A total of 28,000 North East workers are on zero hour contracts for their main job.
The figure amounts to 2.3%, or one in 43, of the region’s workforce. However campaigners say it could be much higher.
According to the Office for National Statistics, nationally the number stands at 697,000 which represents a 100,000 leap in the past 12 months.
And because workers often have more than one job, the number of employment contracts offering no minimum hours rose from 1.4m to 1.8m in that time.
The ONS said the near 30% UK increase might not be as a result of a surge in zero hours contracts being offered but due more to increasing recognition of the contracts by staff when asked by researchers about their employment terms.
Neil Foster, policy and campaigns officer for the Northern TUC, said:
“When we’ve been campaigning on quality employment issues we find that a lot of people who are on a zero hour contract aren’t even aware that they are on them.
“Work from the Chartered Institute of Personnel and Development has indicated the number of people with no guaranteed hours could be several times higher than others have traditionally picked up.
“Zero hours contracts are not defined in law and while this might be problematic for the statisticians they prove even more of a headache for the workers employed through this form of work.”
The ONS figures revealed people on “zero-hours contracts” are more likely to be women, in full-time education or working part-time.
More than 34% of people on “zero-hours contracts” are aged 16 to 24, a figure in the North East that looks set to rise.
And 34% of people on them want more hours though, according to the ONS, this could be linked to a higher proportion of “zero-hours contract” jobs being part-time.
Some of Britain’s largest employers offer zero-hours contracts including JD Wetherspoon, Burger King, McDonald’s and Sports Direct owned by Newcastle United’s billionaire boss Mike Ashley.
Even Buckingham Palace has offered the contracts to staff working in the summer when the Queen’s main residence is open to the public.
Mr Foster added:
“Many people on these contracts need and want more hours and greater certainty but instead find themselves at the beck and call of employers and in quite a vulnerable situation.
“Working people need to be able to look forward to the future and a real economic recovery relies on greater confidence – but zero hours contracts simply don’t provide that.”
Source – Newcastle Evening Chronicle, 25 Feb 2015
The billionaire owner of Northumbrian Water is at the centre of a documentary being aired on North East screens on Monday (12 Jan) night.
The water company, owned by Hong Kong-based Li Ka-shing, one of the richest men in the world, has made more than £630m profit in the last two years, according to BBC investigations programme Inside Out.
But the firm pays on average less than 10% tax because of a legal tax loophole, the show will claim.
Northumbrian Water told the BBC that the company always acts transparently and within the letter and spirit of the law, adding that it is not in dispute with HM Revenue and Customs on its tax affairs.
But presenter Chris Jackson will tell viewers:
“Northumbrian Water sounds nice and local but when you pay the bill you may be surprised to learn the profits leach away to the other side of the world.”
Mr Li is the richest man in Asia, and 17th richest in the world, with an estimated wealth of £20bn.
He owns Superdrug and the Three mobile network, invests in Spotify and Facebook and has owned Northumbrian Water, which employs 1,600 staff, since 2011. He also runs a charitable foundation.
In terms of his North East assets he ranks alongside Mike Ashley and the Duke of Northumberland – except nobody here has ever heard of him, says Jackson who asks in the show:
“Of all the things he could have bought in the world, why did he buy a slice of the North East?”
Interviewee Professor David Hall of the University of Greenwich, will tell the documentary:
“The UK government provides a regulatory environment which most people think of as protecting the consumer, but its core objective is to ensure that the companies continue to make enough profits so that they want to carry on investing.”
In the last two years, Northumbrian Water has paid less than 10% tax on £630m profits, compared with the 20% standard corporation tax, because it has borrowed £1bn from Mr Li, Jackson will claim in the documentary.
The government has looked at closing the tax loophole – which is completely legal – but decided against it, prompting Labour MP John McDonnell to attack the situation in the House of Commons last year. He said:
“No wonder he’s the world’s ninth richest person. We’re making him the world’s ninth richest person. I think this is a scandal.”
> Earlier the article named him the 17th richest person. Perhaps he’s lost a bit since last year, poor dear. Down to his last few billion.
Mr McDonnell is calling for an independent public inquiry.
Nobody from the government would be interviewed for the programme, but a statement from the Treasury said recent analysis showed that changing the system used by Northumbrian Water would not save money and would undermine the competitiveness of the British economy.
Most utility companies in the UK now have owners dotted across the world, the programme will say.
> Well of course they are – subsequent governments – of all colours – since Thatcher have been obsessed with selling off the family silver to the highest bidder. A process that continues today with the NHS and DWP.
