Give MPs a 10% pay rise... and give Britain one too

David Cameron is reportedly determined to stop MPs from getting a 10% pay rise.

And you can be sure that this is true because he has strained every nerve and sinew in largely trying to replicate such wage restrictions across the country.

He may once have uttered the phrase “it’s time Britain had a pay rise”, but, tellingly, he far more frequently speaks of “competitiveness”, “restraint” and “responsibility”.

And he would at least be consistent here if he hadn’t also been busy printing money and handing it to bankers via a £375billion quantitative easing plan.

Unfortunately, very little of this vast sum has been passed on to the wider economy through business loans, which have continued to decline.

Meanwhile, firms are also sitting on enormous cash reserves – £284billion, according to Bank of England estimates – and are shying away from investing because there isn’t enough demand for the things they produce.

Why? Because, apart from the richest 1%, who have seen their wealth double in five years (and, like the banks, also hate parting with their cash for anything other than useless vanity projects and tax dodging), most incomes have fallen in real terms.

So, instead of thrusting yet more cash at the most tight-fisted corporate institutions in the land, why not give MPs a pay rise – and the rest of Britain too.

With negative inflation, record low interest rates and growth having plunged to 0.3% last quarter, there is more than a little room for the government to top up individual accounts instead of putting money straight in the banks’ own vaults.

Give money to the people who will actually spend, rather than those who prefer to stash, and provide our economy with the much-needed boost it has long been denied.

Henry Ford, who doubled the wages of his employees so that they would buy his cars, understood this concept – as do the two-thirds of economists who agree that austerity has harmed the economy.

I’m not particularly sure MPs deserve to earn more than the £67,000 they currently do, but that is beside the point.

Expecting everyone to suffer frozen and barely rising incomes just because we do is counter-productive. We need to act together.

Of course, the Tory government are unlikely to spend money on taxpayers in this manner, because, apart from going against their oft-trotted false claim to fiscal responsibility, they appear to be actively pursuing a low-wage economy and deepening income inequality.

Why else would they be so happy to encourage the spread of zero-hour contracts, massively raise worker fees at employment tribunals and clamp down on collective bargaining practices by attacking on trade unions?

The “miracle” George Osborne claims to have wrought on the economy is one of rhetoric not reality. The Tories have cleverly crafted a series of illusions.

In the jobs market, we have the illusion of rising employment with the government increasingly subsidising low-paid workers with in-work benefits while employers (often Tory donors) feel little compulsion to dent their own soaring salaries.

Middle class voters have the illusion of prosperity by ensuring at all cost that the goose of rampantly rising house prices keeps laying its golden eggs.

Minimum-wage workers have the illusory promise of being lifted out of income tax, while the government takes a swingeing axe to the services and benefits they rely on.

Lastly we have the illusion of fiscal probity while the debt is rising and vast sums of money are gifted to the wealthiest via tax cuts and quantative easing.

Yet the solution to Britain’s problems is staring Mr Cameron in the face: take the pay rise, pass it on and finally make good on a promise that “we’re all in it together”.