Agricultural Wages Board

Jim Shannon Excerpts

Tuesday 16th October 2012 Westminster Hall

[Jim Shannon (Strangford) (DUP)]

It is not often that I speak on an issue that is a devolved matter in Northern Ireland. It is not often, either, that I disagree with my Labour colleagues, and I have spoken to them to make them aware of that.

I wish to make a few comments. I will reflect on the position in Northern Ireland, as that may bring something to the debate that other hon. Members are unable to provide because they do not represent a Northern Ireland constituency.

I hail from a strong agricultural constituency. Agriculture is a major employer, with additional employment coming from processing the food that the land produces. There are some excellent companies that farm the land, produce and package the product, and sell it on to the United Kingdom and Europe. Mash Direct, which employs approximately 100 people, and Willowbrook Foods, which employs 260 people, are just two examples.

The debate is about an issue close to my heart. I have spoken to many farmers in my constituency and it is clear what must be done for the benefit of all. The Agricultural Wages Board is an independent body that sets agricultural wages. It was established after world war two to encourage people to stay and work locally. In the area I represent, we are fortunate that people have done just that for many years. As the hon. Member for Copeland (Mr Reed) illustrated very clearly, agricultural work is hard. Many workers started when they were 16 and are now in their 50s and early 60s. The pains that come from picking vegetables take their toll, but those people enjoy their work. They currently have a good agricultural wage, and I believe that in my constituency they are happy with the process.

The AWB is no longer necessary. As we cry out for Europe to cut red tape and get rid of useless and costly quangos, it is time we started doing so on our own front. The Government have put forward a proposal on which my party is very clear. In the Northern Ireland Assembly, my party led the campaign to abolish the AWB. Michelle O’Neill, the Minister with responsibility for agriculture, has deferred to that as that is how the Assembly works. Even though the majority of people can ask for something, the nature of partnership Government means that the Minister has some say about what happens.

A DUP Assembly colleague of mine recently stated that Northern Ireland should follow the proposals at Westminster:

“It is fairly obvious that the AWB is now nothing more than yet another level of unnecessary, expensive bureaucracy. The finances ploughed into the AWB by the Dept would be far better invested in delivering frontline services to farmers. Reducing bureaucracy and freeing up resources and money for real and beneficial change is what is needed especially at a time when farmers are being financially disadvantaged”.

The hon. Member for Islwyn (Chris Evans) made that point as well. The situation in my constituency is the same as it is in Wales and in other parts of the United Kingdom—many farmers are finding it very tight when it comes to trying to make ends meet. As a representative for the rural constituency of Strangford with my ear to the ground, I have a heart for ensuring that farming remains a viable option in Northern Ireland, and I have pursued that as an elected representative over many years as a councillor and as a Member of the Legislative Assembly in Northern Ireland. Farming is the biggest single employer in my constituency. It must also be highlighted that only 20% of the work force are on the basic rate, which means that the other 80% are in the higher brackets already. Those people are protected by their contracts, and that issue also needs to be taken into consideration.

I drive an eight-year-old jeep that costs as much to keep running as it would cost to buy a new one. If my young son wanted to take it for a spin I would be protective, as we would be for any of our children. That is my nature. I was recently informed that a new tractor costs in the region of £75,000. I would certainly want to ensure that skilled workers were in charge of a tractor, not simply someone on minimum wage. Farmers have assured me that this is their view. It is horses for courses, if I can use that terminology, Mr Caton. Those who have the skills and abilities will do different jobs on the farm. Those who do not have the skills to drive the tractor, or whatever it may be, will do the manual labour, but I agree that they deserve a minimum wage.

Farmers will pay for experience, and taking away the AWB does not mean that wages will drop and people will lose their protection. Farmers must be free to set their wages in a competitive manner and ensure the survival of their farms at a time when many farmers are only able to take the minimum wage themselves. A great many farmers in my area are taking a wage that is equal to that of their agricultural workers, because of necessity and because the banks are on their back. These are hard times for farmers and we have to be very careful about what we do. They farm the land because they love it. The land is the blood in their veins, and it is clear that they will always seek to do their best to get the best from their farms. That will only come through having skilled workers who know what they are doing and who are worth their weight in gold.

