January 17th, 2014

Top Wonks Slam Osborne’s Minimum Wage Rise

Osborne ruining Ed’s big day by calling for a rise in the minimum wage is politically cunning, though it remains a fundamentally unsound economic idea. Here is a round up of how some of the more sensible think tanks responded to the idea of an increase to £7-an-hour:

Adam Smith Institute “A minimum wage increase will hurt the poor, particularly young people and vulnerable groups like migrant workers. Most of the empirical economic evidence has found that increases in the minimum wage cause increases in unemployment. Even if the immediate impact is not large, this increase will lead to a long-run decline in job creation and standards for Britain’s poorest workers. It will hurt the very people it is supposed to help.”

Institute of Economic Affairs“This move would not only jeopardise the jobs of some of the most vulnerable workers in the country, it will make it even harder for the young and out of work to get a foot on the employment ladder. If an employer cannot afford to hire someone because the minimum wage is too high, then someone who otherwise could have found work remains unemployed. The minimum wage is a blunt instrument. Increasing it will damage both business growth and society’s most vulnerable.”

Centre for Policy Studies – “Those who suffer most from a rise are the unskilled and young, who have low productivity and get priced out of the market – denying them the chance to accumulate “on the job” human capital. Higher minimum wages make it less profitable for firms to take on untested employees. This may be one reason why youth unemployment and unpaid internships became more common, even in a healthy pre-crisis jobs market.”

Still, you’d need a heart of stone not to enjoy Labour’s squirming this morning…


227 Comments

  1. 1
    RED ED - SON OF BROWN says:

    I will restructure the Banks and put Fred Goodwin bank in charge of the largest.

    Like

    • 4
      Ed Balls - Shallow Chancer says:

      Can you also appoint the Reverend Flowers, Governor of the Bank of England ?

      Like

    • 5
      Steve Miliband says:

      Rev Flowers can take over RBS

      Like

    • 25
      sniffer says:

      The (Socialist) Labour Party would have us believe that the National Socialist Party (Nazis) were in fact not Socialists.

      hmmmm……….smell like more left wing propaganda

      Like

      • 201
        I hate socialists. says:

        Some of the bile and hate that the socialist Labour party spew
        would have made Hitler proud.

        Like

    • 30
      Tony E says:

      Actually, the CPC and others might have this wrong.

      Most of the economic migrants who come here are over the age of 21 – so therefore they compete unfairly with our own youth who lack experience. Raising the minimum wage for over 21s starts to give a greater disparity between the wage that must be paid to a migrant worker compared to our own 18 year old school leavers.

      Anything that helps to recapture the school leaver’s place in the jobs market could be much better in the long run than simply depressing wage rises.

      Like

    • 40
      genghiz the kahn says:

      Like

      • 86
        Casual Observer 5 says:

        Cue Melvyn Bragg…

        Like

        • 212
          broderick crawford says:

          There s been an epidemic of finger pointing by the Labour side this week starting with the lengthy fingerpoint launched at PMQ s by an Eagle s talon .

          Now Ed Mill and Chukka are pointing at each
          other through cyberspace .

          Are they both saying “He s the bounder who claims to be me !!” ??

          Like

    • 97
      Anonymous says:

      I’d rather have Fred West !

      Like

  2. 2
    Ah! Yes says:

    If DLT had been a Liberal Lord, he would be sleeping somewhat easier.

    Like

  3. 3
    Cupertino says:

    What harm comes to Osborne if the commission award a lower amount? The real question is how does this speech stack up with last week’s one about the risks of too high an award.

    Like

    • 12
      Cappuchino says:

      It’s all froth.

      Like

    • 17
      Mr Potato Head says:

      Osborne and the Tories are socialists.

      Like

    • 33
      B Boyd says:

      Increase to around £7 (to help get into power next election) then freeze for 4 years while in power (leaving 1 year to announce another rise before the election after.)

      Bunch of monkeys

      Like

    • 37
      Osbourne likes cocaine and black whores, so I'm not really interested what the little shit thinks says:

      It’s utter nonsense that paying real wages causes a loss of jobs. It’s not a job if the employee has to work 40 hrs and still claim benefits, it’s workfare slightly subsidised by the employer. What big business is worried about is less for them and more for the workers. The whole business model, which dictates that piss-poor wages enables cheap pricing, is totally faulty. The workers should be paid fairly, the products should be priced accordingly and profits should reined in.

      Shit-kickers like Tesco’s are shafting farmers senseless, paying them next to nothing, so they can sell the produce for next to nothing, paying their own workers next to nothing (induction as a new employee at Tescos includes training sessions on how to claim in-work benefits) and then whine when they ONLY make 400 million instead of 500 million. Massive corporations have far too much power, operate as duopolys, control and subvert councils, in particular their planning depts, and should be forced to pay a percentage of profit as wages, else be taxed the same amount plus penalty. They should also be restricted to 100 stores each.

      Oh, employment taxes are too high, if they should even exist at all. Wankers like Osbourne should do something about them before pissing about with 70 pence an hour wage increases.

      Like

  4. 6
    Anonymous says:

    Increase the wage, reduce the benefits………..sound strategy.
    Ensure work pays more than skivving.

    Like

    • 16
      A Man From Slough says:

      Maybe. But the danger is that this would hurt the very people it is trumpeted as helping: if your labour isn’t worth £7 an hour to a company and you’re not allowed to work for less, what do you do when your benefits are cut?

      Like

      • 41
        Funny how those not on minimum wage think it's great says:

        HTF can any man’s labour be worth less than 7 quid an hour?

        Like

        • 62
          Taxpayer says:

          When it is taking pace behind a desk in Whitehall, a local authority or guango. There are many, many examples of people whose work is worth less than seven pounds an hour. In fact, such people cost the country billions

          Like

        • 87
          Lif says:

          When you’ve got 5 million un-qualified, un-skilled immigrants chasing the same job, the job goes to the one that accepts the lowest wage.

          Did you really need to ask?

          Like

        • 89
          Arthur says:

          Simple if his value add to any production / service process is worth less than £7 to the employer.

          Like

          • Funny how those not on minimum wage think it's great says:

            The only way that is possible is if he is not able to cover his wages and make a profit. Do you really think that Tescos make less than 8 quid per man per hour after other expenses?

