Ed Miliband will today up the ante in the cost of living debate by unveiling plans to link the National Minimum Wage to national earnings if Labour wins the General Election next year. The new Minimum Wage would be calculated as a percentage of the average of all salaries in the UK, and so would help low earners keep pace with other employees during periods of wage growth or shrinkage.

Miliband told the BBC’s Today programme:

“This gets at a terrible scandal in this country of 5 million in low-paid work unable to make ends meet. We have got to tackle it and I just don’t think we can carry on as we are. The minimum wage has done a good job in tackling the worst of exploitation but we have now got to tackle low pay.”

The measure will be announced today as Labour launch their report on the Minimum Wage, which was carried out by former KPMG deputy chairman Alan Buckle.Labour will not announce an actual figure for their revised minimum wage until closer to the General Election. Last year the Minimum Wage as a percentage of average earnings was 54.6% – it is believed Labour will aim to make this closer to 60% over the course of five years.

Miliband will tell the assembled press:

“It is time to raise our sights again because Britain can do better than this. The next Labour government will restore the link between hard work and building a decent life for your family.

“A Labour government will establish a clear link between the level of the minimum wage and the scale of wages paid to other workers in our economy. We will say workers on the minimum wage must never be left behind because those who work hard to create our nation’s wealth should share in it.”

The report finds that workers on low pay (those paid less than £7.45 per hour outside London and £8.80 in the capital) now total 5.2 million nationally, up from 3.4 million in 2009. One in three female workers in the UK is now classed as low paid.

Photo by Tristan Martin