What were you thinking of, Mr Brown?

05 April 2007
What were you thinking of, Mr Brown?

Hotel industry consultant Melvin Gold greets the tax restructuring in the Budget with disbelief

One of the headlines in the Budget 2007 supplement of the Times was, "The basic rate of income tax is cut, but low-paid workers will pay for it."

It beggars belief, not just that a Labour government is introducing such measures, but that it is another measure which adversely affects the challenges of staff recruitment in our sector.

We are a labour-intensive industry with a large number of relatively low-paid jobs and a significant number of part-time and seasonal workers. Many of these are women who, we're led to believe, the Government wants to attract back into the workforce.

So, Mr Brown, please explain what was in your thoughts when you effectively raised taxes for these people and made the prospect of part-time work in low-paid jobs an even less lucrative prospect? In our industry, people want to be part of a team, they want to provide a valued service for customers, or support their colleagues, and they want to enjoy the social interaction that workplaces offer. But of course they have families, and/or a lifestyle to support.

But where's the incentive for these hard-working stalwarts of our industry? When they pick up their pay packets in April next year and find less money inside, they'll know that their higher-paid colleagues will get a rise at their expense.

It was hard enough for caterers and hoteliers to recruit staff before. Perhaps employers are expected to make up the difference by above-inflation wage rises, but that just fuels inflation, which the Bank of England is battling by continually raising interest rates. Either way, or maybe both ways, it adds to our businesses' cost burden.

I just can't understand what was in Mr Brown's mind. His Budget was judged to be "clever". I'm not sure that the hard-working men and women of our industry, especially those who work on a part-time or seasonal basis, will call it that when they see the impact it has on their pay packets.

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