Unions tell Starmer to redistribute wealth via energy bills
Britain’s biggest federation of workers, the Trades Union Congress (TUC), has called for the government to impose an “emergency social tariff” and massively redistribute wealth in the face of rising energy bills.
In the week when Nigel Farage claimed that Reform UK was now “the party of the workers”, the TUC has asked the Labour government to adopt its radical programme with the current energy price cap expiring this month and household bills consequently due to rise.
Paul Nowak, the general secretary of the TUC, told the New Statesman: “It’s crucial to show working-class people and their families that the government is on their side and with Nigel Farage’s claim that Reform UK is the party of workers this week, it’s important that every decision the government takes is sending a signal to working people that it’s for them.”
The proposed “social tariff” would knock money off annual bills according to household income and be paid for by an increased windfall tax on Britain’s banking sector, which Nowak says is “doing very well at the moment”.
For the lowest income households, the TUC proposes a 30 per cent reduction in annual bills, equivalent to a £559 saving each year.
It has also set out help for more middle income families. Under the scheme, households earning below the median income would enjoy a 20 per cent reduction (£373 a year) while middle and some higher income households would get 10 per cent off (or £186).
Taken together this would mean the government intervening to support 65 per cent of all UK households (with 35 per cent, the highest earners, receiving no support). The TUC claims its policy would have the positive knock-on effect of reducing headline inflation by between 0.3 and 0.4 percentage points.
The scheme is estimated by the TUC to cost £3.4-5.9bn per annum. The union body says it would ideally be paid for by an increase in the windfall tax on banks, projecting this could raise up to £60 billion over the next four years.
While the TUC has asked the government to consider their scheme as an emergency measure, the body has also said it should become a permanent feature of the British economy to shield workers from volatile global energy markets.
This week, Farage asked unions to break their allegiance with Labour and affiliate instead with Reform after a poll showed that his party was as popular among trade union members as Labour. He has invited the 48 unions affiliated with the TUC to attend his party conference in September.
While by its own rules the TUC cannot affiliate with the Labour Party or endorse it explicitly at elections, the body has a historic link with Labour and enjoys broad access and good relations with many Labour MPs, in part through its federated member unions which are affiliated with Labour.
On the topic of Farage’s gambit this week, Nowak was withering. “This policy would be equally popular with Reform voters as it would be with Labour and Green voters. But for me, the idea Nigel Farage stands up for working class people is laughable if you look at his voting record, his support for Trump and his tariffs,” he told the NS.
Nowak has also said that Farage would be unwilling to redistribute wealth from banks and other corporate interests if he were to gain power. “Our members will see through Farage for what he is and how he is absolutely in hoc to corporate interests,” he said.