Tories say they're increasing the minimum wage.
Only by 20p but it's better than nothing. Does anyone know when this is happening, because if it's after the election it doesn't matter, as Labour want it to be £8 anyway, so it won't encourage people to vote for them, as such I'm assuming this change will be happening pretty soon.
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I suppose the point is to take the kick out of the labour policy. It should encourage people to not vote labour, though I imagine it won't be a very significant factor.
I would point out that if labour want to decrease tuition fees, rise the minimum wage to £8 and increase spending to the NHS, they have to find the money from somewhere.
Only way I see this is through taxation (countering the attractiveness of the £8 an hour), particularly the rich - the so-called mansion tax - but even that won't cover it all...
I would point out that if labour want to decrease tuition fees, rise the minimum wage to £8 and increase spending to the NHS, they have to find the money from somewhere.
Only way I see this is through taxation (countering the attractiveness of the £8 an hour), particularly the rich - the so-called mansion tax - but even that won't cover it all...
Original post by Comeback
I suppose the point is to take the kick out of the labour policy. It should encourage people to not vote labour, though I imagine it won't be a very significant factor.
I would point out that if labour want to decrease tuition fees, rise the minimum wage to £8 and increase spending to the NHS, they have to find the money from somewhere.
Only way I see this is through taxation (countering the attractiveness of the £8 an hour), particularly the rich - the so-called mansion tax - but even that won't cover it all...
I would point out that if labour want to decrease tuition fees, rise the minimum wage to £8 and increase spending to the NHS, they have to find the money from somewhere.
Only way I see this is through taxation (countering the attractiveness of the £8 an hour), particularly the rich - the so-called mansion tax - but even that won't cover it all...
Why would money need to be found for an £8 minimum wage? Surely it'll increase tax revenue?
Original post by Quady
Why would money need to be found for an £8 minimum wage? Surely it'll increase tax revenue?
money would be needed to pay for JSA and other benefits for unemployed. rising (so sharply) the minimal wage would put some employers out of business.
Original post by simon_g
money would be needed to pay for JSA and other benefits for unemployed. rising (so sharply) the minimal wage would put some employers out of business.
Really?
Any evidence of that what it was introduce or risen before?
How much do you expect it to go up by?
Original post by Quady
Really?
Any evidence of that what it was introduce or risen before?
How much do you expect it to go up by?
Any evidence of that what it was introduce or risen before?
How much do you expect it to go up by?
I honestly don't know the numbers.
But, lets take food factories, quite often employing people on minimum wage (as many of the jobs require pretty much no qualification or even communicative English)- when faced with increase they (i.e. employers) would have to either automate the production line- some people would get new job, more of them would loose it- put the prices of products up (because factoring them costs more)- and they fewer people would be able to afford them- or either close factory for good or relocate it into the countries with cheaper labour. And in that scenario everyone loose (jobs, taxes etc)
Personally- I wouldn't trust any party (nor Labour nor Tories) within few months to elections
Original post by simon_g
I honestly don't know the numbers.
But, lets take food factories, quite often employing people on minimum wage (as many of the jobs require pretty much no qualification or even communicative English)- when faced with increase they (i.e. employers) would have to either automate the production line- some people would get new job, more of them would loose it- put the prices of products up (because factoring them costs more)- and they fewer people would be able to afford them- or either close factory for good or relocate it into the countries with cheaper labour. And in that scenario everyone loose (jobs, taxes etc)
Personally- I wouldn't trust any party (nor Labour nor Tories) within few months to elections
But, lets take food factories, quite often employing people on minimum wage (as many of the jobs require pretty much no qualification or even communicative English)- when faced with increase they (i.e. employers) would have to either automate the production line- some people would get new job, more of them would loose it- put the prices of products up (because factoring them costs more)- and they fewer people would be able to afford them- or either close factory for good or relocate it into the countries with cheaper labour. And in that scenario everyone loose (jobs, taxes etc)
Personally- I wouldn't trust any party (nor Labour nor Tories) within few months to elections
Thats assuming the food company's costs are almost exclusively minimum wage employee salaries. ie the 3.1% rise isn't offset by other costs like raw materials falling.
