Medway’s resistance to an unjust transition.
Down the canyon of Chatham High Street comes the march. Banner of Medway Trades Council proudly to the fore. Chants and shouts echoing off the shopfronts and the buildings above. “Enough is Enough! Enough is Enough!”
Past the pound shops and the charity shops. Past the boarded up windows and the off licenses. Through the battered heart of Chatham. “Tories! Tories! Tories! Out! Out! Out!”
The march, perhaps 150 strong, has made its way two miles from Gillingham. It turns onto the open ground of The Paddock and the rally begins.
Mic in hand, RMT branch secretary Ivor Riddell, bellows at the crowd with a cheeky smile. Shouting “Enough is Enough!” Back comes the defiant response “Enough is Enough!”
There are banners and organisers here from the trade unions – the RMT and CWU – railway staff, BT workers, Posties. There’s a message of solidarity from the train drivers – ASLEF. Later the crowd is addressed by Labour MP Barry Gardiner and Vince Maple, leader of the Labour & Co-Op Group on Medway Council.
This demonstration is part of a co-ordinated wave of similar actions in over 50 cities across the UK, in Glasgow, Edinburgh, Luton, Plymouth, Brighton, Norwich, Liverpool, even Ramsgate. The main event is in London where a crowd of around 10,000 gathered outside Kings Cross Station to hear speakers such a Mick Lynch, General Secretary of the RMT.
As those that take the mic at the heart of Medway spell out, the Enough is Enough! campaign has five demands to tackle the Cost of Living Crisis:
- Slash energy bills
- A real pay rise
- End food poverty
- Decent homes for all
- Tax the rich
The march and rally in Medway is smaller than hoped. It seems the truly dedicated and organisers from the major unions and the local branch of the Labour Party are here. But it is a significant event – a show of strength in a town that seems to rarely show its muscle.
It reminds me of demonstrations in the 1980s. And the closer I look at the days we are going through now, the more they bear instructive comparison to that decade.
Much has been made of (now former) Prime Minister Liz Truss’s evocation of Margaret Thatcher. In dress sense, in iconic photo opportunities and in her attempt to show resolute determination. Trying to emulate the spirit of ‘The Lady’s not for turning.’ And many spoke of (now former) Chancellor Kwasi Kwarteng’s ‘mini-budget’ as being an echo of the 1980s – tax cuts for the very wealthy, and welfare spending slashed further. Many of the ideas behind what became know as Thatcherism arose from the work of ‘think-tanks’ such as the Institute of Economic Affairs, whose policies were nurtured and financially assisted by the likes of Peter Walters, Chairman of BP – as we explored in our book Crude Britannia. The same think tanks are behind ‘Trussonomics’ fifty years later.
But the dissimilarities with the 1980s are clear too. Not just in Truss and Kwarteng’s now infamous U-Turns, and subsequent downfalls, nor in the degree that the Conservative MPs and Truss’s Cabinet itself are so clearly riven by factions.
Deeper than this, when the Conservatives won the 1979 General Election they did so with a landslide. Thatcher had the mandate of a majority of 44 seats and 13.7 million votes from the entire British electorate. Truss had no such mandate, having gained her position on the back of 57.4% of Tory Party members – a mere 81,326 votes. (Rishi Sunak has been chosen by around 200 MPs out of a potential 365.) Truss came to power after 12 years of the Conservatives having been in government. Thatcher came to power after five years of Labour rule and the infamous ‘Winter of Discontent.’
And the shape of the economy is utterly different. The Conservatives in 1979 had a huge base of state owned assets to sell, in particular in the energy sector – from the CEGB (the monopoly electricity generator), to British Gas and BNOC (the state oil & gas company). The sale of these corporations brought the state an income of billions. Alongside this, North Sea oil & gas production was rapidly coming on stream and the level of revenue to the Exchequer was steadily rising. Much of the radical social and political change instituted by the Conservative government was enabled by finance from oil & gas assets. As has been said from many quarters, Thatcherism may well have been impossible without North Sea oil.
Nothing like that exists now. There are precious few state owned assets for the government to sell – certainly none in the energy sector. Production of oil in the North Sea is a fraction of what it was, and the tax revenues from this oil are negligible. Indeed the state is underpinning production with subsidies rather than reaping revenue. A state of affairs brilliantly explored by Uplift.
If part of what made Thatcherism possible was money from North Sea oil, then perhaps part of what made Trussonomics impossible was a lack of money from North Sea oil?
What of the relationship between the oil & gas sector and the Truss government’s Libertarian turn? The CEO of Shell, Ben van Beurden, gained some media coverage from his comments that appeared to criticise the Prime Minister and Chancellor’s move to cut taxes on the wealthiest.
Speaking at the Energy Intelligence Forum in London on 4th October he said:
“One way or another, there needs to be government intervention… that somehow results in protecting the poorest. And that probably means governments need to tax people in this room [of energy company executives] to pay for it – I think we just have to accept [that] as a societal reality.”
And van Beurden foresaw rising energy prices and volatility saying:
“You cannot have a market that behaves in such a way … that is going to damage a significant part of society”
Such a direct and public intervention by a head of an oil corporation in UK domestic politics is rare. So why now? Why did Shell choose to speak out at this point?
