‘National minimum wage 25 years on: Here’s how we made history in office’

“Success has many authors, failure is an orphan”, often comes to mind when I’m asked about the minimum wage. I know the introduction of the national minimum wage was probably my greatest achievement in office – I was the Secretary of State in the Department of Trade and Industry (DTI) who steered the bill through parliament and cabinet – because so many other people list the minimum wage as their greatest achievement in office.  

But it’s not untrue; there were many people throughout the Labour Party, trade union movement and other organisations who played a role in establishing the national minimum wage, not least Chris Pond and the Low Pay Unit.  

Two who come to mind when thinking about the campaign for the minimum wage are Alan Fisher of NUPE (one of UNISON’s predecessors) and his deputy, Bernard Dix. Alan put in the legwork to establish the case within the union; his successor, Rodney Bickerstaff, took up the cudgels and eventually won over others in the trade union movement (there was a fear that a minimum wage could undermine union differentials and collective bargaining). 

Their research and arguments were persuasive, but also, during the Thatcher governments, pay for some was so appallingly low, it became almost impossible for those in the trade union movement to argue against setting a national minimum. Having a minimum became a moral imperative.

Tory arguments against the minimum wage lost their power

John Smith, as Shadow Chancellor, took the proposal seriously and accepted the argument that Labour should adopt the policy. Establishing a national minimum wage was in our 1992 manifesto.

The Conservative Party, at the time, told everyone that it would cost two million jobs. The press also warned of the catastrophic consequences we would face following its introduction. But we stuck with the commitment through John’s leadership and, when Tony Blair became leader, he, and Gordon Brown as Shadow Chancellor, renewed our commitment to its introduction. 

By the time we approached the 1997 election, the Conservatives were still trying to claim that the minimum wage would be a disaster but, by this point, with their economic reputation in the doldrums, the public sector crumbling and with so many cases of horrifically low pay, the Conservative government had lost its credibility; their arguments had lost power and persuasiveness. 

Even some employers didn’t believe the Conservatives’ claims. I had a sense that there were a number of employers who were offering ‘acceptable’ wages and wanted their employees to have a decent standard of living. They were getting sick of being undercut by bad employers, paying a pittance.

Real enthusiasm for the policy across the labour movement

The introduction of the minimum wage was in our 1997 manifesto and in our first Queen’s Speech. Hearing the Queen say “My government are committed to fairness at work and will introduce a national minimum wage” was quite the moment. A policy that so many had worked on, for so long, was actually in a Queen’s Speech. 

Ian McCartney, MP for Makerfield (1987 to 2010), deserves so much of the credit for the establishment of the minimum wage. Ian and his team worked assiduously on all the policy detail and preparation while in opposition. Work he then carried through into government, as minister of state in the DTI. 

While, as a government, we were committed to the establishment of the minimum wage, there were some disagreements over the detail and implementation, and there were some occasionally heated discussions behind the scenes. I had to make the political arguments to steer the policy detail, which Ian had worked so hard on, through cabinet and parliament. It was a genuine joint effort between us to get the policy through, and I don’t think that we could have done it without each other.

While the behind-the-scenes detail-wrangling was key to its establishment, it should in no way detract from the very real enthusiasm there was for the policy across the labour movement. We all know that the Labour Party is a broad church, and this was one of those occasions where we were all singing from the same hymn sheet. 

That enthusiasm impressively carried over into a readiness to get stuck into the detail. Members of Parliament weren’t just willing to serve on the bill committee, they were genuinely keen. I still speak with former MPs who are so proud that they served on that committee and played their part in bringing in the minimum wage. 

An example of the good a Labour government can do

An unusual, but crucial, element was the ‘buy in’ we had with the establishment of the Low Pay Commission – having a combination of unions, business and academics working together to recommend the minimum wage levels gave the minimum wage a solid foundation. It has been key to its survival – with that level of ‘buy in’ (and success) it would be ‘brave’ for a party to go into an election with a policy to abolish it. 

We can see in George Osborne’s rebranding exercise with the ‘living wage’ an attempt to try and claim some authorship for his party. Success really does have many (bogus) authors.

However, the absolute measure of success is in those who saw an immediate benefit to their lives and their standard of living and those who have benefited from it since. We should never lose sight of the significance, or importance, of its introduction. 

In parliament, I cited the examples “a homeworker paid as little as 35p an hour, a cleaner paid £1.30 an hour or a security guard paid £2.35 an hour—and bring your own dog!”. The establishment of the minimum wage wasn’t just ‘good politics’ – it was the right and decent thing to do. As we approach the next general election, we should never lose sight of the example of the good a Labour government can do.

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