Benefit payments and the Living Wage

UK ministers and their allies are fond of talking about the need to reduce the welfare bill. They give the impression that the welfare bill goes to feckless scroungers, but almost never mention any statistics about who is actually claiming the money.

In reality, less than two percent of the welfare bill goes to non-disabled unemployed people. The biggest chunk goes to older people in the form of pensions, but a sizeable amount goes to people in work. Much of this is paid in tax credits and housing benefits.

Tax credits go to people who are in work but who are not paid enough, while housing benefit is high because there is no cap on private sector rents (so in this case, the real benefit recipients are landlords).

This week is Living Wage Week, when faith groups, unions and individuals across the UK are pushing for all employers to pay a Living Wage. Payment of a Living Wage would reduce the welfare bill and, more importantly, tackle poverty.

Currently the vast majority of the UK’s largest companies do not guarantee a Living Wage to their staff. The organisation Share Action is urging people who own private pensions to email their pension fund about the living wage.

If you have a pension, you can urge the fund to add to the pressure for a Living Wage within the companies in which it invests. Share Action have produced an online form to make the process quick and easy.

This tactic is already working. When Share Action launched their “Just Pay!” campaign for living wages two years ago, just three of the biggest 100 hundred companies in the UK paid the Living Wage. Due to the campaign, ten more of these massive corporations have now responded to public pressure by signing up.

Although I don’t have a pension myself, I wish the best of luck with this tactic to those of you who do. If you want to find out more about the Living Wage, and what you can do to promote it, you can visit the Living Wage site and Share Action.

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