Tag: TUC

Trade unions call for ‘emergency support’ from Chancellor in response to Ukraine crisis

Trade unions and the TUC have written to the Chancellor calling on him to use his spring statement to introduce ‘emergency support’ in response to the conflict in Ukraine.

This includes measures to support Ukrainian refugees, ensure that sanctions are effective, and protect UK families from the impact of rising energy prices.

The TUC has condemned the invasion of Ukraine, expressed its solidarity with the Ukrainian people, and called on governments to pursue all diplomatic efforts towards peace.

The letter from the TUC and unions says that the Chancellor must now step up with new financial measures to both support the Ukrainian people, and respond to the impact of the conflict on the cost-of-living crisis in the UK.

The letter calls on the Chancellor to:

  • Ensure that sanctions are effective by increasing enforcement funding for measures in the economic crime bill that would crack down on money-laundering in the UK; and consider a 100 per cent windfall tax on the profits of companies still invested in Russian state enterprises. 
  • Provide safe routes to the UK for those fleeing the conflict, and scrap legislation plans that would close the door on all people fleeing war and threats to their lives. 
  • Fund wider humanitarian assistance for displaced people, including essential medical supplies.
  • Protect working families against further energy price rises as a result of the crisis, by giving grants rather than loans to recued energy bill, increasing the warm homes discount, increasing universal credit, and accelerating a home energy efficiency retrofit programme. 

The letter also calls on the government to ensure that those working in supply chains are protected from disruption, including by considering the use of a short-time working scheme.

TUC General Secretary Frances O’Grady said: “Trade unions condemn the illegal invasion of Ukraine. We know that working people in Ukraine, Russia and across Europe want peace. The UK government must pursue all diplomatic efforts to achieve that goal.

“The Chancellor must use his spring statement to act too. That means ensuring that sanctions are more effective, with funding to crack down on money-laundering in the UK. And he should fund greater humanitarian assistance for Ukrainians, including safe passage for those fleeing the war. 

“Working people in the UK will need protection from even steeper hikes in gas bills from the conflict. The Chancellor should introduce grants to help with energy prices, roll out an emergency programme of home insulation, and fund it with a windfall tax on excess energy profits.”  

“The government must provide safe routes to the UK for those escaping conflict. And ministers should scrap their Nationality and Borders Bill, which will close the door to people fleeing war and threats to their lives.”

Full text of the letter to the Chancellor:

Dear Chancellor 

Protecting working people from the impact of the invasion of Ukraine

The trade union movement is united in its condemnation of Russia’s illegal invasion of a sovereign nation. Our solidarity is with the working people of Ukraine. Working people always suffer in conflict and the pursuit of peace is a fundamental trade union value, an essential condition to secure safety, social justice and workers’ and human rights. 

The UK government must now take further action to support and strengthen international efforts to impose significant and effective sanctions on Russia and to support all diplomatic efforts towards peace. And it must play its part in supporting humanitarian assistance for forcibly displaced people and welcoming refugees seeking to come to the UK. 

The government must also ensure that it takes every step possible to protect working people here at home from the impact of the conflict and measures taken in response to this. We urge you to use your forthcoming budget to act. We call on you to:  

  • Target sanctions on wealthy elites linked to the Russian government – and ensure they are effective.  We welcome the proposed register of overseas owners of UK property through the Economic Crime (Transparency and Enforcement) Bill, but this needs to be backed up by sufficient powers and funding for Companies House to enforce. 
  • Fund humanitarian assistance for displaced people, and welcome refugees to the UK. The new Ukrainian visa proposals are inadequate and fall well short of what is needed. Limiting asylum to Ukrainian immediate family members of those already settled in the UK will not reassure Ukrainians fleeing war and bloodshed that they will be able to seek sanctuary in our country. The government must establish a safe route, so all Ukrainian families, who through no fault of their own have been forced from their homes, can easily apply for a humanitarian visa to travel to the UK. The Nationality and Borders Bill must be scrapped. Thousands of Ukrainians fleeing war may try to find sanctuary in the UK.  If the Bill is passed many of these Ukrainians, along with others around the world fleeing conflict, threats to their lives and seeking safety may find themselves treated as criminals and deported, instead of being offered sanctuary.
  • Protect working families against rising gas prices, by raising funds through a windfall tax on energy profits and a new tax on profits made by UK companies invested in Russian state businesses. The current energy price crisis is hitting workers hard, and prices are likely to rise further. Government should implement existing TUC calls for: 
  • Support for households in the form of a grant, not a loan (replacing the energy price rebate proposed by the government). 
  • An increase in the warm homes discount, and a permanent increase in Universal Credit. 
  • Rapid implementation of an accelerated and expanded domestic home retrofit programme, delivered by local councils who are best placed to deliver fast 
  • Funding for these measures by the implementation of a windfall tax on north sea oil and gas companies. 
  • An immediate increase in the national minimum wage to at least £10 an hour and a strategy to protect pay across the economy, including public services.

In addition, the government should consider implementing a new 100 per cent tax on additional profits made by UK based companies from their shareholdings in Russian state-backed enterprises that have profited from the gas price crisis. For example, this includes profits made by oil companies Shell and Vitol from their shareholdings in oil and gas fields in Russia in joint ventures with state-controlled companies Rosneft and Gazprom. 

  • Protect jobs in supply chains now and build future supply chain resilience. Forcompanies sourcing parts and supplies from Russia, sanctions could have a significant impact. To protect jobs, the UK government should: 
  • Re-introduce the furlough scheme or a permanent short-time working scheme in order to allow companies to protect jobs while they seek to shift their supply chains. 
  • Begin an urgent programme to provide investment support to help companies to invest in UK supply chains and jobs. 

Trade union leaders would be happy to meet you to discuss these issues, and the steps we must take now to support working people in Ukraine and in the UK, 

Yours sincerely 

Frances O’Grady, General Secretary, TUC 

Sue Ferns, President, TUC

Christina McAnea, General Secretary, UNISON

Sharon Graham, General Secretary, Unite

Gary Smith, General Secretary GMB 

Kevin Courtney and Mary Bousted, Joint General Secretaries, NEU

Paddy Lilis, General Secretary, Usdaw

Patrick Roach, General Secretary, NASUWT

Dave Ward, General Secretary, CWU

Mark Serwotka, General Secretary, PCS

Mike Clancy, General Secretary, Prospect 

Ged Nichols, General Secretary, Accord 

Ukraine: what you can do to help

Everyone wants to do their bit to support those who have been forced to flee their homes because of the invasion. Here is how you can help.

Financial donations

If you want to donate money, there are a number of charities providing humanitarian relief in Ukraine.

The UK Government will match public donations to this appeal pound-for-pound up to £25 million.

Make your donation safely

There are lots of organisations across the UK and internationally who have launched appeals, and you may wish to donate through these organisations instead. There are some simple steps you can take to ensure your money is safe and being used effectively:

  • Check the charity’s name and registration number using the search the charity register tool
  • Most charities with an income of £5,000 or more must be registered, which means they are regulated by The Charity Commission
  • Make sure the charity is genuine before giving any financial information
  • If in doubt, ask the charity or organisation for more information

Donating essential supplies

One of the best ways to help is by donating cash through trusted charities and aid organisations, rather than donating goods. Cash can be transferred quickly to areas where it is needed and individuals and aid organisations can use it to buy what is most needed. Unsolicited donations of goods, although well-meant, can obstruct supply chains and delay more urgent life-saving assistance from getting through.

Organisations across the UK are gathering essential supplies, such as clothes, first aid and sanitary products. Many charities and community groups will have lists of items they need.

Charities with experience of responding to disasters are best placed to reach victims on the ground.

Apply to be a sponsor

The government will be launching a new sponsorship scheme to make sure that Ukrainians who have been forced to flee their homes have a route to safety.

The scheme will match people, charities, businesses and community groups to Ukrainians who do not have family ties to the UK.

Details of the scheme and how you can apply will be published shortly by the Department for Levelling Up, Housing and Communities.

