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FM AMEMBASSY LONDON
TO RUEHC/DEPT OF LABOR WASHDC
RUEHC/SECSTATE WASHDC 7365
INFO RUEHXI/LABOR COLLECTIVE

UNCLAS SECTION 01 OF 03 LONDON 000425 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
E.O. 12598:  N/A 
TAGS: ELAB SOCI UK
SUBJECT:  DOL ADVISOR BRUMFIELD DISCUSSES LABOR PRIORITIES WITH HMG, 
UNIONS AND EMPLOYERS 
 
 
¶1.  (SBU) Summary: William Brumfield, European Area Advisor and 
Foreign Service Coordinator at the Department of Labor (DOL), 
visited the UK to discuss labor priorities with HMG, Unions and 
Employers.  At HMG he was told that James Purnell, the new Work and 
Pensions Secretary, will prioritize welfare reform.  The UK has set 
itself an "aspirational target" for employment of 80 percent, up 
from current levels at approximately 72 percent.  An official from 
the Trades Union Congress (TUC) discussed the UK labor movement's 
focus on the Temporary Agency Workers Directive.  Unions are calling 
for the creation of parity between the working conditions and 
benefits of temporary workers and permanent employees.  On Gordon 
Brown, Brumfield was told that while the Labour Party has seen a 
change in leadership, there has not been a change in substance.  A 
meeting with the Confederation of British Industry (CBI) discussed a 
downturn in economic growth which has hurt public finances. 
However, the UK housing market is not as vulnerable as the U.S's 
because the UK still has a housing shortage.  End Summary. 
 
HMG Prioritizes Welfare Reform 
----------------------------- 
 
¶2.  (U) In a meeting at the Department for Work and Pensions (DWP) 
with Satish Parmar, of the International Employment and Social 
Policy Division, and Paul Russell, of the ILO, UN and Council of 
Europe team, Brumfield was told that James Purnell, the new Work and 
Pensions Secretary, will prioritize welfare reform.  In his new 
position, following Peter Hain's resignation, Purnell will focus on 
raising the UK employment rate by getting more lone parents, 
disabled people, and ethnic minorities into work.  Personalized 
employment advice and 'city strategies' will be used to increase 
employment amongst these groups.  Incapacity benefit will also be 
reformed into a new Employment and Support allowance.  The support 
allowance will go to people who have no capacity to work.  The 
employment allowance, which will be a lower level of assistance, 
will go to people whose capacity for work has been assessed and who 
undertake mandatory activity to get back to work.  The government 
has set itself an "aspirational target" of 80 percent employment, up 
from current levels at approximately 72 or 74 percent. 
 
¶3.  (SBU) Parmar discussed the UK's bilateral relationships.  He 
noted that DWP has a rolling program of meetings with counterpart 
ministries in France and Germany.  He went on to observe that, based 
on a recent visit from a high-level Canadian official, the UK and 
Canada are going to initiate a reciprocal study tour whereby a group 
of officials from the UK visit Canada with a "shopping list" of 
things that the UK is interested in seeing and vice versa.  Parmar 
said there would be interest in introducing the same type of 
exchange with the U.S.  DWP is also finalizing an international 
strategy, which now needs to be signed off by Ministers.  It will 
identify what all parts of the department are doing in terms of 
international engagement.  It is intended to lead to a more coherent 
international approach across the department. 
 
HMG's Participation in International Labor Meetings 
---------------------- ---------------------------- 
 
¶4.  (SBU) On the OECD's LEED meeting in Venice, Parmar said that it 
is unlikely to be attended at the Ministerial level.  The UK has not 
previously placed a high value on these meetings, only attending one 
or two at a junior level.  However, the focus on addressing local 
problems, including money for local regeneration, is now high on the 
UK agenda.  Caroline Flint, Minister for Employment prior to Peter 
Hain's resignation, had expressed an interest in attending the 
meeting given its focus.  However, they are still waiting to see if 
Stephen Timms, Flint's replacement, will attend.  It is highly 
unlikely, however, that Purnell will go. 
 
¶5.  (SBU) On the G8 preparatory meeting, Parmar said he will be 
attending on the UK side along with Liz Tillett, Deputy Director of 
the International, Employment and Social Policy Division.  The UK is 
looking to agree on outcome-based employment objectives, which will 
be useful to persuade other European countries of the benefits of 
adopting policies less likely to promote benefits dependence.  With 
regards to the Ministerial meeting, Peter Hain had agreed to attend. 
 It is likely that Purnell will attend but they are awaiting 
confirmation.  If he does not attend, Stephen Timms will attend in 
his place. 
 
