Introduction of a Maximum Wage

Debate between Jim Shannon and Iain McKenzie

Tuesday 10th February 2015 Westminster Hall

[Jim Shannon (Strangford) (DUP)]

I apologise to the hon. Member for Inverclyde (Mr McKenzie) for not being here at the start of the debate—I was at a Bill Committee that I am serving on. I am conscious that that Committee will have several votes. I apologise to the shadow Minister and Minister because I will have to leave early, if they do not mind.

I am privileged to contribute to this debate on a maximum wage. I will try to strike a balance between the need to bring up the wages of those on poor pay and the need for those on very high pay to consider those further down the ladder, so to speak. The issue is very sensitive. At a time when many people are struggling to make ends meet, find employment or put food on the table, sections of society are earning disproportionately large and astounding sums of money. We have seen the rise of the slogan “We are the 99%” and much theorising about how much the 1% earns, but we must be careful about how we handle this issue. We should proceed with empathy and tact.

The Prime Minister said on TV and in the papers today that we must encourage businesses to give their workers more money. It is good that we are having this debate, because it enables us to focus on the important things. We need to consider what benefit a national maximum wage would have for our social capital. It will make more people feel that they live in an economically just society and help to create a more equal society. However, there is no point in narrowing the gap between the highest and lowest earners if the wages of the lowest earners do not increase. That is what we have to do, and that is the thrust of what the hon. Gentleman said.

Nobody in this Chamber would argue that the gap between our highest and lowest earners is not vast and that it does not have to be addressed. However, we must balance fairness and competitiveness, and take into account the potential spill-over effects of moving towards a maximum wage. We need to minimise economic harm, while healing our social fabric.

The highest earners in our society are often those in charge of large corporations. They are the CEOs of companies that create jobs and contribute to growth, and we commend them for that. When we decide on a cap, it should not penalise those individuals. However, we cannot put on the back burner the fact that the disparity in earnings is UK-wide, and that its prevalence across the globe makes the global wage gap positively monumental.

Income inequalities have been increasing in the short term and the long term, and have been aggravated at both ends of the pay scale. I do not mean that the rich have become poorer in correlation with the decrease in pay of the poorest; rather, the poorest have fallen further behind the average, while the richest have moved further ahead. That is not a criticism of those who earn lots of money, but that gap has to be addressed and I hope that this debate will be a way of doing that.

When we think about introducing a maximum wage, we must consider many issues. First, we need to take into account the regional differences in the cost of living in the United Kingdom of Great Britain and Northern Ireland. Secondly, we must address the critical issue of how to deal with pensions in the private sector. The biggest issue is that we must show that we are not against innovators, strivers and those who create jobs. Job creation helps the economy to grow, provides wages to individuals and helps their local areas to thrive. There is a wider social issue to be addressed, which is eating away at the social fabric of our society. We should not shy away from the challenges of opening such a debate. Undoubtedly, it will be difficult to harmonise everything at stake, but that does not mean that we should not make an effort to do so.

It is of great concern that the public perception of corporate executive wages has become so intense that they have been labelled “institutionalised robbery”. It is hard to argue that there is not something unsettling about the disparity between executive pay packages and average wages. Regardless of the hard work of executives in running companies or corporations, it is difficult to justify the fact that some chief executives receive more than £6 million while their employees live hand to mouth in minimum wage jobs.

There is also the issue of performance-based bonuses, which affects the banks in particular. We have seen the general public in a frenzy about the fact that those they see as most visibly to blame for the economic crisis are being rewarded, while their own wages are either being pushed down further or do not exist due to redundancy. The fact that more directors are choosing not to accept their bonuses signals that there is a sense among the highest paid that the gap has become too big. I congratulate those at the higher levels of companies who have refused to accept their bonuses.

To reiterate, the proposal is to put a cap on the maximum wage that can be paid to a person in any one year, as the hon. Gentleman said. It is important that we address this issue. There are various means by which we could do that—perhaps through proportionality. It does not have to be arbitrarily about fundamental equality; it can be about increasing fairness and narrowing the gap.

