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International insights

Introduction from the deputy general secretary

Welcome to the online version of PCS’ first ever international newsletter, which is also available in hard copy and as a pdf.  It has been made possible with an International Development Learning Fund grant from the Department for International Development, administered by the TUC.

Just like climate change, economic crises don’t respect national boundaries. Stocks, shares and money change hands at the click of a mouse, workers migrate across continents due to the promise of work in one place and the lack of it in another, and financial recklessness in the US and UK banking sectors precipitates pay freezes and caps or cuts on public sector expenditure from London to Lagos, and Manchester to Moscow.

It is therefore increasingly difficult to define members’ interests and the union’s involvement in activities purely in terms of national boundaries, whether it’s due to EU Directives or the applicability of the International Labour Organisation’s core labour standards. Or even the plight of trade unionists in sister unions in Colombia, Iraq or Palestine, because it’s not such a long time ago that trade union activity in the UK could mean surveillance, intimidation or jail. We owe them our solidarity and support.

I’m delighted that PCS is seeking to continue and develop its international work, and I hope you will find these webpages informative and stimulating. If you have any comments about the contents, or would like to be put on a mailing list to receive future information about PCS’ international work, then please contact Gary Willis, the International Project Officer, at: gary@pcs.org.uk

Taxation - a public service solution to a global problem

By Simon McRae, Senior Campaigns Officer, War on Want

War and Want and PCS recently agreed to focus on tax havens as part of their joint campaign ‘Global Problems – Public Solutions’. The campaign is focused on the importance of the public sector in tackling poverty and providing vital public services such as healthcare, housing and education. Tax not only provides funding for public services it also enables democratically elected governments to determine how wealth is distributed, rather than profit-driven corporations.

It’s estimated the UK could be losing £100 billion in tax revenue, enough to fund the NHS, while developing countries lose an estimated £250 billion from all forms of tax dodging, including transfer mispricing. This staggering amount of money would enable governments to achieve the UN Millennium Development Goals which include lifting over a billion people out of poverty many times over.

Rather than tackle tax dodgers the government is slashing jobs at the HM Revenue & Customs and closing 200 tax offices, even though each tax compliance officer generates an average £640,000 a year in tax revenue. But the global financial crisis has now seen the spotlight put on tax havens, which have been implicated in a number of high profile tax dodging scandals involving major banks and the super rich.

The pressure is now on governments to crack down on the shadowy world of tax havens which have siphoned billions from governments as well as allowing banks to undertake highly risky activities with little supervision or oversight. PCS and War on Want have launched an action postcard for use by PCS members – ‘tax justice not tax havens’.

Members are asked to send the card to their MP, urging them to write to the Prime Minister asking him to take action to stop tax office closures and take measures to outlaw tax havens and tax dodging. Supplies of the postcard have been sent to all regional offices, and an e-card version is available.

All you ever needed to know about transfer mispricing

Sixty per cent of global trade takes place between subsidiaries of the same multinational companies. Transfer mispricing is the false pricing of transactions between subsidiaries operating in different tax jurisdictions, therefore allowing profits to be moved offshore without paying tax or paying at a very low level. This, and the even more blatant falsifying of invoices, account for about 7 per cent of all global trade transactions each year. If taxed, this trade would raise US$ 160bn a year in revenue.

This draining of money is allowed to go unchallenged because of the lax regulatory climate surrounding global transfers of cash into jurisdictions (‘tax havens’) offering financial secrecy, and the ability of international businesses to exploit the limited capacity of domestic tax authorities. Tax administrations of many African countries lack sufficient staff to be able to devote time to tackle the complex transfer pricing strategies of multinationals. The result is that no African country has yet raised a successful challenge to multinational company transfer mispricing.

The ability of governments in the developing world to tackle high infant mortality rates and other human tragedies resulting from poverty is extremely limited without the economic resources to implement positive change. The fact that so many economies remain on their knees is due in no small part to a lack of tax revenue.

In healthcare alone, at current spending patterns in poor countries, the revenue would save the lives of an estimated 350,000 children under the age of five each year, 250,000 of them babies. Of course it is unrealistic to assume that if change occurs and this tax is paid, the revenue will be devoted entirely to saving children’s lives. However the approximate effect of changes in tax revenue on mortality can be estimated, using data from developing countries on existing tax revenues, public expenditure and mortality rates. This establishes the relationship between taxes and death.

For more, see the ‘Death and taxes: the true toll of tax dodging’ report by Christian Aid.

The life or death difference social protection can make in developing countries

PCS members generally , but particularly those working in Department for Work and Pensions, will be well aware that social protection measures such as child benefit, pensions, disability benefit and social assistance to the poorest are crucial in helping significant proportions of the UK population to avoid poverty. In developing countries however, where they exist they can literally mean the difference between life and death.

Children and older people are among those who suffer most and are least able to escape chronic poverty. They often live in households consisting of several generations, with little or no regular income, and in many cases the middle generations may be missing due to HIV and AIDS, and migration. The International Labour Organisation’s campaign for a ‘Global Social Floor’ includes a comprehensive package of social pensions and child grants.

