National Minimum Wage Naming Scheme

Lord Stevenson of Balmacara Excerpts

Wednesday 5th June 2019 Lords Chamber

[Lord Stevenson of Balmacara (Lab)]

My Lords, I am very grateful to the Minister for repeating the Statement. I am still a bit confused, however. He went on at length about the value the Government place on the scheme, but has it actually been suspended during this review, or not? Will he confirm, for the record, that the review the Government are carrying out is actually on the effectiveness of the naming and shaming scheme, not on the scheme itself, that the scheme has not been suspended or dropped, and that naming and shaming will continue until such time as a firm decision has been reached by the Government on the current review? Will he also confirm that, although it is true that the director of labour market enforcement called for an evaluation of the naming scheme, this was only one of 37 recommendations made in the excellent 2018 report? What is happening to the other very important recommendations, including the one to which he referred which called for greater use of, and more publicity for, prosecutions, undertakings and orders, so as to alter employers’ behaviour by raising their risk of being caught and increasing the penalties for breaching the law?

[Lord Henley]

My Lords, naming and shaming is just one of a number of different actions that can be taken, alongside self-correction by employers, the civil penalties that are available, and the criminal proceedings and resulting fines. As the noble Lord said, and as I made clear in the Statement, we will review the naming and shaming scheme and he will have to await further announcements on that. As my honourable friend Kelly Tolhurst made clear yesterday, she considers that it has been effective, but it is obviously quite a draconian measure to use against employers and we should be wary about the effect it might have on them. I think it is quite right that the Government should consider how to operate this in the future: that is what we are doing and I ask the noble Lord to be patient about this and about the other recommendations made by Sir David. In due course, announcements will be made.

--- Later in debate ---

[Lord Henley]

My Lords, I am afraid that I cannot answer the noble Countess’s question, but if I have any further information, I will certainly write to her. However, as I made clear in the Statement, we have increased the resources available to HMRC, more or less doubling them. I am told that last year it completed some 3,000 investigations and issued £17 million in financial penalties to more than 1,000 non-compliant employers. Obviously, more can be done, and we will do as much as we can to make sure that where there is legislation—which has had all-party support—it is effective with regard to the employers concerned.

[Lord Stevenson of Balmacara]

My Lords, I am a patient person, and I was glad that my patience has resulted in getting a statement out of the Minister which he was perhaps reluctant to make. His noble friend asked whether this scheme had been suspended. He ducked that question and said that it had not been suspended, but I took from him—I would be grateful if he could confirm it—that the scheme in its present form is not being used until the results of the review have been published. We do not know when that will be but we hope it will be imminent. Given that most of the 37 recommendations in the very good report we have referred to assume that the scheme will continue, are the Government really considering suspending it completely?

[Lord Henley]

I will not prejudge that review. We have made it quite clear that we believe the scheme is effective, but, as I have made clear, on occasion it can be quite a draconian power. We want to look at how the scheme works, whether it is good, and whether it is, as I put it, a useful tool to have in the box to deal with this issue.