            I can see you are not on 7 quid an hour.

            Like

      • 106
        FFS says:

        Firstly, given that you can barely afford to support yourself on a minimum wage let along a family, how can it possibly be reasonable to charge as little as £7 per hour?

        There is a belief that much of these jobs are aimed at ladies for “pin money” but why does that allow employers to pay piss poor wages?

        If the taxpayer is merely making up the piss poor wages with tax credits to the tune of £10,000 a year who is being subsidised exactly? The employee or the employer?

        What about companies like Starbucks? They pay no corporation tax because they artificially increase the costs of their own internal coffee supplies to ridiculousa levels and all their employees are on minimum wage so they pay almost no tax. What is the purpose of allowing these American companies to come here and make money out of us when the taxpayer is subsidising it?

        Sainsbury’s costs would go up by about £100m per year, so their profit would decline by about 15%. In reality the supermarkets would all be impacted in the same way so they will simply pass the cost onto the consumer, but it is still more logical to reward work correctly than have a system of taxpyer subsidy – problem is, of course, that the consumer will be paying more in the stores and still paying for tax credits!

        The fact is the entire employment market is now so distorted by tax credits and so many other subsidies (effectively subsidies to unscrupulous emplyers) that we have absolutely no idea which jobs are genuinely worthwhile and which are not. How many people, for instance, would have their car washed by a valet if they had to pay the FULL costs of that person, not the tax credit subsidised cost? Probably the car valet would be 3 times more expensive. Saying “at least it keeps them off the street” or “at least they are controbuting something” is not helping – we need people to be deployed where the market determines they are really needed.

        Like

    • 82
      Tesco says:

      If the minimum wage is increased, we’ll end up with most of it!

      Like

  5. 10
    Chukka Khan('t) says:

    Oh yes, Chukkah’s been wonderful to watch!

    Like

  6. 11

    That’s the spirit!

    Nationalise everything so there is nothing left for Labour to do.

    Cunning.

    Like

  7. 13
    AnusButtocks says:

    Did anyone see that c’unt Nick Robinson’d piece abut this on the 6pm news yesterday?

    How is it possible such a blatant piece of biased, anti Tory party reporting can be approved by the leftist filth at the BBC?

    I answered me own question aint i

    Like

    • 70
      Bilda Berger says:

      Just curious — is AnusButtocks your surname, and if not, did your mater and pater name you after a rich relative?

      Like

  8. 14
    The Call Centre Calling says:

    It won’t hurt the multinational firms that outsource UK government work to India, but will make it next to impossible for British firms to compete with them.

    Like

    • 21
      A Man From Slough says:

      It’s the smaller businesses that exist on thin margins that will have to deal with any increase in the minimum wage. Internationals have the reserves and ability to move production around: smaller businesses don’t. If their costs increase they can either put prices up and make themselves less competitive; or they can reduce costs by cutting their workforce; or they can go out of business.

      Like

      • 24
        Small Business says:

        Exactly. Even firms that don’t pay wages as low as minimum wage will be affected, as you can bet that there will be pressure for a raise from people who see their own pay ‘differentials’ creeping closer to the new ‘bottom’.

        Like

        • 103
          Lif says:

          At the moment there is still sufficient buffer in the unemployment figures, currently around 2.39 million according to the ONS, for wage increase pressure not likely to be an issue for a while.

          Like

          • FFS says:

            I think probably we will find, in the fullness of time, that paying people to work is rather old fashioned.

            I think we should ultimately find ourselves moving to a model where wages are paid 100% by the taxpayer. This would get the cost of employing people right down and the number of jobs created would be very high.

            I myself would like to start a company employing people to do Gregorian Chants, but sadly the cost of employing people to chant is just too high. If the taxpayer funded these jobs 100% I would definitely take full advantage of it. Before you know it there would be Gergorian Chanting on ever street corner in Britain. In the fullness of time the taxpyer could 100% subsidise those employees providing Gregorian chanting on every street in the EU. Clearly that would vastly improve today’s employment figures.

            I think this is a model of the economy we can all see the sense in, right?

            Like

      • 52
        We could try this says:

        Or the Gov can ban outsourcing and break up massive corporations that care for nothing but money.

        Like

        • 75
          Small Business says:

          Ban it? The organise it. Have you tried getting work from your local Town Hall?

          It is utterly impossible for many local small business to get work from public authorites these days becuase purchasing is undertaken by consortiums of local authorites who deliberately roll what could be small contracts into a form that only the brib-paying multinationals can bid for. The bidding processes are incredibly expensive to contemplate engaging in for small firms and are conducted in a language that might look like English but is alien to anyone who is not a member of the magic circle of corrupt existing bidders.

          Like

      • 79
        Bilda Berger says:

        Man from Slough: you are not wrong. The govt these days is in an unholy alliance with big business, all under the aegis of the banksters. It’s called fascism, and whether you vote blue, red, orange, purple or even green, more fascism is what you’ll get.

        Like

    • 22
      Mr Potato Head says:

      Yes more British jobs will be going abroad. And more unscrupulous employers will cheat the workers by not paying the minimum wage. This is just the Tories using socialism in the same cack-handed way as Labour used capitalism under Blair/Brown. And we all know how that ended up.

      Like

    • 28
      Clueless says:

      Yep – European Round Table firms and the CBI will *heart* Georgie for making UK SMEs and micro enterprises less competitive in favour of the Eurocorporates

      But then he’s still just a knobhead who thinks consumer spending rather than competitive business markets is the route to growth

      Like

    • 42
      Equality for all? says:

      People already on 7 quid an hour won’t be getting a raise: all George is doing is creating a nation with more and more people earning exactly the same at the bottom of the pile.

      Like

      • 57
        Hooray says:

        At last, someone with some sense who can see what the little bastard is doing

        Like

      • 124
        FFS says:

        That doesn’t follow. Employers will still need to retain the pyramid of existing wage structures. Although in reality the next level up of management in retail is probably getting paid 2 or 3 times what the ladies on the till are getting paid.

        Like

  9. 19
    Winston says:

    Good to see the Adam Smith Institutes priorities: keeping UK workers on benefits so that we can keep importing cheap labour.

