Living wage ‘would stimulate economy’
THE introduction of a ‘living wage’ for all States employees and those working for government contractors would stimulate the Island’s economy, a backbench politician has claimed.
Deputy Andrew Lewis, who is a member of the Jersey Living Wage Advisory Council, spoke at an event alongside Graham Griffiths, the director of UK campaign group The Living Wage Foundation.
The Deputy said that currently businesses have a perverse incentive to pay their staff less as they know the employee will be able to claim benefits.
He said a living wage, which varies from place to place and is a rate of pay that is deemed high enough for employees to maintain a reasonable standard of living in their community, would also encourage people to take jobs.
The States are due to debate a proposition from Deputy Geoff Southern calling for the States Employment Board to seek accreditation as a living wage employer.
Under the proposal all subcontractors and suppliers working with the States would also be required to pay their staff a living wage.
Following this week’s event, Deputy Lewis said that if the States dids not lead then others would not follow.
‘It is now time for the States to sign up as a member of The Living Wage Foundation,’ he said. ‘However to do so the States also needs to ensure that all its suppliers, including recently out-sourced providers such as cleaning and gardening companies, also pay their staff the living wage.’
He added: ‘Not only does the living wage create a greater incentive for people to take jobs but it stops the ridiculous situation that we currently find ourselves in whereby the government is subsidising the few businesses that do not currently pay a living wage. It does this by topping up workers’ salaries through income support and supplementation.
‘Living wage detractors always point to the potential for jobs to be lost but this is a red herring. By paying people a decent amount for their work, you stimulate the economy by putting more money in consumers’ pockets and crucially, you increase the tax take at the same time.
‘On the other hand, the current situation creates a perverse incentive for employers to pay their staff less, thereby reducing income tax and paying out more through benefits.’
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