Barbara Leech, from the Consumer Council for Water which represents customers, will appear in the documentary describing how Northumbrian Water – which provides water supplies to the homes of 2.7m people in the North East – is top of the league in terms of satisfaction with services.
The full story can be seen on Inside Out (North East and Cumbria) on BBC1 at 7.30pm on Monday 12 Jan, in an episode which also features a Tyneside surgeon’s dream of building a hospital in India’s slums and a Teesside woman who helped shape modern Iraq. It will also be available on iplayer for 30 days.
Source – Newcastle Evening Chronicle, 12 Jan 2015
Labour leader Ed Miliband is to turn his fire on Newcastle United owner Mike Ashley’s Sports Direct chain, in a major speech attacking “zero hour” contracts.
Mr Miliband will accuse the chain of “Victorian practices” in the way it treats staff.
And he will highlight plans to change the law – so that workers with regular shifts have the legal right to a regular contract, if Labour wins the next election.
It comes as the Labour leader continues his fightback following reports that some MPs had concerns about his leadership of the party.
Earlier this week he delivered a speech pledging to stand up to “vested interests”, to ensure hard work was rewarded and to stamp down on tax avoidance by the very wealthy.
Today he is set to focus particularly on zero hours contracts, in which work is not guaranteed and staff are called in as needed.
Mr Miliband is to say:
“A graphic symbol of what is wrong with the way this country is run is the army of people working on zero-hours contracts with no security while a few people at the top get away with paying zero tax.
“This zero-zero economy shows we live in a deeply unequal, deeply unfair, deeply unjust country run for a few at the top, not for most people. It is a country I am determined to change.”
And he will highlight Sports Direct, which has 400 stores and is estimated to have 17,000 people on zero hours contracts.
“Sports Direct has thousands of its employers on zero-hours contracts, the vast majority of its workforce.
“Sports Direct has predictable turnover, it is a modern company with stores on many high streets and, judging by its success, where many people shop.
“But for too many of its employees, Sports Direct is a bad place to work.
“This is not about exceptional use of zero-hours contracts for short term or seasonal work which some employers and workers may find convenient. This is the way Sports Direct employs the vast majority of its workforce.
“These Victorian practices have no place in the 21st Century.”
Mr Miliband will set out plans to legislate to give employees the legal right to a regular contract if they are working regular hours; to refuse demands that they are available over and above their contracted hours, and to compensation when shifts are cancelled at short notice.
An inquiry commissioned by Labour and conducted by businessman Norman Pickavance, former HR & Communications director at supermarket chain Morrisons, reported earlier this year:
“Sports Direct has expanded dramatically since 2008 and gained a large share of the sports retail market. About 17,000 of their 20,000 strong staff are employed on zero-hours contracts.”
Last month the firm said it would make its employment terms clearer in job adverts for zero-hours posts, following legal action brought by a former employee.
Mr Ashley, an entrepreneur who built up his business from a single sports shop in Maidenhead, bought a majority share in the club in 2007.
Meanwhile, controversial payday lender Wonga has agreed with Newcastle United to remove its logo from all children’s replica shirts and training wear from the 2016/17 season.
Wonga said it followed a review of its marketing launched by new chairman Andy Haste in July to ensure that none of it could inadvertently appeal to the very young or vulnerable.
It has already ended its puppet advertising campaign.
The company said the logo was being removed from children’s kit at the earliest possible opportunity, and that due to kit production schedules this would be from the start of the 2016/17 season – the last season of the current shirt sponsorship deal.
Darryl Bowman, Wonga marketing director said: “As a responsible lender we believe removing our logo from children’s replica shirts and training wear is the right thing to do. We appreciate the club’s support in this matter.”
Newcastle United managing director Lee Charnley said: “We understand and respect Wonga’s position and are happy to support their decision.”
Source – Newcastle Evening Chronicle, 15 Nov 2014
Newcastle United owner Mike Ashley has today been accused of being the biggest employer to use the soon-to-be illegal “zero hour” contracts.
The billionaire’s Sports Direct empire is said to have up to 20,000 part-time staff on the contracts.
But MPs and campaigners say the use of zero hours contracts is “unfair and exploitative,” as workers having no guaranteed working hours and have to seek permission from management to work elsewhere.
A copy of a 2012 contract is reported to tell employees: “If you wish to undertake any work outside the company, whether paid or unpaid, you should raise the matter with your manager … it may be decided that the additional work would conflict with your duties at Sports Direct.com Retail Limited. You would then be prevented from taking it up.”
