7 May 2013

Alternative Policy Statement on Union Finances

A POLITICAL AND FINANCIAL STRATEGY FOR THE UCU

The UCU is facing a crisis. Some say that this crisis is a financial crisis. In fact, it is a financial crisis that is being transformed into a political crisis as some in the leadership of the union seek to use the fall in membership as an opportunity to turn the union away from campaigning for members’ terms and conditions, and in defence of public education, towards a servicing model of trade unionism.

A servicing union does not centrally engage in political campaigns against Government policy, or even industrial campaigns against pay cuts and worsening conditions. It becomes little more than an individual insurance policy for its members.

These days, everyone in the union declares for ‘a campaigning union’. Behind the repetition of this slogan as a dutiful mantra, however, there is a sharp choice facing union members about the future of their organisation.

As an alternative to the dramatic changes to staffing and to union democracy that have been proposed, we the undersigned propose the following:

    • a careful reduction in costs that does not damage member-­facing services and support, does not damage democratic accountability, and does not impose swinging staff cuts or compulsory redundancies;
    • a recruitment drive that targets institutions with below average membership density, starting with the largest such institutions;
    • an real increase in subscriptions, graduated by salary, to an average of the cost of a cup of coffee per month (currently, UCU membership is one of the cheapest in the country or internationally);
    • an improved progressive element in subscription banding.

UCU’s membership history

UCU grew continuously since our formation six years ago while other unions generally lost members. Why were we different? Because we set out from the beginning to build a union modelled on campaigning, organising, and resisting all attacks both locally and nationally. We maintained a high profile through industrial action over pay, jobs, and pensions. Not a year went by without us taking industrial action, and being in dispute in either FE or HE with the employers. Most members recognised a campaigning union when they saw one, and this also encouraged non-­‐union colleagues and new starters to join us.

This culminated during 2011 in us taking three or more days of strike action either over USS pensions or over the TPS alongside other unions. The high point was November 30th when we were part of the 2 million who went on strike over public sector pensions. UCU recruited around 1,500 new members in the run up to N30. We then proceeded to lose members thereafter as a consequence both of the compromise with the Government by some unions that sank the possibility of a united continuation of a defence of pensions, and of the de facto acceptance by UCU of a two-­‐tier USS that divides members in the pre-­‐92s.

The lesson is clear. Underpinning any plan to address the union’s current financial issues must be a concerted reassertion of the union’s willingness to be seen, in all our institutions and on the national stage, as standing up for post-­‐16 education, and defending pay, pensions and conditions.

Is the UCU facing a financial crisis?

The UCU is facing pressing financial difficulties. The problem is a structural one. It is not the case that members are resigning from the union; rather UCU is losing older members who are retiring or being made redundant. This has been happening, particularly in FE, over the past 18 months. Additionally, it is not recruiting sufficient numbers of younger members or new entrants, who are often on fixed term or temporary, or otherwise precarious, contracts. This dramatically affects subscription income since the older members tend to be higher paid, and consequently paying subs at a higher rate than new recruits.

What is the solution offered by the General Secretary and senior national officials, by most of the elected national officers, and by the majority group on the National Executive Committee?

The solution of the Senior Management Team (the General Secretary and the senior national officials), the national officers (the President, Vice President, etc.), and the majority group on the NEC, is to put in place the following:

    • a possible 27% cut in the staffing budget (now through voluntary redundancies and natural wastage);
    • a reduction in the size and thus representativeness of the NEC;
    • a truncation of the time for debate at national Congress, and in branch entitlements;
    • cuts to the number of committees representing members; and
    • an exploration of means to generate more income through letting-­‐out part of the union HQ.

This is an unnecessarily pessimistic and managerialist response.They are looking for savings in the region of £2 million per annum to balance the books. Importantly, for the purposes of the proposals made below, they have ruled out increasing subscriptions in real terms. Although they suggest that subscriptions should increase by the rate of inflation (currently a little over 3% according to the Retail Prices Index), they argue that any further increases would deter potential members, or lead to resignations of current members.

The alternative argument

There are financial difficulties, and these need to be addressed urgently. There is an alternative solution, however, that is entirely different to that of the Senior Management Team.