Social media – staying safe online

The UK Government, Ukrainian Government and others have been sharing messages of support on social media using the hashtag #StandForUkraine

Take care what you share! There is a lot of false information about the conflict circulating online – this is often called misinformation and disinformation. You can do your part to stop the spread:

  • Ask yourself – does this look right? Does this sound right? Does this information come from a source I recognise?
  • The SHARE checklist can help you decide if information can be trusted, before you interact with or share it on your social media channels

Cyber security

The National Cyber Security Centre is not aware of any specific cyber threats to the UK in relation to the Russian invasion of Ukraine. However we strongly encourage organisations and citizens to follow NCSC guidance on steps to take when the cyber threat is heightened.

Visit the Cyber Aware website where you find practical steps and tools to help keep you, your family or business more secure online.

#StandWithUkraine

Workers say no to increased surveillance since COVID-19

New TUC polling reveals majority of workers say they have experienced surveillance in the past year

  • Overwhelming support for stronger regulation to protect workers from punitive use of AI and surveillance tech 
  • Post Office scandal must be a turning point on uncritical use of worker monitoring tech, says TUC 

Intrusive worker surveillance tech and AI risks “spiralling out of control” without stronger regulation to protect workers, the TUC has warned. Left unchecked, the union body says that these technologies could lead to widespread discrimination, work intensification and unfair treatment.  

The warning comes as the TUC publishes new polling, conducted by Britain Thinks, which reveals an overwhelming majority of workers (60 per cent) believe they have been subject to some form of surveillance and monitoring at their current or most recent job. 

The TUC says workplace surveillance tech took off during the pandemic as employers transferred to more remote forms of work. 

Surveillance can include monitoring of emails and files, webcams on work computers, tracking of when and how much a worker is typing, calls made and movements made by the worker (using CCTV and trackable devices). 

Three in 10 (28 per cent) agree monitoring and surveillance at work has increased since Covid – and young workers are particularly likely to agree (36 per cent of 18-34 year olds). 

There has been a notable increase in workers reporting surveillance and monitoring in the past year alone (60 per cent in 2021 compared to 53 per cent 2020).  

In particular, more workers are reporting monitoring of staff devices (24 per cent to 20 per cent) and monitoring of phone calls (14 per cent to 11 per cent) compared to 2020. 

In calling for stronger regulation, the TUC highlights the recent Post Office scandal which saw hundreds wrongly prosecuted for theft and false accounting after a software error – and says it must be a turning point on uncritical use of worker monitoring tech and AI. 

Creeping role of surveillance 

The creeping role of AI and tech-driven workplace surveillance is now spreading far beyond the gig economy into the rest of the labour market, according to the TUC.  

The following sectors have the greatest proportion of workers reporting surveillance: 

  • financial services (74 per cent) 
  • wholesale and retail (73 per cent) 
  • utilities (73 per cent) 

The union body warns of a huge lack of transparency over the use of AI at work, with many staff left in the dark over how surveillance tech is being used to make decisions that directly affect them. 

The use of automated decision making via AI includes selecting candidates for interview, day-to-day line management, performance ratings, shift allocation and deciding who is disciplined or made redundant. 

The TUC adds that AI-powered technologies are currently being used to analyse facial expressions, tone of voice and accents to assess candidates’ suitability for roles. 

To combat the rise of workplace surveillance tech and “management by algorithm”, the TUC is calling for: 

  • A statutory duty to consult trade unions before an employer introduces the use of artificial intelligence and automated decision-making systems. 
  • An employment bill which includes the right to disconnect, alongside digital rights to improve transparency around use of surveillance tech  
  • A universal right to human review of high-risk decisions made by technology   

The TUC points out that the government recently consulted on diluting General Data Protection Regulation (GDPR) as part of its post-Brexit divergence agenda, despite it providing some key protections for workers against surveillance tech. 

The EU is currently putting in place laws dealing specifically with the use of AI, whereas the UK does not have anything like this. The TUC says this is yet another example of the UK falling behind its EU counterparts on workers’ rights. 

There is significant and growing support among workers for stronger regulation of AI and tech-driven workplace surveillance: 

  • Eight in ten (82 per cent) now support a legal requirement to consult before introducing monitoring (compared to 75 per cent in 2020)  
  • Eight in 10 (77 per cent) support no monitoring outside working hours, suggesting strong support for a right to disconnect (compared to 72 per cent in 2020) 
  • Seven in 10 (72 per cent) say that without careful regulation, using technology to make decisions about workers could increase unfair treatment (compared to 61 per cent 2020). 

Last year the TUC launched its manifesto, Dignity at work and the AI revolution, for the fair and transparent use of AI at work. 

TUC General Secretary Frances O’Grady said: “Worker surveillance tech has taken off during this pandemic – and now risks spiralling out of control. 

“Employers are delegating serious decisions to algorithms – such as recruitment, promotions and sometimes even sackings. 

“The Post Office scandal must be a turning point. Nobody should have their livelihood taken away by technology. 

“Workers and unions must be properly consulted on the use of AI, and be protected from its punitive ways of working.  

“And it’s time for ministers to bring forward the long-awaited employment bill to give workers a right to disconnect and properly switch off outside of working hours.” 

Gender pay gap means women work for free for two months of the year

New TUC analysis reveals Women’s Pay Day – the day when the average woman starts getting paid compared to the average man – was Friday 25 February. In Scotland, the date was 11 February.

  • In parts of the country where the gender pay gap is wider, women work for free for longer. And in finance and insurance, women wait until 27 April for their Women’s Pay Day 
  • TUC calls on ministers to boost rights to flexible working, and for cash injection for childcare sector 

The average woman effectively works for free for nearly two months of the year compared to the average man, according to new analysis published by the TUC. 

The gender pay gap for all employees is 15.4 per cent. This pay gap means that women wait 56 days before they start to get paid on Women’s Pay Day today. 

Industrial gender pay gaps 

Despite the introduction of gender pay gap reporting, the analysis published by the TUC today shows that there are still big gender pay gaps in many industries. 

Even in jobs that tend to be dominated by female workers like education and social care the gender pay gap persists. 

In these sectors women get paid much less per hour on average than men, both because they are more likely to be in part-time jobs or are in lower-paid roles.  

  • In education the gender pay gap is 25.4 per cent, so the average woman effectively works for free for more than a quarter of the year (93 days) and has to wait until Saturday 2 April 2022 before she starts getting paid compared to the average man. 
  • In health care and social work jobs, where the gender pay gap is 18.3 per cent, the average woman waits 67 days for her Women’s Pay Day on Monday 7 March 2022. 

The longest wait for Women’s Pay Day comes in finance and insurance. The gender pay gap (32.3 per cent) is the equivalent of 118 days, meaning it’s nearly a third of the year before Women’s Pay Day finally kicks in on 27 April 2022. 

Generational gender pay gaps 

The TUC analysis shows that the gender pay gap is widest for older women, so they have to wait longer for their Women’s Pay Day. 

  • Women aged between 40 and 49 have a pay gap of 21.3 per cent and work for free until Friday 18 March 2022. 
  • And women aged 50 and 59 have the highest gender pay gap (21.8 per cent). They work 80 days of the year for free before they are paid on Sunday 20 March 2022. 

Regional gender pay gaps 

The analysis also shows that in some parts of the country gender pay gaps are even bigger, so their Women’s Pay Day is later in the year. 

  • The gender pay gap is largest in the south east (18.9 per cent). Women in this region work 69 days for free and their pay day isn’t until Wednesday 9 March. 
  • And women in the south west (16.6 per cent) and the east midlands (16.8 per cent pay gap) have to wait until next week (Tuesday 1 March and Wednesday 2 March) for their pay days. 

Regional variations in the gender pay gap are likely to be caused by differences in the types of jobs and industries that are most common in that part of the UK, says the TUC. 

TUC General Secretary Frances O’Grady said: “It’s shocking that working women still don’t have pay parity. At current rates of progress, it will take nearly 30 more years to close the gender pay gap. 

“It’s clear that just publishing gender pay gaps isn’t enough. Companies must be required to explain what steps they’ll take to close their gender pay gaps – and bosses who don’t comply with the law should be fined. 

“The last two years have shown us that employers can do more to help women balance caring responsibilities and work. Flexible working is vital to mums keeping their jobs and progressing at work and is our best chance of closing the gender pay gap. 

“All jobs must be advertised with the possible flexible options clearly stated, and all workers must have the legal right to work flexibly from their first day in a job.” 