It is understood this clause remains in current contracts and does not give minimum guaranteed working hours. Campaigners have described the wording as an “exclusivity” clause although it is not known whether Sports Direct enforces the rule.
Labour MP Alison McGovern said: “This seems like ‘exclusivity’ in all but name to me. It is clearly exploitative and really unfair.”
> Alison McGovern is MP for Wirral South. What, no comment from Newcastle’s Labour MPs ?
A spokesman for the Department of Business, Innovation and Skills said zero hours contracts can benefit some workers because of the flexibility but that “unfortunately, it has become clear that some employers abuse this flexibility.”
The Government is seeking to ban such working conditions – which are also reportedly used by companies including McDonalds, Cineworld and Burger King.
Ministers estimate some 125,000 workers will benefit – meaning Sports Direct staff could account for almost one in six of the entire workforce the Government wants to help.
Sports Direct declined to comment.
Source – Newcastle Evening Chronicle, 12 Aug 2014
Labour MPs have increased the pressure on payday lenders Wonga to quit their Newcastle United shirt sponsorship deal – but the company say they are committed to the club.
The finance firm’s new chairman Andy Haste announced on Monday he would be reviewing the company’s advertising and marketing “to make sure that we don’t leave any impression that we are trying to influence or target the very young”.
But with thousands of junior Magpies fans wearing Wonga-sponsored shirts, some MPs said they hope he will end to Wonga’s partnership with NUFC.
A spokesman for Wonga said that its chairman had been asked a comment about Wonga’s marketing in general in the wake of the company’s decision to ditch its “puppet” advertising campaign, and had made no specific remarks regarding Newcastle United.
“We continue to be proud sponsors of Newcastle United FC,” she said. “Our new chairman, Andy Haste, was commenting on our general marketing approach – he did not make any direct comment on our sponsorship of the club.”
Gateshead Mp Ian Mearns said: “If Wonga express an interest in disassociating themselves because of a duty to young fans in their new business model then I’d hope Mike Ashley would let them out of their contract and find a new sponsor.
“But it will depend on what Wonga are contractually obliged to do in terms of the longevity of their sponsorship deal.
“It might be very difficult to extricate themselves from it.”
Newcastle Central MP Chi Onwurah said the possibility of Wonga continuing as sponsor would be in direct contradiction of its vow not to target children.
She said: “The idea that Wonga is not targeting children when its logo is emblazoned across toddlers throughout Tyneside would be laughable were it not so serious,” she said.
“I look forward to a day when Newcastle United’s sponsors are not a source of shame for so many fans, until then I will not be attending matches at the stadium.”
One the issue of the ground re-naming, MPs refused to be drawn.
Wonga paid club owner Mike Ashley to “return” the ground’s name to St James’ Park in October 2012 after he had named it the Sports Direct Arena after his sports shop empire.
But Ms Onwurah refused to be grateful for the move.
She said: “I am not grateful to Wonga for retaining the name St James Park. Mike Ashley should never have changed it to Sports Direct in the first place.”
However, Mr Mearns welcomed the new Wonga chairman’s admission that in the past it has made “some serious mistakes” and his desire for the company to operate in a “responsible and transparent manner.”
“I very much welcomed the comments from Wonga and I think some of that comes from a realisation by them that hopefully there will be much more stringent regulation from the FCA,” he said. “They’re waking up and smelling the coffee and taking a realistic attitude.”
Source – Newcastle Evening Chronicle, 15 July 2014
Zero hours contracts were picked apart by union leaders as part of a round of speeches at the most popular Durham Miners’ Gala since the 1960s.
The historic event, which is now in its 130th year, attracted thousands of people to its Big Meeting event on Saturday and was blessed with fine, sunny weather.
Long-time Labour MP Dennis Skinner warned corporations of using the controversial zero hours arrangements and took aim at Newcastle United owner Mike Ashley, for employing people on that basis through his company Sports Direct.
Christine Blower, general secretary of the National Union of Teachers also spoke, as well as GMB general secretary Paul Kenny and Prison Officers’ Association general secretary Steve Gillan.
Thousands of people lined the streets of Durham as banners from former mining communities were carried past accompanied by the sound of more than 50 brass bands.
The Chopwell Lodge banner with its striking imagery of Karl Marx and former Russian leader Vladimir Lenin caught people’s attention as usual, while several new banners joined the procession this year.
Organisers from the Durham Miners’ Association said it was the most well attended year since the 1960s, despite ongoing financial worries for future galas.
The organisation faces legal bills of £2.2m following a failed six-year compensation battle for its members through the courts.
