To end inequality without redistribution of wealth, we should pay a living wage

Duncan Exley is the campaign director for One Society

It has been widely reported that the latest British Social Attitudes Survey found that although three quarters of the British public think the gap between rich and poor is too wide, only 35 per cent thought the Government should engage in redistribution.

Pound-coins This raises a question of how a progressive government could reduce the UK’s high, growing and unpopular levels of income inequality if the public distrusts tax-and-spend solutions.

There are two answers to that question.

The first is to recognise that although the public may not be enthusiastic about redistribution in general, they do favour redistribution away from the top one per cent. The majority of voters, including Conservatives, support the 50p top tax rate.

The popular support for the idea of reversing the rocketing pre-tax levels of top pay has also been recognised in statements by Conservative, Labour and Liberal Democrat politicians.

But progressives should also recognise that inequality at the bottom end of the income scale can be tackled at the same time as seeking to reduce spending on benefits. This could be done by focusing on the huge cost to taxpayers and the wider economy of companies which pay their low-paid staff at such levels that substantial benefit subsidies are required to make ends meet.

The cost of in-work poverty is huge: The IFS estimates that sub-living wage pay costs taxpayers £6 billion each year. If we examine the wider taxpayer cost of in-work poverty, the picture is even bleaker: child poverty costs us £25 billion each year, even though 57 per cent of children in poverty have working parents.

Politicians have been relatively quiet about the living wage recently (perhaps distracted by the staggering increases in top-end pay). This is a shame – there are certainly many more companies who can afford to pay a living wage than presently do so (we could start by looking at those who can afford to pay their senior staff unusually large amounts).

While some private sector companies pass the costs of their low pay policies onto taxpayers, some public sector employers are also complicit. For example, there is an increasing trend towards local authorities outsourcing services.

It would be helpful if public sector employers published an assessment of the full taxpayer cost of major contracts, so that “taxpayer savings” can be scrutinised, to see if they are what they claim to be.

See also:

• 50p tax: Still a Tory obsession, still not that exceptional – Alex Hern, November 24th 2011

• Inflation is worse for the worst off – Alex Hern, November 6th 2011

• Citizens UK: “The Big Society is flawed if people have to work two jobs” – Peter Carrol on Neil Jameson, October 21st 2011

• Only quarter of voters want to scrap 50p tax – Will Straw, August 1st 2011

• Tesco (profits: £3.8bn) under fire for failing to pay cleaners living wage – Peter Carrol, June 21st 2011

http://twitter.com/jonathan_barnes/status/144705509755338752 Jonathan Barnes

To end inequality, we should pay a living wage, writes @One_Society’s Duncan Exley: http://t.co/Z7LgUKp6
http://twitter.com/bevclack/status/144705636964380672 Beverley Clack

To end inequality, we should pay a living wage, writes @One_Society’s Duncan Exley: http://t.co/Z7LgUKp6
http://twitter.com/sarabryson1/status/144706011419258880 Sara Bryson

To end inequality, we should pay a living wage, writes @One_Society’s Duncan Exley: http://t.co/Z7LgUKp6
http://twitter.com/andrewsb49/status/144708186648231936 Andrew Brennan

RT @leftfootfwd: To end inequality without redistribution of wealth, we should pay a living wage http://t.co/oyTxEn6R
http://twitter.com/politicalplanet/status/144710778514182145 Political Planet

To end inequality without redistribution of wealth, we should pay a living wage: Duncan Exley argues the lessons… http://t.co/Sceo5Cbl
Anonymous

Here are some alternatives.

1. Stop taking money from the poor. The major reason that anyone is working is poor is because government takes money from them. Lots of money.

2. As an employer, you only employ someone if they make you money. They either reduce costs by more than the cost of employing them, or they produce benefits greater than the cost of employing them.

You need to decide what to do about people who are unwilling to work, and to get to the level that they are productive.

You can make people more productive if you get rid of employment taxes. They might produce the same, but the cost of employing them is lower, so the threshold is lower.

