Jobs and Work

Gareth Thomas Excerpts

Wednesday 11th June 2014 Commons Chamber

[Mr Umunna]

The hon. Gentleman raises a good point, because 22% of employees in his constituency under this Government are paid less than a living wage. I will come on to what we intend to do and what is so sorely lacking in the Queen’s Speech.

We do not want to wait until a Conservative Chancellor sees the light and matches our ambition in 2084. What we are hoping is that in the Queen’s Speech, and the Bills that follow, he will match our commitment and ensure that we have a better-waged economy. There are two parts to this challenge: first, action to tackle low pay and insecurity at work—I will come on to what the hon. Member for Dover (Charlie Elphicke) talked about—and, secondly, the implementation across Government of an industrial strategy to nurture and grow the sectors that produce the better-paid jobs we want to see across the country.

On low pay, we make no apologies for reminding the House at every opportunity that it was this party, in the face of strong opposition, that introduced the national minimum wage. When we entered office, some people were earning as little as £1 an hour, a practice I am proud to say we outlawed. To give just one of the many examples of the opposition we faced, when we introduced the national minimum wage into this House 17 years ago, a member of the then shadow Cabinet said:

“If, as I and all my Conservative colleagues believe, the DTI’s minimum wage comes into effect, it will negatively affect, not hundreds of thousands but millions of people.”—[Official Report, 4 July 1997; Vol. 297, c. 526.]

That shadow Cabinet member is now the Work and Pensions Secretary. We had the good sense to ignore him.

[Mr Gareth Thomas (Harrow West) (Lab/Co-op)]

On low pay, is my hon. Friend aware of allegations that several UK parcel carriers, namely Hermes and Yodel, are using so-called lifestyle couriers and effectively paying less than the minimum wage to the staff they use?

[Mr Umunna]

I thank my hon. Friend for that intervention. I was not aware of that, but I am sure the Business Secretary has heard what he said and will no doubt ensure that his Department looks into those two firms.

We have to build on the national minimum wage. Many Members, for example my hon. Friend the Member for Wansbeck (Ian Lavery), have argued for us to do so. It is currently £6.31 and is due to increase to £6.50 in October, but that is just 53% of median hourly earnings. We want to set—this in part relates to the point raised by the hon. Member for Dover—a more stretching target for the minimum wage for each Parliament, within the Low Pay Commission framework, to increase it faster than average earnings, while retaining capacity to take account of shocks to the economy. We would also give local authorities new powers of inspection and enforcement of the minimum wage, alongside central Government, to ensure it is enforced properly. We would also increase fines for non-payment to £50,000.

A number of measures are contained in the small business, enterprise and employment Bill. We are told, among other things, that the Bill will strengthen UK employment law by tackling national minimum wage abuses. It does not appear, however, that the Government will come close to matching our commitments to strengthen the national minimum wage. There will be no stretching target, no enhanced role for local authorities and much lower fines than we envisage. We will be pushing the Government to adopt our package during the passage of the Bill.

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[Vince Cable]

Although the situation is improving in Northern Ireland, there are significant unemployment black spots. I want to work with the Northern Ireland devolved authorities to make sure that we deal with them systematically. As the hon. Gentleman knows, this is a long-standing problem in Northern Ireland that goes back long before the recession.

[Mr Gareth Thomas (Harrow West) (Lab/Co-op)]

I raised previously allegations concerning a number of UK parcel carriers and minimum wage enforcement. Will the Secretary of State undertake to look at whether the minimum wage is being properly enforced by UK parcel carriers? Apart from the justice issues for the individuals concerned, there is the potential to affect the sustainability of the universal service obligation that Royal Mail is under.

[Vince Cable]

Certainly, if there is abuse of the minimum wage, we will want to know about it and we will investigate it. Liberalisation and the opening of the market was mandated by the European Commission some years ago, and it was implemented by the last Government, and we are now seeing the consequences in terms of pay and conditions.

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[Caroline Lucas (Brighton, Pavilion) (Green)]

I have tabled a reasoned amendment to the Gracious Speech because I do not believe that the legislative programme set out for this Session of Parliament puts us on track to either a stable economy or a fairer society, or for that matter a world of better quality jobs. That amendment calls for fair pay for work through a national living wage and maximum pay ratios. It calls for an end to the privatisation of public services and much else besides, but the focus of my comments today will be on the Infrastructure Bill, because one of the main benefits of that Bill is supposed to be job creation.

Of course we need more jobs, but high-carbon investment in new roads and shale gas is not the way to deliver that. There are far more job opportunities in a zero-carbon economy than in the fossil-fuelled economy that it replaces. Indeed, there are already more jobs in the green economy than in the motor and telecom sectors combined. The renewable energy industry in the UK today is a case in point, and supports over 100,000 jobs. That is not a fantasy, eyebrow-raising assumption. It is what we have today: actual jobs all across the UK—and that is without even taking into account future potential.

In 2013 approximately 14,000 full-time jobs were associated with the nation’s solar PV sector alone. That is pretty impressive, especially given that there were an estimated 10,000 job losses in the solar industry as a direct result of the coalition’s cack-handed cuts to feed-in tariffs. These losses have been partially offset by continued job creation in the wind industry: again, many of these will be despite anti-jobs, anti-investment policies from the coalition.

Solar is the most popular energy technology in the UK. Solar PV is also a way for individuals and communities to generate their own clean power, reducing dependence on the big six energy companies, and cutting energy bills. In April this year, two schools in Brighton switched on their solar panels.

[Mr Thomas]

Will the hon. Lady give way?

[Caroline Lucas]

I am sorry, but there is not time.

