Would paying more attract a better calibre of MP? The evidence suggests not

Higher pay would tempt to parliament the low performers of high paying professions, thus pushing out high performers of lower paying professions

casrtoon

 

MPs caught plotting ‘under the radar’ lobbying (on behalf of clients) for cash, are quick to use their mischiefs as an excuse to lobby (on behalf of themselves) for even more cash.

They claim if MPs were paid more we would get better quality MPs, asserting that:

  • Some high powered people don’t apply to be MPs because they don’t want to take the pay cut.
  • If they didn’t have to take the pay cut, they could become high powered MPs.

Let’s put aside the copious evidence that the existing rewards of being an MP are sufficient to pull in a plentiful number of people who consider themselves ‘high powered’: Oxbridge graduates are just one per cent of the population but made up 27 per cent of all MPs, and over one in three of Tory MPs, in the 2010-15 parliament.

oxbridgegraph

And let’s overlook that there are many high powered MPs in parliament who do the job for reasons of public service, regardless of the pay. Just as there are many high powered people with vocations to work in other relatively low paying professions.

Instead focus on that group of people who refuse to be an MP unless the money can match that of their alternative employment.

For those who measure a person’s merit by their pay:

1) merit is measured by how much they earn.
2) the amount earned is only a measure of their merit within their profession, and not across professions.

For example, if a banker earns more than a doctor that is not because the banker is ‘better’. It is because the banker is in a higher paid profession than the doctor. Just as the thousandth ranked UK banker earned more than a million euros, while the thousandth ranked tennis player earned just a few thousand.

Therefore using money as the measure, to get the ‘best’ we would want people paid in the top quarter (above the 75th percentile) of earnings for their profession.

A look at wage figures for different professions from the Office for National Statistics (ONS) illustrates that by paying MPs more we would actually get a worse quality of MPs. Higher pay would tempt to parliament the low performers of high paying professions (bankers; lawyers; lobbyists) thus pushing out high performers of lower paying professions (teachers; IT managers; nurses…).

The graphs below show the range of salaries for different professions. First we explain how the graph works:

graphexplain

  • 25 per cent earn less than the first blue block, marked Q2 (the second quartile)
  • 50 per cent earn less than the second blue block, the median.
  • 25 per cent earn more than the third blue block, marked Q3 (the third quartile)

For a selection of professions, salary ranges (from the Office for National Statistics, table 14.7a) are:

employeequintile

Evident from this is the fact that the current MP’s salary, £66k, is already above the 75th percentile for postmen, nurses, teachers, IT managers and train drivers. So an MP’s pay is already enough to get the top 25 per cent talent from those professions.

earnings

On the other hand, £66k is well below the pay of a 75th percentile lawyer, doctor, or company director.

lawyerpay

Even the MPs’ 10 per cent payrise in May 2015, to £74k, still wouldn’t be enough to bring in the best money driven candidates from these high pay professions.

To attract money-driven top 25 per cent (top quartile) lawyers, doctors, and company directors, the salary of an MP would need to rise to £100k. This is clearly ludicrous:

a) Based on market driven supply & demand, there has never been a shortage of people wanting to be an MP. Whether they are any good is a matter of opinion.
b) The statistics show the vast majority are sheep, voting according to the party line.

voteagainstownparty

One possible solution:

1) Parliamentary candidates state in their election campaign literature how much money they need for it to be worth their while representing their constituents, signed off by the party leader.

2) The party leader is given a salary budget after the General Election of £67k times the number of MPs he gets. (ONS figures for 2013 show £67k p.a. is more than 94 per cent of income tax paying Britons’ pre-tax incomes). And it is left to the party leader to share this out.All done in full public view. Now that would be fun to watch!

pretaxincome

34 Responses to “Would paying more attract a better calibre of MP? The evidence suggests not”

  1. AlanGiles

    Even if you paid them more, ghastly little men like Duncan-Smith, Chukka Ummana, David Laws etc would still be fiddling expenses. The old saying “the more you have, the more you want” comes to mind.

  2. littleoddsandpieces

    I do not begrudge a pay rise to MPs who say they have not had a pay rise for quite a while.

