Gavin Handman

The UK living wage

The UK ‘living wage’ - an hourly rate based on the amount needed to cover the basic costs of living – was recently raised by 20p to £7.85.

Gavin Handman
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15th December 2014
London 8
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The UK ‘living wage’ - an hourly rate based on the amount needed to cover the basic costs of living – was recently raised by 20p to £7.85.

The voluntary wage - set by the Living Wage Foundation - is now 21% higher than the compulsory National Minimum Wage (NMW), which is currently £6.50 an hour.

The living wage rate in London also rose from £8.80 an hour to £9.15.

Despite this rise, research published recently by accounting firm KPMG - a supporter of the wage - found 22% of the working population earn less than the 2013 living wage - which was set at £7.65 an hour.

More than five million people are still paid below that rate and women are more likely to earn less than men. So, how are they supposed to pay their bills, mortgage or accommodation/housing?

One example is Toni, who feels she is “being left behind in general”. She is only employed for 18 hours a week. She brings home £600 a month and attempts over the past year at finding a second or a better-paid job have been fruitless. She is well educated but doing a low-skilled repetitive job that has a high staff turnover, because it is stressful to do for so little in return.

It is very clear from government statistics on unemployment and the small number of vacancies available that there are just not enough jobs to go around. She does not have children but says that she cannot see a future with them, as raising a family on her current means would be “nothing short of hell for everyone involved”.

She currently lives in a shared five-bedroom house and pays £255 a month. Bills are approx £100 a month. The rest of her money goes on food and she tries to keep a little aside just as a buffer as she hates being overdrawn. She can’t afford to go on nights out and her only weakness is chocolate, which she has tried to cut down for health and money reasons.

She feels very disheartened, knowing that she will never be able to afford to rent or own a nice place. Living this way after university has also taken a huge toll on her physical and mental health.

Unite, the country’s largest union, which represents 80,000 members in local authorities, also criticised the government for allowing vital local government staff to struggle to pay their bills on the new NMW. Thousands of local government workers are now struggling to pay their household bills and mortgages.

Care workers, cleaners, catering and school support staff, providing vital services to children, the elderly and vulnerable, will be desperately trying to make ends meet this Christmas and are facing a winter of poverty, choosing between heating and eating. The majority of the workforce – 77% – is made up of women, many working part-time, who are trying to cope on these low wages.

However, there is a solution on the horizon for those on the NMW or living wage, who are struggling to pay for their housing and bills: becoming a property guardian. They can secure affordable, large rooms in unusual buildings, such as former offices and community centres, for as little as £50 a week by applying to become a guardian.

We have guardians currently living in a former pizza restaurant and in a former bowling green pavilion! They have been able to adapt the space to suit themselves and pay a fraction of what they previously paid in tiny rooms in unsavoury areas. This kind of housing scheme can provide light at the end of the tunnel, helping people to avoid a financial nightmare.

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