I am not alone in agreeing about the abolition of the AWB. In fact, the Ulster Farmers’ Union—hon. Members have spoken about the National Farmers Union; this is the branch in Northern Ireland—has recently questioned the need for the AWB in Northern Ireland, following Michelle O’Neill’s decision to retain its structure in Northern Ireland. That is her decision at this moment in time, to be deferred but also to be looked at again. The UFU is clear in its belief that the AWB is

“an unnecessary and unwanted quango which is costing local tax payers money and is serving”—

with respect—

“no useful purpose.”

That comes from a union whose sole role is to represent farmers and ensure that their voice is heard. I stand as that voice for the UFU. Its spokesperson Robert McCloy, chairman of the employers representatives on the AWB, said:

“We have repeatedly called for the AWB in Northern Ireland to be abolished. The AWB is an additional layer of bureaucracy on top of existing employment laws which are already in place to protect workers. The National Minimum Wage covers the minimum rate of pay, holiday entitlement, sick pay and rest breaks and this, together with the Working Time Directive and a plethora of other employment laws now provide significant protection for employees”.

That is what the people I represent tell me through the UFU and farmers who give their workers good wages. I am aware that the UFU is continuing to lobby for the removal of the AWB in Northern Ireland to save farms throughout the Province and I stand in agreement with them. I understand the fear that workers might have, but I agree with the spokesperson from DEFRA who recently said:

“Agricultural wages laws are more than 60 years out of date, difficult to understand and entirely out of step with modern work practices. Changing them would free numerous small farmers from unnecessary burdens while keeping farm workers, like all other workers across the economy, well protected by national minimum wage legislation.”

To back up that statement, I use the example of those who work on farms, growing the vegetables, potatoes and arable crops and then processing them in factories to sell on. We have many people who come from other parts of Europe to work in the fields and the factories. We have young boys and young girls who leave school at 16 and go straight into this work, which they have been doing for many years. They are protected by the farmers who employ them.

In conclusion, it is unclear to me why farmers should be the only private sector employers who have wage rates set by anything other than the minimum wage structure. It is past time that this ancient body was removed to let farmers pay the wage they determine, as any other business does. I support fully the abolition of the AWB in England and Wales. In Northern Ireland, my party has already stated its opinion. I hope that the Department will follow suit. It is not often that I disagree with my colleagues. I look upon them as friends, because we vote together on many things. On this issue, however, I am sorry that I cannot agree with them.

--- Later in debate ---

[Huw Irranca-Davies (Ogmore) (Lab)]

I thank my hon. Friend the Member for Copeland (Mr Reed) for securing and introducing the debate. He opened with such an erudite analysis of why the AWB and its functions have been so important over a long period and continue to be important, not least against the backdrop of declining economic activity throughout the country and in rural areas. The issue is indeed to do with the protections afforded not only on pay but on conditions, such as bereavement and all the things mentioned by my hon. Friends. It is also to do with ensuring that we have a good supply of keen, enthusiastic and well-skilled people coming into the industry in future. I shall return to such points because I do not agree with what was said in the written ministerial statement, although we thoroughly welcome it, and I appreciate the courtesy of receiving it before the debate started.

As I looked through the statement, I noted:

“The functions of the Agricultural Wages Committees are now largely redundant”.

I shall return to the comments made by the hon. Member for Strangford (Jim Shannon), who made a good contribution, but the points made by my hon. Friends make it clear that it is far from a settled issue that such functions are redundant. I will go through some of those arguments in detail.

I ask the Government and the new Minister in post, who has this opportunity, to think again about the abolition of the AWB. I ask him to do so because it is not without precedent for this Government to think again. Uniquely, it would be the first time that the Government have thought again in October. In every other month, we have had thinking again and U-turns, so the Minister could make a bit of history today by being the first Minister, although new in post, to think again in the month of October.

DEFRA has done much thinking again on many countryside and coastal issues. We have had U-turns on proposals to destroy buzzards’ nests to protect pheasant shoots, on pasty taxes—thanks to nationwide outrage led by the good people of Cornwall and the south-west—and on the great forestry sell-off of 285,000 hectares of state-owned woodland. We have had a partial U-turn on proposals to close coastguard centres and, unfortunately, a U-turn the wrong way on circus animals, dropping the previous commitment to a ban down to a commitment to new licensing conditions.