    What is lost is the care for the million and rising starving from babes in wombs to grannies each year, with the insufficient foodbanks who only give emergency food aid, when in Europe the EU funds daily free cafes, open 7 days a week that provide a free hot cooked meal and hot drink to equally, without conditionality of vouchers or restrictions how many times a year access, to the working poor, poor pensioners and the unemployed.

    And denying any state pension for life to huge numbers of men and women

    coming from next year because of the flat rate pension,

    that is anything but single tier as it will

    varying widely for individuals for decades to come,

    with official forecasts for next year as low as £55 per week with no top

    (currently full basic state pension is £113.10 per week).

    See why under my petition, in my WHY IS THIS IMPORTANT section, at

    https://you.38degrees.org.uk/petitions/state-pension-at-60-now

    Bearing in mind that many benefits end after age 64.

    97 per cent of the benefits bill goes to the working poor and poor pensioners.

    The state pension is around the 4 per cent lowest income
    and huge numbers of men and women only have the state pension as food and fuel money in old age, as were too poor for any other pension provision.

    This continues with the half of over 60s who are within the working poor.

    The poor now outnumber all other voters and yet parties that would represent them are not being given any media attention. From my personal website it is my hope to do what little I can to remedy this.
    Please share on your social media such as Facebook and Twitter these web pages:
    http://www.anastasia-england.me.uk

  3. Tim Jenkins

    If the conclusion here is not to pay MPs more i agree. But the focus on equivalent pay rates etc entirely misses the point. MPs value is about civic duty. If we start valueing them in terms of competetitive pay rates it has a corrosive effect on their real value. If we are to repair our system of representative democracy we need to strengthen civic duty, solidarity and even altruism. Like muscles these grow stronger with exercise so let’s have this debate using the right values not inappropriate market values.

  4. Jake

    People who argue based on equivalent pay rates must be rebutted with the fallacies in their own arguments. For us to just say they miss the point, and them to just say we miss the point, will surely miss the point.

  5. Arthur ASCII

    MPs are handsomely paid for the job they do. Sadly, the Westminster bubble is filled with greed.

  6. George Laird

    I don’t think because some people are used to higher pay outside parliament that is cause for raising MP’s pay, either you believe in public service or you don’t, that said, some already MPs don’t believe in public service just self service

  7. blarg1987

    I think they were going on about it to torpedo the argument the MP’s need to be paid what the market will offer, as a justification to increase their salaries.

  8. blarg1987

    Simple solution would be pay them on equivalent scales to public sector staff, so the secretary for health would be paid the same as a person in the NHS, with the link that they only get a pay rise with NHS staff etc.

  9. Leon Wolfeson

    Why not look at pay in some other countries, rather than making a lot of those statements which amount to speculation?

    Also, the good argument I have heard for raising wages comes in replacing expenses.
    But I’d rather provide non-cash replacements.

    i.e., pick a big city block or two owned by the government in London, near Parliament. Take the functions and shift them to, say, Manchester. Gut the building(s) and turn them into nice flats. Now assign MP’s outside a 90 minute travel distance from Parliament (using the same standard for travel required for unemployed people by the JC+) one flat each.

    And presto, no more allowances needed for second homes in London.

  10. uglyfatbloke

    Is n’t it time we had a debate about how much we should reduce their salaries? Most of them – across the all the parties – really are n’t up to much. Does anyone really think that people like Ed Balls or Jacob Rees-Mogg or Jim Murphy or James Brokenshire are worth anything like £1300 per week…not to mention all the tasty allowances pension benefits and effort-free ‘job’ opportunities?

  11. Bollinger Bolshevik

    Bearing in mind how much of the decison making has been passed to Brussels, far from an increase we should be looking at a pro-rata reduction in salaries.

  12. Mike Stallard

    You are making a false assumption.
    MPs are there to represent us. They are not the clever dicks who spend their lives behaving in a totally un-socialist way greedily getting more than everyone else (inequality is bad, surely). We want ordinary people to represent us. People who have had to struggle a bit to build up their family life together. People who know what it is like to get up at 6 a.m. because you have to, not because you think it is rather amusing. People who never eat out and who find paying off the bills a constant trouble.
    Being an MP should be an honour. Expenses – definitely. But that’s it.
    We need people who know what it is to earn a living doing a useful job. And so why should parliament sit all those useless hours? Why not less? If an MP behaves badly, we should be able to recall her/him too.
    The trouble at the moment is that the Party System controls all the MPs and they cease to work for us, but for the Party. And that means they get more and more out of touch with the electors.
    You are proposing mercenaries: we want people who are sincerely representing our interests.

