Unbalanced Britain: The Living Wage and Labour’s Future

The Rose Bowl at Leeds Beckett University was the venue for the ILP’s second Unbalanced Britain seminar on 14 March, examining the changing nature of work, the campaign for a living wage and the likely response from a Labour government.

The recession and its lop-sided recovery have left millions of working people in poverty, claimed Tom Chigbo of Leeds Citizens. Addressing the latest ILP seminar on ‘Unbalanced Britain’, Tom argued that with 10 per cent of the workforce on zero-hours contracts and 20 per cent earning less than the living wage, there was an urgent need to address the gross inequalities emerging in the UK labour market.

UB2 Tom Chigbo picIronically, at a time of fiscal deficits, such in-work poverty costs the UK government some £30 billion in tax credits, which merely fill the income gaps created by poverty wages, plus £5 billion in housing benefit, much of which goes to line the pockets of private landlords.

Underlying this dismal picture, Tom suggested, was the long-term weakening of labour power through diminished trade union influence and membership, sub-contracting and job insecurity. If you are struggling to make ends meet, perhaps with two or three jobs, you don’t have time or space to challenge employers, he pointed out.

Tom moved on to look at one of the most influential and inspiring responses to the growth of a low-wage economy – the Living Wage campaign. He detailed its growth from its early beginnings in East London in 2001, through the founding of London Citizens, until the present day when it’s become an issue firmly on the national radar with over 1,000 companies pledging to pay a living wage.

Aside from its achievement in getting the issue onto the agendas of politicians and private companies, perhaps the most interesting aspect of the story was the campaign itself and the distinctive way it was organised.

First started by TELCO (the east London community organisation, the fore-runner of London Citizens), the campaign was organised on a geographic, community basis by networking among existing institutions and community groups. It focussed on making connections between these organisation before identifying specific issues on which to campaign.

Even once the living wage was identified as a key concern, the campaign began, not with a generalised call for all employers to pay a living wage, but with targeted actions aimed at a couple of specific organisations – local NHS employers and Barclays bank, for example. Once these were won over, attention moved to other employers and eventually to the Greater London Authority itself with both Tory and Labour politicians brought onside.

Secondly, the issues were framed in a specific way so that it was hard for employers to disagree – for example, the call was for a ‘living’ wage, not a ‘fair’ wage or a ‘higher’ wage. This was in marked contrast to traditional trade union campaigns, which typically argue for per centage increases in pay.

Imaginative tactics

The campaign also managed to reach sections of the workforce not captured by traditional unions. Casual and part-time, subcontracted employees were often not present ‘on site’ long enough to be contacted by trade unions. But the living wage campaign gave ‘a voice’ to those normally excluded, such as cleaners.

It also used imaginative tactics, such as giving office cleaners a share in the company so they could vote and speak at company shareholders’ meetings, and embarrass the CEOs whose offices they cleaned. Some also left leaflets on senior civil servants’ desks so that the issue was brought to the attention of ministers.

The movement’s aim was to remain very broad, Tom explained, to bring temporary ‘enemies’ – those resisting living wage demands – onside, so converting enemies into allies. The list of organisations now backing the Living Wage Foundation (the body that certifies companies implementing living wage policies) testifies to the success of this strategy.

The campaign has also had a broad political impact, managing to get Tory and Labour London mayoral candidates to vie with each other over who had the best record on living wages. Boris Johnson was by any measure a free-market supporter yet had been brought into the fold as a supporter of the living wage.

The question of whether a living wage should be backed by legislation was a trickier issue, according to Tom. It was better to achieve the living wage by campaigning and voluntary support, he argued, because that helps to embed it as a ‘new moral minimum’.

It also gives the low waged a status and a voice they wouldn’t have if the living wage was imposed by central government. However, he did concede that there were some opportunities for legal changes – such as forcing companies seeking public procurement contracts to pay the living wage.

