Labour members present the party's "cost-of-living contract" during a campaign rally on May 21, 2014 in London. Photograph: Getty Images.
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Labour should pledge to make the government a living wage employer

Even at a time of austerity, it is a small price for a big gain. 

The government claims to be a proponent of the living wage. David Cameron says he supported it at the last election and believes it is an idea "whose time has come". Earlier this year he told the World Economic Forum in Davos that "where companies can pay the living wage, they should". Yet for all the warm words, government departments continue to drag their feet over becoming accredited living wage employers.

Rather than leading the way, ministers still insist that a living wage is a cost we perhaps can’t afford. As Lord Deighton, the Commercial Secretary to the Treasury, told Parliament in 2013: "requiring employers to pay a living wage could be burdensome to business and damage the employment prospects of low-paid workers". When confronted with the argument that it may be a price worth paying, Downing Street retorts that, anyway, living wage clauses in public procurement breach EU law (a view strong disputed by the European Commission, as well as by Boris Johnson).

If the GLA and a long list of local authorities, universities and charities can pay the living wage, why not Whitehall? Indeed, our study on "setting a fair pay standard: the government as a living wage employer" (here) shows that the cost of paying all low-paid Whitehall workers the living wage would be only £18m – equivalent to 0.002 per cent of total public spending. This would include all in-house employees as well as cleaners, security, catering staff etc who are contracted in. The cost would still be only around £23m even if contractors didn’t absorb any of the costs involved in taking pay rates up to the London living wage level (£8.80).  

Alan Buckle’s recently published report on low pay for the Labour Party recommends that central government departments should become accredited living wage employers and use the power of procurement to encourage organisations bidding for contracts to pay their staff a living wage. This would ensure that all sub-contractors pay the living wage to any staff working on government contracts. Our analysis suggests that this would cover nearly 200,000 people, and approximately 30,000 people would see their pay increase as a result. Many of those low-paid workers who would benefit are currently working for the DWP, which is committed on paper at least to paying the living wage.

There’s a lot of complex number crunching involved in evaluating the cost to government of paying the living wage. Some workers are paid close to the living wage which means the uplift costs are low, others are on the National Minimum Wage and could see their wages rising significantly; there are issues around how much different contractors in different services can afford to contribute, and how phasing might operate; how best to factor in know-on employment effects and productivity gains; and what impact will pay rises at the bottom have on wage differentials? All are important considerations, but not impossible for government to work out. What is most striking is that the overall costs to the taxpayer are low because government gets a dividend back from tax receipts and reduced benefit payments. According to our analysis, the tax and benefit savings of moving 30,000 workers onto the living wage would be some £20m. That’s roughly half the total cost of becoming a living wage employer.

Ed Miliband has flirted with several ideas over how to support the living wage, including council-backed living wage zones and tax breaks to private firms. Each have their merits and demerits. But surely it is best to start with the public sector. Government, after all, is a major employer of low-paid workers and has huge buying power. Ministers can set the pace on the living wage and force and cajole the business community to follow.

In Scotland, Holyrood recently voted down an amendment to the Procurement Reform Bill by Labour to introduce a "Scottish Living Wage duty" - which would make it compulsory for companies who wanted to win work from the public sector to pay the living wage. This was something of an embarrassment for the SNP, which boasts that the Scottish government is an accredited living wage employer.

Labour should be bolder on the living wage than Salmond or Cameron and give a clear and unequivocal commitment over the term of a parliament to making not just Whitehall, but all public bodies living wage employers. The opportunity is there to outflank the Tories, whose credibility on tackling low pay and endorsement of the living wage needs to be challenged. There is a cost and the big contractors will fight against paying their share, but as our report shows, even at a time of fiscal austerity, it is a small price for a big gain. 

Paul Hackett is the director of The Smith Institute.

Nicola Sturgeon and Tony Blair. Photo: Getty
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Nicola Sturgeon's SNP, like Tony Blair's New Labour, is heading for a crash landing

The fall of Tony Blair should be a set text for anyone wishing to know what happens next to the SNP.

If there was one thing the SNP and New Labour had in common, it was the hope. Both offered themselves as a burning torch of optimism to publics that had become tired of the same old gang running things in the same old way. Both promised a fairer, more equal society and a fearless embrace of the modern world with an appealing freshness and energy. The voters bought it: both won big, repeatedly.

The thing is, if you’re elected on a mandate to be different, you’d better be different. In many areas, for a long time, New Labour managed to be just that. The smiling PM with the huge majority pushed through radical policies, some of which even worked. Tony Blair’s methodology was so successful and so convincing that the Conservatives and the Lib Dems reshaped themselves in his likeness. Arguably, a form of New Labour won in 2010 and 2015.

But, as they say, it’s the hope that kills you. When the inevitable attritional realities of governing start to weigh, when you make, as you will, bad decisions, when the list of enemies grows long, when you’ve just had your time, you’ll fall like all the rest – only, when you’ve soared so close to the sun, you have that much further to plummet.

