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9 October 2021

We should pay MPs more – but only if they earn it

If we linked MPs’ pay to household incomes, they might think twice before voting to make the poorest households poorer.

By Jonn Elledge

On Wednesday 6 October, as Boris Johnson stood on a stage in Manchester and promised to introduce “big generational changes” that had been “shirked” by his predecessors without bothering to outline a single policy, his government was busy slashing benefits back to the lowest level since 1990. The removal of the £20 a week uplift to Universal Credit, introduced to support those on the lowest incomes through the pandemic, will mean taking more than £1,000 a year from 4.4 million households. It will affect 8.6 million people, including 3.5 million children, a group who by definition have absolutely no agency to affect their family’s financial situation. Just as inflation hits its highest level since the financial crisis, Rishi Sunak’s Treasury has decided it’s the right moment to deprive a million households of a 10th of their income, overnight.

Keep all that in mind, as you consider that this was the week a senior Tory backbencher decided to tell the New Statesman that MPs needed a pay rise, because living on a salary of just £81,932 was “grim”. “I take the view that being an MP is the greatest honour you could have,” Peter Bottomley told the NS Britain editor Anoosh Chakelian. “But a general practitioner in politics ought to be paid roughly the same as a general practitioner in medicine.”

In fact, he argues, the complications of MPs’ lifestyles – two homes and so forth – means they should actually be paid more. The average GP salary in England is £100,700: to attain a similar standard of living, Bottomley argues MPs should be paid £110,000-115,000. At the moment, they are struggling along on a mere two and a half times the average income. As to his junior colleagues, “I don’t know how they manage,” he says.

I don’t want to go in too hard on Bottomley, who comes across as a decent, thoughtful sort, and who takes the view – distinctly unfashionable in the contemporary Tory party – that the job of a MP is to help people. (He even thinks the Universal Credit cut should have been introduced more gently, though, strikingly, he doesn’t speak forcefully against it.)

And we do have a bad habit in this country of talking about public sector wages in a vacuum, as if the salaries of those who work for the state can be agreed without reference to those salaries of those who don’t. In reality, of course, the ridiculous salaries paid at the upper end of the BBC are driven by the even more ridiculous ones on offer from commercial broadcasters; if you insist that public wages should be kept down, but private sector ones allowed to soar away, the inevitable result will be a drain of people, talent and ideas from state to industry. This may at first glance seem less of an issue in parliament than in some of the more technical bits of the civil service, but it’s a concern nonetheless.

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So let’s run with Bottomley’s idea, and consider the possibility that MPs should be paid more like GPs. What would that actually look like?

In 2004, the Blair government introduced a new GP contract, which promised to reward family doctors – most of whom are, technically, private contractors – based on how much work they did. The new system paid practices set amounts, based on how many patients they had and how much care those patients needed. In addition, it included a sort of bonus scheme, the Quality & Outcomes Framework, in which they would receive extra money for hitting certain targets (screening for particular conditions, say). This, ministers thought, would give them a mechanism for driving improvements.

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The result of all was a massive unplanned pay rise, of 30 per cent or more, for many GPs, followed by some mild political panic because this wasn’t supposed to have happened. Family doctors were simply a lot better at hitting those targets than ministers had expected. Financial incentives, it turned out, worked.

Could a similar system be used to encourage better performance among MPs? The Demos chief executive Polly MacKenzie has suggested linking MPs’ pay to the amount of work they actually do, to encourage participation in debates or select committees or the holding of weekly constituency surgeries.

There is a precedent for this – it’s not a million miles from how local councillors are paid – but I wonder if it’s over-complicating things. Perhaps we should instead simply link MP pay to household incomes, so that they only get richer when the public gets richer, too. How might we define those incomes – mean, median, minimum? Well, that would rather depend on what we hoped to achieve.

Such performance-related pay might provide a useful deterrent to the sort of complacency about flagging household incomes that too many MPs have shown over the last decade. At the very least, they might think twice before voting to make the poorest households poorer.