Despite it’s success, much remains to be done, Tom concluded. An hourly living wage doesn’t address the problems of zero-hours contracts – an increase in your hourly pay rate is limited help if you only get to work for a few hours a week.

Who counts as an ‘employee’ (not apprentices or the young, for instance) also limits its reach. And while some of the ‘easier’ sectors, such as law and banking, had been won over (those where the number of low waged employees is a small proportion of the workforce, making adoption of the living wage relatively low cost), others, such as hospitality and catering, are much tougher targets.

Labour’s programme

Former Labour MP Harry Barnes picked up on many of the issues raised by Tom in the second session when he looked at what we can expect Labour to do to reform work and wages in Britain if it gets elected.

Through his blog – ‘Three score years and ten’ – Harry has been dissecting the various policy pronouncements to emerge from Labour’s review process over the last six months or so. In particular he has unpicked the 114 bullet points which make up Labour’s ‘Changing Britain Together’ document which was published last year, and which Labour leader Ed Miliband has been headlining “bit by bit” over the following months.

The policies set out in these documents, Harry says, have moved Labour away from ‘a New Labour position’ towards one that many on the left might recognise as ‘progressive’ or even ‘social democratic’.

This ‘shift of ground’, the ‘door left ajar’ to the left, is not unequivocally open, he says, it needs to be pushed. For example, Labour’s ‘Work and Business’ policy forum – which included such members as Rachel Reeves, shadow minister for work and pensions, as well as Paul Kenny of the GMB and Karen Christiansen from the Co-op Party – came up with a rather generalised list of intentions, such as ‘expand the living wage’, ‘stamp out zero-hours abuse’, and ‘pursue equal pay for equal work’, which fall rather short of specific commitments.

The problem, he claims, is that Labour hasn’t pushed these ideas far enough or hard enough, with potentially disastrous consequences, particularly in Scotland where it is haemorrhaging support to the SNP, but also in England and Wales, where Plaid Cymru, the Green Party and UKIP look set to benefit from disillusion among Labour voters.

Others suggested the problem was less to do with Labour’s policies than its lack of a compelling vision, or narrative, to capture people’s imaginations. The left has not just lost the political and economic battles of the last 35 years, but the cultural ones too. Labour is now seen by many as mainstream and part of the elite, either just another bunch of politicians or another obstacle to progress.

The result of such a ‘complex’ situation, said Harry, is a general election that is impossible to predict, and could yet signal an end to Labour’s long-term role as the primary vehicle of left-wing politics, especially if there’s a change in the electoral system.


‘Unbalanced Britain: Work, Wages and Labour’ was the second in a series of meetings by the ILP on the theme Unbalanced Britain. You can read a report of the first meeting here.

Tom Chigbo is a community organiser with Leeds Citizens. An article based on his presentation will be published here soon.

We are hugely grateful to Tom for stepping in at the last minute in place of our scheduled speaker, Professor Jane Wills, who was unable to make due to illness.

Harry Barnes is a former Labour MP for North East Derbyshire and author of the blog ‘Three score years and ten’. You can read an article based on his talk here.


  1. Harry Barnes
    2 April 2015

    See Labour’s Workplace Manifesto – http://b.3cdn.net/labouruk/0d7eac1a5ecd182f46_e8m6ivtck.pdf

  2. Ernest Jacques
    26 March 2015

    Harry our differences are not great and are indeed down to strategy and tactics and perhaps you have more faith in the motivation of some of the Labour leadership than I do. But talking these things through and being confronted by the views and experiences of other ILPers, democratic socialists and thinkers like you, Will Brown and others is really important.

  3. Harry Barnes
    25 March 2015

    Ernie: I feel that our differences on the Living Wage are mainly tactical. Given the UK’s political system and the economic restaints it currently operates under, then how can we advance beyond a minimum wage (which still does not operate universally) towards the living wage? I accept that pushing the principles you propound can help to speed up my more gradualist approach. So perhaps the dialogue helps.

