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Minimum wage should rise but not at the cost of jobs, says George Osborne Minimum wage should rise but not at the cost of jobs, says George Osborne
(about 9 hours later)
George Osborne has struck a cautious note about increasing the minimum wage, warning it would be "self-defeating" if it cost people their jobs.
In his first intervention in the recent debate, the chancellor said he would like to see an increase in the minimum wage but dampened speculation that there could be a big inflation-busting rise from the current rate of £6.31 per hour.
There have been reports that the Conservatives are considering a rise of more than 50p an hour in a move that would steal some of Labour's thunder on the issue, after Ed Miliband promised his party would introduce an increase if it won the next election.
On Wednesday Sajid Javid, a Tory Treasury minister, said there was a "strong case" for an increase, and sources said Iain Duncan Smith, the work and pensions secretary, was among the senior cabinet figures pressing for a big rise.
Conservative support for the policy has been driven by Matthew Hancock, a former chief of staff to Osborne and business minister, who has lined up with Jo Johnson, the Downing Street policy board head, and Oliver Letwin, the Cabinet Office minister and prime ministerial aide, to make a break from the Tories' original opposition to the minimum wage in the late 1990s.
In response, Liberal Democrat sources have accused the their coalition partners of once again attempting to steal their policies, after Vince Cable, the business secretary, urged the low pay commission last September to move towards restoring real-terms rises in the minimum wage.
However, Osborne appeared to play down the idea of a big rise on Thursday, saying it should not be allowed to jeopardise the economic recovery.
"I think everyone wants to see an increase in the minimum wage, I'd like to see an increase in the minimum wage but it has to be done in a way that doesn't cost people their jobs because that would be self-defeating," he said during a visit to a garage in north London.
"We have the low pay commission as a body that exists to make exactly that judgment and what we've got to do as a country is get that balance right between supporting business, growing our economy and making sure it's a recovery for all and that is what our long-term plan is all about delivering."
He was visiting Enfield to highlight a policy coming into effect in April that will allow businesses to claim £2,000 a year off their national insurance contributions.He was visiting Enfield to highlight a policy coming into effect in April that will allow businesses to claim £2,000 a year off their national insurance contributions.
Ryan Shorthouse, director of the Tory modernising thinktank Bright Blue, told the Guardian last month that Downing Street should focus on a "balanced, moderate message", including an increase in the minimum wage, rather than trying to "outdo Ukip" on immigration. Ryan Shorthouse, director of the Tory modernising thinktank Bright Blue, told the Guardian last month that Downing Street should focus on a "balanced, moderate message", including an increase in the minimum wage, rather than trying to "outdo Ukip" on immigration.George Osborne says he would like to see an increase in the minimum wage, but that it would be self-defeating if a big rise cost people their jobs.
In his first intervention in the recent debate, the chancellor struck a more cautious note than some of his colleagues, as speculation grew that there could be an above-inflation increase to the rate of £6.31 per hour.
His comments follow reports that the Conservatives are considering a rise of more than 50p an hour to steal some of Labour's thunder on the issue, after Ed Miliband promised to introduce an increase if he wins the next election.
On Wednesday, Sajid Javid, a Tory treasury minister, said there was a strong case for an increase, and sources said Iain Duncan Smith, the work and pensions secretary, is among the senior cabinet figures pressing for a big rise.
Conservative support for the policy has been driven by Matthew Hancock, a former chief of staff to Osborne and business minister, who has lined up with Downing Street policy board head Jo Johnson and the Cabinet Office minister and prime ministerial aide Oliver Letwin to make a historic break with the Tories' original opposition to the minimum wage in the late 1990s.In response, Liberal Democrat sources have accused the their coalition partners of once again attempting to steal their policies, after Vince Cable, the business secretary, urged the Low Pay Commission last September to move towards restoring real-term rises in the minimum wage.
However, Osborne appeared to play down the idea of a rise on Thursday, saying it should not be allowed to jeopardise the economic recovery.
"I think everyone wants to see an increase in the minimum wage. I'd like to see an increase in the minimum wage," he said during a visit to a garage in north London.
"But it has to be done in a way that doesn't cost people their jobs because that would be self-defeating. We have the Low Pay Commission as a body that exists to make exactly that judgment and what we've got to do as a country is get that balance right between supporting business, growing our economy and making sure it's a recovery for all and that is what our long-term plan is all about delivering."
He was visiting the Enfield business to highlight a policy coming into effect in April that will allow businesses to claim £2,000 a year off their national insurance contributions.
Ryan Shorthouse, the director of the Tory modernising Bright Blue thinktank, told the Guardian last month that Downing Street should focus on a "balanced, moderate message", including an increase in the minimum wage, rather than trying to "outdo Ukip" on immigration.
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