Chuka Umunna MP, Labour’s Shadow Business Secretary, commenting on the Low Pay Commission’s recommendations published today, said:

“The Chancellor and Prime Minister have misled working families. For all their claims about a higher minimum wage the Low Pay Commission has today recommended a rise of 20p and at this rate the minimum wage will fall far short of the £8 an hour Labour has committed to, reaching just £7.50 by the end of the next Parliament. That will mean working people are almost £800 a year worse off under the Tories than under Labour.

“George Osborne said a year ago that he wanted a £7 minimum wage in 2015, but this was completely absent government’s own submission to the Low Pay Commission, and today’s recommendation falls well short of his promise.

“Only Labour has set a more ambitious target which would deliver an £8 minimum wage before 2020. The Tories have failed to match our plans to boost the minimum wage and restore the link between earnings and hard work.”

ENDS

Notes to editors:

1. The Low Pay Commission has today recommended that the minimum wage increase to £6.70 from October 2015

2. When the Government published its evidence to the Commission last year, the Treasury produced additional analysis showing the impact of an increase in the NMW to £7 by 2015-16.

3. “As part of the fiscal assessment, the Government has considered an illustrative scenario of the increase that would be required to restore the 2007-08 real value, using CPI, of the adult NMW rate by NMW year 2015-16. This corresponds to an increase in the adult minimum wage to around £7”.
Final Government Evidence for the Low Pay Commission on the Additional Assessment, January 2014, p.17, https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/273345/bis-14-534-national-minimum-wage-government-evidence-for-the-low-pay-commission-on-the-additional-assessment-2014.pdf

4. At the time George Osborne said that had the NMW kept pace with inflation it would be £7 by 2015/16, and suggested that he would be supportive of such a move.

“Well look the exact figure has to be set by the Low Pay Commission which talks to business, talks to other bodies in our economy, but if, for example, the minimum wage had kept pace with inflation it would be £7 by 2015/16, £6.31 at the moment, so that is an increase. I think we can see an above inflation increase in the minimum wage and do it in a way that actually supports our economy precisely because the economy is recovering and many, many jobs are being created.”
George Osborne, BBC, 16 January 2014

“Well of course we have got to make the exact calculation of what the rate should be, that is for the Low Pay Commission, created by the Labour government, supported by this government to make the independent decision on the number itself. But when I look at the British economy, I see the British economy expanding, I see jobs being created, I see the prospect of future jobs being created as well and I think Britain can afford a higher minimum wage, I think we have worked hard to get to this point and we can start to enjoy the fruits of all that hard work.”
George Osborne, BBC, 16 January 2014