[Mr McKenzie]

Does the hon. Gentleman agree that it is abhorrent that millionaires, if not billionaires, are running large enterprises on the back of zero-hours contracts for their staff? In these days of austerity and food banks, they are running empires on zero-hours contracts.

[Jim Shannon]

The hon. Gentleman is right. Everybody in this Chamber is concerned about zero-hours contracts and the many other disparities that need to be addressed. I thank the hon. Gentleman for his intervention, for securing this debate and for giving us the chance to make our comments.

Although I support the principle of a maximum wage, I have concerns about how we would introduce one without its having a detrimental effect on our competitiveness. We must ensure that we raise wages in a way that enables companies to progress. I believe that that can happen. We have seen some small changes in the past few weeks and months. It is important that we enable people to achieve as much as they can. We cannot allow a maximum wage to result in complacency about raising bottom-level wages.

The United Kingdom, and Northern Ireland in particular, must compete internationally. We need big businesses to draw in investment as well as the best and the brightest. We must create jobs by attracting people willing to set up corporations. The last thing we want is to deter those people on the basis of a superficial narrowing of inequality, so any reform must bring about substantive social and economic effects. It must increase the lowest wages in a company, or at least make earnings proportionate to the lowest earner in the corporation.

The hon. Gentleman said that the average FTSE 100 chief executive officer is now paid 143 times as much as their average employee. In 1998—that does not seem so long ago for those of us of a certain vintage—the average was only 47:1. The increase from 47:1 to 143:1 in 17 years has resulted in a massive disparity. Average wages are not increasing, even in companies run by CEOs earning 143 times their employees’ wages. Those companies evidently have money in excess, but still there has been little or no change in average wages, and there is only a marginal chance that they will increase.

Last October, the Business Secretary granted powers that were supposed to require a firm’s remuneration to its executives to have the support of 50% of its shareholders. However, they failed to cap the maximum salaries going to executives, and they did not prevent the pay of the average FTSE 100 chief executive from increasing by £600,000 between 2012 and 2014. In contrast, figures from the Office for National Statistics show that the average pay in the UK is £26,500. A worker in a full-time job earning the hourly minimum wage of £6.31 would get an annual salary of just £13,124. I believe, as the Prime Minister said today, that we need change. We need business to pay more to those at the lower wage levels.

I am curious about why, in the space of less than two decades, such a monumental rise has occurred. It is not surprising that the everyday worker is discontented and looking for us to take action. That is why this debate is being held. The High Pay Centre has called for a debate on more radical measures to address the widening income discrepancy in the United Kingdom.

[Mr McKenzie]

The hon. Gentleman asked why the difference has increased so much in the past decade or so. Could it be that there is a bidding war for chief executives, with each company bidding more to attract a chief executive to stay for a minimum number of years before they move on?

[Jim Shannon]

It is always hard to speculate on the reasons, but chief executive officers are much sought after—and yes, there does seem to be a bidding war. Unfortunately, in that bidding war those in the company who do the hard work and get their hands dirty are being left behind, and that greatly concerns me. At the very least, we need to acknowledge what is going on in order to open a discourse on solutions, whether they be the national maximum wage or an alternative.

In conclusion, I urge the Minister to consider the fact of inequality, shown by all the figures that we have heard and will hear in today’s debate. On top of that, when we consider a maximum wage to decrease the gap between the highest and lowest earners, we should also think about the prospect of decreasing the gap through bringing the bottom range up. I believe we have a duty to be compassionate and a responsibility to ensure that those in the bottom levels have their wages increased. Again, we must tread carefully. We have to address this social grievance and take it seriously, but we must also be ambitious in doing that in such a way that the United Kingdom of Great Britain and Northern Ireland is still seen as a place for fruitful investment and business prospects.

I thank the hon. Member for Inverclyde for bringing the matter forward for consideration. I apologise to you, Mr Streeter, to the shadow Minister and the Minister —my phone has been going like nothing ordinary; I am being summoned to vote in the Bill Committee. With your agreement, Mr Streeter, and that of the shadow Minister and Minister, I beg leave to retire.

