As FairPensions, who I work for, travel up and down the country this summer on the AGM trail we are coming face to face with some of Britain’s best paid individuals. The CEOs who we stand up in front of have seen their pay quadruple in the last decade while share prices have fallen. Only 19% of people think that banks are well run institutions, a figure which has dropped dramatically since 90% of people thought this to be true in 1983. At a time when financial service providers are clambering for good news you would be forgiven for thinking that these institutions would be knocking at FairPensions door asking to sign up to paying their workers Living Wages. The average CEO of a FTSE 100 company, earning more than five times per week than those on minimum wages earn in a year, would, one would think, be more than happy to investigate ways to pay their workers better wages.
Some companies, such as Standard Life, have responded to the campaign with enthusiasm but the unfortunate fact is that many CEOs, who have very little notion of what life on £5.93 an hour is like, are not taking working poverty seriously as an issue that affects their staff. With trade union memberships falling every year, and increasing amounts of people being forced to accept pay packets which do not rise in line with the cost of living, the timeliness of a national Living Wage campaign could not be more distinct.
In Britain many people who survive on low wages have their incomes ‘boosted’ through government tax credits. These tax credits are, in principal, a good idea. People should generally be encouraged to work but should not be forced to work for wages which offer them no financial advantages over unemployment. The problem with tax credits however is that they act as a subsidy, extracted from the pockets of the British taxpayer, which enable businesses to continue to pay their workers poverty wages. Tax credits must remain to protect those on the lowest wages but the time has surely come for corporations, who continue to make millions and even billions of pounds in profits, to pay their workers high enough wages so that they don’t rely on what are effectively government subsidies.
With over 3.5 million people over 22 surviving on less than £7 an hour and inflation, currently at 4%, expected to rise, it is Britain’s low paid millions who have been hit hardest in the post economic crash period it is time that Britain’s biggest corporations pay their workers decent wages and stop relying on government support to prop up their unfair business models.