Teen beauty spot drinkers are ramblers, not rebels
- Dave Burrows
Letter: Minimum wage rise could price us out of market
Tuesday 3rd January 2012, 7:51AM GMT.
Regarding Oliver Healey’s letter that the minimum wage should be £8.75 per hour. I welcomed the minimum wage as before some people were working for £2 an hour, but let’s not price ourselves out of the market.
Firms will take the work abroad – where the wages are lower – if the minimum wage gets too high.
With the employment laws we now have, you cannot sack people like you could years ago, so you could end up paying £8.75 per hour for a poor worker.
It could be more affordable to pay workers overtime rather than take new people on.
A number of firms in Shropshire have already moved to China and India.
Tom Brazier
Trench
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You’re darn tootin’!
If we want to compete with the BRICs we better start paying BRIC wages.
I like how Globalisation will ultimately result in everyone on the planet earning exactly the same wage lest they lose their job to another country that under-cuts them.
If we’re going to share out the money, we’ve got to share it out globally. Sure, you’ll be worse off, but someone on the other side of the planet will be better off. It’s a sort of swings v roundabouts on a entire human life scale.
It’s not so much we’re all Middle-Class as we’re all Communists now !
Except me, naturally. I’ll be ski-ing in Aspen with Ptolemy and Jocasta and observing with an air of detachment.
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Rather than increasing the minimum wage, which may indeed price us further away from the market norm, a better idea would be for the government to stop taxing people on the minimum wage.
It is scandalous that people on MW have to pay over a chunk of their meagre earnings in tax and NI. The fact that they may get it back in various credits and benefits is a bureaucratic nonsense, adding £billions onto the backs of companies who have to administer the tax, NI and credit system as well as creating a credit system so complex that even HMRC has been unable to design software that can effectively keep up with it, leading to pay-outs which they have then tried to reclaim, blighting peoples’ lives and creating misery for them.
Everyone should be entitled to a earn their first £15,000 tax and NI free. (If successive governments had not frozen the tax-free point, we would nearly be there now, rather than stuck at the current £6,475.) After that, they start paying tax at standard rate.
It sounds a big jump, but look at the bigger jump that people have had to made in payments for fuel, heating, COUNCIL TAX, and the like. The money that the government loses from such a move could be recouped by shedding the credits system which should also be drastically cut back.
Companies would be incentivised to take on (or even retain) more “lower-paid” workers, knowing that they could employ them without the burden of NI payments needing to be calculated and as tax would not kick in before the £15,000 mark, many, many workers would find themselves much better off, yet on the same salary as before.
Simplify everything – make things efficient.
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“Rather than increasing the minimum wage, which may indeed price us further away from the market norm, a better idea would be for the government to stop taxing people on the minimum wage.”
What an excellent idea.
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Hi Rodney, As a accountant I have to point out that its not 6475 you can earn before tax, its ACTUALLY 7475, and has been for a while!
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Thanks Kt; took the figure from a Google search of HMRC webasite but must have ended up on an older version.
£7475 it is then – about £143 a week, still scandalous to tax people earning at these low levels.
As an accountant, could you let us know how much money per week someone on minimum wage would earn, assuming a 40 hour week, standard allowance, single person and no other income / benefits?
Thank you.
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“Everyone should be entitled to a earn their first £15,000 tax and NI free”
Here Here!!!
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Erm, it’s ‘Hear hear’…
I believe there is currently a proposal that those on £10,000 per annum or less should pay no tax. The threshold should and could be higher, but unfortunately Mr Cameron is too ken on paying massive subsidies to his friends the wealthy in th form of tax loopholes, so we can’t afford it.
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The sheer cost of housing fuel heating public transport etc is enough to discourage industry from staying in Britain.High wages are essential if the workforce is to have any chance of a decent standard of living.£8.75ph is not that much compared to the basic cost of living.
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Too right Ian 10 pounds a hour is nearer the mark i would say.
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i suppose my hourly rate of £29 for working new years eve is above average then. its a shame that out of a dozen other employees i am the only the wanted the work.
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And i have said i am putting my prices up from £28 phour to £33, i will never moan again.
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But the basic cost of living will also increase as every item we would buy, whether from a loaf of bread to a new car, would be dearer because of the salary increases. And I bet the earnings to expenses ratio wouldn’t narrow but get wider too.
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There would be no inflation if the change was only to the tax-free allowance.
Prices rise (speaking generally) when businesses have to raise more money to pay for increases such as salary. Raising the minimum wage would be an extra cost and *may* create some inflation, but raising the allowance means that companies are not affected at all – indeed, their administration burden diminishes – and so there is no need for them to raise prices on account of raised salaries.
