Burial charges illustrate impact of council cuts

Burial charges again illustrate how council charges are being used to plug the Council Tax freeze and cuts in local government funding.

A Citizens Advice Scotland (CAS) report published today said the number of people asking for help with funeral costs had risen by 35% from 2014. This updates a previous UNISON Scotland report on charges that highlighted burial costs.

The report said that the basic cost of funerals had risen in all but two local authorities, and on average has increased by 10% from 2014. On average, a burial in Scotland now costs £1,273.

Council funeral charges have been rising by an average of 7% since 2004.

They also highlight 'Huge disparities' between councils. Moray and South Lanarkshire have not seen any rise in their prices at all, while Aberdeenshire has increased the cost of a burial by 42% since 2014. That translates to a £420 rise on the cost to families planning a funeral.

The 'postcode lottery' argument is less convincing as it can be down to a variety of local factors. Some cost driven and others due to legitimate political choices. One person's postcode lottery is another's local democracy. We should also remember that burial is only one factor in rising funeral costs.

However, the main point is valid. Burial costs are simply another example of increasing charges to plug council finances. Charges are almost always regressive, with little reference to ability to pay.

 

 

Inflation busting registration fees for health workers

At a time of pay restraint it is not acceptable for regulators to impose inflation busting fee increases on health and care workers.

I was giving evidence today at the Scottish Parliament Health Committee on secondary legislation that increases registration fees for a range of health and care professions UNISON represents. The Health and Care Professions Council (HCPC) increased fees by 5% last year and indicated that they would not increase them again for two years. However, they have now come back for a further 12.5% increase after a perfunctory consultation while Westminster was in election purdah.

They claim this is because of a levy from the regulatory overview body, the PCA. However, only 30% of the increase relates to that with the balance reflecting new accommodation and IT systems. This looks opportunistic, particularly when there has no detailed costing was provided. The HCPC also generated a big operating surplus last year and is substantially increasing its reserves.

Needless to say health and care workers are not getting a 12.5% pay rise! The HCPC argue that they are the lowest cost regulator, but comparing paramedics, OTs and ODPs to doctors and dentists was, to put it mildly, insensitive. A UNISON survey of registrants indicates that many staff do not think they get value for money and that the HCPC could do more to reduce unnecessary hearing costs.

Scottish Labour MSP, Richard Simpson moved a motion of annulment, a very rare procedure in the Scottish Parliament. He made a very strong case pointing to the absence of an Equality Impact Assessment on what is a predominately female workforce. He also drew attention to the huge increase in the Chief Executive's pay, up by £26,000, more than the annual pay of many registrants. Also that the fee for Scottish social workers, regulated in Scotland, is only a third of the cost of their English counterparts who are regulated by the HCPC.

Predictably, SNP MSPs voted against the annulment as this increase is supported by the Scottish Government. We will look forward to the minister supporting a 12.5% pay rise next year!

In fairness MSPs did so with no great enthusiasm, they welcomed the fact that this debate took place and that the regulator was put under scrutiny for probably the first time. There is a case for wider reform of UK regulatory bodies and they might find it more difficult if they return for another increase next year.

Putting the increase under the spotlight was probably the best we could have achieved this year. Health and care workers have no choice but to pay these increases, so they look to their MSPs and MPs to scrutinise these costs vigorously.

Time for a political consensus on local taxation

The funding of local government in Scotland has been a difficult issue for political parties. At best proposals have been sticking plaster solutions because change is viewed as being politically challenging. However, we simply cannot go on as we are with short-term fixes that damage services and undermine local democratic accountability.

Today, I was giving evidence to the Commission on Local Tax Reform, a welcome cross party initiative co-chaired by the local government minister and the President of CoSLA.

In our submission we cover the piecemeal attempts at reform and highlight the damage that quick fixes like the Council Tax freeze are doing to local services. Increasing charges is a regressive substitute for progressive taxation.

A core element of our case for reform is that property is a significant form of wealth and must be taxed in order to reduce inequality. The well-off already own bigger and more houses than the rest of us. If this form of wealth is untaxed it becomes an even more attractive form of investment. This means that more people buy houses, not as a place to live but as an investment. This will add to our already dire housing shortages, increasing prices for both renters and ordinary buyers.