  4. Harry Barnes
    25 March 2015

    Terry : I was really only clutching at the Greens as an example during the debate. My point is really that unless Labour wins the General Election, even as a Minority Government and thus (hopefully) starts to deliver the general thrust of its adopted policies: then we will enter a very unbalanced period for the way forward for democratic sociallists. An election defeat is likely to lead to serious pressures within the Labour Party for the election of a new leader. There is then a serious danger that it is a clear figure out of the New Labour tradition that will win the day and will firmly establish the party in that position. Democratic Socialists in the Labour Party will then be isolated as under Blair and Brown as just being “the usual suspects”, giving them no other options but to rebel or knuckle under. An electoral and ideological decline is a clear possibility, given that Labour fell back to 28.3% of the vote in 1983 and 29.0% in 2010. Labour’s continuing role in the political game has rested on the first-past-the-post electoral system. A system which in current circumstances also benefits the SNP and PC and may not save Labour in the long run if it falls below a certain threshold.

    It is not easy to see how democratic socialists would and should respond if Labour goes into a serious electoral decline. Especially if New Labourism triumphs within its structure. We are in a similar type of quandary which our predessors were in the 1890s. They had at least three options. (a) Would they join with the efforts of Keir Hardie and company to set up an ILP and then a Labour Party? (b) Would they support the then Fabian’s approach of permiation – trying to influence the radical wing of Liberal Party on issues and doing the same even with Conservatives, and with the ILP and then Labour Representation Committee? (c) Would they associate themselves with Lib-Labism which with the extention of the franchise from 1884 was starting to deliver seats especially for people from mining communities? The ILP to Labour Party path eventually triumphed. We had a Liberal Minority Government going into the First World War. Within ten years they were down to 40 seats and Labour had replaced them as part of the two-party system. It was passing events that led to the shake up. What passing events are we likely to face? Back in the 1890’s, it was rather confusing as to which path democratic socialists should devote their efforts to. It was events that clarified the relevant commitment.

    What then might be the avenue for democratic socialist today if the General Election goes wrong? Permanent decline within a New Labour Party? Look elsewhere – the Greens, Ken Loach, put the bits and pieces together such as CLASS and the ILP? Keep the flame burning by turning to writing, blogging and discussion groups – a varient of the approach taken by Ed’s father? A mixed approach? No pattern is obvious, but I feel that we should think about this matter.

    If we add a European and wider dimension, then we are into an even deeper quandary.

    At the moment there is a better hope. It is that Labour forms the next Government. We then press for it to deliver and advance its programme. We start to turn the corner. This is my own short term commitment. But we have to give some thought to what happens if in the relatively short term this all fails and we get ourselves deep into new complexities. I imagine that for residual reasons and especially my local connections, I will keep my Labour Party membership card. But there might increasingly be a need to talk and mix with others – even the Greens.

    I am sorry that if in the exchanges I seemed to be saying something that was more definite than this. Put it down to the shortcomings of old age.

  5. Ernest Jacques
    25 March 2015

    Hi Harry & Will,
    I do agree with almost all of what you have to say about the living wage debate and my feedback and critique of the voluntary route and support for compulsion was most certainly not meant to be a criticism Tom Chigbo or of UK Citizens, quite the reverse.

    As I tried to say, crudely no doubt, Tom, UK Citizens and the Living Wage Foundation have done a really remarkable job in making the living wage debate visible again and in linking up otherwise disparate community groups and individuals in a way that others have not and could not do. A point that comes through loud and clear in both your writings, and which is embedded in the ILP perspective insofar as fundamental social change can only be implemented via the will of the wider electorate and when society allows it.

    Labour Party – Part of the Answer or Problem?
    Where we might part company is whether the Labour Party, in its present state, is (or can be) a force for political education and progressive change beyond its usual one nation spin and its support for the union, the establishment, machine politics, big money, corporate and establishment bribery and our Westminster, business as usual politics.

