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George Osborne provoked a confrontation with the unions last night by suggesting that a Tory administration could introduce new measures to curb their power.
The Conservatives were considering reforms to employment legislation as a matter of “urgency” because of the threat of widespread unrest in the public sector over pay, the Shadow Chancellor said yesterday.
“I think the public service unions have grown too powerful. We would also look at any changes that need to be made in employment legislation. We are still in the process of looking at what the changes might be,” he told reporters on a visit to a business conference in Liverpool.
Mr Osborne’s aides sought later to downplay his remarks, insisting that there were no firm proposals on employment law under discussion.
Nevertheless, his comments provoked a wave of anger from the unions, which accused him of harking back to Thatcherism. They also contrast with the recent appointment by David Cameron of an envoy to build links with the union movement.
Last month the Tory leader said that he was “delighted” to announce the appointment of Richard Balfe “to help develop our relations with the trade union and cooperative movement. I have always said that free enterprise and the cooperative principle are partners, not adversaries, and cooperatives have an important role to play in public service reform by bringing dynamism without the loss of public ethos,” the Tory leader said.
Mr Osborne, who spoke after addressing the British Chambers of Commerce annual conference, made his comments as industrial unrest was moving up the political agenda.
Serious disruption hit schools, Job-centres and benefits offices last week and this week a dispute over pensions closed the Grangemouth oil refinery.
Mr Osborne said that he had some sympathy for workers who faced the loss of final-salary pension schemes, as is the case at Grangemouth. But he blamed the Prime Minister for his actions as Chancellor when he made changes to pension taxation. He said: “The culprit is Gordon Brown after his pension tax raid which has put companies under enormous strain.”
The Shadow Chancellor also wanted to bring in more private sector companies to deliver public services to “change the culture of public services”, which he accused of being monolithic and vulnerable to strong unions.
He said: “Within a structure of providing free education and services, it would help to improve productivity and help make services less monolithic.” Mr Osborne said that a cultural change was necessary because the public services were not delivering, despite having received a considerable amount of public money.
Unions rounded on Mr Osborne’s threat of employment law reform. Brendan Barber, TUC General Secretary, said: “This is a serious gaffe. If Mr Osborne is saying that employees will no longer be able to defend themselves against cuts in their pensions, he is giving a green light to corporate raiders eyeing companies with well-funded pension schemes.
“The prospect of such a fundamental shift in industrial relations could well make responsible companies wonder whether they should keep a good pension scheme if it simply makes them more of a takeover target. Mr Osborne is seriously out of touch if he thinks people go on strike ‘at the drop of a hat’.
“The truth is that strike action is always a last resort, and employees only give up their pay in today’s world of mortgages and rising bills after considerable thought and due process involving a ballot and notice.”
Tony Woodley, joint general secretary of Unite, said: “These remarks show that David Cameron’s Tories are still wedded to the 1980s agenda of pri-vatisation and union bashing. It seems the modernisation of Tory thinking hasn’t yet begun.”
Dave Prentis, Unison’s general secretary, said: “Mr Osborne has just shown us the Tories’ true colours. They want to weight everything in fa-vour of big business. If they had their way, they would allow their business pals to get rich on the pickings of the public sector and leave the workforce undefended and at the mercy of market forces. No one, except the Tories, wants to go back to the bad old days of Thatcherism.”

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There are critical hubs that may contain small numbers of employees who can exert disproportionate harm on a large scale. These must be identified and the workers be given a distinct code of practice that will curtail any possible disruption. Extra staff in power generation may be a good idea.
kevin, Lincoln, UK
I was discussing just the other day that we seem to be sliding back to the 1970s.
Shutting down oil supplies at a cost of tens of millions, in defence of archaic and unaffordable levels of final salary pensions is unreasonable. I hope some workers pay for keeping it with their jobs.
John, London, UK
The Tories should bring in a law that companies can only have one type of pension applicable to the wealth producers and the executives. Also golden hellos and handshakes should be outlawed. Then we'd get the fairness that Dave and George are promising.
Socrates, Odiham, UK
Cllr Ken Tiwari (independent): Is there no requirement to be able to write English correctly when Becoming a councilor? To those who say that Margaret Thatcher already reduced the power of th unions: she did, but Labour have reversed it, hence 550,000 public sector workers striking this year.
George, Grantham, England
Quite frankly, what George Osbourne has said is what needs to be done. Union powers needs to yet again trimmed. The first thing I think of nowadays with regard to them is various unions strike overing this and striking over that. I'm sick and tired of it.
