Peter Kenyon

Labour preaches living wage, but remains wanting on public sector pay

Whenever I mouthed off as a child my parents encouraged me, in a kindly manner, to always practice what I preached. Today, I hope every member of Labour's front-bench will do likewise.

Uppermost in the minds of us labelled as the left of British politics is the victory of Syriza in yesterday's Greek general election - a victory for hope. The speed with which it concluded negotiations this morning to form a government - one hour - reinforces that message.

Syriza's leader, Alexis Tsipras, has taken political ambition to new heights, by taking on both the global neo-liberal and the Greek establishment. We all owe him heartfelt thanks. In comparison, the British Labour Party's ambitions are ambiguous to say the least. 

Most recently, its shadow works and pensions secretary, Rachel Reeves, is quoted in today's Guardian newspaper applauding the London Borough of Brent for its innovative plan to cut the business rates bill for accredited Living Wage employers within its boundaries.

Speaking at the launch, she reportedly said:

“I want councils across the country to follow Brent’s lead by cutting business rates for companies who pay their staff a Living Wage. It’s a brilliant idea to tackle low pay which is good for everyone - workers, employers and taxpayers.

“It’s a scandal that one in five people who does the right thing, works hard and contributes,  doesn’t earn enough to pay their bills. Low pay is driving up the benefits bill and leading to more Tory Welfare Waste and is making it harder to get the deficit down, with income tax receipts across the Parliament £70 billion lower than forecast in 2010.

“A Labour government will tackle low pay by raising the Minimum Wage to at least £8 hour before 2020, bringing in Make Work Pay contracts to get more workers paid a Living Wage and banning exploitative zero-hours contracts.”

Not a word about Labour's own pay policy towards the public sector other than a measly commitment to lift the National Minimum Wage (NMW) to £8/hour before 2020. Correction, that is a slight improvement on the original wording which was 'by 2020', revealed in an interview with the Observer published on 20 September 2014. 

The standfirst for that piece proclaimed:

Labour leader says he would raise minimum wage to £8 by 2020 in move that 'reveals core party values'

Those of us with economic degrees know that you don't need one to know that inflation is likely to propel the NMW towards £8/hour by 2020, if not before. That, emphatically in my view, does not reveal core Labour Party values.

Core Labour values demand a more ambitious policy towards pay. The preaching has got to stop, until a coherent pay policy is agreed. Any journalist that misses the opportunity to challenge Labour Party spox about this should go straight back to journalism school.

I set out the case for a more ambitious approach over three months ago here. It is increasingly embarrassing to have Labour Party spox encouraging businesses and local government to adopt living wage policies, but remain silent about public sector pay in central government and other public bodies.

Labour must be honest with the electorate and show that the cost-of-living crisis is going to be tackled head on in, as Labour Leader Ed Miliband said in his New Year message, a 'Recovery for All'. That could be the start of offering real hope to UK voters.

 

 

 

Living Wage - Labour reiterates carrot approach, rethink needed

If you are interested in following the proceedings in the House of Commons yesterday on the National Minimum Wage debate tabled by the Labour Party the Hansard account starts here.

Labour's spox on business Chuka Umunna reiterated the known position on the living wage:

We recognise it is very challenging for employers to pay a living wage, so we would not impose it on them by having a statutory living wage. Instead, a future Labour Government will encourage employers to pay the living wage through new “make work pay” contracts. Firms that sign up to becoming living wage employers in the first year of the next Parliament will benefit from a 12-month tax rebate of up to £1,000, and an average of £445, for every low-paid worker who gets a pay rise. This will help firms towards a higher-productivity, higher-wage model. The measure will be funded entirely from the increased tax and national insurance revenue received by the Treasury when employees receive higher wages. Additional savings in lower tax credits and benefit payments, as well as increased tax revenues in future years, will cut social security bills and help pay down the deficit. Not just ensuring people are in work but that they get a decent salary when they are working, is the most effective way to reduce the social security bill.

All very worthy, but as I wrote yesterday, the time has come to address the unwilling in business who are quite content for government to subsidise wages. It is those businesses that should be labelled scroungers, not people in work on poverty wages. Labour party branches, constituency parties and affiliated trade unions should be demanding action now.

 

Living wage: time for Labour to get serious

A significant shift in business thinking appears to be underway when it comes to pay. Guy Stallard of KPMG is a leading advocate for the living wage and serial tweeter @Guy_Stallard. Today he was egging on Labour's shadow spox for Business, Chuka Umunna, and Work and Pensions, Rachel Reeves, ahead of today's vote on Labour's plan to increase the National Minimum Wage to £8 by 2020. Stallard thinks political leaders should be congratulating Living Wage employers for doing the right thing. We won't have long to wait to see if any politician applauds those enterprises, large and small, charities, and publicly quoted that are proudly accredited living wage employers.

Today's debate highlights the feebleness of Labour's current position over pay in response to the cost of living crisis. It stems from a leadership failure to be clearly define the Labour Party's new relationship with the business communities post-crash.

