Leaving the EU: Workers’ Rights

Hugh Gaffney Excerpts

Tuesday 29th October 2019 Commons Chamber

[Andrea Leadsom]

Yes, my hon. Friend is exactly right.

[Hugh Gaffney (Coatbridge, Chryston and Bellshill) (Lab)]

The Tory party talks about protecting workers. Thomas Cook: no say and no pay. Asda: sign or resign. Royal Mail: agreements made but not honoured. Where is the intervention from the Tory Government? They will further weaken workers’ rights after Brexit, including on health and safety. Why is there no legal protection for existing workers’ rights in the withdrawal agreement?

[Andrea Leadsom]

The hon. Gentleman is not correct. There are protections for workers’ rights in UK legislation. As I have explained to many right hon. and hon. Members, the UK’s protections and rights for workers go far beyond any of the EU’s minimum standards. We are proud of that fact and have every intention of further enhancing those rights.

Rural Areas in Scotland: Additional Delivery Charges

Hugh Gaffney Excerpts

Tuesday 2nd July 2019 Westminster Hall

[Douglas Ross (Moray) (Con)]

It is a pleasure to serve under your chairmanship, Mr Hollobone. I give my genuine and heartfelt thanks to the hon. Member for Caithness, Sutherland and Easter Ross (Jamie Stone) for securing this debate. I am both delighted and frustrated that we are here again to debate this matter—delighted because a Minister will respond to the concerns of MPs representing their constituencies across much of the north of Scotland, and frustrated because it is not the first time the hon. Gentleman has raised this issue, nor is it the first time I have raised it.

Since mentioning this matter in my maiden speech two years ago, I have mentioned it at Prime Minister’s questions, held a 90-minute Westminster Hall debate, raised it at Business questions and suggested that the Scottish Affairs Committee hold an inquiry into it, which it did. This matter has been raised many times, on the Floor of the House, in Westminster Hall and in our Committee Rooms. I have also met with the Minister a number of times to discuss this matter.

The issue of excessive and rip-off delivery charges affects not just the highlands of Scotland, but the whole of my Moray constituency. It is absolutely incredible that in 2019—in this day and age—couriers and companies still say that Moray and the highlands are not part of mainland United Kingdom. I do not know how many times we have to say this to get the message through, but they seem blind to the fact that Moray, the highlands, the north-east and other parts of Scotland are part of the mainland United Kingdom. One does not need to take a plane to get to Elgin or Caithness; it is all joined together as part of mainland UK and it should be treated the same.

[Hugh Gaffney (Coatbridge, Chryston and Bellshill) (Lab)]

At this point I want to congratulate the postmen and parcel people who work for Royal Mail and deliver six days a week to all areas, in all kinds of weather. All we are asking for in Royal Mail is a level playing field. Some of these couriers are charging ridiculous prices. We can do it; all we ask for is a level playing field for everyone. I congratulate all the postmen who do their work there.

[Douglas Ross]

I am not sure whether the hon. Gentleman might need to correct the record. As a former postman, he should have declared his interest to the House. He is clearly still a part of that, as twice in a short intervention he said “we”. I say that in jest, because he brings great experience as a postman from before he was elected to this place. It is useful to have his contribution, because those workers undoubtedly do a service. However, we are really challenging the couriers’ add-on prices, as the hon. Member for Caithness, Sutherland and Easter Ross set out clearly in his opening remarks. Someone might go online, view a product, decide that they want it and agree the price, only to find an additional cost on top of that simply because the company believes that they live too far away to deliver the product easily.

Bank Holidays in 2020

Hugh Gaffney Excerpts

Tuesday 18th June 2019 Commons Chamber

[Derek Thomas]

I thank my hon. Friend for that intervention. The days that he has referenced are really good opportunities for MPs to take part in the commemorations that happen right across the country, which I enjoy. I make a point of taking part in them and taking my children along as well, so that they can learn about our great heritage and our great service.

[Hugh Gaffney (Coatbridge, Chryston and Bellshill) (Lab)]

I agree with what the hon. Gentleman says about the 75 years, and about the 50 years. I have been a trade unionist for 30 years, and the only day of action I took was for the bank holiday to remain as a traditional May Day bank holiday. It must remain. Give us the extra day for the 75, but the traditional May Day bank holiday on the first Monday of every May is for workers and trade unions, and it must remain as well.

[Derek Thomas]

That is the argument I will be making as I remind the House about the incredible event that took place on VE Day and explain why it is absolutely right that we set aside time to celebrate that next year, so that the whole of Great Britain can take part.

--- Later in debate ---

[Derek Thomas]

I am glad that I have support from around the House, because Adjournment debates are often poorly attended. I thank the hon. Gentleman for that intervention, and I completely agree with him. The Secretary of State announced the change to the early May bank holiday, and it was an enormous decision for large numbers of small businesses, for the tourism industry—which I particularly want to focus on—for the people who have already, for good reasons, booked their holidays next May, and for the people who have decided to use that weekend because they would be able to take their children away without interfering with their schooling.

I am disappointed that the Secretary of State himself is not here to respond to the debate, because the late notice of the announcement demonstrates a tin ear towards the tourism industry. For those in any doubt about the meaning of the expression “tin ear” and its use in relation to the Department’s attitude towards small businesses and many other people, it is defined as “a deafened or insensitive ear”. However, I want to make it clear that I do not include the Under-Secretary of State for Business, Energy and Industrial Strategy, my hon. Friend the Member for Pendle (Andrew Stephenson), who has been asked to respond to this debate, in that definition, because he has had nothing to do with it.

I received a letter from a businessman on the Isles of Scilly a day after the announcement, and he put his concern across much more diplomatically, saying:

“I have to say whichever government department decided at this late stage, 11 months before, to change the dates really does need to wake up to the realty of the holiday market. This change has the potential to create many upset guests unable to change their booked dates.”

I know that I am not alone in receiving correspondence and representations from constituents and businesses, and I have selected a few extracts that help to express the various implications of the decision being so late. One constituent asked the following question of the Secretary of State in an email to me:

“Have schools been considered in this late announcement about the changes to the May bank holiday? This will cause problems especially as holiday dates are already issued, residentials and school trips will have been planned, and this is the Friday before the important Y6 SAT tests”.

Another wrote:

“Hello Mr Thomas,

I have also been affected by the change of the bank holiday. I have booked my Hen Do”—

we have already had a reference to weddings—

“for the bank holiday weekend, paying more to go on these dates so that more people could make it as they wouldn’t have to take the day off work. As the date has now changed, people are not able to make my Hen Do, and I am forced to pay to cancel the holiday booked for us all losing over £1000.

I hope you can help in this issue by asking the government to not take away our original bank holiday date.”

Another constituent wrote to me to say:

“Dear Sir,

I am extremely pleased that VE day is to be celebrated as a priority in 2020.

However, I do not believe that the decision yesterday to change the date to 8th May 2020 provides a suitable length of time for the country to adapt.

My family are now left with the option of losing financially to cancel our annual May Day Bank Holiday as our children will be required to attend school.

The tourism industry is just one example where 11 months’ notice is not suitable.

I would expect that more foresight would have been given to this scenario.”

Someone who is not a constituent—I will leave the House to work out where they are from—wrote:

“Dear Mr Thomas

I understand you are bringing up the cancellation of the May day holiday in Parliament.”

A small group of us, they continue, organises

“the annual bikers’ event and May day Morris dancing in Hastings. It is by far and above the biggest weekend in the annual calendar. Not only will it affect our events badly, it will also be a massive blow to local tourist businesses who rely on that weekend after a hard winter and tell me it’s their biggest earner of the year...Currently, Morris dancers and bikers from across the country”—

this is something that we can all look forward to—

“are planning a protest at Parliament on July 23rd. This is something we would rather not have to do”—

although I think we would welcome it.

