#032 Hell or High Wages
It’s Time To Legislate For A £12.50 Per Hour, U.K. Wide, Minimum Wage Floor, For All Adult Workers, Straight After The Next Election
Right now, following over 12 years of conservative government in Britain, inflation is over 10% and rising, energy costs are increasing so much the government have had to step in to hold down prices, food prices and surging and rents are rising at record rates.
At the same time, in England, workers are suffering a record real terms pay fall of 4.1%, in the three months to June 2022, the highest fall on record when inflation is taken into account, and the ninth consecutive month-on-month drop in real terms pay. Only the trade union movement and the Green Party are truly championing the idea that workers in Britain need significant pay rises to ensure they are not made poorer in real terms, through this cost of living nightmare, and to ensure people have some hope of paying their bills and we can revive our flat lining economy.
In response I propose the state legislates for a £12.50 per hour U.K. wide legally enforced minimum wage floor, for all adult workers, 18 and above, straight after the next election. This higher minimum wage would equate to £26k a year salary, based on a 40 hour week job, and would also mean all jobs that currently command a higher salary than the legal minimum, move to higher remuneration levels accordingly, to maintain the skill & experience level wage hierarchy we currently see across all industries in the U.K. This means the average wage in the U.K., currently £13.57 per hour, would increase significantly.
A £12.50 per hour U.K. wide legally enforced minimum wage floor would help all workers, particularly those at the lower end of the income spectrum, to get through the unprecedented cost of living crisis. Alongside other measures, such as those to curb price increases and those which protect benefit claimants and pensioners, it could go a long way to combat the cost of living crisis for working people.
“A single person needs to earn £25,500 a year to reach a minimum acceptable standard of living in 2022.” (The Joseph Rowntree Foundation Report)
The higher minimum wage would have several advantages beyond the obvious advantage that it would effectively reduce and combat a large portion of in work poverty in this country. It would also increase the tax and national insurance take, it would decrease subsidies for low wages the tax payer currently pays via in work benefit payments, as people who work would be less likely to need their wages topped up, and it would be affordable for most U.K. wide businesses, some of whom may struggle with the larger increase a £15 or even £16 minimum wage by 2025, which some are currently calling for.
At the 2019 election, the Green Party proposed a £12 per hour minimum wage https://www.greenparty.org.uk/news/2019/11/17/green-party-to-increase-living-wage-to-%C2%A312-for-all-workers-over-the-age-of-16/, to be phased in over two years. In 2022, the Green Party went further and voted for a £15 minimum wage for all workers, at their Autumn conference, as inflation, energy and housing costs were all significantly higher than in 2019.
It’s time the wider progressive movement, alongside the Labour, SNP and Liberal Democrat political parties embrace such a policy, as a way of helping British people take on the cost of living crisis from spiralling out of control.
Given the U.K., in 2022, has undergone the worst period of average wage growth for generations, this policy would help compensate and counter balance the economic situation low and middle earners now find themselves in. It would similarly show the government of 2024/2025 is recognising the hardship faced by British workers since the last election and the turn of this decade and the last.
Whilst companies like Lidl & Aldi should be commended for increasing pay, https://www.theguardian.com/business/2022/oct/28/aldi-increases-staff-pay-for-third-time-this-year-as-cost-of-living-soars, it is still not enough.
Alongside the £12.50 U.K. wide minimum, I propose an important 20% compulsory London weighting for all London workers in London businesses, across all sectors, to compensate workers for the higher costs of living in the capital, particularly the higher cost of housing. This would mean a minimum wage of £15 per hour in London, in line with motions carried at both Labour Party and Green Party conferences in 2022, if the minimum level in the rest of the country was brought up to £12.50 at the next election.
Businesses in London have a distinct advantage, generally speaking, in being able to access more people and doing more business than their counterparts outside of the capital, so economically this can be justified, with potential tax break support for smaller business in the capital that may struggle in addition.
The rise should not stop there, the minimum wage floor should continue to rise as Britain’s growth picks up and inflation & energy prices fall back.
The Trades Union Congress (TUC) have recently also called for a U.K. wide £15 minimum wage, to be in place in Britain, by at least 2030.
In 2015 I wrote about the living wage and how the government’s measures were deceptive and insufficient - https://progressiveprimers.medium.com/lies-lidl-and-the-living-wage-2c2aa8fa6bc1, now 7 years later, the problem of low pay when set against living costs, has deepened significantly and it is imperative the progressive forces in British society demand action be taken as soon as possible.