So Vince Cable, the Business Secretary, is at it again. Somehow this man twists logic in on itself in a way that would leave Steven Hawking at a loss to explain. Perhaps reflecting some dark, inner turmoil over serving in the most right wing government in history while continuing to harbour fantastical delusions about being able to press a nuclear button to destroy the evil Cleggeron, Vince has today announced a tiny increase for people on the national minimum wage - just 11p per hour, taking it to the princely sum of £6.19 per hour from 1 October. (The current assessed Living wage, by contrast, is £7.20 per hour outside London, £8.30 in the capital.)
That's if you're old enough to have the "key to the door", as Vince's Mum probably told him would be his 21st birthday present sometime back when young people knew their place. Because Vince reckons that, if you are younger than that, you should work for less, even if you are doing the same job just as competently as older people.
So much less, in fact, that this year, in spite of high inflation and cuts to tax credits, he reckons young minimum wage earners should not have an increase at all. So, if you are aged 16 or 17, your £3.68 per hour rate stays put; and if you are 18 to 20, it remains at £4.98. (Apprentices, who the Government makes much of creating lots more, will see a whopping rise of 5p per hour to as much as £2.50!).
Now, this differential is not entirely Vince's fault. The Nu-Labour regime of Messrs Blair and Brown created the differentials when they introduced the national minimum wage (NMW). They even introduced legal exemptions to the laws against age discrimination to allow lower rates of NMW to be paid to younger people.
This was and remains really counter-intuitive. Employers can discriminate legally against younger people as long as they keep workers on the national minimum wage. As soon as they pay them any more than that, the exemptions no longer apply and they have to pay all ages the same or they can be sued for age discrimination. Quite rightly too, I say - except that this provides unscrupulous employers with a justification for keeping their lowest paid workers on the NMW.
Vince of course could be sweeping this ludicrous arrangement aside. He could be telling employers that if 19 year old is doing the same job as a 21 year old, they should be paid the same rate. Why on earth not? Would we accept such a distinction between a man and woman any more? Or a white person and an Asian? It is rightly illegal to pay older workers less - you can't differentiate between a 40 year old and a 75 year old. So why is it ok to pay young people less to do the same?
And why on earth has Cable made the gap 11p per hour worse? Well, here is the really twisted logic...
He claims it is to prevent young people being uncompetitive in the workplace and stifling job creation. How so? How can the very lowest rate of pay of all be uncompetitive? Who would be able to outbid them? And what employer would not create a real job because it was going to cost another £4 or so per week to pay? Only illegal gangmasters and ruthlessly exploited Chinese cockle-pickers come to mind. Is this really the sort of economy the Coalition is benchmarking its employment policies against?
In the Budget this week, the Lib Dems are hopeful that they will finally gain their nirvana of a £10,000 p.a. tax allowance for workers. Very nice - it will deliver an across-the-board tax reduction to everyone earning above the current tax allowance threshold of £8,105 per annum. So millionaires will be better off by the same amount as someone earning dead on £10,000 p.a.
However, with a pay rate of £3.68 per hour, working say 40 hours per week, a 17 year old on the national minimum wage has an annual pay of just £7,655 p.a., so will not benefit at all - and in real terms their paltry earnings will in fact buy even less as prices rise. Their employers, meantime, with both the rise in tax allowance and likely abolition of the upper tax rate for earnings over £150,000 p.a., look set to be quids in.
The other week in the Guardian, as he prattled on in some sort of mysterious way about some mild disagreement with Nick Clegg, Cable reveled suitably self-effacingly yet still sickeningly smugly in the faux appellation of the Karl Marx of the Lib Dems. What a load of twaddle. This grandee of social-lite liberalism is more Groucho than Karl when it comes to Marxism, his social concern worn as shakily as the bleeding-heart-on-his-sleeve.
Still, at least once he is out of government post-2014, when he picks up a job working the aisles in age-enhanced-friendly B&Q, Vince won't need to worry about being undercut by some young upstart racing up from the glue section.
That's if you're old enough to have the "key to the door", as Vince's Mum probably told him would be his 21st birthday present sometime back when young people knew their place. Because Vince reckons that, if you are younger than that, you should work for less, even if you are doing the same job just as competently as older people.
So much less, in fact, that this year, in spite of high inflation and cuts to tax credits, he reckons young minimum wage earners should not have an increase at all. So, if you are aged 16 or 17, your £3.68 per hour rate stays put; and if you are 18 to 20, it remains at £4.98. (Apprentices, who the Government makes much of creating lots more, will see a whopping rise of 5p per hour to as much as £2.50!).
Now, this differential is not entirely Vince's fault. The Nu-Labour regime of Messrs Blair and Brown created the differentials when they introduced the national minimum wage (NMW). They even introduced legal exemptions to the laws against age discrimination to allow lower rates of NMW to be paid to younger people.
This was and remains really counter-intuitive. Employers can discriminate legally against younger people as long as they keep workers on the national minimum wage. As soon as they pay them any more than that, the exemptions no longer apply and they have to pay all ages the same or they can be sued for age discrimination. Quite rightly too, I say - except that this provides unscrupulous employers with a justification for keeping their lowest paid workers on the NMW.
Vince of course could be sweeping this ludicrous arrangement aside. He could be telling employers that if 19 year old is doing the same job as a 21 year old, they should be paid the same rate. Why on earth not? Would we accept such a distinction between a man and woman any more? Or a white person and an Asian? It is rightly illegal to pay older workers less - you can't differentiate between a 40 year old and a 75 year old. So why is it ok to pay young people less to do the same?
And why on earth has Cable made the gap 11p per hour worse? Well, here is the really twisted logic...
He claims it is to prevent young people being uncompetitive in the workplace and stifling job creation. How so? How can the very lowest rate of pay of all be uncompetitive? Who would be able to outbid them? And what employer would not create a real job because it was going to cost another £4 or so per week to pay? Only illegal gangmasters and ruthlessly exploited Chinese cockle-pickers come to mind. Is this really the sort of economy the Coalition is benchmarking its employment policies against?
In the Budget this week, the Lib Dems are hopeful that they will finally gain their nirvana of a £10,000 p.a. tax allowance for workers. Very nice - it will deliver an across-the-board tax reduction to everyone earning above the current tax allowance threshold of £8,105 per annum. So millionaires will be better off by the same amount as someone earning dead on £10,000 p.a.
However, with a pay rate of £3.68 per hour, working say 40 hours per week, a 17 year old on the national minimum wage has an annual pay of just £7,655 p.a., so will not benefit at all - and in real terms their paltry earnings will in fact buy even less as prices rise. Their employers, meantime, with both the rise in tax allowance and likely abolition of the upper tax rate for earnings over £150,000 p.a., look set to be quids in.
The other week in the Guardian, as he prattled on in some sort of mysterious way about some mild disagreement with Nick Clegg, Cable reveled suitably self-effacingly yet still sickeningly smugly in the faux appellation of the Karl Marx of the Lib Dems. What a load of twaddle. This grandee of social-lite liberalism is more Groucho than Karl when it comes to Marxism, his social concern worn as shakily as the bleeding-heart-on-his-sleeve.
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| Celebrity Come Shelf Stacking - Cable can still see off these young dudes |
Still, at least once he is out of government post-2014, when he picks up a job working the aisles in age-enhanced-friendly B&Q, Vince won't need to worry about being undercut by some young upstart racing up from the glue section.
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