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Unions call on businesses to back £7.20 hourly wage

By Western Morning News  |  Posted: July 02, 2012

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Union organisers in the South West are calling on employers to increase wages in order to stimulate the local economy.

According to South West TUC, companies should be paying their employees at least £7.20 an hour instead of the current national minimum wage of £6.08. It contends the gesture would boost economic growth and morale amongst workers.

While Westcountry business leaders welcomed the move overall they urged caution over a "one-size fits-all" approach to wages.

The call from unions comes after trade unionists from across the region gathered on Saturday in Bristol for their regional council meeting.

High on the agenda was a talk about a successful campaign by the union to introduce the living wage at Newcastle City Council.

The TUC said the living wage was calculated according to the basic cost of living in the UK.

Nigel Costley, regional secretary for the South West TUC, said it was time other areas followed the Newcastle example.

He said: "Now is the time for a living wage to be introduced in the South West.

"What the local economy needs is a boost and encouraging consumer spending, particularly among low-paid workers, is a good way to do it.

"A living wage would close the gap between luxury pay at one end of the scale and poverty pay at the other.

"Paying the living wage is good for business, good for the individual and good for society."

Mr Costley said the union was looking to big employers in the public and private sector to make the first move in the hope smaller firms would follow their lead.

He said: "By and large smaller businesses pay a better rate for a decent day's work than the larger employers do, so this shouldn't affect smaller firms."

Tim Jones, chairman of Devon and Cornwall Business Council, said: "In principle we broadly welcome this policy by the unions because it will obviously feed into the local economy and will benefit all.

"However, there are some sectors – retail and construction being the main ones – who are really struggling and the moment and any increases could bring problems.

"A sliding-scale is needed as opposed to a one-size fits-all approach."

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  • josdave  |  July 04 2012, 8:52AM

    I seem to remember the outcry from Tories and businesses when the minimum wage was first proposed. It would ruin businesses and put up inflation when in fact it did neither of those things but just made it more difficult for employers to exploit the lower paid workers.

  • Doitdreckley  |  July 02 2012, 8:15PM

    This is the same Tim Jones who wants regional public sector pay. The guy needs to make up his mind.

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  • Phil_lip  |  July 02 2012, 2:52PM

    Yes youngcornwall if a cap wasn't put on the hundreds of millions of pounds the larger suppliers/manufacturers make when they sell down through the levels finally to the customer, giving everyone a smaller slice of the pie. It is called a moral profit instead of an economic one. You have to remember that a company like Ambrosia for instance, is owned by Princess foods if I recall correctly and they are owned by someone else, then them by someone else, they all get a slice of the pie but the top tier company is the one that makes the highest profit and if that was capped then more could be fed back down through the chain to the employees on the ground floor. I hate to use the word but it is sustainable economics instead of capitalist economics that can only exist with debt as its core growth component. This would bring growth back into the markets at street level, people would be more comfortable spending and in the long term this would raise the profits for the top tier companies anyway.

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  • youngcornwall  |  July 02 2012, 1:54PM

    The employers can pay as much as £10 an hour or more, it will only get passed on to the consumers and they end up paying the increase at the end of the day, until they get wise and start going somewhere else.

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  • Phil_lip  |  July 02 2012, 1:27PM

    £12.50 is the alleged average wage in the UK (£26,000 a year inc. paid holiday, or £20,020 after current tax and NI) and if they think £7.20 should be the new level of entrapment wage then they are mistaken, that would earn you £14,976 a year, but let's not forget the tax increase that is going to happen next year because of lifting the threshold to £10k. It is approx 23% of earnings that go on tax and NI at the moment, so this would leave the majority of people who have to live on minimum wage, if they are lucky enough to be earning a full time wage with it £11,531 to live on. If you are a single person in a rented flat in Cornwall then you would be paying around £700 a year for Council tax, £354 for water, £1,040 on gas and elec (if lucky), approx £150 for TV license, £300 for landline and internet, then you have rent which is high on average in Cornwall thanks to tourism, and £450 a month would be a lucky find for a one bedroom flat (not even taking into account fees from letting agencies) at £5,400, so in total so far the cost of living is £7,944 and that doesn't take into account a car, mobile phone, food and clothing which you would only have £3,587 to live on a year, or £298.92 a month, or £9.83 a day. Let's not forget this is a single person and if that income is needed for a family, or child then you are pretty much left in the same boat by the time they will raise taxes to cover the loss of anyone earning less than £10k when the threshold goes up, so even a 0.5% increase in tax will cripple the hard workers on the entrapment wage to the same level they were when minimum wage was at £6.20/£6.40. The only way to raise living conditions for earners is to have the minimum wage at around the £9-£10 level and for larger corporations to be capped on what they can make off the smaller businesses. Growth of 2.5%-3% that is thought of as good can only be achieved by raising the bar for the lowest earners well above that threshold, otherwise the only people it is good for are the 1%