By Ryan Gallagher
Bank of England governor Mervyn King has today warned that unions must accept public sector cuts, or else jeopardise economic recovery and fail the next generation.
Speaking at the annual Trade Union Congress at Manchester’s Central Convention Centre, King acknowledged that the financial sector had indeed “let it slip”.
However he told delegates that reform of the banking system alone would not clear the current budget deficit.
“We need to do more than reform our banking system,” King said. “We need a higher national saving rate, and a shift in spending and production away from consumption towards exports.
“We owe it to the next generation to seize this opportunity to put in place the reforms that will make another crisis much less likely and much less damaging.”
Appealing for the full support of the unions, King emphasised the importance of the Bank of England and the trade union movement working together – but not all delegates were convinced.
Bob Crow, general secretary of the Rail and Maritime Union (RMT), staged a walk-out as King took to the stage, while many others raised placards bearing the words ‘No Con-Dem Cuts’.
A handful of delegates also staged a stand-up protest as King began his speech, wearing t-shirts that read ‘make the bankers pay’ and ‘save our services’.
RMT spokesman Geoff Martin said: “RMT delegates would prefer to hear from the people suffering from the cuts and the economic crisis rather than sitting in a hall listening to one of the people who created the financial chaos.”
However, King was met with a lukewarm applause as his speech reached its conclusion.
“It will require patience and determination on all our parts, including your members”, King told the delegates.
“But the prize of restoring and maintaining economic stability – and a return to sustained rises in employment and living standards – will be worth the effort.”