We set out five principles for reform:

• Local authorities should raise and control more of their own revenue. This will enable them to respond to and be more accountable to the communities they represent. About 85% of funding is currently determined centrally

• Councils should be able to set their own business rates, this will allow them to raise money to pay for services and devise their own criteria to support the type of businesses they want to encourage.

• A property tax is the best fit for local government as it is clearly linked to the authority. It cannot be moved or hidden making it cheap and easy for the local authority to administer.

• Central government funding should acknowledge local decision making and funds should be minimally ring-fenced.

Taxation should be broadly progressive, reducing the tax incidence of people with a lower ability-to-pay. It doesn't mean every tax has to be progressive, but overall, those on higher incomes should pay more.

Our submission also evaluates the options for reform.

We oppose a Local Income Tax primarily because it would be another tax on workers income and ignores the wealth that resides in property. It would have to be administered and set centrally, undermining local democracy. There are also a range of practical problems in collecting and allocating a national tax to local authority areas. It could add as much as 6p to income tax.

Land Value Tax is a superficially attractive option, not least because it is a property tax and might be progressive in taxing the rich. However, this idea has been around for 150 years and their are good practical reasons why it really hasn't taken off. The biggest problem is valuing land while ignoring what is built on it. Most of us have a vague idea what our house is worth, but not a clue of the land value. In order to send out bills and ensure they are paid you also need to know exactly who owns all the land, where the borders are and where to send the bill to. The Scottish Government is working on a register of landowners but has a timescale of ten years to complete this work. We cannot wait at least another ten years for a new tax. If LVT is part of the solution it is as a central tax that could address issues like land banking, or possibly as a replacement for business rates, but not the Council Tax.

That leaves our preferred option of a Local Property Tax levied on a percentage of actual property values. The Burt Review found that using actual property values rather than banding was more progressive because it would get rid of the ‘cliff edge' where those on either side of a band with a small difference in property values have very different bills. On the other hand banding could reduce appeals. In 2007 he recommended it be set at 1% for same yield as the Council Tax and while this would have created one-third losers, half would be gainers. Any future bills must based on up to date property valuations and regular revaluations to prevent the current situation building up again.

The new tax would need to have effective mechanisms to protect those on low incomes. Exempting properties below a certain value is one possible way to do this as is the introduction of an appropriate benefit to ensure local authorities received funding, but still protects those on lower wages/benefits. Pensioners with high value properties and low incomes should also be allowed to defer payments, leaving a bill to be paid which would come out of their estate.

Local taxation is one of the most difficult problems for the Scottish Parliament to resolve. No one party wants to be responsible for a new tax. No one wants to pay higher bills, particularly when real wages are not increasing and other costs are rising. Those who get higher bills will campaign loudly against them, winners will quietly carry on.

Difficult though it is, we cannot continue like this. The Burt Report was essentially a technical report and of its time. This Commission needs to be much more political, making the case for taxation and local democracy. That's why we welcome this Commission and hope it leads to a political consensus that we can all move ahead with.

 

Giving social care the priority it deserves

The social care crisis in Scotland is not given the priority it deserves, but there is a growing consensus about what needs to be done.

 

I was speaking at the Care Scotland, care at home conference on Friday. The panel was asked to set out what’s wrong with home care and how we would fix it.

 

On a national and local level we need to fix the crazy commissioning system that isn’t working for anyone. It isn’t working for providers who are struggling to maintain a viable business model. It isn’t working for staff; either social workers that are trying to put packages of care together, or home care staff that are the real victims of the race to the bottom in pay and conditions. Most importantly, it isn’t working for service users, who suffer from the high turnover of staff with little continuity of care, or are stuck in a hospital bed because there are no staff to care for them at home.

 

The solution primarily needs proper funding. It’s easy to blame politicians for obsessing about the NHS, but they are often just following public opinion that rarely understands that social and NHS care are interlinked. Personally, I am coming to the view that we need an agreed national rate for home care, as we have for residential care. This would be a rate that is dependent on providers paying the Scottish Living Wage and maintaining a range of other workforce standards. One of the merits of a national rate as against a local top up is that it wouldn’t just reward the bad employers in the sector.