    Like

  10. 20
    Gog says:

    Wage inflation is under 1% and has been for 4 years now.

    So that is 4 years that we have suffered the permanent austerity to pay for QE and tax cuts for the banksters – and the Tories defending the piratical banking industry and their multi million £ salaries and bonuses that they are being paid in publicly owned banks.

    The assertion by Osborne that a 10% increase in the min. wage is good and “shares in the growth of the economy” is unpleasantly deluded. The minimum wage should have become the Living Wage – there is NO excuse for doing this at a time of Victorian wealth distribution.

    Equally there is no chance of the majority’s average wage inflation going up

    There are another £25 billion of cuts coming along – Osborne said this the other week – so if you think this is unqualified good news, you have a sharp shock coming. What Osborne gives in one hand, he takes with another. Yet STILL the rich are getting richer.

    This is the same old same old hypocritical and incompetent performance by an incompetent

    Like

    • 29
      Mr Potato Head says:

      The cuts are for things like welfare benefits which are reducing anyway as more people are working. The poor will get poorer if they are out of a job and deterring employers from taking on workers or keeping the ones they don’t really want is going to make more families poor. This is something that socialism always ignores. It is called logic. Socialism is both evil and stupid.

      Like

      • 59
        Ffs says:

        Going to Tescos for 40 hrs a week so you can continue to claim benefits is not work

        Like

        • 127
          FFS says:

          I am FFS, not you.

          However, you are correct. The benefits you can claim on a minmum wage are much the same as when on welfare – you only lose job-seekers allowance which is probably the least generous.

          Like

    • 31

      The crony-socialism of the Banksters is all Gordon’s doing. It’ll take a generation to heal his damage to UK commerce. And I’ve got news for you. Come good times or bad times, the prudent and foresighted will invariably create wealth and end up richer. The feckless invariably blame everyone but themselves for their poverty. Same old socialists, the politics of envy is in their genes.

      Like

      • 72
        The minimum wage always becomes the maximum wage says:

        What you say concerning the hard working/feckless is true.

        However, you omit a third, ever increasing class. The one which works, full time, for subsitence wages, who’s lives are valued at less than farm machinery, who, when they quite rightly complain about such a vile system are condemned as either workshy, feckless or socialist.

        Like

  11. 23

    If the rise in minimum wage is turned into a zero-sum game by reducing business taxes, then there is some logic in having folk in employment rather than in the job centre. However, it is still controlling the means of production through the State – the nirvana of socialism. More proof that the Cameroons are social-democrats, not conservatives.

    Like

    • 32
      Small Business says:

      The reduction in business taxes is OK for larger firms that pay them, but many small businesses do not make large profits and pay very many business taxes other than rates and VAT: which are not based on their profits but are acting as a brake on the deployment of working capital and amount to operating costs.

      Like

      • 43
        Lif says:

        The greatest problem tax for small businesses, is business rates from the local council. The second problem tax is employers’ NICs.
        Neither of these relates to company performance in the slightest way.

        Like

        • 92
          The minimum wage always becomes the maximum wage says:

          No, the greatest problem for small businesses is VAT. Granted, the others are terrible too, but VAT is by far the worst.

          Big business have large expenses on stock whick allows them to claim back that portion of VAT.

          Small businesses tend to revolve around manual labour – painters and decorators, plumbers, cafes, etc. Their stock costs are minimal and therefore their claim on VAT is minimal, leaving them with what is, in effect, a tax on turnover. Aside from the utter pain in the ass that is the working out of returns every three months.

          Like

          • Lif says:

            Businesses, no matter their size, can only claim back the VAT they’ve actually spent, so if small businesses don’t spend much, they can’t claim much.

            VAT is an issue on businesses when they are slightly over the registration threshold, since they may be competing with other businesses below the threshold which would be able to supply goods or services cheaper since they do not include VAT. But that’s the only effect of VAT.

            Like

          • jgm2 says:

            The biggest issue with VAT is that it’s a tax on turnover NOT profit and it’s a pain in the arse to administer.

            Like

          • My Daughter says:

            VAT all goes to Merkel.

            Like

          • Lif says:

            VAT is not a tax on turnover, it is tax neutral (except as I outlined above).

            Like

          • jgm2 says:

            VAT ISa tax on turnover. My missus does (say) 10K of work but must bill 12K and send 2K off to HMRC.

            The VAT man isn’t interested in profit or loss. He wants that 2K. A tax on turnover.

            Like

          • The minimum wage always becomes the maximum wage says:

            Jgm2 is correct and Lif has never run a business in his life.

            Lif, it is true that a company can only claim back what they have spent in VAT. This means big business with high stock costs and low manual labour requirements get their products at a discount of 20%.

            Businesses with little or no stock and high manual labour requirements effectively pay 20% of the income, not profit, of each individual job they invoice.

            A tax on turnover.

            Like

          • Lif says:

            We are talking about small businesses and they can use the Cash Accounting scheme, so they never have to pay VAT to the tax man until they have received their invoices.

            Like

          • Lif says:

            @jgm2

            So your wife’s turnover is £10k not £12k, the VAT element is not hers.

            And using cash accounting, she would not have to pay the VAT before she received the payment for her services.

            HMRC Cash Accounting for VAT
            Using standard VAT accounting, you pay VAT on your sales whether or not your customer has paid you. Using cash accounting, you do not need to pay VAT until your customer has paid you. If your customer never pays you, you never have to pay the VAT.

            You can use cash accounting if your estimated VAT taxable turnover during the next tax year is not more than £1.35 million.

            You can continue to use cash accounting until your VAT taxable turnover exceeds £1.6 million.

            Like

        • 200
          BarryW says:

          Business Rates are set by central government and are only collected by the local authority to be paid over to central government.
          Blame your local MP, not your local Councillor.

          Like

    • 141
      FFS says:

      “However, it is still controlling the means of production through the State – the nirvana of socialism.”

      But then again we are currently using the wealth created by middle-class employees in primary industry and exporting industry to subsidise people in jobs that may or may not be almost entirely worthless except we can’t tell because they are effectively subsidised through the tax credit system.