While £60,000 was found to run this year’s event through a fundraising drive, association chairman Dave Hopper has previously said there may be difficulties beyond 2015.
However he told the crowd: “Don’t worry. We will be back next year and probably the year after.”
Source – Newcastle Journal, 14 July 2014
This article was written by Larry Elliott, economics editor, for The Guardian on Monday 17th March
The scale of Britain’s growing inequality is revealed today by a report from a leading charity showing that the country’s five richest families now own more wealth than the poorest 20% of the population.
Oxfam urged the chancellor George Osborne to use Wednesday’s budget to make a fresh assault on tax avoidance and introduce a living wage in a report highlighting how a handful of the super-rich, headed by the Duke of Westminster, have more money and financial assets than 12.6 million Britons put together.
The development charity, which has opened UK programmes to tackle poverty, said the government should explore the possibility of a wealth tax after revealing how income gains and the benefits of rising asset prices had disproportionately helped those at the top.
Although Labour is seeking to make living standards central to the political debate in the run-up to next year’s general election, Osborne is determined not to abandon the deficit-reduction strategy that has been in place since 2010. But he is likely to announce a fresh crackdown on tax avoidance and measures aimed at overseas owners of high-value London property in order to pay for modest tax cuts for working families.
The early stages of the UK’s most severe post-war recession saw a fall in inequality as the least well-off were shielded by tax credits and benefits. But the trend has been reversed in recent years as a result of falling real wages, the rising cost of food and fuel, and by the exclusion of most poor families from home and share ownership.
In a report, a Tale of Two Britains, Oxfam said the poorest 20% in the UK had wealth totalling £28.1bn – an average of £2,230 each. The latest rich list from Forbes magazine showed that the five top UK entries – the family of the Duke of Westminster, David and Simon Reuben, the Hinduja brothers, the Cadogan family, and Sports Direct retail boss Mike Ashley – between them had property, savings and other assets worth £28.2bn.
The most affluent family in Britain, headed by Major General Gerald Grosvenor, owns 77 hectares (190 acres) of prime real estate in Belgravia, London, and has been a beneficiary of the foreign money flooding in to the capital’s soaring property market in recent years. Oxfam said Grosvenor and his family had more wealth (£7.9bn) than the poorest 10% of the UK population (£7.8bn).
Oxfam’s director of campaigns and policy, Ben Phillips, said: “Britain is becoming a deeply divided nation, with a wealthy elite who are seeing their incomes spiral up, while millions of families are struggling to make ends meet.
“It’s deeply worrying that these extreme levels of wealth inequality exist in Britain today, where just a handful of people have more money than millions struggling to survive on the breadline.”
The UK study follows an Oxfam report earlier this year which found that the wealth of 85 global billionaires is equivalent to that of half the world’s population – or 3.5 billion people. The pope and Barack Obama have made tackling inequality a top priority for 2014, while the International Monetary Fund has warned that the growing divide between the haves and have-nots is leading to slower global growth.
Oxfam said the wealth gap in the UK was becoming more entrenched as a result of the ability of the better off to capture the lion’s share of the proceeds of growth. Since the mid-1990s, the incomes of the top 0.1% have grown by £461 a week or £24,000 a year. By contrast, the bottom 90% have seen a real terms increase of only £2.82 a week or £147 a year.
The charity said the trends in income had been made even more adverse by increases in the cost of living over the past decade. “Since 2003 the majority of the British public (95%) have seen a 12% real terms drop in their disposable income after housing costs, while the richest 5% of the population have seen their disposable income increase.”
Osborne will this week announce details of the government’s new cap on the welfare budget and has indicated that he wants up to £12bn a year cut from the benefits bill in order to limit the impact of future rounds of austerity on Whitehall departments.
Oxfam said that for the first time more working households were in poverty than non-working ones, and predicted that the number of children living below the poverty line could increase by 800,000 by 2020. It said cuts to social security and public services were meshing with falling real incomes and a rising cost of living to create a “deeply damaging situation” in which millions were struggling to get by.
The charity said that starting with this week’s budget, the government should balance its books by raising revenues from those that could afford it – “by clamping down on companies and individuals who avoid paying their fair share of tax and starting to explore greater taxation of extreme wealth”.
The IMF recently released research showing that the ever-greater concentration of wealth and income hindered growth and said redistribution would not just reduce inequality but would be economically beneficial.
“On average, across countries and over time, the things that governments have typically done to redistribute do not seem to have led to bad growth outcomes, unless they were extreme”, the IMF said in a research paper. “And the resulting narrowing of inequality helped support faster and more durable growth, apart from ethical, political or broader social considerations.”