 

That leads me to the second issue, employment standards. Any funding agreement has to include the key elements of UNISON’s Ethical Care Charter. The new procurement guidance rightly recognises that paying the Scottish Living Wage alone is not enough because some providers will simply cut other conditions. There needs to be action on zero and nominal hour contracts, sick pay and travel time. In addition, what comes through strongly in all our surveys is the importance of giving staff time to care and proper training linked to career progression. A recent UNISON survey highlights frighteningly low levels of training. Caring should be a great job and many staff I meet recognise that. But the household bills have to be paid and so many end up stacking shelves in supermarkets instead.

 

I am pleased to say that there was a broad consensus amongst the panel at yesterday’s conference on what needs to be done. Scottish Care also launched their latest research report on this issue, which is well worth a read.

 

The media headline was all about freezing heath spending, but the key finding is that investment in better social care for older people would improve their lives and help to cut emergency hospital admissions. In 2012-13, the average emergency hospital admission for over-65s lasted for 11.8 days, at an average cost of £4,846. That amount could fund either care at home for a week for 27.7 older people or 9.28 weeks in a residential care home for one pensioner.

 

Ranald Mair, chief executive of Scottish Care, said: "If we're going to manage to keep more people out of hospital, to maintain them in their own homes and also to prevent them going into long term care at an early stage, then we actually have to invest in home care. The danger at the moment is that we're continuing to invest in hospitals and as you know, all politicians want to be the defenders of the NHS. This isn't an attack on the NHS, let me be clear. If people need to go to hospital that's where they should be. But what we know is that over 20% of admissions of older people to hospital are 'unnecessary' admissions. They're not going in because of their clinical needs, they're going in because of their circumstances and because of the lack of alternatives."

 

It’s hard to disagree with that. Investment in social care and in particular the staff who deliver care, needs to be one of our highest priorities.

 

Fire and Rescue Service faces further cuts

Audit Scotland has published a report on the creation of a single fire and rescue service for Scotland. They conclude that the process was managed effectively, and its performance is improving.  However, a long-term financial strategy is now urgently needed to address a significant potential funding gap.

The key financial concerns are:

“Reported savings of £16.1 million in 2013/14 and planned savings of £6.6 million in 2014/15 puts the Scottish Fire and Rescue Service on track to exceed expected savings of £328 million by 2027/28. However, as a result of future cost pressures and likely reductions in funding, we estimate a potential funding gap of £42.7 million in 2019/20. The Scottish Fire and Rescue Service does not yet have a long-term (five to ten year) financial strategy. It is developing the necessary underpinning strategies.”

 

 

Staff costs amount to 79% (£207 million) of budgeted gross expenditure. The support staff represented by UNISON Scotland makes up only 9%.

On future savings, Audit Scotland calculates gross savings of £55.3 million by 31 March 2020. However these will be offset by cost increases (inflation, increase in employers' national insurance costs etc) of £32.4 million, resulting in net savings of £22.9 million. The SFRS cost plan assumes that budgets will remain at the same level as 2015/16 until 2019/20, while recognising that a decrease in funding of 5% by 2019/20 would result in a funding gap exceeding £21 million.

Audit Scotland believes that this is an optimistic assumption. Our analysis uses forecasts of UK public sector spending from the OBR to estimate future funding. They calculate a potential funding gap of £42.7 million (in cash terms) in 2019/20. A potential funding gap of £42.7 million in 2019/20 assumes that budget reductions are spread evenly across the public sector, with no protected areas. If some areas are protected, the SFRS's funding gap could exceed £42.7 million.

 

In this context they recommend a long-term financial strategy is needed for the SFRS, to show how it will close the funding gap and achieve savings by 2019/20 and beyond.

The funding shortfall is exacerbated by the SFRS’s liability for VAT. UNISON Scotland warned the Scottish Government of this risk and they were explicitly warned by the Treasury that if they chose to organise Fire and Rescue services in this way they would lose the previous VAT exemption. Sadly, Scottish Ministers ignored this warning and scarce resources are now going to the Treasury.