Ben, Birmingham,
The regressive union laws introduced during the Thatcher years are still in place so how much more harm do the Tories want to inflict on working peoples' right to withhold their labour. Why is is that bosses can inflict whatsover conditions they want on their workforce without penalty?
Tony Probert, Locking, UK
The danger is that we continue bleeding UK Plc with an unaffordable public sector. No party has the guts to say we should cut it by 20%, get rid of final salary pension schemes, and divert investment to wealth creation. Without any urgent reforms UK Plc will soon be the poor man of Europe!
Steve Marchant, Broadhempston, UK
Union power is very weak in this country, any attempt to stop the basic human right to withdraw labour would bring us nicely in line with totalitarian regimes.
tom, london,
Anybody who thinks that this bunch of public schoolboys are going to take over and improve things overnight is deluding himself. Thatcher copied Reagans policies in 1979 and screwed up the economy in two years and was forced to increase taxes after promising tax cuts. Baby George will have 2learn
Grocer Ted, Hammersmith, UK
Dave really cares about the poor and worries about the wealth gap between the rich and poor. To allow him to sleep at nights, why not increase the upper tax rate to where it was for most of Thatcher's reign and cut tax on poor hardworking people. Also make all employees have equal pension rights.
claudius, Basingstoke, UK
Not all public sector employees have generous pensions, big salaries and claim excessive amounts of expenses. The Tories have to be careful here. Working people have the right to protect their living standards even if it means striking as a last resort. Cameron, word in Osborne's hear please.
clive, dartford,
Re Dave,Slough
Do you really think that Osbourne will remove final salary pensions for MPs since he is one. INEOS inherited a fully funded pension scheme and are simple asset strippers. If the tories are supporting company's like this every employee in the UK better watch out if they are elected.
Fergus Nicol, Aberdeen, Uk
I remember that the last time the Tories were in power they sacked all of the hospital cleaners and outsourced the jobs to private cleaning firms to improve services and to smash the unions. Hence we got dirty hospitals cleaned by poorly paid and motivated cleaners which lead to the spread of MSRA .
Doubting Thomas, Hammersmith, UK
At last the elephant-in-the-room gets a mention. Osborne continues to do a fine job. Only true courage will deal with the public service pensions monster. Attaboy, George, and ignore the squeals of the little piggies on this government's gravy train!
tim holden, budleigh salterton,
Quite right too. Those of us who have watched their taxes and their retirement age go up and up and up and seen the £100K a year doctor, MPs helping themselves to massive "expenses" to inflate their salaries, the preservation of fat unfunded pensions etc. whilst services get worse agree.
Dave, Slough,
His comments were taken out of context. Osborne said he would reduce union powers (not enact lower pay). It is sick that unions strike over anything and demand inflation busting increases. Some professions (eg ambulance service, pharmacists) dont strike as it is immoral, they change jobs instead.
R, London,
Why should we be held to ransom by public service unions intent on maintaining luxurious pensions and perks (along with good salaries in spite of their endless complaints) at our expense?
Peter, London,
It looks like George Osborne has more balls than appeasing Cameron.
It is this sort of talk, challenging leftist socialist unionist attempts to reengineer Britain, that middle England is looking for - not a Guardiansita/BBC version of Blair/ Brown
Osborne has gone up in my estimation
David Cartright, Birmingham,
Simple solution. Link all public service pay awards and terms and conditions to that of MP's.
Rick Weston, Salisbury, Wiltshire
As long as irresponsible bankers and incompetent CEOs continue to award themselves obscene salaries and bonuses,
workers must have the right to demand pay raises in line with inflation and fight to protect their pensions rights from raiding tycoons without being labelled greedy or be threatened
matilde, London,
Just when Tories were starting to appeal to those in the public sector who are desperate to get rid of Labour, they revert to the old Thatcherite agenda. We're fed up with year after year of below-inflation pay increases and falling living standards. No wonder so many are prepared to go on strike!
Matthew Hetherington, Cheltenham, UK
New private businesses are not dominated by unions so no need to repeat the Thatcher era stupidities that destroyed so much industry.The best way to reduce the size of the public sector is to recreate the vibrant economy of the 1960's where the best jobs, highest wages were outside of government.
Chris Coles, Medstead, Alton, United Kingdom
How can folks with an element of realism not easily spot this tory distortive hype..........................Their whole concept it seems is to disregard social justice and move back 150 years creating a country of victorian oppressive working conditions......grow up Osborne
Eric, Southwick, West Sussex
I wish i could understand why this media, the times hate union
so much, you only print comments by those attacking Unions,
and not likes of me the unionist, i said this before, our union's
have no more strength, you and your Mrs-or-Lady Thatcher did
all the harm you could to us ordinaryPeople!
