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Monday, 26 January 2015

Labour Brent to cut tax for living wage employers

Labour controlled Brent Council are set to be first council in the country to cut business rates for firms paying Living Wage. The Labour party are not proposing to put this policy in their 2015 election manifesto, although the party point out they are committed to increasing the minimum wage to £8 an hour by 2020. 

Speaking at the launch of the first business rate discount scheme for employers paying the Living Wage in Brent, Labour's Shadow Secretary of State for Work and Pensions, Rachel Reeves MP 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.

"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." Ms Reeves added. 

With the Labour pledge on raising minimum wage, the Tory leader, David Cameron recently accused Labour of proposing to "cut the minimum wage" by 2020 as the government say the minimum wage is projected to be £8.15 by 2020. Labour leader Ed Miliband has also promised to tackle abuse of zero-hour contracts by forcing employers to put staff on permanent hours after a certain time but he has not pledged to outlaw them completely.

The Green party is going much further than Labour and calling for the minimum wage of £6.50 to be immediately raised to the level of the living wage, which is £7.85 for everywhere except London, where it is £9.15. The Greens pledge that the different levels of minimum wage for young people and adults to be abolished, leading to a £10 minimum wage for all by 2020. The Greens said the rate should then be linked to living costs to ensure that it rises alongside inflation.

Raising the minimum wage to living wage levels would benefit an estimated 5.2 million people – 17% of the working population – and bring in a "fairer society where fewer workers are trapped in poverty pay conditions", the party says. The greens have also proposed a ban on zero hour contracts.