it did not, then the whole exercise was a scandalous waste of public money, far too expensive a way of settling a single wage claim. And what about the Policemen? It is all very well for people who become concerned with the wage and salary machinery once in a lifetime to produce their formula; for yet another piece of tinkering. But each time that we grasp at another expedient, and forget what has gone before, faith in and respect for constitutional industrial relations dwindle.
What has been most disturbing about events in the civil service during the past week is the quite cynical disregard for long-term conse- quences displayed by the Government—and by some newspapers who ought to know better. The Civil Service National Whitley Council is based on an agreement which lays down arbitration as the end of the road where negotiations have failed to produce a settlement. It is true that it is not specifically stated that the date on which an award of the tribunal should operate must also be arbitrable. But can there be any doubt? For if a tribunal's award has no compulsory date attached, any employer who wants to save a bit of money would simply say : 'Very well, you can have your extra tuppence an hour in 1984'; and that would effectively end any faith in arbitration.
In any event, if others had any doubt about what the agreement meant, the Treasury has not. It issues a booklet to new entrants, which says, quite gratuitously, that the Civil Service Arbitration Tribunal fixes the dates; and this has also been standard practice for many years. Mr. Lloyd has now decided to suspend it, for rea- sons of public policy. Now, all this may look like a technical matter, too difficult for the lay- man to understand. But there should be no doubt about what the Government is doing. It is chipping away at a valuable part of the citizen's rights—the system of free bargaining on salaries and incomes.
What is worse, Ministers scarcely seem to realise this. Did the Chancellor, for example, understand that the principle he is following is 'the end justifies the means'? If the Government can, suspend an agreed and established rule just because it finds it expedient to do so, it can also change other rules. But so can other people. It is of little use that the Minister of Labour should call meetings of employers and unions to end wildcat strikes, and to induce workers to keep agreements signed by their representatives, if the Government itself regards its pledged word as subject to the exigencies of the service. Yet these are the kind of arguments that the Times apparently regards as Irrelevancies'—an opinion for which Mr. R. A. Hayward, the civil servants' leader, administered a gentle, but richly de- served, rebuke. What is not irrelevant is that some of the nationalised industries, where trade unionism is less mild, also have compulsory arbitration clauses. In all logic, the Government ought to tell the Railway Staffs National Tribunal that it cannot fix the date of an award either. Let the Tribunal make its award sometime about Christ- mas, to bring the railwaymen up to the level they enjoyed briefly after the Guillebaud report; and then let Dr. Beeching announce that they will only get the money—not even back-dated- when the Government has ended the pause: does anyone ,think the railway unions would stand for this?
It all makes a poor start to the Chancellor's long-term plan, which must be based firmly on co-operation. Not that there is any evidence in recent experience that either side of British in- dustry is prepared or able to accept the kind of central authority needed if a Swedish system of wage negotiation is to work. The Government would do better to devote its energy to two things which offer good long-term prospects. It should encourage and help individual industries to use productivity (in manufacturing) and efficiency (in services) as a far more important factor in wage-fixing than at present. For a start, the machinery for measuring these needs to be improved, since unions and employers enter negotiations with dramatically different analyses of how their industries are doing.
But all wage negotiations take place against two inescapable facts of the labour market. What is the lowest wage at which an employer can hold the number of workers he needs? What is the best price that a man can get for his labour? The law of supply and demand operates quite inexorably. As long as there is chronic labour scarcity in the Midlands and South-East, the service industries, for example, will pay more than they can afford there, and because of the system of national negotiations, this will distort the whole pattern. As long as there is unem- ployment in Scotland, Northern Ireland, Mersey- side and Tyneside, labour will be cheaper there. The wage pattern can only be made more logi- cal and less inflationary if supply and demand are more nearly equated in each area.
'1 suppose they had to let Kenyatta out to make room for that feller Kaunda. . .
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