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UK living wage rises by 20p per hour


The UK living wage has risen by 20p per hour to £7.85. The rate in London will rise from £8.80 an hour to £9.15.

The UK living wage is an hourly rate based on the amount needed to cover the basic cost of living, but it differs from the UK minimum wage.

The UK minimum wage is set by the Chancellor each year on the advice of the independent body Low Pay Commission (LPC) and enforced by HMRC. The living wage is currently calculated by the Centre for Research in Social Policy at Loughborough University, while the London living wage has been calculated by the Greater London Authority since 2005. Firms can volunteer to pay their employees this amount, but they are not legally required to. Barclays, Standard Life, the National Portrait Gallery, as well as many local councils and charities have agreed to pay their lowest paid employees the UK living wage, and citizens UK, the community organisation behind the Living Wage project, said the number of companies paying the rate had more than doubled in the past year.

Currently 22% of the working population earn less than the UK living wage. This means that 5 million people do not earn the minimum amount to lead a decent life, as that is the idea behind the UK living wage.

Former Labour MP Alan Milburn, the chairman of the Social Mobility and Child Poverty Commission, said:
"This research is further proof that more workers are getting stuck in low paid work with little opportunity for progression"

Rhys Moore, director of the Living Wage Foundation, said low pay was a strain on the public purse, as "firms that pay the minimum wage are seeing their workers' pay topped up through the benefits system".

He added that "rewarding a hard day's work with a fair day's pay" was the driving principle behind the Living Wage.

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