1. Making the case for a fair recovery Nicola Smith Head of Economic and Social Affairs, TUC

2. Introduction Current state of the economy Implications for services and spending Is there any other choice? What do the public think? Arguing for an alternative

3. State of the economy

4. The economy is finally growing Quarterly GDP growth rates, ONS

5. Although it remains the slowest recovery on record The profile of recession and recovery, NIESR

6. There are also concerns about how sustainable the recovery is George Osborne, 25 th Feb 2010: “The recovery will only be sustainable if it is accompanied by an internal and external rebalancing of our economy: in other words a higher savings rate, more business investment, and rising net exports”

7. With little evidence of ‘rebalancing’ GDP by expenditure, TUC Economic Quarterly

8. While household spending is increasing, real earnings are not Contributions to annual growth in real earnings, TUC

9. Jobs improvements are welcome ILO unemployment, TUC

10. But under-employment remains high, although levels are starting to fall Involuntary temporary and part-time work, TUC

11. The jobs market has changed since 2008 with more part-time work Part-time and full-time work, TUC

12. There has also been some change in jobs levels in different sectors Change in workforce jobs, Sept 2008 – Sept 2013 TUC

13. Some groups are now at particular risk of poorer outcomes Employment rates for different groups, Inclusion

14. What does this mean for services and spending?

15. Growing economy means that public finances are improving Public finances, ONS

16. But most of the spending cuts in services and benefits are still to come Green Budget 2014, IFS

17. And public sector employment is set to fall further General Government Employment forecasts, OBR

18. Is there any other choice?

19. What choices does government have? Far more than they suggest! We need to consolidate the public finances, but many unknowns: – How much capacity has been lost? – How sustainable is the recovery? And governments have choices: – Speed of consolidation – Balance between tax and spending – Discretion over tax cuts

20. There are also wider policy choices that could deliver a fairer recovery Employment protection legislation – Unfair dismissal protection – Rights for casual workers Strengthening the minimum wage and tackling high pay Fairness in social security – We don’t need the current sanctions regime Tax evasion and avoidance – How strong is the anti-avoidance strategy? Corporate governance and company decision making – Are firms being made to invest for the long-term?

21. So what do the public think of the current approach?

22. A consistent majority think the cuts have been unfair You Gov tracker polls, TUC analysis

23. Although a majority also think they are necessary You Gov tracker polls, TUC analysis

24. The proportion who think the cuts are too deep has been falling You Gov tracker polls, TUC analysis

25. As has the proportion who think the cuts are being implemented too fast You Gov tracker polls, TUC analysis

26. Public do not back plans for a permanently smaller state TUC You Gov poll

27. And do not think gains of growth will be fairly shared TUC You Gov poll

28. Public support social security safety net GQR polling for the TUC

29. Particularly for people in work TUC You Gov poll

30. Lots of misinformation about benefits TUC You Gov poll, responses on proportion of benefits bill people think spent on JSA

31. Few people think they have gained from the economic recovery MORI poll on extent to which people think growth has benefitted their living standards

32. So what should progressives be arguing for?

33. What might a fairer recovery look like? Gains of growth that are more fairly shared – Better jobs (better balanced recovery and rights at work) – Fairer pay (at the bottom and at the top) Super-rich paying their fair share – Fair tax – Banks and big business held to account Vital welfare safety net retained – Protection for those who have contributed – A system that is fair Against permanent public service cuts – Childcare, social care, hospitals, schools vital to help households and boost the economy

34. Over to you!

35. Thank you! nsmith@tuc.org.uk