CBI angers unions by demanding minimum wage freeze
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CBI angers unions by demanding minimum wage freeze

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The Confederation of British Industry (CBI) has called for the minimum wage to stay at its current level for 2005, claiming that academics, trade unions and businesses “could not possibly have a clue yet” about the impact of the latest rise in October 2004.

The CBI’s director general, Digby Jones, said he would be ready to accept a minimum wage of more than £5 per hour – but not until 2006.

He said: “The Low Pay Commission (LPC) should not to be afraid to hold the wage at £4.85 next year and should reinstate its policy of having a pause for a year after above-inflation increases.

“The minimum wage is a success and business wants it to stay that way, but the LPC must not gamble with the jobs of our most vulnerable workers. The Trades Union Congress’s (TUC) calls for a rise to £5.35 in 2005 and towards £6 in 2006 is irresponsible.”

The TUC reacted angrily to Jones’ comments, calling them tight-fisted.

The TUC’s general secretary, Brendan Barner, said: “It’s disappointing Britain’s bosses put such a mean spirited submission to the LPC. There is no reason why Britain’s lowest paid should see their pay frozen for the next year.

“Our proposals would benefit around two million low paid workers, the target agreed by all LPC partners.”

The British Hospitality Association (BHA) supports the CBI’s views and claims that future increases in the minimum wage could threaten jobs and hours worked.

In a survey conducted among its members, the BHA said around half of the businesses polled would cut jobs if the minimum wage rose to £5.50.

Martin Couchman, deputy chief executive, said: “Higher minimum wage rates will have a progressively serious impact on profitability and margins.”

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The Confederation of British Industry (CBI) has called for the minimum wage to stay at its current level for 2005, claiming that academics, trade unions and businesses “could not possibly have a clue yet” about the impact of the latest rise in October 2004.
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