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Labour dubs flagship policy a failure

Scots firms ‘ignoring’ SNP’s call to back living wage

Jackie Baillie
Jackie Bailie: Pledge is an exercise in PR (photo by Terry Murden)

An SNP attempt to persuade businesses to  pay the living wage and promote fairness at work has been dubbed a failure after signing up just a handful of supporters.

Scottish Labour says only 0.2% – 371 firms registered in Scotland – have signed up to the Pledge which was launched by First Minister Nicola Sturgeon two years ago.

Not a single business from the accommodation and food services industry has signed up despite this being the sector with the highest incidences of low pay and insecure work in the Scottish economy, with a third of workers under 25. 

Almost half of the signatories come from sectors with traditionally better conditions – such as information and communication and professional, scientific and technical activities. 

To sign up to the pledge, a company must commit to paying the Living Wage and to two other criteria from a list of nine that range from not using zero hour contracts to paying bills promptly.

Businesses responded cautiously to the Pledge when it was unveiled by Ms Sturgeon in May 2015 and said a number of the required conditions were already being met. The Chambers of Commerce said that 81% of employees in Scotland were already earning the Living Wage or above, while some companies were struggling to survive and could not afford to raise wages.

Labour made a similar claim about the scheme’s shortcomings last October when it stated that 276 firms had signed up. On that occasion the Scottish government said it was “continuing to promote fair pay and conditions through a number of fair working practices, of which the business pledge is just one approach.”

In January last year the SNP acknowledged the Chambers of Commerce figure.

Labour today said the figures, coming a few days after Scotland narrowly avoided recessionwere evidence of the SNP’s failure to promote a proper industrial strategy. 

Shadow Economy Secretary Jackie Baillie said: “The Business Pledge is beginning to look more like an exercise in PR than one in economic development. 

“The SNP has only convinced 0.2% of Scottish business to sign up to this flagship scheme, with only 3.5% of Scottish jobs covered by it.

“In traditional low wage sectors with insecure work, like hotels and the hospitality industry, not a single business has signed up.  

“With a third of hospitality workers under 25 this is simply a failure of the SNP government to stand up for younger workers.

“Serious questions about how effective this scheme is need to be asked – it seems very doubtful that it is promoting better wages and productivity.”

Labour’s analysis of the Business Pledge follows the publication last week of its Industrial Strategy. 

Ms Baillie said: “Labour will look to change the law to give workers better rights, use the powers of the Scottish Parliament to increase investment in education and skills, and use public contracts to extend the Living Wage into the private sector.  

“No business that engages in blacklisting or tax dodging should be rewarded with taxpayer cash, instead they should be incentivised to pay better wages through public contracts. 

“After a decade in office the SNP is out of ideas. Only Labour is making the positive case for an economy that works for the many, not the few.

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