A low pay epidemic is sweeping the North East, it is claimed, as new figures reveal one in four are paid below a living wage.
A report released today by KPMG estimates that well over a quarter of a million workers receive less than the £7.65 per hour experts say is needed for the basic cost of living in 2014.
The TUC claim that some businesses can afford to pay the living wage, calculated by Centre for Research in Social Policy, but are refusing to do so – and the regional economy is suffering as a result.
The North East Chamber of Commerce, however, says there has been progress and last week published a survey which shows 35% of firms increased workers’ pay above inflation last year.
Northern TUC Regional Secretary Beth Farhat called for a bigger commitment. She said:
“People deserve a fair day’s pay for an honest day’s work.
“But low pay is blighting the lives of hundreds of thousands of families in the North East. And it’s adding to the deficit because it means more spent on tax credits and less collected in tax.
“We have the wrong kind of recovery with the wrong kind of jobs – we need to create far more living wage jobs, with decent hours and permanent contracts.
“The fact is there are employers out there in our region who can afford to pay living wages, but aren’t.
“It is now time for all responsible employers to commit to adopting this standard, which enables workers to earn just enough to be able to live a decent life.”
Catherine McKinnell, Labour MP for Newcastle North, will speak at the Living Wage Summit at Newcastle’s Centre for Life on Thursday as part of a week of action on low wages by the TUC.
Newcastle City Council became the first to introduce a living wage and the authority boosted this to £7.55 in April, and South Tyneside has announced it is to follow suit. Councils in Gateshead, Northumberland and North Tyneside all set up working groups to explore the issue earlier this year.
Ms McKinnell, Labour’s Shadow Economic Secretary, said:
“People in the North East are really struggling with the cost of living crisis and with around one in four workers in our region paid less than the living wage, more must be done to tackle the problem of low pay.
“Finding ways to support and encourage employers to pay the Living Wage is a major part of that.
“It is fantastic to see more businesses and Labour-run councils in our region seeing the benefits of adopting the Living Wage, but it is important that we continue to demonstrate the value, both to employers but also to our region as a whole.”
The Living Wage Summit will also hear from local authorities, trade unions, voluntary and community agencies, such as the Child Poverty Commission and employers.
Speakers include James Ramsbotham, chief executive of the North East Chamber of Commerce, Sarah Vero from the Living Wage Foundation, Reverend Simon Mason and Matt Stripe, HR director for Nestle, who are a committed Living Wage employer.
Source – Newcastle Evening Chronicle, 03 Nov 2014
A Wearside youth project has pledged to pay workers the Living Wage.
Staff at the Youth Almighty Project, based in Silksworth Community Centre, Sunderland, will now be paid £7.65 per hour – higher than the national minimum wage of £6.31.
The Living Wage is an hourly rate set independently and updated annually. It is calculated according to the basic cost of living, using the “minimum income standard” for the UK, which is based on decisions made by the public about what it takes to make ends meet.
Coun Phil Tye, chairman of the project, said: “It was vitally important, due to the work that we do, to demonstrate not only to our staff, but for the people that use our services, that we respect our employees and recognise that the Living Wage is important.”
Employers choose to pay the Living Wage on a voluntary basis.
Living Wage Foundation director Rhys Moore said: “We are delighted to welcome the Youth Almighty Project to the Living Wage movement as an accredited employer. The best employers are voluntary signing up to pay the Living Wage now.
“It is a robust calculation that reflects the real cost of living, rewarding a hard day’s work with a fair day’s pay. We have accredited more than 700 leading employers, ranging from independent businesses to well-known companies.”
The project works with young people aged between eight and 19.
Source – Sunderland Echo, 22 Aug 2014
The number of children whose parents cannot find full-time work and are forced to work one or more part-time jobs has soared by 46% since the coalition government came to office, latest figures show.
Figures obtained by Newcastle Labour MP Catherine McKinnell show that between 2010 to 2013 the number of children whose parents were working part-time hours rose from 443,000 to 646,000, which Labour claim is a significant blow to the government’s child poverty strategy.
“While Ministers have been squabbling about how poverty is defined, these figures show how much tougher life is for families under David Cameron’s government.
“Getting parents into work should be the key step towards increasing their standard of living and reducing the number of children living in poverty. But for far too many families at the moment being in work just isn’t enough to meet the basic cost of living.
“Labour will back families and help to make work pay. We will expand free childcare for working parents, strengthen the minimum wage and crack down on exploitative use of zero-hours contracts. And we also want to introduce a lower 10p starting rate of tax, to help 24 million people on middle and low incomes.
“But while ordinary families are struggling with a cost-of-living crisis, David Cameron has given a £3 billion tax cut to the top one per cent of earners. We’d reverse that after the election as part of our plan to get the deficit down in a fairer way.”
The government has been forced to shelve plans to redefine the definition of child poverty which is currently defined by a households income. Children are said to be living in poverty if their parents total income is less than 60% of the national average.
Secretary of State for Work and Pensions, Iain Duncan Smith MP, wanted to change the way child poverty is measured, by taking a child’s family life into account as well as a family’s income, such as a child’s education and whether or not they come from a workless household.
Iain Duncan Smith was close to securing a deal with the Liberal Democrats, but it is understood that the plans were vetoed by George Osborne at the Treasury Department.
Liberal Democrat Education Minister David Laws, told the BBC:
“I can’t get into the entrails of why the Conservatives have been unable to agree and come forward with a serious set of measures. They will have to explain that.
“What I’m not willing to do is to allow this key debate over measures which are so important in driving the right policies in future to simply be vetoed by one party.”
> “I can’t get into the entrails…” That’s a weird and rather unpleasent scenario. Bet that’ll be appearing in a future edition of Private Eye.
He added: “The Liberal Democrats have a very clear idea of what the new measures should be, and we’re not going to allow the Conservative Party simply to end discussion of this.”
Shadow Work and Pensions Secretary Rachel Reeves MP said:
“Child poverty is set to rise by 400,000 under David Cameron’s government, while ministers squabble over the way poverty is defined.
“The row between George Osborne and Iain Duncan Smith does nothing to help working people who are £1,600 worse off a year because of the cost-of-living crisis.
“If David Cameron was serious about cutting child poverty he would scrap the bedroom tax, introduce a compulsory jobs guarantee, strengthen the minimum wage, incentivise the living wage and extend free childcare for working parents.”
The former Labour MP who chairs the current government’s Social Mobility and Child Poverty Commission, Alan Milburn, said: “A strategy which cannot be measured is meaningless.
“Despite taking more than a year to think about it, the government has drawn a blank, apparently unable to reach agreement on what a new set of measures should look like.
“The government has ended up in a no-man’s land where it has effectively declared its lack of faith in the current measures but has failed to produce an alternative set. This is beyond Whitehall farce.”
> The last few years have been a Whitehall farce… it’s just a pity Labour didn’t feel the need to start kicking up before. I’m sure the proximity to the next General Election is purely coincidental…
Source – Welfare News Service, 04 March 2014