Childcare and parental leave 

Frances added: “The gender pay gap widens dramatically once women become mums. We need more funding for affordable, good quality childcare to support working parents – along with better wages and recognition for childcare workers. 

“And both parents need to be able to share childcare more easily. Without better rights to well-paid leave, mums will continue to take on the lion-share of caring responsibilities – and continue to take a financial hit. 

“We need a complete overhaul of the shared parental leave system. It’s not an affordable option for most working families. Dads need leave they can take in their own right. It shouldn’t rely on mums giving up some of their maternity leave.” 

Number of workers on universal credit up by 1.3 million since the eve of the pandemic

  • 130% rise in working claimants during the pandemic 
  • Low-income workers facing “perfect storm” this spring unless ministers improve “woefully inadequate” levels of support, warns union body 
  • Cost-of-living crisis already depressing value of UC, TUC analysis reveals 
  • *NEW POLL* shows many families already struggling to make ends meet 

The TUC has warned that millions of low-income workers face a “perfect storm” this April with universal credit (UC) falling behind the cost of living as energy bills and taxes rise. 

The warning comes as new TUC analysis reveals that the number of workers on UC has increased by 1.3 million since the eve of the Covid-19 pandemic. 

The analysis of official statistics shows that over 2.3 million workers were in receipt of UC at the end of 2021, compared to just over one million on the eve of the pandemic in February 2020. 

This represents an increase of 130 per cent over the last two years and means 1 in 14 (7.2 per cent) working adults now claim UC. 

The TUC says the huge rise in UC recipients has been driven by working households being pushed into financial hardship during Covid, with millions facing a cost-of-living crunch this year. 

Basic value of universal credit now lower than at start of pandemic 

The TUC says that the basic value of UC is now lower than at the start of the pandemic as a result of UC not keeping up with inflation. 

TUC estimates show that the value of UC has fallen by £12 a month in real terms when measured against CPI inflation and £21 a month when measured against RPI inflation compared to just before the pandemic (February 2020).  

The TUC says this trend will only get worse in the months ahead with inflation forecast to rise further. 

Struggling to cover the basics 

The TUC warns that millions of low-paid families face a crunch point in April when energy bills and national insurance contributions go up – at the same time as UC continues to fall in value. 

New polling – carried out for the union body before last week’s energy cap announcement and Bank of England forecasts – shows that many are already struggling to make ends meet: 

  • One in eight workers (12 per cent) say they will struggle to afford the basics in the next six months. And a fifth of working people (22 per cent) say they’ll struggle to afford more than the basics. 
  • Low-paid workers are more likely to be struggling. One in six (17 per cent) low-paid workers (those earning less than £15,000 a year) say they will struggle to afford basics in the next six months, and three in 10 (29 per cent) say they’ll struggle to afford more than the basics. 

Parents of young children, disabled workers, key workers and BME workers are more likely to be struggling: 

  • Nearly one in five families (18 per cent) with kids under 11 will struggle to afford the basics 
  • Over one in five (21 per cent) disabled workers will struggle to afford the basics, compared to 10 per cent of non-disabled workers 
  • 14 per cent of key workers say they’ll struggle to afford the basics in the next six months, compared to 10 per cent of non-key workers 
  • 14 per cent of BME workers say they’ll struggle to afford the basics in the next six months, compared to 11 per cent of white workers 

The poll also reveals that a fifth of workers (21 per cent) say they have Christmas debts to pay off this year – a number that rises to over a quarter (28 per cent) for workers with children of school age. 

Better support needed 

The TUC says the government must do far more to help struggling households to get through the months ahead. 

The union body says the cost-of-living support announced by the Chancellor on Thursday is “woefully inadequate” and will provide families with just £7 extra a week – most of which will have to be repaid. 

The TUC is also calling for UK Government to use the upcoming spring budget to: 

  • Increase to UC to 80 per cent of the real Living Wage. 
  • Introduce a windfall tax on energy companies, using the money to reduce household energy bills 
  • Boost the minimum wage to least £10 an hour now 
  • Work with unions to get pay rising across the economy 

TUC General Secretary Frances O’Grady said: “Millions of low-paid workers face a perfect storm this April.  

“At the same time as energy prices and national insurance contributions shoot up, universal credit is falling in value. 

“The government must do far more to help struggling families get through the tough times ahead. The support package announced by the Chancellor last week is woefully inadequate. 

“Universal credit urgently needs boosting and we need further action to reduce fuel costs for those battling to make ends meet. 

“Oil and energy companies shouldn’t be making bumper profits, while many struggle to heat their homes. 

“If ministers fail to do what is necessary, more households will be pushed below the breadline.” 

On the need to boost pay, Frances added: “The best way to give working families long-term financial security is to get pay rising across the economy. 

“That means increasing the minimum wage to at least £10 an hour now, and ministers requiring employers to negotiate sector-wide fair pay agreements with unions.” 

Ofgem: Energy price cap to increase by £693 from April

“We know this rise will be extremely worrying for many people, especially those who are struggling to make ends meet”

  • Record increase in global gas prices sees energy price cap rise of 54%
  • Ofgem knows this rise will be extremely worrying for many people
  • Customers struggling to pay their energy bill should contact their supplier to access the help available

The energy price cap will increase from 1 April for approximately 22 million customers. Those on default tariffs paying by direct debit will see an increase of £693 from £1,277 to £1,971 per year (difference due to rounding). Prepayment customers will see an increase of £708 from £1,309 to £2,017. 

The increase is driven by a record rise in global gas prices over the last 6 months, with wholesale prices quadrupling in the last year.

It will affect default tariff customers who haven’t switched to a fixed deal and those who remain with their new supplier after their previous supplier exited the market.

The price cap is updated twice a year and tracks wholesale energy and other costs.

It stops energy companies from making excessive profits, ensuring customers pay no more than a fair price for their energy.

The price cap allows energy companies to pass on all reasonable costs to customers, including increases in the cost of buying gas.

Since the price cap was last updated in August, the current level does not reflect the unprecedented record rise in gas prices which has since taken place.

Under the price cap mechanism, energy companies will be allowed to pass on these higher costs from April when the new level takes effect.

This is because energy companies cannot afford to supply electricity and gas to their customers for less than they have paid for it.

Over the last year, 29 energy companies have exited the market or been put in special administration in the wake of soaring global gas prices, affecting around 4.3 million domestic customers.

Jonathan Brearley, chief executive of Ofgem, said: “We know this rise will be extremely worrying for many people, especially those who are struggling to make ends meet, and Ofgem will ensure energy companies support their customers in any way they can.

“The energy market has faced a huge challenge due to the unprecedented increase in global gas prices, a once in a 30-year event, and Ofgem’s role as energy regulator is to ensure that, under the price cap, energy companies can only charge a fair price based on the true cost of supplying electricity and gas. 

“Ofgem is working to stabilise the market and over the longer term to diversify our sources of energy which will help protect customers from similar price shocks in the future.”

Ofgem will tomorrow announce further measures to help the energy market weather future volatility by increasing financial resilience and have the flexibility to respond so that risks are not inappropriately passed on to consumers.

This follows measures announced in December.

The further measures include enabling Ofgem to update the price cap more frequently than once every 6 months in exceptional circumstances to ensure that it still reflects the true cost of supplying energy.

Help available for customers:

  • If customers are struggling to pay for energy bills, they should contact their energy supplier as soon as possible. Depending on their circumstances, customers may be eligible for extra help with their energy bills or services, such as debt repayment plans, payment breaks, emergency credit for prepayment metered customers, priority support and schemes like the Winter Fuel Payment or Warm Home Discount rebate.
  • Breathing Space Scheme: This is a scheme to give households time to receive debt advice and find a solution to sort out their debt problems. Breathing space will last for 60 days as long as applicants remain eligible during which time all creditors who have been included will be informed and must stop any collection or enforcement activity. Once the breathing space ends, creditors will be able to collect the debt in the usual way. Call the National Debtline on Freephone 0808 808 4000 or visit www.nationaldebtline.org
  • The Citizens Advice consumer service can provide advice on how customers can resolve problems with their energy provider. You can contact Citizens Advice via webchat, or by calling 0808 223 1133. For complex or urgent cases, or if a person is in a vulnerable situation, they may then be referred onto the Extra Help Unit. 

