What really motivates people - an analysis of MP's pay?
The announcement last week that a survey carried out by the Independent Parliamentary Standards Authority (Ipsa) which found that 69% of Members of Parliament (MPs) believed themselves to be underpaid on £65,738 and that £86,250 was the amount considered to be representative of their responsibility should come as no surprise.
I make this statement not out of any sense of resentment or jealousy, quite the contrary.
The amount of work that a typical MP carries out would seem daunting to all but the workaholic. If you consider that the number of constituents is in the range of 60,000-70,000 there is a potential for a lot of case work not to mention the need to be involved in parliamentary work such as sitting on committees.
If an MP is promoted to become a minister (junior up to the role of secretary of state on both 'sides' of the house) there is additional pay.
The thing to recognise is that, by and large, our MPs are hard working and, we sincerely hope, working in all of our interests though we may not always agree with their methods or policies.
It might be worth considering what a typical director of a company employing that many people would be paid?
As we know, senior executives are not noted for being parsimonious when it comes to their own pay.
The thing is, the context of MPs and what they are paid is influenced by the current zeitgeist, particularly in the 'popular press' which suggests that they are greedy and venal.
The expenses scandal among MPs was, to be fair, borne out of a sense that we could trust our 'betters' to act with integrity.
The fact that claiming expenses degenerated into what amounted to a 'free-for-all' allowed the detractors to assert that this is to be expected.
Those who fiddled expenses came from across the political spectrum and included some who originate from privileged backgrounds.
There has always been an argument that if higher salaries were on offer we'd attract better MPs. This is not the case and, in my opinion, the best MPs are most certainly not attracted by salary.
My value system is that public service is a privilege that bestows honour and that representing your constituents in Parliament is one of the highest that can be achieved.
However, it brings us back to what is sufficient pay to attract the best candidates who will be motivated to give their all to the job and dedicated to upholding the highest standards and virtues of Parliament.
How much would this be?
Let's go back to executive pay. Does the fact that they are paid salaries and bonuses running into millions guarantee that we get the best decision-makers who ensure that shareholders' interests are well served?
It's easy to generalise but why not take banks. The fact that senior managers at the likes of RBS were paid salaries that were akin to a very significant lottery win certainly didn't mean that shareholders got a good return on investment.
I accept that picking on bankers is no better than picking on MPs who are frequently reviled. However, the issue of pay is always a really interesting question which concerns every person who wishes to motivate staff.
The common assumption is that pay is key to motivation.
But as every student of management will inform you a great deal of effort has gone into trying to understand what creates optimal pay to ensure the most effective output.
One of the most interesting theories was that proposed by American psychologist Frederick Herzberg who carried out research into job satisfaction and in what is now regarded as a classic paper published 'One more time: How do you motivate employees?' in the Harvard Business Review, (Sep/Oct 87 Vol. 65 Issue 5, p109-120).
In his research in the 1950s and 1960s Herzberg set out to explore the impact that attitude had on their levels of motivation. Very sensibly he wanted to know what made people feel good about what people did in their jobs as opposed to what made them feel not so good.
What he came up with was the influence of two factors; hygiene and motivation and very importantly that money was included in the former and not the latter. Even more importantly he contended that his research showed that 'hygiene factors' (the etymology of the word hygiene is Greek work meaning health) had the potential for dissatisfaction.
The import of this is that if you want to reduce dissatisfaction you must attend to the hygiene factors which as well as including pay, incorporates the way in which the organisation develops and implements policies and formal terms and conditions, and the relationships that exist.
As the argument goes, if people are leaving and they cite the fact that you don't pay them enough, raise the salaries on offer.
However, if you pay the 'going rate' and people are leaving it may be because other hygiene factors are not right or, more likely, they are attracted by the motivation factors on offer elsewhere which, according to Herzberg include achievement, recognition, the interest that the person derives from the work that is carried out, and the potential for advancement and growth.
Pay, therefore, is important but not absolutely significant as long as it is about right.
What is always so obvious is that if you ask someone whether they are paid enough they will probably tell you they are not; we'd all like more pay.
But if the question is based on whether you are satisfied there will probably be a qualitatively different response.
My great hero the late quality guru Dr. W. Edwards Deming also advised on pay and specifically warned against the use of performance-related pay as he believed that it was not just a distraction but had the more serious potential to create division and jealously among people in organisations where, almost without exception, the objective is to create unity and cooperation.
The Japanese listened to him and followed his advice but in the West, particularly America, there has always been a blind faith in the belief that money is the thing that motivates people.
Indeed, the latest initiative introduced to create better performance by Secretary of State for Education Michael Gove is performance-related pay.
Sadly, it seems, those in control never learn though I suspect that Michael Gove has never read Deming's works.
The current climate of austerity will mean that there is no chance of MPs being paid more.
However, what MPs could do would be to address the real inequalities in pay that exist.
As any cursory analysis of pay in this country over the last fifty years will show, the greatest equality was in the 1970s and early 1980s when, on average, the very 'top earners' were paid between four to six times those on 'middle salaries'.
In the 1980s under the Thatcher government, as we remember, the prevailing zeitgeist was to unleash the forces of creative capitalism.
As a consequence salaries and bonuses based on performance for very senior managers increased so that top earners are now paid on average 148 times what middle earners are paid.
And we are all better off?
Once again I will let you decide the answer to that question.
If MPs are comparing themselves to senior executives then they will undoubtedly feel dissatisfied.
Paying people what they are really worth is always a really hard problem to solve.
Perhaps, as Herzberg suggested as a result of his research, a good starting point is to consider ways to improve satisfaction.
But whatever you do please heed Dr. Deming's advice on performance-related pay.