Hundreds of the lowest paid council workers in Northumberland could be in line for a significant pay boost as negotiations start over introducing a “living wage” policy in the county.
The new Labour administration at County Hall, which has previously indicated its support for such a move, is beginning the process with the establishment of a working group to examine the issue.
The group will report back with its findings to the council’s executive in three months time, and its work will include discussions with the authority’s trade unions and the Northern TUC.
Yesterday Labour estimated that bringing in a living wage pay structure will produce a £10m boost to the Northumberland economy through workers’ enhanced spending power.
The move would ensure that no county council worker earns less than £7.20 an hour, instead of the national minimum wage of £6.19.
Newcastle City Council is so far the only local authority in the North East to pay a living wage. Last year’s decision resulted in more than 2,200 employees receiving up to £1,100 a year extra after tax, at a cost of £1m to the council.
Northern TUC officials have also had discussions with South Tyneside and Gateshead councils, and all 12 North East councils will discuss the issue at a conference in January.
Labour bosses in Northumberland say they want to be a living wage council, despite having to make almost £70m in budget savings over the next two years and deal with what they say is a £222-per-household funding cut by the coalition Government.
The working group will look at how the authority can implement a living wage pay structure, and examine the potential knock-on effect on the local economy.
An academic report has also been commissioned and work will be done on an equality impact assessment.
Yesterday council leader Grant Davey said Labour is confident the move would benefit the Northumberland economy, because many of the workers who would get a pay rise live and shop in local communities.
He said: “There are already 51 councils across the country who’ve signed up to a living wage for their lowest paid employees and we’re keen to get on and deliver our manifesto promise to make Northumberland County Council a living wage employer.
“As communities and families face an ever-increasing struggle to make ends meet, and as coalition tax increases such as the VAT hike continue to eat into household incomes, we’re clear that we think a living wage will boost households and businesses alike.”
He added: “We’re clear that this policy is about a fair day’s pay for a fair day’s work. I’m hopeful that this policy will attract cross party support, as it’s not a party political issue.”
Beth Farhat, the new regional secretary at the Northern TUC, has said she intends to meet council chiefs to press home the issue of low pay. Newcastle City Council is planning a major management restructure to help pay for its living wage policy.