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Trampa501

Would A £8 Minimum Wage Help The Economy?

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It appears to be the big Labour bribe.

I'm in two minds over this. On one hand I can't see how many people can survive on less over the long run.

On the other hand, many starting up in business have to survive on less, and they wouldn't be able to justify taking on staff if that figure became too high.

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Personally, we'd have to either cut staff numbers or increase our prices to the customer.

Raising the minimum wage will only cause the cost of living to increase in the short/medium term.

Reduce the cost of housing/renting and you wouldn't need to increase wages...

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Get rid of tax credits and employers will have to pay something approaching the cost of living or people won't be able to afford to take the jobs.

I used to be very much in favour of the minimum wage but now I'm not so sure. It's not employers I'm worried about - the minimum wage is a pittance and if people want to buy UK labour they should pay what it actually costs someone to work for them - with our economy's high housing costs and high living costs factored in - which is a good chunk more than the minimum wage.

But this kind of planned economy-style intervention in the market tends to have unintended consequences. Inflation has already been spiralling out of control and a move like this even risks more of it, leaving people effectively no better off anyway.

We are one of worst out there when it comes to income inequality. We need a rebalancing of incomes. Push up the minimum does nothing for people's relative poverty and wealth - we'll all still be buying the same things, but with bigger numbers on all the price tags.

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Sure, lets make sure that everybody`s got enough money to buy all the stuff that nobody can afford to make in this country any more at a cost that can compete with the slave labour rates paid in China. Are they going to bring in capital controls and punitive import tariffs too?

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The problem in the UK is that the entire system is geared to rent seeking. Anything not dealing with that fundamental problem is simply sticking a plaster on an open wound. I suspect a minimum wage rise would probably just go to the rent seekers. The Labour Party ought to be talking about social housing and tax breaks/subsidies to support industries outside of London. This smacks of a gimmick IMHO.

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It appears to be the big Labour bribe.

£8 by 2020 isn't much of a bribe. From next month the over-21 rate will be £6.50ph, so Miliband is offering a £1.50ph rise over 6 years or an extra 25 pence per hour per year. If you work a 7.5 hour day that's an extra £1.88 gross per day you'll be getting each year. Don't spend it all at once!

UK real wages are in the toilet and are likely to stay there for the next Parliament at least, largely due to housing costs.

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Personally, we'd have to either cut staff numbers or increase our prices to the customer.

Raising the minimum wage will only cause the cost of living to increase in the short/medium term.

Reduce the cost of housing/renting and you wouldn't need to increase wages...

what about instead of taxing and throwing money to inflate price floors start to make stuff cheaper; such as selling building plots for a price of agriculture land (and cancel housing benefit); or before school / after school clubs in school buildings, which cost about £60 pm like in rest of Europe

but no, let just increase taxation and waste the money anyway; ideally increase working tax credits so about 80% of working population can receive them and everybody will turn to minimal wage jobs;

BTW what these Scottish MPs have say about England? It is not their business ...

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No....encourages greater inflation/debt...repays old debt encouraging more new debt and makes whatever money held worth less.....makes us less competitive and would force more people into doing fewer hours therefore not improving quality of life but making life worse. ;)

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The problem in the UK is that the entire system is geared to rent seeking. Anything not dealing with that fundamental problem is simply sticking a plaster on an open wound. I suspect a minimum wage rise would probably just go to the rent seekers. The Labour Party ought to be talking about social housing and tax breaks/subsidies to support industries outside of London. This smacks of a gimmick IMHO.

This^^^^^

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Get rid of tax credits and employers will have to pay something approaching the cost of living or people won't be able to afford to take the jobs.

I used to be very much in favour of the minimum wage but now I'm not so sure. It's not employers I'm worried about - the minimum wage is a pittance and if people want to buy UK labour they should pay what it actually costs someone to work for them - with our economy's high housing costs and high living costs factored in - which is a good chunk more than the minimum wage.

But this kind of planned economy-style intervention in the market tends to have unintended consequences. Inflation has already been spiralling out of control and a move like this even risks more of it, leaving people effectively no better off anyway.

We are one of worst out there when it comes to income inequality. We need a rebalancing of incomes. Push up the minimum does nothing for people's relative poverty and wealth - we'll all still be buying the same things, but with bigger numbers on all the price tags.

