Paying nurses £5,000 a year more would actually help the economy

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Nurses need a significant pay-rise of at least £5,000 a year. The argument against it by the Right is that it would lead to increased national debt.

However if you do a little research into the economics behind this then you will see that their argument is false.

The Government paying nurses more will lead to those nurses spending more money, which means more tax revenue, slightly less unemployment and ultimately could lead to a reduction in national debt.

Basic Economics

If the government pay nurses more, firstly those nurses are going to pay income tax on that salary so some of that money will instantly come back to the government.

Secondly nurses are not going to hoard their money away in offshore bank accounts in the Cayman islands. They are going to spend that money which will be good for local businesses and the national economy.

For example less nurses will have to go to food banks and instead purchase items at local supermarkets. V.A.T will be paid on those items which is more tax revenue for the government.

Those local shops will now have more customers and more money coming in. This will mean that they will pay more money in tax on their profits and have to employ more people (who will also pay income tax):

The result of having to employ more people leads to lower unemployment and hence less money for the government to pay out in unemployment and housing benefits. Furthermore if the nurses’ salaries are enough to live comfortably on then far less of them and their families will need to rely on in-work benefits.

In other words if the government spend £1bn extra in salaries to nurses then they will save and receive at least £1bn if not considerably more.

This rather simple economic explanation also explains why austerity has failed and lead to increased government debt.

It really is quite simple to understand when you think of it and can be explained to a child in minutes. So the question as to why Conservatives oppose the pay-rise is either due to (a) an inability to understand basic economics, or (b) they understand the economics but do not want to give nurses fair pay due to ideological reasons.

Shlomo Anker

Shlomo is regular contributor and co-founder at the Pileus. He was previously involved in the Labour-supporting media group, Jewish Voice, and in an ongoing project to revive the Yiddish language. He is a fan of Leyton Orient & Hapoel Tel Aviv and a keen cyclist. It is while cycling that he often does his thinking for what to write in his articles.