Phillips said: “Increasing inequality is a sign of economic failure rather than success. It’s far from inevitable – a result of political choices that can be reversed. It’s time for our leaders to stand up and be counted on this issue.”
Landed gentry to self-made millionaires
Duke of Westminster (Wealth: £7.9bn)
Gerald Grosvenor and his family owe the bulk of their wealth to owning 77 hectares (190 acres) of Mayfair and Belgravia, adjacent to Buckingham Palace and prime London real estate.
As the value of land rockets in the capital so too does the personal wealth of Grosvenor, formally the sixth Duke of Westminster and one of seven god parents to the new royal baby, Prince George.
The family also own 39,000 hectares in Scotland and 13,000 hectares in Spain, while their privately owned Grosvenor Estate property group has $20bn (£12bn) worth of assets under managemenSpaint including the Liverpool One shopping mall, according to leading US business magazine Forbes.
Reuben brothers (£6.9bn)
Simon and David Reuben made their early money out of metals. Born in India but brought up in London, they started in local scrap metal but branched out into trading tin and aluminium.
Their biggest break was to move into Russia just after the break-up of the Soviet Union, buying up half the country’s aluminium production facilities and befriending Oleg Deripaska, the oligarch associate of Nat Rothschild and Peter Mandelson.
The Reuben brothers are still involved in mining and metals but control a widely diversified business empire that includes property, 850 British pubs, and luxury yacht-maker Kristal Waters. They are also donors to the Conservative party.
Hinduja brothers (£6bn)
Srichand and Gopichand Hinduja co-chair the Hinduja Group, a multinational conglomerate with a presence in 37 countries and businesses ranging from trucks and lubricants to banking and healthcare.
They began their careers working in their father’s textile and trading businesses in Mumbai and Tehran, Iran but soon branched out by buying truck maker, Ashok Leyland from British Leyland and Gulf Oil from Chevron in the 1980s, while establishing banks in Switzerland and India in the 1990s.
The family’s London home is a mansion on Carlton House Terrace, overlooking St James Park and just along fromclose to Buckingham Palace, which is potentially worth £300m. They have links with the Labour party.
Cadogan family (£4bn)
The wealth of the Cadogans family is built on 90 acres36 hectares of property and land in Chelsea and Knightsbridge, west London.
Eton-educated Charles is the eighth Earl of Cadogan and ran the family business, Cadogan Estates, until 2012 when he handed it over to his son Edward, Viscount Chelsea.
Charles, who is a first cousin to the Aga Khan, started in the Coldstream Guards before going into the City.
He was briefly chairman of Chelsea Football Club in the early 1980s and his family motto is: “He who envies is the lesser man.”
Mike Ashley (£3.3bn)
Ashley owns Newcastle United football club and became a billionaire through his Sports Direct discount clothing chain which he started after leaving school.
He was the sole owner of the fast growing business, which snapped up brands such as Dunlop, Slazenger, Karrimor and Lonsdale, until it floated on the stock market in 2007. He now owns 62%.
Ashley is a regular visitor to London’s swankiest casinos but is famously publicity-averse
Source – Welfare News Service, 17 March 2014
A labour peer has come up with a unique way to spend Newcastle United’s money on a greater good.
In the week when the club have pocketed more than £20m from the sale of Yohan Cabaye, former Newcastle Council leader Jeremy Beecham has said owner Mike Ashley should consider making a donation to local food banks.
Lord Beecham has suggested the club might like to consider donating £1 from each matchday ticket sold to local causes, including the food banks popping up across the city.
The peer said it would be a welcome sign from Newcastle United and club sponsor Wonga that they are committed to the city.
He said: “Along with around 50,000 United fans, I’ll be at St James’ Park on Saturday hoping to see United beat Sunderland. Too many people today have to rely on food banks to feed themselves and their families. Food banks rely on the generosity of many individuals and organisations who donate food or cash.
“Wouldn’t it be great if Newcastle United and their sponsors donated just £1 per head out of the ticket income for Saturday’s derby match, in the week when the club receives £25m for Yohan Cabaye? It would be a fraction of the weekly wage bill. I hope on Saturday afternoon we can celebrate a United victory and a generous response from the club to this request.”
Food banks in Tyneside have reported growing demands for their goods, with many now having to make wider appeals for food stuffs. The Newcastle West End Food Bank says it helped provide 10,000 meals last year alone. It has now teamed up with bakers Greggs to help provide more food for hard up families in the city.
Newcastle United did not comment.
Source – Newcastle Evening Chronicle 30 Jan 2014