Fuel Prices

Debate between Jim Shannon and Iain McKenzie

Wednesday 21st January 2015 Westminster Hall

[Mr McKenzie]

The hon. Gentleman makes a good point, which I will emphasise later in my speech. We need to focus on that issue as much as on competition.

Not all the independent retailers that closed were small fuel outlets; in my area many were owned by well-known oil companies such as BP, Texaco and Esso, whose outlets are now scarce. In fact, some have vanished entirely from our roadsides, and it can be difficult to understand the pricing of those that remain. A classic example is the two BP filling stations in my constituency, which are within three miles of each other. Unbelievably, their prices vary by 3p. Work that one out. However, BP tells me that it franchises the filling stations and allows the franchisees to set their own pump price, and therefore there are differences, although the public will look at the name on the forecourt and assume that they are run by the same organisation. Remarkably, the prices at those two franchise filling stations are always higher than at the supermarkets. How much longer will they be trading?

[Jim Shannon (Strangford) (DUP)]

I congratulate the hon. Gentleman on securing the debate. This issue burns for people in my constituency, because the cost of fuel is enormous for those who need a car to get to work, social activities or school. Does he share my concern that, whenever fuel prices rise, within 24 hours the forecourt prices go up, yet when there is a massive decrease in fuel prices—oil is down by some 60%—we do not see a drop in prices at the forecourt? Why is there such an emphasis on cost when fuel prices go up but not when they come down?

[Mr McKenzie]

The hon. Gentleman makes a good point. We have seen that in the energy market, too. The blame is always placed on the wholesaler, but the problem is that we do not have evidence to substantiate whether that is where the blame should lie. I will go on to ask the Government to investigate the wholesale price of petrol.

The supermarkets have a much-voiced three-mile radius of competition—they tell us that they will match prices within three miles of each large supermarket. Of course, for my constituents that realistically means matching prices with themselves, because there is no one in that radius to challenge them on their pricing. Is that competitive? No, because competition was killed off many years ago.

In early November 2014, Asda, Tesco, Sainsbury’s and Morrisons all rushed out plans to cut prices at the pumps by 1p a litre. In stark contrast, the RAC called for a further 4p cut in unleaded and 2p cut in diesel, to be fair to motorists. The campaign group FairFuelUK has called for a Government inquiry to get to the bottom of the price fluctuations in fuel. Will the Minister consider adopting Labour’s calls for the Competition and Markets Authority to start the process of launching an inquiry into petrol pricing on the forecourts? She might want to support the Road Fuel Pricing (Equalisation) Bill, which the hon. Member for Wyre Forest (Mark Garnier) introduced yesterday using the ten-minute rule. At a time when we are asking the Government to look favourably on protecting dairy farmers from supermarkets, why not protect motorists, too?

The next area that I would like to explore is the supply chain from extraction, refining and transport to the pump. Just where are profits and investments being made? Can we identify where the price is being hiked? As we have seen in the past couple of months, the oil price per barrel has dropped significantly. My rough analysis of the supply chain suggests that exploration costs make up about 5%, capital costs—leasing buildings and rigs, and so on—make up 20%, and paying staff and transport costs and so on makes up 10%. Then there is tax of some 40%, and oil company profits make up the final 25%.

BMI Pension Fund Compensation

Debate between Jim Shannon and Iain McKenzie

Wednesday 17th December 2014 Westminster Hall

[Jim Shannon]

I thank the hon. Gentleman for his explanation, which helps to clarify the matter.

As a good-will gesture, Lufthansa agreed to pay £84 million in compensation, which staff were offered as a one-off cash payment or which could be added to a defined contribution pension scheme. However, staff were then informed that any cash payments would be taxed. Clearly, there is an issue there. Lufthansa was also advised that it would not have to pay national insurance on cash payments, even though members of the BMI pension scheme were not direct employees of the German airline.

Understandably, that has caused a lot of frustration among former BMI employees. As far as they are concerned, they worked for x years and paid x into a pension scheme, which they are now entitled to, but because of dealings between the parent companies, they are now to lose out. We are here for justice and fair play for our constituents and for those who have been disadvantaged.

At the time, BALPA, the pilot’s union, said:

“Pilots in bmi are rightly outraged that their pensions are to be significantly reduced. These pilots have invested their careers in this airline, and a large proportion of their salary in its pension scheme.”

