A living wage for a minimum
acceptable standard of living
donald.hirsch@googlemail.com
What is a minimum income
standard?
• What income people need to enjoy a
minimum acceptable standard of living
• Based on social consensus
• Calculated from a “basket” of goods
and services
What is a minimum acceptable
standard of living?
‘A minimum standard of living in
Britain today includes, but is more
than just, food, clothes and shelter.
It is about having what you need in
order to have the opportunities and
choices necessary to participate in
society.’
Who decides what is included?
• Detailed research with groups of
members of the public builds social
consensus
• Informed by expert knowledge
• Kept up to date as social attitudes
change
What is in the basket?
• Balance between physical requirements
and social participation
• “Needs”, not “wants”: not an
“aspirational” living standard
What is in the basket?
IN
Computer
Mobile phone
1 week UK holiday
Occasional
takeaway, modest
meal out
OUT
I-phone
Foreign holiday
Birthday presents
Car
Washing machine
Tumble dryer
Dishwasher
Designer trainers
From income requirement to
living wage
A. Different households need to earn different amounts
• You need to earn more to feed a larger
family
• Tax credits help to even this out
• We look at an average requirement for
households working full time
From income requirement to
living wage
B. Some particular costs vary across the country
and sectors
• Supermarkets have national pricing but eg
housing and childcare vary greatly
• For variable-cost items, we take average cost
outside London
• Use council rents as “baseline” for families. Low
private sector rent for those without children
Living wage of £7.20
represents:
• A baseline below which families outside London
cannot generally afford an acceptable living standard,
even if they work full time
• A standard for social participation, not mere survival:
“Food and shelter keeps you alive, it doesn’t make you
live”
A benchmark that reflects social values today, which
will change over time with society
A living wage for a minimum
acceptable standard of living
Donald Hirsch