Pay - a living wage - is an opportunity to be crystal clear about that new relationship. Pro-business, yes, but. There are various ways in which government can shift behaviour. It requires budgetary commitment. Government itself must become a living wage employer. That means all its contractors have to do the same, not just for the purpose of securing a particular contract, but in order to bid for government work at all.

Then there is the rest of the economy, where there are still some firms acting illegally and not even paying a NMW. There has to be a blitz on non-papers, and others who have found devious ways of cheating their employees.

Next, there are carrots. A year ago Ed Miliband promised tax breaks to reward firms that do pay a living wage, and those that need some encouragement. They would have to pay some taxes in the first place to enjoy any benefit. But that issue is outside the scope of this post.

Then there are those businesses that cry poverty. Well, handsome is as handsome does. There is no reason in practice and every reason in principle why reluctant businesses should be audited or means-tested. Failure to pay a living wage results in demands on the public purse in the form of working tax credits. It is the businesses that are the scroungers and should be clearly labelled as such, not low paid workers.

There is precedent as currently being shown in Ecuador as reported recently by Left Futures http://www.leftfutures.org/2013/02/living-wage-ecuador-shows-the-way/

Ed Miliband has an opportunity to set out this new approach in Living Wage Week early next month. Don't hold your breath.

Rejoice!

"On 18 March 2008, I posted

Living wage/fair pay - the next goal for Labour

How many Labour-controlled local authorities have adopted a living wage policy? Certainly none in London, except the Greater London Authority itself. I was discussing this with a local government  policy advisor at a Party fund-raiser last night. He gave me a technical explanation about the difficulties of enforcing a living wage in contracted-out services. Yea, yea, I thought. But what about the politics? We agreed that as the Labour Party we need to be pushing this as a campaigning issue of direct relevance to the majority of people we seek to represent. A twin-track campaign with the Fair Pay Network highlighting greed and inequality would do wonders for Labour Party morale. It might even improve Labour's electoral standing and help reverse our dismal showing in the opinion polls underlined again by the latest ICM/Guardian poll in today's Guardian.

Having proved beyond doubt the economic viability of a national minimum wage, now is the time to assert the right of all to a living wage, and challenge the obsenity of  financial sector bosses pay as we, the taxpayers, have to bail out the......financial sector for their incompetence and failures.

No doubt, this will be another political opportunity missed at this week's Labour Party National Executive Committee meeting. (It doesn't do policy!) Time to get a grip."

Today, I awoke to news that both the Leader of the Labour Party Ed Miliband writing in the Independent on Sunday, and his Blairite brother David, writing seperately in the Observer with trade union baron, Dave Prentis, are backing the idea.

That's really set me up for the next General Election. And after months of famine, something worth blogging about.

Is this going to help rally Labour for the Euro-elections?

My CLP has got two speakers tonight on the European Parliamentary elections - both candidates - Claude Moraes MEP seeking re-election at top of the Labour London regional list and Cllr Emma Jones who is also running on the London list.

I have just seen this report on the BBC News website about the Working Time Directive. I do worry about what the Labour government is thinking about? Employment Minister Pat McFaddan and Labour Party National Policy Forum chair is reported as saying:

The opt-out had worked successfully for many years and ending it would have been a "bad deal" for the UK in the midst of a recession.

Unemployment has risen above two million while thousands of employees, particularly in the car industry, have had their working hours reduced in the face of weakening demand.

"Everyone has the right to basic protections surrounding the hours that they work but it is also important that they have the right to choose those hours," he said.

"The current economic climate makes it more important than ever that people continue to have the right to put more money in their pockets by working longer hours if they choose to do so."

Wakey, wakey, Pat! People working lots of overtime are invariably people not being paid a decent rate for the job in the first place, or sometimes just plain greedy. Labour values include promoting a living income and mutual co-operation, not depressing wage levels or promoting selfishness.

Have we learned nothing after 12 years in government?

Nudge, nudge - PM said thinking about £10k tax threshold

The ruling Labour Party's NEC (as a whole) may be in the dark about the state of its own finances, its National Policy Forum may have been banned from discussing tax policy last July, so it's a relief to read courtesy of headline skimmers, fellow bloggers traced back to an exclusive in the Daily Mirror that Labour leader Gordon Brown is thinking about taking those paid less than £10k a year out of tax.

A healthy open debate in the Labour Party would have come to a similar conclusion a long time ago as a policy goal, as it did about the minimum national wage. The Conservatives shroud waving over that issue - unafffordable, loss of jobs, end-of-world - was shown to be ....just that....shroud waving. Now is the time to get a national debate going over what is a living income after tax - £10/annum tax-free seems an excellent headline catching starting point.

Recent banking developments are a vivid reminder of why it's ok for a political party in government to be able to maintain a degree of independence from the toil of ministers when it comes to shaping policy ideas. The party on the ground (as we rank-and-file members like to think of ourselves) are not there to be trodden into..the ground..but to help shape groundswells of opinion around Labour policies inspired by Labour values. When everyone in the country is either earning, receiving or being encouraged to aspire to a living income, then we will have a Labour Party worth voting back into government.  I can't think of anything more likely to mobilise people back into membership of the Labour Party and them wanting to be active.....appeals to vote Labour to stop the Tories or the BNP are not enough. We need a positive message too - a living income fits the bill. 

