Why is a ‘national living wage’ not a Living Wage? George Osborne’s recent 2015 Budget proposal for an increased statutory Minimum Wage rate gave it a new name, cleverly stealing the Living Wage ‘brand’ with its high recognition and positive campaign profile and attaching it to his lower level minimum wage combined with reduced tax credits. Politicians may snigger about clever wheezes — after all, the brand isn’t copyright — but this theft matters because it deliberately risks causing further suffering on top of what Osborne’s dysfunctional ‘austerity’ is loading on millions of poor people, the majority of them in paid work. How? By defying the social science evidence of what’s needed for decent living, by devaluing language to victimise poor people, and by setting falsely low targets. If total household incomes from earnings and benefits are reduced, the suffering poverty causes will be increased.
The social science evidence on which the campaigning concept of the Living Wage is based is clear, but it’s complicated. As a reflection of survey evidence, the Living Wage is in fact a semi-technical term used to describe research findings on the minimum level of earnings at which an average family can just afford to buy what the UK population says everyone needs in order to have the opportunities and choices necessary to participate in society. Put aside the prejudiced language and political cant the government uses about poor people — this is what all ‘hardworking families’, everybody, should have the resources to choose. This isn’t based on a narrow poverty line but a minimum income standard at an inclusion level. It takes complex calculations to get from the empirical research which the Centre for Research in Social Policy at Loughborough University (CRSP) carries out on a regular basis, funded by the Joseph Rowntree Foundation (JRF). CRSP surveys what the UK population considers is the variety of necessities for minimally decent living for everyone, then subjects them to expert scrutiny, and costs them in fine detail. That gives a factual basis to the complex calculations of hourly earnings rates needed, allowing for variables such as housing and transport costs in different parts of the UK, the number and status of the household members, and for the household income balance between earnings and taxes and benefits based on political decisions. That final figure of the sum needed by households of varying size and composition is what matters, not the earnings alone. ‘Living’ means freedom to choose the real, socially inclusive life which the UK population reports as the decency minimum for everybody.
Politicians have no competence to change scientific language which has a specific understood meaning. Of course they play Humpty Dumpty with the meaning of words, but when they do it to change scientific meanings for ideological reasons, that’s much more serious. Working people who find Mr Osborne’s standards for ‘living’ inadequate risk being blamed themselves for not coping when the real culprit is Mr Osborne. Symptoms of ‘not coping’ are among Mr Duncan Smith’s wrongly asserted causes of poverty. George Orwell described this abuse of language in his dystopic novel of life in 1984 as ‘Newspeak’, designed “to make all other modes of thought impossible …. by the invention of new words, but chiefly by eliminating undesirable words and stripping such words as remained of unorthodox meanings, and so far as possible of all secondary meaning whatever”. Thus when busy media journalists and unaware publics hear Mr Osborne refer to his ‘national living wage’, he wants them to think it is the real thing now adopted nationally, when in truth it is nothing more than an empty party political propaganda device at a lower level. It’s straight out of Orwell’s ‘1984’.
Ignoring scientific evidence, changing the meaning of technical terms — and setting false targets. The third of Mr Osborne’s subversive attacks on the basic idea of income adequacy is revealed in a throwaway remark in his budget speech that the government’s target for his pseudo-living minimum wage is to reach 60% of median earnings. The fine detail matters less than the ‘Newspeak’ objective of making people think that the adequacy of minimum incomes is always a fixed percentage of some index of income distribution and that is always sufficient. But there is no a priori reason for supposing that 60 or any other percentage ever represents what the population considers household income adequacy according to its own standards, in the past, now, or in the future. The source of this percentage choice is presumably one of the UK government’s four ‘official’ poverty measures, set at 60% of equivalised household income before or after housing costs. But this originated as an arbitrary expedient EU and OECD social indicator devised for cross-national reporting and comparison but not to measure income adequacy empirically to meet different populations’ varying minimal decent living standards. As a campaigning tool for raising incomes it represents a milepost but not a goalpost, good for showing how far you have got but not for where you should get to. In reality, empirical poverty research in the UK 2008-15 has shown that 60% of median household incomes has always been too low to reach the UK population’s own estimate of minimal adequacy for families.
Defenders of Mr Osborne’s confusion between a quantitative distributive percentile and a qualitative standard of living could point to the widespread use of the 60% median as a poverty measure, including by some social scientists. But they are using the conventional government measure (which many seem to believe is the only relative one, when all poverty measures without exception are relative to something — time, place, culture, observer) for milepost comparative reasons, not as ‘Newspeak’ targets as Mr Osborne is. He is insidiously trying to persuade the public that the minimum household earnings and incomes needed for decent living are less than the UK people say they are, and that adequacy will be achieved at levels far below whatever the research itself finds. Whoever first said it, Mr Osborne is entitled to his own opinion about the minimum cost of decent living, but not entitled to his own facts.
The author: John Veit-Wilson is Emeritus Professor of Social Policy of Northumbria University, a guest member of sociology staff in Newcastle University, and was a founder member of the Child Poverty Action Group in 1965.