Whilst the Millennium Development Goals (‘MDGs’ – designed by the United Nations as a way of focusing attention and action on key global development issues) have specific targets on children and youth, they are silent in respect of the oldest segment of the world’s population. Yet by 2050 the proportion of older people is projected to grow from 10% to 22%, and the proportion of the world’s older people presently living in developing countries will increase from 64% to 80%.

Despite its lack of visibility in the list of MDGs, over the last few years development agencies and governments, particularly in Africa, have concluded that securing the rights of the most vulnerable people to social protection is key to tackling extreme poverty and hunger. Pensions and child benefits in particular not only effectively reduce poverty but also support the kind of economic growth which is most beneficial to the poor.

Several governments have already introduced social pensions, which is an important step towards a comprehensive social protection package. Pensions have a considerable impact on older people, their dependants and the households in which they live, thus directly addressing poverty across the different family generations.

UN figures show that in the least developed countries, as many as 71 per cent of older men and 37 per cent of older women are working. Many of them are in hazardous and unregulated work. A regular and predictable social pension enables older people to cover their basic needs; this may well not be enough to stop older people from working, but it will enable them to choose less strenuous, discriminatory or debilitating work.

Such social cash transfers, alongside other policies, can also increase the number of people who have access to safe drinking water and basic sanitation where these utilities have to be paid for. They can also contribute to the achievement of the MDGs. Pensions are often spent on education, particularly for girls; they can also increase household members’ access to healthcare services, and can alleviate the impact of HIV and AIDS by providing financial resources for the care of very vulnerable children and orphans.

Pensions and child benefits, even at relatively modest levels, provide vital support to particularly vulnerable groups – particularly in Africa and other parts of the developing world.

For more see the ‘An untapped resource’ report at HelpAgeInternational

Trade union rights and human rights - two sides of the same coin

By Shane Enright - trade union campaigns manager at Amnesty International UK.

With the TUC and Amnesty International UK having signed a Memorandum of Understanding in February 2009 on working together more closely, now’s a good time to reflect on whether the rights the movement has fought long and hard for are core human rights, or just a “bolt-on”.

Article 23 of the Universal Declaration of Human Rights asserts confidently that everyone has the right to work, to free choice of employment, to just and favourable conditions of work, protection against unemployment, equal pay for equal work, and reasonable payment ensuring for themselves and their family a dignified existence - supplemented, if necessary, by other means of social protection – and, of course, the right to form and join a trade union.

You won’t need me to tell you that traditionally the right to work, dignity and social protection have been advanced universally by the trade union movement, rather than the rights-based “prisoner of conscience”approach of Amnesty in the first phase of its existence. However, with Amnesty now embracing broader economic, social and cultural rights, its activists are learning to campaign on rights to union representation, freedom from slavery and child labour, and protection from discrimination.

So the right to work is no longer solely the domain of labour movement activists. As Brendan Barber, TUC General Secretary, puts it: ‘Unless governments, NGOs and unions place a strong focus on work, all we are doing is providing endless charity.’

As we once again face the challenge of a global recession and worry about our own economic security, it seems to me that there is a growing convergence between Amnesty’s broad right-based advocacy and the social and economic activism of our trade union partners.

Can we expect fair play at the London Olympics?

By Didem Ozdemir, TUC Research Fellow

The licensing and merchandise for the Olympic Games is an industry worth hundreds of millions of pounds. The companies awarded Olympics licenses have great opportunities to make considerable profit and enhance their brand image since the licenses give them exclusive rights to produce and sell Olympic goods.

However, several studies of past Olympics have revealed that in the past workers who have worked hard to produce goods for the Olympics are not getting their fair share from the vast profits generated by the Olympics.

From China to Indonesia to Turkey and Bulgaria, sportswear and other goods bearing the Olympic logo have been made by workers who, like most workers in global supply chains, do not have access to their fundamental rights.

Researchers belonging to the ‘Play Fair 2008’ campaign investigated working conditions in four Chinese factories producing bags, headgear and stationery bearing the Olympic logo - they found that the goods were being produced by children as young as 12 years old, adults earning 14p per hour (half the legal minimum wage), and employees being made to work up to 15 hours per day, seven days a week in unsafe and unhealthy conditions.

Yet the Olympics Charter guarantees fair play ‘to create a way of life based on the joy of effort, the educational value of good example and respect for universal fundamental ethical principle’. The PlayFair Alliance was formed in 2004 to campaign against this contradiction between the Olympics philosophy and the horrendous working conditions of sweatshop workers.

PlayFair 2012 is on the starting blocks getting ready to raise the bar on ethical trading for all goods bearing the Olympic logo - ensuring workers' rights are respected throughout Olympic supply chains. Coordinated by the TUC and Labour Behind the Label, it intends to ensure an Olympics that, in the words of former London Mayor Ken Livingstone, “values the people who will work to produce it.”

As trade unionists and as consumers of Olympics 2012 products, you have the power to make sure that people around the world producing the London Olympics goods feel at least some of the benefits. So the answer to the question in the title is: it’s up to us. Look out for Playfair2012 activity in the coming months!

What do carpets, chocolate and children have in common?

Answer…child labour.

