‘Living wage’ move may boost economy

BUDGET BOSS ... Coun Ed Malcolm.
BUDGET BOSS ... Coun Ed Malcolm.

SOUTH Tyneside Council established the Independent Wage Commission in June last year to examine the benefits and challenges of adopting a living wage in the borough.

The commission’s findings were revealed to council officers, elected members and trades union representatives by the commission’s chairman and professor of politics at Northumbria University, Keith Shaw, at a presentation at South Shields Town Hall.

The living wage is based on the amount an individual needs to earn to cover the basic costs of living.

Because living costs vary in different parts of the country, there is a different rate for London and the rest of the UK.

It is promoted by the Living Wage Foundation.

The commission found that a living wage would make a positive contribution to reducing poverty and promoting well-being among low-paid workers.

Evidence suggests that it would also help to boost the local economy with less well-off workers more likely to spend their money in local shops and on local services.

Its members also concluded that a living wage would help to improve the motivation, attendance and the productivity of employees.

However, the commission also identified that affordability would be a real challenge in the present economic climate, given that South Tyneside is one of the authorities to be hardest hit by Government funding reductions.

The report’s findings will be considered by the council.

Latest figures show that nearly a quarter of all South Tyneside workers – not just council employees – are paid below the living wage.