The minimum wage is not safe in Tory hands

By Mike Ion / @mikeion

Over twelve years ago a legally-binding minimum rate of pay was introduced in Britain for the first time.

Back in 1999 all adults had to be paid at least £3.60 an hour and workers under the age of 22 were entitled to get no less than £3 an hour. The change benefited about two million people – more than half of them in the service sector – and was a noble attempt to end the disgrace of what supporters of the move called the culture of ‘poverty pay’.

Introduced by Labour and supported by the Lib Dems the bill was opposed by the Conservatives who maintained that it would add to business costs and lead to job losses.

When he was the Tory PPC for Stafford (1997) the young David Cameron told a local paper (The Chronicle) that “Labour’s plans for minimum wages, the Social Chapter and large increases in spending and taxes would send unemployment straight back up.” When he became leader in 2005 he told The Observer’s Andrew Rawnsley that “I think the minimum wage has been a success, yes. It turned out much better than many people expected, including the CBI.” Another Cameron ‘flip flop’ on policy? Not really.

Mr Cameron would never attempt scrap the minimum wage – he knows all too well that such a move would be impossible. However calling the minimum wage a ‘success’ does not mean the Tories wouldn’t make changes if they could get away with it.

Witness the recent statement by the Tory MP Philip Davies who has suggested that relaxing the present law would help some disabled people to compete more effectively for jobs in “the real world” in which they are “by definition” less productive than workers without disabilities. This needs to be added to the attempt a few years ago by a small but significant group of Tory MPs who gave their backing to Christopher Chope’s 10 minute Rule Bill that would have allowed for individuals and, de facto, employers, to opt out of the minimum wage.

According to Mr Chope giving people the freedom to opt out of the minimum wage would help not only those who are out of work but those in the hard-pressed businesses like retail and hospitality. In other words if some people (probably economic migrants) are prepared to work for less then we should allow them to do so.

Such a move would clearly be open to abuse by unscrupulous employers and would no doubt result in companies cutting wages to below the national minimum. It would hardly be hardly be voluntary when the choice would be between taking a wage cut and getting the sack to be replaced by someone who will accept lower pay. An opt out from the minimum wage would drive wages down and would probably worsen the current tension between foreign workers and British workers.

Taken together these utterances from the Tory right provide enough of an indication of the future direction of travel should the Tories ever be in a position to govern alone. The minimum wage wouldn’t be scrapped by a future Tory only government. Instead it would be allowed to wither on the vine via a series of small, insignificant and probably below inflation rises.

Is this what David Cameron means by ‘progressive’ conservatism?