UK to receive "living wage" by 2020 £9 per hour minimum wage.

Yesterdays budget, the first tory only budget in 18 years had some interesting and some would say bold moves.

A £9 per hour minimum wage for the over 25's may seem at a glance to be a positive step for many lower paid workers but what will the real implications of this be.

This goes alongside a cut in corperation tax to ofset the wage increases and a freeze on tax credits for the next 4 years credits for parents with more than two children will be scrapped.

The first rise comes in next year at £7.20 per hour an increase on a basic working week of 37.5 hours of £26.25 before tax an national insurance, around £18 per week after deductions.

So will this apparently positive move actually benifit those concerned or will they end up worse off?

Will the price of essential items rise due to these measures?

Will it affect you personally?

a reply to: nonspecific

They are cutting working tax credits and making business pay us better.
Looks good on paper but I suspect we will be worse off.
I saw an interview with some young adults and they are cutting housing benefit and raising university costs they sure wasn't happy.

a reply to: nonspecific In the US where separate states have raised the minimum wage and large corporations did across the board, there was no large rise in the prices of goods and small business did not go under en masse. If we had had loss of tax credits for those with children in those states, it would have hurt them.

It is now $7.25 an hour minimum throughout the country. That is not a living wage. The current bill aims to make that $12 an hour over the course of 5 years and then index it to a median wage growth thereafter. It is too little, too late I think. Tipped workers make $2.13 an hour, I knew it was low, but I just read that figure and was aghast. What happens on days there are no tips? That is like prison wages.

originally posted by: boymonkey74
a reply to: nonspecific

They are cutting working tax credits and making business pay us better.
Looks good on paper but I suspect we will be worse off.
I saw an interview with some young adults and they are cutting housing benefit and raising university costs they sure wasn't happy.

As with all budgets you have to look for the catch.

An increased wage means you pay more tax and national insurance, factor that with less tax credits and many could be worse off.

Also they plan to cap tax relief on buy to let mortgage repayments, given that most people on minimum wage are in rental properties the rise in rental costs will more than liklley put the "poor" even further behind. here's a link about that linky

Then factor in the potential increase in immigration from the EU where the benifits of a "low paid" job in the UK will be even greater for many EU residents and it's all starting to look a little hairy if you ask me.

Why not just give everyone a yearly stipend equal to a living wage? We should quit pretending any work is required for this money and just give it away. It isn't like the jobs we are talking about are skilled or even needed.

ETA: We should give everyone free school, a place to live and a car as well. Stop dancing around the issue and ask for what you really want. At least you could be honest.

The budget yesterday sounds messed up but not a surprise. Students being denied maintenance grants and their loans are reduced, which will impact on less well off students, not great for universities and colleges. The logic is forcing younger people into work or study but if there aren't the jobs how can they work.

Tax credits threshold reduction will impact many less well off families.

The wage increase is good though if there aren't the lower paid jobs available how is it really going to affect many. The lower paid work often is taken by immigrants instead of previously being a market for students and unskilled workers.

Some of Conservative policies I agree to though this budget has revealed a mean streak that might well lose them many votes among the young and less well off.

originally posted by: Metallicus
Why not just give everyone a yearly stipend equal to a living wage? We should quit pretending any work is required for this money and just give it away. It isn't like the jobs we are talking about are skilled or even needed.

Some would say that we already do that in the UK.

The issue has been manipulated in the media as a justification for the cuts they have just announced.

a reply to: Metallicus

Not needed? many minimum wage jobs are jobs in care that look after people.
Not needed is it?
Tell you what do one and go and live in the woods away from society eh? This concerns the British and you have to come in and have a go about about something you have no clue about.

a reply to: theabsolutetruth

I suspect the businesses may just cut hours for people.
Lets see If zero hour contracts continue.

a reply to: boymonkey74

I think many people both in the UK and abroad would be suprised at the kind of job that pays our current £6.50ph minimum wage.

It's not just socially useless teenagers in MCdonalds on this rate of pay as you say, care workers and qualified chefs are two that spring to mind.

a reply to: nonspecific

Yeah including me (just above) I just hate it when people go all elitist and stuff bleating nonsense.
Got my goat up when he said jobs like mine are not needed.

a reply to: boymonkey74

I wouldn't be surprised. It might fuel an increase in zero hour contracts which is also counterproductive.