“We fully support a commemoration of VE Day, but we do not support having our events that have already been booked and paid for, plus all those who have already booked hotels, disrupted with so little notice.”

Returning to my constituency, many will know that the world gig rowing championships take place on the Isles of Scilly on the early May bank holiday every year. It is a momentous event in my constituency’s calendar, and it takes a considerable amount of time to get all the gigs over to Scilly. However, it is currently unclear what changes will need to be made if the Government stick to their decision. Moving on to other disruption that I am aware of, we have all seen the story in the national press about the small business that is set to lose £200,000 having just printed next year’s calendars.

I am sure the Government do not need me to say how disruptive this decision is given how late in the day the announcement was made. The only possible, practical and pragmatic response is for the Government to keep the bank holiday to commemorate VE-day and to reinstate the early spring bank holiday on Monday 4 May. I make it clear to the Minister, to the House and to business that I have no appetite to create extra cost and disruption for small businesses, and I have never previously supported the idea of extra bank holidays. However, the fact remains that the Department for Business, Energy and Industrial Strategy has left the decision far too late and has caused far too much disruption and potential expense to far too many people. The appropriate response must be for the Department to reinstate quickly the bank holiday on 4 May.

There is support for that proposal, which may not surprise the House. The British Beer & Pub Association sent me a letter:

“For clarity the BBPA does support the extra bank holiday that Mr Thomas is proposing. Based on the four-day bank holiday weekend for the Queen’s Diamond Jubilee in 2012, we predict that the extra bank holiday would provide a boost to Britain’s pubs and brewers, with an estimated 10 million extra pints sold. This would also support the taxman and the economy—the taxman would receive £4.5m in extra duty revenue and VAT and it would provide a £30m boost to the economy.”

All of us, particularly those of us with rural constituencies, know the importance of small rural village pubs and how such opportunities really help them to continue their business of providing a community hub and keeping an eye on those who are otherwise often left at home on their own.

[Hugh Gaffney]

The hon. Gentleman mentioned earlier that people book holidays for that weekend, and sometimes it is the only time that families get together because they have to work through the school holidays to keep a roof above their head. The UK has the fewest bank holidays in the G20. Does he agree with Labour, which wants to increase the number of bank holidays? Let us start next year with VE Day and then look at each country’s patron saint’s day.

[Derek Thomas]

The hon. Gentleman will realise that I do not fully support everything he has just said, but I support what he says about next year. That is the whole point of this debate.

We have left it too late. There is no question but that we need 8 May, but we should reinstate and keep the 4 May bank holiday, because that is what people have planned for, expect and, in many cases, have paid for. Tourism is a significant part of my constituency’s economy, and people have booked in advance because there has been real growth in staycations. People are staying in the UK for holidays, and Cornwall is obviously their No. 1 choice, particularly west Cornwall and the Isles of Scilly.

I have always maintained that I represent the most beautiful, precious and wonderful part of the country. If people have any concerns about their wellbeing, they should come down for a well-deserved rest and therapy. I hope I have been able to get that across in this short commercial break.

I agree about the extra bank holiday for next year, but I do not have it within me, as a former businessman, to impose further bank holidays, particularly on small businesses, unless there is a good reason to do so and the Department handles it much better than it has on this occasion.

The British Beer & Pub Association’s letter continues:

“Furthermore, the BBPA have already called on the Government to grant extended hours to pubs, so pubs can make the most of the celebratory weekend.”

That is what happened 75 years ago, and I hope the Government follow suit.

In summary—I am reluctant to keep people away from any activity they might want to pursue in the beer industry later this evening—I have no appetite to create further cost and disruption for small business. That is clear, and I spend my time trying to do what I can to support small businesses. In fact, I have spent a lot of time over the past four years arguing that the Government should improve the lot of small business by simplifying the tax system—scrapping business rates, for example—creating training opportunities and ensuring that businesses have affordable access to credit.

I have a record of wanting to support and promote small business, and I am not one to disrupt it any further, but I believe we should give the extra bank holiday on this occasion. The Business Secretary has given too little notice of the changes to the early May bank holiday. The Government should reinstate the bank holiday on 4 May and keep the planned bank holiday for 8 May that was recently announced to celebrate the 75th anniversary of victory in Europe.

I completely support the proposed bank holiday. The challenge for businesses, particularly in tourism, is that the Government have given just 11 months’ notice of this change, as if the 75th anniversary has come as some sort of surprise. I sincerely apologise to business, which can ill afford another bank holiday, but it is too late to scrap the 4 May bank holiday. The Government should reinstate it, and reinstate it quickly—hopefully in the next 15 minutes.

--- Later in debate ---

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Andrew Stephenson)]

May I echo your comments about the new Assistant Serjeant at Arms, Mr Deputy Speaker? I wish to start by congratulating my hon. Friend the Member for St Ives (Derek Thomas) on securing this important debate and on his interesting and informative speech, which covered everything from morris dancers to bikers. I also thank other Members for their interventions, particularly the hon. Member for Strangford (Jim Shannon), who never misses an Adjournment debate. I would be delighted to hear more about his expertise at bonfires. [Interruption.] Indeed, not in this building.

I share the views expressed in the House that VE Day is an important opportunity to reflect on the sacrifices of a generation. The Government believe it is important to commemorate the sacrifices made by our servicemen and women in the second world war on the 75th anniversary of VE Day, as we did for the 50th anniversary in 1995, when there were celebrations and street parties across the UK. My hon. Friend talked so eloquently about that.

Moving next year’s early May bank holiday to VE Day itself has been seen to be a right and fitting tribute to our heroes of the second world war. The sentiment of celebrating on VE Day itself cannot be monetised for the veterans who served in the war. The Government gratefully acknowledge the responsibilities that our country’s armed forces assume on behalf of the UK Government and our people.

[Hugh Gaffney]

While we respect the men who fought for us and gave us our freedom today, we must also remember that there is a traditional May Day. So this is not about moving it; it is about keeping both of them. Workers have a traditional May Day holiday, celebrated every year, in the exact same way as the men who went to war.

[Andrew Stephenson]

If the hon. Gentleman bears with me, I will come to address that point.

The sentiment of celebrating VE Day is something that everyone in this House would agree with. As well as marking the allies’ great victory in 1945, the bank holiday on Friday 8 May is an opportunity to pay tribute to members of the UK armed forces who have served and continue to serve our country to this day. On this historic occasion, the Government want to ensure as many people as possible have the valuable opportunity to pay a fitting tribute. This is part of a wider package of celebrations the Government have supported, including the commemorations to mark the 75th anniversary of D Day, which recently took place across the UK. The 75th anniversary of VJ Day is also a significant commemoration in its own right and will be marked appropriately.

My hon. Friend has been a consistent champion of the tourism sector, which thrives in his constituency, drawing from his own experience of running a small business. Since his election to this House, he has prioritised supporting small business owners. Having served as a district and parish councillor, he has shown a deep commitment to his local community through his work at Westminster. I recognise that the Government’s decision to move the bank holiday from Monday 4 May to Friday 8 May next year will have an impact on the impressive May Day festival in his constituency, which I believe dates back to 1573.

Tourism has driven development in my hon. Friend’s constituency over the past 150 years and is an essential part of the area’s day-to-day life, impacting significantly on the economic activity of the local community. An estimated 2,850 jobs in St Ives are supported by visitor-related spending and 42% of jobs directly depend on tourism, so I understand the importance of this sector to his local area. These celebrations will have others like them across the country, and reorganising them will be a real challenge. I hope that plans can be adapted during the next 11 months to ensure minimal disruption. I also hope that other events planned may benefit from the change; I particularly hope that the St Ives literary festival, which begins only a day after the VE Day bank holiday next year, will attract even more tourists, due to the long weekend.

As we have heard, there are additional impacts on other specific sectors and planned events throughout the country. As we are moving the bank holiday rather than creating an additional one, we anticipate that the overall cost to business will be relatively low, but I genuinely recognise that the benefits and costs will vary from area to area and from sector to sector.

