Pressure is mounting on UK firms to pay a living wage rather than the minimum wage, which would lift six million people out of poverty and generate an additional £4bn of revenue, according to a new report.
The living wage, defined by the Living Wage Foundation, is £7.85 per hour across the UK and £9.15 per hour in London, compared to the national minimum wage of £6.50 per hour.
The new report from KPMG comes ahead of the Budget on Wednesday and amidst speculation that the Chancellor George Osborne may look to incentivise companies into paying higher wages for lower paid workers.
Former Conservative advisers Steve Hilton and Rohan Silva have also called for companies to pay the living wage, as the government looks set to cut in-work benefits.
Silva, who is also co-founder of Second Home, a social enterprise that creates new cultural venues and creative workplaces for entrepreneurs, wrote in The Observer yesterday that it is “ridiculous” that some organisations claim they cannot pay a living wage, saying: “If a small business like mine can do it, there is no excuse for multinationals and public sector behemoths.”
In April, a report from Citizens UK said retailers paying below the living wage cost the taxpayer almost £11bn a year.