First, it is not simply the cost of being in a union that makes people join (or leave); it is rather to do with the ability of the union to fight to defend jobs, wages and working conditions – and in a broader sense to defend public education, the resources that go into it, and thus the opportunities for young people. It is a matter of fact that when industrial action is being taken, locally or nationally, membership increases. In other words it is what the UCU does nationally, and in each workplace, that makes the UCU an attractive organisation to join. Simply to assume that a marginal increase in subscriptions of one or two pounds per month is the key issue is to miss the point.

Secondly, we have reason to be more optimistic about the possibility of recruitment, and about the prospects of the UCU growing its way out of the crisis. There is huge potential for recruiting new members in FE and HE.

The alternative financial strategy

Subscriptions – the ‘coffee test’

Members, and particularly Congress delegates, will be astounded to learn that the average cost per member to solve any possible financial crisis for the union would be ONE LATTE per month on top of inflation. That is, an extra £2.50 per month from each member would generate £3.3 million per annum (based on the most pessimistic forecast of membership numbers), and this would more than solve the threatened crisis. This alternative does not propose such a flat rate increase irrespective of ability to pay (for the precise proposal see Appendix 1 to this statement). This average figure is being used here only for illustrative purposes.
That total would be £1.3 million in excess of that which the SMT is proposing to cut from the union’s staffing or from its democracy! ONE COFFEE PER MONTH PER MEMBER! Since it would make sense to have a graduated increase, depending on salary, it would not even be this much for most members. In the first year, not even that much is necessary – in the first instance, in 2013/2014, subscriptions would need to increase by only half that much in real terms, and then only if membership falls as fast as is forecast.

In fact, the increase that would be needed in the absence of ANY improvement in membership recruitment would be far less than this. To balance the books without cuts in staffing or democracy would be, for most members £1.29 or £1.52 pcm (including inflation) in the first year, and an additional real increase in the second year of £1.50 or £1.75 pcm, taking the total increase (over both years) to £2.79 and £3.27 pcm. See the details in the appendices below.

The argument that has been put against subscription increases is that the net benefit is only two-­‐thirds of the headline figure, on the presumption that members will be deterred by higher subs. Yet no evidence has been offered for this. How can people who leave for other reasons be distinguished from those who might leave because of an increase in subscriptions? Since most recent terminations of membership are likely to have been as a result of retirement or redundancy, and there is no sound record of how many leave membership in response to subs increases, there is no evidence available either for this claim or for its opposite. In the circumstances, however, it would be reasonable to suppose that, if only for reasons of straightforward self-­‐interest, few members would be encouraged to leave the union by a small increase in subs.

In any event, this argument misses the point. It is not simply the cost of being in a union that makes people join (or leave); it is rather to do with the ability of the union to fight to defend jobs, wages and working conditions. In education, the attraction of membership is also determined by the union’s willingness to defend public education, the resources that go into it, and the opportunities thus created for young people.

It is a matter of fact that when industrial action is being taken locally or nationally – membership increases. The action around pensions and N30 saw a large increase in membership. In other words it is what the UCU does, nationally, and in each workplace, that makes the UCU an attractive organisation to join.

The question is simply this: are we seriously suggesting that many members would leave the UCU at a time of the greatest threat to public post-­16 education rather than pay an additional subscription equivalent to a cup of coffee each month? That is what it would cost in subscriptions to deal with the financial difficulty.

If we are saying that they would leave then what does that tell us about the reputation of our union? THAT is the ‘coffee test’.

Recruitment and growth

Secondly, there are grounds to be much more optimistic about the possibility of recruitment, and about the prospects for the UCU growing its way out of the crisis. There is huge potential for recruiting new members in FE and HE. The density of UCU membership in FE and HE institutions varies considerably but is usually somewhere between 40% and 60%. Targeted recruitment campaigns, coordinated through regional committees and branch development officers, would pay dividends in beginning to bed down a culture of recruitment in our branches.

There are tried and tested ways in which a branch can raise its profile and encourage colleagues to join. Particularly important is the creation of an effective reps structure in every branch so that members and potential members know that ‘the union’ is just a few doors away, or that there is at least a rep on another floor of the same building.

There are approximately 450 FE and HE institutions. If we recruited a net two members per month per institution on average, we would more than reverse the current rate of membership decline, which has, in any case, already been slowing since this time last year. That figure, two new members per month over retirements, puts the problem into perspective.

This is certainly achievable. The more we achieve this, and replace retiring members, the less will we need to raise subscriptions.