Labour values back on track - living wage

Comrades in Tower Hamlets Labour Group last night showed real local leadership last night by tabling a resolution at full Council, which won near unanimous support, to implement the London Living Wage. (The London Labour Party backed the idea, actively promoted by former Labour Mayor, Ken Livingstone, at its biennial conference in 2006.)

Labour-controlled Tower Hamlets Council recently elected leader Cllr Lutfur Rahman proposed the motion telling himself to get on with it. The resolution reads:

This Council:

• supports the establishment of the London Living Wage, set at a level calculated

by the Living Wage Unit to avoid poverty wages being paid in the capital;

• abhors the fact that around 400,000 Londoners continue to fall into a ‘working

poverty trap’ because their families are paid less than required to fund the basic

costs of living in London;

• calls on the Leader to review Tower Hamlets Council’s procurement, contract and

best value policies to ensure that, as far as possible within UK and EU law, the

London Living Wage, at the level set by the GLA’s Living Wage Unit, is the

minimum paid by Tower Hamlets Council and by its contractors and that all

temporary workers employed by the council are paid at least £7.45 an hour by

their agency;

• calls on the Leader to seek commitments from Tower Hamlets’ partners in the

Local Strategic Partnership to pay no less than the London Living Wage; and

• calls on the Leader to ensure that the Council’s commitment to the London Living

Wage is clearly displayed on Council headed paper, the Council website and

other appropriate locations

To the best on my knowledge Tower Hamlets is the first Labour-controlled Council to implement the London Living Wage not just for its own staff, but agency and temporary workers as well as commit to seek contract compliance as Best Value contracts come up for renewal. I believe that this latest development in promoting the 'living income' concept is the next step in Labour's commitment to end poverty in the UK. It could be used by Labour Groups in every local authority in the country to mobilise members and supporters. 

 

I live in the City of London. It is a scandal that the Corporation has refused to become a London Living Wage Employer. If Tower Hamlets can afford to, the City has no excuse. 

In defence of saving the world...banking system?

Apparently Labour's Gordon Brown is alleged to have made a gaffe in prime minister's questions today. Conservative members of parliament rolled about laughing. In the light of what we know from the Governor of the Bank of England, the state of the world banking system was extremely fragile despite US efforts to buy up toxic assets until GB stepped in with a bank recapitalisation plan. So I have no problem with his remarks. The Tories should be ashamed of themselves. Schoolboy antics in the House of Commons should not mask the deadly seriousness of the situation the world banking system was/is in, nor the Labour Party's commitment in government to do whatever is necessary to held the economy through. And yes, Mr Cameron that will involve borrowing now and paying money back later. Grow up.

(Today's Hansard when published tomorrow will no doubt be read very closely to see how a broken sentence has been recorded for posterity.)

BTW I was sorry I missed the live broadcast, but I was lobbying trade unions about the London Living Wage ahead of a Corporation of London Joint Consultative Committee. The Corporation has declined to apply to be a London Living Wage employer, which has some of us wondering, when City firms are signing up.

A step in the right direction - taking on the Tories

This is a definite step in the right direction reminding everyone what life was like under the Tories pre-1997. But as I have just posted the Tories have already got wise to this and have Boris backing the London living wage - introduced by former Labour Mayor Ken Livingstone. Labour has to trump this pdq. It will take more than a radical Autumn statement to shift public opinion. We have got to have a vigorous campaign on the ground for a living WAGE with Labour-controlled councils leading the way and every Tory and Lib-Dem controlled council under siege, and a living INCOME for everyone on low and middle incomes for whatever reason - retirement, unemployment, disability, caring or incapacity.

Taking on the Tories with a living income strategy

I've just been researching progress with the London Living Wage for a letter I'm drafting to Stuart Fraser, newly elected chair of the City of London Corporation's Policy and Resources committee. (In any other local authority he would be the Leader). The Corporation's chief executive thinks its would compromise the City's 'independence' to formally become a London Living wage employer. This is surprising given that London's elected Mayor Boris Johnson has already embraced the London Living Wage developed by trade unionists and the apolitical community-based organisation, London Citizens.

I approached Ken Livingstone during his ill-fated attempt to win a third term as elected Mayor to ask why he wasn't making more of this issue to win support in London. After all it was adopted as London Labour Policy at its Bienniel Conference nearly two years ago. "The trouble is, none of the Labour controlled boroughs have followed suit", he told me.

We have got to get real about this issue. If Tory-controlled Ealing Council can adopt the London Living Wage in key contracts, what are London Labour-controlled councils waiting for?

Everyone is being affected by rising living costs outside government control, not just those in employment, Labour has a responsibility to everyone on low and middle incomes. This should be the campaigning issue to rally the Party, not the personal ambitions of over-inflated egos in Cabinet.

To trump the Tories, Labour is going to need to raise the stakes by getting busy setting out its plans, not just for a living wage, for a living income town-by-town, city-by-city, region-by region pdq, and in tandem rebuilding the Party from the grassroots.