2. Ofgem will announce further measures tomorrow including:

  • Introducing an uplift in the wholesale cost allowance in the price cap: after reviewing the evidence, Ofgem has decided that the existing price cap methodology did not appropriately account for the additional wholesale energy costs energy companies have incurred during the current price cap period following the unprecedented scale of wholesale energy prices and volatility. This adjustment represents less than 10% of the overall price cap increase.
  • Changing licence conditions to give Ofgem the more flexibility to change the price cap level if needed in between the regular six-monthly cap updates: Ofgem has set ourselves five tests which mean we will only expect to use the power in exceptional circumstances.
  • Further reforms to the price cap from October: In December we set out three options to make the price cap more robust to high and volatile wholesale energy costs while preserving as far as possible the benefits of the price cap for consumers. The consultation published tomorrow will include all three options, with quarterly updates as our preferred option

Breakdown of costs in the energy price cap

Dual fuel customer paying by direct debit, typical energy use (GB £)

Dual fuel customer paying by direct debit, typical energy use

*Network costs: The main driver of this increase is the recovery of Supplier of Last Resort (SoLR) levy costs (£68). A supplier acting as a SoLR can make a claim for any reasonable additional, otherwise unrecoverable, costs they incur. These levy claims are paid to energy companies by the distribution network companies and recovered from consumers via their charges.

5. The charts below show the wholesale prices that are used to determine the wholesale cost allowance within the price cap from spring 2018 ahead of the introduction of the price cap in January 2019.

Wholesale costs make up the majority of a customer’s bill. An efficient supplier will purchase energy for their customers on the wholesale market in advance of when they need to supply that energy.

This purchasing strategy is reflected in how the wholesale allowance is calculated within the price cap. We observe the forward-looking energy contracts that energy companies typically purchase over time and combine these to determine the wholesale cost allowance within the price cap.

We do this twice a year when we update the price cap in August for the winter period (October – March) and in February for the summer period (April – September) based on the price of these forward-looking energy contracts over the previous six months.

The fixed horizontal line shows the average wholesale cost allowance for each 6 month price cap period based on the price of the relevant forward looking energy contracts (the jagged line).

The recent spike in the prices of relevant forward looking energy contracts over the last 6 months can be clearly seen. The scale and pace of wholesale price increases has resulted in a big increase in the wholesale cost allowance for the price cap level for summer 2022.

Wholesale gas price costs in the energy price cap

Pence per therm

Wholesale gas price costs in the energy price cap

Wholesale electricity price costs in the energy price cap

Pounds per megawatt hour

Wholesale electricity price costs in the energy price cap

Data sets behind these graphs are proprietary and can be sourced from ICIS.

Chancellor’s statement – Energy Price Cap

Statement, as delivered by Chancellor Rishi Sunak, on 3 February 2022:

Mr Speaker,

The UK’s economic recovery has been quicker and stronger than forecast.

In the depths of the pandemic, our economy was expected to return to its pre-crisis level at the end of 2022.

Instead, it got there in November 2021 – a full year earlier.

Unemployment was expected to peak at nearly 12%.

Instead, it peaked at 5.2% and has now fallen to just over 4% – saving more than 2 million jobs.

And with the fastest growing economy in the G7 this year…

Over 400,000 more people on payrolls than before the pandemic…

And business investment rising…it’s no wonder Mr Speaker, that borrowing is set to fall from £320bn last year …

… the highest ever peacetime level …

… to £46bn by the end of this Parliament.

As we emerge from the depths of the worst recession in 300 years, we should be proud of our economic record.

The economy is stronger because of the plan we put in place; because of the actions we took to protect families and businesses.

And that plan is working.

But for all the progress we are making – the job is not yet done.

Right now, I know the number one issue on people’s minds is the rising cost of living.

It is the independent Bank of England’s role to deliver low and stable inflation – and the Governor will set out their latest judgements at midday today.

And just as the government stood behind the British people through the pandemic…

… so we will help people deal with one of the biggest costs they now face – energy.

The energy regulator, OFGEM, announced this morning that the energy price cap will rise in April to £1,971 – an increase of £693 for the average household. Without government action, this would be incredibly tough for millions of hardworking families. So the government is going to step in to directly help people manage those extra costs.

Mr Speaker,

Before I set out the steps we are taking, let me explain what’s happening to energy prices, and why.

People’s energy bills are rising because it is more expensive for the companies who supply our energy to buy oil, coal, and gas.

Of the £693 increase in the April price cap, around 80% comes from wholesale energy prices.

Over the last year, the price of gas alone has quadrupled.

And because over 85% of homes in Britain are heated with a gas boiler, and around 40% of our electricity comes from gas, this is hitting households hard.

The reasons gas prices are soaring are global.

Across Europe and Asia, a long, cold winter last year depleted gas stores.

Disruption to other energy sources like nuclear and wind left us relying more than usual on gas during the summer months.

Surging demand in the world’s manufacturing centres in Asia…

… at the same time as countries like China are moving away from coal…

… is further increasing demand for gas.

And concerns about a possible Russian incursion into Ukraine are putting further pressure on wholesale gas markets.

And so prices are rising.

Mr Speaker,

The price cap has meant that the impact of soaring gas prices has so far fallen mainly on energy companies.

So much so, that some suppliers who couldn’t afford to meet those extra costs have gone out of business as a result.

It is not sustainable to keep holding the price of energy artificially low.

For me to stand here and pretend we don’t have to adjust to paying higher prices would be wrong and dishonest. But what we can do is take the sting out of a significant price shock for millions of families … by making sure the increase in prices is smaller initially and spread over a longer period.

Mr Speaker,

Without government intervention, the increase in the price cap would leave the average household having to find an extra £693.

The actions I’m announcing today will provide, to the vast majority of households, just over half that amount – £350.

In total, the government is going to help around 28 million households this year.

Taken together, this is a plan to help with the cost of living worth around £9bn.

We’re delivering that support in three different ways.

First, we will spread the worst of the extra costs of this year’s energy price shock over time.

This year, all domestic electricity customers will receive an upfront discount on their bills worth £200.

Energy suppliers will apply the discount on people’s bills from October.

With the government meeting the cost in full.

That discount will be automatically repaid from people’s bills in equal £40 instalments over the next five years.

This is the right way to support people while staying on track with our plans to repair the public finances.

And because we are taking a fiscally responsible approach, we can also provide more help, faster, to those who need it most – the second part of our plan.

We’re going to give people a £150 Council Tax rebate to help with the cost of energy, in April – and this discount won’t need to be repaid.

And I do want to be clear with the House that we are deliberately not just giving support to people on benefits.

Lots of people on middle incomes are struggling right now, too – so I’ve decided to provide the council tax rebate to households in Bands A to D.

This means around 80% of all homes in England will benefit.

And the third part of our plan will provide local authorities with a discretionary fund of nearly £150m…

… to help those lower income households who happen to live in higher Council Tax properties…

… and households in bands A-D who are exempt from Council Tax.

We’re also confirming today that we’ll go ahead with existing plans to expand eligibility for the Warm Home Discount by almost a third…

… so that 3m vulnerable households will now benefit from that scheme.

And that’s not all we’re doing to help vulnerable households.

We’re providing £3bn over this Parliament to help more than half a million lower income homes become more energy efficient, saving them on average £290 per year.

Increasing the National Living Wage to £9.50 an hour in April, a pay rise of over £1,000 for 2 million low paid workers.

And providing an effective tax cut for those on Universal Credit, allowing almost 2 million households to keep an average of £1,000 per year.

The payment through energy suppliers will apply across England, Wales and Scotland.

Energy policy is devolved in Northern Ireland, with a different regulator, and the government does not have the legal powers to intervene.

So we will make sure the Executive is funded to do something similar, with around £150m for Northern Ireland through the Barnett formula next year.

And because the Council Tax system is England only, total Barnett consequentials of around £565m will be provided to the devolved administrations in the usual way.

Mr Speaker,

I know that some in this House have argued for a VAT cut on energy.

However, that policy would disproportionately benefit wealthier households.

There would also be no guarantee that suppliers would pass on the discounts to all customers.

And we should be honest with ourselves: this would become a permanent Government subsidy on everyone’s bills.

