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TUC calls for urgent economic reset to tackle huge Covid class divide

Two-thirds of young people believe their generation will be ‘permanently disadvantaged by pandemic,’ poll finds

by Our Parliamentary reporter @TrinderMatt

THE Tories have been warned to act on the huge class divide exposed by the Covid-19 pandemic, as a new report details how low-paid workers are bearing the brunt of crisis.

The TUC is demanding urgent action as its research, published today, suggests “a tale of two pandemics.”

Those earning less than £15,000 a year are almost twice as likely as those earning more than £50,000 per annum to have cut back on spending since the pandemic began, the research found.

High earners are also more than three times more likely than low-paid workers to expect to receive a pay rise in the next 12 months, the report states.

TUC general secretary Frances O’Grady pointed out that workers on low incomes have had little or no option to work from home during the pandemic, as well as a lack of sick pay and reduced living standards.

Better-off workers have meanwhile enjoyed greater flexibility, financial stability and increased spending power during the pandemic, she said. 

Ms O’Grady noted that Prime Minister Boris Johnson had been talking about his “levelling-up agenda,” but asked: “Where’s the action?”

“It is nothing if we don’t tackle living standards, increase sick pay and improve working conditions,” she said.

“People have had enough of clapping — they want action. If the government really wants to improve local economies, it should do something about ending low pay.”

She called for the introduction of a permanent short-time working scheme to replace furlough when it ends at the end of the month, as fears of an increase in unemployment in sectors such as the arts, food and hospitality continue.

Such a scheme would typically allow firms experiencing financial hardship to temporarily reduce working hours while providing staff with income support from the government.

Ms O’Grady also reiterated demands for an increase to the £96.35 per week statutory sick pay, from which more than two million low-paid workers — mostly women — are excluded because they do not earn enough to qualify.

And she warned that the cancellation of the temporary £20-per-week uplift to universal credit next month will be a “hammer blow” for low-paid workers, pushing many further into hardship.

Earlier this week, Ms O’Grady blasted the PM’s proposal to increase National Insurance contributions in order to overhaul social care, saying that a wealth tax on capital gains assets would be a fairer and more sustainable alternative to increasing taxes on working people.

“This Covid class divide has seen low-paid workers bear the brunt of the pandemic, while the better off have enjoyed greater financial security, often getting richer,” she said. 

“This should be a wake-up call — we need an economic reset. It’s time for a new age of dignity and security at work.

“Without fundamental change, the government’s own levelling-up agenda will be doomed to failure, and we risk repeating the same old mistakes of the past decade, allowing insecure work to spiral even further.”

Her calls come as fresh concerns over the future of young people are raised, with more than a quarter of 16- to 25-year-olds telling a survey that the pandemic has ruined their career dreams.

A Co-op poll of more than 5,000 under-25s found that almost two-thirds of young people felt that their generation will be permanently disadvantaged at school and in work by the impact of the crisis.

Almost three in five thought that the government had failed them in its handling of Covid-19.

Warning of a “ghosted generation,” the Co-op urged Mr Johnson to appoint a youth minister to ensure that young people are actively considered in government decision-making.

The group’s chief executive Steve Murrells said: “Young people are the DNA of the future of this country, and we simply cannot have a situation where [they] feel like they cannot change their path or improve their life chances.”

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