National Minimum Wage

Debate between Lord Offord of Garvel and Lord Hannan of Kingsclere

Wednesday 21st February 2024 Lords Chamber

[Lord Offord of Garvel (Con)]

I thank the noble Lord for that. There is a wage scale, as he will well know. For those aged 18-20, it is £8.60 an hour and for those under 18 it is £6.40 an hour, an apprentice rate. The point of this is a scale. We all start work on lower wages and increase our wages as our skill levels increase. We must not be in a situation where we, in effect, lock young people out of the market. We must ensure that young people get into the market earning wages and then increase their skills and their wages. The noble Lord will know well that many studies have been done on the wage scar, which blights young people if they do not get into a job early and get training. We want young people in a job early, trained up, so they can increase their wages.

[Lord Hannan of Kingsclere (Con)]

My Lords, has my noble friend the Minister’s department made any assessment of whether these increases in the minimum wage, which go well above and beyond average wage increases, have impacted the ability of companies to take on interns, which is normally the main route into employment; whether they have had an impact on speeding the adoption of automation and assimilating the upfront costs; whether employers respond by cutting in-work benefits, discounted meals and so on, to compensate; and, not least, what the impact is on the price rise of the finished product, because often people on minimum wages are also consumers of minimum wage products? If, for example, fast food becomes much more expensive, it is not going to be hedge fund managers who pay.

[Lord Offord of Garvel (Con)]

I thank my noble friend for that. The cost to business is a consideration that we must consider. The cost of this particular increase will be £3 billion over six years and I emphasise that it will fall largely on the SME community. Some 99% of our companies are SMEs, with 2.5 million VAT-registered companies. Setting aside the 10,000 companies that employ 30% of the workforce, 60% of the workforce are employed in SMEs and they are bearing the brunt of exactly these wage increases. We survey employers and they want to pay higher wages. We want a good, well-paid workforce but we must do so in a way that balances the needs of business and workers.

UK-Canada Trade Deal: Suspension of Negotiations

Debate between Lord Offord of Garvel and Lord Hannan of Kingsclere

Tuesday 30th January 2024 Lords Chamber

[Lord Offord of Garvel (Con)]

I thank the noble Lord for that question. We fundamentally agree with that. We have been talking with the cheese manufacturers all the way through this. We send £200 million-worth of food to Canada and it sends us the thick end of £600 million back, mostly wheat, maize and lobster. However, we do not want to take the hormone beef. That is where the beef is. The issue, therefore, is that we have £18 million of trade that we need to try to support, and we will do our best to support those impeccable farmers, especially in the West Country and in Wales.

[Lord Hannan of Kingsclere (Con)]

My Lords, Canada is notorious for gearing its trade policy around its dairy sector, which is particularly strong in Quebec. However, is not the wider issue here whether Britain will always follow EU rules on sanitary and phytosanitary standards? According to the WTO, SPS measures must never be economic and can be justified only by science. The EU’s ban on these various kinds of beef has been condemned by its own scientific advisory agency and by the WTO. Is it the view of my noble friend the Minister that our SPS regime, as long as it is tied to the Brussels one, it is compatible with WTO regulations?

[Lord Offord of Garvel (Con)]

This is the issue. Canada has been in a recent—2016—deal with the EU and understood the SPS rules of the EU. It understands fundamentally that we are not reducing our rules on SPS, but it has seen an opportunity, and you go for the gap when you see the opportunity, do you not? If you are a trade negotiator, you think to yourself, “Where can I get my point of advantage?” On our two outstanding issues, the cheese and the rules of origin—where, again, we are pretty much sorted with a rollover from the EU—Canada has seen an opportunity to cross that line. It is a pause in negotiations and we will get back round the table as soon as it comes back over the red line.