Public Sector Pay

Lord Spellar Excerpts

Monday 4th December 2017 Westminster Hall

[Helen Jones]

My hon. Friend is absolutely right. Gratitude for public sector workers is not enough; they also deserve our respect. Respect involves paying them a decent wage for the job they do but, sadly, under this Government their wages have been continually held down.

[John Spellar (Warley) (Lab)]

Many of the arguments my hon. Friend has made up to now would have been recognised and endorsed by traditional Conservatives. Is it not unfortunate that, having imported the anti-state ideology from the US Republicans, they now see the state and public service as the enemy rather than a key part of the mixed economy?

[Helen Jones]

I could not have put it better myself. The result was that one of the Conservative Government’s first actions was to announce a two-year freeze on public sector pay from 2011-12. They followed that up with an announcement that public sector pay would be capped at 1% for the following four years and, in his 2015 summer Budget, the Chancellor announced a further four years of the cap, saying that he would fund public sector workforces for a pay award of 1%. That did not mean, of course, that everyone would get even 1%: a letter from the right hon. Member for Chelsea and Fulham (Greg Hands), then a Treasury Minister, made it clear that the money was first to be used—as if—to address recruitment and retention pressures in the system: “there should not be an expectation that every worker will receive a 1% award”. What that meant, of course, was that those people in areas where there were retention pressures received less, and those in areas where there were many people on the minimum wage—46,000 in local government alone—who had rightly to receive a pay rise, received less. Even if a public sector worker got the 1% pay rise, their wages were still declining in real terms. A public sector worker on the median income who had their pay determined by the pay cap would, by 2016, have lost £3,875 in real terms. Real-terms losses of between £2,000 and £3,000 are common throughout the public sector.

A midwife on band 6 will have seen a real-terms decline in her wages of 12.1%. Midwives are leaving the profession at a previously unseen rate. They are leaving the register in serious numbers. A teacher outside London will have lost 10.4% and a band 5 nurse will have lost 11.9%. If the pay cap continues until 2020, there will be a further real-terms decline in wages. A social worker will lose £3,533. A border guard—I thought the Government wanted to secure our borders—will lose £2,520. A firefighter will lose £2,766. The reason for those falls is not hard to find: while wages have been stagnant or hardly rising at all, prices have been rising at a much faster rate.

Beer Duty

Lord Spellar Excerpts

Tuesday 7th March 2017 Westminster Hall

[Steve Double]

My hon. Friend is absolutely right. Whereas many other industries are centralised in very specific areas or regions of our country, the pub industry is spread right across it and provides much needed jobs in many of the more rural areas. He is also right that we need to reduce the gap between the duty we pay in this country and the duty paid in many other countries, and I will come on to that later.

[Mr John Spellar (Warley) (Lab)]

The hon. Gentleman rightly identifies the role of rural pubs, many of which serve those who come out to the countryside from our conurbations. What impact does he think the ill-thought-out proposals from the Local Government Association to cut the number from 2 pints or 1.5 pints to 1 pint will have on those pubs?

[Steve Double]

I assume the right hon. Gentleman is talking about the guidelines for alcohol consumption. I suspect that is a subject for another day, but I understand his point.

[Mr Spellar]

No, I am not talking about the guidelines; I am talking about the drink-drive limit. Most of the offences are recorded at the much higher level of about 150 mg. A reduction in the limit could have a dramatic effect on many rural pubs, let alone rugby clubs, Royal British Legion clubs and so on.

[Steve Double]

I now understand the point the right hon. Gentleman is making. I would never drink and drive at all. That attitude has become much more the norm in today’s society, where most people consider that drinking anything and driving should be avoided. I am not entirely sure that I agree with his point.

The brewing and pub industry not only employs 900,000 people but attracts many younger people to its workforce—in fact, 46% of those employed in the sector are under 25 years old. That level of employment among the young is a critical factor, especially in rural constituencies such as the one I represent in Cornwall. While many start out in basic roles, they go on to become professionals in the trade or elsewhere—for example, working as chefs, licensees or successful businesspeople in their own right, and employing others.

That said, the news has not always been good in recent times. Some 17,000 pubs have closed in the past three decades, and while the closure trend has slowed markedly of late, many communities will grieve the loss of their local, which all too often is the only pub in the area.