As I was saying, in April this year two schools in Brighton switched on their solar panels, while Brighton Energy Cooperative is in the process of raising funds from local people for its fifth large PV system. Yet the Government are now cutting support for large-scale solar, harming jobs and denying communities the opportunity to generate their own power from solar farms in the future.

Commenting on the UK slipping down the ranks of the renewable energy country attractiveness index for the second time in a row, to sixth place, Ernst and Young’s head of environmental finance says:

“Policy tinkering and conflicting signals once again become too much for investors and developers to handle.”

In other words, this Government’s policies are anti-jobs and anti-business, as well as anti-safe as far as the climate for our children and grandchildren is concerned.

The “global race” we hear so much about is getting more competitive. By early 2013, 138 countries had renewable energy targets. This Government are blocking such targets. Some 20 countries had renewable heating and cooling targets, too; we do not. Compared with other countries’ industrial strategies and coherent policy and incentive frameworks for home-grown renewables, the UK is looking pretty poor.

So what sort of policies would we be seeing if we had a pro-jobs Government who were serious about these opportunities and willing to stand up to the vested interests of the fossil-fuel industry, whose business plans are incompatible with a safe climate? We would see the confirming and strengthening of the fourth carbon budget. We would see the ditching of the irrational crusade against a binding 2030 renewable energy target. We would be giving the green investment bank powers to borrow now in order to leverage in the large proportion of private sector investment that is needed for the UK’s low-carbon economy to flourish. And we would be redirecting at least some of the billons of fossil fuel subsidies into renewable energy. We need a just transition—I particularly welcome the work that many unions have been doing on exactly how we will re-skill workers currently employed in high-carbon sectors—but it needs to happen fast. The point I want to illustrate is that the supposed conflict between tackling climate change and creating jobs is simply a political construct that suits incumbent fossil-fuel interests and very few others.

With thousands of people dying every winter because they cannot afford to heat their homes, energy-efficiency should be the No. 1 infrastructure priority for the UK. Hundreds of Brighton residents have written to me in support of the Energy Bill Revolution campaign, which calls for the Treasury to recycle carbon taxes into a national programme of energy-efficiency to ensure that homes need much less energy to heat, so that we have lower bills, carbon savings and, significantly, huge job-creation potential. We could add to that list NHS savings and, fundamentally, an end to people dying prematurely of the cold in winter. A report by Cambridge Econometrics last year found that a nationwide programme to super-insulate 600,000 UK homes a year would create more jobs than any alternative investment or tax break the UK could possibly put in place. So, this Gracious Speech is going in the wrong direction in terms of the economy, the environment and, crucially, jobs.

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[Mr Gareth Thomas (Harrow West) (Lab/Co-op)]

One of the critical drags on the creation of decent, well-paid jobs is the continuing difficulty experienced by both small businesses and ordinary households in gaining access to affordable credit. I wait with interest for details of the measures in the small business Bill, but I fear that they will not go far enough.

A number of United Kingdom-based experts with knowledge of small business lending have suggested that part of the problem is the wide disparity within and between different parts of the UK in obtaining access to business finance. For years, as a result of a package of legislative measures known colloquially as the Community Reinvestment Act, banks in the United States have had to disclose where they are lending by postcode and the type of lending that they offer and to demonstrate, to secure banking licences, that they are offering a service in all the areas from which they take deposits. There is also organised scrutiny of the data that they disclose, so that policy makers can locate the gaps in access to credit. In parts of America where lending is low, banks work closely with alternative lenders of finance such as community banks to address the shortage. In the absence of a similar regular disclosure of lending data, the Government, local enterprise partnerships, local authorities and community banks in this country are working with one hand tied behind their backs in trying to understand where further support is needed to provide proper access to credit.

It is true that in January, following sustained pressure from Members in all parts of the House, banks published data showing lending to businesses and personal lending by postcode, as a one-off, but I understand that no organisation has yet received funds that would enable it to carry out a comprehensive examination of those data, and it is not clear how regular further lending data disclosures will be. There is no legal requirement for UK banks to release such data—it is still voluntary—but I hope that we may yet see such a requirement in the small business Bill.

Concern about lending to businesses is mirrored by concern about the existence of lending deserts in personal finance. The number of bank branch closures has increased over the past four years, and, as we heard from my hon. Friend the Member for Sheffield Central (Paul Blomfield), a growing number of communities with no bank or alternative banking facilities are being forced to turn to high-cost sources of credit such as payday lenders.

I asked the Financial Inclusion Centre to take an initial look at the lending data for London. It concluded that there did appear to be a postcode lottery, with significant variations between levels of lending. There are, for example, areas of London in which lending to small and medium-sized enterprises drops to between a quarter and a third of the London average. A better understanding of the differences in personal lending between communities might help to ensure that efforts to expand credit union coverage and membership were directed more effectively. I should have liked the Queen’s Speech to contain further measures to accelerate awareness of credit unions as a cheaper source of personal credit. The inclusion of a clear cross-Government target of increasing the number of members and enabling local authorities, housing associations and employers to encourage credit union membership might have been useful. Similarly, a legal right to allow employees to have deducted at source a small part of their income for saving with a credit union would have been helpful.

I am disappointed that there are no measures in the Queen’s Speech to tackle the growing crisis in the NHS. In my constituency, there are problems at Northwick Park hospital. Our A and E department is under significant pressure; it is one of the worst in terms of meeting the target to see 95% of A and E patients within four hours. My constituents are inevitably worried about the Government’s decision to close the nearby Ealing hospital A and E department and about the disclosure that the hospital board thinks that an additional 123 beds are needed on the Northwick Park site to deal with the pressures. I have not yet seen any evidence that the Government will meet the demand for finance to deal with that issue. I hope that that will be corrected soon.