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'Higher minimum wage', but only for the capital

The minimum wage needs to be raised so that pay for the lowest earners keeps pace with the average worker, according to a new report from the Institute for Public Policy Research (ippr). However, this reccomendation only applies to workers in London. The report shows that the gap between the lowest paid workers and average wages in the capital is wider than anywhere else in the country. The smallest gap is in the North East.

ippr says that an effective minimum wage for London could be set at around £6.50 an hour, compared to the current £5.35 an hour, benefiting around 300,000 workers. ippr argues that the Government should recognise the exceptional circumstances in London with a specific minimum wage rate for the capital but should reject a full scale regionalisation of the National Minimum Wage. The research shows that a minimum wage worker in London earns just a third of the average wage of the capital, but the average UK worker on minimum wage earns more than half the national average pay.

Kate Stanley, ippr Head of Social Policy, said: “In the last ten years the minimum wage has played a significant role in making Britain fairer with no evidence of any negative effect on jobs. But in London the minimum wage has struggled to keep up with average pay rises and is worth a lot less than in other parts of the country. “If the Government is serious about tackling the gap between rich and poor but reluctant to tax higher earners, a higher minimum wage in London – where average wages and living costs are significantly higher than across the rest of the country - must be part of the solution.”

This was posted in Bdaily's Members' News section by Ruth Mitchell .