Owen Smith will today pledge to deliver pay increases for five million workers as part of plans to ensure the “biggest boost to living standards for a generation” if he becomes prime minister.
Labour leadership hopeful Owen Smith. Credit: PA
The Labour leadership hopeful will outline proposals to bolster workers’ pay and conditions to counter what he labels a “perfect Tory storm” of falling wages, cuts to social security and diminishing rights at work.
He will commit to implementing a “true” living wage of £8.25 an hour as recommended by the Living Wage Foundation, and extend the offer to all workers over the age of 18.
Mr Smith, the former shadow work and pensions secretary, will also pledge to turn the Low Pay Commission into a Living Wage Delivery Unit.
The new structure will be tasked with recommending pay increases and ensuring companies do not compensate for the higher wages by reducing overtime or other perks.
In a speech in Milton Keynes this morning, Mr Smith will say: “For the last six years British workers have experienced a perfect Tory storm of falling wages, the watering down of workers’ rights and cruel cuts to social security. Resulting in the sharpest fall in living standards ever recorded for low paid British workers.
“In the face of this onslaught, what’s desperately needed is not more slogans, but a clear plan of action which offers solutions.
“So as the next Labour prime minister, I would introduce radical plans to deliver the biggest increase in living standards in a generation.
“I am committed to delivering a real living wage for everyone over the age of eighteen – ending the discrimination of those under 25. Increasing support for low-paid workers through our social security system – cruelly slashed by the Tories – and delivering a revolution in workers’ rights to give people a strong voice at work.”
Elsewhere in his speech, Mr Smith will pledge to establish a High Pay Commission to force mandatory reporting of company pay ratios.
The commission will consult on whether to introduce maximum pay ratios between top earners and average earners for private sector firms who provide public services.
Jeremy Corbyn has also advocated installing a “real” living wage and announced that companies with more than 21 employees to publish earnings data in a bid to close the gender pay gap.
In January, the Labour leader floated the idea of banning companies from paying dividends until their staff are paid the living wage.
The Government’s National Living Wage came into force in April this year set at £7.20 an hour. It will rise to £9 an hour by 2020.
On launching a new Economy and Industrial Strategy committee yesterday, Prime Minister Theresa May said increasing wages for the lowest paid would be among her top priorities.