"Some people have been in this building for 45 years, and they are not people who can just walk on to yachts. They are people who have mortgages and shop in ASDA."
All 164 stores will shut. 11,000 workers have been tossed to the wolves after years of loyal service - 8,000 direct BHS employees, plus another 3,000 employed by other in-store retailers, cleaning, catering and security companies. This is the biggest retail collapse since Woolworths shut in 2008.
Yachts v. Job Losses
This woman's quiet anger references the news that the very same week as 11,000 workers and their families face devastation, former BHS owner Sir Philip Green has had another new yacht delivered. A 300-foot vessel valued at £100million, to add to his existing fleet of three luxury superyachts. All so he can cavort with celebs round the world's fleshpots this summer, while 11,000 families wonder if they can still take that holiday they'd booked, now they don't have a job, and now their pensions will be slashed by a minimum of 10%.
BHS Lost the Plot?
Much has been written about BHS losing its purpose and place, outstripped in the mid-market by more stylish products in Marks & Spencer, undercut by fast-fashion rivals like Primark. Younger people rarely shopped in BhS in recent years. It's also true that the shift from bricks-and-mortar shopping to the online version is a challenge, with another 13% increase in online shopping over the past year. But did it have to turn out this way? Are fickle shoppers to blame, as has been the subtext of some of the media commentary?
Retail is a huge chunk of the overall economy; about 10% of it, with retail sales (excluding forecourt fuel sales) of £340billion in 2015. In turn, retail workers make up the single biggest group in the country, with over 3 million of us in the UK, nearly a third of them aged under-25. Tesco, for instance, hires 310,000 workers, making it the biggest private sector employer in the UK (and likewise in Ireland).
Like all sectors of capitalism, retail is run for maximum profit for the owners and a handful of giant shareholders, regardless of the cost to workers and 'consumers'. People are bombarded daily by commercial advertising to mould them into deciding what they 'must have', with the competition between rival retail capitalists absolutely cut-throat in this vast market. The sharks who infest these waters will stoop to anything to engorge their profit margins, either by exploiting laws they helped write through their places on government committees, or by ignoring any inconvenient legislation that might restrict their rapacious appetites for profit.
The successive owners of BHS are typical of this class of ruthless profiteers. The Observer paper's editorial expressed the opinion that BHS doesn't represent a failure of capitalism but a failure of morality on the part of the owners. But the morality of capitalism is rooted in worship of the great God Profit, at whatever cost to the working class they can get away with.
Phillip Green bought BHS for £200m in 2000. When he bought it, the BHS pension fund had a surplus of £5m, rising to £12m in 2001. Now the same pension fund is suffering a black hole of £571m, and BHS as a whole owes debts of £1.3billion.
Green used its initial success to finance his takeover of the Arcadia group (which includes Top Shop) in 2002. He then proceeded to essentially rob it of a fortune, using BHS assets to back loans for other businesses in his Arcadia empire; handing out £422m in dividends (mostly to himself) over two years; above all, dodging Corporation Tax by gifting his Monaco-based wife, Tina, a mind-boggling £1.2billion in 2005. All this helped Philip and Tina amass a personal fortune currently standing at £3.22billion.
Green shamelessly indulged in all this perfectly legal daylight robbery - instead of sustained investment, modernization and adjustments to keep BHS in tune with shifting shopping habits.
Having used and abused it for his own bounty hunt, Green then dumped the ailing BHS (and its pension fund) on a three-times bankrupt, Dominic Chappell, whose Retail Acquisitions Ltd had barely been heard of previously - for a derisory £1, in March 2015.
Three Times a Bankrupt!
Chappell invested nothing; took a salary of £540,000; moved his family into a rented mansion; bought a new Bentley; loaned £1.5m from BHS to his father; and then his Retail Acquisitions took £25m off BHS ahead of it going into liquidation!
The shameless plundering doesn't even end with actual closure of BHS. On one side of the class divide, 11,000 workers don't even know what redundancy packages they will get, and the pensions of 20,000 past and present BHS workers will be slashed by at least 10% - because the taxpayer-funded Pensions Protection Fund only guarantees a maximum of 90% of the pension value to workers. On the other side, billionaire plunderer Sir Philip Green is a secured creditor, and therefore stands to gain £35m from the BHS liquidation process!
Wholesale Slaughter in Retail
The devastation facing BHS workers is neither the first nor last that the vast battalions of retail workers will encounter. As capitalist owners - and the government that upholds their profit interests - seek to slash workers' collective share of the wealth they create, a vicious circle of job losses and real-life pay cuts sweeps the sector.
The Retail Consortium has warned of a bloodcurdling loss of 900,000 retail jobs.
For decades, this was one of the worst-paid sectors of the whole economy - and still is, despite several headline-grabbing increases on the hourly rates of pay over the past 12 months. Several retail giants have gained warm plaudits in the press for raising the hourly rates from last summer onwards - including all the big supermarkets, discounters Aldi and Lidl, IKEA...