[Andrew Stephenson]

I think I have read about that example in the newspapers. It is obviously a significant blow to that business and something that I feel is regrettable. I wish the decision could have been made in a more timely fashion and do genuinely appreciate the concerns expressed by firms throughout the country. As I shall say later in my speech, the impact on different sectors of the creation of an additional bank holiday, of which there would be even shorter notice, could have an even bigger impact on our economy and on some businesses. I appreciate some of the concerns expressed about this decision, but we need to strike a balance in our approach to the creation of additional bank holidays.

Let me reflect on some more of the points that my hon. Friend the Member for St Ives made about the importance of small business. First and foremost, we need to ensure that the decisions the Government take reflect the needs of small businesses, because small businesses are the backbone of our economy. In 2018, small and medium-sized enterprises accounted for 60% of UK private sector employment and had a combined annual turnover of £2 trillion. We try to support small businesses through my Department’s industrial strategy, and on an almost weekly basis I meet the Federation of Small Businesses and the British Chambers of Commerce to hear about their concerns and how we can best support them.

In May, the Under-Secretary of State for Business, Energy and Industrial Strategy, my hon. Friend the Member for Rochester and Strood (Kelly Tolhurst), who is responsible for small business, held the first ever small and microbusiness engagement call, to allow the Government to engage with hard-to-reach businesses. The next call will be on Monday, alongside the regularly scheduled SME advisory board meeting.

I appreciate what my hon. Friend the Member for St Ives said about the Department having a tin ear on this issue, but I reassure him that we regularly engage with businesses small, medium and large throughout the country. I have been in post for only two months, but in the past month I visited 22 businesses throughout the UK, from Kent to Derby and up to Burnley—I had to do some visits in Lancashire, Mr Deputy Speaker.

The Government are proceeding rapidly with discussions with the industry to deliver a tourism sector deal. Ten sector deals are currently part of our industrial strategy, and I very much hope that the 11th will be a tourism sector deal, which we hope to launch in the coming weeks. The deal will look to harness the opportunities that the UK has to offer and further boost our tourism sector.

My hon. Friend asked about parents having booked holidays on the date of the original bank holiday, which will now fall as a school term day. As I understand it, it is within the gift of headteachers to grant permission for children to be absent during term time, under exceptional circumstances. Given the rationale behind the moving of the bank holiday, a compelling argument could be made that the circumstances are indeed exceptional.

I accept that the decision will have a negative impact on some people, but moving the bank holiday remains a right and fitting tribute to mark such a watershed moment in our nation’s history.

[Hugh Gaffney]

Will the Minister give way?

[Andrew Stephenson]

Let me continue a little.

As my hon. Friend the Member for St Ives acknowledged, we all know the history: in Cornwall, 4,786 casualties were identified as the result of world war two, including the deaths of 54 sets of brothers and nine sets of fathers and sons. I expect that the people of St Ives will understand the importance of honouring those who served in the war, as my hon. Friend rightly said, and pay tribute to the brave people of Cornwall who served or laid down their lives in conflict.

In the light of the lateness of the decision, my hon. Friend asked the Government to create an extra bank holiday to avoid disruption. The Government regularly receive requests for additional bank and public holidays to commemorate a variety of occasions, such as cultural history and military and religious events. My ministerial colleague, the Minister for Small Business, took a House of Commons petitions debate introduced by the hon. Member for Linlithgow and East Falkirk (Martyn Day) relating to holding public holidays on religious occasions last year, in which the merit of bank holidays for important religious occasions, such as Eid and Diwali, was debated.

It is the duty of any responsible Government, however, to judge impacts on the overall economy and the economic impacts on all sectors. Although an additional bank holiday may benefit some people and some sectors—my hon. Friend made a good point about the benefit it certainly has for our pub sector—the cost to the economy of an additional bank holiday is considerable. The impact on the economy of the one-off bank holiday for the Queen’s diamond jubilee in 2012 was estimated at £1.2 billion. The cost falls heaviest on the manufacturing sector, with the burden being twice as big as that on the service sector. We need to take into account not just the fact that there are different impacts on different sectors—some gaining and others not—but the size of those impacts. The Government considered these issues carefully and it was judged that moving the bank holiday, rather than creating an additional one, is the most appropriate way on this occasion following the precedent set by the 50th anniversary.

Friday 8 May next year will be a valuable opportunity for people across the UK to take time to commemorate the historic occasion of victory in Europe and pay tribute to those who sacrificed their lives in the second world war on behalf of us all. I thank my hon. Friend for allowing me the opportunity to discuss the Government’s position on the significance of bank holidays in 2020.

Question put and agreed to.

Mineworkers’ Pension Scheme

Hugh Gaffney Excerpts

Monday 10th June 2019 Commons Chamber

[Danielle Rowley (Midlothian) (Lab)]

I swear that, for the past few times that I have spoken, the time limit has been reduced just before me, but I do not blame you, Madam Deputy Speaker.

It is truly an honour to follow my hon. Friend the Member for Blaenau Gwent (Nick Smith), who just gave such an emotional and personal speech. I thank my hon. Friend the Member for Easington (Grahame Morris) for his speech and for the debate as well.

I am honoured to represent a rich mining community, home to the Lady Victoria Colliery, which was Scotland’s first super-pit, with a workforce of almost 2,000 at its peak. It was nationalised in 1947 by a Labour Government who invested in working class communities. A thriving mining community grew up around this pit in Newtongrange and in other Midlothian towns which, like many other mining communities, have suffered since the closure of the pits.

The site of the colliery is now home to the National Mining Museum, which is a fantastic museum and events base. It ensures that the role and the national significance of the mining industry and the impact that it had on the lives of those who lived in mining communities are never forgotten, and yet mining communities are being forgotten by this Government. Their voices are being ignored and they are being unfairly and unjustly treated, as we have heard from all parties in this debate today.

We have heard about the average miner’s pension, but some retired miners and their widows are living on roughly £60 a week at the bottom, and that is just disgraceful—absolutely disgraceful. It has also been reported that at least 6,000 ex-miners have had their pensions cut, and that is despite the huge profits that are being made by the Government—an estimated £10 billion over the past 20 years under this current arrangement. At the time of the agreement, it was estimated that the scheme would generate a £2 billion surplus over 25 years, but, as we heard from some of my colleagues, that has been underestimated and there is actually more.

The amount given to ex-miners must be re-evaluated. The Government have been rewarded with huge undeserved sums and, as we have heard today, they are treating the mineworkers’ pension scheme as a cash cow. It was meant to be a safety net for miners, not a money earner for the Government. My hon. Friend the Member for Blaenau Gwent used a phrase that I thought was particularly illuminating. He said that pensioners were subsidising the Government. Is that not disgraceful?

The work of miners in Midlothian and across the country was integral to the development of the wealth of our country. Britain developed in part on the backs of miners, and we have to show our gratitude to them, we absolutely do. The miners’ work was very physically demanding and, as we have heard, it has led to many retirees living with associated health conditions.

I would like to take the chance to pay tribute to the Lothian miners’ convalescent home, Whatton Lodge, in East Lothian for all the work that it does looking after retired miners and their families. It celebrated its 70th anniversary recently. It does great work for miners in Midlothian and across the Lothian area.

I am glad to have been called to speak in this important debate. The hon. Member for Mansfield (Ben Bradley) talked about not even having been born when some of the pits were closed. I think that I just pip him on being a little bit younger. It is so important to have young voices from across the Chamber speak in this debate, because we must ensure that the voices of miners are not lost.

[Hugh Gaffney (Coatbridge, Chryston and Bellshill) (Lab)]

My hon. Friend is talking about young people. This year in my constituency of Coatbridge, Chryston and Bellshill, the Auchengeich miners commemorate 60 years since 47 miners died in a fire—paying the real price of coal. Their children grew up fatherless, with no money, and people are still suffering today. That is the real price of coal. The Government should give the money back to the miners.

