The Government could drastically increase the amount of workers on living wage by raising the salaries of some of its own workers, like those in the care industry, the Archbishop of York has told Good Morning Britain.
Dr John Semantu dismissed suggestions raising the minimum wage to a living salary would prove too difficult for businesses and said:
"The Government is one of the biggest employers so if they really want to do it, for example in the care industry, the Government could...increase the kind of budgets, then it is quite possible people could be paid a living wage."
Raising salaries to the Living Wage does not take into account "the effects in wages might have on the job opportunities of the lowest paid," according to the Business Secretary.
Vince Cable hinted raising salaries to the Living Wage may have a detrimental effect on low-paid workers and said:
The Government supports businesses who voluntarily pay the Living Wage where it is affordable and doesn't cost jobs.
Unlike the minimum wage, which is carefully set by the independent Low Pay Commission, the Living Wage does not take into account the effect rises in wages might have on the job opportunities of the lowest paid.
To increase living standards, the Government has cut taxes making the average person £800 better off and taking 3.2m people out of tax all together, and from this October, those on the national minimum wage will see the first real increase in take home pay since 2008.
A year-long study from the Living Wage Commission urged the Government to implement a series of "low cost" measures, such as higher tax revenues and reduced in-work benefits.
Commission chair, the Archbishop of York John Sentamu, said the measures would help raise the salaries of half a million public sector workers.
Professional service firms such as accountancy, banks and construction companies could boost the pay of 375,000 workers if they agreed to pay the Living Wage, currently set at £8.80 an hour in London and £7.65 elsewhere, compared to the national minimum wage of £6.31, said the report.
The commission, made up of business, union and voluntary sector leaders, warned a failure to extend the Living Wage would mean families continuing to rely on food banks and "unsustainable debt" to get by.