Clive Lewis For Norwich South
Until the political will exists for reform of the UK’s economically damaging anti-trade union legislation, a new and enhanced minimum wage floor is urgently needed. Whilst the moral case for a £15 an hour living wage should not be in question, the economic one, for many, has been. And yet the evidence presented in a new Progressive Economy Forum (PEF) report for both, is now overwhelming.
Read the report HERE.
Summary of report findings from the Progressive Economy Forum
As well as protecting working people by ensuring wages rise above inflation, PEF’s modelling shows that a £15/hour minimum wage by 2024 would be:
- The poorest 70% of households would see a 6.9% increase in their forecast incomes.
- A strong “Levelling Up” measure, with 33% of employees in London benefitting, compared to (for example) 51% of employees in the North of England.
- A £15 hour minimum wage would compensate workers for a ‘lost decade’ of zero wage growth since the financial crisis, returning the workers’ share of national income back to the levels of the early 2000s.
- This policy would raise a further £32.7bn in taxation from income and National Insurance Contributions.
- It would save the government £4.2bn on income-contingent benefits payments.
- The overall result is a £25.1bn improvement in the public finances, after taking off the increase in the public sector pay bill that arises from the change.
The report authors propose phasing in the move over the next two years to 2024 in order to give more time for businesses to adjust, and suggest using the additional income from taxation to compensate smaller businesses for their increased costs.