A permanent subsidy worth £2.5 billion every year – at a time when we are trying to rebuild the public finances.

Instead, our plan allows us to provide more generous support, faster, to those who need it most, providing 28m households with at least £200, and the vast majority receiving £350.

It is fair, it is targeted, it is proportionate – it is the right way to help people with the spike in energy costs.

Mr Speaker,

Today’s announcements are just one part of the government’s plan to tackle this country’s most pressing economic challenges.

A plan for growth – with record investments in infrastructure, innovation and skills.

A plan to restore the public finances – with debt falling by the end of this Parliament.

A plan to cut waiting lists and back the NHS with £29bn over three years and a permanent new source of funding.

And, with the measures I’ve announced today – a plan to help with the rising cost of energy with £350 more in the pockets of tens of millions of hard working families.

That’s our plan to build a stronger economy – not just today but for the long term.

And I commend it to this House.

Commenting on the energy cap rise, interest rate rise and the Chancellor’s measures to address the cost of living crisis, TUC General Secretary Frances O’Grady said: “The Chancellor’s announcement is hopelessly inadequate. For most families it’s just £7 a week and more than half must be paid back.

“It’s too little, it’s poorly targeted, and it’s stop gap measures instead of fixing the big problems.

“Britain needs a pay rise. The best way to help families is to get wages growing again. But this government has no plan to end pay misery.

“Ministers should be getting urgent help to families that need it most through raising universal credit. And we need a windfall tax on the excessive profits from North Sea gas to cut bills and boost investment in affordable energy.”

Responding to today’s announcements on energy costs and the cost of living, Katie Schmuecker, Deputy Director of Policy and Partnerships for the independent Joseph Rowntree Foundation said:  “The Chancellor has offered cold comfort to families in poverty, who are already rationing what they can spend on essentials such as heating and food.

“These families are now expected to find at least half of the eye watering increases in energy bills, when many are already getting into debt to keep their houses warm and food on the table.  

“Three quarters of those who can claim the enhanced support are not in poverty. Meanwhile inflation is set to rise at more than double the rate of benefits. This support will not get people through the next few months and it will not protect those most at risk of hardship. 

“People in poverty are hit hardest by all these pressures because our social security system is simply not offering adequate support, and until that changes they will continue to be exposed to every economic shock. 

“The Chancellor has made his choice, the harder choices will now be coming for those who still can’t afford essentials for themselves and their families.”

 University of Birmingham’s Harriet Thomson on the rise of energy price caps: “This news comes at a time when families across Great Britain have already been facing years of rapidly increasing energy prices, as well as chaotic energy market conditions with the collapse of around 20 energy supplies since January 2021 alone.

“Just last month, ONS data found that 2 in 3 adults said their costs of living had gone up in the past month, with 79% of those attributing blame to gas and electricity prices.

“We know from the extensive body of existing evidence on this topic that lower income households will be disproportionately hit by the price cap increase, risking pushing millions more into a situation fuel poverty.

“This will have serious consequences for physical and mental health, social isolation, and educational attainment, with households forced to make difficult everyday decisions over whether to ‘heat or eat’.  

“Moreover, these price increases are likely to push more people into using risky and/or polluting alternative energy sources, such as DIY candle heaters that have been linked to house fires, burning scrap wood and other flammable materials, and digging up peat. As well as the obvious risks to human life, these approaches will also exacerbate climate change.

“It’s clear that energy companies are reeling from the potent combination of cash flow reductions due to pandemic-related economic pressures on families who are building up more energy debt, and the global gas crisis.

“But the answer is not to burden households with yet more costs. The energy market is broken and needs radical reform – now is the time for the UK government to show ambition and commitment to the nation by investing in deep retrofits of our old and leaky housing stock, and to rollout decentralised renewable energy systems at scale.”

Gove: Levelling Up invitation to ‘join forces for the common good’

The Secretary of State for Levelling Up Michael Gove has written to the First Ministers of Scotland, Wales and Northern Ireland following the publication of the Levelling Up White Paper.

In the letters the Secretary of State for Levelling Up:

  • discusses the publication of the Levelling Up White Paper
  • calls for the First Ministers of Scotland, Wales and Northern Ireland to work with the UK government to overcome shared challenges

The Scottish Government is yet to respond.

LEVELLING UP: REACTION

Responding to the publication of the levelling up white paper, TUC General Secretary Frances O’Grady said: “If we don’t level up at work, we won’t level up the country. 

“But the government has failed to provide a serious plan to deliver decent well-paid jobs, in the parts of the UK that need them most. 

“Insecure work and low pay are rife in modern Britain. And for far too many families hard work no longer pays.  

“With the country facing a cost-of-living crisis, working families need action now to improve jobs and boost pay packets – especially after more than a decade of lost pay.  

“Ministers should have announced a plan to get real wages rising – starting with a proper pay rise for all our key workers and the introduction of fair pay deals for low-paid industries. 

“And they should have delivered the long-awaited employment bill to ban zero hours contracts – as well as new, meaningful investment in skills and good green jobs of the future. 

“Without a plan to deliver decent work up and down the country, millions will struggle on, on low wages, and with poor health and prospects.” 

Recent polling published by the TUC found the British public’s number one priority for levelling up is more and better jobs.  

The TUC polling, conducted by YouGov, reveals that the most popular priority for levelling up, chosen by one in two Britons, is increasing the number and quality of jobs available.   

Increasing the number and quality of jobs is popular across the political spectrum. Half (49 per cent) of those who voted Conservative in the 2019 general election picked it as their top priority, along with more than half of Labour voters (56 per cent) and Lib Dem voters (54 per cent). 

Matthew Fell, CBI Chief Policy Director, said: “The Levelling Up White Paper is a serious assessment of the regional inequalities which have hamstrung the UK’s economic potential for generations.

“It offers a blueprint for how government can be rewired and an encouraging basis for how the private sector can bring the investment and innovation to start overcoming those deep-rooted challenges, and power long term prosperity for every community, wherever they live.

“The picture it paints of a reinvigorated 2030 UK can inspire public and private sector partners to unite on shared missions for improving health, wealth, growth and opportunity across the country.

“Crucially, it accepts the CBI view that business-driven economic clusters – enabling every region and nation to build its own unique competitiveness proposition – can be a catalyst which brings levelling up ambitions to life.”

University of Birmingham’s John Bryson on the Levelling Up announcement: “The UK has always suffered from uneven development and this is reflected in all measures of well-being – from salaries to place-based differences in mortality rates and morbidity.

“There is no country on this planet that does not suffer from some form of uneven place-based outcomes. The implication is that any attempt to remove place-based uneven outcomes will and must fail. The policy outcome might mean some alteration in the extent or degree of unevenness, but unevenness will continue to persist.

“No political party will be able to develop effective solutions to create a level playing field. Nevertheless, this does not mean that policies should not be designed to support and facilitate some form of more even development. However, the outcome will still be the persistence of uneven outcomes.  

“The key to any levelling-up agenda is to accept that every place is different and that there are multiple alternative place-based pathways; London can never become Newcastle and Newcastle can never become London.

“The levelling-up agenda needs to be positioned around a debate that is not based on closing the gap between the richer and poorer part of the country, but instead must be framed around facilitating place-based responsible inclusive prosperity.

“This must be the focus as any policy targeted at economic growth can never be sustainable. The levelling-up policy initiative ultimately must be designed to encourage inclusive carbon-light lifestyles. One implication is that levelling-up might also require some degree of levelling-down.” 

Campbell Robb, Nacro chief executive said: “We know tackling poverty and inequality is key to levelling up. For over 50 years Nacro has been embedded in communities helping some of our nation’s most vulnerable people through our housing, education, and justice services.

“We see a huge amount of unmet need in our country. We need radical change to the systems that support people and significant funding to address this need, not just ambitions and slogans.

“Until there is right support, opportunity, and funding in place for everyone to succeed regardless of the circumstances, we cannot truly claim to be levelling up”

Torsten Bell, Chief Executive of the Resolution Foundation, said: “We now know what levelling up is – George Osborne plus New Labour.

“The White Paper is all about combining the devolution of the former Conservative Chancellor, with the bigger and more activist state focused on deprived areas of the last Labour government.

“There is a strong case for both. Whether they can be delivered very much remains to be seen.”

