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Unpaid Careers Aren’t Worth £762.75 A Week, Nothing Like. £300 Mebbe

Why should I pay for yours?

The Social Market Foundation wants us to know that an unpaid carer is actually producing economic value of £762.75 a week. This is nonsense. But then it’s from the SMF so who is surprised?

In a report shared exclusively with Money, the Social Market Foundation (SMF) said a man or woman who works for 37 hours a week as an unpaid carer — such as full-time mothers — has an economic value of £762.75 a week.

They’re adding up what it would cost to buy in what is done and then applying that value to what is not bought in.

This isn’t the way to do it. We actually had a top level commission looking at this, the Sarkozy one. At least two Nobel Laureates there as well. A specific question asked being, well, what value should we ascribe to unpaid household labour?

The answer being the “general undifferentiated wage rate”. Or, as it is in practice, the minimum wage. That gives us about £300 a week as a useful valuation.


Because if we are out there in the market buying and selling labour then we get the greater efficiency of the division and specialisation of labour. The Magic Maids (or whatever) cleaning company that turns up with the industrial mops, mob handed, to scour the house cleans more in less time than the housewife trying to shift the carpet on her own. They’re more efficient- their labour output has a higher value.

Precisely because it is undifferentiated labour within the household it is worth less.

We then get to the big point here of course.

If 3% of this unpaid “salary” was saved into a pension — the same rate employers have to pay staff enrolled in a workplace pension — it would boost their pension pot by £1,190 a year.

Well, yes, if people save more into their pensions pots then they’ll get a larger pension.

If the government paid £23 a week into stay-at-home mothers’ pensions, Britain could close its vast gender pensions gap, a think tank has recommended.


Employers pay those pensions contributions as part of the cost of employing those workers. The companies are, after all, gaining the revenue from the labour being expended, pensions contributions are part of the price of that, just as wages themselves are. Actually, they’re simply deferred wages.

So, who gains the benefit from the labour of those stay at home mums? The other members of that family they’re caring for. Thus it should be those other members of that family coughing up the pensions contributions.

After all, why should I be paying more tax because your wife is preparing home cooked meals for you?

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1 year ago

The government *already* pays about £23 a week into unpaid carer’s pensions through the unemployed person’s national insurance credits.

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