  13. Frann Leach

    They’re supposed to serve us, and servants generally don’t earn that much

  14. Leon Wolfeson

    Yes, they are leeches. That’s what the second jobs are for. Moreover, worse, they promote capitalist behavior, further distorting the free market, and even set a lot of that distortion in law.

    And yes, the people you hate for working, as you’ve never had to.
    You don’t want them to be thought of – you want the MP’s to come from the rich, as you demand a right to recall any MP showing leftist thought, and as you rail against Parties – which every democracy has.

    You want people representing your rich.
    When the problem is FPTP.

  15. Guest

    Ah yes, gotta exclude the peons from being able to afford to be MP’s after all, on the back of your myths and fear of trade.

  16. Leon Wolfeson

    Look at why MP’s are paid in the first place. The historical reason.

  17. bugalugs2

    MPs would be being handsomely paid for the job they actually do at half their current salary level!

  18. bugalugs2

    So the only way they can get a pay rise themselves is tp award a pay rise to everyone they have responsibility for as well? And how long do you think it would take to run out of taxpayer’s money in that situation (express your answer in days please)

  19. SonofBoudica

    Paying more to get better people has been the mantra in local authorities for well over a decade, applying to both officers and councillors. In my own council the effect has been disastrous. The time-servers are even more determined to hang onto their posts and avoid making proper decisions because that involves risk.

  20. Bosun Higgs

    I would double MPs’ salaries, plus an allowance for the distance of their constituencies from London, but abolish all expense claims. This would remove a major distraction and moral hazard, as MPs would no longer devote hours to maximising their perks or have much motive for providing sinecures to their relatives or partners. It would also save a fortune on IPSA. (In any private organisation of Parliament’s size, expenses would be handled by one sympathetic but inflexible individual and his/her teenage assistant). They could claim tax relief on necessary expenses under the same rules as every other employee in this country, instead of having special tax laws just for them, as at present. After that, their salaries would automatically increase or decrease each year according to the index of average pay, but excluding the top 5% of earners.
    I’d allow them to have outside jobs, as long as they did not derive their income from knowledge or influence gained through being an MP. Any such insider income would be taxed at 100%.

  21. corinium

    The answer is simple. Make being an MP something you do AFTER your career as a train driver/doctor/lawyer/factory worker/whatever, by not allowing people to be MPs until aged at least 40, preferably 50. Public service then is a way for publicly minded people to put something back, having already had a working life where they have made whatever pile of cash their skills/drive/luck has allowed them to. This way you avoid having to compete in salary terms with the top of the income scale, while still providing a decent salary for people to live on if they have no other means.

    It would also put a stop to the Oxford/Cambridge PPE graduate/think tank/Spad/safe seat conveyor belt that exists in all 3 main parties. Being in politics as a career in your 20s, 30s and 40s would no longer be an option. It would be an end of career ‘giving something back’ option instead.

    It would also provide far more independently minded MPs, as they would not be tied to the party structure so such an extent to advance their careers.

  22. Bosun Higgs

    Well, obviously, if one reads Left Foot Forward, one knows all about domestic and outdoor staff.

  23. blarg1987

    Yup, as this will be a step change in behaviour, for to long we have been going down the road of I should have a pay rise sod everyone else, with a small group of people enriching themselves.

    it would create a carrot and stick incentive, encouraging them to pay professions well while also having a duty to balance things. Lets be honest if your boss said he deserved a pay rise for doing sod all and you did all the work you would not accept that would you?

  24. Guest

    And you’d have a lot of rich men very happy with the fact that the common people were priced out of it. It’s not a cheap job to do.

  25. Guest

    There’s absolutely no evidence about what you say on parties – age limits in other countries in the past did nothing of the sort.

