The Stage

Equity faces subscriptions rise or redundancies

Published Tuesday 10 February 2004 at 12:15 by Ruth Gillespie

Equity staff are facing job losses unless subscriptions are increased by almost a third over the next two years, honorary treasurer Bryn Evans has warned.

In the week that the Equity Review of the Year - containing the audited 2003 accounts - has been distributed to members, Evans described the plan to raise the annual minimum subscription as the “least worst solution” to the current crisis. He predicted that the union’s deficit of £171,873 could be cleared by December 2006 if the measure was introduced.

He said: “Basically our outgoings are not matching our earnings. We have had a deficit for some years and the auditors have told us we need to address the problem within a reasonable time. To do this we have got to either increase our income or cut expenditure - it’s that simple.”

The proposal to hike up membership fees from £66 a year to £80 by July 1, 2004, rising to £90 by 2005, will be put to the annual conference in May.

“It will be a difficult debate and it is my job to persuade members,” said Evans, whose election to the post of honorary treasurer was announced on February 3. “If it is turned down we would have to look at cuts to services and redundancies. As a union we are not obliged to offer these services for free but we feel it is our role and it is one of the reasons people join. We don’t want to reduce staff, it would be a disaster, but 60% of general funds goes to staff salaries and related costs.”

Equity celebrated its first profitable year for a decade in 1999, which coincided with the final stage of Action 2000, a controversial three-year reform package designed to stabilise the union’s financial situation. However, critics of the initiative claimed the turnaround in 1999 had been created by offsetting the organisation’s losses with a lump sum from the collective funds - royalty payments that cannot easily be distributed to individual members - although this has been denied by Equity officials. By 2000 the trading account had once again slipped into the red and the deficit has been escalating rapidly ever since.

In 2003, £71,291 of collective funds was also transferred into the general accounts. However, even with this extra money, losses have risen by almost £42,000.

Spokesman Martin Brown has blamed a fall in bank interest earnings - from £272,874 in 2000 to £133,813 in 2003 - for the organisation’s failure to secure a balanced budget.

He said: “Income from bank investments has more than halved since 2000 and this is a key element contributing to the present state of our accounts. Action 2000 hinged on what could be reasonably predicted as likely stockmarket trends and if interest rates had remained the same as they were at the beginning of 2000 we would be in the black. But the downturn caused by September 11 means that our deficit is almost identical to our losses in capital funds earnings.”

Equity variety councillor Dave Eager has dismissed the claim as irrelevant to the union’s core problem of failing to bring in enough income from subscriptions to pay for member services.

“Of course bank interest has dropped,” he said. “But if Equity was a successful organisation, income from subscriptions alone would fund the core running of the union. We have to ask whether we are providing the services that potential members are looking for because if we were they wouldn’t be leaving and we wouldn’t need to invest in recruitment and retention schemes.

“The people running Equity have regarded it, since 1994, as a trade union first and foremost. They treat members like ordinary citizens but we are not ordinary when it comes to employment issues. To raise subscriptions is a quick fix, a lame solution which isn’t appropriate for the situation. They say that £80 is still low compared to other unions but where is the value for money for someone who might be out of work for 80% of the year? Equity has lost the credibility of being a professional association.”