I do not want to be exhaustive, but my argument to the Minister is that he could think again because doing so is not unprecedented. We have had tax U-turns on caravans, video games and charitable donations, and other policy U-turns—some welcome, some not—on housing benefit, the mobility parts of the disability living allowance, financial inclusion fund debt advisers, the chief coroner, the military covenant, softer sentencing discounts, strike fighters, Ofsted inspections, school sports, rape anonymity and free school milk. I am dizzy from thinking about the number of U-turns.

In November last year, given opposition to the Government’s proposals, there was a U-turn on the decision to scrap the Youth Justice Board as part of the bonfire of the quangos. Suddenly, that bonfire had one less log on it. I ask the Minister to leave the fire burning brightly without the little log of the AWB as well—it will crackle nicely without it. The Minister can—independently, with independence of mind, new in his ministerial position—make his mark, a welcome mark, by performing one little pirouette of a U-turn on the AWB, a graceful and elegant pirouette. We would applaud his skill and his general loveliness. Other U-turns have been clunky and begrudging. Let the Minister, new to the role, manoeuvre artfully and delicately about-face.

I am not asking the Minister to do something that he does not want to do. In his heart of hearts, he is on the side of farm labourers and smaller farmers, and he has many in his constituency. Does he know how many agricultural workers in his constituency may be affected by the proposals to abolish the AWB? Of course he does. According to Library statistics, there are 1,020. Does he know that that puts him into the elite club of constituencies in the UK with more than 1,000 agricultural workers, many of them low paid and subject to the provisions and protections that we have talked about today? Of course he knows that. The figures are even starker when comparing the number of agricultural workers with the overall population in areas such as the south-west, where there are nearly 23,500 agricultural workers. His constituency might be hit hardest by abolition of the AWB, which may affect 152,000 workers in England and Wales.

I am convinced that the Minister wants a U-turn for his constituents, small farmers and farm workers. Before he attempts that pirouette, I will helpfully warm him up by reminding him why the AWB is so important. This is not, as he may later want to persuade us, just a matter of minimum pay. That would wilfully misconstrue the nature and purpose of the AWB, which is so much more. The Agricultural Wages Board involves

“representatives of farmers and agricultural workers together with independents, negotiating legally enforceable minimum wages and conditions which are significantly superior to those set by the National Minimum Wage and Working Time Regulations”.

The quote continues:

“the Agricultural Wages Board also sets a series of rates of pay to reflect the varying qualifications and experience of farm workers, thus providing a visible career structure for recruits going into agricultural work and is used as a benchmark for other rural employment… average earnings in rural areas are considerably lower than in urban areas… any weakening of the Agricultural Wages Board or its abolition would further impoverish the rural working class, exacerbating social deprivation and the undesirable indicators associated with social exclusion”.

I could not agree more. Those fine words are from early-day motion 892 in 1999-2000, to which the Minister was a signatory. What, I wonder, has changed since then?

During our early and youthful days in Parliament, we all had foolish fancies—we would not be human if we had not—and we would prefer not to be reminded about some of them. However, we also had strong and unwavering beliefs, and I know that the Minister has such beliefs, to which he stays constant. We deviate from such principles at our mortal peril. The Minister should stay true to his course and abide by the pledge he rightly made in that early-day motion. It was not a foolish fancy; it was his principles in writing. He said that the AWB provides a

“visible career structure…a benchmark for other rural employment”

and that abolition would result in “social deprivation” and “social exclusion”.

The Minister was right then, and we are right now, so he should return to the right side of the argument. The AWB streamlines and simplifies decision making for small farmers, so avoiding the time-wasting and complexities of drawn-out negotiations with individual farm workers one by one. Its abolition will increase bureaucracy for small farmers. Furthermore, as was said earlier, some small farmers market their own skills to others in a straightforward way with pay and conditions set and agreed by the AWB. They do not have to hammer out deals at each and every turn. I thought that the Government wanted to make things easier for businesses, especially small businesses, in which case they should keep the AWB.

