NEW or expanding businesses applying for grants will get more money in they pay staff the “living wage.”

The West Yorkshire Combined Authority has recently revised the criteria of its Business Growth Programme - a scheme to provide financial support to businesses in the area.

When a business applies for such a grant, the support it gets can include a set amount of money for each job created.

Under new criteria, which come into play next month, businesses that have successfully applied for the grants will get up to £12,500 for every new employee paid the living wage (£8.50 an hour). The grant falls to £7,500 if the new job is on minimum wage pay rates (£7.83 an hour).

The minimum wage is a voluntary rate - deemed to be the salary needed for a person to maintain a normal standard of living. But concerns have been raised about the viability of smaller businesses paying the higher rate.

The authority says the new criteria for grants will “better target limited public support at those businesses seeking to ‘get ahead of the curve’ on matters such as in-work progression, apprenticeship opportunities, supporting employees with disabilities, introducing sustainable travel and boosting productivity.”

Other criteria includes that for every £1 of funding sought, applicants must be able to provide at least £4 of private sector investment.

Originally the authority considered only offering support for living wage jobs. However, a consultation saw businesses voice concerns that this could become major barrier for many businesses in applying for the grants.

They said this was down to “the cost implications in sectors with typically low margins.” This led to the authority altering the proposals so that businesses who cannot afford to pay the living wage can still apply for grants, although at a lower level.

Councillor Susan Hinchcliffe, Chair of the Authority and Bradford Council Leader said: “These new measures mean that our investment in growing businesses will also enable businesses to contribute to improving living standards and opportunities for the people of Leeds City Region.

“Businesses taking positive actions such as taking on an apprentice and incentivising businesses to progress towards paying the Real Living Wage will have a real impact on the wider region in which they operate. I am very pleased that through working in partnership with the private sector we are realising our shared vision for a strong, successful and socially inclusive economy.”