Economic Prosperity and Employment

Baroness Turner of Camden Excerpts

Thursday 18th July 2013 Lords Chamber

[Baroness Turner of Camden]

My Lords, I thank my noble friend Lord Haskel for introducing this debate and for the way in which he did so. Of course, the Government have a major role in generating prosperity and the employment prosperity should promote. The problem is that, as many of us see it, the present Government appear to believe that it all should be left to market forces, even though experience indicates that this is mistaken. We are told that there are “green shoots” and that things are improving, but I have doubts about that. Living standards are continuing to fall. Vital benefits are being cut or frozen. Housing is in crisis, particularly in London. I have said repeatedly in this House that rents are too high and wages are too low.

It is said that employment opportunities are improving. Only a little, it seems to me, and not for young people—or older. Those over 50 have great difficulty getting other employment if they are made redundant. All this indicates that the Government’s policies are not working, and we have yet to feel the effects of the public service cuts due to come onstream in the autumn.

Meanwhile, the Government are proceeding with their policy of cutting back employment rights. Access to tribunals is being made more difficult and will now be charged for. Changes in the law will make it more difficult, if not impossible, for an injured worker to claim compensation. Whistleblowers intent on drawing attention to dangerous situations are to lose some protection. The ridiculous scheme—defeated in this House but endorsed by the Commons—whereby workers can give up all employment rights in return for shares has nevertheless been introduced by the Government, although I think without much success. The Government seem to believe that all this will increase employment opportunities. I do not think so. The Government should understand that an enthusiastic, committed and well paid workforce is a major asset. SMEs have already benefited from a low-paid workforce, and this has not produced an economic revival: quite the contrary.

The role of the unions should not be underestimated. My own union has recently drawn attention to the work being done in the automotive industry, which is currently very successful. There is an industry committee, on which unions participate. The union has drawn attention to the very successful arrangements in Germany where the workforce is involved through workplace committees. Unions are not enemies, although some newspapers insist that this is so. Their contribution in the field of education and training should be encouraged and respected. The TUC programme, Unionlearn, is well known and successful.

Investment, however, is of course the key. There are many areas of the country which were once thriving but where the factories and workshops which once employed the local population no longer exist. As a result, the local economy is stagnant. There is a need for area development. It is now generally agreed by speakers in this debate this afternoon that our economy needs to be rebalanced; we cannot rely just on financial industries, which we have done in the past. There needs to be an investment bank under government direction so that appropriate investment can be made.

None of this will be easy, but current policies are making things worse, not better. Inequalities are becoming wider—a small minority is rich but others are much poorer. It is time to review current policies.