Cllr Ken Tiwari (independent), Oxford, United Kingdom
Oh Dear, just as the Tories look like being a party to ged rid of nulabour, they shoot themselves in the foot. Sure we dont want to go back to the bad old days, but we sure as hell have had enough of watching executives get unreasonable rates at the expense of the workers! And as for bankers, well?
Pete, St Albans, England
The Union have no pwer in UK, thats been dismantled by
first Mrs Thatcher's-side kicks, and then Tony Blair's cronies,
so please don't fear of union in UK, there are'nt any ?
Cllr Ken Tiwari (Independent), Oxford , United Kingdom
George, stand for your belief. I fully support your view, the Union has become overly powerful under New Labour. I would like to see the Conservative government outlaw strikes all together - though probably not possible under ECHR, and give power to make arbitary body's decision legally binding.
choy, london, uk
The man carrying the banner in the main photo looks like Jim Mather, the SNP's Enterprise Minister. Whose side is he on?
Bill Peter, Kuala Lumpur, Malaysia
again we are seeing the true face of tories and thats before getting in to office. i don't know why they constantly oppress the unions where they know eventually they'll come out losers.what is wrong with our politicians? why are they always banging on unions doors?what do they achieve but hatred .
ebbi britt, valencia,
Mr Osborne is just grandstanding for the local elections, that's all. Any considerations I may have had to vote Tory have now disappeared. (I shan't be voting NuLab of course though).
Paul, Coventry,
No one wants to return to the days of the 1970s. However, the workers of this country have had 25 years of being told to "get on their bikes", be more flexible, work more hours etc. I was ready to vote conservative at the next election but not if this is their intention again.
Chris, Banbury,
when will the torys attack the bankers and spculator who have brought about the latest bout of financial ruin.these are the people who awarded them selves millions in bonus pay ments for little or no effort,who then walked away with even more millions for the damage they have caused.
william rogers, cardiff,
Alread been done George by Thatcher - remember ? Or were you still in nappies ? Only other areas to reform are the rights to strike altogether which I am sure the Tories can't wait to impose on us all !!!!!
Ian Payne, WALSALL,
Trade unions are greedy just like Labour. Look at the current government how many ever had a real job before coming into power? If you have never had real job, how can you know the value of money which goes some way to explain Labour tax and waste policy because they do not know the impact tax has
steve tea, manchester, cheshire
No chance of balanced argument from Mr Osborne then. I thought peace was obtained by equilibrium not putting all the power into the hands of so-called market forces.
Terry, Newcastle, UK
Teachers striking despite 10 eyars of beneficial treatment under New Labour. Grangemouth striking (among other things) for the right of future workers to join a now unsustainable final salary pension scheme (absurd). Public sector unions opposing efficiency reforms. Go for it George!
ROHAN, Solihull, UK
It is good to see left wing unionist rabble coming up from the sewers, strange a strong voice from Scotland
the reason why labour in parliament is propped by Scottish left wing. The country does not want union power back. From 1945 the unions had full control of the country look what happened.
Barry Holmes, Christchurch, New Zealand
Mike O' Conner,
The miners pension fund still opperates,I believe one of it's recipients was Mr Arthur Scargill, I believe he is still recieving the grand sum of 19 shillings per week, (95p) after years of working underground .
Wish we had a Thatcher to take on the bloated civil servants now.
Geordie, Perth., Australia.
trade union leaders are simply parasitic in their function. they produce nothing and create zero wealth. They invest nothing that creates the wealth that pays their members wages in the public sector but complain when things get tough. they never put their money were their mouth is.
BD MATHERS, birmingham,
A return to the imes when Trade Union leaders such as Joe Gormely head of the NUM was on the payroll of Special Branch, I certainly hope not. If ever there was the case for a workers revolution now is that time before these greedy grabing selfish capitalist wretches destroy this planet.
Keith Hendry, Edinburgh, Scotland
Perhaps Mr Osbourne should also visit the remunerations of company executives. Lower echelon employees always have to compromise while the upper echelon vote themselves substantial pay rises regardless of how well the comapny performs.
One law for the rich and different laws for the poor.
Ray Harvey, Hitchin, UK
Talking of pensions and the great demise of them.
Whatever became of one of the flagships of the pension industry namely the miners pension fund?
Was it too absorbed into government coffers?
Mike O' Connor, Plymouth, uk
If the Tories true colours are to stop a return to problems caused by Trade Unions in the 1970/80s period then good look to them no one wants a return to those times. Mr Osborne is also correct when he tells the Unions the man responsible for the pensions meltdown is GB and not the employers.
Dave, Mold, Flintshire