Tag Archives: minimum-wage

MPs just “don’t get” the minimum wage

David Wilshire has been hilariously telling any journalist who will listen that his £65,000 annual salary is “dangerously close to the minimum wage” – which means that he must be working a 30 hours a day, 7 days a week (or 24 hours a day, 9 days a week – take your pick). But he isn’t the only MP who doesn’t seem to know at what level the minimum wage is set at.

Throughout the week there have been noises off about Sir Thomas Legg’s retrospective limit of £2,000 a year to claim on cleaning, with MPs and trade unionists claiming that it would mean MPs being forced to pay their cleaners less than “a decent living wage.” As is the nature of such things, this “well known fact” has started to get parroted in passing uncritically.

This being British journalism, no journo I have come across has yet had the wherewithall to sit down with a calculator for five minutes to determine the veracity of that fact but it isn’t exactly difficult. First of all, what is a living wage? Well, the London Living Wage, as supported by trade unions, is £7.60 an hour. In my unforgiveably middle class household, we pay our cleaner £9.50. From my straw poll of people I know, rates paid have varied significantly. The most I’ve been heard about is £15, which is apparently the going rate in Kensington.

Let’s assume £15 an hour, which is roughly double the living wage and which amounts to more than I earnt when I started my current job even taking into account national insurance (in fact it’s more than I currently earn, but then I’m down to a four day week these days). Let’s also assume that MPs second home is, at most, a two bedroom flat (that’s a reasonable assumption isn’t it? Second homes are meant to be boltholes, not luxurious family homes. Luxurious family homes are first homes, unless you’re on the fiddle).

It takes five hours to fully clean our four bedroom home here; no-one I know with a flat pays their cleaner for more than two hours to clean it. So, even assuming the £15 hourly rate, that would cost MPs £30 a week, or £1,560. And that’s assuming they use a cleaner 52 weeks of the year – despite the fact that for much of the year they will presumably not be using their London-based flat as Parliament will be in recess.

So, after all that, can anyone explain to me how trade unions of all people have managed to establish that £2,000 is too low a limit to spend on cleaning? The problem, I suspect, is that the people at the top of trade unions these days are about as in touch with the reality of peoples’ daily lives as, well, David Wilshire. Unlike the average MP, they don’t even hold weekly surgeries. The rot in the political class is not limited to Parliament.

Rage Over Age Rates

The answer to my earlier question “Will the Lib Dems finally get serious about taxation this morning?” was sadly no. With housing now more of an issue than it was in 2005, expect local income tax, which seemed to do us almost as much harm as good, to start actively damaging us as Labour and the Tories start writing to first time buyers about how the Lib Dems will both make their first home even more unaffordable. I’m sure these people, who claim to be having more visits to their website at the moment than ever, will be most receptive.

Meanwhile, we are to have another debate this afternoon on poverty. One of the main topics of debate will be whether or not to drop the Lib Dems’ longstanding commitment to have a single minimum wage rate regardless of age. I spent much of this morning handing out flyers, and had an odd sense of deja vu: 9 years ago I was standing in the same spot handing out remarkably similar flyers. The difference is, back then I was doing it for LDYS; oddly LDYS don’t appear to give two hoots about this issue any more.

The argument being used for differential age rates is that we should be encouraging younger people to stay in education and training. Apparently, the siren call of £5.35 an hour will tempt them to abandon personal development in favour of making a quick buck. Perhaps if the education and training that we offer them were rather better, they would be less tempted; either way my recollection of being that age was that the actual hourly rate was rather less attractive than the prospect of getting paid. So I was happy to do a Saturday job in the early nineties for a couple of pounds an hour, and when I took a year off (fully intending to go on to HE) I didn’t particularly mind being paid £3.50 an hour full time when I was 18.

Either way, I’m not convinced this is economically sound. If you give companies providing low skilled jobs a clear profit motive to employ 16 year olds, they will employ 16 year olds. Supply has a habit of following demand. On the other hand, if you only had a single hourly rate, companies would surely favour older, more mature applicants.

The bottom line is, this is exploitation pure and simple. That may not bother the Labour Party, but it should bother us. On the same basis you could argue that we should deny minimum wage to immigrants (and then wonder why they continued to come). You could argue that differential age rates should apply to black people on the basis that we want to encourage them to continue with training and education because they face discrimination in the workplace. If that sounds bogus, it’s because it is bogus. What is so magical about age?

I repeat: if you want to encourage young people to continue with training and education, make that training and education mean something. At a time when female politics graduates actually earn less than if they’d started work after their A-levels, I’m not sure you can say we’re doing that.

(I wanted to add this funky public information film here, but annoyingly the archive doesn’t include an embedding facility and I don’t have time to plonk it on YouTube).