Lib Dems announce plans to increase minimum wage

Business Secretary Vince Cable will today set out plans for an inflation-busting increase in the minimum wage, as part of a bid to ensure economic growth benefits every section of society

Vince Cable
Vince Cable

Business Secretary Vince Cable will today set out plans for an inflation-busting increase in the minimum wage, as part of a bid to ensure economic growth benefits every section of society.

He will announce plans, also backed by Tory ministers, for a review of minimum wage, which currently stands at £6.19 an hour.

Dr Cable will say: “The National Minimum Wage is a vital safety net in protecting the low paid. However, as signs of an economic recovery start to emerge, we need to do more to make sure that the benefits of growth are shared fairly across the board.

“The Low Pay Commission every year carries out a huge amount of valuable, detailed work looking at labour conditions across the economy. Today, in addition to their ongoing annual remit, I am asking them to extend this expertise to help the government and business understand how we can deal with the issue of low wages in the economy.

“In particular I have asked them to look at what economic conditions would be needed to allow the National Minimum Wage to rise by more than current conditions allow.”

Around one in 20 workers receive the minimum wage. He will also announce proposals to end “abuse” of controversial zero hour contracts - but will argue that a blanket ban on the contracts would not make sense.

Dr Cable will say: “It is clear that they are much more widely used than we had previously thought. It is also clear that there are abuses in the system, especially around the issue of exclusivity which some employers are demanding from workers on these contracts.”

North East MEP Lib Dem MEP Fiona Hall said the party’s focus was on creating jobs. “From the North East’s point of view this is a crucial issue so I welcome the party’s focus on jobs.”

But the party leadership faces a showdown with delegates over the question of tax increases for the high-paid.

Delegates will consider whether to call for the return of a 50p tax rate for people earning more than £150,000 a year.

Party leader Nick Clegg will urge his party to support the Government’s decision to cut the tax rate to 45p. By speaking in the debate he puts himself at risk of suffering a high-profile defeat.

Delegates rejected calls to crack down on internet pornography.

Plans to block online pornography unless internet users actively “opt in” to receiving it were proposed by former children’s television presented Floella Benjamin, now a Lib Dem peer, and by Northumberland Lib Dem activist Julie Porksen.

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