Yes, We got it wrong on low wages – Ed

Although you can overdo the ‘mea culpa’ style in politics, it is refreshing to get a politician who can admit it when he or his party get’s it wrong. It is one of Ed Miliband’s attractive features.


Now he has done it again, accepting blame for the last Labour administration’s failure to properly address falling wages. In what must be his first concrete policy announcement ahead of the next general election. At a Scottish Labour gathering in Edinburgh recently, he promised to make it a priority for the next Labour government to introduce a national living wage. (The Guardian, 24th August 2013). Wow, that is shouting louder!


No doubt he also had an eye on union audiences for the upcoming TUC and Labour Conferences where he could be in ‘hot water’ over his proposals to change the political levy system. However he or Lord Ray Collins (an old colleague from our young T&GWU days), dress it up, it seems they mean to change to an ‘opt in’ on an individual system of union contriutions, as opposed to our favoured collective basis.


Whatever is behind this new Living Wage’ proposal, good thinking. The Labour Party could be onto a winner with this upgrade of their last administration’s hugely popular Minimum Wage legislation. Of course, the bad employers’ lobby and most of the right wing media will cry ‘millions of jobs would be lost’, but public opinion is on his side here, I suspect. Ed is rightly focusing on the big squeeze on family finances under this uncaring coalition government. In Brent where I’m a councillor, we’ve adopted a Q Living Wage policy and people really think its the right way to go.


In a recent blog, I also highlighted HSBC Director of Research, Stephen King’s new book warning ‘of the dangers of such a lengthy wage freeze as workers in the western economies have recently endured. He described it as ‘the greatest redistribution of income to the asset and cash rich since the nineteenth century.’


The real issue is how a real living wage could be brought about in all the private sector workplaces, even if all the political parties signed up? Already with the much lower statutory minimum wage, new rules are having to be brought to ‘name and shame’ those numerous ‘bucket-shop’ employers who flout the law, but don’t get taken to court. There will also be practical issues of implementation, as we have on the Council, in some pockets of extreme low pay eg cleaning contracts. But these can be addressed over time with suitable mechanisms, proper consultation and representation of the workers concerned.


If Labour wills this end, they must also ‘will the means’ – an institutional framework which can be enforced by workplace organisations viz., trade unions. Unions must respond to this laudable initiative by coming up with workable proposals of their own to assist Labour in fleshing out such a framework. They should start working on the sectors where they recruit in harmony, rather than in rivalry for members. Don’t let’s leave it to the policy wonks or HR experts who surround the Labour Leader, who are sure to come up with a flawed mechanism, the weaknesses of which rogue employers and their ‘clever’ lawyers will already be working on.


Wage regulation is not rocket science, as it has been done before on a national scale, especially in the 1930s – last time the State was really concerned that ‘squeezed’ and poverty wages were a matter of serious social concern. Wages Councils, national agreements backed up by legislation and arbitration systems are well tried methods in Britain.. The initiatives taken then led to a major growth in trade union membership, union recognition and collective bargaining.


Here’s a real issue for unions and Labour to ‘get their teeth into’, rather than having barren wrangles about how the dwindling members’ pence of the political levy should be collected. By all means try new ways of engaging the millions of union members in politics, to ensure that the union voice is properly heard and representative of their views. But the real test of modern Labour’s payback for union funding, is whether they deliver on this new Living Wage commitment.


Unions21′s event: Fair Pay: The Fair Work Commission Debate – is at TUC Congress Monday 9th September. Read more here:


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