Living Wage back on the budget agenda in Leeds – but don’t hold your breath

The Living Wage Foundation logo

Not yet, we aren’t

Another budget, another unmissable opportunity for the opposition in Leeds City Council to use the “living wage” as a stick with which to beat the ruling Labour Party.

Last year it was the opposition Conservative Party who tabled an amendment, lecturing Labour leaders that it was about time the “living wage” was introduced at the council.

This year it’s the Lib-Dems who have tabled an amendment to the 2014-15 budget (that gets debated and passed tomorrow) calling for an end to “the scandal that means over 1,500 council staff receive less than the ‘living wage’ of £7.65 an hour”.

Like the Tory one last year, this year’s proposal will be voted down by the Labour majority.

“Hang on,” I hear you ask, “isn’t the Living Wage a key LABOUR Party policy? Isn’t it what Ed Miliband and his crew are always banging on about? How come it’s the Con-Dems who have been pushing it in Leeds and not Labour?”

Well, it appears that pronouncing about the Living Wage as a matter of policy principle or from the moral high ground of opposition is one thing, making it happen and sustaining it at one of the country’s biggest councils in the current economic climate is another.

Ask the Labour-run council in neighbouring Bradford. They carried out a pretty exhaustive enquiry into the issue last year and came up with as many questions as answers (check out the Key Findings of their report).

Two-tier wage policy?

What’s the problem?

First you’ve got to find the money: £2.3m would be needed, say the Leeds Lib-Dems, to bring those 1,500 staff up to £7.65 hourly wage rates. (They’d take it out of the council’s reserves)

Then you’ve got to be certain that as a council you’re going to be able to cope with the permanent uncertainty that would come with having a two-tier wage policy, with one tier – the Living Wage – set annually by an outside body over which you have no control.

That’s before you get to factoring in the likely knock-ons for those working for schools (not covered by the Lib-Dem calculations), and, in the long term, for the thousands of workers employed by firms that the council contracts work out to. Equal pay? Tricky. 

And then there are the pay-scale issues. Bring the 1,500 lowest-paid workers up to the Living Wage and you’ll almost inevitably end up with some staff suddenly earning the same as their supervisors. Career paths and pay differentials thrown into confusion at a stroke.

Still negotiating

Cllr Wakefield: "committed" to introduction of Living Wage

Cllr Wakefield: “very much committed” to introduction of Living Wage

None of this is necessarily insurmountable – they implemented it in Birmingham in 2012 – but none of it is easy either.

Which is why, presumably, it’s a long time coming in Leeds.

There’s obvious scope, for example, for narrowing the difference between the highest and lowest paid in the council – in Leeds the chief executive currently earns 14 times as much as his lowest paid colleague, up from 13 times last year – but you might have a struggle getting most better-off staff and their unions to buy in to such solidarity.

So what’s the situation now with the Living Wage and Leeds City Council?

Well, after last year’s conservative proposal to introduce it was voted down, there were indications that Labour was looking to include it in the 2014-15 budget. Here’s a tweet from a Labour councillor at the time (27 Feb 2013):

LWwalshaw

There was a pledge too from Labour council leader Keith Wakefield, who told the budget meeting last year that “by working with trade unions to make more savings, this Council will become a fair wage Council next year.”

Fair wage? Living wage? Whichever, it hasn’t happened, and isn’t happening in tomorrow’s budget. Talks with the unions were still going on last month.

“We are very much committed to making Leeds a Living Wage economy and are still negotiating with the trade unions to determine how we can deliver the savings we need to be able to finance the scheme for council employees,” Cllr Wakefield told the Leeds Citizen in January.

In the meantime provision has been made in the 2014-15 budget for a 1% pay award across the board (subject to national pay negotiations). That will mean an extra £126 a year if you’re on the lowest salary of  £12,600, £1,500 a year if you’re on £150,000.

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3 Responses to Living Wage back on the budget agenda in Leeds – but don’t hold your breath

  1. Mike Chitty says:

    For just a few tens of thousands, the council could employ a full time benefits adviser who could work with low paid staff to ensure that a) they collect all the benefits are available to them and b) they take all the work on offer that they can, without compromising benefits.

    From work done by the Disrupting Poverty Team we know that very few of those on low wages in the council are collecting their full benefit entitlement and that many are turning down extra work on the basis of unfounded fears that they may lose benefits. This situation may be repeated across a number of low wage organisations in the city in both the public and private sector.

    While I am not an advocate of in work benefits being used to subsidise employers, I am in favour of all parties playing by the rules as fully and effectively as they can. I suspect that increasing access to in-work benefits advice may a larger and much lower cost difference to the income of in work poor.

  2. Techno says:

    My employer has announced that the money for the auto-enrolment pension scheme will have to come out of the “pay pot”, so pay rises will be lower and there will be fewer of them. How do the politicians manage to resolve their enthusiasm for pension auto-enrolment with their desire for a “living wage” when the two are in conflict at my employer, and probably plenty of others? (Not something they have to worry about personally as they get nice, taxpayer funded pensions.)

  3. Bywater blog says:

    It would be nice to get paid the “living wage”, but as council staff are stigmatized by this Tory government, adding to that would not be good. A good idea came from the Liberal Democrats in Calderdale, make all council workers go 3 days before they get any sick pay; and 100% attendance gets them an extra days holiday.

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