This week the Mayor of London announced a new London Living Wage of £9.40 per hour, up nearly 3 percent on last year. This calculation, made annually by independent experts at City Hall, is the minimum amount people need to earn to make ends meet in the capital.
The fact that the London version is so much higher than the UK Living Wage of £8.25 reflects what we all already know – it costs much more to get by in this city than anywhere else in the country.
The Mayor also announced that the number of employers paying the London Living Wage – who include Transport for London, Barclays, Aviva, Google, ITV and Burberry – has grown from 429 last year to 724. Since 2011, more than 30,000 people across the capital have received a pay rise as a result of their employers joining the Living Wage scheme.
This is thanks in large part to the Green members of the London Assembly, at whose instigation the Living Wage Unit was set up in City Hall. Because of their pressure, all City Hall agencies and companies doing business with the Greater London Authority now pay the London Living Wage.
But even in London, which has led the way in this field, this is a drop in the ocean and the vast majority of employers do not pay the living wage.
That’s why politicians need to do more. The government says it is committed to making work pay, which it claims as the rationale behind its assault on tax credits. If the Tories are serious about that, they should give elected mayors the powers to set their own local minimum wage. This is a measure I have been promoting in Parliament, and I have been urging my rivals for Mayor of London who are also MPs to sign up to it.
But politicians also need to work much harder to make the existing minimum wage reflect the actual cost of living. The Living Wage should be made compulsory for all employers.