Responding to the publication of Government’s Levelling Up the United Kingdom White Paper, Social Mobility Commission Chair Katharine Birbalsingh and Deputy Chair Alun Francis said: “We welcome the publication of the Levelling Up White Paper, and the fact that it gives a clear framework to address disparities between regions and communities.

“These communities are full of talented individuals and we must do everything we can to empower them to thrive. Each of the missions the paper sets out are hugely important, and it is crucial that checks and balances are in place to ensure that local government bodies, both existing and new, are held to account for their delivery.

“The Commission has been clear that social mobility must be a core objective of levelling up. We are pleased to see that equipping young people with the tools they need to succeed in life is at the heart of this strategy, and that it includes measures that can contribute to social mobility through every stage of a young person’s journey, from early childhood through education, training and employment.

“The missions are aspirational and pose the right questions, but are also hugely ambitious. The test will be in the detail and the implementation – not just boosting skills, but which skills will be taught and how; not just aiming for essential literacy and numeracy, but defining the most effective ways to achieve them.

“Ultimately, levelling up will be judged on how well it creates opportunities in places they did not exist before. A key test will be how we help those with the fewest opportunities find decent work – this is not just about stories of rags-to-riches. More still needs to be done to stimulate the creation of much-needed quality private sector jobs in the most deprived areas.

“As the Social Mobility Commission we stand ready to work with the government to flesh out that detail, advise on the best ways to make these missions a reality, and ensure that levelling up empowers people up and down the country to stand on their own two feet.”

Finally, after months of delays, the levelling up White Paper is out! So was it worth the wait?

Levelling Up White Paper leaves low paid workers behind

As the TUC has argued, you can’t level up without levelling up at work. In-work poverty, driven by the prevalence of low-paid and insecure work, is sky-high in every region and nation of the UK. This reflects the fact that low-paid sectors, such as retail and social care, are major employers in every area of the country (writes TUC’s JANET WILLIAMSON).

And more and better jobs is the public’s top priority for levelling up, with recent polling for the TUC conducted by YouGov finding that increasing the number and quality of jobs is seen as a priority for levelling up by one in two people from right across the political spectrum. Does the White Paper deliver this?

The White Paper sets out 12 missions – or aims – spanning living standards, R&D, transport, digital connectivity, education, skills, health, well-being, pride in place, housing, crime and local leadership. There is not a specific mission on work, but the living standards mission is “By 2030, pay, employment and productivity will have risen in every area of the UK, with each containing a globally competitive city, and the gap between the top performing and other areas closing.”

So, what is the plan for achieving this?

In a nutshell, it is to grow the private sector and improve its ability to create new and better paid jobs. There are five strategies to support this aim, all of which fall under a typical ‘industrial strategy’ umbrella: improving SME’s access to finance; boosting institutional investment, including from the Local Government Pension Scheme (LGPS) and the recently established National Infrastructure Bank; attracting foreign direct investment and using trade policy, in particular freeports, to boost investment; improving the diffusion of technologies and innovation; and supporting and growing the manufacturing sector.

There are some important questions to be answered in relation to some of these strategies; for example, it is vital that the LGPS is invested in the long-term interests of its members, without its funds being diverted towards other purposes. And each deserves proper examination in its own right.

But what they have in common is that all of them aim to create a better distribution of well-paid and highly skilled jobs around the country. This is needed – but what about the jobs that people are already in? There is no plan to address inequality within the labour market and nothing to level up work that is low paid and insecure.

The experience of London shows that the prevalence of high-paid jobs does not automatically lead to rising incomes for the wider community. Indeed, London has the highest rate of in-work poverty in the country, with people in low-paying service sector jobs priced out of housing and local amenities.

To level up, we must tackle low pay and insecurity head on, and focus on those sectors that need it most.

We need to strengthen the floor of employment protection for all workers by raising the minimum wage and tackling zero hours contracts. And the government should lead by example, giving public sector workers a proper pay rise and reversing the devastating cuts that public services have suffered in the last decade. Decent jobs should be a requirement of all government procurement, so that the power of government is used to drive up employment standards.

But we also need to change the way our economy works to hardwire decent work into business models and economic growth. Relying on the private sector to level up without changing how it works will fail. We need corporate governance reform to rebalance corporate priorities and give working people a fair share of the wealth they create. And we need a new skills settlement to give working people access to lifelong learning accounts and a right to retrain.

Levelling up at work means addressing the imbalance of power in the workplace

Working people need stronger rights to organise collectively in unions and bargain with their employer. Collective bargaining promotes higher pay, better training, safer and more flexible workplaces and greater equality – exactly what we need to level up at work. Unions should have access to workplaces to tell people about the benefits of unions, following the New Zealand model.

And to level up we must tackle entrenched low pay and poor conditions within sectors head on, bringing unions and employers together to set sectoral Fair Pay Agreements for low paid sectors, starting with social care.

Creating new and better jobs is important; but this Levelling Up White Paper has left those in low paid, insecure work behind.

Covid: Ventilation at work

Workplace advice from the TUC

We know that Covid is an airborne virus, meaning it is primarily spread through the air in tiny particles, known as aerosols. Aerosols are different to droplets, which are larger and can be spread from touching surfaces; they are breathed out by a person. That means anyone can spread them, unknowingly: you don’t need to be coughing or sneezing.

Aerosols are small, they can remain suspended in the air for hours. So if you’ve entered a room where someone who is infectious but not showing symptoms has been, even if they have already left, you might still breathe in a Covid-19 aerosol.  

 A combination of concentration, airflow, humidity and temperature, all contribute to whether the aerosol load will be infectious.  

This means ventilation, where we make sure the air is renewed and refreshed regularly, is an incredibly important method for reducing Covid transmission. 

Every workplace risk assessment should include aerosol transmission, and outline what steps are being taken to improve ventilation where necessary. 

Despite ventilation being one of the most effective ways to mitigate risk, union safety reps have told the TUC that it’s the one employers are least likely to be paying attention to. In some cases, we need to force ventilation onto the agenda through union education and action. 

CO2 monitors 
 
More employers are purchasing CO2 monitors, and some unions are making use of them to carry out safety inspections. These devices monitor how much CO2, which is breathed out by people, is in the air in a given space. The higher the level of CO2 is, the more poorly a space is ventilated. A CO2 monitor can’t tell you if you’re breathing in Covid, but it will tell you if you’re breathing in other peoples’ breath. The higher the reading, the more likely exposure will be. 

A key threshold to be aware of is 800 parts per million (ppm): if a CO2 monitor is consistently showing a room as reading above 800ppm, action must be taken to improve ventilation, or the area should be taken out of use.  

When using CO2 monitors, remember to:

  • Take the reading in the most poorly ventilated area of the room, for example do not take the reading next to an open window.  
  • Make a plan to consistently monitor, to improve accuracy and give a better picture for how the air quality is changing: taking readings throughout the day, or week, or adjusting frequency depending on how the space is being used.  

You can find more information on using CO2 monitors from the Health and Safety Executive. 

Improving ventilation

Your CO2 monitor doesn’t improve ventilation, it only gives you an accurate picture of whether you need to make improvements, and by how much. Further action that may need to  be taken can include: reducing the occupancy in a given indoor space, opening windows and doors, and using equipment which can be purchased, such as local air filtration units. 

Ventilation and air conditioning systems can help, but only those which do not recirculate air: any systems which recirculate air around a room or building must be switched off, as these risk spreading aerosols further, rather than filtering them with fresh air supply. Similarly, it’s worth noting that a desk fan which you might have on during hot weather is going to blow air from one part of a room to another: while it might keep you cool, it risks aiding aerosol spread. 

Windows 

The easiest way to boost the fresh air supply in an indoor space is to keep windows or doors open. 

In some workplaces, opening a window will not be an option. With outside air comes other risks: cold temperatures, pollution, or contamination. In some cases, opening windows is simply not an option, for example in a maternity ward, a food factory, or where there are none. This is not a get-out for employers: they must be taking every effort to provide effective ventilation by other means. 

Air filtering units 

Where existing methods to improve ventilation are not to a safe standard, employers should be purchasing and providing air cleaning and filtering units. These are relatively cheap and highly effective in removing airborne virus from indoor room air.   

