National Minimum Wage

Part of Opposition Day — [6th Allotted Day] – in the House of Commons at 2:08 pm on 15th October 2014.

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Photo of Karen Buck Karen Buck Labour, Westminster North 2:08 pm, 15th October 2014

I think I understand the point. We will consider, and make a decision on, those proposals that are put in front of us. They will not necessarily be the proposals that have been put in front of us by a Conservative party conference. It is extremely important to look at tax credits in the round as well as at other changes to the tax system to ensure that we are helping not just those on low incomes through tax thresholds but those who have children so that they have a chance of a decent standard of living too.

Another related point is that low pay has caught people in in-work benefits and added to the benefit bill. The low-wage economy has led to an enormous increase not only in the number of working people claiming in-work benefits such as housing benefit, but in the total expenditure. For example, we have seen a £4 billion increase in housing benefit— that is despite the fact that the Government have made cuts to the total level of housing benefit—as more people are forced into making claims to make ends meet. Indeed, the number of working households needing housing benefit has already increased by 22% and is expected to double over the coming years.

To ensure that we have a sustained recovery and that we tackle the cost of living crisis, help people on low pay and cut the benefits bill, we need to do something about low pay. That is why I so warmly welcome what my hon. Friends on the Front Bench have said about tackling the minimum wage, delivering the “make work pay” contracts, and helping and supporting employers to pay the London living wage, which was set at £8.80 in 2013-14. That will ensure that Londoners can enjoy the full fruits of economic growth as it now belatedly returns.

Where possible—we know that this will not apply to every single sector of the economy—employers should be able to pass on the benefits of the recovery to employees, and in so doing ensure that the additional costs of in-work benefits are offset, so that we can make a contribution to the Treasury. We know that the minimum wage is only one component in a package that will do something to end the cost of living crisis. I welcome the proposals that will ensure rent stability for London renters who have been dealing with this enormous burden of increased housing costs, and the measures to tackle energy costs that have so burdened low-income households over the past few years. The minimum wage may be only one component of the package, but it is a vital one. I very much welcome today’s motion and look forward to voting for it.