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MINISTERS’ promised crackdown on companies failing to pay the so-called national living wage is mere window-dressing after savage cuts to tax credits, campaigners charged yesterday.
Prime Minister David Cameron said that businesses face paying fines of up to £20,000, while bosses could be barred from being company directors for up to 15 years if they did not pay workers fairly.
From next April, employers will have to pay all workers aged over 25 at least £7.20 an hour. The current minimum wage — which the Tories cynically rebranded a national living wage in the last Budget — is £6.50 for over 21s.
Mr Cameron added that the minimum wage would slowly increase to £9 an hour by 2020 — well short of the £10 an hour activists are demanding now.
Even with the current rate, the Tories’ plan to slash child and working tax credits will keep short-changing workers and more than 7.5 million children across Britain whose families rely on them to top up their low wages.
A family with two children where both adults work 35 hours a week on the minimum wage will lose £1,615 a year, rather than being £850 better off as they would be if no changes were made to tax credits next April, according to a study carried out by public-sector union Unison.
Unions criticised the Tories for giving with one hand while taking with the other.
GMB national officer Martin Smith said: “This is more window-dressing by the Tories. There have been few employers taken to court and the level of inspections has been pathetic.
“The Tories realise that allowing employers a free hand to exploit UK and migrant workers will impact on the EU referendum vote. This is why we are seeing a lot of ministerial announcements on migration and pay.”
Unite leader Len McCluskey said the Conservative Party could not be trusted as it had “weakened” the powers of the Gangmasters Licensing Authority — which seeks to protect workers at most risk of exploitation — and has sought to remove workers’ rights through EU treaty negotiations.
It would take “some leap of faith” to believe that the Tories are now committed to workers’ rights, considering their track record, he added.
Mr Cameron’s announcement “will ring hollow for many trade unions and campaigning organisations,” a spokeswoman for Labour leadership favourite Jeremy Corbyn said.
“The most effective enforcement of pay and conditions comes from having strong trade unions in the workplace, which is why the government is wrong to be weakening trade union rights in its Trade Union Bill,” she added.