It also assumes raising the wages of those on minimum wage won't effect demand for the goods/services they produce.
I doubt a factory would be automated on the basis of a 3.1% rise. If the economic migrants are put out of work its likely they'll find another job in the currently strong jobs market, or leave the UK.
(edited 9 years ago)
Original post by simon_g
money would be needed to pay for JSA and other benefits for unemployed. rising (so sharply) the minimal wage would put some employers out of business.
First off it isn't going to rise 'so sharply', then intend to raise it to £8 by 2020. That is a rise of roughly 26p a year during the next parliament including the minimum wage increase of 20p planned by Osborne. People used the same fear tactics when Labour introduced the minimum wage, saying that jobs would disappear and and it turned out that the doomsayers were far off the mark. Some businesses might close down, but I doubt it will be a significant enough amount to do serious damage to the UK labour market. Furthermore if Osborne introduces a generous reduction in business rates in this budget and Labour continue with that policy, which they have indicated they will, the businesses most likely to be effected by rising minimum wage, i.e. small businesses, will be able to offset the rise in minimum wage with declining business rates.
Original post by BefuddledPenguin
Only by 20p but it's better than nothing. Does anyone know when this is happening, because if it's after the election it doesn't matter, as Labour want it to be £8 anyway, so it won't encourage people to vote for them, as such I'm assuming this change will be happening pretty soon.
The minimum wage increases on the 1st October each year.
The 8 pounds an hour is actually not until 2020 and actually not much better than the Tories. Even if they raised it by only 3% a year then in 2020 the Tories would have it at 7.80 or more anyway. Its just Labour making a headline.
Original post by simon_g
money would be needed to pay for JSA and other benefits for unemployed. rising (so sharply) the minimal wage would put some employers out of business.
Small businesses may not like it but at this stage in the business cycle (growth - rising consumer confidence) they'll probably be okay. Especially if they can put their employees on apprentiships.
Whilst I don't want to be labelled a scaremonger, I do feel that you've got to be careful when increasing the minimum wage. I work in the finance department of a not for profit organisation and can fully understand that small increases in the minimum wage can put a huge strain on smaller businesses. What people often gloss over is that it's not just 20p an hour, it has a knock on effect on national insurance contributions, if they're part of a pension scheme it affects the employer contribution to that.
bare in mind that tax revenue from PAYE would increase but the increase to £8 would have to come out of businesses profits thus reducing the amount of tax revenue received from corporation tax
Original post by Quady
Why would money need to be found for an £8 minimum wage? Surely it'll increase tax revenue?
bare in mind that tax revenue from PAYE would increase but the increase to £8 would have to come out of businesses profits thus reducing the amount of tax revenue received from corporation tax
Original post by blue n white army
Whilst I don't want to be labelled a scaremonger, I do feel that you've got to be careful when increasing the minimum wage. I work in the finance department of a not for profit organisation and can fully understand that small increases in the minimum wage can put a huge strain on smaller businesses. What people often gloss over is that it's not just 20p an hour, it has a knock on effect on national insurance contributions, if they're part of a pension scheme it affects the employer contribution to that.
bare in mind that tax revenue from PAYE would increase but the increase to £8 would have to come out of businesses profits thus reducing the amount of tax revenue received from corporation tax
bare in mind that tax revenue from PAYE would increase but the increase to £8 would have to come out of businesses profits thus reducing the amount of tax revenue received from corporation tax
And it'd increase NI (as you highlight) and VAT.
Original post by joey11223
Always in October so after the election, 3% rise eh, nice little handout for Osbourne, of course all you do is increase it by less the next year to balance out your "generosity".
The minimum wage has increased generously most years. Your being overly cynical.
Original post by Comeback
I suppose the point is to take the kick out of the labour policy. It should encourage people to not vote labour, though I imagine it won't be a very significant factor.
I would point out that if labour want to decrease tuition fees, rise the minimum wage to £8 and increase spending to the NHS, they have to find the money from somewhere.