 

What's coming our way with a new Tory government

As the Tories form a government at Westminster what are the issues likely to face Scotland and trade unions in particular? There are many, but the key issues are likely to be public spending, welfare, employment rights and the constitution

The key issue for any devolved administration is funding. We know from the budget that the Chancellor’s plans involve slashing £30bn from UK public spending with the deepest cuts in 2016/17 and 2017/18, as this chart shows.

What does this mean for spending in Scotland? As always it's difficult to be precise because we don't know exactly where the cuts will be made in England and therefore the Barnett consequentials. The Budget stated that £13bn will come from departmental budgets, £12bn from welfare cuts and the £5bn balance from tax avoidance savings.

It's the department budgets that have the direct Barnett consequentials and that might be mitigated a bit if they deliver on the promised cash input into the English NHS. We still don't know where the welfare cuts are coming from and I suspect the tax avoidance savings are very unlikely to be delivered. Particularly as they are cutting HMRC staff! There is therefore a real risk that departmental budgets will have to take a greater share of the cuts with negative Barnett consequentials.

Cuts at this level will require more than the salami slicing approach of recent years. Will the Scottish Government continue to dump most of austerity on local government and if so where does that leave policies like the Council Tax freeze. While I have no doubt the Scottish Government will do what it can to mitigate, we all need to start thinking outside the box for some creative solutions. The Smith Commission borrowing powers, while not all we would want, may be one opportunity to look at issues like refinancing expensive debt and PPP schemes.

Closely linked to spending is pay policy. Pay restraint is likely to continue and next April there will be National Insurance contribution increases that will take a further 1.4% out of the pay packets of workers in contracted out pension schemes. That's most of the public sector. It will also hit public sector budgets as employer contributions will rise by a massive 3.4%. None of this will do much for spending power in the economy - continuing the low wage, low productivity problem that underpins much of our economic woes.

While the Tories refused to spell out where they would cut benefits to achieve their spending cuts, it is clear that they will largely come from the working poor. This will be a further attack on incomes, particularly for low paid workers with families. Some 250,000 in-work families who currently receive Child Tax Credits (CTC) and Working Tax Credits (WTC) face a potential threat of £40 per week on average being cut from their weekly incomes.

There will be a further attack on employment rights that are already some of the weakest in Europe. Industrial action thresholds are designed to undermine the right to strike and employers will be allowed to bring agency staff to scab. I fear there will unforeseen consequences of this with many more small scale disputes where the threshold is usually met, coupled with new forms of unregulated protest. Talk of deregulation from the new Business Secretary is code for further attacks on workers rights and undermining basic protections such as health and safety. On a more positive note there will be an opportunity to address the pernicious impact of Employment Tribunal fees when this is devolved under the Smith Commission proposals.

This is another reason why the Human Rights Act is under attack. The Tories don't want their legislation to be challenged. There is an interesting and developing debate on how this sits with the Scotland Act requirements and what we might be able to do to resist this. It's complex and probably the subject of a separate post, but that Tory champion of human rights, Winston Churchill, will be turning in his grave.

While there is a commitment to implement the Smith Commission proposals, that won't be the end of the constitutional story. As a Scottish Parliament committee highlighted this week, the legislative proposals fall somewhat short of the recommendations and others need more clarity. There will be additional pressure to improve on Smith as reflected in the STUC Memorandum of Understanding with the Scottish Government this week.

There will be a temptation for the UK government to call the Scottish Government's bluff on Full Fiscal Responsibility, although I suspect Treasury orthodoxy will triumph over political opportunity. We must hope so, not just because of the negative public spending consequences, but because creating a UK version of the Eurozone's fiscal and monetary policy mismatch won't help the economy.

The above demonstrates that the next few years will be pretty grim for everyone in Scotland and the rest of the UK, with the obvious exception of the rich, who will be pampered as usual. Devolution brings some opportunities to mitigate the damage in Scotland and so we all need to work together constructively to exploit that potential.