There are minimum specifications, including the requirement for HEPA (high efficiency particulate absorbing) filters, which remove up to 99% of aerosols. The number of filters required will depend on the size of a workspace. Six ACH (air changes per hour) is considered a safe level of ventilation, and can be achieved by a combination of methods. It is important to bear in mind, CO2 monitoring where air filters are being used will not give an accurate reading of air quality: this is because filtering units will remove virus aerosols, but not CO2 from the air.

Face coverings and face masks 

Wearing a face covering will reduce, but cannot eliminate, your risk of infection. 

This means mitigations such as mask-wearing (in particular, respirator masks at a FFP2 or FFP3 standard, which are effective for aerosol as well as droplet spread) are all the more important; along with effective ventilation. Keeping a good supply of fresh in indoor spaces can make a big difference in diffusing any potential Covid aerosols. Face masks are not a replacement for good ventilation: where possible, both are preferable.

Actions unions are taking include: 

  • Adopting a union position and demands to the employer, based on the situation in your workplace and the steps required to bring ventilation to a safe level.  
  • Safety reps carrying out inspections of indoor workspaces using CO2 monitors. 
  • Issuing a union improvement notice, or emergency advice including removing oneself from the hazardous environment if serious risk presents.  
  • Utilising union representation on any safety committees to raise the issue, and consultation in risk assessment process. 
  • Holding union member-wide meetings on the subject of ventilation, explaining the problem to members, and deciding on next steps including collective action to force changes to keep workers safe, and escalating matters through formal dispute procedures. 

See further resources:  

With thanks to Doctor Jonathan Fluxman for information for this blog. See https://www.docjon.org/  

Real Living Wage increases to £9.90 as cost of living rises

  • Over 300,000 Living Wage workers are set for a pay boost  
  • More than £1.6 billion in extra wages has gone to low-paid workers since the start of the Living Wage movement 20 years ago 
  • £613 million in extra wages has gone to low-paid workers since the start of lockdown, with a record number of employers signing up – over 3,000 since the pandemic began  
  • Greater London Authority and Greater Manchester Combined Authority are today making announcements on their progress to becoming Living Wage City Regions 
  • Despite these successes, 4.8 million employees (1 in 6 workers) are still paid below the Living Wage, with those from racialised groups1 more likely to be paid below the Living Wage than white workers (19.4% compared to 16.3%).  

Over 300,000 people working for almost 9,000 real Living Wage Employers throughout the country are set for a vital pay boost as the new Living Wage rates rise to £9.90 across the UK (40p increase), and £11.05 in London (20p increase), supporting workers and families.

The Living Wage rates are the only rates independently calculated based on what people need to live on.

This year the movement for a real Living Wage celebrates its twentieth year, with new research from the Cardiff Business School showing Living Wage workers have benefitted from more than £1.6bn in extra wages during this period. One in 13 workers now work for an accredited Living Wage Employer.  

The new Living Wage rates and the ‘National Living Wage’: know the difference 

Unlike the Government minimum wage (‘National Living Wage’ for over 23s – £8.91 rising to £9.50 in April) the real Living Wage is the only wage rate independently calculated based on rising living costs – including fuel, energy, rent and food.

A full-time worker earning the new, real Living Wage would earn £1,930 a year more than a worker earning the current government minimum (NLW). For a worker today that’s the equivalent of 7 months of food bills and more than 5 months’ rent based on average household spending in the UK.

Even on next April’s higher NLW rate of £9.50, a full-time worker on the real Living Wage would earn £780 more. 

In London, a full-time worker on the new real Living Wage rate would earn an additional £4,173 a year compared to a worker on the current NLW and £3,022 more than a worker on next year’s National Living Wage.  

The increase in Living Wage rates this year has largely been driven by rising fuel and rent costs.

The Living Wage movement continues to grow 

Major new Living Wage employers announced today include FTSE 100 construction firms Taylor Wimpey and Persimmon Homes, Fujitsu, food delivery company Getir, and Capita. They join half of the FTSE 100 companies, household names like Aviva, Everton FC, Burberry and Lush as well as thousands of small businesses, who are choosing to pay the real Living Wage to ensure all staff earn a wage that meets the real cost of living. More than 3,000 employers have now accredited with the Living Wage Foundation since the start of the pandemic. 

Metro Mayors in London and Greater Manchester have also today announced major new commitments to create Living Wage City Regions which could see thousands more pay rises.  

Looking globally, the Living Wage campaign also today launches Living Wage for US, the first coordinated national effort set up to ensure that workers across the United States are paid a real Living Wage. 

Low pay in the UK  

The announcement of the new rates comes as new research by the Living Wage Foundation has demonstrated the scale of low pay during the pandemic, with 4.8 million jobs (17.1% of employee jobs) still paying less than the real Living Wage.

Northern Ireland had the highest proportion of jobs paying below the Living Wage (21.3% or 236,000) and the South East the lowest (12.8% or 533,000). [4] 

Those from racialised groups were more likely to be low paid – with 19.4% of these workers earning below the LW compared to 16.3% of white workers.


Katherine Chapman, Living Wage Foundation Director, said: “With living costs rising so rapidly, today’s new Living Wage rates will provide hundreds of thousands of workers and their families with greater security and stability.  

“For the past 20 years the Living Wage movement has shaped the debate on low pay, showing what is possible when responsible employers step up and provide a wage that delivers dignity. 

“Despite this, there are still millions trapped in working poverty, struggling to keep their heads above water – and these are people working in jobs that kept society going during the pandemic like social care workers and cleaners. 

“We know that the Living Wage is good for businesses as well as workers, and as we rebuild our economy post pandemic, the real Living Wage must be at its heart.” 

The Archbishop of York, the Most Revd Stephen Cottrell, said: “This Living Wage Week, the Living Wage Foundation has announced the new rates that cover what we all need to earn to get by.

“Their movement will see over 9,000 businesses elect to give their 300,000 workers not only what they need to survive, but to thrive as well.

“The principle behind the campaign for better pay and secure working conditions ought to be a pillar of our new society, and one I hope will be adopted by even more forward-thinking businesses as we look ahead to 2022.” 

Sarah Wadsworth, Fujitsu UK HR Director, said: “I am delighted that Fujitsu have signed as a Real Living Wage employer. This long-term commitment is not only the right thing to do for our employees but also ensures that our suppliers and partners are also planning to align to this for their employees.

“Fair pay for all employees continues to be relevant for our business as well as the benefits it brings to wider communities.” 

Anne Billson-Ross, Taylor Wimpey Group HR Director, said: “This voluntary commitment is a fantastic example of the direct action we are taking to ensure we remain an employer of choice, committed to do the right thing by our employees, suppliers and subcontractors.” 

Dean Finch, Group Chief Executive of Persimmon Homes, said: “I want all our employees to feel valued and fairly paid for the good work that they do. Paying the real Living Wage is an excellent way of demonstrating this. I am therefore delighted we have become a Living Wage Foundation accredited employer and joined what is an important campaign.”  

Kim Coles, Finance Director at Lush, said: “At Lush we are committed to a fair wage at all levels of the business and fully support the UK Living Wage Foundation’s approach of a hard day’s work deserving a fair day’s pay.

“We have been paying the London Living Wage since 2011 and paying all UK staff at or above the “real” hourly Living Wage rate since April 2017. We continue to commit to the rate in tough times because that is when our people need it the most, and it’s the right thing to do.

“Lush staff are crucial to our success, and they work incredibly hard making and selling our products. Having an independently calculated real living wage rate means that we have a positive step towards staff being able to afford what they need to thrive, not just survive.

“It also means that the same fair trade commitment we make to our ingredient suppliers is made to our staff and that we can be confident their rates of pay are fair and increase in line with real living costs.”   

Turancan Salur, General Manager at Getir, said: “At Getir we pride ourselves on being a great employer. As well as paying all our colleagues at least the real Living Wage, with the opportunity to earn more through bonuses, we provide pensions, sick pay, paid leave, insurance and all PPE and electric delivery vehicles. 

“It is only right and fair that we do this as our workforce is the most important part of our business and we fully support the Living Wage Foundation for promoting such an important issue.”    