Post Office Network

Hugh Gaffney Excerpts

Thursday 25th April 2019 Westminster Hall

[Hugh Gaffney (Coatbridge, Chryston and Bellshill) (Lab)]

I congratulate the hon. Member for Motherwell and Wishaw (Marion Fellows) on securing this debate. Before I became an MP, we stood together to fight for the Brandon Street post office in Motherwell. It was a very good Crown post office and well supported by the local community—even more so by the local shops, which got involved in collecting petitions. They did a very good job, but it was not good enough for the Post Office.

I want to make hon. Members aware of my entry in the Register of Members’ Financial Interests. I am currently on a five-year career break from Royal Mail, where I worked for 28 years before being elected to the House. I am a proud member of the Communication Workers Union, and I wish it all the best for its conference in Bournemouth next week. I welcome delegates in the Public Gallery, who are here to hear this debate.

Throughout my career as a postal worker, I have seen at first hand the clear benefits of having Royal Mail and the Post Office as a unified public service serving all communities across the UK. That is why I fought against the privatisation of Royal Mail for over 20 years. I resisted attempts by successive Governments to fragment and privatise postal services. However, the Tory-Lib Dem coalition was eventually successful in privatising Royal Mail in 2013. They sold off a vital public asset that serves the public good, and undervalued it in the process—it was the biggest post office robbery. There are competing estimates of the real cost of privatising Royal Mail; one suggests that it cost taxpayers around £1 billion.

I have said it before, and I will say it again: Royal Mail was not for sale. I am proud that the next Labour Government have committed to bringing Royal Mail back into public ownership. It is time that Royal Mail once again runs in the interests of the people, and is not used to maximise private profits. Despite the privatisation of Royal Mail, Post Office Ltd was kept in public ownership, but recent years have been marked by constant attacks on the post office network. The result has been a steady fall in the number of Crown post offices since 2013, and they now make up just 2% of the overall network. Some of those closures were justified by arguments about protecting other post offices from closure in the future. We accepted that, but we now face a new threat to our Crown post offices: franchising.

The Government are planning to sell 74 Crown post offices to WHSmith through the franchising process. Is WHSmith a suitable company to take on the responsibility for providing postal services? As we have already heard, it is a company that consumers voted the worst retailer on the British high street. Far from sustaining the post office network, franchising will further its decline. Does the Minister still consider WHSmith an appropriate franchise partner for the Post Office in the light of its seeking to derecognise the CWU, which supports the interests of all staff, including the postmasters? I hope she can provide an answer.

Staff will have to endure low pay and cuts to their terms and conditions, and consumers can look forward to lower service standards. However, I am encouraged by the public, who are fighting back against the threat posed by franchising. Some 92,000 people have signed a petition in support of the CWU’s Save Our Post Office campaign—Labour is on their side, and I thank them for signing the petition. We will end post office closures and stop this unnecessary franchising process in its tracks.

The Government have said that modernising the post office network is vital to ensure its sustainability, yet the modernisation programme has been a smokescreen for post office closures and staff redundancies, and is failing on its own terms. Post Office revenues are falling—revenue from Government, mail, retail and financial services all declined in 2017-18. The truth is that the post office network is struggling because of a loss of post offices and staff through the alleged modernisation. We have lost many skilled workers.

We cannot allow the post office network to decline further because communities across the UK rely on it. The Government’s own survey of the post office network in 2016 found that 95% of people use a local post office at least once per year. Almost 60% were unaware of any alternatives to post offices when it came to assessing standard postal services. If the Government continue to push the post office network into decline, the most vulnerable people and communities in our country will pay the price.

It is important to reflect on the fact that the post office network has changed in many respects. One of the most notable changes is the growing role of sub-postmasters, who now run 98% of the post office network, yet the Government expect them to run their post offices with ever-decreasing levels of funding. The Post Office’s 2017-18 annual report highlighted that there has been a 4.5% reduction in funding for sub-postmasters. I have been contacted by many sub-postmasters in my constituency who have felt the reduction in funding—one in particular. The sub-postmasters in Coatbridge, Chryston and Bellshill are angry.

I was recently contacted by a sub-postmaster who wanted to share his experience. His staffing costs are significantly higher than the remuneration that he receives from the Post Office Ltd. As we lose bank branches, residents increasingly rely on his post office to carry out their banking transactions. That is proving costly and time-consuming, yet no financial support from the Post Office Ltd is available to him to provide those banking services. On his behalf, I ask the Government to review commission rates and remuneration for sub-postmasters. I hope the Minister is listening and will take that forward.

If sub-postmasters are not properly supported, I fear we will see the loss of more post offices in our communities. That is not just a threat; it is what we are being told. Public demand on the post office network is changing, particularly as a result of the loss of banking services in communities across the UK. Banks are closing, and post offices have to pick up the pieces. I welcome Labour’s commitment to establish post office banks, including 300 in Scotland.

I pay tribute to the work of the CWU, of which I am a proud member. I have stood alongside CWU reps and members in many disputes, fighting proposed post office closures and cuts to staff terms and conditions. I will continue to stand alongside them inside and outside this House. The fight to rebuild a publicly owned and unified postal network continues. It must be won for all communities across the UK.

--- Later in debate ---

[Kelly Tolhurst]

I understand where the hon. Lady is coming from, but the reality is that 98% of the post office network is franchised. That is the fundamental business model within the Post Office and its distribution of services. The hon. Lady makes a presumption that WHSmith will fail, and its franchises will therefore be under threat. That does not take into account the potential future development of the Post Office and how we are challenging it. However, as I have outlined today, and in any conversation I have had with any colleague, when hon. Members highlight something to me, I will, as the responsible Minister, always raise that with the Post Office.

In my day-to-day role, I will always challenge the decisions and workings of the Post Office. However, while we are the Post Office’s shareholder, it is commercially run, so it is within its rights to manage operational delivery, but it is for me to challenge, oversee and raise questions where I believe work is needed to resolve matters.

[Hugh Gaffney]

I will keep it short and sweet: will the Minister ask WHSmith why it will not talk to the CWU, and ask it to talk to the CWU to represent members properly?

[Kelly Tolhurst]

I understand the hon. Gentleman’s concern about the CWU and perhaps the conversations with WHSmith, but the union’s relationship with an independent retailer such as WHSmith is a matter for it. It is not for me to direct an independent business. I know the hon. Gentleman and his passion for this subject well, so I am sure he will do all that he can, in his role and with his experience, to ensure that communication takes place.

--- Later in debate ---

[Kelly Tolhurst]

As the hon. Gentleman knows, the Government have been working to make business rates more equitable for small businesses, and we are looking at the impact of that. Post offices will have benefited from that work. He mentions costs that he has been made aware of; if he lets me know that particular constituency issue, I am more than happy to take that forward. As I have outlined, under the Bank of Ireland agreement with the Post Office, postmasters are remunerated for, rather than being expected to pay for the privilege of, delivering that service for our communities.

On the question of cashpoints, as we are faced with bank closures, which is a problem that we all very much agree on—they have deserted our high streets—it is for the post offices to pick up the slack in some cases. That is why this Government, with the Post Office, have been negotiating strongly on the new banking framework—to get a better deal for the postmasters who are delivering services that we all rely on in our high streets and communities.

The question of accessibility in the franchise branches has been raised. Franchising means that a post office presence can be maintained in town and city centres in a way that not only makes financial sense, but ensures that services are more accessible to customers, for example through the provision of extended hours and Sunday opening. Post Office Ltd is wholeheartedly committed to ensuring that the needs of the community and its customers are met in any relocation. That is why the Post Office consultation encourages the community to share its views on all matters, including issues related to accessibility under the Disability Discrimination Act 1995.

