If we believe that a Living Wage should apply to all, then we must be prepared to consider how we achieve it, writes Karen Jennings.
If we believe that a Living Wage should apply to all, then we must be prepared to consider how we achieve it, writes Karen Jennings
The Living Wage Commission – a 12 month inquiry set up by Citizens UK, Compass and several other organisations into the future of the Living Wage – is due to sign off its final report at the end of this month. UNISON has just submitted its written evidence to the commission, focussing on what we see as the single most important issue for Living Wage campaigners: the argument for making the Living Wage our statutory minimum.
There is absolutely no doubt that localised or employer focused campaigns for the Living Wage have been incredibly successful in raising the political profile of this issue and in showing how employers can avoid paying poverty wages when their minds are concentrated.
But we believe that the point has been reached where this localised, voluntary approach can no longer live up to the vast crisis of poverty pay which the UK is facing.
In their report Low Pay Britain 2013, the Resolution Foundation shows that 4.8 million UK workers (20 per cent of all employees) earn below the Living Wage – a huge rise from 3.4 million (14 per cent) in 2009.
These figures are staggering. They reflect a completely unacceptable structural problem in the way the UK economy works. They show that the piecemeal approach to extending the Living Wage has a major flaw – it can never hope to keep up with the incentive to drive down wage costs which is inherent in a free market economy.
If we believe that a Living Wage should apply to all, then we must be prepared to consider the means by which to achieve this.
One argument put in favour of voluntarism is that the Living Wage movement is not, at heart, about money. The claim is made that local and employer focussed campaigns empower those who become involved through the process of working together with fellow workers for a common goal. Consequently, we should not make the Living Wage statutory because this would remove the opportunity for this kind of empowering activity.
At UNISON, our low-paid members have a very different view of the Living Wage. They tell us that they often reach the point of total desperation as a result of rising costs and seemingly permanent low wages. Their level of pay forces them to do two and sometimes three or four jobs, meaning they have almost no time at all for family life.
For people living on the cliff edge of total destitution, a pay rise itself is infinitely more important and empowering than the possibility of being involved in a local campaign. Of course, there is no reason why other issues could not form the basis of localised campaigning, but we believe that the right to a Living Wage trumps all other considerations. For people earning poverty wages, it is about the money.
Another objection to raising the National Minimum Wage to the Living Wage level is that this would cause unemployment. Nobody wants to see a National Minimum Wage level which costs jobs overall. But up until now the interpretation of the impact of the NMW on the jobs market has been based on fundamentally conservative and unnecessarily cautious economic assumptions.
In November 2013 important research from former IFS economist Howard Reed went some way to addressing this issue. For the first time, this economic model included an assessment of the stimulus to the economy from increasing the pay of millions of low paid workers.
Howard Reed concluded:
“…it is unlikely that the extension of the living wage to all UK employees would result in any substantial aggregate employment losses. In fact, it is quite plausible that adopting the living wage on a statutory basis could actually increase overall employment in the UK”.
And this message is starting to cut through traditional political fault lines – convincing serious people beyond the confines of the Left. In addition to the trade unions, the Fabians, the Green Party, numerous Labour MPs there other significant voices have backed by more surprising voices. These include such dangerous radicals as Jeremy Warner, assistant editor of the Daily Telegraph and Paul Kirby a former head of David Cameron’s Policy Unit.
In a Survation poll carried last year, widespread support for this proposal became crystal-clear, with 60 per cent of people backing the move. Perhaps most significantly of all, the group who most strongly agreed with a Statutory Living Wage were the D/E social class group – the group most likely to be paid the minimum wage, who know the misery which can be caused by poverty wages.
At UNISON, we hope that the Living Wage Commission will be bold and expansive. That some Living Wage campaigners have traditionally eschewed moving towards a statutory approach is not a good enough reason to rule it out. The extent of the pay crisis in the UK demands that progressive people with a concern for social justice open their minds to this policy proposal.
A growing number of people are coming round to this view and it is now the task of Living Wage campaigners themselves to take up the cudgels.
You can find out more about the UNISON ‘Worth It’ campaign here.
Karen Jennings is UNISON assistant general secretary for Bargaining, Negotiating and Equalities
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