Labour promises pay rise of over £2,600 per year as new analysis shows nearly 13 million adults in working households without any savings

Jeremy Corbyn MP, Leader of the Labour Party, has hit out at the government for “creating a perfect storm of low pay, insecurity and working poverty” that is “causing terrible stress for millions of families across the country”.

• ·         This comes as new House of Commons Library analysis shows that Labour’s pledge to raise the National Living Wage to £10 an hour in 2020 would give a pay rise of £2,640 to those on the National Living Wage. 
• ·         New analysis from Labour has also revealed that the number of adults living in families where one or more person is working, who do not have any savings has risen to 12.8 million. This is an increase in 2.5 million since 2010 and an increase of over million between 2015/16 and 2016/17 alone.
• ·         This comes in the same week the ONS confirmed that household debt has been steadily increasing since 2013, with household debt now at 133 per cent of income.

Jeremy Corbyn will use a visit to Worcester Housing and Benefit Advice Centre, a charity offering advice and support to people struggling with rent arrears, debt and problems with benefits, to highlight rising levels of insecurity and poverty and set out Labour’s policies to introduce a Real Living Wage of £10 an hour, stop the roll out of Universal Credit and ban zero-hours contacts.

Jeremy Corbyn MP, Leader of the Labour Party, said:

“With real wages lower than they were ten years ago, deep cuts to social security, rising borrowing just to make ends meet and the growth of insecure work, the Conservatives have created a perfect storm of low pay, insecurity and working poverty.

"This rising insecurity, with so many without savings to fall back on, is causing terrible stress for millions of families across the country.

“These scandalous levels of in-work poverty are unacceptable and must be brought to an end. Every job should provide dignity and security. That's why the next Labour Government will introduce a Real Living Wage putting over £2600 per year more in the pockets of around 6 million low paid workers, stop the roll out of Universal Credit and ban zero-hours contracts.

Ends

Notes to Editors:

• ·         Labour’s 2017 manifesto promised to raise the minimum wage to £10 an hour by 2020. “Raise the Minimum Wage to the level of the Living Wage (expected to be at least £10 per hour by 2020)” Source: Page 47, Labour 2017 General Election Manfesto, https://labour.org.uk/wp-content/uploads/2017/10/labour-manifesto-2017.pdf

• ·         Latest OBR projections show that the Tories supposed National Living Wage, will increase to £8.65 an hour in 2020. Source: 29 October 2019, OBR Supplementary Table 1.18,https://obr.uk/download/october-2018-economic-and-fiscal-outlook-supplementary-economy-tables/ 

• ·         House of Commons analysis shows that those on the lowest wage will get a pay increase of around £2640 a year.

• ·         The Resolution Foundation shows that there were around 6,230,000 people earning below the Living Wage in 2017. Source: May 2018, page 50, Resolution Foundation,https://www.resolutionfoundation.org/app/uploads/2018/05/Low-Pay-Britain-2018.pdf  

• ·         At the same time labour analysis, using DWP StatXplore to analyse DWP Statistics on Households below Average Income, show there are nearly 13 million adults in working households with no savings. Since 2010/11, that is an increase of over 2.5 million people, with an increase of a million between 2015/16 and 2016/17 alone.

• Further analysis shows that in single and couple households where all adults are in full-time work, there are over a million more adults without savings.

• ONS figures released on Monday 4 February 2019, show that household debt has been increasing steadily since 2013 with household debt now at 133% of income. “Household debt – which is comprised of secured (mortgages) and unsecured lending (credit cards and overdrafts) – has been increasing steadily since 2013.” Source: ONS, 4 February 2019, https://www.ons.gov.uk/peoplepopulationandcommunity/wellbeing/bulletins/personalandeconomicwellbeingintheuk/september2018 

• ·         There are four million working people living in poverty. “Four million workers are living in poverty – a rise of more than half a million over five years.” Source: Joseph Rowntree Foundation, ‘UK Poverty 2018’, 4 December 2018,https://www.jrf.org.uk/report/uk-poverty-2018

• Half a million more children are living in relative poverty compared with 2010.

Source: DWP Statistics on Households below Average Income, Table 4.3tr: Number of children falling below various thresholds of contemporary median income', 22 March 2018,

https://www.gov.uk/government/statistics/hbai-199495-to-201617-children-data-tables

• The Joseph Rowntree Foundation has said “In-work poverty has been rising even faster than employment, driven almost entirely by increasing poverty among working parents.” Source:Joseph Rowntree Foundation, ‘UK Poverty 2018’, 4 December 2018,https://www.jrf.org.uk/report/uk-poverty-2018

• The UN Special Rapporteur on extreme poverty and human rights said Ministers are in a “state of denial” about poverty in the UK. 

“But through it all, one actor has stubbornly resisted seeing the situation for what it is. The Government has remained determinedly in a state of denial.”

Source: Phillip Alston, ‘Statement on Visit to the United Kingdom, by Professor Philip Alston, United Nations Special Rapporteur on extreme poverty and human rights’, 16 November 2018,

https://www.ohchr.org/EN/NewsEvents/Pages/DisplayNews.aspx?NewsID=23881&LangID=E

• Labour in government has pledged to:
• • introduce a Real Living Wage of £10 an hour by 2020
  • ban zero-hour contracts
  • stop the roll out Universal Credit
  • implement a new Child Poverty Strategy.