Post Office Ltd and its franchise partners have stringent rules regarding access to post office branches, which meet all relevant legal requirements, to ensure that all customers, including those with disability or mobility issues, can access their branches. The Post Office also runs local consultations in order to engage local communities, so that they help to shape its plans. The Post Office does not seek a mandate for the franchising, but consults on practical aspects of a proposed relocation, such as service provision and accessibility.

[Hugh Gaffney]

The Minister mentions communication. Has she met the Communication Workers Union about post office closures? Will she arrange that?

[Kelly Tolhurst]

If I might correct the hon. Gentleman, they are not closures; they are franchises. I am concerned about the language used when we talk about the post office network. We are talking about a change in operation, not closures or a loss of service. I will happily meet the CWU on any issues it wants to raise. However, I have to be clear that these are not closures; they are franchises. I think that that sends a really strong message, because communities will think that they are losing all their post office services, when that is factually not the case.

I am aware that hon. Members have expressed concerns about this process. I have met many hon. Members to discuss issues that they have had with franchising in their constituency, and have raised those directly with Post Office Ltd. Citizens Advice reports that Post Office consultation is increasingly effective, with improvements agreed and reassurances provided in most cases. That demonstrates that the Post Office is listening to communities. Ultimately, decisions on franchising are commercial ones for the Post Office to take—within the parameters set by the Government to ensure that we protect our valued network.

On the partnership between WHSmith and Post Office Ltd, WHSmith sees post offices as a central hub in the community and takes the social responsibilities that come with that very seriously. As I have outlined, WHSmith has successfully operated post offices within its stores since 2006, and following the recent agreement, the number of post offices run in WHSmith stores will be greater than 200. This will support the long-term sustainability of post office branches and bring longer opening hours, so that customers are offered seven days of trading a week in convenient locations. Throughout this period, WH Smith has shown that it can successfully run post office branches across the country by delivering excellent standards of customer service, with trained staff promoting products and services in a modern retail environment.

Hon. Members have levied accusations about the fitness of WHSmith and its operation, but it is still very much a recognised brand on the high street, as is the Post Office. We need to accept that some consumers and customers are still very much lovers of the WHSmith brand. I have visited WHSmith branches in which there have been franchises, and the feedback from the community has been very good. I have seen at first hand how it can work. However, each store operates independently. Again, if there are issues with branches in any Member’s constituency, we will always raise those directly with the Post Office.

The Post Office card account is a commercial matter for the Department for Work and Pensions and Post Office Ltd. However, it is no secret that the contract for the Post Office card account comes to an end on 30 November 2021. For claimants who are unable to open a mainstream account ahead of that date, DWP will implement an alternative payment service that allows users to obtain cash payments, wherever their location, before the end of the contract.

It is worth pointing out that that 99% of a bank’s personal customers are able to withdraw cash, deposit cash and cheques and make balance enquiries at a post office counter. Post offices will therefore remain central to delivering cash to customers, including the elderly or the most vulnerable, regardless of the banking product that they chose or move to.

The hon. Member for Sheffield, Brightside and Hillsborough (Gill Furniss) rightly said that it would not be appropriate for us to talk about the legal proceedings at this time. However, I assure her that as the Minister responsible, I will endeavour to take any action required. I am absolutely committed to doing whatever is in my power to make sure that the Post Office retains its standing, and that the relationships it maintains are the best that they can possibly be.

--- Later in debate ---

[Hugh Gaffney]

The Minister says that standards will be maintained. Franchises do not maintain the same standard of services as Crown post offices. That is the point I am trying to make.

[Kelly Tolhurst]

I respect the hon. Gentleman’s position, but I disagree that moving to a franchise equals a loss of services and standards. I do not believe that, and I have not seen that, so I respectfully disagree. However, I absolutely take his point and understand his concerns.

Decisions on bank branch closures are a commercial matter for banks and are taken by the management team of each bank, without intervention from the Government. So that hon. Members can see exactly how well I understand the problem, I highlight that I represent Rochester and Strood, and Rochester no longer has a bank in what was the city. However, the Government recognise that branch closures can be disappointing for customers and believe that the impact on communities must be understood, considered and mitigated where possible. That is why we support the Post Office’s banking framework agreement, which enables 99% of the UK’s personal banking customers and 95% of the UK’s small and medium-sized enterprise banking customers to carry out day-to-day banking in the post office network.

I reassure the House that all post offices across the network are of the utmost importance to the Government. We recognise their value and importance to communities, residents, business and tourism in rural and urban parts of the UK. We also recognise and respect our sub-postmasters and the people who work within franchises, who work so hard, as was outlined throughout the debate; some postmasters will go the extra mile. We respect them, and we are determined to work with our partners to make sure that we maintain the Post Office as a viable business proposition for any postmaster to continue with. We will continue to honour our manifesto commitments, so that post offices thrive and remain at the heart of our rural and urban communities.

I again thank hon. Members for their contributions to the debate. I understand their frustrations, and I take their issues on board. In closing, I remind colleagues that, as I have said several times, I am always willing to talk to any MP regarding any constituency branch issue.

Community and Sub-Post Offices

Hugh Gaffney Excerpts

Wednesday 27th March 2019 Commons Chamber

[Gavin Newlands]

I totally agree with my hon. Friend. I know Maryhill Road well as I used to work there for many years. It is in the heart of Craiglang, where my wife is from.

[Hugh Gaffney (Coatbridge, Chryston and Bellshill) (Lab)]

Does the hon. Gentleman know that not just the banks are shutting post offices but the Government? The Post Office is shutting down Crown post offices, and 73 post offices in Scotland have been put into WHSmith—the worst retailer in the country. This is happening because of the Government. The Scottish Government are different—they are opening up post offices.

[Gavin Newlands]

I totally agree. The post office network, with the Crown issue and this issue, is being dismantled before our eyes unless the Government get to grips with this.

Future of the Oil and Gas Industry

Hugh Gaffney Excerpts

Thursday 14th March 2019 Westminster Hall

[Pete Wishart]

I had a sneaking suspicion that I would secure an intervention based on the hon. Gentleman’s desire for fracking to be included in all this. As he knows, there was a robust debate among Committee members on the value of fracking and what we should say about it in the report. He knows that I do not share his views, although I am aware of the evidence that was given sincerely by some members of the sector. The Committee agreed a consensus that this was something we were not really concerned with as we went forward, and we have left it as such in the report.

[Hugh Gaffney (Coatbridge, Chryston and Bellshill) (Lab)]

Yesterday in his statement the Chancellor talked about banning gas from new homes in 2025. Surely we have to look to the benefits of oil and gas in the future. Is that not a worry for us?

[Pete Wishart]

Absolutely. I was intrigued by the message from the Chancellor yesterday, when this was mentioned. Yes, there are huge opportunities for us. I think the hon. Gentleman will agree that it was mightily impressive to see the things that could come and how these skills could be applied and transferred. Perhaps the Minister can say what more work could be done to ensure that we get this. We would be grateful for any insight into the conversation he has been having with the sector on skills transfer.

The sector deal must bring forward proposals for how the sector will address its carbon footprint, both in the process of producing and extracting oil and gas, and by finding ways to reduce emissions from their use. The report received a mixed reaction from some environmental groups—I will put is as delicately as that. That surprised me, due to the range of recommendations we made and the care and diligence that we gave to shaping up some of the transition recommendations. We believe in a just transition and said as much in the report. We believe that if that is achieved, we will get to a new future—a green and transformative future for the sector.

--- Later in debate ---

[Hugh Gaffney (Coatbridge, Chryston and Bellshill) (Lab)]

Thank you for calling me to speak in this debate, Mr Walker. I thank all my colleagues on the Scottish Affairs Committee for their work in producing this report.

It would be an understatement to say that the oil and gas industry is a vital part of the Scottish economy. It contributed £9.2 billion in 2017 and, as we have heard, it supports about 135,000 jobs. It is essential to the UK’s energy security, and forecasts suggest that oil and gas will account for two thirds of the UK’s primary energy needs until at least 2035.

