The pounds 130,000 man who will decide how much Britain's poorest must earn

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The Government yesterday came under pressure to introduce a national minimum wage within a year by the new head of the Low Pay Commission, who admitted it could cost jobs.

Professor George Bain, whose appointment was announced yesterday, said he hoped a rate would be fixed by next summer, thereby looking to bounce the Government into an early decision. The pounds 130,000 a year principal of the London Business School revealed that ministers wanted the commission to complete their deliberations in 12 months, but said it could recommend a minimum by next April that could be made law within months.

The Government's favoured timetable is for the statutory limit to come into force later. Senior union leaders were told before the election it may not be introduced until early 1999.

Professor Bain refused to be drawn on a figure, but said there should be a balance between the aspirations of unions and employers. While companies would prefer a rate near pounds 3 an hour, unions are seeking a figure of more than pounds 4.

The 58-year-old Canadian-born academic said the rate should be struck at a level to help the low paid, but which would have a minimal effect on jobs. "It will be a difficult task, but not impossible. I would be surprised if there were not some job losses, but the question is whether those jobs would be better lost anyway."

The commission's task would be to conduct research and soundings among interested parties before advising on a figure. Professor Bain, a respected industrial relations specialist, said his experience as an arbitrator and mediator in labour disputes would be invaluable.

Potentially there were both negative and positive effects of a national minimum wage. It could lead to pressure from high paid workers to maintain differentials, but it could also have a positive impact by reducing staff turnover, increasing productivity, and providing a stimulus to more training, he said. Evidence was emerging in the US that showed a minimum wage in the catering industry led to job creation.

Professor Bain, whose appointment was welcomed by trade unions, has been careful not to identify himself with one political party. He discloses that he has voted at one time or another for all three main parties.

His involvement with industrial relations began 30 years ago at Nuffield College, Oxford, where he conducted research into white collar trade unionism. A former head of Warwick University's industrial relations department and business school, he also sat on the Donovan Royal Commission on trade unions and employers' bodies and the Prices and Incomes Board in the 1960s. As a member of the governing council of the Advisory Conciliation and Arbitration Service, he has won the respect of trade unionists.

However, he also has a reputation as tough-minded pragmatist. He argued for a six- figure salary when he applied for the job at LBS in the late 1980s on the grounds that they had to offer the same earnings as the best such institutions if they were to compete internationally.

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