Only way I see this is through taxation (countering the attractiveness of the £8 an hour), particularly the rich - the so-called mansion tax - but even that won't cover it all...
I would point out that if labour want to decrease tuition fees, rise the minimum wage to £8 and increase spending to the NHS, they have to find the money from somewhere.
Only way I see this is through taxation (countering the attractiveness of the £8 an hour), particularly the rich - the so-called mansion tax - but even that won't cover it all...
...I'm not sure how employers paying their workers more is government expenditure. Especially as this will reduce benefit payments, at least in theory.
Tuition fees will be payed by both taxing rich pensioners (who aren't really huge contributors to the economy anyway) and by the students who will pay two thirds of it; and actually will pay it under these plans, whereas under the current plans loads of graduates don't pay it.
I can understand Tory caution in increasing minimum wage but really, twenty pence is hardly going to increase public consumption so i see this as a gimmick not worth the opportunity cost of increasing production costs for businesses.
Original post by Rakas21
The minimum wage has increased generously most years. Your being overly cynical.
eh it;s what usually 2% roughly ain't it? So what Osbourne is gifting people can extra 7p, much generous, most beneficent. I mean not that I'm backing Labour, but if we're voting on that pledge then Labours claim to raise it to £8 by 2020 is more generous, as we hypothetically assume Obsbourne would pledge a 3% rise every year for the next 5, he wouldn't reach £8 (would be £7.53).
Original post by KingStannis
...I'm not sure how employers paying their workers more is government expenditure. Especially as this will reduce benefit payments, at least in theory.
Tuition fees will be payed by both taxing rich pensioners (who aren't really huge contributors to the economy anyway) and by the students who will pay two thirds of it; and actually will pay it under these plans, whereas under the current plans loads of graduates don't pay it.
I can understand Tory caution in increasing minimum wage but really, twenty pence is hardly going to increase public consumption so i see this as a gimmick not worth the opportunity cost of increasing production costs for businesses.
Tuition fees will be payed by both taxing rich pensioners (who aren't really huge contributors to the economy anyway) and by the students who will pay two thirds of it; and actually will pay it under these plans, whereas under the current plans loads of graduates don't pay it.
I can understand Tory caution in increasing minimum wage but really, twenty pence is hardly going to increase public consumption so i see this as a gimmick not worth the opportunity cost of increasing production costs for businesses.
Raise minimum wage => some businesses going out of business => lower growth => requires more stimulus to get things moving again.
Or:
business profits going down/some business closures => less confidence in economy (temporarily) => lower growth => more stimulus.
Don't get me wrong, I'm not against raising the minimum wage, but it's important we consider both strengths and weaknesses before coming to a decision (on balance we should raise it, but it will result in some negative consequences regardless).
(edited 9 years ago)
Original post by Comeback
Raise minimum wage => some businesses going out of business => lower growth => requires more stimulus to get things moving again.
Or:
business profits going down/some business closures => less confidence in economy (temporarily) => lower growth => more stimulus.
Don't get me wrong, I'm not against raising the minimum wage, but it's important we consider both strengths and weaknesses before coming to a decision (on balance we should raise it, but it will result in some negative consequences regardless).
Or:
business profits going down/some business closures => less confidence in economy (temporarily) => lower growth => more stimulus.
Don't get me wrong, I'm not against raising the minimum wage, but it's important we consider both strengths and weaknesses before coming to a decision (on balance we should raise it, but it will result in some negative consequences regardless).
Or:
Raise minimum wage => some businesses created/businesses grow => higher growth => higher profits
Original post by Quady
Or:
Raise minimum wage => some businesses created/businesses grow => higher growth => higher profits
Raise minimum wage => some businesses created/businesses grow => higher growth => higher profits
Possibly. This is all speculative I suppose.
Original post by Comeback
Possibly. This is all speculative I suppose.
Many people on minimum wage receive housing or council tax benefit to top up their wages - all pay increases have to be reported to to the council, who then reduce your benefit entitlement by the amount of your pay increase - so the worker is no better off and doesn't feel the pay rise in their pocket - but it does bring down the welfare bill (a bit ).
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