The International Labour Organisation (ILO), the United Nations body responsible for developing and enforcing labour standards, estimates that some 165 million children between the ages of 5 and 14 are involved in child labour. Many of these children work long hours, often in dangerous conditions; an estimated 100 million are girls. The ILO’s standards require that countries establish a minimum age of employment – this is generally 15, although developing countries can set the age at 14.

However, in many countries of the world, girls and boys below the minimum age of employment can be found working in a wide range of occupations. Poor families may depend on the contribution that a working child makes to the household’s income, and place more importance on that than on education - but this is a child’s best chance of achieving ‘Decent Work’ when they are older.

PCS’ 2008 annual conference carried a motion on child labour, given that children continuing to be exploited in order to produce cheap goods for UK retailers. The motion called on the union’s National Executive Committee to be active on the issue, but PCS members also have a vital role to play in their ordinary everyday lives as shoppers.

For example, boys are trafficked between countries in West Africa and exploited as child labour on plantations producing goods for export such as cotton and cocoa; this is a particular problem in Cote D’Ivoire (Ivory Coast). The country is the world's largest exporter of cocoa so it’s quite possible that child labour has been used to make the chocolate you might buy – unless it has a ‘FairTrade’ mark, which guarantees that products have not been made using child labour.

Similarly, in India, Pakistan and Nepal, children may work 10 to 14 hours a day in cramped and hazardous conditions, weaving, knotting and cutting threads in carpet workshops. The UK imports millions of square metres of handmade rugs from these countries each year; many of these carpets will have been made using illegal child labour – unless the carpet has a ‘Rugmark’ label; this is proof that no illegal child labour has been used to make the carpet or rug.

In some situations, boycotting goods such as chocolate can make the situation worse and undermine economies, such as in the Côte d'Ivoire, which is dependent on one export crop. An alternative is to encourage companies to improve conditions of employment. This is being attempted through schemes such as the Ethical Trading Initiative (ETI).

ETI is an alliance of companies, trade unions and non-governmental organisations working to improve employment conditions in the supply chain which delivers goods to UK consumers. It has an ILO-compatible code of employment standards that includes no child labour. ETI members then work with their suppliers to ensure these standards are met.

Ethical trade however, while improving conditions of employment, is not a guarantee that the producer will get a fair price for their produce, unlike fair trade.

Check out the FairTrade and Rugmark logos, read more about the ETI and more about labour standards from the TUC.

Looking to have a louder voice - women trade unionists in Palestine

PCS has a history of international solidarity in support of the Palestinian people, and in 2008 PCS Deputy General Secretary Hugh Lanning led a Palestine Solidarity Campaign trade union delegation to Palestine.

The situation facing Palestinian women workers is particularly difficult. 70% of the population in the West Bank and Gaza live below the poverty line and over one-third of the workforce is unemployed. As is often the case elsewhere, women bear the burden of family responsibilities and also economic discrimination.

Internal conflict in Gaza has resulted in the Palestine General Federation of Trade Unions (PGFTU) being intimidated by Hamas and having its offices seized by them. But at the heart of the challenges faced by Palestinian trade unionists is the Israeli occupation.

The wall that the Israelis have built cuts through Palestinian villages and farms, separating olive groves from water supplies and shepherds from their sheep’s grazing land. Literally hundreds of road blocks across the West Bank make it impossible for Palestinian workers to get to work on time, if at all, prevent the transportation of goods, and even delay pregnant women on their way to maternity wards. The occupation has crippled the Palestinian economy.

In this climate of fear and intimidation, the PGFTU is building the capacity of its Women’s Department to make it more capable of supporting working women, through education, training, and membership recruitment. The Department was only created in 1996 and currently receives little outside support, so much needs to be done and much help is needed.

The PGFTU Women’s Project is recruiting staff and paying activists to run workshops and study circles and produce publications. Over the next three years, a total of 40 workshops and 10 seminars will train nearly a thousand women, covering gender issues and women’s rights, health and safety, social security, collective bargaining, organising, the Palestinian labour code, employment policies, and child labour.

What the participants learn they will then take out into the wider membership. The Project is costing £25,000 a year over a 4-year period – but if more money is raised, more can be done.

Sue Bond, Vice President and Chair of PCS National Women’s Forum, says: “It is particularly appropriate that PCS members should think about supporting this project. Whilst women constitute only 12% of total union membership in Palestine, they are concentrated in the public sector and services.”

Individual PCS members and branches can support the development of the project through making a donation to the current TUC Aid Appeal.

Branches are of course, free to spend any monies they themselves raise, however there are restrictions on using centrally provided funds for donations (see Branch Treasurers’ Guide).

To make a donation by credit or debit card, choose the Palestine Women’s Project out of the list of TUC Aid Appeal projects to make sure your donation is earmarked for Palestine; if you have not made a donation online to TUC Aid before, you will probably be prompted to register on the site with an email address.

Donate online at the TUC.

If you prefer to pay by cheque please make it out to ‘TUC Aid’ and send to “PGFTU Women’s Appeal”, TUC, EUIRD, Congress House, Great Russell Street, London, WC1B 3LS.