Employment

Sunak must raise minimum wage again to ease cost of living crisis, say unions 

New official figures show that wages dropped in real terms by 2 per cent, with the sharpest monthly fall in public sector real wages on record.

The Chancellor Rishi Sunak runs through his Spring Statement speech in his offices in 11 Downing Street

The Chancellor Rishi Sunak runs through his Spring Statement speech in his offices in 11 Downing Street. Image: HMTreasury/Flickr

Unions are calling on the government to raise the national minimum wage, again, as the 6.6 per cent increase announcement back in October 2021 isn’t enough to keep up with the spiralling cost of living

TUC General Secretary Frances O’Grady implored the chancellor to return to parliament with an “Emergency Budget” to help people through the cost of living crisis that is seeing food banks at breaking point and a third of Brits already in or looking for multiple jobs to make ends meet.

“Rishi Sunak should immediately boost the national minimum wage, universal credit and pensions. And he should bring down energy bills by using a windfall tax to fund grants – not loans,” O’Grady continued. 

Average earnings including bonuses grew by 5.4 percent according to new data released by The Office for National Statistics and despite this figure including bonuses, this failed to keep up with 6.2 per cent rise in the consumer price index, in February. The Office for Budget Responsibility expects inflation to reach a 40-year high of nearly 9 per cent when the energy price cap rises again this winter.

For those who don’t receive bonuses, pay grew by 4 per cent on average over the past year, but that puts it below inflation, and amounts to a real terms cut of 2 per cent to wages. 

Chancellor Rishi Sunak called his increase to the national living wage back in October 2021 the largest ever, going up by 6.6 per cent from £8.91 to £9.50. 

The Living Wage Foundation calculated in November 2021 that the minimum amount a person needs to afford to live is £9.90 across the UK and £11.05 in London

Spain increased its national minimum wage for a second time in less than six months on January 1 2021, while all taxpayers in Germany will receive a one-off €300 payment to help with the rising cost of living.

The Union of Shop, Distributive and Allied Workers warned in October that the new minimum wage rise would not provide enough for people to live off, calling on the government to raise it to at least £10 per hour. 

The union is also calling for an end to “unjust rip-off youth rates” which see people aged 18 paid £2.67 per hour less than someone aged 23 for the same job. 

Workers aged 21 or 22 must be paid a minimum of £9.18 per hour, decreasing to £6.83 for 18 to 20 year olds, while under-18s and apprentices get £4.81.

“We provided the Low Pay Commission with evidence of why we need a new deal for workers, which includes at least £10 per hour and an end to unjust rip-off youth rates ” said Paddy Lillis USDAW general secretary.

“Going to work should mean a decent standard of living for all workers, not least young workers. They are more likely to be paid less than older colleagues, even when doing the same job… It is deeply disappointing that  minimum wage rates continue to discriminate by age,” Lillis continued. 

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