      Putting up the minimum wage is only saying”Look, you have to pay everybody enough to clothe themselves, feed themsleves, put a roof over their head. If you can’t pay them enough to do at least that, it’s actually a non-job and you should fuck off and let a proper businessman have a go”.

      In any case, the capitalist system has two parts to the equation – production AND consumption. There is no point having the means to production if nobody can afford to consume. We are slowoly moving to a situation where there are all manner of clever tricks to increase production but nobody can afford to consume anymore. Putting up the minimum wage actually helps increase consumption, rather than allowing to corporates to build up big profits to fund German pensions.

      Like

  12. 26
    B Boyd says:

    Ed is doing well running the country from the opposition. How many U Turns is that now?

    NMW bitterly opposed by the Tories now they are championing it!

    Social care moved from council responsibility to the NHS? Another Labour policy!

    Reduction in utility bills? Yep Labour pushed for that!

    Whatever happened to bombing Syria? Oh yeah The Government lost their three line whip vote!

    Ed is doing alright running the country on behalf of the policy light Cameron and Osborne comedy duo.

    Like

    • 36
      Mr Potato Head says:

      This all goes to prove the Liblabcon-men are all the same, as if further proof was needed. Anyone who still cant see this yet is thick.

      Like

    • 46

      It’s his grasp of economics that the key to Miilibandwagon’s success.

      Like

    • 66
      The Critic says:

      You forgot Ed’s genius idea to make banks sell off branches to create competition. He is of course,clueless. New banks will not want the overhead of running branches,so who will buy them? Then what?

      The man is a soundbyte fueled duckheed.

      Don’t confuse the noise he makes with policy. He has nothing other than banker bashing and whatever today’s bandwagon is. He’s even protesting against policies he supported in government.

      Like

  13. 27
    Just wondrin says:

    If a lawyer has an ab ortion, is it a miscarriage of justice?

    Like

  14. 34
    Casual Observer 5 says:

    Anyone would think that someone is trying to undermine Ed Balls, and wheel some Lib Dem Trojan Mares into UKIP for pre-GE attack in the house.

    Why are Labour’s feminist wing not crucifying Clegg for his lack of action ?

    Is it because they in fact: ‘love it’ ?

    At least Cameron keeps his hands in his pockets and his fly buttoned up. Incredible considering his otherwise unique ability to not act with integrity on the matter of promises / vows, or is he just firmly ‘under the thumb’ ?

    Increase in minimum wage is fine if higher unemployment rate is desired. It would however be a fairly inflationary move, and not altogether business friendly. Perhaps this is an EU thing which is why business the other day were saying they they are not bothered about UK exit.

    All roads lead to UKIP – Yet no one has properly picked up on the implications of Nigel’s willingness to suffer a small loss for a large gain.

    Are some scared of the resonance and implications of that idea ?

    Like

    • 50

      Clegg is playing the least said soonest mended line. The fair sex are being pressurised to keep quiet for fear of losing them even more votes in the run-up to the Euro elections.

      Yet another example of no Democracy and no Liberalism except, of course, for the fat Lord’s fingers.

      Like

      • 64
        Casual Observer 5 says:

        I think there is plenty of liberalism – in the purest sense.

        Also a healthy dose of hypocrisy and deceit as well.

        Can bet your bottom dollar that if this was a Conservative Lord, the Labour harpies would be screaming most shrill from the rooftops for his head on a platter.

        Labour are keeping the veil on that gorgon’s head though as they cannot afford to upset the future possibility of a LibLab coalition being formed.

        The Conservatives know that which is why they are putting pressure on Clegg in order to expose the rank hypocrisy in Labour, a very useful chink in the armor for the placement of a knife.

        Real question is: What have they got on Clegg, or have offered the Lib Dems, in order to have Clegg hold his tongue ? Much as I despise him, defending the likes of Rennard does not seem to be in his character and he understands full well the lasting damage that this is having on his party, and his legacy as leader.

        Like

        • 77

          Someone suggested here a few days ago that the no-go over constituency boundary reform was a back-room deal between Labour and the LibDems.

          Perfectly believable.

          If it were true, then this is nothing in comparison. They will be opening the grandmother futures exchange soon.

          Like

          • Casual Observer 5 says:

            That is very credible.

            A partial antidote to that is UKIP being allowed to run riot up North.

            UKIP are not doing bad up there either.

            Like

          • Indeed but at the greater expense of Labour there.

            This presents the interesting spectacle that we will get a new party in just the same manner as the SDs were formed. Two totally different factions who, after the initial euphoria of success, will end up hating each other!

            Life repeats itself.

            Like

  15. 35
    Hoon watch ... still hooning after all these years says:

    Osborne was quite, cynically, careful not to “call” for an increase, just mentioning that he thought it would be sweet, since it is out of his hands and he would be fucked over by Business if anyone thought he was calling for it.

    In other words, it was pure politicing with the poor.

    The man’s a HOON and I’m voting UKIP.

    Like

  16. 38
    Andrew Efiong says:

    Osborne’s shot Labour’s fox with a bazooka!

    Meanwhile little Millyband is reduced to playing trainsets with the bank sector, shuffling branches and offices around like a wannabe regulator. What a plonker!

    Like

  17. 39
    Fabians are EVIL says:

    Very cunning Osborne – respect!

    Like

  18. 44
    albacore says:

    Osborne’s exchequing is so far up the creek
    He doesn’t know whether it’s now or next week
    Very much like Dave – it’s the same old story
    Both clueless whether they’re Labour or Tory

    Like

    • 56
      Er says:

      Confused dot Con servative.

      Like

    • 73
      Not Albacore says:

      Razzle Dazzle, parry and thrust,
      Painting Tory as Labour, then throwing some dust,
      A good way to expose your opponents deception,
      Is to hold up a mirror, and have them fight their reflection.

      Like

  19. 47
    Repeat says:

    Latest: Mikaeel Kular still missing. Vaz on way.

    Like

  20. 48
    Greed is good is their mantra says:

    This is bollocks. Employers can easily afford to pay that amount. It’s just pure greed that makes them say they can’t.

    Like

    • 58
      Er says:

      Therefore …all employers are greedy. Nice one. You won’t be starting up a new business then?

