Quantcast
Channel: CIVITAS » blair
Viewing all articles
Browse latest Browse all 5

The ‘party of working people’ should increase the minimum wage

0
0

If this government is vulnerable to any charge it is that economic recovery has benefited few people. Wage rises are still below inflation and job creation has been largely inflated by temporary, low paid work – jobs in low-paying sectors rose at twice the rate of overall job growth in 2012. Having wedded itself to deficit – or welfare – reduction the Coalition has left itself with few options to alleviate the pains of economic reconfiguration. Labour’s campaign on the cost of living issue (‘crisis’ has lost its meaning in politics) is working, especially in terms of energy costs

As has been widely observed, raising the minimum wage would be both politically astute and, on the balance of things, affordable. Aside from putting a few more pennies in the pocket of consumers, it would also be a clear cut message that Conservatives are not deaf to the plight of low-income earners.

There are other reasons too: the UK has, according to the OECD (p.57 onwards), one of the most unequal distributions of income in Europe. Before Christmas, Boris Johnson, among others, claimed there should be more gratitude to the top 1% of taxpayers, who are now paying almost 30% of all income tax. But when wages have stagnated and more people have had to been taken out of tax altogether, it is little wonder the burden has increasingly shifted.

Naturally, there are very valid concerns about even a small raise at this juncture. Recovery, in the narrow sense it can be called such, remains fragile and raising the minimum wage too high will affect inflation and employment; headline unemployment rates have been one of the government’s favoured success stories. But Cameron and Osborne have also placed considerable effort into positioning themselves as the ‘party for working people’. Making sure those working people are properly remunerated will give far more substance to the claim. Indeed, Iain Duncan Smith is rumoured to be among the biggest proponents of the raise, believing it will cut back the benefits bill for people in work. George Osborne has recently announced there will be another round of cuts in amount of £25 billion, with the DWP again taking the biggest hit. An increase in the minimum wage would be a wise trade-off for any raid on tax credits the Chancellor may be planning.

Conservative back benchers have also expressed rather a lot of support for such a move. When Labour originally introduced the minimum wage in 1999, it was in the face of tense Conservative opposition caused by a fear (now proved misplaced) that any minimum wage requirement would adversely affect businesses. Many Conservatives believe they have, politically, never quite recovered from this.

Raising the minimum wage would be a Clause IV moment for the Tories, a chance to do something uncharacteristic and even centrist. It would be in the same tradition as Thatcher sanctioning the distribution of clean needles for drug addicts, or Blair and Brown giving independence to the Bank of England.


Viewing all articles
Browse latest Browse all 5

Latest Images

Trending Articles





Latest Images