Labour goes on attack over `Scrooge' pay rates

Labour demands for a statutory minimum wage were stepped up last night after government figures showed more than 500,000 employees are earning less than £3 an hour, writes Colin Brown.

The figures, given in a letter from Philip Oppenheim, Under-Secretary of State for Employment, to Denis McShane, a Labour MP, will be used by Labour in a new year offensive on the minimum wage.

Labour employment spokeswoman, Harriet Harman, spearheads the attack later this week. Ministers believe the minimum wage is Labour's Achilles' heel, but party strategists are convinced the policy will prove popular with the thousands suffering low pay. Mr McShane said 2.5 million part-time workers would benefit from a minimum pay rate of £4 an hour, still less than half the middle range of hourly pay in Britain.

The figures, from a parliamentary written reply, also show wide regional disparities in "scrooge-like'' rates. In Greater London, one in five part-time workers earns less than £4 compared with one in two in South Yorkshire. Mr McShane, MP for Rotherham, said the figures were "intolerable in the nation which gave the world the image of Scrooge at Christmas".

The Government has warned that a minimum wage would destroy jobs for the low paid.