"Not feasible or desirable" to keep previous Gov's report on living wage

Tuesday 30 April 2024

The current Government has thrown out a report undertaken by previous Ministers which found that aligning the minimum wage and living wage was neither “feasible or desirable”.

Social Security Minister Lyndsay Feltham delivered the blow in this morning's States sitting when asked by Deputy Hilary Jeune how plans were progressing to determine a new living wage rate – an amount which rises in line with the latest inflation figures to acknowledge the increased cost of living.

Deputy Feltham said that transitioning the minimum wage to two-thirds of the median wage – a similar indicator to living wage – before the end of the Government term was one of her priorities and the Common Strategic Policy's priorities.

She said the current plan was to introduce an "intermediate rate" in 2025, with the full two-thirds rate to be achieved in January 2026.

The Social Security Minister added that she is working closely with Economic Development Minister Kirsten Morel on determining the intermediate rate and will shortly be asking other politicians to allow her to set the rate without going to consultation with the Employment Forum.

Very happy to hear proper commitment from @lyndsayfeltham & @lyndonfarnham to a #JerseyLivingWage in @StatesAssembly this morning. Also, correctly, a rejection of the flawed & offensive pre-Christmas report on MW/LW, happy a Living Wage is no longer considered undesirable!

— Caritas Jersey CEO (@CaritasJsyCeo) April 30, 2024

Deputy Feltham said: "I have met with the chair of the Employment Forum and I am comforted that this [decision not to have a consultation] will not be detrimental to setting an appropriate rate.

"That 2025 rate will be introduced in coming weeks, and during 2025, I will be working with Ministers to develop a set of minimum income standards for Jersey households, valuable local information which will be used to inform future living wage rate."

When asked by Deputy Kristina Moore whether she would be supporting businesses to make the transition, Deputy Feltham said that "support packages" could be available to employers, and that she remained in consultation with them.

Deputy Jeune pressed the Minister on whether this meant she was "discarding" findings of the previous Government report.

Pictured: Deputy Lyndsay Feltham is the current Social Security Minister.

Deputy Feltham said: "The report suggested that it was not feasible or desirable to move to living wage. That is not a comment I agree with, and Ministers did not have basic information such as how many people were affected, and that evidence was somewhat lacking.

"I am disregarding that report; I will not be redoing the work that had been done."

The previous Government report, commissioned by Social Security Minister Elaine Millar, concluded that "a statutory link to a specific formula or target could be counter-productive".

It argued that it would be "difficult to justify" the statutory rate, "which could not be adjusted when circumstances require it".

When the report was publish, Patrick Lynch, the CEO of Caritas Jersey, said it was "disappointing" that the charity – the only organisation in the island that provides accreditation to living wage employers – had not been consulted.

The minimum wage is currently £11.64, which has increased from £9.22 since 2022.

This is £1.77 an hour less than the £13.41 living wage for 2024 set by Caritas Jersey which is licensed by the UK's Living Wage Foundation.

In 2022, 2% of island workers were being paid at the minimum wage with another 2% close to minimum wage, with those workers concentrated in hospitality and agriculture sectors.

In addition, in 2023, 14% of private sector workers were being paid between the minimum wage and a living wage.