That is how its members felt, and they still feel that way, because the issue has not been sorted out.

The BMI Pensions Action Group was set up to seek justice for employees who were disadvantaged by the company buy-over. When the possibility of BMI’s sale first arose in autumn 2011, BALPA sought assurances, and reassuring noises were made by Lufthansa, which said that there was nothing to worry about, and the UK Pensions Regulator said it had powers to hold companies to account. Members of the scheme received no communications after December 2011, when Lufthansa said it was going to retain the pension obligation. Those in the scheme were led to believe that they were okay, but they clearly were not.

[Mr McKenzie]

The hon. Gentleman is making some good points. I am sure he will agree that the people involved have been shabbily treated. Here we see another example of people being asked to prepare for their retirement and old age, but when they near that point, their pension is ripped from their grasp. Perhaps the Minister could take the issue away—we are talking about 4,000 people, not 4 million—and look again at the issue of taxation being applied to what compensation people have received.

[Jim Shannon]

The hon. Gentleman’s point is clear. It is disgraceful that those whom we represent have been treated shabbily, to use his terminology. Like the hon. Member for Edinburgh North and Leith and my right hon. Friend the Member for Belfast North (Mr Dodds), I ask the Minister to review the situation, because we are talking about 4,000 employees. The Government did that for Equitable Life, even though they said they could not. Members asked in Westminster Hall for that to happen—every one of us here today was probably here for Equitable Life’s members, and we are here today for the 4,000 BMI workers who have been disadvantaged.

Defence in Scotland after 2014

Debate between Jim Shannon and Iain McKenzie

Tuesday 18th March 2014 Commons Chamber

[Jim Shannon]

I have not had that opportunity personally, but I have through third parties. I know that my friend and colleague, the hon. Member for North Down (Lady Hermon), has businesses in her constituency that have clearly told her and their staff that Scottish independence would have a detrimental impact on them, and some of my constituents work for those companies as well.

The report continues:

“On current UK Government plans, by 2020 Scotland will be home to one of three Royal Navy main bases, including all its submarines, one of the British Army’s seven Adaptable Force Brigades and one of three Royal Air Force fast jet main operating bases.”

That is the role Scotland can play in defending the whole of the United Kingdom— Northern Ireland, Wales, England and Scotland: all of us.

[Mr McKenzie]

I know that the hon. Gentleman spoke in the recent debate on cyber-security. We know about the many hard, physical aspects of defence, but cyber-security is a growing area of concern that is consuming more and more time, resources and money. He spoke at great length and with great knowledge about the subject, so I wonder whether he would care to devote a part of his speech to it today and underline the cost implications and the implications for a country that would not have the same level of defence in its interactions in the cyber world.

[Jim Shannon]

I thank the hon. Gentleman for his intervention. Cyber-security is clearly an important area. Many Members contributed to that debate, and I am no more knowledgeable on the matter that anyone else, but I understand its importance and the potential costs. There is a bigger picture, and I feel that the Scottish National party has unfortunately not taken it into consideration in its quest for the referendum. It must do so very honestly and very quickly.

The defence issue for Scotland is massive. To me, it fully underlines the need for the Union. However, personnel issues must be considered. On a more personal level, the Army base at Ballykinler, just outside my constituency, is due to lose some of its regiment, with the knock-on effect that 300 jobs in the area are at stake. However, the Ministry of Defence has assured me that the base will remain open. That follows lobbying by Members of Parliament and the local council. If that was to be replicated across Scotland, how many jobs would be lost? If Northern Ireland was to become independent—thank the Lord it will not, so long as the people of Northern Ireland have the decision to stay in the United Kingdom of Great Britain and Northern Ireland—those jobs would be lost.

My parliamentary aide has a friend who is based in Scotland in the Scots Guards, along with her husband. She has already said that, should Scotland become independent, she will transfer to England, because she feels that there would not be the capacity for job security and that the uncertainly for her and her husband would be too great. That is what my constituents are telling me. That will be replicated many times if Scotland becomes independent. There is the potential that it will lose many good men and women who are seasoned officers. How much will that weaken its defences?