      Like

      • 108
        The minimum wage always becomes the maximum wage says:

        People like you cheerlead the cause of your own enslavement, unless of course you are a slave owner.

        Like

    • 71
      civil engineering plant says:

      You tell that to bosses in small, local retail and catering.

      Like

      • 98
        Long John Silver's parrot says:

        Best not to employ anyone, just stay self employed.

        Like

      • 117
        The minimum wage always becomes the maximum wage says:

        If you sell your products at such a ridiculously low price you cannot pay your workers a fair wage, so little they have to claim benefits as well as work, you have a faulty business model, you are not a job creator, you are not a wealth creator, you should just pack up the whole sorry show and go home.

        Perhaps you should get a job for 6.50 an hour? What? Not for you, it’s for the little people, who should be eternally grateful for drippings off your snout?

        Like

      • 152
        FFS says:

        The same issue will apply to all of then at the same time. Therefore they will be free to simply pass on their costs to all of their customers and remain competitive, much the same as they would if they had to handle a VAT increase.

        Unless of course you are telling us that your deeley-bopper business might not look so attractive to people if you wage costs have gone up 15%?

        Like

    • 92
      Small Business says:

      You clearly have no idea how small family firms subsist.

      Most ‘greedy bosses’ are the bosses of small firms employing one or two people, often their own relatives. I know of many a small firm where the boss gets paid last or nothing at all at the end of the week.

      Like

      • 120
        The minimum wage always becomes the maximum wage says:

        The answer to those kinds of problems is to either increase productivity, or prices, or both.

        It is not the answer to decrease wages.

        Like

    • 96
      Labour's supporters are mind-numbingly dim. says:

      There’s an article in today’s Times about a bookshop owner who makes £10,000 p/a. That’s his total profit for running his business. One day recently his takings were £7.50.

      You tell him he can easily afford to pay someone £7 per hour (plus employers’ national insurance tax).

      Like

      • 125
        The minimum wage always becomes the maximum wage says:

        I would tell him that his business model is faulty. It’s nothing to do with wages if his daily turnover is 7 quid.

        He needs to either reform his business model or shut up shop. Robbing his workers for his piss poor management is not a suitable solution to the fact that he is offering goods and services in such a way that no one wants to buy them

        Like

        • 135
          jgm2 says:

          How will shutting up shop improve unemployment or training for young people?

          I agree he should shut up shop but are you going to open a business to take his place? I’m not.

          Like

          • You are right. Disposable income has not got so high that it is falling out of people’s pockets onto the streets.

            Good to see you again. Been away anywhere nice?

            Like

          • FFS says:

            Why is he only making £10,000 per year? Because he can’t compete with the likes of Amazon and Waterstones.

            Amazon and Waterstones will also need to handle the increase in the minimum wage. He will not become less competitive because he has to handle the minmum wage increase – in principle this can be passed on to customers.

            In practice his inability to make money out of bookselling is because his business model is old hat.

            He should close up shop like many other independent bookshops and allow Amazon and Waterstones to expand. They will pay the minimum wage even if he doesn’t want to.

            That’s progress. No room for sentimentality in business – if you are the sentimental type stay well away from business – try the charity sector instead.

            Like

          • jgm2 says:

            2013 was a bumper year for holidays. A bit more effort and I might start qualifying under the 90 day rule again.

            Dipping my toe back in here to see if they’ve sorted out their moderation yet.

            You’ve got to love all these self-proclaimed bedwetter business experts telling you that a bloke who is probably working 70 hour weeks for a 10K profit should get a better business model.

            If only they would get a better business model and put it into action. Show us how it’s done instead of carping from the cheap seats.

            I know it’s not easy which is why I don’t do it.

            Like

  21. 49
    Confused.com says:

    It’s just politicking. The Ed Balls “nightmare” e-mail showed us a yet largely unused carrot for those working at the bottom end of the labour market – “recovery for all”.

    They’ve been pushing the “living wage” which in 2010 was higher than the “minimum wage”, with the conservatives narrowly in favour of the latter.

    So the fact that business leaders are now suggesting that an 11% rise within 2 years would be far too expensive for employers completely destroys Labour’s position on the “living wage”.

    Anyway, a minimum wage wont combat poverty, it’s simply a device used to end exploitation.

    Like

  22. 51
    The Darth Vader Death Stare says:

    Like

  23. 53
    Peter Ell says:

    The big problem with increasing the minimum wage isn’t that it will increase unemployment – employers still need the work done.

    The bigger issue is that it will increase the already burgeoning Underground Economy. Employers in businesses dealing cash routinely pay around £4 per hour ( plus time off to sign on, of course). Or employ people through the books part-time but top-up in cash, which is desperately difficult for the authorities to prove.

    Ever wondered why part-time employment has taken off, Mr Politician?? Going to do anything about it?? Ah, your office is staffed with “interns” working for free whilst you spend your staff allowances on “employing” your family – ‘nuff said!

    Like

    • 65
      JH2303409329-3423 says:

      The big problem with increasing the minimum wage isn’t that it will increase unemployment – employers still need the work done.

      NO, you are presuming there is a fixed amount of work to be ‘done’, a similar fallacy to presuming there is a fixed pie of ‘wealth’ that can be shared out to those who did not bake it without affecting its future size.

      If an employer is looking to expand they will look coldly at the benefit of doing so. If the marginal cost of the extra labour required makes it unprofitable, then guess what. They won’t expand, and those jobs will never exist.

      A higher minimum wage also makes automation more attractive. Whoops! Once again, the law of unintended consequences strikes and you achieve the exact opposite of your stated goals.

      Like

      • 138
        The minimum wage always becomes the maximum wage says:

        Expansion is not driven by the cost of labour but by the size of the available market.

        If you cannot make a profit from selling widgets when your unit labour cost is 7 quid an hour, you should either attempt to grow the market or not expand.

        Your argument only holds water if we were talking about a ridiculously high labour cost, and seven quid an hour is not high, it is an insult, not a wage.

        Like

      • 163
        My Daughter says:

        Empty my bin once a week please.

        Like

      • 167
        FFS says:

        Ah, you really need to think through that macro-economics again.