7.20 pound an hour would at least bring you guys into the Australian minimum 'full time' wage. A 'full time' wage in Australia means your guaranteed 38 hours hours a week, even if the boss can't physically supply it. Plus you get 10 days payed sick leave a year and 2 weeks payed holiday and also can't be fired without 3 written warnings.

The casual minimum wage in Australia is 20.50 AU an hour (or 10 pound). 'Casusual' just means you lack the entitlements a full time job has.

imo, any country that pays there workers less than 15.30 US an hour without entitlements, is a disgrace to civilized society.

a reply to: nonspecific

The Devil is in the detail , with the other cuts working families will likely be no better off , if he wants a living wage why not implement the current one which will help hard pressed working families now rather than a promise of jam tomorrow.
If he really wanted to help working people why not cut VAT down to 15% , I'm sure that would do more to help now rather than a promised £9 ph in 5 years.

I think this budget is more to do with Osborne positioning himself for the upcoming Boris vs George Battle for the Tory leadership contest.

Beware a Tory bearing gifts.


Here's what the Living Wage Foundation had to say on the announcement.

We agree with the Chancellor that work should be the surest way out of poverty. However, this announcement raises several important questions.

“Is this really a Living Wage? The Living Wage is calculated according to the cost of living whereas the Low Pay Commission calculates a rate according to what the market can bear. Without a change of remit for the Low Pay Commission this is effectively a higher National Minimum Wage and not a Living Wage.

“Secondly, what about London? We have been working with the Mayor of London for seven years and there’s a London Living Wage rate that recognises the higher costs in the capital, currently £9.15 per hour. These changes will not help the 586,000 people for whom even the 2020 rate announced today would not be enough to live on now.

“Thirdly, what about the 2 million under-25s who are not covered by this announcement? To make sure workers in London and those under 25 do not lose out, we call on employers to join the group of 1,600 organisations that have already chosen to become voluntary Living Wage employers.

“And, lastly, do the tax credit changes announced today mean that the Living Wage needs to be higher to make sure people have enough?
www.livingwage.org.uk...

Happy to hear on the cut of child allowance for over 2 children sick of my taxes paying people to breed.
If up to me Id scrap the whole thing, want kids save up for them.

I just don't understand the British and American people.

Especially Americans! They rant on about how important there stupid feeble minded gun rights are, yet they happily allow there government set the minimum wage at a pathetic 7.20US an hour. I mean seriously dudes, don't you have any respect for yourselves.

Us Aussies don't mess around with our workers rights. we expect a hard days work will always be compensated with a fair days pay.

Just ask our second longest standing prime minister what happens when you try messing with our workers rights.... half a million people protesting all across the country. That's equivalent to nearly 7 million Americans protesting, all at the same time.

Minimum wage should be 15 US dollars an hour (or 10 pound an hour) in all civilized countries, any one who disagree's is a total tool.... or just a pawn to TPTB.

Have some respect for yourselves people! Stand up for your rights as a significant entity.

a reply to: Subaeruginosa

Well call me a tool if you must but here's a possible outcome of a £10ph minimum wage in the UK.

That would mean an increase of £3.50 per hour across the board not just for miumimum wage, everybody would need a wage increase of £3.50 to maintain a pay structure.

In order to accomadate this large companies would have to increase to cost of goods and services to accomodate this OR move there operations overseas to take advantage of cheaper labour in other EU nations.

Everybody would pay more tax and national insurance(20 tax, 11% NI).

Many small business's would no longer be able to compete leading to yet more monopolies by an elite few companies.

Even greater increase in EU immigration to take advantage of higher wages.

I am not sure this is what I would like to see happen.

a reply to: nonspecific

That doesn't make any sense, imo.

Why would providing the lower class with a livable wage, need to automatically result in a pay rise for the the rich & middle class?

a reply to: Subaeruginosa

So if you had a worker on £6.50 an hour and a supervisor on £10 an hour and you increase the workers rate to £10 per hour then how will the supervisor feel about getting the same rate of pay but more training and responsibility?

The supervisor will need to be paid £13.50 an hour to maintain the pay scale obviously.

And so will his manager and so forth.

If everyone at the bottom gets the same rate of pay then your verging on communism.

a reply to: nonspecific

Fair enough.... I'll concede that a supervisor deserves to be on a higher rate than the workers he is charge of.

But can you concede, that all workers deserve a livable wage? Which is imo, at least $15 US ph (or 10 pound ph)