George Osborne finds moderate approach that benefits all without destroying economic progress
3 min read
20 March 2015
While higher rises would have been difficult to deal with, the increase in minimum wage contained within the chancellor's Budget speech is the right move.
I have written long and often about my concerns over proposals to drastically increase the minimum wage, the confusion of the Living Wage campaign. However, I absolutely 100 per cent applaud George Osborne for his decision to set a rise of 20p an hour on the minimum wage from 1st October this year.
Stagnation was out of the question – cynics would say out of the question for an election win – but the country does need to know things are changing for confidence to grow. There is a need to enable wages to rise and for business to thrive.
The business community has done its best against the odds to respond to the Tory plea to lead the country out of recession. Contrary to Labour’s predictions, the private sector has picked up much of the public sector cut unemployed. As always, we need to take the lead now and show our belief that better times are here to stay.
This was not some madcap figure. Osborne got it right. Higher rises would have been totally untenable for businesses to find. Nor is the impact one that can be dismissed as inevitably more skilled labour will not appreciate being neglected and paid a figure nearer to one more junior so wage demands are likely to be more universal. It is a findable figure for most businesses, however, one that should not massively impact on numbers employed, as is the danger of some large and more immediate figure. Businesses have time to forecast and budget accordingly.
Nor do I believe it will sky rocket inflation at that level. It will bring welcome extra money to the lowest paid who, according to the Office of Budget Responsibility, are already £900 better off than in 2010 due to the chancellor’s policies – as opposed to Labour. Because businesses have been set an attainable target, there will be no need for sudden mass increase of prices across the board. The government is also doing its bit – by upping the level of personal allowances; again, not by a huge amount, but it is all steps in the right direction.
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Osborne has actually followed a moderate approach that benefits all without destroying the hard paid for economic progress. No wonder Milliband doesn’t like it and is having to resort to cheap jibes that Osborne won’t be believed. Die hard us-and-them hating Labour followers believe a Tory chancellor on principle but for the moderate, facts, figures and extra money in the pocket at a price that all can afford is excellent news and totally credible.