35 business leaders intervened on the eve of Chancellor George Osborne’s comprehensive spending review, urging him to press full speed ahead with his cuts by arguing that any public sector job losses would be offset by the private sector.
The letter in the Telegraph on Monday is however at odds with their own personal records, where many of the firms they manage have been responsible for redundancies during the straitened times of the last few years.
They say in the letter:
“The private sector should be more than capable of generating additional jobs to replace those lost in the public sector, and the redeployment of people to more productive activities will improve economic performance, so generating more employment opportunities.”
Among the signatories to this are:
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BT chief executive officer Ian Livingston who has overseen the loss of some 35,000 jobs since 2008, with another 5,000 redundancies still feared
- GlaxoSmithKline chairman Sir Christopher Gent, where 4,000 jobs went in January, even after a year of profits which were made possible ironically enough by state spending on swine flu vaccinations
- Yell chairman Bob Wigley, where 1,300 jobs have been shed since 2008
- B&Q currently have 1,000 jobs at risk, and have not replaced 3,000 staff who have left since 2008. The DIY chain’s owner is Kingfisher whose chief executive Ian Cheshire signed the letter.
- Marks & Spencer saw job losses of 1,000 in January 2009. It didn’t stop chairman Sir Stuart Rose signing the letter.
- Car Phone Warehouse chairman Charles Dunstone, where 450 jobs were lost last year.
- Microsoft cut 150 jobs in the UK last year, and more are expected. MD Gordon Frazer signed the letter.
The list is long. 10% of the workforce has been lost at Aveva and Sage over the last few years, yet Nick Prest (chairman) and Paul Walker (chief executive) respectively saw no contradiction in their political statement. Arup have lost 20% (Philip Dilley, chairman).
Diageo CEO Paul Walsh is on the list, despite the well-publicised loss of 500 jobs in Kilmarnock last year. Whitbread (Anthony Habgood, chairman), who run Premier Inn and Costa coffee, shed 600 jobs last year, while Britvic (Gerald Corbett, chairman) shed 50 in Northern Ireland six months ago. Corbett is also chairman of SSL, who own Durex, and who also expect job cuts soon.
Maybe some of these captains of industry suffer from amnesia. The most breathtaking case must then belong to the executive chairman of Boots, Stefano Passina, who just two weeks ago announced 900 job cuts.
600,000 people are expected to lose their jobs in the coming period (and that's the Tory OBR's estimate), and the gentlemen above look set to contribute to the reemployment of not a single one of them, but still see fit to agitate for the increase in unemployment in addition to their own direct contribution to it.
They claim in the letter that:
“There is no reason to think that the pace of consolidation envisaged in the Budget will undermine the recovery.”
However, ASDA finance director Judith McKenna is on record saying: “The scale of public sector cuts and increased taxation is without doubt a concern to customers. While we hope for better times ahead, we're certainly not planning on that basis”. ASDA chairman Andy Bond, nevertheless signed the Telegraph letter. He can’t claim he’s not well advised.
Next chief executive Sir Simon Wolfson signed it, despite only last month (amnesia again) saying that the boom time was over for retailers for the foreseeable future due to spending cuts. Lord Wolfson is a Tory peer, and should have just signed the letter as such.
I agree with the September Sir Simon rather than the October Lord Wolfson. The private sector has already faced tough times over the last few years, and fewer people with money to spend due to increased joblessness means even less consumer confidence and demand moving forward. What these business leaders have signed up to is the strangest suicide note in history. Given the harm it does the public, it would also be the longest boycott list in history, if it wouldn’t just end up in more job losses.
The country is not a business. The state cannot callously cast aside and eliminate the people it puts out of work. It continues to pick up the bill, not just in economic terms, but social too. Unless they are willing to put their money where their mouth is and guarantee a job to everyone put out of public sector employment, they should keep quiet and start creating the jobs they speak of.
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