Press release: 39,000 Edinburgh workers set to benefit from Scottish Labour living wage pledge

  • Party would introduce Make Work Pay contracts incentivising firms to pay Living Wage
  • 39,000 people in Edinburgh working for less than the living wage
  • Average £445 rebate to businesses meaning over £17 million available to capital firms

B_rPvy2UYAEsLW_Edinburgh East MP Sheila Gilmore has hailed Scottish Labour’s plans to incentivise firms to pay the living wage.

Under Make Work Pay contracts, employers would receive a tax rebate of up to £1,000 for every low paid worker who gets a pay rise. With 39,000 people in Edinburgh estimated to be working for less than the living wage and the average rebate set to be £445, this would see £17 million made available for capital firms who pay the living wage.

If all 400,000 low paid workers across Scotland were given the living wage, business would get a windfall of over £180 million.

Research that shows paying the living wage leads to a 25% fall in absenteeism, while 80% of employers believing the living wage has enhanced the quality of the work of their staff and 66% report a significant impact on recruitment and retention within their organisation.

The SNP have previously voted with the Tories against Scottish Labour plans to extend the living wage to the private sector.

Edinburgh East MP Sheila Gilmore said:

A lot of businesses in Scotland want to give a pay rise to their staff but the conditions aren’t right.

That is why Scottish Labour will introduce make work pay contracts to incentivise them to pay the living wage.

This could give a pay rise to as many as 39,000 workers in Edinburgh alone, with over £17 million in tax rebates available to firms.

Businesses would also benefit in the long term through lower absenteeism and staff turnover, and higher performance and morale.

When Scottish Labour tried to extend the living wage before the SNP Government in Edinburgh voted with the Tories to block our plans. The SNP were wrong to deny thousands of Scots a pay rise. Scottish Labour will not let these Scots down.

In May Scotland can decide the general election. We can deliver a Labour Government that will make work pay; we can deliver a government which delivers a living wage.

ENDS

Notes

  • Make Work Pay contracts will mean that, in return for paying the living wage within the first year of a Labour Government, businesses will receive back 12-months’ worth of the resulting increased tax and National Insurance revenues received by the Government.
  • If the Government introduced this now, firms could receive a 12-month tax rebate of up to £1,000 – and an average of £445 – for every low paid worker who is moved onto a living wage.
  • The estimated number of people working for less than the minimum wage in Edinburgh is 39,000. 39,000 x £445 = £ 17,355,000.
  • For every extra pound employers pay to raise workers from the National Minimum Wage to the living wage, the Treasury saves on average 49p in the form of lower social security payments and higher tax revenues.
  • Labour’s Make Work Pay contracts would mean that employers could claim back the entire increase in tax revenue – an average of 32p in the pound – for the first year.
  • Although the bulk of the money in the first year would be paid back to employers, the Government would still see a net saving through lower social security and tax credit payments, and increased tax revenues in future years.
  • We will also require listed companies to report on whether or not they pay the living wage.
  • List of living wage benefits from the Poverty Alliance available here: http://slw.povertyalliance.org/userfiles/files/SLW%20Benefits%20Nov14(2).pdf
  • The SNP has consistently voted against Scottish Labour’s call for the Living Wage to be included in the procurement process. Most notably in Stage 3 of the
  • Procurement Reform (Scotland) Act, details found here: http://www.scottish.parliament.uk/parliamentarybusiness/28862.aspx?r=9171&i=86467&c=1737184
  • For more information please contact Matt Brennan, Parliamentary Assistant to Sheila Gilmore MP, on 020 7219 7062, 07742 986 513 or matthew.brennan@parliament.uk.
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Press release: Jobs figures show Tories and SNP are letting down Edinburgh

Responding to today’s unemployment figures, Sheila Gilmore said:

Here in Edinburgh, 2200 people have been unemployed for a year or more, with 245 of these being aged under 25. Both the Conservative and SNP Governments are still letting down our city.

Furthermore, thousands of people in work are struggling to make ends meet because inflation is rising faster than pay.

Labour would combat this by restoring the value of the national minimum wage, getting more employers to pay a living wage, extending free childcare provision, freezing gas and electricity bills and getting the next generation into work with apprenticeships and a compulsory jobs guarantee.

