Cameron Minimum-Wage Announcement Shows Coalition Rift

Photographer: Jason Alden/Bloomberg

David Cameron, U.K. prime minister. Close

David Cameron, U.K. prime minister.

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Photographer: Jason Alden/Bloomberg

David Cameron, U.K. prime minister.

Prime Minister David Cameron announced an increase in Britain’s minimum wage before it was formally agreed by his government, in a bid to stop his Liberal Democrat coalition partners taking the credit, according to a government official.

Cameron broke the news of the above-inflation boost to 6.50 pounds ($10.84) an hour in a speech at lunchtime yesterday. Just hours earlier, his Conservative colleague, Chancellor of the Exchequer George Osborne, had discussed the planned timing of the announcement by Liberal Democrat Business Secretary Vince Cable with officials from his department, according to the person who was present and asked not to be identified because the discussion was private.

Cameron’s move suggests fractures in the coalition are growing as he seeks to distance the Tories from their partners as May 2015 elections near. Yesterday’s announcement also marked a Tory fightback against opposition Labour Party accusations the Conservatives are ignoring the rising cost of living and helping only the richest in society.

Osborne’s meeting came within a couple of hours of Liberal Democrat Deputy Prime Minister Nick Clegg accusing the Conservatives of resisting tax cuts in private while trying to take credit for them in public.

‘Kicking and Screaming’

“I’ve had to drag the Conservative Party, kicking and screaming, in every single budget negotiation,” Clegg told reporters in London when asked about Conservatives taking credit for an increase in tax-free allowances aimed at helping the lowest earners, a key Liberal Democrat policy.

“They’ve got a fair amount of brass neck to now claim that somehow all they ever wanted all along was to see the allowance go up, because that’s not what they said in public, and crucially, it’s not actually what they said in private, either,” Clegg said.

Cable’s department, which oversees the minimum wage, had only just sent paperwork on the minimum-wage decision out to other government departments before Cameron spoke, the person said.

The fact that the increase hasn’t been formally agreed was reflected in Cameron’s choice of wording. “I look forward to accepting this recommendation,” the prime minister told his audience in Coventry in the English Midlands.

Osborne Interview

It isn’t the first time this year that the Tories have ambushed their coalition partners on the minimum wage. On Jan. 16, Osborne gave an interview to the BBC in which he called for an above-inflation increase and floated the idea of raising the rate to 7 pounds.

That move came as a surprise to Cable’s department, which had been more cautious, asking the Low Pay Commission, which makes recommendations on the rate, to look at the case for an above-inflation increase.

On Oct. 23, Clegg’s spokesman told reporters that the Tories had only given them a half hour’s notice that the prime minister was going to announce a probe of energy prices.

Cameron’s office declined to comment on the premier’s decision to make the announcement ahead of time.

To contact the reporter on this story: Robert Hutton in London at rhutton1@bloomberg.net

To contact the editor responsible for this story: Alan Crawford at acrawford6@bloomberg.net

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