    In this regard, Labour’s persistent cost of living whinge (response) is not only mealy-mouthed and wholly inadequate to the needs of working people who are suffering hard-ship in the wake of the avalanche of outsourcing, privatisation, wage cuts and austerity measures. A totally ineffective response that, to my mind, plays straight into the conservative neoliberal culture, falsehoods about trickle-down economics and a Tory cuts agenda, and the narrative that in a global economy there is no alternative to unit labour cost-cutting measures (always at the bottom) and that any job is better than no job. Well not in my book, it’s not.

    And Chucka Umunna’s (Labour’s shadow business minister) suggestion that the answer to fair wages is to incentivise employers to pay a voluntary living wage is a typically limp response and cop-out to the very real crisis of low wages, workplace exploitation and unbalance throughout the UK. The same applies to Miliband’s stock response to the long running Firefighters and care worker strikes (or any strike for that matter) over cuts to their pensions and conditions of employment. When Ed Miliband is asked to comment all on these industrial disputes all he ever says is they should resolved via negotiations. Brilliant response from one of the best of our present bunch of wannabe ministers who appears far too frightened of annoying media and forces of capital than by saying the right thing and in giving unqualified support to working people who have done nothing wrong and are simply trying to defend their existing wages and conditions of employment.

    Is there any wonder then that large numbers of the electorate are cynical about the motives of Labour leaders and are apathetic about voting or that the traditional Labour vote is today less inclined to be used as voting fodder and is fragmenting rapidly in former Labour heartlands?

    The whole point about my feedback on the living wage presentation in Leeds, is that despite some welcome successes, a voluntary systems cannot and will not work because the big money forces pushing the other-way won’t allow it and all the evidence suggests (despite all the bogus statistics about average earnings being on the up) that in the general scheme of things wages and conditions for millions of working people are on a downward trajectory.

    Care Work Horror Story
    After listening to the Jeremy Vine (BBC radio 2, news and views) talk show yesterday it was shameful to listen to care workers outlining their horror stories (and they were all bad news stories – no balanced good news) about the way they are treated by the newly privatised care industry employers. Numerous good, loyal and compassionate care workers took the trouble (were brave enough) to inform the nation about the car-crash that passes for domiciliary care in the super-duper efficient privatised care sector. It was truly heart-breaking just to listen to these stories, never mind experience working in such circumstances or being a vulnerable client of these companies who set their staff impossible time schedules and provide home (joke) care for our elderly and most vulnerable citizens.

    And despite have a statutory National Minimum Wage thousands of care and other workers are routinely and forcibly working for less than the NMW with one care supervisor mentioned working long, unsocial, hours being paid the equivalent of £1 per hour. Now that is slave labour by any measure but if you think that is scraping the barrel, think again, because another example was given of a consciences and compassionate care worker – who covered for a colleague who was stuck in traffic with a flat car tyre, but because the client she visited had complex and problematic care needs that simply could not be ignored she ended up – getting just £1.11 for 3 hours work.

    Numerous other carers rang in to report similar experiences and to explain why they had now left the job they loved because of impossible work schedules and because of the long hours, stress and low pay and disrespect by their employers who despite all the marketing hype about the customer being their raison d’être and at the center of their concerns and services. In reality, many of these firms treat both staff and clients as pure commodities and their primary (only) focus is money making and the bottom line. Exemplified by the widespread practice of “clipping” (time) which means that because of impossible work schedules, the care workers often simply turn up on time, mumble a few meaningless salutations, provide minimal or no care but, importantly, it ensures that the company gets its money and the care visitor gets paid.

    One lady said she enjoyed the work when employed by the local authority but since going private her new employer was only bothered about money and getting paid and because she is consciences and loves her clients, she now works regular eight hour shifts but because she doesn’t get paid for traveling between appointments she gets paid for just 5 ½ hours and well below the minimum hourly wage. Another reported that she has a strict 30 minute time slot, which includes 17 minutes travel time, to wake up, wash, feed, provide medication and complete the care log, before leaving for the next appointment and any slippage time, for whatever reason, is simply not tolerated.