--- Later in debate ---

[Steve Double]

My hon. Friend may have been reading my notes, because that is a point I will come on to highlight.

There are many reasons why pubs have closed. Some of them were badly managed, and some lacked investment to keep the facilities up to date. Although I believe that the smoking ban was the right thing to do, and it is popular among many pub goers, we have to acknowledge that it stopped smokers visiting the pub quite so often. There are also changing social habits, with more people drinking at home as a result of cheap alcohol available in supermarkets and other outlets.

Those factors have all contributed, but it is also undeniable that the dreadful and despised beer duty escalator introduced in 2008 had a devastating effect on the industry. Annual duty rises under the escalator led to beer duties rising to among some of the highest anywhere. Even now, following successive years of duty reduction by this Conservative Government, our pints remain heavily taxed at around 52p on a 5% alcohol by volume pint, compared with 4p in other key beer-brewing nations such as Germany and Spain—an enormous and disproportionate difference that needs to be addressed.

There is much more happening now, with a revolution in the old craft of brewing and selling beer to the UK’s 32 million beer drinkers. Numerous microbreweries have opened up and craft beer and real ale are rising in popularity. I have the great privilege of having a great example of a local family-run brewery in my constituency. St Austell Brewery has been a roaring success in recent years, particularly since the launch of its excellent Tribute ale. It now makes many excellent beers, and I spent an enjoyable day during the recent recess assisting master brewer Roger Ryman in making a batch of Proper Job. I count the fact that I managed to make more than I drank that day as a notable success.

While it is right to recognise concerns about alcohol abuse, we must note that the majority of people enjoy healthy levels of drinking. Given the social benefits that come with a visit to the local pub, it makes no more sense to celebrate pub closures than it does to close roads because some motorists speed.

[Mr Spellar]

On the subject of craft breweries, will the hon. Gentleman, who rightly attacks the beer duty escalator, acknowledge the very considerable role played by the duty exemption for small breweries that are getting off the ground? That was a major factor in the explosion of the craft brewery business and was introduced by my right hon. Friend the Member for Wentworth and Dearne (John Healey) when he was at the Treasury.

[Steve Double]

I will happily agree. The support given to microbreweries to develop right across the country—they are now producing very high-quality, excellent craft beer—is a success that should be noted.

Outsourcing and Tax Credits

Lord Spellar Excerpts

Friday 4th November 2016 Commons Chamber

[Simon Kirby]

I am not aware whether there were or not, given that I am a Minister who is relatively new to the Treasury and given that I am dealing with a subject that is not in my portfolio, but I am sure that I can write to the hon. Gentleman clarifying the position.

I pay tribute to the hard-working staff in HMRC, who have helped to resolve what was a very difficult situation. HMRC took back 181,000 cases, and the staff have done a brilliant job, extending the helpline hours and specifically helping MPs. We should all be grateful for that.

[Mr John Spellar (Warley) (Lab)]

It is no wonder that the Chancellor is not here today to respond to the urgent question. We have heard an announcement of no change in policy: in other words, “Do not adjust your mind, reality is at fault.” Apart from the structural weaknesses of this and so many other contracts, time and again we are seeing Ministers and Departments failing to monitor contracts, and failing to react and respond when those failures are pointed out. Once again, we are hearing the same lame old excuse: “Lessons will be learnt.” I ask the Minister, “When will they ever learn?” For a start, will Concentrix be barred from tendering for any future contracts with the Government?

[Simon Kirby]

The right hon. Gentleman speaks of a failure to respond; the Government responded very quickly, which is why we are in this position, having cleared up the mess that we found. He asks when we will learn our lessons; we have learnt lessons, which is why the Concentrix contract is coming to an end. We shall all have to wait for the independent report from the National Audit Office, and there will be further lessons to be learned, but the Government have taken this matter very seriously and have acted quickly, and I think that we have done reasonably well in the circumstances.

--- Later in debate ---

[Simon Kirby]

I understand that the independent National Audit Office will be looking at all those and will report in due course—let us hope that it does so sooner rather than later—and we will learn lessons from that independent report.

[Mr John Spellar (Warley) (Lab)]

On a point of order, Mr Deputy Speaker. In the age of emojis, is there any way in which Hansard will be able to report the look on the Minister’s face when he responded to the question asked by the hon. Member for Manchester, Withington (Jeff Smith)? It said it all.

