The weekend before last the Observer’s front page reported that Labour party leader Ed Miliband has joined forces with his brother David to work up plans to deliver a ‘living wage’ of more than £7.20 an hour, and more than £8.30 in London, for millions of workers in both the public and private sectors. ‘The Miliband brothers, whose relationship has been tense since Ed narrowly defeated David in the 2010 leadership contest, are working closely together on how to make the living wage – as opposed to the lower minimum wage – the new norm and a core economic policy for Labour at the next election.’ And, in a joint article inside the paper, David Miliband and Dave Prentis, general secretary of the public service union Unison, concluded: ‘The minimum wage has been a great success, lifting more than a million out of poverty without job losses. The living wage campaign builds on that success in an attempt to stamp out in-work poverty.’
The following day, London mayor Boris Johnson announced a new London living wage rate of £8.55, and called on his Conservative colleague David Cameron to follow his lead by paying the this rate to all workers in Whitehall. The mayor also promoted a Living Wage Foundation accreditation trademark for employers who pay the London living wage.
Yep, that’s right: last week was Living Wage Week – in case you missed it. And maybe, just maybe, Ed Miliband is right when he says that the living wage is an idea ‘whose time has come’. Which would be great, not least because, according to the well-respected Institute of Fiscal Studies, the government would benefit by about £1,000 a year (in increased tax revenue and lower spending on tax credits) for each low paid worker moved onto the living wage.
Which makes it somewhat ironic that, last week, the Department for Environment, Food and Rural Affairs (Defra) closed a remarkably short and inadequate consultation on its plan to abolish the agricultural minimum wage (AMW) in England and Wales – a move that would most likely result in significant pay cuts for many of the more than 150,000 agricultural workers covered by the AMW scheme. As the TUC notes in its sharply critical response to the consultation, ‘it is absolutely certain that abolishing [the AMW] would lead to average wages falling in the agriculture sector”, leading to “an increase in rural poverty’. Under the AMW, skilled and experienced agricultural workers are guaranteed up to £9.40 per hour, well above the national minimum wage rate of £6.19 per hour.
The proposed abolition of the AMW and the associated Agricultural Wages Boards (AWBs) for each of England & Wales, Scotland and Northern Ireland was first announced in July 2010 as part of the then newly-elected Coalition Government’s ‘quango cull’. However, since that time the devolved governments in Scotland and Northern Ireland have both decide to retain their AWBs, and the Welsh Assembly has tried to block the abolition of the AWB for England & Wales.
Citizens Advice is in principle opposed to any significant diminution of existing statutory employment rights and minimum standards, and especially those rights and standards that serve to protect the most vulnerable and low paid of workers. As the union Unite notes in its detailed and comprehensive response to the Defra consultation, ‘within agriculture and horticulture there is a deeply troubling record of exploitation, and the abolition of the AWB will push many employees further into precarity. Despite intensive work by unions and others, the “dash to the bottom” has been the result of the squeeze by the retailers and government indifference, with producers hiding behind voluntary codes. The AWB is the last line of defence against intensifying precarity.’
In the Citizens Advice response to the Defra consultation, therefore, we strongly endorse and support the responses submitted by Unite and the TUC, which to our mind set out a highly compelling case that abolition of the AWB and the AMW scheme would most likely have very serious negative consequences not just for many workers in the sector, but for rural economies and communities more generally.
And we’ll just have to see whether either of the Miliband brothers – or indeed any senior Labour MP – has anything to say about the matter.
Author: Richard Dunstan
Richard Dunstan is a policy wonk who has worked for Citizens Advice, the National Audit Office, the Law Society, and Amnesty International UK.