In LibDem/Tory Britain, families are facing a cost of living crisis…
Prices have risen faster than wages in 38 of the 39 months that David Cameron has been in Downing Street
Working people are an average of almost £1500 a year worse off under this Coalition Government.
Labour will tackle the cost of living crisis by building an economy that works for working people.
The next Labour Government will cut to one of the roots of the cost-of-living problem – low pay. We’ll strengthen the National Minimum Wage in order to tackle low pay.
The National Minimum Wage was one of Labour’s great policy successes – it boosted pay at the bottom without leading to a loss of jobs, and has wide industry support as a result.
But low pay has got worse under the LibDem/Tory Coalition:
Average wages have fallen in 38 out of 39 months since David Cameron took office
The value of the national minimum wage has declined by 5% under his watch.
So the next Labour Government will strengthen the minimum wage.
The minimum wage needs to rise faster than it has in the recent past in order to catch up with where it was in 2010. If the minimum wage had increased in line with inflation over this period low paid workers would be earning £20 a week more than they are now.
Ed Miliband has asked Alan Buckle, Deputy Chairman at KPMG, to investigate how we make sure the role and powers of the Low Pay Commission are extended to strengthen the minimum wage.
We will build on the strengths of our approach in government:
Basing decisions on partnership between employers and employees; and
Balancing the need for wage growth with concerns about the impact on employment.
Won’t this cost jobs?
In government, Labour’s approach was characterised by partnership with employers and employees and a balanced approach towards the need for wage growth and the impact on employment. Many people warned that this would lead to job losses. This didn’t happen. We would use the same approach this time around.
Which sectors would have to pay more under these proposals?
Alan Buckle’s review will look at how to strengthen the Low Pay Commission, including the option of giving it powers to investigate whether some sectors can afford to pay more. For example, analysis by the Resolution Foundation shows that increasing the NMW to the rate of the living wage (£7.45) would cost large employers in sectors such as finance, construction and computing less than 0.5% of their total wage bill. Around one million workers would see their wages rise.
There’s evidence that the minimum wage puts little pressure on some sectors that could afford to pay more.
Who would decide which sectors have to pay more?
We would build on the success of our approach in government – with decisions built on partnership between employers and employees in the Low Pay Commission.