The facts

Yesterday a leading official of the Communication Workers Union, the suicide union, claimed that his members needed a significant pay increase because "the public sector unions have lost ground over the last year or two."

Perhaps his union has, but in general as wages fell in the private sector and jobs disappeared wages in the public sector generally rose slightly and numbers of employed increased.

The National Statistics Office recently reported that pay settlements in the public sector over the three months to August 2009 rose at annual rates of 3.4%, while those in the private sector rose at 1.5%. Given that inflation on the RPI now has a negative rate of -1.4, those rates are effectively 4.8% and 2.9%, some people somewhere are doing very nicely, and the public sector is doing rather better, even if we are in recession. (It should be remembered that public sector pensions are mostly final salary and indexed, whereas these are becoming rare in the private sector.)

The spokesman for the postmen should be a little more careful. But just a minute, I thought that the impending strikes were about the nasty bosses imposing unfair demands on our "posties". How did pay get into this?

The bosses may have been beastly, - it is difficult to tell, but what is clear is that customers have been deserting Royal Mail in droves for years, because of cost and unreliability and growing alternatives. Royal Mail have made significant losses, and the pension fund has an enormous hole in it. If a strike takes place, especially if it seriously disrupts the pre-Christmas deliveries, then we may be looking either at privatisation or serious down-sizing and job losses. If it is privatisation, no buyer would consider buying the sclerotic organisation without prior agreement on working practices and/or job losses.

What the union is doing in its short-sighted stance is making down-sizing and job losses almost inevitable.