Labour’s latest back-of-a-napkin policy is to compel companies to fully hire workers on regular hours after twelve weeks of ‘zero hour’ contractual work. It stinks of Labour’s woeful ignorance of how business and the economy works. They have no understanding of markets and, short of a Marxist revolution and the overturning of Western civilisation, this can only possibly have disastrous consequences for working people.
Back in 1997, the British people elected a ‘reformed’ Labourite, Tony Blair, who had come to accept that – in order to better peoples’ lot across society – you have to work with the markets, not against them. Now, in 2015, Ed Miliband and Ed Balls seem to present an alternative of ineptitude and turmoil for the British economy.
The key problem with this policy is that a lot of employers will simply rearrange their handling of zero hour contractual employment to avoid unnecessary cost. Like most people in society, they won’t gleefully choose to pay more or be constrained more than they have to – that’s how a market works; choice is one of the many aspects of freedom.
If forced to pay a great deal more to the government after twelve weeks, a lot of employers will terminate those zero hour contracts after eleven weeks. Simple. That means that people who would otherwise be working on zero hour contracts will not be working at all – they will be poorer. It also means that people (such as students, young parents, and close-to-retirement workers) who prefer the flexibility of zero hour contracts will no longer be able to work within that parameter of flexibility under a Labour government – they will be poorer and less free to make their own choices.
Whatever ‘good intentions’ the Labour leadership might have (if they do, which is far from certain), this is a policy that attacks jobs, workers, and some of the very poorest people in Britain. And it does so because Labour has ditched Blair’s guise of a reformed ‘Third Way’ in politics, and has reverted to full-blooded, unreconstructed state socialism – a crackpot set of ideas that has only ever harmed workers and the poorest in our communities.
As the son of someone currently on a zero hour contract, I don’t believe that every person on them is an exploited surf being crushed by the system. A lot of them are people who have found themselves in a situation where this is preferable to the alternative, or even their first preference. Labour’s universal loathing of more flexible employment is out of touch with reality.
But it doesn’t stop at this policy. Labour’s promise to ‘freeze’ energy bills somewhat backfired when energy costs came down and so customers received cuts in their energy bills. If those previous higher prices had actually been frozen – as was the Labour mantra – we’d all now be paying artificially higher energy bills; even higher than the energy companies wanted to charge us. It was madness to promise a freeze without any knowledge of how the markets would perform in the next year – it comes from a deep-seated ignorance of how the economy works and a wilful decision to reject reality and revert to socialist dogma.
Along with a whole ream of current Labour policies, these are examples of how out of touch with reality the Labour party really is.
Our economy is starting to look a lot healthier after a prolonged period of gloom following the economic crash of 2007. We now have more people in work than ever before, the highest growing economy in the developed world, and the deficit has been halved since 2010. Some would like to have gone further with the deficit reduction programme, and there is plenty to debate about what is best for the British economy in the next five years. The work so far has been successful, but not everything is suddenly made ‘perfect’, and so there are debates to be had.
But those debates should be based on reality and sensible proposals, working with the world as we find it rather than wishing it away. Unfortunately, under Ed Miliband’s stewardship, the Labour party has become an outdated, out-of-touch rabble, completely ignorant of economic reality. It is an incredibly dangerous mix, and could be disastrous for ordinary, working people across Britain.
If you thought that rising unemployment, a spiralling deficit, and destructive management of the economy under Gordon Brown was bad, there is one thing to be said if Ed Miliband enters Number 10 after this election: you ain’t seen nothing yet.