What would make no sense in these circumstances would be either to cut staffing, and thus jeopardise targeted recruiting drives, or to dilute members’ control of the union via its democratic structures, thereby making ‘the union’ seem distant from members and activists rather than as being their own organisation.

The strategy: raising the profile of the UCU

The UCU needs to raise its profile as the defender of post-­‐16 education. It needs to do this through promoting industrial action, nationally and locally, as the key mechanism to win concessions from the employers. It must reject cost-­‐cutting strategies that impinge on union democracy and membership participation, and those that cut staff, and thus the services the staff provide. A cuts strategy will lead the UCU into a spiral of decline.

As an alternative to a cuts strategy, this proposal is for a strategy based on campaigning over pay, workloads, pensions, and a major recruitment campaign to be run simultaneously. We support a mixed strategy of increasing subscriptions (as outlined in Appendix I and II, below), and seeking savings only on those expenditures that do not impact on members’ services.

Swingeing cuts, particularly in staffing, could be disastrous in threatening the very services that are valued by members, and would put additional stress on those staff who remain.

In summary, our strategy and specific proposals are, therefore, that the UCU should:

Grow its way out of financial difficulties through recruitment

From its inception the UCU made a good start in recruitment, but this momentum needs to be maintained. In its first five years it defied the trend in other unions as a result of offering a strategy of resistance to Government policy. Young people in particular need to be convinced about joining the UCU, and this means, in turn, demonstrating that the union can represent and defend them.

We need to identify which branches of the union are below the average for union density, and target them. We need to target them NOT with promises of cheap insurance BUT with a reinvigoration of the branches, and a commitment against every cut, and in defence of every job and every course.

We should consider different forms of branch organisation, those more suited to building the UCU and representing members (for example, enhancing the role of the School representative, holding School-­‐based meetings, organising HPL and Young Member and Researcher groups and meetings to feed into branch meetings). The Waddington report strongly suggests that this would be an effective way of enhancing UCU’s presence, particularly in the bigger institutions.

Increase subscriptions in real terms

As registered above, members will be astounded to learn that the cost per member to solve any possible financial crisis for the union would be one cup of coffee per month on top of inflation,

introduced gradually over two years. The requisite increase needs to be a calculated as a percentage, and then allocated appropriately to the existing bands so as to ensure that the incidence of the increase falls progressively on those who are best able to sustain it out of higher incomes.

The union should not be defensive about this increase. Nor should it simply present the increase in percentage terms, which is misleading when we consider how a percentage of a small sum of money translates into an absolute sum: 15% of £20 sounds a lot but it is only £3 – about one cup of coffee per month.

Meanwhile, members should be aware that 67% of their union subscriptions are tax deductable, so they are entitled to claim back 25% of that 67% from the Inland Revenue. So, for the vast majority of members who do not currently make such a claim to the IR, a subs increase, if accompanied by a tax rebate claim, would see them paying LESS than before the increase! For a member earning over £40k, the total 2-­‐year subs increase would be £3.17 pcm, and the rebate would be worth £3.73 pcm!

Currently, subscriptions are tiered to reflect different incomes. As the income figure stops at £40,000, however, this produces regressive results – that is, the many people whose incomes are higher than £40k pay an increasingly smaller proportion of their income as incomes rise. We suggest the introduction of a new band: £60,000 and above.

Future of the UCU

This is not just an alternative financial strategy for stability and growth; it is equally a political alternative to a version of trade unionism that would be the consequence of the SMT’s proposals – a servicing union that would rarely be engaged in disputes with the employers, or in active opposition to government policy. That is the fundamental choice that is facing branch delegates at this year’s Congress.

Do we want a campaigning union, defending wages and conditions and jobs, and defending public education and the breadth and quality of our provision, as well as providing individual representation and advice?

Or do we want a ‘servicing union’ that largely concentrates on offering individual representation, insurance deals, legal advice and individual support to members?

That is the sense in which this debate is about the heart and soul of the UCU.

Jane Hardy (Hertfordshire) Tom Hickey (Brighton)

A version of this report with the appendices, tables, full figures and references can be downloaded as a pdf here.

page10image174008

Post a comment


RSS Another Education is Possible

Search this site

Follow us

RSS icon facebook button twitter button email button

Diary dates

  • No upcoming events
AEC v1.0.4

Featured videos

YouTube Preview Image