For some of them it's to comply with the Tories' obscenely misnamed 'National Living Wage' of £7.20 for workers over 25; for a few, to gain the kudos of the Living Wage Foundation's £8.25-an-hour; for all of them, a partial recognition that low pay not only means low morale but also low spending power - in a consumer-driven 'recovery'. Derisory pay levels and job insecurity across society undermine the ability of working people to spend, thereby making retail jobs precarious, and so the cycle goes on.
Premium Payments Plundered
But behind the headlines, brutal attacks on workers' premium payments and work/life balance are being imposed to pay the price of modest hourly pay rises. So much so that in many cases the very same retail workers are worse off - not only in having to do far more anti-social shift patterns, but in actual, absolute weekly wages too.
Premium payments of double-time or time-and-a-half have been wiped out for most workers for Sundays, Bank Holidays and nightshifts. Workers juggling and struggling to balance work with family life are being robbed of far more of their weekends, especially in the wake of premium payments being scrapped, making it cheaper for the employers.
Thousands of workers have each lost hundreds of pounds in wages through this systematic cheapening of pay in favour of profit. In justifying the abolition of premiums for working ungodly hours for 'business needs', retail bosses on unimaginable salaries and perks trot out deceitful phrases like 'fairness', 'harmonization', 'equalization'. One of them, Tesco CEO Dave Lewis, had the brass neck to coo these soothing excuses on TV - whilst he got £4.6m last year! No wonder a petition demanding reversal of the assault on Tesco workers' premium payments and allowances has already gained 78,000 signatures.
Retail workers have been notoriously difficult to organise into unions in their own self-defense. High levels of turnover, large proportions being on part-time hours, a substantial number being students - these and other factors have meant only about 12% on average were unionized. But growing numbers are seeing the need to get organized. And where there's a strong lead given, retail workers join up to defend and improve their conditions. For instance, in my own large workplace, we've increased USDAW membership from 15% five years ago to over 55% now.
Usdaw boasts the fastest-growing membership of any union in the UK in recent years. But numbers in the union are only the starting point. Unless a clear, determined lead is given by the national union in the face of the wholesale assault by retail capitalism, members will become resentful and resign again. Feeble words about closures and cuts to pay and conditions from USDAW HQ won't pay the bills. Action, pulling together first the shop stewards and activists, then convincing the broad mass of members, is what's needed - but sadly lacking so far.
Many of the companies cutting workers' throats preach the virtues of 'partnership'. Many of them consciously try to bypass the union with variously-named 'employee forums' - comprising hand-picked individuals, moulded to be in awe of the senior managers who dominate these bodies, encouraged to see involvement in these committees as a stepping stone to their own career advancement. They then act as messengers for top management, with the pretence of being workers' representatives.
That makes it all the more urgent and critical that Usdaw stands up for its membership as an independent, collective body of workers, separate and distinct from the top management who execute the erosion of payments and conditions in the interests of the owners.
At the recent Usdaw national conference (Annual Delegate Meeting) in Blackpool, we overwhelmingly passed Motions calling for a £10 minimum wage, abolition of lower youth rates, and for defence of premium payments. That needs to be central to all the union does this year, with action, not idle words.
Instead of negotiating and recommending packages of cuts to pay rates for overtime, nightshifts, Sundays and Bank Holidays in Morrisons and Tescos, the Usdaw leadership should be mobilizing members in resistance. When they say there's no tradition of industrial action in retail, they should be reminded that the same applied to Junior Doctors until recently - and to the Mandate union members in Ireland's Tescos, who voted by 99% to strike against similar attacks - with an 88% supportive ballot amongst the Tesco workers not directly affected.
When closures and job losses are declared, Usdaw should apply the methods deployed by union members in Game and Senza in Ireland last year, when they occupied their workplaces.
Ownership and Control
The whole obscene debacle of predatory capitalist plunder of BHS and workers' pension funds raises point blank the issue of ownership. Instead of working- and middle-class taxpayers bailing out pension schemes that have been plundered by the likes of billionaire Philip Green, and propping up dirt-cheap wages through publicly-funded Tax Credits, Usdaw should highlight the demand that a £10 minimum wage - plus a reinstated system of premium payments - should be funded from the huge profits made by the retail giants, not stolen out of the pockets of workers.
If the choices offered by capitalist retail ownership is basement level hourly pay rates, or slashing of premium payments to compensate for a modest hourly pay rise, plus rampant job insecurity, then they are no choices worth having.
Democratic public ownership of distribution is just as logical as for production. That way, retail profits could be invested in decent wages and anti-social hours premiums; training and upskilling staff; a shorter working week with no pay losses; job security alongside full deployment of robotics and other labour-saving technology; and pursuit of healthy food and environmental protection, rather than short-term profits regardless of cost to people and planet.
Usdaw and other unions have a duty to raise workers' sights to such a vision, but above all need to organise swift, determined action to block the wrecking ball of retail capitalism, which is smashing jobs, livelihoods and the health of workers' lives.