    And do you know what is really troubling about this state of affairs is that it is both routine and tolerated by local authorities up and down the country and that includes many Labour run councils who, as contractors are supposed to monitor the care that they commission, but ofter turn a blind eye to this car crash of a non-care service. And in this age of a statutory NMW and super-duper efficient privatised home care services we have care providers buying special designed computer software to justify impossible journey times and illegal pay.

    And the same sort of efficiency and money saving measures are popping up in care homes with dozens of local authorities, including Labour run councils listing the personal health details of elderly residents on special websites (without their knowledge) and inviting private care providers to bid for the work. A system that, to me, seems more appropriate to a cattle auction than for the welling of elderly and vulnerable citizens. Unbelievably this practice has be justified by Labour controlled Birmingham city council because it can make efficiency savings and cut care costs by as much as 20%. Well good for them! Shameful and disgraceful were words that I (did not) use when listening to this outrageous horror story.

    A member of union also reported that throughout the UK – private sector – home care providers are refusing to provide even basic care and visits to thousands of lonely elderly and disabled people with multiply and complex needs on the basis that they are too expensive and their are no profits to be made. Lovely people, and compassionate councils (not).

    One Swallow Does Not a Summer Make
    So to my mind, when it comes to unfairness, gross exploitation and illegality in the world of work, sadly these examples and many more across whole sectors of the UK economy are much more typical than the minuscule number of employers (1000) who have signed up to pay a living wage.

    So while I do admired greatly the presentation given by Tom Chigbo and also think that UK citizens do a brilliant job, as do the church and many faith groups who organise food-bank volunteers and givers and like Archbishop Sentamu – in my home town of York – are great champions of the poor and the socially excluded. But having said that, I really do not think Sentamu’s work and payers and that of the Living Wage Foundation are enough to bring about fundamental social change and the dream of a living wage, for all working people. Of course both Harry and Will are both right to suggest that Rome was not built in a day and that a gradualist approach is more likely to elicit public support.

    National Minimum Wage
    But as with the introduction of the NMW we now know the economy did not suffer the cataclysmic catastrophe forecast by many employers and fair-wage gainsayers. And as I mentioned in an earlier comment, had the NMW been increased in line with inflation, it would now be over £9 per hour and above today’s Living wage of £9.15 in London and £7.85 in the rest of the UK.

    Where there should be some room for compromise, I think, is with some sort of transitional arrangements, for small and medium sized enterprises, of the sort I mentioned in my own crude presentation on this topic last year. This would mean that the employees of these small businesses would be paid tax credits on a sliding scale over a 10 year time scale. And if that sort of arrangement became popular and a Labour manifesto promise (well we all have dreams) then the party of labour would, I think, be on a truly one nation trajectory.

    Where there might be room for have some (out of the box) fresh thinking would be in the trade union movement and amongst the many other UK workers who might want to use the implementation of a statutory living wage (much better name than the national minimum wage) to increase their differentials.

    But a statutory living wage would only work with strict and powerful sanctions against all individuals, directors and agencies who might seek to circumvent the law be they employer, accountants, employment agency, whoever, and the system is also policed by trade unions, workers and whistle blowers and community groups like UK Citizens.

  6. Terry Jacques
    25 March 2015

    It seems to me that Tom Chigbo from Leeds Citizen is unrealistic and/or indulging in wishful thinking, to believe that many employers will implement the living wage for all employees on a voluntary bases. My experience of the retail sector suggests there is absolutely no prospect that the Living Wage campaign will succeed in persuading the likes of ASDA and other large employers to voluntarily implement the living wage. It is also significant that the Labour Party remains silent on plans to legislate for a statutory living wage should it be elected into office in May.

