Meeting of the Parliament 01 March 2016
I, too, thank the Economy, Energy and Tourism Committee for the report and for inviting me to give evidence for the inquiry. I listened with interest to Murdo Fraser and noted a number of specific points, one of which sounded almost like a Conservative call for increased public expenditure. That may go down in history as the first time that I have heard that, although Murdo Fraser will no doubt say that he was speaking only in his role as committee convener.
Since my appointment as Cabinet Secretary for Fair Work, Skills and Training, promoting fair work has been a key focus of the Scottish Government, and it is helpful that the committee has taken that up through the inquiry. Our programme for government sets out our vision for creating a fairer Scotland. We are committed to promoting a culture of fair work, and the committee’s report highlights key areas in which the Government has taken action.
One of those areas involves the living wage, which is one of the issues that Murdo Fraser raised. I am sure that many members have heard at first hand, as I have, what the living wage can offer people who work in Scotland. When I talk about the living wage, I am talking about the true living wage and not the enhanced minimum wage that the United Kingdom Government is introducing for over-25s. The living wage has made a difference to individuals, which ranges from their being able to afford to decorate a nursery, for example, to their having savings in the bank and perhaps being able to go on holiday. Those simple things would not be attainable for some people without the living wage.
It is not just employees who can benefit from the living wage. I have often spoken of the benefits that it can bring to employers and the wider economy. It is not unusual for employers to tell us that moving to the living wage has made a difference to their productivity, reduced their staff turnover and reduced absenteeism. That is part and parcel of the package of work.
As of yesterday, the Scottish living wage initiative has accredited more than 477 organisations, which means that we are on course to reach our target of 500 by the end of March. The wider picture on wages is positive, too. According to Resolution Foundation analysis that was published in January, pay in Scotland has grown faster than that in any other nation or region in the UK over the past two decades. We know that Scotland has the second highest proportion of employees who are paid the living wage or more across the countries and regions of the UK.
Last month, we made a decisive commitment to enable payment of the living wage in the social care sector. That is an important action that we believe will help to deliver fairer workplaces and better-quality care in a sector that is sometimes characterised by low pay. Some companies that operate in the care sector are signed up as accredited living wage employers, and I encourage other employers to follow that lead. This is not just about wages; fair work is about much more than that, and the results in the workplace can often be tangible.
The committee welcomed the Scottish Government’s work on procurement, which the committee convener discussed in his opening remarks. We are addressing a number of fair work issues through public contracts. Since 1 November last year, all public bodies have been required to consider how they can address fair work practices when they prepare tenders to go out to competition, and the new statutory guidance makes it clear that the Scottish Government sees payment of the living wage as a significant indicator of an employer’s commitment to fair work practices. That is one of the clearest ways in which an employer can demonstrate that it takes a positive approach to its workforce.
However, the convener was right to point out that the living wage is not the only measure. We are sending a clear message that exploitative practices such as the inappropriate use of zero-hours contracts and umbrella companies are not acceptable.