Skip to main content

Economy The Paradise Papers prove our economic model is broken

But, says GAIL CARTMAIL, hope should not be lost. We can make changes, we can deliver Labour’s economic vision

THE latest revelations in the Paradise Papers about the tax avoidance strategies being employed by some of the richest confirms what Unite has been saying for almost a decade since the 2008 financial crisis: the economic system isn’t working.

How is it that hard-working women and men who are striving to pay their mortgages and feed their families are paying every single penny in tax that they owe but the global elite are able to play the system and protect their pots of gold from the tax authorities?

Their greed in evading tax is denying the Treasury the resources to pay for much needed new schools, a massive cash injection for the NHS and public investment in house building and infrastructure projects.

Unite supports the shadow chancellor’s call for a public inquiry to look into tax avoidance and evasion both onshore and offshore in response to the Paradise Papers, which have further undermined our trust in the Establishment.

The Labour Party 2017 election manifesto rightfully states that the party is committed to “rewriting the rules of a rigged system, so that the economy really works for the many and not only the few.”

Did you know that six million people in work earn below the living wage, the richest 10 per cent now own 900 times the wealth of the poorest 10 per cent and the gender pay gap continues to be 18.1 per cent but 37.4 per cent in financial services where women are the majority of the workforce?

When the world’s banks brought our economy to its knees 10 years ago, only a fool could conclude that the system should carry on unreformed.

But despite numerous political and industry inquiries, investigations and much reassurance to never allow the mistakes to be repeated we witness “business as usual.”

Big business was propped up and individual greed at the top of many corporations was allowed to continue unchecked and unchallenged.

Ten years on we see that RBS, which took a government bailout of more than £58 billion, continues to cut thousands of jobs year on year in the name of “efficiency,” that staff in Capita are fighting tooth and nail to protect their retirement incomes and that employees across the economy are battling to address the inequalities brought by the performance-related pay systems.

The gap between the top and bottom of the financial services sector couldn’t be wider. At the bottom staff have seen hundreds and thousands of their colleagues lose their livelihoods, they have seen their workloads multiply and their mental health suffer through job insecurity and stress.

Staff are being forced to work longer, work harder and earn less. The same pattern is being repeated across public services where seven years of pay cuts has demoralised the workforce and driven many to foodbanks.

Within the current economic system many working people across the economy are today earning less, after inflation, than they did 10 years ago. The majority are seeing their incomes fall while their debts rise.

During the summer, Unite members as diverse as those employed by Serco as hospital porters, cleaners and security personnel and by the Bank of England took strike action on pay and we were joined on the picket lines by shadow chancellor John McDonnell.

Yet the financial services industry is allowed to continue to operate in the interests of the corporate elite. The economic system simply works to sustain the status quo to the detriment of small businesses and local economies.

But hope should not be lost, we can make changes, we can upgrade our economy, we can deliver Labour’s vision of an “economy that works for the many, and not just the few.”

Labour has shown that the British government could make a difference today if it wanted to. Straightforward changes that could be implemented immediately could transform the economy to ensure we realise the wasted potential which is holding our country back.

The proposals around a financial transaction tax, a new unit to detect tax avoidance in HMRC and simply requiring the top 5 per cent of earners to contribute more in tax to help fund our public services.

And when will government commit to spending the £350 million extra every week on the NHS as was emblazoned on the Brexit battle bus?

We can be a stronger and fairer nation if we acknowledge that the current system simply bloats the corporate and individual greed of those at the top because the prospect of change appears too remote.

Yet allowing the inequality to swell will merely allow the already rich to concentrate their riches.

The broken economic model that encourages false self-employment rife in the construction industry, that celebrates “competition” in essential services such as energy, is not a natural order divined by a celestial body.

This broken economic model represents political choices over decades that serve those who grab profits over those who create wealth and provide public services.

Unite is pledged to keep fighting for a system that is fairer and functions for the many not the just for the few.

Ultimately this means we must organise in every workplace, mobilise around the issues that matter to members and take action to take back what is owed and deserved.

Gail Cartmail is Unite assistant general secretary.


We're a reader-owned co-operative, which means you can become part of the paper too by buying shares in the People’s Press Printing Society.

Become a supporter

Fighting fund

You've Raised:£ 13,711
We need:£ 4,289
7 Days remaining
Donate today