        The amount of wealth in the system stays the same. The wealth will now be distributed more to those at the bottom end of the wage pyramid. They will now have a higher net disposable income. Some businesses will want to get their hands on that extra income and will expand.

        One could imagine that retailers will actually find their revenue increases due to more spending at the bottom end but this will be compensated by higher wage costs. Profit will likely be slightly hit – bad news for those German pension funds.

        Like

        • 191
          The minimum wage always becomes the maximum wage says:

          The wealth in the system only stays the same if the Gov do not continually print billions of what are effevtively counterfeit notes.

          Like

      • 186
        Anonymous says:

        A higher minimum wage also makes automation more attractive. Whoops!

        As if employers are not going to scrap their workforce and go for automation at the first opportunity.

        Just look at the supermarkets and the new automated tills replacing the checkout staff on the current minimum wage.

        If employers could get away without paying any wages at all, they f-ing well would.

        Don’t blame the workers for inflation, rising transport costs, rip off utility companies, and most of all, an inflated property / rip off rent market.

        Like

        • 206
          Axe The Telly Tax & Religion & Kill All Eco-loons says:

          If more people shopped online for their groceries then there would be more secure jobs created. I pay someone at my local ASDA store to do my shopping for me and another person to deliver it to my door.

          Both of these jobs are secure in that they cannot be automated unlike checkout jobs. Anyone can pick someones shopping for them, no skills required other than reading a shopping list, and anyone with a driving license can become a delivery driver.

          You can get on with more productive things while someone else does the mundane shopping run for you.
          :-)

          Like

  24. 60
    Anonymous says:

    How do the wonks square the fact that the imposition of the minimum wage didn’t result in the unemployment they forecast then?

    Like

    • 68
      Ex paperboy says:

      Why not make the minimum wage £100 an hour if it won’t affect unemployment?

      Like

      • 88
        Long John Silver's parrot says:

        If the minimum wage legislation has been an unmitigated success then perhaps the more you increase the minimum wage then the more success you will have.

        Like

      • 90
        Anonymous says:

        That’s not the answer to the question. Try again.

        Like

      • 172
        FFS says:

        Why not reduces wages to £0?

        Hmmm, something tells me that £100/hr might be survivable but £0 an hour maybe not!

        I’d always go for pushing up the minimum wage. Putting up wages puts more money in the hands of consumers so they spend more so it all goes round the system anyway. Reducing wages actually brings the economy to a halt. If low wages gave you a good economy then Africa would be a great place to live.

        Like

    • 109
      Small Business says:

      How do you know what jobs were or were not created in the UK as a result of minimum wage? Many jobs that could have been created in the UK have been created overseas by British countries in the last few years.

      My company outsources a lot of work overseas at rates that are below the rates we’d have to pay in the UK. In fact this work is generally above even UK minimum pay rates, as we work in a specialised field requiring specialist skills, but I am sure that there are plenty of businesses sending work abroad at rates below the UK minimum wage rates.

      Like

      • 175
        FFS says:

        I get work done in China at £1 per hour. They are starting to charge more so we are looking at Mexico and India. Some of my competitors already active in Tunisia and such places.

        £6/hr or £7/hr who gives a damn? You can’t compete with £1 an hour in China anyway, and most of the people working in our UK factory on these below subsistence wages are foreign. I’d rather close the UK factory, tell the immigrant employees to fuck off back to Poland and open a new factory in China but board of directors won’t let me – too radical for them. Shame – we would make more UK profit and pay higher taxes too and I like the Chinese. What’s not to like?

        Like

    • 110
      Mr Potato Head says:

      It did. That is why there was and still is far too much youth unemployment and why so many people went on invalidity benefit.

      Like

      • 145
        The minimum wage always becomes the maximum wage says:

        Youth unemployment is high because the legal minimum wage is less than 3 quid an hour.

        Along with the fact that youth have had a shit education and are largely unemployable.

        Like

        • 179
          FFS says:

          Bollox. Most jobs in the UK require almost no education. Anybody that can drive a car is skilled enough to get a job.

          We are in a recession. Shit happens.

          If we had a government that had any sense it would work like this – boom time: use green cards to allow unskilled and semi-skilled employment in the UK to expand above 10% of normal. Recession: terminate the green-card system and send the immigrants home – retain 100% UK employment.

          Simple. But I’m not running the UK. A succession of jokers is running the UK.

          Like

  25. 63
    Anonymous says:

    We currently have a system where my money is taken in taxes to top up wages. Far better for employers to pay this rather than me.

    Like

  26. 67

    Things cannot be dumbed down any further, warn experts – Daily Mash

    Like

  27. 78
    Anonymous says:

    So how come exorbitant shareholder dividends and vast executive bonuses/salaries aren’t ‘damaging to the economy’ in the same way paying the poorest a few more pence an hour is?

    Or are these just greedy motherf*ckers who want to keep all the money for themselves?

    Like

    • 99
      Ex paperboy says:

      The average FTSE 100 dividend is ~ 3.5%. That’s not a lot of reward for risking your money. Hardly ‘exorbitant shareholder dividends’. In any case the majority of those shareholders are people’s pension funds.

      You expend too much time worrying about a few rich people and not enough worrying about the knock-on effects of your spite on the other 99%.

      Like

      • 150
        The minimum wage always becomes the maximum wage says:

        7 times higher than BofE interest rates, and not a bad return for doing nothing.

        Like

      • 181
        FFS says:

        3.5% of what? The increasing traded capital value of the share?

        It’s all about yield, and averages are irrelevant – why invest in a company that’s had its day?

        Like

    • 129
      Kareer Koche says:

      If you have no skills, no qualifications* and a piss-poor attitude, how much do you think you’re worth to an employer?

      (A CSE grade IX in Warming Studies does not count).

      Like

      • 153
        The minimum wage always becomes the maximum wage says:

        Plenty of people with good educations work for minimum wage, slandering the exploited won’t work, try again.

        Like

        • 160
          The UK has some of the best qualified checkout operators in the World says:

          Too right….there are many many graduates who went to the “Russell Group” of universties(not jumped up polytechnics)and graduated with first and upper seconds in “hard” scince based, mathematic based subject NOT “media or american studies” who still can’t get a job after many applications and end up flippin’ burgers or serving on supermarket check-outs minimum wage and part time

          Like

  28. 80
    Lost in Clacton says:

    Does this mean that interest rates are about to rise ?

