National Minimum Wage
Debate between Alec Shelbrooke and Sheila Gilmore(10 years, 2 months ago)
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Alec Shelbrooke (Elmet and Rothwell) (Con)
It is a genuine honour to follow the hon. Member for Birmingham, Erdington (Jack Dromey), who has a long history of supporting the lowest-paid in our society, and a long history of defending workers’ rights. When he speaks, he speaks not just with passion but with experience. That is in stark contrast to the synthetic arguments that we have heard from the Opposition Front Bench so far. I hope that today’s debate will reach a different level, because what we have observed so far is a lot of complacency about what Members think people want to hear when they are electioneering.
For me, this is not just an issue of party politics. I can agree with most of what the hon. Member for Birmingham, Erdington has just said—as, indeed, can most of my colleagues, especially those who are members of the new generation of Conservatives and Liberal Democrats on the Government Benches. We have been in those jobs at the bottom. We have seen what it is like to be on short-term contracts, and what it is like to work as a sole trader. I was a kitchen and bathroom fitter. When the contracts that I had in the university of Leeds were short-lived, I had to plug the gaps. That, in many ways, was a zero-hours contract. I have a great deal of respect for what was said by the hon. Member for Edinburgh East (Sheila Gilmore) about zero-hours contracts. I wish that she would stand up and name the company concerned, and I offer her the opportunity to do so now if she wishes.
Alec Shelbrooke
I am delighted that the hon. Lady has named that company, because there can be no excuse, in our society, for forcing people into a position at work in which the employer says, effectively, “Do as I say, and you cannot do anything else.” That is wrong, as the Prime Minister said in his conference speech. Zero-hours contracts have their place—they can work for people—but it is absolutely wrong and immoral to say to someone “We will tell you when you can work, and if you dare to work for anyone else, you will not be paid.”
Alec Shelbrooke
The hon. Gentleman has made the mistake of believing that zero-hours contracts are wrong in themselves. They offer flexibility to people. What is wrong and unacceptable is the abuse of zero-hours contracts, when an employer says “You cannot work for anyone else.” That is what is wrong. The hon. Gentleman needs to take a close look at Members in his own party who have people on zero-hours contracts. That is the problem. We must not mix up the arguments along the way, because there is positivity in some instances. The abuse is what the Government need to crack down on.
Sheila Gilmore
The exclusivity of zero-hours contracts is one issue, but it is not the only way in which they exploit people. A constituent of mine is a care worker who has to wait for a weekly text message telling her what hours she will be working at the end of that week. She has no choice either. The arrangement is causing severe problems in terms of her personal cash flow and her ability to obtain benefits and pay her rent, and, of course, it is also having a severe effect on the quality of the care that is being provided.
Alec Shelbrooke
I do not disagree with a single word of what the hon. Lady has just said. It is absolutely true, and that is why it falls to this place to start looking at the way in which employers have been abusing a flexibility which does work for certain people.
When I was between contracts and doing manual labour, did I want to be wondering whether I would have a kitchen or bathroom to fit in the following week, or did I want a constant supply of work? The fact is that I could not demand that the work would be there. I could not say, “Sorry, Mr Shelbrooke, you will be on a permanent contract whether the work is there or not.” There must be flexibility, but what we must legislate for is stopping the abuse. That is what my party is trying to do now, and my hon. Friend the Minister is working to address these very issues in his Small Business, Enterprise and Employment Bill.
Let me now deal with the minimum wage, which, after all, is what the debate is mostly about. I want to go further than our £12,500 tax threshold. My hon. Friend said that people in full-time work who are paid the minimum wage would not pay tax, but I want to maximise the benefit. If anything, I am a politician of aspiration. I want to make sure that someone who wants to work 42 hours a week, 52 weeks a year, will not have to pay any tax. That gives us a figure of £14,196 at today’s minimum wage rate, and that is my ambition. It is not a new policy. We have seen members of a newly formed political party leap up and say that they want the threshold to be raised to that level. Let me remind them that, back in the 1980s, Nigel Lawson said that no one should be taxed until their income had reached the rate at which it was not necessary to give the money back to them. That is the really important point when we are talking about how we can empower people. We must ensure that they have not only the motivation to go to work but the ability to keep the money they earn. If we have a minimum wage, surely we have to have minimum taxation. That taxation should not start until people start to earn more than the minimum wage full time. That is my ambition for this Government. Yes, I am delighted with our policy regarding £12,500 but I personally would like to go further.
The Opposition Front-Bench spokesman, the hon. Member for Streatham (Mr Umunna), said that there was not enough certainty in our policies. He made a good, considered opening speech but when he was pushed on the detail of where the 10% tax threshold would come in, he had no answer. That worries me. I worry that the policy of increasing the threshold from £10,500 to £12,500 would involve people paying 10% tax. We do not know whether that is the case; the policy is not there. I accept his argument that he cannot answer the question today, but this worries me none the less. I am worried about what these policies on wages for the lowest-paid workers actually mean. I worry that these policies could be inflationary if they are not carefully considered.
