Budget 2021: £9.50 Minimum wage rise, leaves Labour out of touch on their demands.

As the Tories announce £9.50 an hour minimum wage rise, Labour is left out of touch with members and Unions with its £10 minimum wage demand.

The chancellor is set to increase the national living wage to £9.50 in Wednesday’s budget.

It will rise by 6.6% from the current living wage of £8.91 per hour for those aged 23 and over, which the government says will give full-time workers an extra £1,000 a year.

The national living wage is what the government has called the national minimum wage for anybody above 22-years-old since 2016.

Those below that age are eligible for what is called the “national minimum wage”, which will also see a rise.

People aged 21-22 will see an increase to £9.18 an hour from £8.36 and apprentices, who must be aged 16 or over and not in full-time education, will get a rise to £4.81 from £4.30 an hour.

However, the chancellor has made no announcement on other age groups, with under 18s currently getting £4.62 an hour and 18 to 20-year-olds getting £6.56 an hour.

Despite its name, the national living wage is not based on the true cost of living, however, increasing it to £9.50 an hour brings it closer to the actual living wage of those outside London, according to the Living Wage Foundation.

Labour has demanded the hourly rate be increased to at least £10-per-hour, creating a fallout at the party’s annual conference last month over whether it should be hiked to £15.

Labour MP Andy McDonald resigned from his shadow cabinet position after saying the leadership had ordered him to argue against the rise to £15, making his position “untenable”.

It is with deep sadness that I have resigned from Keir Starmer’s Shadow Cabinet, following the leadership’s refusal to back a £15 minimum wage and statutory sick pay at the living wage. pic.twitter.com/dz1KQTj0qR

— Andy McDonald MP ? (@AndyMcDonaldMP) September 27, 2021

Starmer’s Labour outmanoeuvred.

Labour leader Sir Keir Starmer wanted to stick to plans to raise the minimum wage to at least £10-per-hour, before deciding an amount to pledge closer to the next election.

However, Labour delegates in Brighton voted in favour of the motion put forward by the Unite union to demand £15 -per-hour, which Starmer did not get to vote on.

Labour’s position on demanding £10 an hour also played into reasons why the Bakers’ union cut ties with the Labour Party. It seemed to be the straw that broke the camels back, The BFAWU’s vote to disaffiliate from the party after 100 years caused by Sir Keir Starmer’s ‘factional war’ against the left came about shortly after with is general secretary Ian Hobson stating: BFAWU members were “tremendously disappointed that they’ve been put in this position and had to take [the decision to disaffiliate].”

He said that Labour “has moved even further away from working people” during the week of its annual conference.

“I was very upset about the Sun being allowed into the conference hall, very upset that a shadow minister [Andy McDonald] has to resign because Keir Starmer doesn’t think workers deserve £15 an hour — especially after he attended our picket line in 2019 and then a Fight for £15 rally we held right after that.”

In a statement confirming its disaffiliation, the BFAWU noted that it had “levied its poorly paid members to build a party that would bring about real change” in 1902, but slammed Labour’s “failure to deliver those changes during our 119-year relationship.”

“The BFAWU will not be bullied by bosses or politicians,” the statement said. “When you pick on one of us you pick on all of us. That’s what solidarity means.”

The union asserted that it would now “become more political” and use its political fund to ensure that its members’ voices are heard.

The Bakers union were campaigning for £10 an hour way back in 2015, it seems only the workers on the ground backed by in touch unions understand the value of their work, it’s clear after fuel and energy price rises and cut to household incomes the rising cost of living that a minimum of £15 an hour in 2021 should be the baseline of demands by workers.

Chancellor Rishi Sunak said: “This is a government that is on the side of working people. This wage boost ensures we’re making work pay and keeps us on track to meet our target to end low pay by the end of this parliament.”

The Tories now claiming to be the party for workers really puts Labour on the back foot. Labour sticking to its £10 an hour really shows how out of touch they are as a party. They continue to be at odds with both their members and the Unions.

Dr Matt Johnson, senior lecturer in employment studies at Alliance Manchester Business School, said the 6.6% rise is “quite modest” because inflation is expected to hit 5% early next year.

He added that the rise coincides with the removal of the £20 Universal Credit uplift and “fails to recognise the sharp clawback of earnings” for those working and claiming Universal Credit as they will have higher tax and National Insurance contributions.

The Treasury said the changes mean the government is accepting all recommendations made by the Low Pay Commission independent advisory board.