In conclusion, we are very fortunate to have the contribution that our Scots brothers and sisters make in all the services—the Air Force, the Royal Navy and the British Army. We are very pleased to have them as comrades in arms. What is very clear, however, is this: we are better together, safer together and stronger together, and together we must remain.

Currency in Scotland after 2014

Debate between Jim Shannon and Iain McKenzie

Wednesday 12th February 2014 Westminster Hall

[Mr McKenzie]

The hon. Gentleman makes some good points; but the main thing is that the Scottish Government believe they can do anything they want.

Losing the pound would mean a higher cost of living, with higher mortgage repayments, higher credit card and store card bills and more costly loans, because Scotland would start out as a separate state with no credit rating. There would also be an unnecessary threat to jobs: what would the exchange rate be? The cost of changing money every time Scottish firms were to buy from or sell to our biggest customer—the rest of the United Kingdom—would be an issue. There would be deeper cuts or higher taxes as the Scottish Government paid more to borrow money, leading to more debt and lower public spending. There would be risks to benefits and pensions as payments were converted into a different currency. Many people worry about what currency they will be paid in and what their savings will be worth.

There would also be risks to the economy. Without the back-up of the rest of the UK following the world banking crisis, Scottish banks would have gone under and families and businesses would have lost everything. Let us remember that billions were pumped into our banks following the world banking crisis. In my constituency alone, more than 400 jobs were saved. Time is running out for those who want a separate Scotland to give an answer and provide an assurance on currency. The Scottish people cannot be expected to go on any longer with “Don’t worry—it will be all right on the night.” It is not scaremongering to want a direct answer from the nationalists, incorporating a guarantee on currency in Scotland after 2014.

[Jim Shannon (Strangford) (DUP)]

Members representing constituencies in Northern Ireland, which borders another country with a different currency, can attest to the difficulties with prices and services. Does the hon. Gentleman agree that retention of the pound sterling is essential for the continuation of trade, but also for the continuation of the United Kingdom of Great Britain and Northern Ireland?

[Mr McKenzie]

I fully agree. What is scary is the attitude of the nationalists and the yes campaign—an attitude of casually and arrogantly waving off any challenge to their supposed plans. Those plans do not stand up to scrutiny—as we find now on the matter of currency; they would deliver not so much independence as isolation.

The question to the nationalists is simple, but the options are limited. Can they deliver a currency union? All the indications are that the answer is no. Will they go it alone and just use the pound, with the result that they will have no control over the economy? Will they go for a new currency, and will that be pegged or floating? The Scottish nationalists are keen to get closer to the Nordic regions, nations of a comparable size; they always cite Norway, Finland and Sweden, or anywhere in that supposed arc of success, as it fluctuates. In the past 10 years, Norway’s currency, which was pegged against the euro, has fluctuated, and there has been a high degree of movement, and cost implications, as a result. Alternatively, will the nationalists adopt the euro—if and when Scotland can gain entry to the EU?

Those questions are as yet unanswered. Scotland needs to know from the yes campaign what currency—guaranteed—would be used after 2014. We who want to remain part of the UK can guarantee Scotland’s currency after 2014; it will be the pound, and all that is necessary for that to happen is to vote no in September.

Cost of Living

Debate between Jim Shannon and Iain McKenzie

Wednesday 27th November 2013 Commons Chamber

[Mr Iain McKenzie (Inverclyde) (Lab)]

It has become evident from today’s debate that the Government are incapable of making any real changes to improve the cost of living for our hard-pressed families up and down the country. Nothing seems to be changing for those people who, as they have told me, see the Government putting the wrong people first. The only growth people have seen on the high street has been in prices and in pawnbrokers, payday loans, cash-for-gold companies and betting shops.

As has been said, prices are still going up faster than wages. That has been compounded by the fact that many of my constituents have experienced wage freezes over the past couple of years and/or have been moved to reduced hours or part-time working.

[Jim Shannon]

The hon. Gentleman mentioned payday loans, which are a scourge if ever there was one. Some 33% of people borrowing payday loans do so just to pay their basic household bills—just to live and get through the day—while 44% are borrowing to pay for their gas and electricity. Is that an indication of our society?

