The question arises from James Graham’s excellent blog on how raising the personal income tax allowance, a central plank of Liberal Democrat influence in the Coalition, makes it more likely that large companies will pay fairer wages.
James was responding to Zoe Williams in the Guardian (well worth a read), who rightly highlights the negative societal impact of companies paying their employees wildly differing amounts – sky-high executive salaries at one end of the spectrum, and sub-living wages at the other that have to be topped up by complex and costly welfare spending.
Of late there has been a great deal of coverage of extremely high pay, and bank bonus season will undoubtedly keep said payments firmly under the microscope. Rather less has been made of the payment of wages that aren’t sufficient to attain a decent living standard, and the illogical system of meagre compensatory handouts it necessitates.
So the question again is: if we want to see fair wages at the low end of the spectrum, what’s the best mechanism? Exhorting companies to ‘play fair’ (also known as tilting at windmills in some circles…)? Making the tax system more favourable to low earners? Giving employees a greater say in how companies are run? Legislating for a living wage?
In reality of course it’ll take a mix of the above, and possibly other measures, to secure fair wages for all – how do you, the esteemed LDV reader, think the Liberal Democrats should approach fair pay?
* Prateek Buch is Director of the Social Liberal Forum and serves on the Liberal Democrat Federal Policy Committee