    Moreover, it would likely lead to politicisation of the civil service jobs among “heirs” of parties, and mean that young, dynamic reformers were 100% locked out of Parliament.

    It’s completely the wrong answer to the wrong question. The right answer is changing the voting system.

  26. Leon Wolfeson

    The pay multiples in councils has been basically static, and remain vastly under the private sector’s CEO pay.

    And you mean like Barnet council’s Tory Majority, who have derogated (a power designed for, oh, paperclip ordering) major planning decisions to Capita?

  27. Frann Leach

    Ad hominem? Try and stick to logical argument, Mr “hiding behind a ridiculous name” higgs

  28. SonofBoudica

    Officers in the public sector have nowhere near the same pressure as in the private sector. I can only go by my own Council, but they avoid risk like the plague and always employ expensive consultants to make the decisions for them or have huge committees so that individual responsibility is hidden. They stay in their jobs whether they do them well or badly. If they are pushed out (extremely rare except when “restructuring” occurs) they get a massive pay-off and usually step straight into another public sector sinecure. I would agree that the CEOs of FTSE 100 companies are vastly overpaid but the private sector people I know in small and medium sized companies work far harder, for far longer hours and don’t enjoy the perks and job security of the public sector officers. They never have to worry where their next salary cheque is coming from, or whether the competition is going to seduce their customers away. They have to save for their own pensions without the taxpayer having to make up any shortfall in the pension fund. So don’t compare them to the private sector. There is no comparison.

  29. Guest

    Keep making up nonsense, as you talk about a council as if you’re mayor. They probably avoid YOU, because you’re a PITA, as you make up your myths about a sector which has seen far higher job losses than the private sector.

    You are hating on those evil teachers and nurses because you oppose what they do, that’s all there is to it, as you try and destroy what remaining non-scam pensions exist. So you can make a profit and look down your nose at the peons.

  30. SonofBoudica

    No, I have worked extensively with both sectors for many years. And I see what has happened. I have dealt with senior people in my council who don’t care about their job, have no sense of responsibility and do as little as they can get away with. And don’t talk about non-scam pensions. Gordon Brown dealt the death blow to private pension schemes by taxing their income. There are good and bad in both sectors. But in the private sector they usually get found out and have to go.

  31. Guest

    So you’ve worked to undermine the public sector for many years, and wonder why people are dismissive of you.

    You then go on to 100% attack non-scam pensions, as you blame Brown for abuse of the corpse Thatcher made. As you spout the same old lies, wanting even lower wages in a sector where far more have lost their jobs than the private sector, again.

    But facts, you can’t have that.
    You’d rather fire “bad” people who won’t work 60 hours for 40 hours pay.

  32. SonofBoudica

    No. You misunderstand and twist everything that I have said.

  33. remarx

    It is my belief that the reason for becoming an MP should NOT be driven by money but a firm conviction to do the best for people who voted for you. The particular elected MP must remember that he or she is representative of the wishes of the electorate.

    Of course a living wage – as with any job – should be awarded to the MP who must WORK for it.

    Political practice in this country is archaic and corrupt, consisting mainly of privileged, already wealthy people looking after their own interests. The rest is just blather.

    Many changes could be made to modernise parliamentary practice, but the people that would change it are the ones that do NOT WANT to change their cosseted positions. Unfortunately – unlike The French – us British are not willing to revolt, in case it rains that day or the cup finals on. What hope is there?

    Vive le revolution!

  34. J B London

    This is such a politically skewed analysis it’s hard to know where to start. There are lots of people who for reasons of narcissism or principle want to be MPs. But only a small proportion of them are capable enough to cut it in the elite professions — as a partner in a well-regarded law firm, say, where the average salary will comfortably exceed £500k. Unfortunately, although it is a conclusion that those distant from the markets resist, the stark reality is that highly capable people are an extremely scarce resource. Getting into Oxbridge doesn’t qualify you for this test. It’s a small fraction of that 1% (along with a good number who didn’t go to a fancy university for whatever reason; this is about ability not intellectual snobbery) who make it to the top rungs, which takes drive, stamina and social skills, as well as brain power.

    If we want highly capable people for our law makers, we should pay them properly. Until we do, we’ll get the narcissists and the zealots.

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