The government must raise minimum wage ‘lifeline', says TUC

date: 6 November 2012

embargo: 00:01 hours Wednesday 7 November 2012

The TUC warned today (Wednesday) that low-paid workers risk being left further behind unless the government increases the National Minimum Wage next year and ensures that it at least keeps pace with inflation and average earnings growth.

The TUC, which will later this morning present evidence to the Low Pay Commission on the level it would like to see the minimum wage set at next year, says that with ongoing cuts to tax-credits and benefits the incomes of hard-pressed families are being squeezed even tighter. As a result an increasing number of households are relying upon the minimum wage to make ends meet.

Despite inflation currently running at 2.6 per cent the government last month announced a minimum wage increase of just 1.8 per cent for adults and a freeze in the rate for younger people. This has resulted in a real-terms pay cut for around 940,000 minimum wage workers.

With the economy forecast to grow over the next year and average earnings expected to increase the TUC believes that there is more room for the minimum wage to rise above inflation next year.

The TUC will also repeat its call for companies that flout the minimum wage to be publicly named and shamed.

TUC General Secretary Designate Frances O'Grady said: 'Last month's minimum wage increase amounted to a real-terms pay cut for hundreds of thousands of low-paid workers.

'With many hard-pressed families facing cuts to their benefits and tax credits, the minimum wage is becoming even more of a vital lifeline. At the very least it needs to keep pace with inflation.

'Last month's growth forecasts show there will be more capacity to increase the minimum wage rates in 2013 and the Low Pay Commission must be bolder with the rates it puts to ministers. As the economy recovers larger rises will be needed.

'In addition, minimum wage enforcement needs to be more visible. The minority of employers who deliberately set out to cheat workers and undercut honest businesses must be publicly named and shamed.'

NOTES TO EDITORS:

-The Low Pay Commission is currently considering the rates to apply from 1 October 2013 onwards. The Commission will report to the government in February and the government will announce its decision in March 2013. As part of its evidence gathering programme, the Commission holds a two-day oral evidence session in November each year in order to quiz the TUC, CBI and others on their views on the development of the minimum wage in the following year.

-The current minimum rates:

£6.19 - adult aged 21 or above

£4.98 - aged 18-20

£3.68 - aged 16-17 (16 year olds above statutory school leaving age only)

£2.65 - apprentices aged under 19, or over 19 but still in the first twelve months of their apprenticeship. All other apprentices must be paid the relevant age-based rate.

- All TUC press releases can be found at www.tuc.org.uk

- Follow the TUC on Twitter: @tucnews

Contacts:

Media enquiries:
Liz Chinchen T: 020 7467 1248 M: 07778 158175 E: media@tuc.org.uk
Rob Holdsworth T: 020 7467 1372 M: 07717 531150 E: rholdsworth@tuc.org.uk
Alex Rossiter T: 020 7467 1337 M: 07887 572130 E: arossiter@tuc.org.uk