Published: 11/07/2002, Volume II2, No.5813 Page 19

Have you noticed reports predicting a 'winter of discontent' on the trade union front as low-paid public sector workers flex their industrial muscles in a faint echo of what they did to the last Labour government in 1978-79?

You can be forgiven for not noticing, since many of these dire warnings were tucked away on page 99, as if not even the Daily Beast quite believes that the streets will again be filled with rotting rubbish while the dead remain unburied in hospital mortuaries.

And, yes, I know It is summer, not winter. But, hey, what a cold and wet one.

Are the papers right not to believe it? All we are threatened with at the moment is a 24-hour stoppage next Wednesday, the day Gordon Brown (finally) delivers (probably) his comprehensive spending review to MPs.

It will be in support of a 6 per cent claim, twice what local authority chiefs have offered to a million members of Unison, the GMB and the T&GWU.

And, as with the CSR, where Alan Milburn's extra cash is already safe, the dispute is peripheral to the health service, where most pay deals have been done - including Unison's - and the hot issue remains two-tier employment under the private finance initiative.

All the same, if I were an NHS manager I would be keeping a beady eye on the situation.

Environmental health inspectors, social services, computer systems - all will be affected and that will surely have a knock-on effect for blocked beds and even mortuaries.

But the wider context is clearly different from 1978-79.As with the stock market slump, the fundamentals are much sounder.

We may be in trouble, but we understand it better than we did in 1979, let alone 1929, and we have fewer eggs in one economic basket.

All the same, a couple of points are worth registering - as disappointed unions start cutting back on their contributions to the Labour party and Labour looks increasingly towards state funding of parties, with a cap imposed on individual and corporate/union donations - a kite flown again this week.

One is that the big unions are usually a ballast, supporting moderate Labour leaders, not a threat. The railwaymen's leader, Bob Crow, currently persecuting John Prescott, may be a hard leftist. But Dave Prentis (Unison), Bill Morris (T&GWU) and even dyspeptic John Edmonds (GMB) are mostly level-headed, though the latter two are edging towards retirement.

So the strikes may partly be fuelled by leadership bids as well as dismay at Tony Blair's lack of feeling for the Labour movement's core values. Ever since John Cruddas ceased to be No 10's union schmoozer and became MP for Dagenham, Downing Street has been out of step.Unions feel they may have more influence using saved Labour donations to campaign openly for its causes, like lobbyists Greenpeace or the British Medical Association. Separation may give them more influence, not less.

Last, but not least, remember that the French revolution broke out when things were finally getting better, not worse, for Louis XVI's poor subjects.Hope breeds boldness; it is as true in 2002 when extra money is reaching hospital and town hall. 'Blair and Prescott should tell the councils to raise their offer to 3.5 per cent and promise a serious review of low pay, which is a real problem, ' a shrewd union chum says.

In his speech to the human resources in NHS conference last week, Mr Milburn said: 'NHS staff deserve fair pay.There is no argument about that. But what I am not prepared to do is to see the large increases in funding for the NHS all go on extra pay.

There has to be responsibility in public sector pay, including in the NHS. So I am prepared to invest more, but only in exchange for getting more.'

That is the significance of the minister's reference to the Agenda for Change 'final phase'of the current NHS staff talks, designed to attach flexible pay to flexible working. 'It will mean an NHS where staff are paid according to the work they do, not the job title they hold... We need a system which makes sure people are paid for what they do and encourages them to progress, 'Mr Milburn said, before appealing for union help to manage such vital change.

It is what the Blairite modernisers have been working for. But It is very tricky.