Opinion: 'Living wage hypocrisy'

By John Tennant - UKIP Candidate for North East Region 2014 EU Elections

Chuka Umunna, one of the rising stars of the discredited UK Labour Party and one of the loudest voices on the Living wage debate has been revealed to have unpaid staff which have been involved in campaigns on his behalf. Utter hypocrisy, how can a very well paid MP with generous lifestyle benefits, be allowed to recruit staff without offering some form of pay get away with pretending to stand up for the poorest workers in our country?

Mr Umunna was even asked a direct question on Sunday Politics as to whether he pays his own staff at least minimum wage, his answer was a clear 'yes', but in actual fact he took on staff at his Streatham constituency and his Parliamentary Office with only 'lunch and travel expenses' pay. Let us be frank - he lied.

The debate surrounding a 'living wage' is the heart ruling the head. I fully understand the moral argument that everyone who is in work should receive a fair share of the return for their hard work. How do we define that? Labour believes that we should increase minimum wage and offer business a tax rebate of between £445 to £1,000. The problem here is the bureaucratic nightmare involved, surely in order to calculate every tax rebate for the many thousands of different businesses that apply, the cost of doing so would perhaps render the whole scheme implausible, even that Brownite Chancellor in waiting; Ed Balls in 2010 was quoted: "It seems to me that there would be a substantial extra cost either to the exchequer or to business."

The result of which is an even smaller pool of tax revenue from which to repay our national debt, in fact if such a plan is mishandled as many tax schemes are; we may even need to borrow more money, thus increasing our national debt.

There are plenty of ideas floating around the debate on tackling low wages. Perhaps we should look at it from a different angle. Why are some wages low? Why are some wages not a 'living wage'? Should we try a more free market approach? Maybe we need to look at tax itself, particularly income tax. I do not think it is fair to tax all workers, regardless of earnings. In fact I think low paid workers would be better off not paying income tax at all, that way they get 100% of what they work for. Giving them better spending power, and taking the regulatory burden away from small businesses, this in turn would help small businesses stay in existence and be able to continue to employ workers.

If we take Labour's plan, it in fact adds further paperwork for applications for the tax rebate, which adds more cost to the business, rendering the rebate practically pointless. The reason some wages are seen as 'low' is because they do not provide the spending power of those workers, remove the tax burden and they will be able to prosper. In a free market you cannot distort wages through regulation, that is when you end up with the disparity of earning power between the classes, and generally end up with a divided society. In order to ensure fairness, we must free up those on lower earning power from tax, and those on higher earnings to pay a fair share of income tax. That is the free market approach, that is how we create a 'living wage'.

Mr Umunna should be more circumspect in his policy arguments, you cannot call for fair wages yet employ staff without real pay. You also cannot create a living wage by adding more regulatory rules. By decreasing regulatory burdens, we can create greater economic activity, for everyone.

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