THE government has thrown out a report undertaken by ministers under the previous administration which found that aligning the minimum wage and living wage was neither “feasible or desirable”.
Social Security Minister Lyndsay Feltham delivered the message during States question time yesterday when asked by Deputy Hilary Jeune how plans were progressing to determine a new living-wage rate – defined as a wage that is high enough to maintain a normal standard of living.
Elsewhere in the sitting, Chief Minister Lyndon Farnham admitted that moving from the minimum wage to a living-wage rate could result in job losses for some businesses.
Deputy Feltham said that transitioning the minimum wage to two-thirds of the median wage – a similar indicator of the living wage – before the end of the government’s term was one of her priorities and was also a focus of the Common Strategic Policy.
She said the current plan was to introduce an “intermediate rate” in 2025, with the full two-thirds rate to be achieved in January 2026.
She added that she was working closely with Economic Development Minister Kirsten Morel on determining the intermediate rate and would shortly be asking other politicians to allow her to set the rate without entering into consultation with the Employment Forum.
Deputy Feltham said: “I have met with the chair of the Employment Forum and I am comforted that this [decision not to have a consultation] will not be detrimental to setting an appropriate rate.
“That 2025 rate will be introduced in the coming weeks, and during 2025 I will be working with ministers to develop a set of minimum income standards for Jersey households, valuable local information which will be used to inform [the] future living-wage rate.”
When asked by Deputy Kristina Moore whether she would be supporting businesses to make the transition, Deputy Feltham said that “support packages” could be available to employers, and that she remained in consultation with them.
Deputy Jeune pressed the minister on whether this meant she was “discarding” findings of the previous government report.
Deputy Feltham said: “The report suggested that it was not feasible or desirable to move to living wage. That is not a comment I agree with, and ministers did not have basic information such as how many people were affected, and that evidence was somewhat lacking.
“I am disregarding that report. I will not be redoing the work that had been done.”
The previous government report, commissioned by Social Security Minister Elaine Millar, concluded that “a statutory link to a specific formula or target could be counter-productive”.
It argued that it would be “difficult to justify” the statutory rate, “which could not be adjusted when circumstances require it”.
Deputy Farnham meanwhile said: “I think it is likely that we see job losses. I hope we don’t see businesses close.
“When I say job losses, I think we might see job losses in some businesses as they restructure themselves to make sure they remain viable as a business.”
Although he suggested that businesses might need States help to tide them over, he said he would be opposed to giving subsidies and that he would look at “different types of support”.