    Like

    • 83
      Long John Silver's parrot says:

      Vat at 23% I heard.

      Like

    • 102
      retardEd Miliband says:

      Intewetht wate cwithith!

      Like

    • 131
      Lif says:

      No, the opposite. Since inflation has decreased, the BoE can keep the interest rates at 0.5% even more easily.

      Like

      • 155
        The minimum wage always becomes the maximum wage says:

        If you think inflation has decreased I have a nice bridge to sell to you.

        How can a nation print billions AND have deflation?

        Like

        • 183
          FFS says:

          If it doesn’t print enough to compensate for a descrease in debt outstanding.

          Research “Broad money supply”.

          Like

          • The minimum wage always becomes the maximum wage says:

            But national debt has increased, enormously.

            The deficit has decreased, slightly, allegedly. Different, init?

            Like

        • 204
          Lif says:

          A decrease in the rate of inflation is not deflation.

          Like

          • The minimum wage always becomes the maximum wage says:

            It is relative to the inflation.

            Like

          • Lif says:

            No.
            Deflation means precisely that inflation becomes less than 0%.

            A decrease in the rate of inflation from 3% to 2% is merely a lessesning in the rate of increase.

            Like

          • The minimum wage always becomes the maximum wage says:

            No, you’re wrong. When it is viewed as describe, relative to inflation.

            Like

          • Lif says:

            When the rate of inflation decreases from 3% to 2%, the cost of your pint of lager shandy will still cost more tomorrow than it does today.

            When deflation occurs, the cost of your pint of lager shandy will cost less tomorrow than it does today.

            Do you understand yet?

            Like

  29. 94
    Lord Rennard's theme song says:

    Like

  30. 107
    Poo Watch says:

    Perhaps PMQs have been quiet recently because they have run out of Poo to throw.

    When is Gordon Brown due to return to replenish stocks ?

    Like

  31. 111
    Casual Observer 5 says:

    Are the MP’s still looking for their 11% payrise, or whatever it was ?

    This kind of announcement will encourage more Euro Trash to come to the UK.

    Like

  32. 113
    The most perfect summation of corporatism says:

    Like

  33. 114
    George Smith says:

    Universal Credit will be delivered on time and on budget.

    Like

  34. 116
    The British media are cunts says:

    Many foreign workers work for less than the minimum wage. At present in the UK low wages are topped up by endless state benefits. The solution is to raise the minimum wage but cut taxes as well. Let workers earn more and keep more of what they earn but stop the state handing out billions in welfare. Let rich bosses pay a decent wage.

    Like

    • 130
      Mr Potato Head says:

      And what about poor bosses? Should they go bankrupt and create no jobs?

      Like

    • 134
      Mr Potato Head says:

      And what about poor bosses? Should they go bust and not only not create jobs but actually put all their workforce out of a job?

      Like

      • 162
        The minimum wage always becomes the maximum wage says:

        Awww, the poor wiccle bosses. Such philanthropic souls, the embodiment of altruism, creating all those jobs to help the smelly poor people. Whilst not taking a penny for themselves. Salt of the earth.

        Like

        • 171
          jgm2 says:

          Many bosses don’t take much money for themselves. Just as, apparently, when the middle classes come under financial pressure the cleaner is the last to go, so it is with many SMEs. They’ll take out personal loans, remortgage the house, credit card loans, anything to try and keep the business going and their loyal workforce employed and yet we can see the thanks they’ll get from the likes of you.

          I wouldn’t bother.

          Like

          • The minimum wage always becomes the maximum wage says:

            I am an employer, ran my own businesses for over 20 years. Done all those things at one time or the other, but I have never sought to get through a tough patch by extorting my employees of their wages.

            So that’s pissed on your fireworks.

            Like

          • You, less than an hour ago says:

            Such philanthropic souls, the embodiment of altruism, creating all those jobs to help the smelly poor people. Whilst not taking a penny for themselves. Salt of the earth.

            Like

          • The minimum wage always becomes the maximum wage says:

            You prove my point for me. It is not necessary to be a grasping, theiving, greedy pig of a boss, as unfortunately so many of them are, to be successful in business.

            I speak from a position of experience, I have been a toilet cleanet and a boss, I have been there, seen it and done it.

            The idea that the status quo is precisely that because there is no other way is nonsense.

            Like

      • 165
        And why is wage demand high? says:

        Perhaps if we had sensible house prices and rents, wage demand would be less?

        Employers should have a word with those vested interests driving up the cost of the ‘luxury’ of having a roof over their employee’s heads.

        A low wages, sky high property priced economy is unsustainable without massive tax payer funded benefits to employers, employees and landlords.

        Time those that see property as a magic money tree took a hit, rather than letting them drag the rest of the economy down.

        Like

      • 185
        FFS says:

        Plenty of money making opportunities because people at the bottom end will be paid more and will have more money in hand.

        Like

  35. 122
    No justice, no peas! says:

    Police watchdog the IPCC says it is pursuing “a number of significant lines of enquiry” over Mark Duggan shooting

    Like

    • 187
      FFS says:

      Like “Did one of the idiot plod that saw the gun lying on the ground next to Duggan hidden in a sock think it was a bit of rubbish getting in the way of the paramedics and threw it over the fence to get it out of the way, which then resulted in a cover-up of their incompetence”

      Oh yes, I think so.

      Like

    • 196
      Couldn't care less about Mark Thuggan says:

      Will the enquiry take into account the amount of murders, drug deals and armed robberies that have been prevented by disposing of this vermin?

      Like

  36. 123
    Mr Potato Head says:

    What nobody (at least none I have read) have said is that the economy goes round in cycles. So we have mini-booms and busts in employment demand. It may be OK now to increase the minimum wage as there is currently a recovery (though nobody knows how long it will last) but when the recovery ends, as night follows day, employers will be more determined than ever to get rid of workers if they are paying them more than they can afford. Therefore ANY minimum wage is wrong. It is no surprise therefore that unemployment was HIGHER at the end of 13 years of a Labour government than when it started (despite all the non-jobs in the public sector).