However, it doesn’t affect much the real issue. You’ve run up 7 trillion of debts, and used fraudulent methods to hide it. Now those debts are due you are racking up taxes and cutting services, and screwing the public in the process.
http://twitter.com/redvark/status/144712761472069633 Richard Hardy

To end inequality, we should pay a living wage, writes @One_Society’s Duncan Exley: http://t.co/Z7LgUKp6
http://twitter.com/aprilmorlan/status/144713303984312321 AprilMorlan

To end inequality without redistribution of wealth, we should pay a living wage: It has been widely reported tha… http://t.co/DAavlR3P
http://twitter.com/lgbtiqgreens/status/144714456952352768 Green Party LGBTIQ

To end inequality without redistribution of wealth, we should pay a living wage http://t.co/K68ogjOL
http://twitter.com/worutd/status/144715696629219328 Brian Tomkinson

To end inequality, we should pay a living wage, writes @One_Society’s Duncan Exley: http://t.co/Z7LgUKp6
http://twitter.com/therightarticle/status/144723388370395137 Michael

To end inequality without redistribution of wealth, we should pay a living wage l Duncan Exley l Left Foot Forward – http://t.co/wi5GSCat
http://twitter.com/janet_ewan/status/144724444861038592 janet ewan

To end inequality without redistribution of wealth, we should pay a living wage l Duncan Exley l Left Foot Forward – http://t.co/wi5GSCat
http://twitter.com/karenpbuckmp/status/144726369920753664 Karen Buck MP

And RT for those late up: To end inequality, we should pay a living wage, writes @One_Society’s Duncan Exley: http://t.co/Z7LgUKp6
http://twitter.com/financeforlife/status/144727930948419584 Finance-For-Life

To end inequality without redistribution of wealth, we should pay a … http://t.co/Hgv0f6aT
http://twitter.com/raintreequest/status/144727954327486464 Richard & Christine

To end inequality without redistribution of wealth, we should pay a … http://t.co/11zw7lB8
http://www.leftfootforward.org/2011/12/how-can-we-fight-child-poverty-without-hitting-peoples-pockets/ How can we fight child poverty without hitting people’s pockets? | Left Foot Forward

[...] Also: • To end inequality without redistribution of wealth, we should pay a living wage – Duncan Exley, December 8th [...]
http://twitter.com/fairpensions/status/144732608138444800 FairPensions

Also @one_society's blog on #Livingwages is worth taking a look at too: http://t.co/eOTQxqL7
http://twitter.com/rowllypowlly/status/144733275494154241 Rowland Paul Hill

To end inequality, we should pay a living wage, writes @One_Society’s Duncan Exley: http://t.co/Z7LgUKp6
http://twitter.com/nechildpoverty/status/144736173468815360 NE CP Commission

To end inequality, we should pay a living wage, writes @One_Society’s Duncan Exley: http://t.co/Z7LgUKp6
http://twitter.com/june4th/status/144743649920552960 Noxi

RT @leftfootfwd To end inequality, we should pay a living wage, writes @One_Society’s Duncan Exley: http://t.co/pszWwk8O
http://twitter.com/havantacluotmp/status/144747700355731457 Jeni Parsons

RT @leftfootfwd: To end inequality without redistribution of wealth, we should pay a living wage http://t.co/0D1MCjyP #otmp #occupylondon
Kindjourneys

Fantastic and eye-opening post, thank you. This does seem to be one area that a sensible government would have tackled ages ago. Raising the minimum wage to living wage levels, even just for larger and wealthier companies, would be a strikingly good plan. Both benevolent and helpful for the economy.
http://twitter.com/cuchulaindundee/status/144780607090733056 Alan Cowan

To end inequality without redistribution of wealth, we should pay a living wage | Left Foot Forward http://t.co/cywgOZEL
http://twitter.com/Newsbot9 Newsbot9

1. They’re spending 60%+ on housing alone. And housing benefit eclipses the tax they pay. Which is also the fault of capitalistic thinking.
2. That’s right. And businesses in your world would have to pay a LOT more to employ people, since the state will no longer shoulder externalities.

