March 17, 2015 : Jenny Bloomfield
An end to in-work poverty?In the week where the UK Government has announced a 3% increase in the minimum wage, and a 20% increase in the minimum wage for apprentices, we ask whether we will soon see an end to in-work poverty.
Today the UK Government announced an increase in the minimum wage from October, to £6.70 for those over 21, and with a comparable 3% rise for younger workers. In a surprise departure from the Low Pay Commission’s recommendations on the minimum wage rate, the Government also announced a 20% rise in the level for apprentices – although this will still only see it reach a rate of £3.30 and hour.
Given that Living Wage, deemed to be the rate that people need to earn to be able to cover the basic costs of living, is currently at £7.85 an hour, I don’t think we should be getting too excited. But it is interesting to see the positive shift over the past few years around the argument for increased wages at the bottom.
And it’s not just UK politicians who are talking about this. Yesterday the Scottish Labour leader Jim Murphy pledged to end low pay in Scotland, while First Minister Nicola Sturgeon urged the Chancellor to increase the level of earnings people are allowed to keep before they start losing benefits.
“our own sector is struggling to pay a decent wage”
We also have a new Scottish Government report into poverty and the Scottish Greens calling for an increase in the minimum wage to £10 an hour. The Independents and Green group at the Scottish Parliament are also holding a debate in Holyrood on in-work poverty tomorrow (which we’ve produced a briefing on). So all in all there’s certainly plenty of talk.
The worry is of course that there will be little action beyond tweaks to the minimum wage rate. And certainly our own sector seems to be struggling with how to pay people a decent wage. But with two elections coming up – the general election in May this year and the Scottish election next year – I’m hopeful that we will continue to see positive actions and pledges from all parties on pay and related issues in the coming months. And who knows, over the next few years we might see an end to in-work poverty. What’s not to like?