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Combating worker poverty

David Hencke

BRITAIN'S LOWEST-PAID workers have enjoyed a bigger improvement in their standard of living since 2003 than those in any other European country, according to research by the European Trade Union Confederation. It shows that Gordon Brown and Tony Blair's decision to introduce a minimum wage has transformed the country from a laggard to a leader in the European Union in combating poverty wages.

The research by the EU Institute-Research Education Health and Safety compared the effect of rises in the national minimum wage on workers' purchasing power. It showed that since 2003 a British worker on the minimum wage had seen the purchasing power rise by 18.8 per cent. There was an 18 per cent rise in Spain and 17.4 per cent in Luxembourg. The minimum wage is £5.35 an hour for adults, due to rise to £5.52 in October. Britain's big increase has narrowed the gap between the minimum wage and average wages.

In five countries — Latvia, Poland, Portugal, Malta, and surprisingly France increases in the minimum wage have failed to keep up with inflation. The result has been to encourage workers to quit low-wage countries for Britain. Meanwhile it encourages companies to relocate in eastern Europe or Portugal.

- Guardian Newspapers Limited 2007

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