Caution in Living Wage Approach

Today's meeting of the Local Government and Regeneration Committee saw interesting evidence from Scotland Excel, Thompson's Solicitors and the Scottish Government concerning the living wage. This morning the committee focused on the issue of procurement and its relationship to the living wage.

Commenting, Scottish Conservative Local Government Spokesman Margaret Mitchell MSP said:

"Whilst the living wage is something to aspire to, in light of this morning's evidence session, it is clear that there are some real concerns and many questions to be answered about its introduction particularly in terms of procurement contracts."

"The committee heard one opinion that payment of a living wage could be introduced as a procurement contract performance award clause in the award of public contracts if section 39 of the Public Contracts (Scotland) Regulations 2006 were amended. However, whether such a clause would be considered discriminatory under the principles of Treaty on the Functioning of the European Union and a restriction of freedom to supply services was in dispute and awaiting clarification from the European Commission."

"What was not in dispute were the concerns expressed by the CBI, who recommend a 'highly cautious approach."

"Quite simply small to medium sized businesses must not find themselves priced out of competing for public contracts. This could in turn lead to job losses or a situation where job opportunities are not created because of procurement contracts' performance conditions to pay a living wage."

"This is especially the case given the current economic climate where we are all suffering from the consequences of Labour's legacy of debt which sees £120million every day being paid to service interest alone."

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