The government should give pay rises to the public sector’s lowest paid workers, according to the Living Wage Commission.

The Commission is formed of businesses, trade unions and other stakeholders and campaigns for pay structures that meet the financial pressures of everyday life.

In its latest report it says the government should cut the number of low-paid workers on its books by one million.

The commission defines a living wage as "an hourly rate of income calculated according to a basic cost of living in the UK and defined as the minimum amount of money needed to enjoy a basic, but socially acceptable standard of living".

It stands at £7.65 outside London and £8.80 within that capital, allowing for the higher cost of living. The national minimum wage, for which there is no London weighting, is £6.31.

Responding to the report, business secretary Vince Cable said: "The only real way of achieving sustainable increases in living standards is by focusing on economic growth, employment and reducing taxes for the low paid. This is exactly what we are doing."