Take stock of realities

There has been a similar development in the private sector, where the incomes of those at the base barely keep pace with inflation while those in the boardrooms have huge bonuses and pensions contributions set by remuneration committees on a "you scratch my back, I'll scratch yours" basis.

Both sectors evince an almost mystical belief in the ability of top executives to revolutionise corporate or local authority financial fortunes.

Amazingly, there is near unanimity over the measures to be taken - cut costs by outsourcing, redundancies and holding down surviving workers' pay, increase revenue by pushing up prices and council tax to whatever the situation will bear and then celebrate by rewarding those at the top for their bold initiatives.

Labour is not alone in championing this economic three-card trick, but it is a relatively recent convert.

At one time, its concept of local government was to provide a range of local services that were intended to make life more tolerable in a society divided by inequality.

But, in its adoption of neoliberalism, it has jumped on board the Tory bandwagon of efficiency and value for money, which, contrary to real-life experience, can only be validated by the amount of private profit generated.

In this way, while Labour correctly opposed the Tory trend in the 1980s of putting out all council services to private bidding through its compulsory competitive tendering process, it has, in government, taken up such policies with enthusiasm.

In short, it has rejected its previous respect for the public-service ethos, substituting the capitalist dog-eat-dog belief that society is based on selfishness, with everyone out for themselves and to hell with collective efforts to improve life for all.

Or, as Tory prime minister Margaret Thatcher put it, that there was no such thing as society.

Her government's hostility to the collectivism that took hold in much of Europe in the wake of the second world war and gave rise to welfare states and publicly owned and administered health services was directed at smashing these institutions.

Mrs Thatcher's historical legacy is that her ideas are now espoused not only by her own party but also by Tony Blair and Gordon Brown and their shameless followers in new Labour.

The fact that both of these betrayers of all that Labour has ever stood for not only invited Mrs Thatcher to 10 Downing Street but backed a state funeral for her when she dies must rankle with all those labour movement activists who battled against her single-minded attacks on the working class.

Public-service union UNISON is right to contrast the glaring injustice highlighted by the Audit Commission.

But the issue goes beyond simply pay. Social injustice is becoming institutionalised, with private-sector penetration of our NHS and public services eroding all of working people's post-war social gains.

The labour movement has to take stock of current realities and organise to rebuild the political consciousness that fuelled the successful campaign for public ownership, public services and social progress after World War II.