TUC to fight for minimum wage

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Indy Politics

Labour Editor

A potentially damaging split opened between the Labour Party and unions yesterday when the TUC registered its intention to fight for a specific national minimum wage in the run-up to the next election.

The TUC also declared that, under a Labour government, the unions would expect a central role in establishing, monitoring and applying the figure.

While Tony Blair and other party leaders have endorsed the principle, they are anxious to "see the books" at the Treasury before deciding on a level. The issue is likely to form one of the main economic debates at the hustings and Labour is keen to avoid presenting targets for the Tories.

John Monks, TUC general secretary, said that a figure would probably be set in the wake of September's annual congress and indicated that it would be firmly in place before the next election.

Asked whether the TUC was implicitly attacking the party by setting such a target, Mr Monks said the TUC was trying to influence all shades of opinion. "The TUC is doing its job in the way it sees fit and the Labour Party will be doing its job in the way it sees fit."

Mr Monks' comments are likely to displease the Labour leadership, and he conceded that his reticence over the precise calculation to set the minimum rate could anger left-wing union leaders keen that is set at half median male earnings. That would produce a figure of £4.15 an hour, according to most interpretations.

Mr Monks, however, told a press briefing after a TUC executive meeting yesterday that there were "a number of ways of doing the calculation". Union left-wingers will argue that Mr Monks is trying to talk the figure down to a level that Labour will find less embarrassing.

One calculation would yield a figure of £3.40 an hour, according to a document presented to the executive. The paper pointed out that the annual congress last year did not set a precise figure. A resolution passed by congress delegates called for a level set at half median male earnings, but moderates succeeded in deleting a reference to a figure. Left-wingers thought that such an omission was superficial and that the figure was implicit.

The TUC paper says that a Congress House statement in 1991 did not specify a precise level and neither did a resolution passed in 1994.

A concern for the "employment effect" of the policy was also evident in the document. It would not be enough to simply condemn the present Government's jobs record, it said. "It is important to avoid an over-crude analysis of the employment effect of a national minimum wage." It was necessary to set out the benefits and costs of the policy, as well as those of the present approach, the memorandum argued.

News Analysis, page 15