    Like

    • 133
      jgm2 says:

      It was because of all the non-jobs created in the public sector and the payrises given to all of them during Brown’s imbecile tenure that our structural deficit is so vast.

      Like

      • 151
        A lesson from history says:

        Not to mention his almost byzantine system of tax credits,benefits and taxes where he took away with one hand and people had to fill out vast reams of claim forms to get their own money back. Nobody fully understood it….not even him I suspect.

        Still it was always a joy to behold his partisan budget announcements to be immediately followed by Labour supporting media pundits on the BBC extolling his virtues and the so called schemes and tax breaks he was announcing for the “poor” and “pensioners” only to find that within hours all his announcements were just a crock load of shit and these people were actually worse off whislt people were actually encouraged to borrow borrow borrow and spend spend spend to finance the illusion of a booming economy

        Never ever forget who were his advisers…two young up and coming men in the Labour Party..the two “Edwards”…Miliband and Balls…tells you ALL you need to know about Labour’s economic policies

        Like

        • 169
          jgm2 says:

          Yeah, that too.

          Just like the FSA. They confused generating reams of rules and ‘guidelines’ with doing a proper fucking job.

          Just as they confused squandering hundreds of billions in pay-rises and PFI as improving the NHS.

          Like

          • FFS says:

            “Therefore ANY minimum wage is wrong.”

            Makes sense. Pay them nothing. In fact make them pay you for giving them something to keep them occupied.

            Let’s see how well UK business does when their customers have no cash.

            Like

  37. 136
    Auntie Duggan says:

    No justice no pizza!

    Like

  38. 137
    Helpful says:

    It also increases the room that criminals need to operate in. The criminal gang-masters that the Left get upset about love a minimum wage because legitimate businesses cannot compete with them.

    It also means people with little experience or education or training or skills find it harder to get on the jobs ladder.

    If they bring this in, they should also allow individuals to opt out of the minimum wage rules. There are people out there who would take a job on lower than minimum wage to get started: all you have to do is look at the people willing to apply for unpaid internships to see it is true.

    Like

  39. 143
    Anonymous says:

    £7 hr for 40 hrs = £280 x 52 =£14560 – will still pay tax and NI on the minimium wage welcome to life on the dole.

    Like

    • 192
      FFS says:

      Job seekers allowance = £57 per week = £2964 per year compared with £14560 minimum wage.

      All other benefits will remain the same.

      Ergo, it will increase the incentive to find work.

      Like

  40. 146
    Anonymous says:

    £7 hr for 40 hrs = £280 x 52 =£14560 – will still pay tax and NI on the minimum wage welcome to life on the dole.

    Like

    • 154
      jgm2 says:

      That’s one good thing the Lib Dems have done. Moving the tax-free limit up to 10,000. Brown left it somewhere around 5,000. Fiscal drag I believe it’s called.

      Like

  41. 159
    Bullseye says:

    More please!

    Like

  42. 190
    Displaced Brummie says:

    “Top Wonks Slam Osborne’s Minimum Wage Rise”

    This reminds me of the old cartoon: “London, Sir? Oh, if you want to get to London, I wouldn’t start from here!”

    But it appears the “Think” tanks are unaware of where we are. Which is a bit worrying, really…

    Like

    • 193
      FFS says:

      “Top Wonks (funded by big retailers) Slam Osborne’s Minimum Wage Rise (otherwise they just wouldn’t bother)”

      Like

  43. 209
    Just sayin' says:

    Does anyone in the socialist party (sorry, the Tories) remember the strikes about ‘differentials’? Osborne maybe not. Anyway he’s a supporter of State control of wages and wants to transfer more welfare costs to business which he thinks they can all afford.

    But it’s not just the MW. I wonder how people who are on say, £7.50 an hour, will feel when a MW worker, on £6.31 now gets £7.00? I guess they would want a pay rise, and quite right too. So that’s more cost to business. My hourly rate, which is a £2.50 or so above the present MW is being devalued. I want more, and I’m going to ask for it.

    Inflation anyone? But of course, that’s what he wants! The whole thing is bound to stir up trouble, maybe not immediately, but it will happen.

    Like

  44. 210
    Jimmy says:

    Who knows, if they keep repeating the same prediction maybe one day they’ll be right?

    http://www.adamsmith.org/sites/default/files/images/uploads/publications/Minimum_Wage.pdf

    Just kidding.

    Like

  45. 222
    Nemesis says:

    £7 an hour. Oh whoopee we’re going to have a great time on that/ I’d love to see some of the greedy business owners manage on even treble that amount – fucking overpaid arseholes who who haven’t a clue about real life.

    Like

  46. 223
    Edinburgh Skanky Shitty says:

    It still needs to be resolved with lower taxes etc.

    Like

  47. 224
    NotPartisan says:

    I am in favour of minimum wage. But a link must be firmly established. The minimum wage must be equal in a 40 hour week to the single person’s tax allowance. If big brother deems to dictate wages and consider anything below some arbitrary threshold to be too little, then they should not dream of taxing such a paltry amount.

    This would mean a government jacking up tax thresholds to win an election would jack up minimum wages, and one jacking up minimum wages for the same reason would feel an impact on its tax take.

    I doubt there would be much impact on jobs. Any manufacturer who needs lower labour costs would mechanise production to eliminate the labour. Cheap production is already offshored. So we are really looking at service sector jobs. I would suggest that these at the lower end of the wage scale cater mostly to domestic customers. So if the net effect is lower welfare bills as taxpayer subsidy is removed, then theres not much loss to greater society bygoing down that route.

    Like


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Austrian Chancellor Werner Faymann on Cameron’s refusal to pay the £1.7 billion EU bill by December 1st:

“Well, then he’s gonna pay on December 2nd”



Mycroft says:

Have you read the last bit of Animal Farm?

You know where the animals are looking through the Farmhouse window?

My TV screen was that window at lunch-time today.

Be careful, the sudden self-congratulatory tone, the slightly pudgy outline of indulgence and you become exactly what you should despise.

The jolly face of the Quisling Cameron poses for your camera has mesmerised and deceived you, you who were once not so deceived.

You were no firebrand, you were a damp squib in my opinion, sorry.

You need a damned good kick up the ahse!


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