The shocking scale of underpayment of the minimum wage in the social care sector was exposed in the House of Commons yesterday by former Care Minister Norman Lamb.
Arrears totalling more than £2.5 million were uncovered by an HMRC investigation conducted between February 2015 and September 2016, which was initiated by Mr Lamb towards the end of his tenure as Care Minister. The review found 183 cases of non-compliance with the minimum wage among social care providers. In the case of one provider, more than £1 million was underpaid.
The revelations came to light in a debate on the Queen’s Speech proposals on jobs and the economy, after Mr Lamb obtained a letter from HMRC detailing the key findings of the review.
Speaking in the Commons, Mr Lamb called the underpayment of the minimum wage “a disgrace” and said that the impact of austerity on some people’s lives is “unacceptable”. He added: “We cannot continue to operate our public services on the backs of poverty wages for our lowest paid workers.”
Mr Lamb called for cross-party talks on “a long-term settlement for the NHS and care that does not involve exploiting the lowest-paid people in our country.”
Speaking after the debate, Norman Lamb said:
“It is intolerable that hard-working care staff are being paid a poverty wage instead of the fair wage that they deserve and are legally entitled to. The HMRC investigation highlights a gross injustice which ultimately stems from a failure to deliver proper funding for social care.
“Cash-strapped providers are faced with the impossible task of meeting unprecedented demand for care as well as higher minimum wage obligations, at a time when local authority budgets are under enormous stress. It is painfully clear that the situation is not sustainable.
“Unless the Government’s commitment to a further increase in the minimum wage is matched by proper funding for local authorities and care providers, I fear that the consequences for the social care sector could be disastrous.
“Patient care will also suffer if we continue to postpone the tough decisions that will need to be made to ensure that we can afford high-quality care for those who need it. It is vital that ministers work with others on a cross-party basis to develop a long-term settlement for social care that is fair and sustainable.”