Living Wage Debate

At the Suffolk County Council meeting on Thursday the Labour Party put down a motion that, in essence, would have meant the council committing itself to impose payment of the Living Wage on all our contractors.

The Living Wage is, like the minimum wage, a calculated wage per hour.  At present it amounts to £7.65. This compares with £6.50 (from October) for the minimum wage, which, of course is the lowest level at which it is legal to employ anyone over the age of 25.  The Living Wage has been described by the BBC as the minimum amount necessary for a worker to live ‘a decent life’.  Its payment has much political support, but many employers are against it, arguing that it will cause job losses and damage competitiveness.

Who would not, all things being equal, not wish to improve the lot of the poorest workers in our society? In June Suffolk County Council agreed to pay the Living Wage to all directly employed staff, costing us £113,000 and affecting the wage packets of 90 people.   However, in the debate on Thursday, I was obliged to argue that to extend this requirement to our contractors would in current financially constrained times be unaffordable, potentially costing us millions, if not over ten million pounds, in additional contracting costs.

Our social care activities would be put under most pressure. This area, which is largely delivered through contractors, is already in difficulty due to the constantly increasing demand for services for the elderly.  Recognising this, the Government some time ago decreed that a solution could be achieved if the National Health Service worked with us to cut costs by closer co-operation.  Funds, belonging to the Health Service,(The Better Care Fund), were earmarked for this purpose, but, due to cost pressures within the NHS, it has been very difficult to access these.  It should be added here that, somewhat disingenuously, the Government made no new funding available, hoping that a cash strapped health service would see the cost benefits to them and simply hand over the money.

Unsurprisingly this hope has not, by and large, been fulfilled.  Cuts to our own budgets means that we have no additional resources to contribute to this area, and there is a real danger that spending on care, which we are obliged by statute to deliver, will start to devour resources committed to all our other services.  These are services which are already being reorganised to avoid further cutbacks in funding.  Libraries, children’s services, transport all come to mind.

There are other, more ideologically based, reasons for not wishing to comply.

As I said in the debate: to agree to the motion would result in the addition of another uncontrollable externally imposed commitment to the already enormous, burden of red tape and regulation that we put up with on a daily basis,   It would also represent unwarranted meddling in the businesses and competitive positions of the independent companies on whom we rely for service delivery.

In the event the motion was defeated by, I believe, 41 to 21 with 2 abstentions.  All the Conservatives voted against and, I think, most of the independents and the Liberal Democrats.