Scottish Government responds to Low Pay Commission consultation

Ahead of Scotland’s first Living Wage Expo, ministers have expressed disappointment with the UK government’s plans for a ‘national living wage’. UK wage plan ‘not a Living Wage’

Yesterday the minimum wage increased by 20p to £6.70 per hour (£12.2k per annum) . The new rates comes into force ahead of the planned national living wage of £7.20 an hour (£13.1k) for over-25s from next April.

– Statutory figure for 18-20 year olds has risen by 17p to £5.30 an hour (£9.6k)

– Pay for under 18s has increased by 8p to £3.87 (£7k)

– Apprenticeship rates rising to £3.30 (£6k)

The Living Wage Foundation says the real living wage in London is £9.15 per hour (£16.7k) and outside London £7.85 (£14.3k) per hour. The average hourly salary in the UK is £14.56 (26.5k).

Scottish Cabinet Secretary for Fair Work, Skills and Training Roseanna Cunningham has written to the Low Pay Commission as part of its consultation on the plan and highlighted the following key points:

– The phrase ‘national living wage’ is in itself a misappropriation of the term which risks harming moves towards fairer pay

– The plan discriminates against the under-25s

– Further complications and inequalities will be brought into the National Minimum Wage structure

– The UK Government plan brings into question the future role of the Low Pay Commission itself as the plan could devalue the body’s role

– Payment of the current Living Wage rate of £7.85 should be a priority, with over 300 Scottish organisations currently accredited.

Ms Cunningham said: “The so-called ‘national living wage’ announced in the UK Government budget is not a Living Wage, and should not be referred to as such. It is simply an enhancement of the National Minimum Wage which disgracefully discriminates against the under 25s.

“Employers also do not need further complications in the National Minimum Wage structure and I would encourage all bodies looking at this to ensure that younger workers are treated fairly.

“We are working hard to increase the number of employers paying the Living Wage. By this I mean the real Living Wage, which is calculated according to the cost of living. There are now over 300 organisations across Scotland that recognise the tangible benefits to their business of being accredited, huge progress in the last 12 months.

“I have made these points very clear in the Scottish Government’s submission to the Low Pay Commission, whose very future should be seen as under threat from the UK government plan. The UK Government’s decision to set an arbitrary rate for this ‘national living wage’ fundamentally challenges the value of having an organisation providing independent advice on wage levels across the UK.

“I call upon the UK government to set out a clear plan for moving towards a real Living Wage for all – a wage that truly reflects the cost of living.”