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If you pay decent pay you will get better work from your workforce if you earn minimum wage and your company makes millions in profit then to increase peoples wages is surely fair in the same way that when times are hard they ask to cut hours or pay but this will never happen as with the increase of housing costs 2 people earning the minimum wage will be hard pressed to get a mortgage or rent a private let which in shropshire 500 pound a month rent is quite standard which will make our young have to move away for cheaper housing.
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Of course if we raised the minimum wage we would price ourselves out of many contracts.
However i am an employer and see where the letter writer is coming from , however the uk is rather an expensive place to live and yes it would be rather nice to have forced labour working for £5 an hour because that is what it would be , but are we going backwards and in turn becoming a backward country with those who have and those who have not , personally i have a strong desire to leave these shores as this country is going one way and one way only.
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Mr brazier, I take it you are not on minimum wage or you would welcome the proposal. Do you fear for the economy or do you want to keep paying (most) hard working people the equivilent of peanuts in the current climate??
If you want to try to save money, ask the politicians if they are still claiming clandestine expenses, as was the case two/three years ago. They should be the ones sorting it out instead of sorting out their personal bank balances!
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Rubbish.
The taxpayer already subsidises low wages via the tax credits system.
The lower the minimum wage, the higher the bill for the rest of us while big companies offshore go to all lengths to avoid paying tax on their tidy profit.
Socialism for the corporations, the rough end of the capitalist stick for the rest of us!
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Spot on arthur!
Board romm pay up 1000% plus over the last fifteen years – the minimum wage up barely 200%… and you wonder why the rich are getting richer and we are heading towards voting in some real nutters – POLITICIANS WAKE UP!!!
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I believe Oliver Healey has a good idea that should be enforced. Raising the minimum wage would encouarage people to look for work therefore reducing the countrys unemployment. I also beleive in reducing VAT by 2 and a half percent to further assist the purcahse of items such as cars. I understand the drawbacks associated with raising the minimum wage but I am confident the pros outweigh the cons.
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If firms move to India that will be very inconvenient. You fill your trolley in Tescos and then have to push it 8000 miles to the checkouts.
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Thanks for your contributions: On the English National Wage we need to see our big companies implement it. We need to implement it sector by sector job by job. On Small Companies Corporation Tax we should reduce it from 20% to 5% for all companies that make profits of less than £5m. Companies first £875,000 of profit would be tax exempt. This would invest in success, invest in jobs and stimulate growth. Take Tough Action with the Banks, the tobacco monopolies and the Oil and Energy Giants. Cut Taxes, abolish Employer’s National Insurance Contributions for small companies, Cut Business Rates and Raise Wages. We need to reverse cuts in corporation tax for big companies, eliminate tax avoidance and tax evasion and put consumers back onto the high street profit back into companies and jobs to the jobless and spending power back into household budgets. We need to reduce the stealth taxes on Fuel in the long term, abolish the Climate Change Levy and simplfy the tax system. Commercial Aviation receives a £7bn subsidy in excise duty free Aviation Fuel if that was taxed at the same rate as Road Fuel we could reduce fuel tax bringing down living costs and inflation. The Country is in severe economic difficulty and that’s why we need to rebuild our economy not on debt but on rising wages, fair business taxation and sensible government.
Though its titled English National Wage it does cover Wales, Scotland, Northern Ireland as well as England. I am only 23 years old but I have been involved in political campaigns for 5 years and wanted to improve the working conditions of my fellow citizens. epetitions.direct.gov.uk/petitions/20357
PLEASE FORWARD TO Friends and get them to sign it.
Yours Sincerely
Oliver Healey
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You have said it all in your last paragraph,
” I’m only 23 Years old”
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John are you being ageist now on top of all your other prejudiced views?
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Oliver may be only 23 years old, but he has presented more facts in this one post than you have ever presented in all of your posts the the Shropshire Star. You may disagree – but you present no facts at all to support your views.
Which of you is behaving more like a grown up here?
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Tosh,
If you have a modern, efficient industrial business then labour is such a small constituant part of the overall cost. If you think that we should be paying third world wages to compete with the third world then something is clearly wrong in your thinking. If you can only compete on price/cost then you should get out of that market, because you will always be beaten.
What this nation needs is a ground up rethinking of its business plan for the next 20-30 years. We don’t want to be competeing for commodity business, we want to be a high tech, forward thinking, inventive, high margin product nation.
Minimum wage for 40 hours a week only gives a salary of about £11k per year. Who can afford to bring up a family on that once tax and national insurance is taken into account. We don’t need to raise the minimum wage however, what we need to do is suppress the import of cheap labour, this will have a market led effect on wage increases through supply and demand. Of course no body wants to work for minimum wage cleaning toilets, but if the cheap labour import was suppressd then they might clean toilets for £10 per hour. Cutting unemployment and cutting the benefits burden.
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