More Boulton bumble

Provided we bear in mind “news” amounts to no more than an edited version of as much “truth” as they feel we need to be told, we can’t go far wrong. Just keep digging for more.

And nowhere more so in the Murdochian edits of what might be in the “public domain”.

Which brings me to Adam Boulton’s Sunday Times slot. This week cozying up to the clichéd Elephant in the Room:

Not satisfied with eliminating the budget deficit, Osborne is bent on re-engineering Britain as a high-pay, low-welfare, low-tax economy. To this end, he is calling the shots on cutting tax credits. As a result the new government faces the biggest crisis of its short life.

My main gripe there is the “high-pay” thing. Evidence needed, Mr Boulton.

The official plaster-of-Paris fig-leaf applied to the offence is the (wait for it!) “national living wage“:

… a new, compulsory living wage from April 2016.

It will be paid to workers aged 25 and above. Initially, it will be set at £7.20 an hour, with a target of it reaching more than £9 an hour by 2020. Part-time and full-time workers will get it.

It will give a pay rise to six million workers but is expected to cost 60,000 jobs and reduce hours worked by four million a week, according to the Office for Budget Responsibility.

On paper it looks too-good-to-be-true:

_84182518_minimum_wage_gra_1_624

Note the weasel-word: “forecast”. Note, too the wide variation of what it might mean. And — since we live in an age of recognising the cost-of-everything, but the value-of-nothing (especially the value of words, promises, pledges, aspirations, whatever) — what imposts it lays on employers. It should also lay a burden on government, to ensure it delivers, and on that ground, one has one’s doubts:

The National Living Wage’s introduction could mean an increase in black market payments to workers, a hospitality industry spokesman has said. 

Many employers will have to increase salaries when the new £7.20 an hour measure comes into effect next April.

Colin Neill of Hospitality Ulster said it would have major implications for hotels and restaurants.

He told the BBC’s Inside Business programme there was a risk of more workers being paid “cash-in-hand”. 

Mr Neill said that while the hospitality industry was “in a much more difficult place than others”, various sectors were looking at “how we’re going to deal with this and, actually, how can you pass on the cost”.

To clarify: there are just two ways of “passing on the cost” —

  • billing the customer and end-user,
  • or diddling the employees, cooking the books, and by-passing any charges and taxes on employment (especially, social security payments).

Are we all sure:

  • the latter won’t happen?
  • or that official inspection will be adequate to sort out the rogue employers?

But, where I’m sitting (quite comfortably, thank you for asking), that’s not the Bigger Picture.

What that glossy incremental line-graph, an ever increasing basic pay-packet, ignores is the way it will primarily mean no more than absorbing the next wage-bracket above minimum into the “national living wage”. In theory, and on paper, the employee currently just above the £7:20 per hour rate should see a proportionate increase — so the current £9 per hour wage should rise by 25% by 2020 (say to £11:20 per hour), to match the increase in minimum.

Better believe it!

For, unless there is real pressure from the employees, that simply will not happen. Fair dos, there may be nugatory increases. But, without proper trade union pressures — precisely the thing this government is dead-set to eliminate — there won’t be justice done.

Which has other implications.

Especially for productivity, which is where — for the last decade — we have catastrophically failed.

Oh, and haven’t we heard of Adam Boulton’s high-pay, low-welfare, low-tax economy somewhere before? Something along these lines:

In bringing about economic recovery, we should all be on the same side. Government and public, management and unions, employers and employees, all have a common interest in raising productivity and profits, thus increasing investment and employment, and improving real living standards for everyone in a high-productivity, high-wage, low-tax economy

Now where was that? Ah, yes! The Conservative manifesto, foreward by Margaret Thatcher, for the 1979 General Election.

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Filed under Conservative Party policy., History, Sunday Times, Tories., Trade unions

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