ENDS

Notes to editors:

Here are the unemployment figures by constituency:

Constituency                                     Long-term unemployment          Long-term youth unemployment

Edinburgh East                                  550                                                         60

Edinburgh North and Leith                605                                                         60

Edinburgh South                               265                                                         25

Edinburgh South West                     455                                                         55

Edinburgh West                                325                                                         45

Total                                                      2,200                                                     245

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Cost of living crisis must end

On Monday I wrote a column for the Edinburgh Evening News on insecurity at work. I’ve reproduced this in full below.

Families in Edinburgh are facing the biggest cost of living crisis in a generation, and this is being compounded by rising insecurity in the workplace.

Recent figures show that the number of people feeling insecure at work has almost doubled from 6.5 million to 12 million since 2010. There are a number of factors at play here.

For a start there has been a rise in the number of employees on zero-hours contracts, with some figures estimating there could be as many as one million people now employed on them. Just last week I met a constituent who was waiting every week for a text message from her employer, a private homecare firm, to tell her what hours, if any, she would be working that week. This caused her budgeting problems from week to week. Luckily her daughter was now a teenager so short notice calls didn’t cause her childcare issues, but for others they do.

In addition, the number of people working part-time but who want to work full-time has risen by more than 350,000 to more than 1.4 million over the same period. And many of these people are paid the minimum wage which has declined in value by almost five per cent over the last four years. Finally, changes to the law have made it easier to fire workers instead of hiring them.

This is a shocking situation. While both employers and employees need flexibility, this shouldn’t mean people in Edinburgh lacking job security and struggling to afford the weekly shop.

That’s why Labour’s plans to deal with this issue are so important. We would ban zero-hours contracts where they exploit people, end the scandal of false self-employment, strengthen the minimum wage, and incentivise employers to pay a Living Wage through “make work pay” contracts.

Insecurity at work is a huge challenge and this will still be the case after the next election in May 2015, whichever party is in power. But only by taking real action will government have any chance of tackling the issue. And only then will people Edinburgh be able to earn their way out of the cost of living crisis.

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Press release: Sheila Gilmore MP backs Labour’s plans to tackle low pay

Edinburgh East MP and Work and Pensions Select Committee member Sheila Gilmore has backed Labour’s plans to raise wages for thousands of low-paid workers in Edinburgh.

Labour will introduce Make Work Pay contracts that will help businesses raise wages, and help the next Labour Government cut social security bills for the taxpayer.

Firms that commit to paying their employees the living wage, currently £8.80 in London and £7.65 elsewhere, in the first year of the next Parliament will be offered a 12 month tax rebate of up to £1,000 for each individual worker that receives a pay rise.

The money would be funded directly from increased income tax and National Insurance revenues. Additional savings in lower tax credits and benefit payments, as well as increased tax revenues in future years, will cut social security bills and help pay down the deficit.

Sheila Gilmore MP said:

I’ve spoken to hard-working people in Edinburgh who’ve told me that they go to work and do the right thing, yet they are struggling to pay their bills. It can’t be right that we’ve now reached the point where more of the people bringing up families in poverty are in work than out of work.

We need to make sure work always pays which is why I’m backing Labour’s plans to encourage more firms to pay their employees the living wage. This is a positive way of helping hard-working people on low pay and will also help local families cope with the rising cost of living.

Leader of the Labour Party Ed Miliband said:

Low wages aren’t just bad for working people and their families. They are driving up the social security bill too, as the country has to subsidise more low paid jobs with tax credits and benefits.

That is why the next Labour government, in our first year in office, will offer Make Work Pay contracts to employers.

The result: working people will get higher wages, employers will get support to help to make the transition to a living wage and the next Labour government will cut the cost of social security for the long term.

ENDS

Notes to Editors:

  • Sheila Gilmore is a member of the Commons Work and Pensions Select Committee. You can view the committee’s website here: http://www.parliament.uk/business/committees/committees-archive/work-and-pensions-committee/
  • For more information please contact Matt Brennan, Parliamentary Assistant to Sheila Gilmore MP, on 020 7219 7062, 07742 986 513 or matthew.brennan@parliament.uk.
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