Alison Seabeck
Main Page: Alison Seabeck (Labour - Plymouth, Moor View)Department Debates - View all Alison Seabeck's debates with the Cabinet Office
(12 years, 5 months ago)
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Alison Seabeck (Plymouth, Moor View) (Lab)
As with so much of what this Government are doing, the proposal that we are discussing is tainted by their incompetence and their inability to think things through and fully understand—or, indeed, accept—the perverse outcomes that will result. We have seen it with council tax benefit, housing benefit changes and the rushed strategic defence and security review.
Despite the view commonly held, the south-west has serious poverty. There was a reason why Cornwall had objective 1 status and is a convergence area. Plymouth had the poorest ward in the country in the 1990s. We may not have the dark satanic mills of the north, but there are certainly massive disparities in wealth, which will be further exacerbated should this proposal be rolled out nationally.
The Minister mentioned the previous Government’s consideration of differential pay rates. Indeed, the coalition seems to be clinging to that argument and using it as a security blanket, an excuse for its attempt to take this proposal further. The idea was not extended beyond the Court Service, and there are clearly good reasons for that.
Alison Seabeck
No, sit down. You’ve had your opportunity.
There are other historical examples of this policy. In the 1990s, the Conservative Government asked the NHS to look into the subject, but after a year’s work, it could find only a 0.1% variation between the regions. That was not the best way for the NHS to spend its time and money.
Gemma Doyle (West Dunbartonshire) (Lab/Co-op)
Will my hon. Friend give way?
Alison Seabeck
I thank my hon. Friend for her intervention. She is not going to have an opportunity to make a speech, owing to time constraints, but I am sure that the Scottish people will have heard her comment.
Median pay in the south-west is already £14 a week less than the national average. Many of the public sector workers there have also been the subject of pay freezes, pay caps or pension contribution increases, all of which have reduced their spending power. Plymouth is a city that is heavily dependent on the public sector; the hospital is the largest employer. There is real concern there about the damage that a decision to reduce wage levels in the region, or locally, could have on an economy that is just about keeping its head above water.
Shabana Mahmood (Birmingham, Ladywood) (Lab)
We have heard a lot about the private sector from Government Members, but does my hon. Friend believe that it would be instructive to note that many large national private sector employers have pay bargaining practices that are not dissimilar to those of the public sector?
Alison Seabeck
Indeed; I shall touch on that point briefly later.
More than 18,000 people in Plymouth work in the public sector. In my constituency, a massive 25% of the working population do so—one in four people—and to dampen pay rates could be devastating. The Government’s suggestion that it is easy to compare private sector and public sector jobs is absolute nonsense. In the south-west, large swathes of people work in the hospitality and agriculture sectors, earning very low wages. There is no simple read-across, and I would ask the Government to consider that fact carefully.
Alison Seabeck
No, I am afraid that I cannot. Perhaps one of the hon. Gentleman’s colleagues will allow him to intervene on them later.
In his autumn statement, the Chancellor talked about private sector pay being set in accordance with local labour markets. That is not true. As my hon. Friend the Member for Birmingham, Ladywood (Shabana Mahmood) has just pointed out, some of the most successful companies in the country, including large retailers, banks and telecoms companies, use similar national pay structures.
There is genuine concern among businesses in my constituency that any decision to cap or lower public sector pay will lead to problems for them, in that there will be less demand for their goods and services as families pull in their horns.
Alison Seabeck
I am afraid not; my hon. Friend has only just arrived in the Chamber.
A representative of one business has commented to me:
“As I see it, the lot in power have proved that they don’t get reality.”
Because the south-west is very beautiful, we have a large number of second homes. They push the cost of housing up to levels on a par with those in the south-east, but our salaries are lower and so the mortgage multiplier for our potential homeowners is astronomical. That can be crippling for people desperate for a home; the effect is felt not only in Plymouth but in the rural south-west. That point was well made by my right hon. Friend the Member for Exeter (Mr Bradshaw).
In the South Hams, the house price to income ratio is around 17:1. In the Cotswolds, it is even higher, at closer to 19:1, and those figures were taken at the depth of the recession in 2010. We should remember that many of the public sector workers who work in Plymouth and Exeter live in areas such as the South Hams. They might have struggled to get a mortgage on their dream home in better times, and they will be disproportionately hit by this Government’s proposals on regional pay. The housing market will not allow them to sell their home and move—I am sure that my hon. Friend the Member for Birmingham, Erdington (Jack Dromey) was going to make this point— particularly when new affordable homes are not being built. What are those people to do, when their pay is either cut or frozen and meeting their mortgage payments becomes increasingly difficult? They will stop spending in local shops, hotels and pubs, and on entertainment. That will provide a direct hit on the local economy.
This was a complex matter for the NHS to consider all those years ago, and I urge the Government to be aware of the complexity of boundaries and of the additional costs involved in the work required to ensure that the proposal is consistent and does not lead to poaching or leapfrogging. They are on a hiding to nothing on this one; it will create anomalies and provide yet another example of their incompetence. Every time this happens, however, it is not the Chancellor or the Paymaster General and his mates who are affected, but low-paid working people such as teachers, nurses and midwives.