Agreed. The way to do it is reduce taxation on lower income levels, and possibly more importantly reduce taxation on staples that most need to live on. Probably the most hard hitting taxes are those on energy, particularly fuel.

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It appears to be the big Labour bribe.

I'm in two minds over this. On one hand I can't see how many people can survive on less over the long run.

On the other hand, many starting up in business have to survive on less, and they wouldn't be able to justify taking on staff if that figure became too high.

It would just get absorbed by rent rises.

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It would just get absorbed by rent rises.

Exactly my issue with it. Costs need to be addressed, not income.

Build more social housing (to lower the HB bill/stop it propping up private rents).

Make self-building easier and reduce planning laws.

Local area rent caps tied to local incomes.

Higher wages will just = more of those wages being taken by landlords.

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Exactly my issue with it. Costs need to be addressed, not income.

Build more social housing (to lower the HB bill/stop it propping up private rents).

Make self-building easier and reduce planning laws.

Local area rent caps tied to local incomes.

Higher wages will just = more of those wages being taken by landlords.

Agreed. Labour are either stupid, or evil, in proposing this as a 'big ticket' policy. I suspect it is the latter - they know who their real bosses are and won't touch their rentier assets.

China%20-%20peoplescourt.jpg

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Build more social housing (to lower the HB bill/stop it propping up private rents).

State does not need to build anything! Just sell people building plots for the price of agriculture land. And you can cancel the housing benefit tomorrow ..

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Its not about helping the working, it is all about lowering the tax credit bill. Not a bad aim but it doesn't help anyone but the government and won't lead to lower taxes.

This proposal will have minimal effect on people without children given that it is to be brought in within the next parliament so could be five years. So that is a 30p a year increase from 2014 at £6.50. Not really much of a bribe is it.

It will have no effect on people with children as they are getting tax credits and will just lower their entitlement.

Edited by Ulfar

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Incremental minimum wage increases would probably be able to mask any kind of price shocks that would arise, this proposal won't scare the horses and is in fact in line with the increases Labour made just after its inception. They should also raise the personal allowance in line though otherwise it's pretty meaningless.

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State does not need to build anything! Just sell people building plots for the price of agriculture land. And you can cancel the housing benefit tomorrow ..

I'm not convinced self build alone will achieve the hundreds of thousands of new homes we need each year to be frank.

I think we'd get a quick surge (like we did for a few years in private house building when state building stopped) and then it would die back.

We need whole new areas/towns to pop up and that won't happen quickly without the state doing it sadly.

If it did happen without state support it's completely unprecedented.

I'm not advocating the state building homes for those on benefits either. Let them build and sell cheaply for professionals currently priced out first.

Either way since state building stopped the housing benefit bill has gone up 300%. I'd consider more houses the lesser of two evils.

Edited by byron78

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It'll only make Britain more expensive. Rising wages in a way like this will only deter investment and job creation in any industry that can compete globally.

Reducing housing, energy and other costs will put more money in people's pockets and allow us to compete better on a global scale, although that will never happen...

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Those that deserve £6 hr or less will either be unemployed or be paid £8 hr. Those deserving £10 hr will be paid £8 hr.

Same pot distributed differently. ;)

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Why not £80.

Its just a number. Completely immaterial. Zimbabweans know this.

Its not the wages that are the problem, its the cost of living. Take credit away and suddenly wages go a lot further. And it happens quickly and naturally. Between mid 08 and early 09 petrol fell from 120ppl to 80ppl as credit was withdrawn. In the US it went from over $4 a gallon to under $1.50. This would have happened in EVERY financialized market within months...it just happened fastest in oil as turnover is so quick.

But that's deflationary and doesn't support the usurious debt Ponzi that labour supports.

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i suppose given tax credits and Housing Benefit its almost cost neutral for the taxpayer as anyone on minimum wage will be receiving support.

But its not cost neutral for business. The sensible thing would be to reduce employers NI in line with the increase to neutralise it for business aswell but as Employers NI is generally a hiiden tax on tax on Labour that very few recognise theres chuff all chance of the govt reducing it.

To be fair to the coalition, i dont see how this increase is any more beneficial than increasing the tax threshhold, fortunately the popn are generally so driven by their ideology of left and right that soundbites are all politicians have to come up with, the logical and inevitable follow through of those soundbites are pretty irrelevant when the population cares about nothing more than dogma

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