Cost of Living
Debate between Alec Shelbrooke and Sheila Gilmore(11 years ago)
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Alec Shelbrooke (Elmet and Rothwell) (Con)
This is indeed a very important debate. We can hear stories from any part of the House about the struggles that our constituents are going through. Indeed, constituents who one might deem to be on very good salaries are struggling, too. Whether someone is on a good salary or unemployed, if they are on a fixed income—including even those on good salaries who have had them frozen—a rise in the cost of living has a direct impact on their lives.
We must recognise the things we have to try to do to change the situation for the long term. Unemployment in my constituency has reduced by 32% since the Government came to power. We should welcome not only that reduction but the transfer of jobs from the public to the private sector, as quite a few small industrial bases in my constituency are supplying those jobs. As the economy is now turning a corner, growth in the economy and in the productivity of companies will allow wages to go up in line. What I do not support is a false rise in wages.
The minimum wage is very important; it ensures that people are not exploited, and as the Prime Minister outlined earlier today, if companies are found to have broken the minimum wage legislation, they will be fined a huge amount of money. We hope that will crack down on some of the more ruthless employers. We talk about a living wage—we would all hope to achieve a living wage—but it should not be specified in statute. By increasing wages falsely—in London, by 40%—we ensure that a living wage is always just out of reach.
Sheila Gilmore
I wonder whether the hon. Gentleman remembers that exactly the same arguments were advanced, mainly by members of his party, before the minimum wage was introduced. We were told that jobs would be lost—that it would be a terrible thing—but those predictions did not come true, so perhaps the hon. Gentleman is exaggerating his case.
Alec Shelbrooke
I am most grateful for the hon. Lady’s intervention because she makes the point that I wanted to make. I did not say that the living wage would cost jobs; I said that it would inflate wages. Many would argue that a lot of people already earn the living wage, and that a statutory living wage would benefit all those underneath. But we are all well aware how many people, especially our friends in the unions, would demand a 40% pay rise if it was to go through.
Ultimately, there is nothing to be gained by inflating wages artificially, as we did in the 1970s. I remember my parents telling me that when they were teachers in the 1970s, they got a 25% pay rise when Harold Wilson came to power in 1975 but it was worthless the following year. The goal is always slightly out of reach. We must tackle the cost of living, and ensure that people’s real wages and real net income can advance to meet it.
The Economy
Debate between Alec Shelbrooke and Sheila Gilmore(13 years, 6 months ago)
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Alec Shelbrooke (Elmet and Rothwell) (Con)
I want to start by putting an end to the myth that the Government have no mandate for the action they have taken. [Interruption.] Already I can hear somebody saying from a sedentary position that there is no mandate. Let us look at the figures. I do not think anybody in the House would deny how unpopular the Conservative Government of 1997 were. That led to the Labour landslide. I therefore wonder how the Labour party managed to take an even lower share of the vote in 2010 than the Conservative party took in 1997.
We went into the last general election saying that we would get the budget and the deficit under control, and that we would introduce welfare reform. Everybody heard that message, not least because the Labour party kept delivering leaflets to everybody’s houses saying that we were going to do those things.
Sheila Gilmore
I do not dispute that the Conservative party went into the election with those things in its manifesto. The point is that the Conservative party did not secure a majority and its coalition partner went to the electorate with a completely different prospectus.
Budget Responsibility and National Audit Bill [Lords]
Debate between Alec Shelbrooke and Sheila Gilmore(13 years, 10 months ago)
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Sheila Gilmore (Edinburgh East) (Lab)
I seem to be fated—this is the second time in two weeks—to be the last Back Bencher to contribute to a debate. Tempted though I am to continue to speak until as close to 10 pm as allowed by the need for wind-up speeches, I shall resist temptation—I can see my colleagues’ looks of horror. For those of us who are far from home and whose potential valentine is 400 miles away, we have nothing better to do than speak in this debate.
More seriously, it will be useful to have independent forecasts; indeed, it already has proved useful. In the short life of the Office for Budget Responsibility we have seen some figures that even this Government, who have professed a desire to be transparent, might not have been too happy about. Several of my hon. Friends have referred to figures such as the forecasts for unemployment and for economic growth. Had it not been for those reports, the Chancellor and other members of the Government might have been tempted to be a little more optimistic and gung-ho. We saw a little of that even last year when some Ministers talked about economic growth in the second and third quarters. We might have thought that everything was now motoring forward, but the OBR was able to tell us that that was not quite the case. The OBR’s forecasts may not always be palatable, even to the Government who have set it up.
I appreciate, Mr Deputy Speaker, that you have not wanted people to discuss the economy generally, but it was clear from the context in which this debate was put by the Economic Secretary that we cannot entirely avoid doing so. She made it clear that the OBR’s remit is determined by the Government’s view of the economy and what needs to be done to deal with it. She said that deficit reduction was the priority and the context for the OBR, but the question of how to do that remains. How do we reduce the deficit, how fast, and what are the implications of reducing it too fast? The Opposition believe that the actions that have been taken in order to fit the framework set for the reduction of the deficit in this Parliament may be counter-productive. The deficit may in fact rise, because if unemployment rises, demand falls and the economy does not grow, tax revenues will fall even further—and that was part of the reason for our current position. If that happens, we will see the deficit grow.
