UK businesses should “just get on with it” and pay the living wage, says Archbishop

The Archbishop of York, John Sentamu, has called for businesses that can afford it to stop dragging their heels and start paying  the Living Wage.

In a passionate speech at the CBI Business Lobby’s annual conference, Sentamu insisted that “work must pay, but not pay poverty wages” and quoted Winston Churchill’s insistence back in 1909 that “It is a serious national evil that any class of His Majesty’s subjects should receive less than a living wage in return for their utmost exertions.”

The Living Wage is currently set at £7.85 and £9.15 in London, but many companies say that they cannot afford to pay this. Sentamu agreed that this is true in a small number of cases, but said: “Most businesses, sorry to say, they can afford to pay the living wage and they should just get on with it

He added: “Billions of pounds are spent each year topping up the incomes of low paid workers at a time when public finances are very, very tight indeed. Demand is sucked out of the economy by the lack of spending power for over a fifth of the workforce. And where inequality grows we all become diminished. It makes us all much poorer.

Nearly 1000 UK businesses have pledged to pay the Living Wage, but research released by KPMG last week found that the number of people who are paid less than the living wage is actually on the rise, with women and younger workers more likely to fall below the threshold.

Mike Kelly, Head of Living Wage at KPMG, said: “With the cost of living still high the squeeze on household finances remains acute, meaning that the reality for many is that they are forced to live hand to mouth.  Inflation may be easing, but unless wages rise we will continue to see huge swathes of people caught between the desire to contribute to society and the inability to afford to do so.

For some time it was easy for businesses to hide behind the argument that increased wages hit their bottom line, but there is ample evidence to suggest the opposite – in the shape of higher retention and higher productivity.  It may not be possible for every business, but it is certainly not impossible to explore the feasibility of paying a Living Wage.”