Guy Opperman: the Conservative case for a living wage

For too many people in our society, a hard day’s work no longer means a fair day’s pay.

As a Conservative MP, I believe that lower taxes stimulate growth and jobs, that smaller government is invariably better government and that governments must “ensure that work always pays” by making sure those in work are better off than those on benefits. I also believe in hard work. Yet, for too many people in our society, a hard day’s work no longer means a fair day’s pay.

Ever since the financial crash of 2008, the topic of “pay” has been dominated by the pay of those at the top. From golden hellos to golden handshakes, the discussion has often ignored those at the bottom. I sit on the advisory board of the High Pay Centre, alongside the Green MP, Caroline Lucas, and the TUC general secretary, Frances O’Grady. At the High Pay Centre, we have been making the case for corporate responsibility and pay restraint in the boardroom. It is now time for us to make the case for fairer pay at the bottom, too.

Britain is a country in which some workers earn so little that the government has to step in and provide aid. That is the system of tax credits we have; a subsidy by any other name and a £4bn one at that. How and why did we let it become acceptable for a full-time job not to pay enough to live on? The living wage isn’t just a wonkish idea – it’s the political world catching up with many Britons’ reality.

When the national minimum wage was adopted in 1998, many were sceptical. The fear was that it might hit the number of jobs available. There is ample evidence to show this is not the case. For instance, in 2012 the Institute for Social and Economic Research at the University of Essex studied the minimum wage and “found almost no evidence of significant adverse impacts on employment”. Today, the minimum wage is supported by all three mainstream parties and rightly so. Yet, for many, the minimum wage does not represent a fair wage.

There are some who have the same scepticism about the living wage – that it could penalise business and hold back growth. It may just be the old socialist in me but when did it become a hindrance rather than a duty for a business to look after its employees? The days of William Armstrong and Joseph Rowntree building houses for their workers and ensuring a decent standard of living may belong in a bygone age but surely some of those principles should still apply?

Some businesses already embrace the principle. In the US, the wholesale retail giant Costco has broken the mould: it pays its staff $11.50 an hour (£7.50), compared to the federal minimum wage of $7.25 (under £5). Costco’s chief executive, Craig Jelinek, made the point succinctly: “We know it’s a lot more profitable in the long term to minimise employee turnover and maximise employee productivity, commitment and loyalty.”

Businesses and organisations that have committed to paying the living wage include everyone from the big corporate beasts such as Deloitte and Barclays to Aquila Way, a housing association in Gateshead, north-east England. I have met with some of these accredited firms and they all talk of improved morale and productivity. One firm increased staff retention in one department by 65 per cent.

If those on the right won’t listen to the arguments of an old left-winger such as me, then, at the very least, they should listen to the HR director of Barclays, Dominic Johnson, who says “it makes sense for business”. The living wage doesn’t just work for business, it makes sense for the government, too. IPPR and the Resolution Foundation have found that even if only those employers that could easily afford to – the so-called “non-low-wage employers” – paid the living wage, the savings to the Treasury each year would be in the hundreds of millions. This would be the result of increased tax receipts, increased National Insurance contributions and savings on benefits such as tax credits.

Yet even enthusiasts have to accept that there remains a lack of detailed analysis of the effects of a living wage on individual sectors. I will be working hard to ensure that the government takes seriously the conclusions of the Living Wage Commission, chaired by John Sentamu, the Archbishop of York. It is vital that we monitor the economic effects of the living wage and demonstrate the benefits and the negatives of paying a living wage.

David Cameron was right when he said that here “is an idea whose time has come”. The living wage started off as a belief and became a campaign. It is now time for us in Westminster to return to our constituencies and make the case for our individual businesses to start paying the living wage.

Guy Opperman is the Conservative MP for Hexham

A London bus. Photograph: Getty Images.

This article first appeared in the 12 August 2013 issue of the New Statesman, What if JFK had lived?

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Grandpa was ill and wasn’t keen on climbing the volcano – but we forced him up all the same

I squinted. Apart from a gleam of turquoise, the view was of one big cloud. Slowly the words started to form in my head. Just. Like. Scotland.

At first, Grandpa was sceptical about the volcano. “I used to be into that kind of thing,” he said, “but not now.” He did not mention that he was 88.

The guidebook to Indonesia – which he disdained – described how, once you got to the crater, the mist would rise to reveal a shimmering lake. His fellow travellers, my sister and I, often joked about our family’s tendency to declare everything to be “just like Scotland”. This was a living, breathing volcano. It would be nothing like Scotland.

But as Grandpa reminisced about his childhood in the Dutch East Indies, he began to warm to the idea. We set off at 7am and drove past villages with muddled terracotta roofs and rice paddies spread across the valleys like glimmering tables. We talked excitedly about our adventure. Then it began to rain. “Perhaps it will blow over,” I said to my sister, as the view from the windows turned into smears.

Our driver stopped at a car park. With remarkable efficiency, he opened the doors for us and drove away. The rain was like gunfire.

To get to the crater, we had to climb into an open-sided minibus where we sat shivering in our wet summer clothes. Grandpa coughed. It was a nasty cough, which seemed to be getting worse; we had been trying to persuade him to go to a pharmacy for days. Instead, we had persuaded him up a cold and wet mountain.

Five minutes passed, and the minibus didn’t budge. Then another bedraggled family squeezed in. I thought of all the would-be volcano tourists curled up in their hotels.

“Look,” I said to the attendant. “My grandfather is not well. Can we please start?”

He shook his head. “Not till all seats are full.” We exchanged a glance with the other family and paid for the empty seats. The driver set off immediately.

The minibus charged up a road through the jungle, bouncing from puddle to puddle. Grandpa pulled out his iPhone and took a selfie.

The summit was even colder, wetter, rainier and more unpleasant. We paid a small fortune to borrow an umbrella and splashed towards the lake. My sister stopped by a fence.

“Where is it?” I said.

“I think . . . this is it,” she replied.

I squinted. Apart from a gleam of turquoise, the view was of one big cloud. Slowly the words started to form in my head. Just. Like. Scotland.

I thought remorsefully of the guidebook, how I’d put my sightseeing greed before my grandfather’s health. Then I noticed the sign: “Danger! Do not approach the sulphur if you have breathing problems.”

Grandpa, still coughing, was holding the umbrella. He beckoned me to join him. I didn’t know it then, but when we made it back to the car, he would be the first to warm up and spend the journey back telling us stories of surviving the war.

But at that moment, in the dreich rain, he gave me some advice I won’t forget.

“If anyone tells you to go and see a volcano,” he said, “you can tell them to fuck off.” 

Julia Rampen is the editor of The Staggers, The New Statesman's online rolling politics blog. She was previously deputy editor at Mirror Money Online and has worked as a financial journalist for several trade magazines. 

This article first appeared in the 23 March 2017 issue of the New Statesman, Trump's permanent revolution