PRESS RELEASE 26 September 2000
Embargo: Tues 26 September 2000

Labour Party Fringe Meeting - The Future of the Minimum Wage

The Low Pay Unit today urged the government to put the national minimum wage at the centre of its crusade against in-work poverty and inequality. With a boyant economy, it is time to give the lowest paid their fair share - a rate of £4.94 an hour (half male median earnings) - with future rises linked to increases in average pay.

on 1st October 2000 the minimum wage rises by 10 pence to £3.70 an hour. This is the first increase for eighteen months. Though welcomed, it still represents a fall in pay in real terms for minimum wage workers. It is not a living wage.

At its introduction, the minimum wage achieved much, raising the pay of over one and a half million workers 80 per cent of them women - leading to the largest narrowing of the pay gap between men and women for a decade. A higher level could achieve so much more.

A minimum wage of £4.94 an hour would:
1. Benefit over 5 million workers, two-thirds of whom would be women;
2. Close the gender pay gap by a further one percentage point;
3. Make substantial savings in the WFTC bill, which could be used to increase child benefit.

Bharti Patel, Director of the Low Pay Unit, said:
"Earnings for low paid workers continue to be too low to lift them out of poverty. Targetted benefits like the WFTC may be a short term way of reducing the problem, but in the long run work must pay on its own terms".

For further information, contact Bharti Patel on 020 7713 7616