‘Scandal’ of 29,000 paid below poverty threshold

MPs Yvonne Fovargue and Lisa Nandy
MPs Yvonne Fovargue and Lisa Nandy

THOUSANDS of Wigan workers earning less than the living wage is a “scandal,” the town’s MPs said today.

Around 29,000 employees in the borough – 30 per cent of the overall workforce – are estimated to below the threshold, a government report has said.

In the last five years we’ve seen the biggest fall in living standards since Victorian times

Lisa Nandy MP

The shock figures highlight Wigan as one of the worst-hit areas in Greater Manchester, prompting outrage from Labour’s Yvonne Fovargue and Lisa Nandy.

Ms Fovargue, MP for Makerfield, told the Evening Post: “It is a scandal that nearly one in three people who do the right thing, work hard and contribute, don’t earn enough to live on.

“The truth is that the rising numbers of low paid workers has put huge pressure on thousands of local families, forcing them to make impossible choices: heating or eating, paying the rent or paying the bills. It should be the deal that if you work hard you get a fair day’s pay.

“George Osborne’s answer to these appalling figures is to make life even tougher by withdrawing tax credits from the lowest paid families.”

Ms Nandy, MP for Wigan and shadow energy secretary said: “It’s scandalous that so many people in Wigan aren’t paid a fair wage. It puts huge pressure on families and stops people spending in Wigan which holds back our local economy.

“In the last five years we’ve seen the biggest fall in living standards since Victorian times. Now the government says it will bring in a so-called living wage that isn’t enough to live on.

“While the government is playing political games, more and more children in Wigan are growing up in poverty even though their parents work. It’s time for real action to make sure big employers pay a fair wage, and small employers get help from the government to do so.”

The figures are based on what independent experts believe to be the amount “to cover the basic cost of living” which is set at £7.85, a Living Wage rate employers can voluntarily sign up to and is promoted by the Living Wage Foundation.

And the report uses results of the national Annual Survey of Hours and Earnings for 2014 to make its estimations.

Earlier this year chancellor George Osborne introduced plans for a national living wage for over-25s that will be set initially at £7.20 for those outside London but will rise to £9 an hour by 2020.

It has been criticised for being calculated on median earnings rather than the cost of living.

Only Rochdale (32.6 per cent) and Oldham (33.7) were ranked above Wigan across GM.

Sonia Halliwell, assistant director for HR at Wigan Council, said: “As a forward thinking council and employer, Wigan Council introduced a Living Wage for its staff in 2013 and since then this has also been extended to the majority of the borough’s schools. The council has also led the way by eradicating zero hour contracts ensuring that staff have regular hours alongside good terms and conditions.

“We recognise that this may not be the position for all employees across the borough and that is why we are committed to working alongside other employers to ensure they understand the importance of providing a Living Wage and a good standard of terms and conditions.

“The statistics do highlight that there are differences across Greater Manchester and we want to see our local economy grow ensuring that all who live here are able to take maximum advantage of the employment opportunities both within the borough and the wider region.”

Ms Fovargue added: “We need to look seriously at incentives in the tax system for business to pay the real Living Wage. It’s a good deal for workers, who get a pay rise. It’s a good deal for businesses, who will be able to use the incentive to invest in the equipment or training they need to shift to a more productive, higher-wage business model. And it’s a good deal for taxpayers because of the lower social security spending, higher tax revenues and stronger local economy that results.”