“You can make people more productive if you get rid of employment taxes”

Absolutely, you’ll need to work your peons 12 hours to get the same profit as 8, given you’ll have to pay for your kids schooling. And £2k a month for your family’s health insurance. And….

And you strongly support screwing the 99% at all opportunities, so…
http://twitter.com/fynnralph/status/144808195179823104 Fynn Ralph Hopper

RT @leftfootfwd: To end inequality without redistribution of wealth, we should pay a living wage http://t.co/ztOVjOqy
http://twitter.com/prateekbuch/status/144815379422781440 Prateek Buch

The British don't like #inequality or redistribution. Fair pay policies can help to square that circle: http://t.co/FQZ91Xfn
http://twitter.com/artsyhonker/status/144824794481827840 Kathryn Rose

References for my last tweet: http://t.co/0bZ3WMf2 http://t.co/WodbBaoY
http://twitter.com/badgers_rebel/status/144910158617780224 Bristling Badger

To end inequality without redistribution of wealth, we should pay a living wage http://t.co/iad4JMwl |#WiUnion #Occupy #OWS #OO #Capitalists
http://twitter.com/pauloquerido/status/144910303212220416 Paulo Querido

To end inequality without redistribution of wealth, we should pay a living wage http://t.co/33YFJzl9 (a pobreza custa imenso em impostos)
http://twitter.com/pauloquerido/status/144911001073098752 Paulo Querido

To end inequality without redistribution of wealth, we should pay a living wage http://t.co/33YFJzl9
http://twitter.com/toivoperson/status/144920739118727169 Toivo Hartikainen

And for more on the British Social Attitudes Survey, see http://t.co/2FKXd6nT http://t.co/1gn6V6s3 & http://t.co/50VEWm6A #BBCqt
http://twitter.com/janemoth/status/144920974666645504 Jane Lowry

RT @leftfootfwd: A living wage should be paid – taxpayers subsidise company profits via payments to support low wages. http://t.co/DGVF7Il3
http://twitter.com/adurva/status/145016887728812032 AdurVoluntaryAction

And for more on the British Social Attitudes Survey, see http://t.co/2FKXd6nT http://t.co/1gn6V6s3 & http://t.co/50VEWm6A #BBCqt
http://twitter.com/nechildpoverty/status/145155856982482944 NE CP Commission

To end inequality, we should pay a living wage, writes @One_Society’s Duncan Exley: http://t.co/R94fWiij via @leftfootfwd #ukpoverty
http://twitter.com/matthew1butcher/status/145171198488215553 Matthew Butcher

And for more on the British Social Attitudes Survey, see http://t.co/2FKXd6nT http://t.co/1gn6V6s3 & http://t.co/50VEWm6A #BBCqt
http://twitter.com/sparklytom/status/145181490572046337 Tom Milburn

To end inequality without redistribution of wealth, we should pay a living wage http://t.co/K68ogjOL
http://www.leftfootforward.org/2011/12/for-our-economic-health-we-need-a-one-off-tax-on-the-one-per-cent/ For our economic health we need a one-off tax on the one per cent | Left Foot Forward

[...] also: • To end inequality without redistribution of wealth, we should pay a living wage - Duncan Exley, December 8th [...]
http://www.leftfootforward.org/2011/12/right-wing-attacks-on-child-poverty-targets-shows-their-ignorance/ The right’s attack on child poverty targets shows their ignorance | Left Foot Forward

[...] To end inequality without redistribution of wealth, we should pay a living wage – Duncan Exley, December 8th [...]
http://www.leftfootforward.org/2012/01/inequality-must-be-ended-to-prevent-another-financial-crisis/ Inequality must be ended to prevent another financial crisis | Left Foot Forward

[...] also: • To end inequality without redistribution of wealth, we should pay a living wage – Duncan Exley, December 8th [...]
http://www.leftfootforward.org/2012/01/vince-cable-executive-pay/ Cable fails to provide a stick or carrot in the fight against obscene pay | Left Foot Forward

[...] To end inequality without redistribution of wealth, we should pay a living wage - Duncan Exley, December 8th [...]