It is instructive to look at how the oil & gas corporations might have been impacted by the Truss government’s intention to reduce taxes on the wealthiest while cutting spending on welfare and – at best – freezing them on education and the NHS. We can almost be guaranteed that all of those in the Energy Intelligence Forum gathering van Beurden spoke to were above the much talked of £155,000 per annum wage level and so stood to benefit from the tax cuts. (Van Beurden’s salary in 2021 was £6 million. He and Bernard Looney, CEO of BP, were set to save a combined £640,000 from the planned tax cuts, as revealed by Global Witness.)
Whereas in the 1980s BP and Shell (in a joint venture with Exxon) were the dominant players in the UK North Sea, they are very much smaller today. Shell sold many of its assets to Harbour Energy (now the UK’s largest producer) and BP represented less than 9% of the UK’s oil production in 2020. BP has larger assets in Azerbaijan, Mauritania and Senegal than in the UK.
Shell, BP and all the smaller corporations extracting oil or gas offshore have very few directly employed staff in the UK, and therefore these companies are cushioned from the impacts of decline in the condition of the UK’s health service and social provision.
Van Beurden’s concern about the impact of price hikes on UK citizens might seem self-serving and be driven by a concern that gas consumption or petrol sales to business and households will impact on Shell’s sales and profits. But the scale of Shell’s gas sales – both wholesale and retail – into the UK market is a fraction of its global sales. The same can be said of petrol. Despite there being 1,100 branded Shell service stations in the UK, the vast majority are not company-owned and the fuel they sell is mostly not delivered or even refined by Shell. Thus the rising prices of petrol at the pump, due to inflation or the collapse in the value of the pound, will not impact Shell.
The key value of the UK to Shell and BP today is as a place of oil trading. The site of their wealth extraction in the UK is not on the forecourt, nor the household gas bill, nor the refinery or the offshore platform, but in the City of London. If Azerbaijan, Angola or the Gulf of Mexico are oil & gas production nodes in the global production networks of BP and Shell, then London is a finance and trading node alongside New York and Singapore.
The Chancellor’s mini-budget on 23rd September was derided in the press as ‘a bankers budget’ in that it was set to reward those working in finance. (Indeed, although there has been a U-turn on the 45p tax rate, to date the new Chancellor Jeremy Hunt has not lifted the limits on ‘bankers bonuses’.)
If the mini-budget (and most likely whatever replaces it with on 31st October) aimed to reward those working in finance and encourage the growth of the finance sector (or at least defend it in a ‘Post-Brexit World’), then this will place greater emphasis on financial trading in the UK economy. And this is a direction of travel that neatly coincides with the priorities and desires of the likes of BP & Shell when they look to the UK.
And this direction of travel brings us back to the 1980s. For it was in that decade, especially though the abolition of exchange controls in October 1979 and the removal of structures of finance in The City through ‘Big Bang’ in October 1986, that arguably kept London as a global finance hub. The City changed, but it maintained (and reinforced) its dominant position in the UK’s economy. Elsewhere in Britain, regions changed, but have never recovered.
Those shifts are graphically demonstrated in the Thames Estuary and particularly in the area around the Medway. When the Thatcher Government came to power, 16,000 worked in Chatham Royal Navy Dockyards. It was a massive industrial complex underpinned by oil. Indeed the complex included both a terminal for North Sea gas and an oil refinery – the BP Kent Refinery on the Isle of Grain. This plant’s large workforce lived in the towns and villages on the Hoo Peninsula and in Medway. They were part of the great army of staff across Britain working directly for BP, as well as Shell and other oil & gas companies, whose livelihoods were underpinned by the UK’s welfare state, its schools and hospitals, its unemployment benefits and elderly care.
On 25th June 1981, barely two years after the Conservatives came to power, news was leaked that Chatham Docks would be shut. Eleven days later 4,000 dockworkers were joined by thousands of residents from Medway Towns in a demonstration against the planned closure. But the process of deindustrialisation was not halted. Perhaps the most significant foundation stone to go was BP’s Kent Refinery, shut down on August 27th 1982 by the then Chairman of BP, Peter Walters. Soon after the rest of the industrial edifice of Medway crumbled. The Docks were closed in 1984.
The rapid change was a huge blow to the regional economy – industry was leaving the area behind. And it has still not recovered. Medway Towns, with a population of 270,000 currently has 8 food banks. Medway was listed as the 93rd most deprived local authority in England out of 317. And it has fourteen neighbourhoods ranked among the 10% most deprived neighbourhoods across the country.
These are statistics gathered in 2018, long before the current Cost of Living Crisis, so the situation is undoubtedly worse today. No wonder there are calls that Enough is Enough!
There is a particularly bitter twist in the fact that households that once had family members who worked in refinery now struggle to pay energy bills. For so many in Medway, things have gone backwards since the days of the dockyards.
In 2017 we talked to former workers at the Coryton Refinery, across the Thames Estuary in Essex, who remembered the Grain Refinery flare on the horizon being doused over thirty years previously and the shock wave that it sent through the region. More than a generation has been living with the impacts of an unjust transition.
Can we imagine that the call of Enough is Enough! is not only an act of resistance to cuts and the radical fall in the value of real wages, but also part of a step out of several decades of economic decline?
Thanks to Kolya Abramsky, Lena Šimić, Terry Macalister and Annie Brooker