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| Duncan Smith: Welfare changes will make living wage easier | Duncan Smith: Welfare changes will make living wage easier |
| (about 2 hours later) | |
| Changes to in-work benefits will increase incomes, making it easier to ensure firms pay staff a "living wage", Iain Duncan Smith has said. | Changes to in-work benefits will increase incomes, making it easier to ensure firms pay staff a "living wage", Iain Duncan Smith has said. |
| The work and pensions secretary's prediction comes as Labour is urging employers to increase salaries or face being named and shamed. | The work and pensions secretary's prediction comes as Labour is urging employers to increase salaries or face being named and shamed. |
| A living wage, described as that needed to live comfortably, is defined as £7.20 an hour, or £8.30 in London. | A living wage, described as that needed to live comfortably, is defined as £7.20 an hour, or £8.30 in London. |
| A recent study suggests a fifth of workers are earning below this level. | A recent study suggests a fifth of workers are earning below this level. |
| In an interview with the Independent on Sunday, Labour leader Ed Miliband said a living wage was part of his "One Nation" vision to share prosperity. | In an interview with the Independent on Sunday, Labour leader Ed Miliband said a living wage was part of his "One Nation" vision to share prosperity. |
| The party is looking at ways of making the pay terms the new norm, including naming and shaming listed companies who do not pay it. | The party is looking at ways of making the pay terms the new norm, including naming and shaming listed companies who do not pay it. |
| 'Proper stake' | 'Proper stake' |
| It is also considering introducing rules that will see Whitehall contracts awarded to firms who pay workers the living wage or above and giving Treasury-funded incentives to companies who introduce the wage structure. | |
| Mr Miliband said: "We've got a growth crisis in Britain but we've also got a living standards crisis, because the proceeds of economic growth are not being fairly distributed any more. | Mr Miliband said: "We've got a growth crisis in Britain but we've also got a living standards crisis, because the proceeds of economic growth are not being fairly distributed any more. |
| He added: "It is about giving people a proper stake in the future of the country." | He added: "It is about giving people a proper stake in the future of the country." |
| The Institute for Fiscal Studies estimates that for every person moved on to the living wage, the Treasury would save around £1,000 from less spending on tax credits and from increased tax revenue. | The Institute for Fiscal Studies estimates that for every person moved on to the living wage, the Treasury would save around £1,000 from less spending on tax credits and from increased tax revenue. |
| A number of major firms already pay workers and contractors a living wage or higher. | A number of major firms already pay workers and contractors a living wage or higher. |
| Barclays has paid the living wage in London since 2007, while 19 local authorities have been accredited as "living wage employers". | Barclays has paid the living wage in London since 2007, while 19 local authorities have been accredited as "living wage employers". |
| Mr Duncan Smith is setting up policies he says will make work more profitable than claiming unemployment, including a cap on out-of-work payments and creating a universal credit to replace several existing payments for those in work but on low incomes. | Mr Duncan Smith is setting up policies he says will make work more profitable than claiming unemployment, including a cap on out-of-work payments and creating a universal credit to replace several existing payments for those in work but on low incomes. |
| 'Boost' | 'Boost' |
| He told BBC One's Andrew Marr Show: "I think it's important because there's no question now that we have an issue about in-work poverty and that's the bit I'm trying to tackle. | He told BBC One's Andrew Marr Show: "I think it's important because there's no question now that we have an issue about in-work poverty and that's the bit I'm trying to tackle. |
| "Universal credit, the new benefit, actually shifts 80% of the money down to the bottom 40% who are in work essentially. And that will hugely boost their incomes and so eradicate a lot of that. | "Universal credit, the new benefit, actually shifts 80% of the money down to the bottom 40% who are in work essentially. And that will hugely boost their incomes and so eradicate a lot of that. |
| "Now that will leave it possible for businesses to think about then topping up to a living wage." | "Now that will leave it possible for businesses to think about then topping up to a living wage." |
| The living wage is voluntary, unlike the National Minimum Wage - the amount that employers must pay by law, which is set at £6.19 an hour for those aged 21 and over. | The living wage is voluntary, unlike the National Minimum Wage - the amount that employers must pay by law, which is set at £6.19 an hour for those aged 21 and over. |
| One in five workers in the UK is paid less than the living wage, a report by accountants KPMG suggested last week. | One in five workers in the UK is paid less than the living wage, a report by accountants KPMG suggested last week. |
| The report suggested that Northern Ireland had the highest proportion of people earning below the living wage, at 24% of workers, followed by Wales at 23%. | The report suggested that Northern Ireland had the highest proportion of people earning below the living wage, at 24% of workers, followed by Wales at 23%. |
| The lowest levels were in London and the South East of England, both at 16%, it said. | The lowest levels were in London and the South East of England, both at 16%, it said. |