The government should support businesses by introducing new measures to boost productivity rather than enforcing higher wages for staff, the British Retail Consortium has said.
In a submission ahead of chancellor George Osborne’s emergency budget on July 8, the BRC called on the government to help employees to progress to more productive jobs by supporting skills acquisition and targeting low earners with lower taxation “rather than artificially inflating pay”.
It also recommended exploring tax incentives for business that encourage higher rates of pay.
The BRC rejected proposals for an “arbitrary increase” in the national minimum wage or introduction of a living wage, stating: “These suggestions are not only blunt instruments, but, when combined with a reduction in benefits, won’t put any more money in people’s pockets.”
BRC director general Helen Dickinson added: “Both retailers and the government know that there’s more to be done to improve productivity and to help people to progress to higher rates of pay. The barriers to progression and higher productivity are varied and complex. Unpicking these issues and developing sustainable solutions is the right approach.
“It’s widely expected that the government will be prioritising cuts to the welfare bill in this parliament. That is why we must work together to make sure that we can provide the best opportunities for our employees as these changes come into effect.”
Two other areas the BRC highlighted for action are business rates and EU reform.
It called for “fundamental reform” of the business rates system “that enables a successful reinvention of our high streets”, as well as immediate short-term reliefs.