Living Wage

Susan Elan Jones Excerpts

Thursday 6th November 2014 Commons Chamber

[Mr Bain]

The hon. Gentleman raises an interesting and important point. Before his intervention I was saying that we should consider the impact of such measures on a lone parent in work. If she were to take a low-paid job—perhaps just above the minimum wage—the tax credit system effectively gives her an average hourly rate of £13 to £14. If wages paid not just by public sector employers but by the private sector increase, the tax credit system will still have an important role in topping up people’s income, but reliance on the state will be somewhat less. That will relieve pressure on the taxpayer and lead to a more affordable social security system in the decades to come.

[Susan Elan Jones (Clwyd South) (Lab)]

Does my hon. Friend accept that most people in this country do not pay taxes just to subsidise some fast food merchant or security company, and it is about time that we were better at getting that message across? When the centre right spoke a few years ago about “Broken Britain”—incidentally, I think the response from the centre left on that was inadequate—we forgot how such matters were dealt with on a corporate level, and we have to deal with that issue as well.

[Mr Bain]

My hon. Friend is entirely correct. The proportion of company profits paid in wages has declined in the past 15 to 20 years, but it has declined particularly in the period since the financial crisis and in the four and a half years of this Government. Companies must be forward looking if they want to retain staff and if they want staff to develop. Employees want a job that becomes a career—they want progression in that firm or that profession. Paying higher wages benefits not just the employee, but the employer. Many countries are demonstrating that.

How can we act to end the low pay crisis? First, every level of government, whether a council, a devolved Government, a regional government in England through local enterprise partnerships, or central Government, should commit to using whatever policy levers they have to advance the living wage, to show an example to the private sector and the rest of society. It was therefore disappointing that the Scottish Government yesterday rejected the Labour party’s offer in the Scottish Parliament to extend further the use of the living wage through procurement policies. I hope they will reconsider. With 264,000 women in Scotland earning less than the living wage, it was wrong for the Scottish Government to reject that practical and helpful suggestion yesterday. The living wage is too big a prize for us to be deflected by partisan considerations. People expect all politicians to use every tool at our disposal to extend it to the widest possible number of people. I hope that devolved Governments, central Government and councils use those powers and achieve precisely that aim.