Ed Miliband says that the Living Wage is about rewarding hard working people.
The plans for the Living Wage may do more harm than good, thinks the Director General of the Institute of Economic Affairs.
Mark Littlewood said:
– Mark Littlewood, Director General of the Institute of Economic Affairs
The so-called living wage may do more harm than good.
Highly successful, blue chip companies may well be able to sign up to the scheme fairly effortlessly.
Public authorities can also do so and simply pass the bill on to the taxpayer.
There is, however, a danger that naming and shaming companies unable to meet higher wages will depress job creation particularly in the poorer parts of the UK.
London is singled out for special treatment, but it is assumed that there are no differences between Bradford and Bath or between Winchester and Wolverhampton.
This is evidently absurd.
Downing Street has said the Government supports the Living Wage initiative but insisted that companies would not be made to bring it in against their will.
– Prime Minister's official spokesman
We back the idea of a living wage and we encourage businesses to take it up.
[But] we are not proposing to require it for businesses.
The Federation of Small Businesses (FSB) has insisted that its members want to pay their employees a higher salary, but argued that they are "struggling" with cash flow in the current economic climate.
Companies are under pressure to pay staff the Living Wage - which was increased today to £8.55 in London and £7.45 elsewhere - following campaigning by London mayor Boris Johnson and Labour leader Ed Miliband.
– FSB national chairman John Walker
Small firms want to pay their employees more, and recognise the benefits of doing so. However, they are struggling to manage cash-flow in the midst of weak economic demand and increasing energy and fuel costs.
ITV News followers on Facebook have been reacting to Labour leader Ed Miliband’s attempt to encourage companies to pay the Living Wage, which was increased today to £8.55 in London and £7.45 elsewhere.
– Wayne Baker
I think the unemployed should work for the payout if they have been out of work for more than six months… As a business owner trying to make a go of things, I get zero benefits even though I have had no income for the last three months.
– Kaz Langley
It’s not about paying a higher wage - bring down the cost of living that would make the difference - small businesses won't be able to afford that and will have to close.
– Mrs Julie Wickenden (via email)
As the manager of an organisation caring for the elderly, we would dearly love to pay our staff the recommended living wage.
To employ one carer for 24 hours on this wage with pension and national insurance would cost us £201.84.
The government pay us £47.66 per day to care for each elderly resident. Some things just don't add up.
The Scottish Government has renewed its commitment to the Living Wage after the rate was increased from £7.20 to £7.45.
The requirement to pay the Living Wage was introduced in the Scottish Government's pay policy in 2011-12 and the new rate will apply from April next year.
– Scottish Finance Secretary John Swinney
We fully support the principles of the Living Wage Campaign, which encourages all employers to reward their staff fairly. That is why the commitment to pay the Living Wage is part of the Scottish Government's public sector pay policy for the third year running.
The Scottish Government has control over the pay for most civil servants in central government, government agencies, non-departmental public bodies and the NHS.
London mayor Boris Johnson has called on more businesses in the capital to sign up to the Living Wage initiative.
The rate in the capital was increased from £8.30 to £8.55 today.
– Boris Johnson, London Mayor
We have a huge range of household names on board and I want to see more coming forward. I’m sure that the new Living Wage Foundation trademark will become a fantastic badge of honour for the capital’s employers and add further momentum to a campaign I wholeheartedly support.
The TUC has called for more employers to pay the Living Wage so that millions of workers can benefit from the initiative.
It was announced this morning that the new rate of Living Wage is £8.55 an hour in London and £7.45 elsewhere - both rates having been increased by 25p.
– TUC General Secretary Designate Frances O’Grady
We commend those employers who have already signed up to it.
However, it is essential that more companies follow suit. We want millions to benefit from a living wage, not thousands. It is simply not good enough for large companies to plead poverty at a time when their cash reserves are increasing.
The new Living Wage for London has been set at £8.55 per hour, a 25p increase on the previous figure. The national 'living wage' has also been increased by that amount - from £7.20 to £7.45.
Mayor announces £8.55 per hour is the new figure of the London Living Wage(LLW)
The Joseph Rowntree Foundation sets a new Living Wage annually and this year's rate is £7.45, a 25p increase.
Ed Miliband will make a speech later this morning to set out the case for companies to pay the Living Wage.