    Harry Barnes seemed to be suggesting the Labour Party may poll badly in the May General Election and if it does, the party could implode in the aftershock. Harry suggested that it may be necessary for people on the left to consider supporting the Green Party. I was surprised at this proposition as I do not consider the Green Party to have realistic policies or credible leadership. This is certainly not a party I would be prepared to support.

  7. Will
    24 March 2015

    Some good comments here but I want to pick up on a couple of things Ernie has said.

    The first is that you criticse Tom for not covering the wider labour market trends and conditions that are important. I agree with you entirely that these are important but I don’t think it is fair to criticise Tom for not covering them. As you note, he stood in very late in the day and covered a lot of ground. He did also acknowledge there were limitations to the living wage campaign and that it is not a cure for all ills in the labour market.

    The second is a trickier issue – whether the living wage should be voluntary or not. I don’t think it is right to characterise Tom’s view in favour of a voluntary scheme as a ‘smoke screen’. There is a genuine strategic choice here. Tom said he came to this view ‘on balance’, so it was not not just a blanket, unthinking rejection of the statutory route. Moreover, he gave reasons for this conclusion which you don’t address, namely that by going for the statutory route you may lose some of the gains that a targeted campaign for voluntary adoption of the living wage can and has delivered: the empowerment of the low waged workers involved in such campaigns and the collective solidarity among groups involved that is created. These are longer term gains, changes in perspective that are not to be dismissed lightly.

    In fact, the living wage campaign has achieved something that those of us in the ILP ought to celebrate – it has rooted in the wider society, across a broad range of people, support for a progressive ideal. It has changed the terms of debate and converted people to the cause across a wide political spectrum. These are things the ILP has long argued are necessary: to create a shift in viewpoint in the wider society.

    Indeed, we have gone further in the ILP and argued that this wider shift in viewpoint is not just important in itself but in fact is a precondition for any government to successfully introduce the kind of statutory reforms you would like to see. Progressive gains can only be imlemented if the wider society allows it. The very possibility of a statutory living wage – the fact that we can even talk about it as a realisable aim – is down to the campaign that has been fought hitherto.

    Now, that is not to say that a statutory option should not be taken – I can see the argument for that too, especially if the limits of a voluntary approach are reached. It may be that the campaign reaches a point (or we may have already reached a point) where this becomes necessary. But let’s not ignore the road travelled so far, to bring us to the point where this can be sensibly debated. For that we owe a lot to the kind of campaigns Tom talked about.

    Best wishes,

  8. Harry Barnes
    24 March 2015

    Ben : I am assuming that Miliband has had a significant influence on the policy programmes which were adopted at the last Labour Party Conference, or he is otherwise at least willing to pursue these in the election campaign – and hopefully beyond that. For his speeches and responses to passing events, overwhelmingly seem to fit in with what was agreed at the Manchester Conference.

    For democratic socialists there are shortcomings in what was agreed to (or pushed through) conference. “Working people” are supported in ways which dismiss the needs of the unemployed and those on benefits. The stress on economic prudence seems to place a block in the way of hoped for social improvements. On areas of difficulty in tackling the growing powers of internatiional capital (which will be extended with TTIP), the reservations in Labour’s programme seem to be very restrictive. Many more items are problematic when closely scrutinized.

    But this (when we look at the full range of Labour’s proposals) does not mean that we are stuck in the rut that we were in during the elections which were fronted by Blair and Brown. I suggested we were moving into a modern version of the short era of John Smith, as a way of claiming that we were coming out of the days of New Labour into a landscape in which future inputs from democratic socialists would not just be dismissed as coming from “the usual suspects”. To me, John Smith was a fairly middle of the road labourite; but someone that many democratic socialists could, at least, seek to influence. Maybe a better analogy could be found. But the programme for 2015 seems to me to be less problematic for socialists than those of 1997, 2001 and 2005. (I accept that I was re-elected in those problematic years, despite my best efforts locally to sideline the Party’s programme).

