The Tories have long claimed that austerity impacts on us all on a fair and equitable basis. Osborne and Cameron believe that the wealthy pay their fair share of tax and contribute to society because of the value they bring. However, scanning through the High Pay Centre’s briefing on executive pay, “The State of Pay”, demonstrates that we are not all in it together and that executives are reaping far higher rewards than they deserve or that of the workers they employ.
The report established that the average pay for a FTSE 100 CEO rose to £4.964 million in 2014, an increase from £4.923 million in 2013. Furthermore the average pay ratio between FTSE 100 CEOs and the average wage of their employees was 148:1. In 2013, the ratio was 146:1. The ratio of FTSE 100 CEO pay to the median full-time worker across the whole UK economy was 183:1 in 2014, up from 182:1 in 2013 and 160:1 in 2010. In contrast only 25% of the 100 FTSE 100 companies are accredited by the Living Wage Foundation for paying the living wage to all employees.
The High Pay Centre concluded that pay increases over the past two decades have not been complemented by increases in company performance. Whilst the government imposes performance pay on public servants and the private sector is wedded to the same ideology, the rationale does not apply to those at the top of the pay league.
Public sector workers are capped at 1% and will not see any increase in their standard of living regardless of the efforts they put in through their work. Inequality, exploitation and low pay will continue. Britain doesn’t just need a pay rise – it requires a complete overhaul of its class relations, which only workers can do.