19/05/2014 07:18 BST | Updated 19/05/2014 07:59 BST

Ed Miliband Vows Massive National Minimum Wage Rise

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British opposition Labour Party leader, Ed Miliband (L) speaks with British Prime Minister, David Cameron (R) before listening to German Chancellor Angela Merkel's address to both Houses of Parliament in the Royal Gallery of the Palace of Westminster on February 27, 2014 in London. German Chancellor Angela Merkel urged Britain Thursday to stay in the EU but played down David Cameron's hopes that her visit to London would bring major reforms. The British premier rolled out the red carpet in his

Ed Miliband has pledged that the national minimum wage would rise substantially, being linked in law to average earnings, if Labour returned to power.

The Labour leader, who recently has taken on former Obama adviser David Axelrod as an election strategist, said he would follow the US president by making increasing workers' pay a "basic principle" of his government.

Miliband also warned that the UK was one of the worst countries in the developing world for low-paid workers, telling the BBC Radio 4 Today Programme: "The bigger picture is this - we are one of the worst countries among developed countries when it comes to low pay. We are doing badly as a country.

"It's true that the jobs that were 50p or £1 an hour that I remember from the 1980s aren't there any more but we have much, much further to go.

"It's a basic principle for the next Labour government that people who are going out to work and putting in the hours should be able to get a decent return.

"It's also saying that for the next Labour government the route to social justice and tackling poverty will not be based on higher welfare spending but will be based on giving people a proper reward in work."

He added: "Here's the interesting thing - every country around the world is seeking to address this question, whether it's President Obama in the United States, or other countries, they are facing up to this question."

Labour is publishing a report commissioned by Miliband from Alan Buckle, the former deputy chairman of KPMG International, with proposals to overhaul the Low Pay Commission.

Buckle said: "Making work pay, through an economy that supports a higher skilled, better paid and more productive workforce, is the key to cutting the social security bill and thereby improving government finances."

Speaking at the launch of his party's review of the minimum wage, Miliband will say: "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."

Katja Hall, chief policy director of the Confederation of British Industry, warned politicians against setting wages, warning: "I think we need to recognise that the system we have at the moment has been really successful and that system involves the setting of the minimum wage by an independent Low Pay Commission.

"They have done a really good job and we think it's much better the job is left to them rather than given to politicians."

See also: 11 Attacks On The Minimum Wage The Tories May Come To Regret