'Axe' public sector union rights, say business leaders

Teachers on strike
Image caption The IoD wants to curb the rights of union members

Business organisation the Institute of Directors (IoD) has called for collective bargaining to be scrapped for teachers and NHS staff.

They are among a set of proposals the trades unions have described as a "Thatcherite fantasy world".

The IoD put a series of recommendations to government to cut red tape and boost private sector growth.

It also wants an automatic right to ask for flexible working to be removed, in order to increase productivity.

The IoD has put forward 24 "freebie" proposals, which it says would cost the government nothing but would benefit growth, particularly in the private sector.

Among the most controversial would be the call to curb trade union negotiating power in large public sector bodies, said BBC business correspondent Joe Lynam.

The IoD also suggests that workers should pay a deposit of £500 when taking their employers to industrial tribunals to deter what it describes as "vexatious claims".

A spokesman for the Trades Union Congress said the IoD's real aim was to make life easy for directors at the expense of their workforce and to lower pay and conditions in the NHS.

Fifty-eight unions are members of the TUC, representing nearly 6.5m members.

The government was recently criticised by Sir Richard Lambert, the outgoing boss of business body the CBI, for making cutbacks but not setting out its vision to promote growth.

But the Treasury said its deficit reduction strategy was "central to growth".

The IoD has said both employment and planning laws should be overhauled in favour of companies to kickstart the economy.

This should include revolutionising the planning system to open up the greenbelt to developers, it said.

Miles Templeman, director general of the IoD, agreed the government was aiming to improve growth prospects and the "overall business environment", but said it needed to "reform the supply-side of the economy to boost the private sector".

Image caption Greg Clark said proposed new planning laws were "unashamedly pro-growth"

"Many of the measures we have proposed today are long overdue and would improve the UK's infrastructure and the functioning of its labour market. We urge ministers to seize this opportunity."

The paper suggests the government should drop plans to abolish the default retirement age, asking "Why does the government want to make it harder to remove staff who are no longer effective?".

Collective pay bargaining in the NHS and education sector should also be ended to boost productivity, the IoD has said.

And in addition to abolishing the right to request flexible working it has proposed scrapping the right to request time off for training - both of which it claims creates red tape for firms.

But TUC general secretary Brendan Barber said the IoD plans would not generate growth.

"Our economy is not struggling because of the relatively modest platform of rights people have at work," he told BBC Radio 4's Today programme.

"Taking these away and taking away collective bargaining from the NHS, that would do nothing to generate growth.

"We need decent fair pay systems, and collective bargaining is the way to deliver that."

'New model'

In planning, a fast-track system for key national infrastructure projects should be created that could over-ride local objections, said the IoD.

But decentralisation minister Greg Clark said the government's recently-published Localism Bill was "unashamedly pro-growth".

"It will reboot the planning system so it is no longer one of the major obstacles to growth. We have got into a disastrous situation where communities have become pitted against development by being shut out of the process and seeing only the costs, never the benefits," he said.

The IoD paper also suggests that the ratio of public spending to GDP should be reduced to 35% by 2020. The government is planning to get spending down to 40% by 2016.

A spokesman for the Treasury said: "We are glad the IoD has agreed that our deficit reduction strategy is central to growth.

"We have been clear that the Budget will build on work we have done already as we move towards a new model of economic growth."

The Treasury said survey data had last week showed record manufacturing growth in January, and that growth in services and construction had exceeded expectations.

"This points to a rebalancing of the economy - that is vital if we are to achieve sustainable economic growth."

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