[Mr McKenzie]

Absolutely. The hon. Gentleman is spot on about that indicator of what is happening in society. I will develop that theme further.

Last April’s increase in the personal allowance does not make up for what families have already lost through tax and benefit changes. The cost of living is rising four times faster than earnings, on the back of a fall in real wages since this Chancellor took office. People are getting worse off, and the cost of living crisis is hitting hard-working families up and down this country. Families in Britain have taken a pay cut of £1,200 a year.

What do families face week in, week out as they struggle to overcome the cost of living crisis? I will give some examples to highlight the severity of the squeeze on living standards. On the basic weekly shop for food and clothing at the supermarket, families are seeing less go into the shopping trolley and more go into the till. Some families no longer do such a one-stop shop, but flit from supermarket to supermarket to cash in on the bargains and stretch their pound even further. There are growing crowds around the mark-down shelves, buying food that must be consumed that day. That is surely an indication that people are living from hand to mouth. Citizens Advice has also produced evidence on food shopping:

“On average UK households purchased 4.2 per cent less food in 2011 than in 2007 while spending 12 per cent more.”

Families are facing record energy bills, while energy companies are enjoying huge profits. Only Labour is committed to freezing prices, not freezing families. At my surgery last week, many constituents came to me with their power bills, concerned about how they would pay them. That is at the start of winter. Goodness only knows how they will pay their bills at the end of winter. Again, I will quote Citizens Advice:

“Over the last three years the average domestic dual fuel energy bill has increased by 37 per cent.”

That is a massive hit on family budgets.

Fuel prices are about 5p or 6p higher in Inverclyde than just 20 miles away. The pricing in my neck of the woods is unbelievable. There are different prices even within the boundaries of the town. The prices for one company vary from one end of the town to the other. The higher prices are predominantly in the areas where people can least manage the rising price of fuel.

A big indicator of the cost of living crisis is the increase in the number of people who are turning up at the doors of food banks. It is a national disgrace that there is food poverty in one of the world’s largest economies. In Britain today, some 13 million people live below the poverty line. The number of Scottish families that attend food banks has risen by 100%. In my constituency of Inverclyde, the number of people using food banks has increased dramatically and shows no sign of falling. The fact that 50% of those who go to food banks are in work is shocking.

What can I say about the impact of the welfare changes on my community? They have taken some £2 million out of the local economy. That money was spent on essentials such as food and clothing. That is having an impact not only on the families affected, but on high streets and shops because it threatens the survival of small businesses.

Where will the squeeze on living standards lead? It leads either in the direction of debt or towards desperate acts, of which I see more and more. In Inverclyde, one recent act—a metal theft, which we see up and down the country—sums up the desperation of families to get money to subsidise their income. Some copper cabling, worth a mere £30, was stolen from a substation in my constituency, plunging dozens of homes into darkness, leaving many people without heating and causing one home to burn to the ground—all that for £30! It was a senseless act, but for what reason? Struggling—that is why I believe that crime took place and put in danger not only the lives of those who perpetrated it, but those of the people living on that estate. Only the kind-heartedness and community spirit of the people of Inverclyde will ensure that the family who have lost their home and possessions will have a Christmas and a roof over their heads.

I know that many other Members wish to contribute to the debate, so I will conclude by saying that times are hard, living standards are definitely falling, and the Government’s economics are failing.

Women’s Pensions

Debate between Jim Shannon and Iain McKenzie

Tuesday 8th October 2013 Westminster Hall

[Mr Iain McKenzie (Inverclyde) (Lab)]

It is a pleasure to serve under your chairmanship, Mrs Main. I was delighted to be granted this debate, which is extremely relevant and important to many thousands of households across the country, including in my constituency of Inverclyde. I also thank the Minister for his time today.

In these uncertain times, when it can be difficult to find a good employer, and a good employee pension is even more difficult to find, many could be forgiven, as in the past, for counting on their state pension—an agreement they believe will deliver on their regular contributions. “Thank goodness,” they might think, trusting that all those deductions from their pay over the years will finally secure a reasoned and equal pension in retirement. They could never have foreseen or taken into account the Government’s recent pension reforms, which many believe to be unfair. I am, of course, talking about the reforms to the state pension age, and particularly how those reforms have disproportionately affected women born in the early 1950s.

