Guest Post by Rob Clarke
I had an idea about reform and I wanted to share that with you, I hope you’re reading it now. The idea is about how we all get paid and more importantly how we should all get paid. This headline idea is that everyone, whether they are working or not should be entitled to a living wage. This is not the slightly higher minimum wage re-brand that was introduced earlier this year. It’s a proper living wage. A wage for everyone working or not. Paid to you by the government.
Take a step back for a moment and look at our current method the general populous get’s it’s money and if you’re in employment it works a bit like this in simple terms:
Your employer pays you a bit of money and also pays the government a bit of money. You get the net result of what your contract says you’re paid, less that bit which is paid to the government to keep the system running.
If you’re not working, the simple view is:
You inform the government that you are not (able to be) working and the money you get comes from the government coffers instead of your employers.
I want to change this, rationalise this and pay everyone a standard living wage. Calculate this as a headline figure based on a 40 hour week, which can be advertised and scrutinised. You see, employers already pay money to the government, the shift here is that more money gets paid to them from businesses and the state is then able to pay it back to you through a living wage credit.
Okay, you’re with me so far and that’s great but by now I’m sure you’re already picking holes in this idea. Stick with me… Not everyone is paid the same about of money.
That’s right. Employers already accept a cost to their businesses by giving you a job. They take the work you do and give you money in return. The type of job you do and the skills required to do that job, tend to mean that you get more money or lots more for doing it. As an employer, there’s that tax contribution to be paid to the government on top of the reward you get in your pocket for your hard work.
I’m talking about changing the split between what the business pays you and what it pays the government. Any money that your job rewards (over and above the living wage), would be paid direct to you from your employer. The employer would then pay two components to the government. A living wage reimbursement and a tax charge for your supplementary salary.
Every period you would receive two lumps of money in your hand. One from the state (the living credit) and one from your employer (your employment credit).
What about those who don’t have / can’t have a job?
This grand reform enables everyone to receive the living wage. Whether you are working or can’t work. The living wage must be pegged at level that provides a good standard of living for everyone. It should then be paid to everyone because basic decency dictates that everyone is entitled to a good standard of living.
What about the sick?
This living wage will need to be topped up for those in special need, that goes without saying. The reform would keep benefits for the most needy in society.
People still get benefits then?
Some will, yes. Of course they will, but living wage will replace much of the bill that we get hit over the head with at the dispatch box during the budget speech. Benefits/Allowances and the costs they rack up in administering them will be swallowed up by the living wage bill and it’s administration.
What about the lazy?
What about them and why are you using such a negative phrase? Oh, you mean those who are happy to sit back and live on the living wage, not go out to work? That’s what the living wage is for. If you can’t live on it then it’s not fit for purpose.
There will be many reasons why people choose not to go to work. Raising a family is one and that certainly isn’t being lazy. The living wage should be for everyone, to allow you make the choice to work or not to work. This is an overly simplistic idea, from a simple man on the street. I’m no economist but I welcome any discussion on this idea.
The biggest paradigm shift of this idea is the concept that you get paid enough money to keep you and your family happy without having to go out and work for it. People will still work, they will choose to do so rather than be forced to.
If you’ve reached this far, thank you take the time to read my ramble. I hope it made sense or gave you pause for thought.