Alec Shelbrooke
As the hon. Lady has said, the OBR will indeed stop a Chancellor saying, “Growth is going to be this amount, and therefore I will borrow this amount,” while knowing full well that growth might not be so high and he might not be able to repay it. Surely that was the problem in recent years, and it is hoped that the OBR will stop such mistakes from being made again.
Sheila Gilmore
Our views of when it is appropriate to borrow and what the Government should do about the economy are clearly different. Emotive words have been used in this debate, including the term “mountain of debt”. Coalition Members are fond of saying that interest payments on borrowing are wasted. They are also fond of domestic analogies, and we hear a lot about the national credit card being maxed out, but there is another domestic analogy that we might use. When we pay our mortgage payments, we do not say that that is money wasted—it is money being invested for the purpose of acquiring a home.
When I was the convenor of housing for Edinburgh city council, 40p in the pound of tenants’ rents went on debt repayment. Sometimes the local newspaper and council opposition members would say, “This is terrible mismanagement”, but it was not mismanagement—it was an investment in building homes over many years and improving homes with such luxuries as central heating and double glazing.
Finance (No. 2) Bill
Debate between Alec Shelbrooke and Sheila Gilmore(14 years, 2 months ago)
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Sheila Gilmore (Edinburgh East) (Lab)
In the course of the debate, yet again, we have heard an awful lot of myths and legends. One of the biggest of those is the notion that because the Opposition have a different view of the economy, we are deficit deniers. You do not have to be denying a deficit to hold a different view of how it arose and the background circumstances, and a different view of how we get out of the situation that we are in. That is quite reasonable.
It is healthy that we have politics within which there are different viewpoints. The proof of the pudding will be apparent in a few years. If you are right, I will have to eat my words. I do not believe that those on the Government Benches are right, but we cannot tell just by throwing words at each other. It is not correct to say that somehow the Opposition hold the view that there is no deficit. That would be plain nonsense.
There are other myths and legends that we have heard today. One, which we heard from the hon. Member for Northampton South (Mr Binley), is that the previous Government were guilty of not mending the roof when the sun shone. We hear that repeatedly. If building schools, hospitals and roads was not mending the roof, I do not know what it was. If by that Conservative Members mean that we should have saved the money and put it in a reserve somewhere, that may be a legitimate criticism, but to suggest that we were not investing in the country’s infrastructure is plain wrong.
The hon. Member for Northampton South also suggested that the economic crisis was entirely our fault because of light-touch regulation. I may have been asleep through the years of the Labour Government, but I always thought I heard Conservatives saying that there was too much regulation, that we were the party of red tape and regulation, and that we over-regulated not just financial services, but everything. We heard an excellent maiden speech from the hon. Member for Skipton and Ripon (Julian Smith). Although I disagreed with the entire political content, it was a good speech. The hon. Gentleman said that in his view there was too much regulation.
It is easy to say with hindsight that there should have been more regulation of the financial services industry, for example. I believe that there should have been, but when people say that we were over-regulating the economy, that is one of the myths and legends.
We are told that we do not want to leave our children and grandchildren in a big financial mess by not paying off debt, but equally, and perhaps more importantly, do we want to leave our children and grandchildren in the position that generations have been placed in by previous economic failures, by destroying jobs and creating long-term unemployment in various parts of the country? I do not want to leave that to my children and grandchildren.
We are allowed to differ and to hold different points of view and different economic theories. The difference is not about whether there is a deficit, but about how we got into the present situation and how we get out of it.
The previous Government managed to stop the rise in unemployment reaching the levels that had been predicted. That was the cause of economic stimulus. Far from the deficit spiralling, as we heard earlier from the hon. Member for Stratford-on-Avon (Nadhim Zahawi), the deficit did not rise as much as had been expected. Therefore, we were not in some sort of new crisis—that is what has been suggested—which justified an emergency Budget which had very little in it. The Finance (No.2) Act 2010 that we passed in a great hurry before the summer also had very little in it, and we lost an opportunity to make some important changes.
The public and private sectors are inextricably linked, and slashing jobs in the public sector will further reduce the tax-take, increase the demand on benefits and, in itself, increase, not decrease, public borrowing and the deficit. Equally, reducing our investment in infrastructure—not stopping it entirely, but reducing it more than we need to do—will ultimately put us in a more difficult position.
Just last week I visited two constituent households at their request. The problems that they asked to see me about had nothing to do with jobs; nevertheless, by no coincidence in both households there was a working-age construction worker who was desperate to work but could not find any in my city. One said that the last job on which he had worked was now a complete university building in the city, but we will not see much more of that kind of building by our educational institutions. He is very keen to work, but the jobs are simply not there.
Alec Shelbrooke
Everybody would like to see that investment, but, and this is the point that I tried to make in my speech, the previous Chancellor would also have cut the capital budget. I talk about deficit deniers because I do not understand how you can ask for capital investment to carry on when your shadow Front Benchers would, as I understand it, follow that plan to reduce the capital budget.