The Government’s intention was to introduce a single-tier state pension from April 2017, but as the Minister will be aware, in this year’s Budget that date was brought forward to April 2016. I accept that that is good news for thousands of women, but it still excludes the group on which I am focusing. I believe we all welcome the single-tier pension, but there is one major injustice that can be identified within that new system. Implementing the single-tier pension on 6 April 2016 means that there is a group of women born between 6 April 1951 and 5 April 1953 who will not be eligible for the single-tier pension, even though a man born on the same day will qualify, because the pension age will be unequal on implementation day in April 2016.

The Government’s changes to the state pension have consistently hit hard-working women, and now the single-tier pension will let down 700,000 women across the UK. That is simply not good enough, and it is unacceptable to that group of women. For the single-tier pension to be successful and to achieve its designated goal of equality, it should treat women and men of the same age equally. When the Government’s White Paper was originally published, my hon. Friend the Member for Cumbernauld, Kilsyth and Kirkintilloch East (Gregg McClymont) was quick to spot the issue. He identified that, as a result of the 2017 implementation date, 429,000 women will not receive the flat-rate state pension, even though a man of the same age will.

[Jim Shannon (Strangford) (DUP)]

I congratulate the hon. Gentleman on bringing this matter to the House, and I look forward to the Minister’s response.

Does the hon. Gentleman share my concern, as I suspect that he and many others do, that some ladies will have to work to the age of 72, or possibly 73, thereby holding back a job from an 18-year-old, who will be put on jobseeker’s allowance? Is there not a better way of balancing the issue?

[Mr McKenzie]

The hon. Gentleman makes a very good point. The age to which such women are being asked to work will affect not only them but younger generations who are looking for jobs. I will expand on how working longer affects longevity, and how the argument about longevity does not apply to all of those women.

It is important to note that 80,000 women born in the early 1950s have already had their state pension arrangements changed by the Pensions Act 2011. Surely the Government cannot continue to claim that the new Pensions Bill is fair. What is the Government’s justification for making a change that is unfair and unjust for hundreds of thousands of hard-working women across the UK?

In my constituency alone more than 600 women born on or after 6 April 1951 and before 6 April 1953 will be deprived of, on average, £884 a year, which I think we can agree is not an insignificant sum to lose out on in these tough financial times. Those women are rightly angry at what they see as the dual adverse impact of an increase in their pension age and their non-eligibility for the single-tier pension. I have met many of the affected women in my constituency, and they have expressed their dismay and disgust at the policy. Possibly the phrase that best describes the fate of those women is “So near, yet so far away.” How would the Minister and his Government colleagues feel if, after planning for their retirement date and making what savings and plans they could, they were told they had to work for longer and would be excluded from the new single-tier pension scheme? I suspect they would agree that it is simply not fair.

These women, most of whom left school at 15, have been paying into the system year after year after year. They have made the necessary savings and plans for their retirement, and above all they have spent a lifetime working hard, paying taxes, keeping a home, caring for their families and, naturally, looking forward to their retirement. With all of that, they hoped and expected to receive their state pension at the age they had come to expect. Those women will now be forced to wait longer to retire, and they will miss out on the new £144 a week single-tier pension for the rest of their lives; indeed, they will now receive about £127 a week. Once again, does the Minister find that fair?

Although the coalition Government are fond of quoting a figure of some £4 billion as the overall cost of including these women, the Department for Work and Pensions published an estimate showing that the true cost is closer to £220 million. In his evidence to the Select Committee on Work and Pensions, the Minister agreed that those women will be financially worse off than a man of the same age. He also stated that 90% of those women would fare better because women live longer. It is a weak point for the Government to claim that those women may recoup the money they lose out on because women live longer. Life expectancy differs vastly across the country. Life expectancy from boundary to boundary in my constituency varies hugely—by as much as 10 years—which means the policy is extremely unfair and unequal for the women I represent.

