Contrary to chancellor George Osborne’s confidence in the economy’s ability to afford a rise in minimum pay – revealed last week – some food business leaders believed it could burden the sector.
David Williams, Butt Foods md, told delegates at the central London forum yesterday (January 21) a rise from £6.31 an hour for over-21s to £7 an hour, could cost it an extra £40,000–£50,000 annually.
Loss of jobs and business
He said if the potential 10% rise in minimum pay was implemented, it would definitely cause a loss of jobs and business at the SME level.
“The chancellor is saying he, potentially, would like to see minimum pay brought up to £7 an hour. Well it’s the Low Pay Commission’s [LPC’s] job to decide, they will look at it and analyse the market and decide what the right thing to do is. But the government is interfering in that.”
Former Premier Foods chief operating officer Geoff Eaton also aired concern over government interference.
Right business environment
“They [the government] need to concentrate on making sure the environment for business is right. Something like the minimum wage is critical for small businesses,” he added.
Eaton said he was a fan of the Tax Credit as a way of helping to top-up incomes of the lower-paid and said he did not think businesses, which were competing on an international stage, should be “disadvantaged” by a 10% rise in minimum pay.
He added that the government should leave businesses to concentrate on generating growth, which should be facilitated through good macro-economic policy and cutting regulation and red tape.
Business Leaders’ Forum
The Business Leaders’ Forum, staged in association with law firm Stephenson Harwood, was sponsored by Agrantec, Intertek, Tata Consultancy, plus insurance firm Aon, Columbus IT and NSF International.
Watch out later this week for more news, including video interviews, from the event staged yesterday (January 21) in central London.