Friday, July 17, 2015

MP pay - is it really too difficult to read the whole story before engaging outrage mode?

Yes, it seems.


Oh, you want me to say more than that. Right. Ummm... let's see. Wait a minute, it's on the tip of my tongue...

Featured on Liberal Democrat VoiceIn my day job, I spend my time examining all of the available data in order to define any areas of doubt and uncertainty and then, having done so, work out a fair and rational way of dealing with them. It is surprisingly enjoyable, especially as you learn more about human nature and about how people organise, and rationalise, their lives. You get to meet interesting people and get a sense of their worlds.

So, it would be odd if I spent five minutes looking at one particular piece of data, and drew my inferences from it alone, ignoring all of the rest. And yet, people seem perfectly willing to do just that when it comes to politics, politicians, and how our country is run.

Let's take MP salaries as an example. They have been awarded a 9.26% increase in their basic salary by IPSA, the independent arbiter of what an MP should be paid, as well as the rest of their package. 9.26%, or about £7,000, that's an outrage, right? In isolation, it is a lot of money, especially given the pay restraint to be applied to the public sector (and it amazes me the level of ignorance about that too, but that's a different story, for a different day perhaps).

Of course, it isn't the whole story. The personal contribution towards their pension will be increased, and the resettlement allowance for MPs who are not re-elected has been axed and replaced with a rather less generous 'loss of office' allowance only to be paid to MPs who fight their seat and lose - think of it as redundancy money, as paid to a lot of people when they lose their job. And there are other, reasonable reforms such as the abolition of the food subsidy currently payable if the House sits after 7.30 p.m.

The overall additional cost to the taxpayer? Nothing. Nada. Zip. Heavens, even the Civil Service paybill is increasing by 1% per annum.

There are some elements which might be questioned. Why, for example, should it right for future increases to be linked to the growth in average earnings, when the public sector will be pegged to something rather lower than that if the Government's own figures are to be believed?

But that isn't a cause for outrage particularly, especially if future increases are linked to those of average employees. It provides a realistic incentive to spread the benefits of economic growth rather more widely, even if taking the median figure for pay growth might be more credible than the mean.

Unfortunately, most people will read the first sentences of the story and never bother to get to the end. Indeed, attention spans seem so short now that getting to the middle appears unrealistic. It does not augur well for an intellectual renewal if our body politic, does it?...

4 comments:

Suedehead said...

It is also worth mentioning the fact that MPs haven't had a pay rise for a few years. There will never be a good time for MPs to get a pay rise but, the longer they accept a pay freeze, the larger the catch-up will be when they eventually do get a rise.

Of course, some MPs don't exactly do themselves any favours when they try to justify the increase. For example, here is a story from my local paper.

http://www.bournemouthecho.co.uk/news/13424012.I_never_expected_to_be_watching_the_pennies_at_my_age__Read_Tobias_Ellwood_s_plea_in_support_of_MPs_pay_rise/?ref=mr&lp=3

Anonymous said...

Of course, teachers (to take but one example) have seen their personal contribution to their pension scheme rise significantly in recent years (and will rise more) while seeing their return on that investment slashed.

Strangely, they were not compensated with an inflation busting pay rise to make up for it.

Mark Valladares said...

Suedehead,

I do also think that the arrangements for MP pay and expenses have become gruesomely complex, as allowances have been granted to disguise pay rises. Transparency requires a simplification of the pay arrangements, yet ill-directed outrage makes that much more difficult.

Let's simplify things so that it is crystal clear what an MP really earns. Then, and only then, can we have an informed debate about their remuneration package.

Mark Valladares said...

@ Anonymous,

Absolutely right, and I have written elsewhere about the impact of public sector pay restraint on staff morale, recruitment and retention. As a twenty-eight year veteran in the Civil Service, I earn less now than I did in 2007, pay more towards my pension and expect something rather less than gold- plated when I retire.

The impact of Government policy on its employees is a cause for outrage, but MPs are hardly taking it in.