Unions Prioritize Temporary Workers, 
Public Sector Pay and Open Skies Agreement 
----------------------------------------- 
 
¶6.  (SBU) Owen Tudor, Head of International Relations at the Trades 
Union Congress (TUC), said the Temporary Agency Workers Directive is 
a primary focus of the UK labor movement.  The labor movement is 
calling for the creation of parity between the working conditions 
and benefits of temporary workers and permanent employees.  This 
issue, Tudor said, is currently on Brown's desk, awaiting a 
decision.  The issue will be focused upon by the French Presidency 
of the EU.  By that time, Tudor opined, the EU Reform Treaty will 
 
LONDON 00000425  002 OF 003 
 
 
have been approved (for which the government needs the employers' 
support) and the government will be in a position to accept the 
Directive. 
 
¶7.  (SBU) In terms of public sector pay, Tudor said that everyone 
knows the "money is running out".  Unions acknowledge that some cuts 
need to be made.  However, Tudor said the government's argument that 
staged pay awards are necessary to restrain inflationary pressure is 
not acceptable.  Instead, HMG should argue that it's done because of 
public borrowing requirements. 
 
¶8.  (SBU) Brumfield also met with UNITE's Brendan Gold, National 
Secretary for Aviation (T&G section) and Paul Talbot, Assistant 
 
SIPDIS 
General Secretary (Amicus section).  Gold's union represents the 
aviation sector except for pilots and air traffic controllers. 
Unlike most unions, their membership is growing, by about one 
thousand a year, on top of the 75,000 in aviation already part of 
the T&G or Amicus sections of the newly-merged mega union UNITE. 
(UNITE is the UK's largest union, with over 2 million members.) 
Gold is also the vice chair of the European Transport Federation and 
the International Transport Federation.  Current priority for the 
ETF is a pan European agreement with low cost, but unionized 
European carrier EasyJet.   For the ITF, it is Open Skies and 
"social dumping" (seeking trade advantages by exploiting workers). 
Gold said the key to organizing workers is to fight for local issues 
(a break room, better food) and signing up members.  Talbot had a 
similar take.  Unions don't want to get involved in the nitty gritty 
issues at the shop floor level, but that is how members are 
recruited. 
 
TUC Critical of Brown's 'Dithering' 
---------------------------------- 
 
¶9.  (SBU) Owen Tudor stressed that while the Labour Party has seen a 
change in leadership, there has not been a change in substance. 
While Brown was keen to imply that he would usher in a completely 
new administration, the biggest change has been one of style.  Tudor 
said that accusations in the press of Brown 'dithering' over 
decisions were accurate, that it is difficult to get him to make a 
decision.  His long-term focus means decisions are not made quickly 
or easily.  He said there is less Ministerial control of government 
business, with more done at the center, amongst Brown's close 
allies. 
 
Employers Discuss Economic Environment and Temporary Workers 
-------------------------------- -------------------- 
 
¶10.  (SBU) Speaking for the UK employers group that attends the ILO 
meetings, Neil Carberry, Head of Pensions and Employment at the 
Confederation of British Industry (CBI), said the Brown government's 
policies were not much different from Blair's, but the economic 
environment had changed.  Public finances were problematic, because 
economic growth had declined 17 percent in a year.  The UK housing 
market is not as vulnerable as the U.S.'s, in Carberry's view, 
because the UK still has a housing shortage.   Brown is under 
pressure to spend on programs to rein in unruly parliamentary 
backbenchers upset about the EU treaty, but he hasn't the money in 
his budget.  Hence the proposal for a rise in the capital gains tax, 
which upset the business community and had to be abandoned. 
Carberry said the government was legislating but not enforcing work 
place rules.   The pending EU vote on a Temporary Agency Workers 
Directive was "totemic" for the trades unions (the same term used by 
Tudor at the TUC).   The law would give temporary workers the same 
employment rights as full time direct hires after a certain period 
on the job.  The dispute is over the qualifying time period.  The 
unions want 6 weeks, the employers (and HMG) want one year, but 
might accept 6 months.  Both sides say it is more about rights than 
pay. 
 
UK ILO Office to Be Replaced by Desk Officer in Geneva 
---------------------------- ------------------------- 
 
¶11.  (SBU) In a meeting with Lord Bill Brett, currently Director of 
the ILO Office in the UK, Brumfield was told that the UK's ILO 
Office is closing and that Lord Brett will end his representational 
role this year.  The office will be replaced by a UK desk officer in 
Geneva.  On the position of Director-General, Lord Brett believes 
Somavia will go for another term and will get another term.  He said 
that Somavia has unfinished business and is likely to reform the ILO 
quite dramatically.  Additionally, there is nothing on the horizon 
that will attract him away from the ILO.  He said that it is highly 
unlikely that the ILO will introduce two-term limits (which HMG is 
pushing for) as it is not in the interests of either the workers or 
employers.  On Gordon Brown, Lord Brett believes he did well to get 
MPs to accept a 1.9 percent pay rise.  In doing so, he isolated the 
police.  He also said that the various one day strikes will not have 
created much fear within the government.  He said the big problem on 
the horizon will be pensions. 
 
 
 
LONDON 00000425  003 OF 003 
 
 
TUTTLE