National Minimum Wage

Lord Stoneham of Droxford Excerpts

Thursday 6th November 2014 Lords Chamber

[Lord Newby]

My Lords, as I said, a number of departments already pay the living wage. It is fair to say that there is a move across the rest of government in that direction, which is not yet complete. It is for individual departments to take those decisions. As far as care workers are concerned, HMRC, which is responsible for enforcing the minimum wage, has done a significant amount of work on this and is increasing its enforcement activities in the care sector and elsewhere. I take the point that the noble Baroness makes. In 2012-13, HMRC identified £3.9 million in arrears of wages for 26,000 workers who were not getting their full whack on the minimum wage.

[Lord Stoneham of Droxford (LD)]

My Lords, there is a sensitive relationship between raising the minimum wage and employment levels. Does my noble friend agree that it is only now, with rising employment and economic growth, that we can afford to give priority to raising the real level of the minimum wage, together with simplifying benefits and raising tax thresholds as a way of helping the low paid?

[Lord Newby]

My Lords, I completely agree with my noble friend; the increase in the tax threshold has made a major impact on living standards. That is why real household disposable income, which is the key figure looking at living standards, increased by some 2.2% in quarter 2 2014, and why the OBR forecast that earnings will rise faster than inflation from the second half of this year for every year to 2018.