The industry has suffered in recent years, but is starting to come through a challenging downturn, although there are still worrying signs, such as the low levels of new well exploration. There are also future challenges for the industry, such as declining production, climate change targets and the decommissioning of oil and gas rigs. I agree with the report’s central finding that the Government must provide serious and credible support to the industry through the sector deal. A sector deal supported by the Government and industry has the potential to deliver £110 billion for the UK economy by 2035. It must help with the development of new technology to maximise the recovery of the 10 billion to 20 billion barrels of oil that remain in the UK. It must find ways of encouraging greater decommissioning of oil and gas rigs, while reducing the cost of doing so. It must ensure that the industry’s skills, expertise and technology are protected for the future, including by transferring them for use in renewable energy, subsea engineering and carbon capture. The oil and gas industry has many opportunities for Scotland and the whole UK, which we should not waste. That is why I endorse the report’s findings, including its key recommendations about a sector deal.

I want to touch on some of the issues raised with the Scottish Affairs Committee, particularly by Unite and the National Union of Rail, Maritime and Transport Workers. Those unions play a crucial role in organising and representing the interests of workers in the oil and gas industry. They were both keen to emphasise the need to maximise the industry’s economic recovery to its full potential. They share the sentiment of the industry and the Government.

It is welcome that the Oil and Gas Authority will lead exploration by commissioning surveys of unexplored areas of the sea bed. The creation of the Oil & Gas Technology Centre through the Aberdeen city deal was welcome. The “maximising economic recovery” strategy cannot be implemented through significant reductions in costs, given the impact that they could have on the workforce. There is a clear case for the Oil and Gas Authority working with the UK and Scottish Governments to create strategic public stakes in the implementation of the strategy. Those stakes should include infrastructure, such as pipelines, and public investment through borrowing and national investment banks. Only through co-investment by public and private stakeholders can we ensure the strategy’s success.

The fall in the oil price in recent years led to an 18% reduction in the core offshore workforce between 2014 and 2016. It also led to a reduction in the workforce’s terms and conditions. RMT highlights the growing use of short-term and zero-hours contracts. The industry and trade unions have observed practices including the application of retrospective charges for training, the exclusion of trade unions from heliports, the denial of holiday entitlements and the ignoring of TUPE requirements. I believe that Unite is right to call for the full devolution of employment law to Scotland so that we can begin to address those issues, alongside investing in skills, apprenticeships and training in the industry.

Although decommissioning must be a crucial part of the sector deal, it must be done in a way that preserves skills, expertise and technology. It is clear to me that there should be a national decommissioning strategy to ensure that decommissioning delivers for workers and our economy. The strategy must be devised through discussions between the UK and Scottish Governments, local authorities, industries and trade unions.

I would like to talk about safety in the industry. As a trade unionist, I want to ensure that all workers are safe in their workplace. It alarms me to see the findings of a recent report by Robert Gordon University, which received responses from 40% of offshore workers from the major companies in the industry. It found that 52% of workers are dissatisfied with their work-life balance; 45% said that it takes them longer to recover from their shifts, and 57% believe that the conditions of their offshore sleeping environment have worsened. Let us not ignore workers’ concerns about offshore helicopter safety. Some 62% said that they would be unlikely to fly in a Super Puma helicopter if given a choice.

[Bill Grant (Ayr, Carrick and Cumnock) (Con)]

I share the hon. Gentleman’s concerns about the safety of workers and the avoidance of accidents. What does he think the Government can do to bring the oil companies to the table for discussions with trade unions about the important matter of the safety of personnel on their rigs and in helicopters?

[Hugh Gaffney]

I will come to that point; I take an interest in it. I recently met Oil & Gas UK, with which the unions are getting together to bring the workforce on board. Without the workers on board, no company can go anywhere. Unless companies involve their workers in the process, there is no point trying to organise the company.

I declare an interest: 27 years ago today, I took an interest in North sea oil safety helicopters when a Super Puma helicopter went down, killing 11 men, of whom my brother-in-law was one. Today is the 27th anniversary of the crash, so I welcome the report. I hope that the industry will take serious steps to address those safety concerns, particularly as employers have a duty to ensure that workers are safe in their workplace and can get home safely.

To conclude, I reiterate my support for the findings of the report, including its recommendation of a sector deal. It is clear, however, that there are challenges that we will have to address: “maximising economic recovery”, decommissioning, terms and conditions and, most importantly, the safety of the workforce.

--- Later in debate ---

[Richard Harrington]

The hon. Lady has caught me unawares, because I am afraid tax is not one of my specialities; I apologise to her. I will find out about that, and if she would like me to write to her—or we could have a coffee together outwith this place—I would be happy to do so.

I should make some progress, because I am testing the patience of the Chair, and he wants two minutes left over. Trevor Garlick and the team have done a lot for the industry. He has brought a diverse sector together, which is the purpose of our sector deals; previously, most relationships between Government and companies seemed to be based on a few big companies that had very effective lobbying machines and knew the way the Government worked. In the oil and gas sector, he has helped to break that and has brought a lot of things forward.

The leadership has been very good, as have many of the work streams; we have five areas of focus in the report, but it seems to me that work on them is already being undertaken. For example, the National Decommissioning Centre has already been launched, with £38 million in funding. The Oil & Gas Technology Centre continues to lead on new technology and to support MER UK, which I was happy to visit in Aberdeen, on transformative technology. The work on exports that was mentioned is progressing well.

The work streams on other things that are part of Government policy, such as diversity and inclusion as well as CCUS, have developed very well. I was pleased that the Chancellor yesterday called for evidence to identify what more should be done to make Scotland and the UK a global hub for decommissioning, as the Chair of the Select Committee has talked about.

[Hugh Gaffney]

The Chancellor yesterday mentioned, if I can rephrase him, using less gas by 2025. The Minister is talking about decommissioning. Is that not a worry for the oil and gas sector?

[Richard Harrington]

If I were the hon. Gentleman, I would not worry about that. We are also asking how the sector can support the development of UK carbon capture, usage and storage infrastructure through the effective use of legacy assets. The focus on underwater engineering proposed by industry, as part of a phased approach, is welcome. We are a global leader in subsea engineering, a market forecast to grow exponentially, but competition is fierce.

I am responsible for sector deals generally, and I am very much looking forward to advancing these proposals. What impresses me most about the way this sector has developed is that with Mr Garlick’s work and the co-operation of many people in Government, Parliament and the industry, so many of these things are already happening. I am very impressed by that; I wish I could say that was true in other sectors that I have been involved in. I commend the Committee’s report, and I look forward to developing the points in it.

Leaving the EU: Protection for Workers

Hugh Gaffney Excerpts

Wednesday 6th March 2019 Commons Chamber

[Greg Clark]

I am grateful to the hon. Lady for what she says. As I said to the hon. Member for Salford and Eccles (Rebecca Long Bailey), most of these rights derive from primary legislation. We will see whether there is an ability to provide the assurance that the hon. Member for Great Grimsby (Melanie Onn) seeks.

I am grateful to the hon. Lady for the contribution made by her private Member’s Bill. She has done the painstaking work of producing a great schedule of directives to which her Bill would apply. I propose—I hope she will not mind—that we plagiarise that and introduce it as the basis for our list of directives so that we can, if not replicate it in all respects, at least capture the spirit of her Bill.

[Hugh Gaffney (Coatbridge, Chryston and Bellshill) (Lab)]

I thank the Secretary of State for saying that he recognises the abuse by “a small number of firms, in a small number of industries”, but I do not agree with the use of “small”. I think that should be “huge”, “large”, or “common practice”. Will he give a level playing field to the workers in these industries by stopping zero-hours contracts?

