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Business groups warn Welsh government on 'living wage' Business groups warn Welsh government on 'living wage'
(about 2 hours later)
Business leaders have warned the Welsh government not to push for private sector pay rises as ministers investigate public sector wage levels.Business leaders have warned the Welsh government not to push for private sector pay rises as ministers investigate public sector wage levels.
Labour has a manifesto commitment to find ways of making sure all Welsh workers are paid a "living wage".Labour has a manifesto commitment to find ways of making sure all Welsh workers are paid a "living wage".
Supporters say that is enough for basic living costs and to raise a family, or £7.20 an hour by some estimates. Business groups say it may stop firms taking on staff or even mean layoffs.
But business groups say it could stop them taking on more staff or even result in layoffs. The Welsh government says it is beginning to examine how devolved public sector employers can be encouraged to pay a living wage.
Academics at Loughborough University have estimated a living wage is at least £7.20 an hour. A policy group of interested parties is expected to meet over the summer.
The current statutory minimum wage is £6.08 an hour for workers aged 21 and over. Academics at Loughborough University have estimated a living wage is at least £7.20 an hour. The current statutory minimum wage is £6.08 an hour for workers aged 21 and over.
Ministers are looking at how to encourage devolved public sector employers to pay a living wage. A policy group of interested parties is expected to meet over the summer.
Welsh NHS workers and Welsh government civil servants are already paid at least the living wage.Welsh NHS workers and Welsh government civil servants are already paid at least the living wage.
A number of big private sector employers, including Barclays Bank and accountants KPMG, are also signed up to paying it.A number of big private sector employers, including Barclays Bank and accountants KPMG, are also signed up to paying it.
But business organisations warned Welsh ministers not to try to force them to raise wages, for example by inserting living wage clauses in government contracts.But business organisations warned Welsh ministers not to try to force them to raise wages, for example by inserting living wage clauses in government contracts.
'Problems'
Robert Lloyd Griffiths of the Institute of Directors said he was concerned the living wage would effectively become the new minimum wage.Robert Lloyd Griffiths of the Institute of Directors said he was concerned the living wage would effectively become the new minimum wage.
"Businesses would like to take on more staff and lots of companies that I talk to would love to be in a position to be able to take on more employees," he said."Businesses would like to take on more staff and lots of companies that I talk to would love to be in a position to be able to take on more employees," he said.
'Very difficult'
"It's very difficult out there and anything that now will hinder them from doing that, which they'd like to do, is going to cause problems."It's very difficult out there and anything that now will hinder them from doing that, which they'd like to do, is going to cause problems.
"I'm afraid it just isn't realistic in the environment we live in.""I'm afraid it just isn't realistic in the environment we live in."
Anna Milewski, of the Federation of Small Businesses, said: "We have to look at it from the employers' perspective, we've surveyed them.Anna Milewski, of the Federation of Small Businesses, said: "We have to look at it from the employers' perspective, we've surveyed them.
"They say that an increase can, at best, deter them from taking on staff at worst actually result in them laying off staff, which would not be a positive outcome, of course.""They say that an increase can, at best, deter them from taking on staff at worst actually result in them laying off staff, which would not be a positive outcome, of course."
Labour AM Julie Morgan said: "If we're the trailblazers we hope the private sector won't be so frightened of it and will actually see the benefit of a workforce which when they're happy and healthy work harder, stay longer, are more and actually do better work. The Welsh government said: "Unlike the minimum wage, the living wage is not statutory.
"So it's a win win, really." "However, any employer in the UK is free to sign up to the Living Wage Foundation's campaign. The Welsh government is starting to look at how devolved public sector organisations have been engaging with the idea and what it would take to encourage those organisations to become living wage employers.
"This is a key reason the Minister for Local Government and Communities [Carl Sargeant] has decided to set up a policy group, so that consideration of the benefits, in much the same way as they were in London, can be given collaboratively. That group has yet to be brought together, but it is anticipated that this will happen over the summer."
Labour AM Julie Morgan said: "If we're the trailblazers we hope the private sector won't be so frightened of it and will actually see the benefit of a workforce which when they're happy and healthy work harder, stay longer, are more and actually do better work. So it's a win win, really."
Young campaigners, working with Save the Children, recently petitioned the assembly for a living wage above the minimum wage.Young campaigners, working with Save the Children, recently petitioned the assembly for a living wage above the minimum wage.
Iram Shahzad, a 13-year-old pupil at Fitzalan High School in Cardiff, told BBC Wales Sunday Politics that people in her community were working long hours but not earning enough money to cover their everyday essentials.Iram Shahzad, a 13-year-old pupil at Fitzalan High School in Cardiff, told BBC Wales Sunday Politics that people in her community were working long hours but not earning enough money to cover their everyday essentials.
"It's not fair that they don't get to live a happy life," she said."It's not fair that they don't get to live a happy life," she said.
James Pritchard, head of Save the Children in Wales, said a living wage would be a "direct way of starting to tackle child poverty".James Pritchard, head of Save the Children in Wales, said a living wage would be a "direct way of starting to tackle child poverty".
He said: "We know that if we start to pursue living wage policies across the board in Wales, across the public sector and the private sector, then we are putting money into the pockets of the parents of children who are struggling with the current economic situation."
Sunday Politics is on BBC One Wales at 12:00 BST on 17 June.Sunday Politics is on BBC One Wales at 12:00 BST on 17 June.