London Living Wage Week

Questions to the Mayor of London – answered on 29th November 2021.

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Photo of Marina Ahmad Marina Ahmad Labour

This week is the 20th anniversary of Living Wage Week. The real London Living Wage reflects the increased cost of living in the capital compared to the rest of the country. What impact does a real London Living Wage have on London’s businesses and the employees who receive it?

Photo of Sadiq Khan Sadiq Khan Mayor of London

Can I thank the Member for her question, particularly pertinent this week. The 20th anniversary of Living Wage Week is well worth celebrating across the United Kingdom (UK) and especially in London. This week I announced the new London Living Wage rate of £11.05 an hour. The number of London Living Wage employers has quadrupled since I was elected in 2016. I am proud that over 2,400 of the country’s 9,000 accredited living wage employers are based in London, where the campaign began 20 years ago.

This growth is testament to the efforts of so many workers, community groups and employers. The London Living Wage is making a profound contribution to the standard of living and wellbeing of thousands of Londoners and their families. Over 100,000 Londoners received a pay rise when the new rate was announced this week. Living Wage employers report they are able to attract, recruit and retain the best talent, and that their employees are happier and more productive at work. Paying the Living Wage makes good business sense.

I have put the Living Wage at the heart of my Good Work Standard, which sets the benchmark for good employment practice in London. Over 235,000 Londoners work for our 100 accredited Good Work Standard employers covering sectors as diverse as retail, construction, transport, health, local government, media, charities, law and finance. They all recognise that good work starts with their pay. Despite these successes, we still have a long way to go. One in five jobs in London pays less than the Living Wage. Therefore, we need to get out there and make the case for more employers to sign up.

This week, I also announced London’s plans to become a Living Wage city, reaffirming the pledge I made when I was re-elected. This new campaign will bring together London’s communities, employers, trade unions and workers, to solve London’s biggest pay challenges. The first campaign steering group is meeting in the new year. I am calling on all organisations to play their part, especially those in the sectors that are pivotal to our recovery from the COVID pandemic, like retail, hospitality, the night-time economy, health and social care.

Photo of Marina Ahmad Marina Ahmad Labour

Thank you, Mr Mayor. I know that many people, including those in my own constituency of Lambeth and Southwark, are delighted with the announcement that you have made. The Government announced a pay increase to the national minimum wage to £9.50, which falls considerably short of what you have announced. This comes on top of the cut to the universal credit uplift, which leaves many Londoners struggling to make ends meet. There was nothing in the recent budget for those who cannot work. That includes carers, those with young children, and people who are sick or disabled, who face the same costs and pressures as other households and will still have a black hole in their finances after the universal credit cut. What support can you provide to these Londoners in the absence of Government action?

Photo of Sadiq Khan Sadiq Khan Mayor of London

Just to remind you that the difference between somebody from next April receiving the Government’s minimum wage, and those receiving the London Living Wage in London is £4,000 a year. That is the difference it makes to an individual. What we are trying to do is, being honest, we cannot fill the massive hole left by Government cuts to welfare benefits, to the increase in National Insurance from next year, to off-benefit caps, to the increased cost of living. What we can do though is, using our limited resources, help Londoners in relation to the heating of their homes. We have a Warmer Homes programme, which is trying to help Londoners reduce their energy bills. We also have an Advice in the Community Settings programme, which is helping people with debt. What we do not want people to be doing is getting into debt through loan sharks and those who charge high interest rates; therefore, we are giving advice on debts.

The third really important piece of work, particularly as the weather gets colder, is the Life Off the Streets programme helping rough sleepers. You will be aware from your constituents, some people can - because of the increased cost of living - lose their homes and become rough sleepers. We are going to get them off the streets as soon as possible. One example of the things we are doing this winter.

Photo of Marina Ahmad Marina Ahmad Labour

Thank you, Mr Mayor, very welcome initiatives. Just following on from this, what impact will the budget have on the cost of living for Londoners?

Photo of Sadiq Khan Sadiq Khan Mayor of London

Unfortunately, the universal credit cut of £20 a week still took place and the announcement from the Chancellor about the tapered relief does not help as many Londoners as need the help. We are really concerned about the increase in inflation. You will have seen the figures this week about inflation going up even further, which means that a real cost of living crisis, with wages not meeting the increased cost of living. The Government has announced - which I welcome - a hardship fund. It is £500 million. Again, it does not fill the hole left by the consequences of some of their policies. We will have to wait and see the detail of how the [Comprehensive] Spending Review (CSR) plays out.  I am concerned about austerity continuing, even though we were led to believe that austerity would come to an end with the election of this Government in November 2019.

Photo of Marina Ahmad Marina Ahmad Labour

Thank you, Mr Mayor. The Chancellor acknowledged every child’s right to succeed. However, as you know, we have high child poverty levels in London and this budget left too much still to do. It was good to see that the Chancellor acknowledged that ten years of austerity has had an adverse impact on children’s start in life. What conversations are you having with the Chancellor to lobby for family hubs that have been announced to be set up in London?

Photo of Sadiq Khan Sadiq Khan Mayor of London

So far, no good news regarding money from the Treasury in relation to family hubs. We are hoping to meet with the new Secretary of State for Education to discuss this issue. We are doing some work - you will be aware - with colleagues across London with the London Recovery Programme. Involved are the anchor institutions, the National Health Service (NHS), and other key colleagues. We are working with other colleagues across London. No support up until now from the Government about the family hub. We have known from the early years work we have done, the early years hubs, the early years campaign, as to how much of a game-changer it can be for families who did not know of some of the facilities on offer. It is particularly relevant this winter as we approach much colder weather, more energy bills, potentially increasing food prices as well. That is why it is really important these poorer families receive the support they need.

Photo of Marina Ahmad Marina Ahmad Labour

Thank you, Mr Mayor. Thank you, Chair.