From the TUC

The TPA ‘cost-cost’ analysis of unions

25 Nov 2011, By

Some things in life are inevitable – death, taxes, change, the seasons. But perhaps nothing is quite as inevitable as the fact that a report from the so-called Tax Payers Alliance will be about as balanced as a two-wheel trike.

Their latest opus sets out what it calls a ‘scandalous subsidy for unions’ conflating facilities and facility time for union reps in the public sector, with other types of support such as that provided through the Union Learning Fund – an initiative that has won widespread support from employers and Ministers alike.

Leaving aside the usual mistakes and/or deliberate omissions (the NFU is a ‘union’ apparently though I can confirm they have not indicated their official support for the TUC’s Day of action on November 30,  and there is no mention of the fact that in some cases unions make payments toward the costs of facilities and time-off arrangements) the report’s major flaw is that it purports to highlight the COSTS (allegedly £113m) of such support, but studiously avoids any mention of any BENEFITS that may accrue from such support.

Thus the traditional cost/benefit analysis’ that most organisations or individuals would use to assess whether or not something represented value for money, is replaced in the world of the TPA by a slightly more simplistic ‘cost – and only cost -analysis’.

But fear not. A rigorous cost/benefit analysis of public support for union facilities and facility time was undertaken by the Department for Business in 2007. This found that the benefits of union representation far outweighed the costs to the tax-payer (we’ve summarised this in the past).

In fact it showed that reps across the public and private sector give their employers and fellow employees about £115m of their own time every year (at 2007 prices) – which by neat coincidence slightly exceeds the £113m that the TPA claims unions receive in public support. But the benefits of union representation go way beyond the time that union reps put in of their own accord.

Across the public and private sector the analysis concluded that union reps accounted for:

  • Savings to employers and the exchequer of between £22m – £43m as a result of reducing the number of Employment Tribunal cases;
  • Benefits to society worth between £136m – £371m as a result of reducing working days lost due to workplace injury and;
  • Benefits to society worth between £45m – £207m as a result of reducing work related illness.

In addition, using the same formulae used in the BERR report but with updated figures, it can reasonably be estimated that the work of union reps also results in;

  • Overall productivity gains worth between £4bn to 12bn to the UK economy;
  • Savings of at least £19 million as a result of reducing dismissals;
  • Savings to employers of between £82m – £143m in recruitment costs as a result of reducing early exits.

One would have thought that an organisation that claims to want to SAVE the tax-payer money would therefore be rather in favour of unions. But instead Britain’s ‘independent grassroots campaign for lower taxes’ (no sniggering at the back) seems, as a point of principle, to object to government spending ANY money that may support trade union reps carrying out their duties, even if that money generates higher, real and measurable benefits for employers, the tax-payer and UK PLC as a whole. Hmmm.

This doesn’t really seem to make any sense at all. But then little about the TPA makes sense. One would have thought a significant grass-roots organisation could have mustered more than a few hundred people for its ‘Rally against the Debt’ just weeks after the TUC mobilised half a million to ‘March for the Alternative’. And for an organisation that talks a lot about the need for financial transparency, its own ‘Annual Review’ is somewhat opaque on its major sources of funding (recently raised here as well).

Of course the largest, most democratic organisations made up of grass-roots ‘tax-payers’ in the UK are actually trade unions – whose six million members in the public and private sector do pay tax, do use and value public services, and who are actively supporting union campaigns to make taxes fair. If that sounds like you, don’t despair – there is a Tax Payers Alliance for you as well!

One Response to The TPA ‘cost-cost’ analysis of unions

  1. Gregor Gall
    Nov 25th 2011, 5:50 pm

    More on this from Union News at

    We should take note that the TPA thinks hay is to be made at the moment on this issue.