[Greg Clark]

I will not do that, because one of the conclusions of the Matthew Taylor report was that most people, of the small—and, indeed, shrinking—number of people on zero-hours contracts welcome that flexibility. The hon. Gentleman will know that many Labour councils up and down the country have casual workers on those contracts and say, in terms, that they are an important part of what their workers want.

However, I do agree with the hon. Gentleman on enforcement. A number of firms are doing such things, but they are not typical, by any means. Some of us will have read about some of the abuses in the garment industry in and around Leicester, for example. These simply cannot be allowed to continue without the steps being taken to restore confidence to those workers that their rights will be respected. That is the intention behind what I have set out in terms of strengthening and better resourcing our enforcement mechanisms.

Unpaid Work Trials

Hugh Gaffney Excerpts

Tuesday 5th February 2019 Westminster Hall

[Hugh Gaffney (Coatbridge, Chryston and Bellshill) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Hollobone. I, too, start by congratulating the hon. Member for Glasgow South (Stewart Malcolm McDonald) on both securing this debate and the work he undertook on the Unpaid Trial Work Periods (Prohibition) Bill. When I first arrived at this House after the 2017 general election, I wore my Parcelforce shirt to remind me where I had come from and why I was elected by the people of Coatbridge, Chryston and Bellshill, whom I asked to send a working man to Parliament. They sent me here to fight for justice for workers, and that is why I call on the Government to end not just this scandal of unpaid trial shifts, but all employment practices that fail to treat people with dignity and respect.

I was truly disappointed that the Government chose to talk the Bill out, despite the support from hon. Members of all parties, the trade union movement and the public. The Government have allowed this scandalous situation, in which employers can ask someone to undertake an unpaid trial shift, to continue because of their actions. It is not isolated to one sector of the economy or one type of employer; it is a widespread practice in our economy, ranging from the hospitality sector to the creative industries. The practice is used not only by small, family-run businesses, but by multinational corporations that think it is normal. I am sure we can all agree that it is a practice which must come to an end.

I pay tribute to organisations, such as the Scottish Trades Union Congress and the National Union of Students, that are working tirelessly to highlight the injustices faced by those who are made to work unpaid trial shifts. I particularly commend the “Better Than Zero” campaign for the tremendous work it has done and continues to do to highlight some of the worst employment practices in Scotland and to educate, organise and mobilise young workers to fight for their rights. I have joined with the campaign on many occasions, and it was a pleasure to take action together.

It is time for us in this House to take real action on this question. There should be legal clarity for both workers and employers on what constitutes a trial shift. There should be a requirement for employers to outline the length, the criteria and the outcome of any trial shifts undertaken, and it should be made clear in the National Minimum Wage Act that a failure to pay individuals for working on a trial shift is illegal. It is time that the Government sent out that message.

Of course, unpaid trial shifts are just a symptom of the type of economy that the Government have created. It is an economy where many workers are not paid the living wage—I want to see that living wage, or even the national minimum wage, increased to £10 per hour. It is an economy where many workers find themselves with job insecurity, with the use of zero-hours contracts, but we are told that the unemployment rate has never been lower. It has never been lower because of zero-hours contracts; that is how that figure is justified. This is an economy where basic health and safety requirements such as breaks are viewed as optional or outright ignored by employers. It is an economy where workers find it increasingly difficult to organise and mobilise to defend their rights, terms and conditions, all because of this Government’s sustained attacks on the trade union movement. I say to any workers working in low-paid jobs, “Join a trade union today. You can make a difference.”

FTSE 100 Company Pay Ratios

Hugh Gaffney Excerpts

Wednesday 23rd January 2019 Westminster Hall

[Siobhain McDonagh (Mitcham and Morden) (Lab)]

I beg to move,

That this House has considered FTSE 100 company pay ratios.

It is a privilege to be under your chairship today, Mrs Moon. I have to be honest and open with the Chamber: I am guilty of trying to dumb down parliamentary proceedings; I attempted to call this debate “Fat Cat Friday”. However, the Table Office pointed out that that would not be correct in the circumstances. I wanted to call the debate that because by lunchtime on Friday 4 January, the UK’s top chief executives had earned more than their average employees would earn over the entire year. Those chief executives take home astronomical figures that are more like telephone numbers than salaries. Although the average employee has seen their salary remain stubbornly low, the pay packets of the FTSE 100 chief executive officers have risen by an average of 11% over the last year alone, soaring to a staggering average of £3.9 million per year. How can that be right, just or fair?

Let me emphasise right from the beginning that I have absolutely no qualms about those at the top being paid well; I appreciate the demands of running one of the UK’s biggest organisations. And I am not, at the moment, calling for a pay cap or a widespread cut to chief executives’ pay. I am calling for fairness—for the importance of the contribution of those at the bottom to be recognised in line with the contribution of those in the boardroom; and for organisations to determine the pay and reward schemes of all employees in one whole-company pay policy.

I will describe in more detail the pay ratios across the FTSE 100, and will consider the causes and consequences of such extreme differences in pay within organisations. Then I hope to detail the reality in some specific organisations, before considering the tangible steps that the Minister and this Government should take to combat such unfairness in the workplace.

Let us start with the FTSE 100. In advance of this debate, Will Turvill of The Mail on Sunday made a remarkable analysis of the pay ratio between FTSE 100 CEOs and the average wage of workers at their firms. Staggeringly, his results reveal that one FTSE 100 company, Melrose Industries, pays its chief executive a completely eye-watering 1,000 times more than the average wage of its employees. I appreciate that this is an extreme example, but few of the other 99 companies on the FTSE 100 index can consider themselves exempt from being similarly unjust.

Even among the FTSE 100, there is inconsistency and disparity. A FTSE 100 CEO is more likely to be called David or Steve than to be a woman or to come from an ethnic minority. What is more, the six female FTSE 100 chief executives earn just 54% of the salary of their 94 male colleagues. However, that is a debate for another day, because it is the FTSE 100 index as a whole that I will focus on today.

Back in the late 1990s, the pay of a FTSE 100 CEO was an extortionate 59 times higher than that of their average employee. If we fast-forward 20 years, it has sky-rocketed to being an eye-watering 145 times higher, and rising. Let that sink in: it means that it would take the median UK worker an extraordinary 137 years to earn a FTSE 100 CEO’s annual pay. Is a chief executive today working that much harder than they did just 20 years ago? The statistics suggest otherwise, as there is very little evidence that soaring CEO pay has incentivised or been the reward for better company performance, because the value of the FTSE 100 has changed little since the late 1990s. However, the pay of FTSE CEOs has increased by 300%. Meanwhile, two thirds of these top firms fail to pay the living wage.

Such mind-boggling figures are difficult to comprehend. To provide some perspective, a FTSE 100 CEO is paid an estimated 132 times more than a police officer, 140 times more than a teacher, 165 times more than a nurse, and an astronomical 312 times more than a carer. These indefensible ratios are a slap in the face for hard-working employees across our country who, at the very least, expect to take home a fair day’s pay for a fair day’s work.

Before this debate, the House of Commons digital engagement team kindly sought the views of the public on this matter. One person said that

“when their employees are working full time and not being able to afford proper accommodation, energy, food, transport or children, suddenly the difference in pay seems rather stark.”

Another person suggested that

“there should be a pay ratio, so if CEOs wish to continue enjoying these luxuries they must ensure that their lowest paid employees are earning a sufficient amount.”

I believe that the pay ratios that I am describing are utterly unacceptable, unjust and unfair. As the executive director of the Equality Trust, Dr Wanda Wyporska, says:

“A society that values its teachers, care workers and nurses at less than 1% of a FTSE CEO is beyond broken”.

Her view is a common one, with an Oxfam survey finding that 72% of people want to see the Government urgently addressing the income gap between rich and poor.

What is causing such extraordinary executive pay to continue soaring? Perhaps it is the fact that former or serving chief executives pack the remuneration committees that set pay levels at large companies; perhaps it is the decline in trade union membership; or, most likely, it is the inaction of the Government on ensuring that fairness is at the heart of the world of work.