    Ernie : Can’t the proposals for a Statutory Minimum Wage and a Living Wage actually be run alongside each other? The Living Wage can be used as the target towards which the Statutory Minimum Wage should be pressed. In the meantime, however, any Labour led Government could press to advance the Living Wage. It could see that it is done via the services it provides or furthers. Laying it down for itself, its agencies, devolved authorities, local government bodies and for the contactors it used. Such moves provide a pattern wherebye the practice of the Living Wage spreads and a situation can then arise when the final step is to make the Living Wage statutory. The trick is to make the goal of gradualism an inevitable one.

  9. Ben Saltonstall
    22 March 2015

    Harry suggests that Miliband is taking Labour to something like the position held by John Smith and Margaret Beckett in 1992-4. I disagree.

    If you want to understand Miliband’s thinking, you find some policy background in this IPPR/ Policy Network pamphlet http://www.policy-network.net/publications/4857/Progressive-Capitalism-in-Britain

    I accept that this pamphlet may not be the full story. Miliband seems more inclined to view some markets as dysfunctional than the authors of the pamphlet are and I suspect that he believes that the state should have a more direct role in oligopolies.

  10. Ernest Jacques
    22 March 2015

    Unbalanced Britain – Leeds meeting

    Tom Chigbo from Leeds Citizens gave an excellent presentation on the work of UK Citizens and the Living Wage Foundation and how the campaign for a living wage has linked up a whole range of otherwise disparate community and campaign groups across the UK in a non-sectarian, positive and visible way. A campaign with links into local neighbourhood communities and businesses, that traditional political activity does not and/or cannot reach.

    Voluntary System – Problematic
    But in truth a voluntary focus is hugely problematic insofar as despite some progress and welcome good news stories Tom simply glossed over general employment trends vis-à-vis the race to the bottom and growing workplace exploitation.

    An argument that also allows politicians of all complexions off-the-hook and to sound compassionate (I mean who would dare deny their fellow citizens a living wage) and wash their hands (“its not my fault gov” by blaming market forces and those pesky foreigners who work for nothing and who would otherwise steal British jobs. And despite a huge wave of support for the concept of a living wage and the welcome growth in employers (said to be over 1000 and growing) signing up to be living wage employers this picture is largely illusory.

    For instance, while it is hugely important from a marketing perspective to be able to list firms such as Barclays Bank as living wage employers, it is important also to have some knowledge about how many employees were already receiving a living wage or more? Without that information how can Tom or the Living wage Foundation know how many workers benefit from the banks apparent generosity and concern for the well-being of its low paid employees? Significantly also, we had no stats about outsourcing at Barclays or any other of the agencies that have signed up as living wage employers.

    Most important of all, there was no mention of the avalanche of living wage jobs (public and private sector) that have, are and are going to be lost, outsourced and exchanged for minimum wage (or less) and zero contracts? So we got the good news but not the whole picture.

    The only thing that Tom was firm about was that it was a voluntary scheme, full-stop. So while the work of the Living Wage Foundation might be good news for the few (a very few) in the general scheme of things it is very small beer and is a smoke screen for what is really going on in the world of work.

    Tom outlined some imaginative ways that UK citizens have publicised the campaign such as buying shares to allow lowly cleaners to attend company AGM’s and put their case in the corridors of power. He also told us about ingenious plans to name and shame and Asda into signing up as a living wage employer. But while these plans might be inventive marketing tools and great theater and a brilliant way of getting some more publicity for the living wage campaign, anyone who knows anything about ASDA and the economics of the retail industry knows full well that this is pure wishful thinking and is not going to happen. In reality the reverse is happening daily in ASDA and throughout the retail trade and other sectors.