The fall of Blair and of Labour should be a set text for anyone wishing to know what happens next to the SNP. Sunday night’s debate between the Scottish party leaders was, I think, a foretaste of what’s coming – a public that until recently was politically and emotionally invested in the Nats is growing restive. In time, this will turn to disenchantment, then anger, then revenge at the ballot box. This is the unbreakable cycle of democratic politics.

Some of us have warned since the start that the SNP had over-promised and could only under-deliver. Its raison d’etre is independence; everything else - literally everything else - is just another brick to build the path. And so education reform cannot be either radical or unpopular, even if it needs to be so to work, because the SNP cannot afford to alienate teachers or the teaching unions or parents. Bricks, you see. Same with the NHS and doctors and health unions and patients. All the separatists have done – all they could have done, given their nature - is deploy the rhetoric of the radical while in reality body-swerving hard choices and conflict at any cost. And where they have found themselves taking flak, they’ve pointed south to Westminster: "it’s no’ our fault, it’s theirs".

But voters show signs of wearying of the predictable blame game and waking up to the time-limited strategy of show-over-substance. Middle Scotland is either ignored or maligned by the middle-class socialists who drive the nation’s political debate, but it is where elections are won. The SNP has secured the support of enough of these people to win every recent election in style, but somewhere along the way the party seems to have forgotten this was a mandate not for independence, but for good government. Ten years in to SNP rule, each new audit of public services seems to wail like a warning siren – things aren’t just not improving, they’re getting worse. The SNP is not keeping its part of the deal.

So, during Sunday night’s debate it was Nicola Sturgeon, not Ruth Davidson or Kezia Dugdale, who found herself in the audience’s cross-hairs. It will have been a strange experience for a woman more used to public adulation and a clamour for selfies. There were the teachers, who complained about the damp squib that is the Curriculum for Excellence, the SNP’s flagship education policy; who pointed out that a fifth of primary pupils are leaving without basic literacy and numeracy skills; and who warned that lowering the standard of exams in order to push up the pass rate was not a mark of success.

Then there was the nurse who said she had been forced to use a food bank (the existence of which has been used repeatedly by the SNP as a stick with which to beat the Conservatives and Westminster): ‘I can’t manage on the salary I have [which is set by the Scottish Government]. You have no idea how demoralising it is to work in the NHS. Don’t come on your announced visits, come in in the middle of any day to any ward, any A&E department and see what we’re up against.’ She delivered the evening’s killer line: ‘Do you think your perceived obsession with independence might actually cost you… in this election?’

The list of reasonable criticisms is growing and will grow further. The ideological obsession with free university tuition for Scottish students is increasingly seen as a sop to the better-off, while in England the fee-charging regime has seen the number of students coming from poorer families climb. Ms Sturgeon’s demand for a quick second independence referendum, when a worried middle Scotland was focused on what Brexit might mean for its future, was tone deaf.

The SNP has another problem (one that New Labour, for all its flaws, didn’t face): its doctrine of infallibility. The Nats’ constitution explicitly prohibits its elected members from criticising the party, its policies or each other. While total unity is useful when you’re on the climb, it starts to look bonkers when the cracks are showing. Allowing public self-criticism, far from being a sign of weakness, is a necessary vent for inner tensions and a sign to voters that a political party is something more than a cult.

That ‘cult’ word has long dogged the SNP and its supporters. The party has tried hard to normalise its electoral appeal while keeping the flame of independence burning bright, but it has been a difficult balancing act. The pro-independence mob is an ugly thing when it is unleashed (and it has suited the leadership to open the cage at times). Claire Austin, the nurse who criticised the First Minister on Sunday, has found herself at its mercy. Immediately after the debate, the Nats briefed (wrongly) that she was the wife of a Tory councilor. The SNP branch in Stirling said Tebbitishly that if she was having to use food banks "maybe she needs to tighten her belt a bit more?" Joanna Cherry, a QC, MP and the SNP’s Home Affairs spokesperson, was forced to publicly apologise for spreading "Twitter rumours" about Ms Austin.

The ravening horde has largely kept its head down since the 2014 independence referendum, but we now see it hasn’t gone away - it is not enough for the SNP’s critics to be debated, they must be destroyed. This isn’t the behaviour of a normal political party: it’s the behaviour of a cult.

I might be wrong, but I have a feeling that when the SNP does fall it will fall quite quickly. Its belief in its infallibility, its inability or unwillingness to do self-deprecation or apology, will increasingly aggravate voters. There is nothing to suggest the current public policy failings will be addressed, and plenty of signs that things will get worse. How, then, do you arrest your fall?

The SNP offered hope and promised it was different, and the voters believed. The sense of betrayal could make for a very hard landing indeed.

Chris Deerin is the New Statesman's contributing editor (Scotland). 

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