EMPLOYERS big and small are being urged to pay their staff the new living wage rate of £7.45 and help make York a “beacon against poverty”.

That was the call from Joseph Rowntree Foundation (JRF) chief executive, Julia Unwin CBE, at today’s launch of the of the Living Wage scheme, a nationally recommended hourly rate designed to lift people out of poverty.

Miss Unwin said the rate, up from the previous figure of £7.25 per hour, was good for business and for the country as she revealed that 100 of the JRF’s lowest paid care home employees will receive pay rises to bring them in line with the living wage.

Speaking today in The Hospitium in Museum Gardens, she said: “This is what we are asking employers across York to sign up to. I think this gives York a chance to be a beacon against poverty.

“I think living below this wage is a life of desperate poverty.”

She said that there had been a recent “hue and cry” in York from small businesses who could not pay the rate, but she said companies would benefit from better-paid staff who were loyal to the company.

Joining her for the announcement was Archbishop of York, Dr John Sentamu, who said he was ‘horrified’ to recently discover two members of staff at Bishopthorpe Palace had been earning under the living wage rate, and they had immediately been given back-dated pay rises.

He said: “It’s my hope that the whole of the UK will follow the example being set here. I hope that we will unite in saying a living wage is right, just and desirable.”

Dr Sentamu joked that business leaders could wear badges saying “I pay my employees a living wage” and he added that “the Queen could perhaps hand out a gong to them.”

He said: “On this Guy Fawkes night I want to hear a big bang and explosion from the gunpowder of fairness, justice and income equality.”

The launch of the new living wage rate, which is separate from the legal minimum wage, came at the same time Labour leader Ed Miliband vowed to address Britain's "living standards crisis" by delivering a living wage of at least £7.20 per hour to millions of people in the public and private sector.

According to Citizens UK, the charity which launched the Living Wage campaign in 2001, 45,000 people had since been lifted out of working poverty in the UK.