    Labour Local Authorities

    For instances, my own local authority, York, has this year announced, to great fanfare, that it is now a living wage employer, with the leader of the council basking in the reflected glory of his and the local Labour Party’s largesse and compassion for its low paid employees, while at the same time outsourcing thousands of living wage care jobs and other contracts to the private sector usually for the lowest possible cost.. Some might think this hypocritical and politically dishonest. In this regard, and following a council budget cut of £12 million for 2015, I have this morning just received my 2015 council tax notification headlined:
    “Making Tough Decisions Now to Secure the Future”

    So there we have it, my local Labour local authority is a conduit for Coalition cuts with the victims of its tough decisions being public sector workers, the working poor, disabled, excluded and the most vulnerable York citizens.

    The High Street

    In the week since the ILP discussion we have had news that not one major high street store is a living wage employer and that the Tory Lord, Baron Wolfson of Asplay Guise (CEO of NEXT) who’s hourly income is said to be £350 per hour thinks that the £6.70 per hour starting rate for Next employees, is a living wage. As Mandy Rice-Davies famously said, “Well he would say that, wouldn’t he?”. And it truth none of the major retail companies are going to become “Turkey’s voting for Christmas” and voluntarily sign up as a living wage employer because they know and we all know and the politicians and economists all know that to do so would be, in effect, to transfer market share and profits to their competitors.

    Statutory Living Wage

    But we should also bear in mind that had the NMW been increased by the rate of inflation since its introduction by the Blair government in April 1999 it would now be worth much more than the current UK living wage and be over £9.00 per hour.

    And if that had happened, just think of the billions of extra spending power the working poor would have had over these years and the trillions of inward investment that might have gone into the regeneration of deprived neighbourhood communities and infrastructure programmes instead of being hovered up by the city of London, bond and currency traders, the super-rich and lying in foreign bank accounts or in property portfolios pushing up house prices and rents and in subsidizing big corporations such Amazon, Starbucks and Asda and the ubiquitous private employment agencies who routinely use rouses to get around paying the NMW. And perhaps there would have been no need for the Tory austerity measures and the excuse by our Westminster politicians (Tory, Liberal & Labour) to cut public services, to privatise everything standing and to trash our welfare state.

    So while the work of the Living Wage Foundation is not insignificant and very welcome, with tens of thousands of working people getting a much needed boost to their incomes, it is important, I think, to paint a much fuller and realistic picture about what is happening to wages and conditions in the world of work.

    And while Tom Chigbo did a really good job in standing in for Professor Jane Willis who was ill, the case for a statutory living wage is, to my mind, an essential pre-condition if there is ever to be balance and fairness for millions of working people.

  11. Ben Saltonstall
    21 March 2015

    This is an excellent, clearly written and comprehensive summary. Thank you.

    To add to the debate, let me say what I think is lacking in recent Labour Party policy. It is not just that the party has not made the most of policies to help low-paid workers. It still speaks indistinctly to the fragmented working class and in particular the self-employed amongst them. It has no compelling narrative for the exploited ‘self-employed’ and it says very little to trades people or, as they are sometimes known, ‘white van man’, some of whom are turning to UKIP. The patronising tweet from the former shadow attorney general says it all. From the outset, Labour needed to show it was the friend of small business, but has failed to do so.

    This is affecting its performance in the polls. Its narrative about declining living standards was bound to be undermined close to the general election. It was obvious that the Tories would engineer some sort of mock ‘recovery’ in the 6 months before the election, as indeed they have done.

    The Old Blairites criticism of Miliband’s lack of business credentials is not unfounded, even though it is unfair; Labour needs a hopeful message about how to put the economy back on track and help self-employed people at the same time. Their businesses are too small to compete for public contracts, and they are thus shut out of the generous system of corporate welfare that Blair and Brown did so much to enhance. Labour needs to show it is the friend not only of innovation, but of everyday businesses, like cafes, hairdressers, plumbers et al.

    It should also do a lot more to crack down on the exploitation of agency workers. If it did this, it would help defuse some of the understandable concerns that working class people have about mass immigration from former communist countries which have acceded to the EU, without having to adopt reactionary policies about cracking down on phantom Eastern European welfare benefit cheats.

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