Ryan, a Living Wage worker at COOK Food, said: “Before joining COOK I’d worked in a pub for two years. I was on minimum wage and I was working at least 50 hours a week to pay the rent. Even though I was working so hard, I started to get in debt. My relationships suffered, and it started to affect my health both mentally and physically. 

“However, since coming to COOK, being paid the real Living Wage made all the difference. I could work only 40 hours a week and take home more than when I was working 50 or 60 hours at the pub. 

“Gradually my mental health improved, and I also started to live more healthily. I lost 30kg because I actually had the time and money to make real food, eat properly and exercise. My relationships improved as I had time to spend with my friends and made new friends at COOK, too.” 

Commenting on the Living Wage Foundation figures which show that one in six workers are earning under the real Living Wage, TUC General Secretary Frances O’Grady said: “Every worker should be able to afford a decent standard of living.  

“But these new figures from the Living Wage Foundation show that low pay is endemic in modern Britain. Millions are in jobs that don’t pay the bills or put food on the table. 

“After eleven years of Conservative government, real wages are only just getting back to their 2009 level. And the Budget revealed we face another half decade of wage stagnation.  

“With Britain in the middle of a cost-of-living crunch, it’s time for the government to act. 

“Ministers must start by increasing the minimum wage to £10 immediately, banning zero hours contracts and giving trade unions greater access to workplaces to negotiate improved pay and conditions.  

“That‘s how we get wages rising for everyone.” 

TUC calls on Clarks shoes CEO to end ‘fire and rehire’ dispute

  • Call comes ahead of protests in Clarks Village today (Saturday)
  • TUC says Johnny Chen should urgently get around the table with union representing striking workers

The TUC has called on the new CEO of Clarks Shoes Johnny Chen to “get around the table” with union leaders and end the dispute over the company’s controversial use of ‘fire and rehire’ tactics.

The TUC says Johnny Chen should meet urgently with the general secretary of Community Roy Rickhuss to come to a fair agreement.

The call comes ahead of protests today (Saturday). Workers currently on strike, their families and their supporters will march through the iconic Clarks Village to protest the usage of fire-and-rehire by Clarks and ask them to reconsider.

Members of Community union – working at Clarks warehouse in Street, Somerset –have been on strike since October 4th after the company threatened to dismiss them and rehire them on worse terms.

TUC General Secretary Frances O’Grady said: “Nobody wants to see this dispute drag on – least of all Clarks’ workers.

“We urge the new CEO to urgently get around the table with the general secretary of Community and come to a fair agreement.”

TUC Deputy General Secretary Paul Nowak, who will join the march and protest in Clarks Village today, said: “Generations of families have worked for and contributed to the success of Clarks shoes. All they want is for is staff to be treated with dignity at work.

“A company with Clarks’ proud tradition and history should not be using ‘fire and rehire’ tactics to drive down pay and conditions.”

Community General Secretary Roy Rickhuss said: “Over the past month, workers at Clarks have been overwhelmed by the outpouring support that people from across the country have given them. Fire-and-rehire is cruel and wrong, and everyone is aware of this. Sadly, this has led to no progress with Clarks and their plans will be continuing.

“Clarks is a staple brand on the British high street, with a history dating back over a century. Their roots in their local community go even deeper. There once was a time where Clarks built schools, libraries and theatres for their workers and their families in Somerset. This is a betrayal of their roots, and everything Clarks once stood for.

“We are protesting on Saturday to send a message to Clarks that we stand strong and we will resist these changes at every turn. We do not want to be on strike, and we do not want to be protesting. We urge Clarks to call off the diminishing of terms and conditions and reconsider this move. We remain ready and waiting for productive discussions on how we can succeed together going forward when they are.”

Disabled workers ‘hit hardest’ by Covid-19

  • New poll finds disabled workers have been “hit hardest” in the wallet by Covid-19 and have faced financial hardship, increased debt and have been forced to use food banks 
  • Accompanying new TUC analysis finds non-disabled workers are now paid 16.5 per cent more a year than non-disabled workers 
  • And disability charity Leonard Cheshire highlights discrimination against disabled workers, with 1 in 5 employers less likely to employ disabled people 

Two in five (40 per cent) disabled workers have been pushed into financial hardship over the last year, according to new TUC polling published today (Tuesday). 

The polling – carried out for the union body by BritainThinks – shows how disabled workers’ living standards have been “hit hardest” by Covid-19. 

And leading disability charity Leonard Cheshire is today adding its voice to TUC’s, publishing new research which shows the continuing stigma against disabled workers, and calling for action to break down barriers to employment for disabled people. 

Financial hardship 

Two in five (40 per cent) disabled workers told the TUC that they’ve faced financial difficulty during the pandemic compared to around one in four (27 per cent) non-disabled workers. 

They said that they had experienced: 

  • Increasing debt: More than one in six (16 per cent) of disabled workers said their level of debt have increased compared to around one in 10 (11 per cent) non-disabled workers. 
  • Cutting back on spending: Around three in 10 (28 per cent) disabled workers had been forced to cut back on spending, compared to around two in 10 (18 per cent) non-disabled workers. 
  • Using food banks: Disabled workers (six per cent) were twice as likely to have had to visit a food bank than non-disabled workers (three per cent). 

Disabled workers (22 per cent) were also twice as likely to say they were concerned about losing their jobs than non-disabled workers (11 per cent). 

‘Disability pay gap day’ 

The poll findings are published alongside new TUC analysis which shows that non-disabled employees earn on average £1.90 an hour (16.5 per cent) more than disabled employees – or £3,458 more a year (based on a 35-hour week).  

That means disabled workers effectively stop getting paid today, and work for free for the last 52 days of the year. The TUC has branded today ‘disability pay gap day’. 

And disabled women face an even bigger pay gap. Non-disabled men are paid on average 32 per cent (£3.50 an hour, or around £6,370 a year) more than disabled women. 

The £3,458 pay gap is the equivalent of: 

  • More than a year (13 months) of the average household expenditure on food and non-alcoholic drinks (£63.70 per week) or 
  • Nearly a year (10 months) of the average expenditure on housing, fuel and power (£83.00 per week) or 
  • Nearly a year (10 months) of what the average household spends on transport (£81.60 per week). 

Leonard Cheshire research 

Leading global disability charity Leonard Cheshire is releasing new research today which reveals that disabled workers say they have been left behind by the Covid-19 recovery. 

The Leonard Cheshire study finds that the vast majority (89 per cent) of disabled young people aged 18-24 years old said that their work had been affected by the pandemic, and that one in five employers (19 per cent) would be less likely to employ a disabled person than a non-disabled person. 

The TUC and Leonard Cheshire are urging the government to act now to close the disability employment and pay gap and ensure disabled people gain and retain quality employment.  

TUC General Secretary Frances O’Grady said: “Disabled workers have been hit hardest by Covid-19. Many have been pushed into financial hardship and left without a safety net. 

“With a cost-of-living crisis looming we need urgent action from ministers.  

“As we saw with the last financial crisis disabled people are all too often first in line for redundancy, and those who keep hold of their jobs face a yawning pay gap. 

“Disabled people deserve much better. We need mandatory disability pay gap reporting to shine a light on poor workplace practices that fuel inequality at work. 

“Without this, millions of disabled workers will be consigned to years of lower pay and in-work poverty.” 

Director of Policy at Leonard Cheshire Gemma Hope said: “Disabled people have been disproportionately impacted by the pandemic and employment support is vital to ensure they’re not further left behind. 

“Our research also suggests stubborn levels of stigma amongst employers and that young disabled people remain adrift in the current job market. 

“We call on government to increase efforts to support disabled job seekers and recruiters to continue working with us in recognising the depth of talent available.” 

Government action needed 

The TUC is calling on the government to deliver: 

  • Mandatory disability pay gap reporting for all employers with more than 50 employees. This should be accompanied by a duty on bosses to produce targeted action plans identifying the steps they will take to address any gaps identified. 
  • Enforcement of reasonable adjustments: The Equality and Human Rights Commission (EHRC) should get specific funding to enforce disabled workers’ rights to reasonable adjustments. 
  • A stronger legal framework for adjustments: The EHRC must update their statutory code of practice to include more examples of reasonable adjustments, to help disabled workers get the adjustments they need quickly and effectively. This will help lawyers, advisers, union reps and human resources departments apply the law and understand its technical detail.