Progress | Centre-left Labour politics

Our ambitions must not stop at a pay increase

At the close of Living Wage Week, it is important we look forward towards how we continue to grow the campaign for a fair day’s pay for a fair day’s work.

But first, I want to look back. We know how to use the procurement power of the state to secure better living standards for the many, because we have already successfully done it. Labour has shown that where we are in control of local authorities across the country, we can introduce the living wage for our staff and contractors. So far, 21 councils have helped workers in their employ to live a life with more decency, giving them a little more income so they can afford to buy their child’s birthday present or go out for a pizza with their partner. Despite David Cameron and Nick Clegg rightly committing to the principle of a living wage, their colleagues in local government have failed to follow suit. Indeed, this week Lib Dem-run Sutton council explicitly ruled out introducing the measure.

In the more distant past, TELCO, the East London Communities Organisation met with the Olympic Bid team and made a passionate but reasoned case for supporting the world’s first ever Living Wage Olympics. In 2004 we signed an agreement with London Citizens pledging to honour a commitment to paying the living wage to staff and to establish a National Construction College to give local people the opportunity to build the skills needed to work on the Olympic Park and future construction projects.

By 2011 this meant that over 81 per cent of the workforce on the Olympic Park said they were earning the living wage or above at the point of their enrolment. Moreover, 1,951 host-borough residents were employed by LOCOG as part of its Games-time workforce (55 per cent of whom were previously unemployed) and 21,000 host-borough residents were part of the Games-time contractor workforce in roles such as catering, retail and security. Of the 10,000 permanent jobs created to operate Westfield Stratford City, around 3,000 went to unemployed Newham residents.

We also reached a historic agreement with the TUC called the Principles of Cooperation, which covered training, equality, health and safety, and fair employment protocols. The Community and Trade Union Learning Centre registered more than 550 learners, including workers from the Olympic Park site, local employers and members of the local community, to improve their English and maths skills, master basic IT or take advice on their job applications.

The living wage was part of a package of workplace measures to ensure workers were supported in their role and gained the experience and skills they needed once the Olympics was finished. Moving forward, this is how we must see the campaign for fairer treatment at work. Clearly, there is still a long way to go before the living wage is accepted as the economically, as well as morally, correct choice for the workforce, but our ambitions must not stop at a pay increase.

That is why it is important that we continue to introduce the living wage in concert with employees and employers, because it is the process of persuasion that is the crucial part of the campaign. Once you can sit down and explain the benefits of the living wage, you create an opportunity and precedent to have a conversation about other workplace issues, whether that is flexible working or the staff canteen. If a movement of staff can convince an employer to back a change to working conditions, it can be incredibly empowering for them at the same time as being rewarding for employers to see the increased loyalty of staff.

That is why Labour’s solution to the living standards crisis is to give firms that pay their staff the living wage an incentive of a tax rebate of up to £1,000 for each worker. This both recognises that for every extra £1 that employers pay to raise earnings to the living wage, the Treasury saves 49p in lower social security payments and higher tax revenues. It also provides the space for organisations like Citizens UK to help mobilise staff and civil society to advocate collectively for change, thereby creating the know-how which can be used when needed in the future.


Tessa Jowell MP is a former minister for the Cabinet Office and minister for the Olympics


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Tessa Jowell

is former member of parliament for Dulwich and West Norwood and former secretary of state for culture, media and sport

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