These pay ratios stem not just from extortionate salaries, but from extraordinary incentive schemes that are increasingly reserved only for those in an organisation’s boardroom. I must be clear once again: I have no problem retaining incentive pay for executives. However, incentive schemes should be available to all staff on the same terms.

[Hugh Gaffney (Coatbridge, Chryston and Bellshill) (Lab)]

I am sorry for stopping a good speech, but my hon. Friend mentioned incentives; these CEOs also have the incentive of awards, including CBEs. Paula Vennells of the Post Office got a CBE, as most of these fat cats do. They end up getting awards, OBEs, knighthoods and all the rest of it, while the workers are suffering. There are people at the Post Office who face difficulties because of Horizon, a new system that has come in. Good postmasters—good people who are loyal to their communities—have been taken to court, and some of them are now going back to court. Will these CEOs be stripped of their knighthoods and awards?

[Siobhain McDonagh]

I thank my hon. Friend for that intervention. I will consider the Post Office a little later in my speech.

Having such incentives for all staff seems like a common-sense way of providing sensible alignment between average workforce pay and executive pay. It is a straightforward, practical idea to have a whole-company pay policy. Let me describe in more detail the reality at specific organisations in the FTSE 100 to illustrate the inequality that grows in the absence of a whole-company pay policy. I will start with Persimmon, whose former boss, Jeff Fairburn, last year received, on the back of Help to Buy, £47 million, which is an extraordinary 882 times the average salary of his workers, before he lost his job. We all remember the backlash when Mr Fairburn was granted a £75 million bonus. In the heart of a housing crisis, do we really think that he should receive such a staggering sum, or should we have seen that money helping young couples who are looking to get on the housing ladder?

How about the owner of Ladbrokes, GVC, whose chief executive, Kenny Alexander, raked in pay that was a huge 484 times higher than the average pay of his workforce? And how about Tesco, whose CEO, Dave Lewis, received a £4.9 million pay packet, which is 303 times greater than the average pay of his employees? Is he working 303 times harder, longer, or better than them?

Then there is Sainsbury’s: a pillar of the Great British high street. Over 148 years, it has established a reputation as a leading retailer and a good company to work for, but its lack of a whole-company pay policy has led to the most disgraceful discrepancy in its staff salaries. Under the guise of an increase in basic pay, 9,000 loyal and long-standing Sainsbury’s staff are set to lose up to £3,000 a year from 2020. They will forgo their paid breaks, the night shift will be shortened, and their Sunday premium will be removed. While those shop floor staff will see their bonus scheme scrapped under these new contracts, CEO Mike Coupe takes home an eye-watering bonus of £427,000 as part of his £3.4 million pay packet, and although the salaries of those staff are crumbling, their bills, mortgages and rent are still the same at the end of each month. I wonder whether Sainsbury’s remuneration committee gave a moment’s thought to those staff when it signed off its executive bonuses. When the board and remuneration committee sit down to discuss what the pay package for Sainsbury’s CEO is going to be, they should also be deciding the pay and conditions for their lowest-paid staff. If they thought about those two things together, there would be a bit more modesty, a bit more honesty and a bit more embarrassment.

Such inconsistency and injustice has grown to become the norm throughout the FTSE 100 and across the high street, with treasured organisations such as Marks & Spencer and B&Q falling foul of the expectation of organisational fairness. The absence of a whole-company pay policy in such organisations has led to unjust disparities. It is at this point that I turn to the Royal Mail.

Of course, examples of those disparities can be found outside the FTSE 100, and I thank the Communication Workers Union for bringing the following example to my attention: since the Royal Mail was privatised by the coalition Government, the pay of its CEO has soared beyond recognition. Before privatisation, the total pay of the chief executive, excluding their golden hello, stood at just over £1 million, 50 times higher than the average wage in the organisation and 78 times higher than the lowest wage. Since privatisation, the chief executive’s salary has doubled; it is now 90 times higher than the average wage and an unjustifiable 123 times higher than the lowest wage. What would have been money for a public asset and its workers is being pocketed for private profit at the very top of the company.

As for Post Office Ltd, things started to change once it was decoupled from the Royal Mail. A postal assistant earns just 3% of the salary of the chief executive, who received a 7% pay rise last year. This is an organisation that is overseeing the privatisation of Crown post offices across the country and the potential transfer of hundreds of Post Office staff to WHSmith, rated by Which? as the worst retailer on the high street. I emphasise once again that I am not calling for a cut to, or a cap on, the chief executive’s salary; I am calling for consistency, parity and fairness across her organisation.

I am pleased to see the Minister here to respond to the debate. She may remember that we met last year to discuss exploitative pay in assignment contracts, which are thankfully about to be abolished, so she has shown that she is willing to listen. Let me assess the further steps that could be taken to bring fairness back to the world of work. In August 2017, the Prime Minister described the “excesses and irresponsibility” of some big business moguls as undermining confidence and damaging the social fabric of our country. If only she had followed those strong words with strong action!

Granted, new rules that will force all UK firms with 250 or more employees to start publishing their pay ratios should be warmly welcomed. However, those figures will be based on the median average of UK employees—that is, the salary of the employee halfway between the top of the scale and the bottom. A truer reflection would be to use the mean figure, taking into account the ratio of the lowest-paid employee compared with the highest. I ask the Minister how that policy will ensure that such extreme pay ratios do not occur in the first place, and what happens if and when they are shown to continue.

As the Chairwoman of the Business, Energy and Industrial Strategy Committee, my hon. Friend the Member for Leeds West (Rachel Reeves), says:

“If shareholders won’t or can’t hold these companies to account, then we will need Government to step in with tougher rules that clamp down on this kind of executive reward.”

Naming and shaming companies, and other piecemeal reforms that rely on organisations’ good will, have proven wholly ineffective. What is more, it is overwhelmingly clear that such excessive and unequal pay ratios are unpopular with the general public and reduce staff morale. The Mail on Sunday revealed this weekend that CYBG, the owner of Clydesdale bank and Yorkshire bank, faces a shareholder revolt at its annual general meeting over excessive bonuses for bosses.

However, we should not wait for isolated pushbacks. I suggest that the Minister takes note of the example of Sweden, ranked one of the happiest countries in the world, where companies with pay gaps face fines if they fail to close them. Furthermore, trade unions should have reasonable access to workplaces, and all FTSE 100 companies should strive to be accredited by the Living Wage Foundation. Most of all, I call for the important contribution of those at the bottom to be recognised in line with the contribution of those at the top, and for organisations to determine the pay and reward schemes of all their employees through one whole-company pay policy. If an incentive scheme is made available for some staff, it should be on offer for all within that organisation, on the same terms. Why should any organisation have a rule for just some employees, not a rule for all?

If a whole-company pay policy does not work, perhaps it is time to introduce a maximum pay ratio at those organisations. In an ideal world, I would not want society to be so prescriptive, but the worsening inequality I have described undermines our democracy, and I believe that our social democracy relies on fairness. It is based on the belief that people will behave reasonably, so when our democracy is not fair, the state must become involved. This is about more than just money, the economy and the world of work. Unfairness at these levels breeds cynicism—the feeling that the system just does not work for the ordinary person—and if that system does not work, why should a person trust in, vote in or participate in it? A lack of fairness produces spiralling disharmony and disaffection in society, and it is our duty as democrats to solve it.

The fact that it takes just three days for the UK’s top chief executives to earn more than the average employee is utterly shameful. After a hard day’s work, the very least that an employee deserves is to take home a fair wage that is in proportion to that of their colleagues. Across the FTSE 100, the absence of whole-company pay policies results in organisations rewarding the minority in the boardroom at the expense of the majority at the bottom. Enforcing or encouraging a whole-company pay policy in those organisations would be a sensible, logical and practical step towards ensuring that all hard-working employees receive a fair deal at work.