Mayoral contenders criticise Hackney Council over cleaners low pay

Hackney Town Hall, Mare Street

Hackney Council has been accused of making a 'pact with poverty' over cleaners' low pay Photo: © Hackney Citizen

Other mayoral candidates have criticised Hackney’s current mayor Jules Pipe over a recently renewed council cleaning contract that pays workers less than the London Living Wage.

The London Living Wage (LLW), introduced by the previous London Mayor Ken Livingstone‘s administration five years ago, is a London weighted minimum wage, which takes into account the higher living costs of London. The figure currently stands at £7.60 per hour; £1.87 above the National Minimum Wage.

Andrew Boff, Conservative candidate for Mayor commented, “Jules Pipe spouts about it [the London Living Wage] but recently was happy to authorise a Learning Trust contract to KGB for school cleaning that would see operatives working for very much lower than the Living Wage of £7.60 an hour.

“This is a pact with poverty and Labour councillors have supported it. If Hackney Council was serious about the Living Wage they wouldn’t be producing “comparison” tenders. They should only be producing tenders with the [London] Living Wage built into them.”

Mischa Borris, Green party candidate for Mayor said, “The news that Hackney Council is knowingly allowing its cleaners to be paid below the London Living Wage, having them work long and anti-social hours on wages that makes it hard to survive in London, is shocking and unacceptable.

“The council has a duty to the taxpayers of Hackney to deliver its services under its Best Value legislation. However, when Best Value means having its cleaners work for a substandard wage, I think that the council needs to seriously re-evaluate its priorities.

“Hackney Council signed up to the London Living Wage to great fanfare in 2005, meaning that all of their staff will receive at least a higher minimum wage that takes into account higher living costs in London.

“That the council should breach this is not only bad news for the cleaners now having to survive on low wages, but also for the reputation of the council as fair employers.”

Adrian Gee-Turner, Liberal Democrat candidate for Mayor said, “[We] need to have a public sector lead from Councils for the London Living Wage. Yes, the council has signed up to it for employed staff, but I was around when the Best Value Program (using external contractors) was put together and you can take local issues into account.

“We should tip the balance to local suppliers for the cleaning contracts and insist in London Living Wage, and demonstrate the Best Value practice for the welfare of Hackney in the round and not in isolation.”

Monty Goldman, Communist candidate for Mayor said, “I fully support the London Living Wage and believe that it is the only way to ensure Londoners do not live below the poverty line. I am extremely disappointed that the Council has put ‘Best Value’ before principle, something unscrupulous employers do on a regular basis.

“Indeed this approach mirrors that of the Tory Mayor of London in his behaviour on the Underground. Moral and correct behaviour cannot be expected from all employers who are often too busy chasing pennies to care about the living standards of their employees but the people of Hackney should expect better from their democratic institutions”.

A spokesperson for Hackney Council said, “The London Living Wage was carefully considered in the award of the 2009 cleaning services contract. It was not possible to apply the London Living Wage for this contract as it saw a significant increase in costs to the Council from all bidders which did not fit with Best Value legislation.”

“All bidders were informed of the Council’s support for the London Living Wage and were asked if they paid their staff the London Living Wage. If not, they were asked what if any effect payment of London Living Wage this would have upon costs.

“All submitted increased bids (around 26 per cent more) for London Living Wage and none of the bidders offered improvement on any of the quality criteria arising from payment of the London Living Wage.

“All local authorities are obliged to consider Best Value legislation in everything they do, including the award of contracts and Hackney has had a great deal of success in improving the quality of its services and getting better value for money for local taxpayers.

Best value legislation was introduced in 1999 by the current Government.

In 2008, government ministers and Hackney residents Ed Balls and Yvette Cooper launched an attack on the London Living Wage – the then £7.45 an hour recommended minimum for all workers in the capital. They said it would was not “necessary or appropriate.”

According to SERTUC (Southern and Eastern Trades Union Congress), “When negotiating with public sector organisations for the implementation of living wage policies through supply chains, one argument that unions often face is ‘it’s contrary to public procurement legislation’.

“It’s often reported by council officers and elected members that there’s nothing they can do about putting a living wage threshold in contracts – this is simply not the case as the Greater London Authority is illustrating. There is no definitive legal opinion on this subject as no case has been brought to court and therefore no legal precedent has been set.”

The London Living Wage is paid to all Greater London Authority  staff and also to all workers sub-contracted to deliver services on behalf of the authority.

SERTUC continues, “According to Recital 33 of the EU Procurement Directive on Public Services and Utilities, a public sector organisation [such as Hackney Council] can adopt a living wage policy stipulating that quality and good value depend on good employment practices.

“Choice of bidder should not be based on lowest price alone. Bidders should be evaluated on terms and conditions, training, industrial relations, union recognition, health and safety and social impact. Under EU rules, contracts can be awarded on the basis of “most economically advantageous tender”, not just the lowest price.

“The European Court of Justice in the Helsinki Concordia Bus case (c-513199) decided that “factors which are not purely economic may influence the value of a tender from the point of view of the contracting authority”.

Hackney Citizen has asked the Council whether Best Value legislation was taken into account when determining the salaries of Hackney Council’s highest paid officers, who have ultimate responsibility for negotiating and managing Council contracts and is awaiting its response.

According to the Town Hall Rich List, a report by the Taxpayers’ Alliance, the highest paid council officers include:

Chief Executive £117,956

Corporate Directors of:
Community Services £131,698
Neighbourhood and Regeneration £131,698
Legal and Democratic Services £131,698
Customer and Corporate Services £131,698
Finance and Resources £131,698

Deputy Directors of:
Children and Young People £107,469
Neighbourhood and Regeneration (Acting) £107,469
Community Services (Acting) £107,469

Update: Hackney Council responded 6.10pm Tuesday 4 May.

A spokesman said, “Like all local authorities, Hackney has to ensure it achieves best value in its use of resources.

“The Council needs talented people to deliver consistently improving services for residents and businesses whilst ensuring value for money – the government announced last year that Hackney had achieved the country’s third highest total of efficiency savings.

“Salaries are in line with other London authorities, and represent a tiny fraction of the workforce of over 3,700 and the gross budget of over £1 billion.”

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