The Minister may, as his predecessor did, pray in aid the National Farmers Union, for which I, like other hon. Members here, have a great deal of time. It does a sterling job in trying to synthesise a wide variety of views on a wide variety of issues. The manager of a large agri-industrial concern farming 10,000 or 20,000 acres may have slightly different motivations and needs than those of a small upland hill farmer on a couple of hundred acres. I declare an interest because 40% of my constituency is upland hill farmland, and I have family who are upland hill farmers. However, I am not speaking just for them; I am speaking for young farmers.

The Welsh Assembly Government had a cracking debate last week that was supported not just by the Farmers Union of Wales, but by young farmers of Wales who are worried that abolition of the AWB will hamper their access into the industry. Through this debate, I ask the NFU whether it is really saying that none of its farmers, not even tenant farmers, smaller farmers and those who want entry to farming want the AWB to be retained?

I will not go through all the reasons why the AWB is so important. They have been brilliantly articulated by my hon. Friends the Members for Copeland, for Islwyn (Chris Evans), and for Rutherglen and Hamilton West (Tom Greatrex), and have been made in previous debates by me and others.

I turn briefly to some of the messages from the Low Pay Commission. Its factual observation is that minimum rates will not cover pay for skilled workers. There is no statutory minimum wage for workers under the age of 16, and there is concern about the overtime premium, the night premium and the on-call allowance. It notes that holiday entitlement will be reduced if the AWB is abolished and that sick pay will be significantly less. It also notes that the number of days of bereavement leave will not be specified and that there will be no statutory right for such time off to be paid. Rest breaks will be less favourable for adult workers, and so on. There will be no statutory entitlement to a birth and adoption grant. Piece rates will be lower. At the moment, they are at least the minimum hourly rate of pay applicable to the grade. What is a fair rate, if it is not what is currently being paid under the AWB?

Northern Ireland and Scotland will retain AWBs. The hon. Member for Strangford said that he has his ear to the ground. I say with conviviality and friendliness that the problem of having an ear to the ground means hearing lots of different things. I have my ear to the ground in different places throughout the UK, and farmers have told me that they treasure retention of the AWB and/or its functions. The hon. Member for St Ives (Andrew George) is not in his place, but he made a valid observation: if not the AWB, what? The Minister should answer that, because the issue is not just the minimum wage aspect, but the protection of a broad range of functions.

I say in all honesty that most farmers are absolutely well-intentioned towards their employees. Most want to do the right thing, and they want skilled people in the industry. They want to ensure good rewards, because they realise that farm labouring is back-breaking work. It has the highest mortality rate of any industrial sector in the UK, and sickness levels are high, so workers need protection. The hon. Member for Strangford says that he has his ear to the ground, but he opposes the position in Northern Ireland, so if not the AWB, what will protect those workers?

[Jim Shannon]

We have heard about having an ear to the ground and hearing many stories, but my responses on this issue have been clear. The AWB is unnecessary and does not provide the support that it should to workers. The hon. Gentleman is right in saying that farmers are interested in their workers and want to do the best for them, which they do. I tried to reflect, in my contribution, that that is what the people are saying, and that is what the majority of elected representatives in the Northern Ireland Assembly are saying. Unfortunately, although the majority of people want the AWB removed, under the partnership Government, the Minister can overrule us. That does not reflect the opinion of all those in Northern Ireland, which is the point I am trying to make.

[Huw Irranca-Davies]

I fully appreciate that point.

In all debates on this matter, I have striven, in my position as a shadow Minister, to speak not only for England, but for other parts of the UK in which what is happening with the AWB is mirrored or contradicted. I want to ask the Minister how negotiations are going with Wales. How are they progressing, or not progressing? The Welsh Assembly Government, the Farmers Union of Wales, the young farmers of Wales, Unite the Union, GMB and others have lined up alongside individual farmers to demand the retention of the AWB’s functions in Wales. To that effect, an excellent debate, which I mentioned earlier, was held last week, spearheaded by Mick Antoniw, the Assembly Member for Pontypridd, who is a brilliant advocate for all workers, including agricultural workers. The only dissenting voice in the whole of that debate was not a Liberal Democrat or a Plaid Cymru Member; it was a Conservative, who had been sent out as a token to speak against the retention of the AWB’s functions in Wales.