Reducing inequality requires more than diverting profits to wages

WHAT direction Ian Bell (“Working people depend on benefits Osborne is cutting”, The Herald, May 20) was going in to sort low-pay poverty was not too clear – while most totally agree that it is iniquitous that those paid so little have to have top-ups from other taxpayers, Mr Bell didn’t come up with much about its rectification.

It seemed that Tesco, for example, was thought to be able to divert some of its profits to increasing wages thus reducing the scale of the top-ups for its employees. This raises the question of why companies need profits, why isn’t all profit distributed to the workforce? There would be less money for development, innovations, improving ability to keep up with competitors.

Pay for the executive grades may be excessive, but cutting back here does not free up that much, apparently. Anyway, a company would just increase what it charged for its products to maintain profits and top pay, thus spreading the cost over the entire population .

This is not to say that low pay should stay, but reducing the inequality needs a more considered approach, including increasing taxation across the board to further public services’ provision. On its own the so-called living wage of nearly £8 per hour while better for so many of course does not do much for “social justice”: how can it cover rents/house purchase, council taxes, healthier foods, transport, other everyday living costs and allow putting some into savings? Again, the charges for goods and services would no doubt be raised to cover the extra outlay, thus clawing back some of the money. Those able to buy more however would then put disproportionately more into a company or public purse. That would help with the inequality gap. Joe Darby, Glenburn, St Martins Mill, Dingwall.