Minimum Wage (Hansard, 20 July 1990)

§ Mr. Tony Lloyd
To ask the Secretary of State for Employment, pursuant to the statements of the Minister of State of 29 November 1989,Official Report, column 761, 756W concerning the Government's estimates of the cost of establishing a minimum wage, if he will state when the research referred to was conducted and completed.

§ Mr. Eggar
Work estimating the effect of a national minimum wage in the context of the social charter started in early October 1989. The estimate of the costs of imposing the national minimum wage, referred to on 29 November, became available in mid-November. Subsequently, a note on method was written, and the work continued to be under review until the end of January.

§ Mr. Tony Lloyd
To ask the Secretary of State for Employment, pursuant to his answer of 9 July,Official Report, column 98, to the hon. Member for Stretford, on the effects on pay differentials from the introduction of a minimum wage, what would be the total effects if it is assumed that differentials are restored by one half only (a) where, according to the new earnings survey and other departmental sources, more than 50 per cent. of workers in a particular industry earn between half and two thirds of national average earnings, (b) where more than half the workers in an industry are paid below the minimum wage, (c) for those earning up to two thirds average earnings and (d) in the (i) retailing, (ii) distributive trades, (iii) miscellaneous services and (iv) national and local government industries.

§ Mr. Nicholls
Such estimates could be provided only at disproportionate cost.

§ Mr. Tony Lloyd
To ask the Secretary of State for Employment, pursuant to his answer to the hon. Member for Stretford, 2 February,Official Report, column 375, on minimum wage effects, what is the estimated direct cost of raising all those to the minimum wage assumed in the note, broken down as follows: (a) industrial category, (b) region, (c) public sector and (d) private sector and the costs in each case.

§ Mr. Nicholls
This information is not available.

§ Mr. Tony Lloyd
To ask the Secretary of State for Employment, pursuant to his answer of 9 July,Official Report, column 98, to the hon. Member for Stretford, regarding the assumptions contained in the Treasury model on the demand effects of the introduction of a minimum wage (a) how many jobs will be gained as a direct result of the higher wages paid according to the simulations done for the Treasury paper, "The Relationship Between Employment and Wages" and (b) what are the estimated demand effects according to the latest version of the Treasury model.

§ Mr. Nicholls
The simulations reviewed in the Treasury paper, "The Relationship Between Employment and Wages" produced an estimate of the impact of changes in real wages on employment. This is an estimate of the net change taking into account both the effects on consumer demand of changes in real wages, as well as the offsetting effects on company sector demand which arise from corresponding changes in their costs. It is, therefore, not possible to make a separate estimate of how many jobs will be gained as a direct result of the higher wages paid.
It has not, since 1978, been the practice to run particular simulations on the Treasury model to meet specific outside requests, but the hon. Member will be aware that the current version of the model is available in the Library for Members' use.