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Absolutely not.

Finance (No. 2) Bill

Lord Spellar Excerpts

Wednesday 25th March 2015 Commons Chamber

[Mr Deputy Speaker]

It was a business motion that was agreed yesterday, but not the terminology, I presume. Mr Speaker is not in the Chair so I do not know when he was told. I was told about five minutes ago when I came into the Chair. [Interruption.] No, that is correct. There is a business motion. [Interruption.] Mr Doughty, we are trying to deal with this. We have many other points of order on that matter.

[Mr John Spellar (Warley) (Lab)]

Further to that point of order, Mr Deputy Speaker. We have had some slightly strange events on the Budget, with Ministers speaking from the Government Dispatch Box—from the Treasury Bench—but speaking for their parties. My understanding is that the Government speak from there—the Government Benches. May we be clear? Is the motion a Government motion, which has therefore been signed off by the coalition partners, or is it a motion from the Conservative party?

Oral Answers to Questions

Lord Spellar Excerpts

Tuesday 4th November 2014 Commons Chamber

[Danny Alexander]

I agree with my hon. Friend that strong tax receipts require a strong economy, and the focus of this Government’s economic policy since the coalition was formed has been to rebuild the UK economy and clear up the mess left to us by the Labour party. We now have the strongest growth in the major world economies, and Government Members should be very proud of that.

[Mr John Spellar (Warley) (Lab)]

Revenue officials have always been slow to catch up with the latest tax-avoidance scams in the construction industry, the latest of which is the umbrella company. Such companies are costing the Revenue huge sums and are exploiting workers. This is spreading rapidly to other sectors, including supply teaching. What is the Minister going to do about the scandal of umbrella companies?

[Danny Alexander]

We introduced measures precisely to deal with intermediary companies, which are often vehicles for tax avoidance or for minimising tax. We take that very seriously. If the right hon. Gentleman has evidence that he wishes to bring to my attention of specific issues that have come to his attention, I would gladly look at it.

Finance (No. 3) Bill

Lord Spellar Excerpts

Tuesday 3rd May 2011 Commons Chamber

[Kerry McCarthy]

The backdrop to today’s debate is an economy that is flat-lining, as the Chief Secretary to the Treasury admitted last week. Since the Chancellor’s spending review, we have had no economic growth, and it is ordinary people who are hardest hit by that stagnation, with 2.5 million people out of work, including nearly 1 million young people—one in five 16 to 24-year-olds. An increasing number of people have been jobless for more than a year—nearly 850,000 and rising. This year, as the Government’s cuts start to bite, hundreds of thousands more people could lose their jobs. I believe that that is what the Minister of State at the Cabinet Office called an

“immediate national crisis in the form of less growth and jobs than we need.”

Apparently, it is what the Chancellor describes as “good news” and a sign that the economy is on the right track. Families are feeling the effects of the crisis in their pockets. Prices are still rising by more than 5% on the retail prices index, while earnings are growing at just 2% a year.

Rising fuel prices are a big part of this squeeze. According to the Office for National Statistics, fuel prices are currently one of the most significant contributors to consumer price inflation. According to this week’s figures from the Department of Energy and Climate Change, the average UK pump price is now £1.36 for a litre of petrol and £1.42 for a litre of diesel. I am sure that many Members will be aware that at their local petrol pumps prices are even higher. That means that petrol is more than 3p a litre more expensive than it was last month, or 15p more than this time last year, and that diesel is 3p more expensive than last month, or nearly 20p more than last year. Unfortunately, the 1p saving we got from the Chancellor’s cut in fuel duty lasted barely a week before price rises at the pumps wiped it out.

[Mr John Spellar (Warley) (Lab)]

My hon. Friend rightly draws attention to fuel prices. Does she not find it extraordinary that the coalition Government are proposing to subsidise fuel prices in some of their friends’ constituencies, thereby increasing by default the duty on those in many of the urban constituencies that we represent?

[Kerry McCarthy]

My right hon. Friend is quite right that the Government are looking for a derogation in some rural areas, but only a very limited number. When the House last discussed the proposal, considerable representations were made by Government Members who argued that if there was to be a derogation, other areas should also benefit from it and that it was unfair that just a few remote islands should see the benefit.