Expert Comment: MPs' pay riseMonday 16 December 2013
Dr Michael Holmes, Senior Lecturer in Politics at Liverpool Hope, looks at the furore surrounding recent proposals to give MPs a pay increase.
The row over the recent announcement that MP’s salaries are to be raised by 11% shows the extent of public disillusionment with politics and politicians. Although the pay rise has been recommended by an independent arbitration board, and although it is accompanied by a range of other measures (such as changes to MP’s pension entitlements) which will claw back some if not all of the money, nonetheless it has sparked a lot of sharp criticism.
And indeed, it should be noted that it’s not just the public who are concerned. Most politicians have expressed their reservations about the pay rise, including Prime Minister David Cameron, who called it “inappropriate”, Deputy PM Nick Clegg, who termed it “incomprehensible”, Labour leader Ed Miliband who said simply “I don’t think it’s right”, and the Greens’ Caroline Lucas who described it as “absolutely wrong”.
However, the arguments seem to have overlooked one important aspect of the debate. One of the factors considered by the Independent Parliamentary Standards Authority (IPSA), the body which made the recommendation, was a comparison with pay-rates for other jobs. They have argued that the pay rise for MPs is a means of attracting good quality people into politics, rather than heading off to earn more in other careers.
That is fine in its own terms. However, it does lead to the issue that has not been discussed – the overall wealth of those in higher-paid jobs. The problem is not just that MPs are being paid more while many ordinary employees are losing money; it is that in some jobs earnings are soaring, while in others there are sharp cutbacks. In particular, pay in some private sector firms is racing upwards at the same time as most people are seeing their real incomes slashed, creating a real problem of social cohesion that needs to be acknowledged and addressed.
This growing inequality at the heart of society is of increasing concern. It is the reason why there was an attempt last month in Switzerland to push through a referendum limiting top pay in order to prevent too much inequality. It is the reason why there has been an outcry in Ireland when it emerged that some directors of charities were earning significant six-figure sums at a time when most workers are suffering very harsh cutbacks. It is the reason why the current industrial action in universities in the UK has tried to shine a light on how pay for top management has been growing sharply while that of lecturers has stagnated.
Until the issue of appropriate maximum wages is addressed, we are running the risk of damaging the essential ‘social contract’ that holds our society, our democracy together. The issue of MPs pay is important, but it should be seen as part of a much wider debate about overall income levels and inequality gaps in society. And it needs to be seen as an issue critical to the kind of democracy we want to have.