I’ll level with you: I’m not a massive fan of George Osborne.
My distaste for the Chancellor of the Exchequer stems partly from his politics and partly, I regret to say, from his face.
While some people are eternally smiley and I once had a colleague who looked permanently puzzled, Mr Osborne has one of those faces where the default setting seems to be a sneer.
Mr Osborne’s facial sneer has often seemed a good match with his politics, yet this week I found myself thinking “good work, fella” in response to at least one part of Mr Osborne’s budget.
Chancellors have to achieve two things in a budget: (1) make people think they’re going to be better off and (2) get in enough money to run public services.
Those two factors are essentially in conflict so the trick for Chancellors is to highlight the bits where you’re giving people something and hope they don’t notice the bits where you’re taking away.
So Mr Osborne gave to business by signalling a reduction in corporation tax but took away by introducing a mandatory living wage. That living wage was a boost to the low paid but they will also face cuts to working tax credits.
Much has already been said about the living wage announcement, with the CBI and the Federation of Small Businesses among those warning of its impact on small firms.
But here – and I am really having to force my fingers to type these words – I agree with Mr Osborne.
The living wage is defined as the hourly rate a worker needs to earn to cover the costs of living. Any firm that pays below that level is saying either that they don’t want their staff to have a basic standard of living or that the state should be subsidising their enterprise. Either way, it’s indefensible.
So I applaud Mr Osborne and can only find fault with that particular part of his budget by saying that £7.60 an hour is not the living wage (it’s currently pegged at £7.85), and there is no good reason why under 25s should be left out.
Covering budgets for then a decade has taught me that nobody really knows what they actually mean until some time later. Either through things hidden in small print or the law or unintended consequence, the true impact of measures announced by the bloke with the red box are often felt months down the line.
But on face value this will be a measure that will improve morale, reduce absenteeism and enhance productivity. The cost of not doing it far outweighs the negatives.
- Graeme Whitfield is business editor of The Journal