 

Work and Poverty

"Children are not private luxuries: they are a joy in themselves and a social good." CPAG

UNISON has launched a Childcare Charter calling for the provision of high quality childcare in this we also point out that Getting it Right For Every Child cannot be separated from improving how work fits into family life. As in work poverty continues to grow we need to look at the balance between hours worked, rates of pay and the need to undertake caring responsibilities in order
Almost two thirds of children living in poverty have at least one working parent we need to look at how make sure that work does indeed guarantee freedom from poverty. Child Poverty Action Group (CPAG)have published a new paper Round the Clock: in work poverty and the hours question. They pose the question “How many hours should parent work (in order not to be poor)? The research is not just about how much you can earn but how you balance working hours with looking after children. The research involves an evidence review on attitudes to parental employment, a poll asking how many hours it was reasonable for parents to work and when those hours should be, taking the polling results to focus groups and also asking more about working hours expectations for lower paid parents and finally taking the results to employers to hear their views. The report also considers the policy implications of the findings.

Choices about how and when to work are made in an economic and social context. Most people think that once you have children you will have to reduce spending in some areas because you have higher costs in others. An EHRC study on working preferences in 2009 found that 57% of high income households had a stay at home parent in contrast to only 25% of those on low incomes. As the recession has progresses average earnings have decreased and so those on low pay to work longer hours to make ends meet.

One and a half to two earner households have a very low risk of poverty, part-time work does not protect couple families or lone parents from poverty.

Children in lone parent families still have a substantial risk of poverty even if their parent works full time. Almost one third of children whose parents are self employed (a growing sector of the workforce) live in poverty

Changes to the benefits and tax system (including universal credit) incentivise those on low incomes to increase working hours while endorsing the traditional breadwinner role for the better off.

Poverty reduction strategies seem to be focused in encouraging all parents to work full time. The planned and recent expansion of childcare provision is increasingly linked to parental employment rather than child development. At the same time governments are also promoting programmes encouraging positive parenting and parents spending “quality time” with children. Running across the debate is an increasing confusion between the constraints that low incomes place on peoples’ parenting choices and actual neglect/harmful activities by parents.

Only 25% of parents were content with the balance between their home and working lives, 77% reported that work cut into the time they had available to helping children with homework, taking them to clubs and putting them to bed.
When asked how they would like to strike a better balance 27% would work less hours, more than a quarter saying they would take a pay cut to do so. 22% would give up work altogether, 22% would like to work from home some of the time and 21% would like flexible hours.

The survey went on to ask what working hours were thought to be reasonable for parents per week. Interestingly there was no clear gender social class or political persuasion link to responses. For many the one full time one part time working parent is now deemed the norm. participants thought it was reasonable for a lone parent to work more hours than “the carer” parent in a two parent household. Respondents also felt it was more reasonable for lone parents to work longer hours and by the time children were 3 very few felt it was reasonable for lone parents not be in work. They did though not expect both parents in a two parent family to be in full time work at this stage.

In focus groups it was clear that most think the balance of work/childcare is deeply personal, it was also felt that debates about working parents don’t focus enough on the needs of the child which it was widely believed should be put back in the picture. Parents frequently asked why parenting was not valued despite its “societal importance and manifold rewards” As UNISON’s charter states “While childcare should enable parents to work its focus must be on what’s best for children and their development”.

Key points from the CPAG report

Affordable quality childcare is essential, this means not just nurseries but also around school hours and summer break for older children.

Children also need relaxed quality time with parents: expanded childcare is not a substitute for this.

Vital role for tax credits in supporting those working less than full time but those in full-time work should have a living wage and not require benefits to live.

Flexible working can be a double edged sword: flexibility can be good but zero hours and short notice demands for extra or just insecure weekly hours difficult when childcare has to be booked and paid for regularly and in advance. It doesn’t mean the same thing for those at the top and bottom of the wage scale. Parents need predictable hours.

Wage progression is an essential part of a poverty reduction strategy so we need more childcare support for those undertaking training.

Working more hours helps people earn more money but cannot forget the importance of decent pay rates
Value of benefits must be restored to pre 2010 levels.

In work poverty is produced by three things: levels of pay, hours worked and level of in work benefits. Need to tackle all three and ensure that parents have the time levels of income to allow them to spend time with their own children.

UNISON’s Childcare Charter is available here