Unions are disputing the Government's reasoning for scrapping living wage contract rules.

This move is part of a wider proposal to simplify the procurement process for companies wanting Government contracts.

Council of Trade Unions President, Richard Wagstaff, says the argument that small businesses are missing out because they can't afford wages doesn't make sense. 

"What it is, basically, is a standard. And everyone bidding for Government contracts has to meet the same standard, so there's no disadvantage to a small, medium or large businesses. They're all on the same playing field."

Wagstaff explained that small businesses can be competitive. 

LISTEN ABOVE