Women born in Inverclyde in the 1950s have worked in some of the toughest industries our country has ever seen. Mills, sugar refineries and shipyards are extremely heavy industries that have had a huge impact on the health of women in my constituency, resulting in a much shorter life expectancy than in other parts of the UK. Even late in their employment life many worked in the electronics industries, which are perceived by some to be less demanding and hazardous than the industries of the past. The electronics industries, however, still exact a health toll on my constituents and reduce the longevity of the women who transferred their skills from the mills, sugar refineries and shipyards to the sunrise electronics industries of the 1980s and 1990s. Those women might have worked alongside chemicals, for example, that we have now discovered eat holes in the ozone layer and are thus banned from use even in aerosols. We are yet to acknowledge, accept or see the effects on their health.

The industries of the ’80s have yet to produce their health casualties, but the evidence thus far paints a bleak future for many hard-working women in my constituency. We need only ask the women who are fighting past employers for recognition of responsibility for cancer clusters to know that, for many, catching up on their pensions will not be an option. If that level of inequality in working conditions and life expectancy exists within a community the size of Inverclyde, it beggars belief to imagine the differences facing larger communities throughout the United Kingdom.

Let me tell Members about Mrs Angela Hurrell, who lives in my constituency. Angela was born on 26 March 1953. Her retirement plans have changed drastically, as she will not reach pensionable age until 6 March 2016—four weeks before the introduction of the single-tier pension. Angela will now work until she is 62 years and 11 months old, and she will receive the old pension figure of approximately £127 a week. She will be £884 a year worse off than a woman born just 10 days later. For her, it is truly a case of so near, yet so far away.

Let me also highlight the case of Angela’s friend, Mrs Maureen Hamill, who is also a constituent. Maureen is a hard-working self-employed local business woman. She was born on 27 March 1953, and her retirement plans, like Angela’s, have changed drastically. Maureen is on her feet all day and works long hours. She does not have the luxury of reducing her working hours, which means that if she is unable to work, her business closes. Despite all that, Maureen will also be excluded from the single-tier pension. Again, she seems to have been born too early, to be retiring too late and to be £884 a year worse off. We can see a pattern forming: so near, yet so far away. I hope the Minister will agree that that does not sound like the fairer system his Government promised.

Angela and Maureen are no different from the hundreds of thousands of other women from across the country whom I could have mentioned. As with many women close to retirement age, every pound is important to them in these difficult financial times. They are but two examples of ordinary, hard-working women in my constituency who deserve to be treated fairly. They simply ask to receive the same improved pension a man the same age will receive.

The inclusion of the women I have talked about would allow the Government to fulfil one of their goals: a universal new state pension built on fairness and equality. I accept they have improved the Pensions Bill, but if the parameters have been changed once to include thousands of women, why can they not be changed again, so that we can end the inequality for the women I have talked about? I urge the Minister and the Government to think about the examples of Angela and Maureen and about the 700,000 women across the UK who share their circumstances. I hope the Government will reconsider. Let it not be so near, yet so far away for these 700,000 women.

Childhood Obesity and Diabetes

Debate between Jim Shannon and Iain McKenzie

Wednesday 24th April 2013 Westminster Hall

[Jim Shannon (Strangford) (DUP)]

It is a pleasure to take part in the debate. I have several things in common with the right hon. Member for Leicester East (Keith Vaz), not least that we support the same football team. I have done so since 1969, and I hope we shall be in the premier league next year. The second thing is that we are type 2 diabetics, as a result of our lifestyle—from about the same time, as I became a diabetic some five years ago.

I acknowledge that I am a diabetic because of the lifestyle I had. Hon. Members may know the experience of being offered a well man check by the doctor, who always says there is good news and bad news; we say, “Tell me the bad news first.” The doctor five years ago told me, “The bad news is you are diabetic. The good news is you can manage it if you really want to.” That was the thrust of it. He said “You can ignore this, and shortly you will be on tablets, and then on injections.” He was not scaremongering, but just wanted me to know exactly what the condition meant. He said, “Your diabetes will not kill you, but what will kill you will be all the things that come from it: your blood pressure and heart, or amputations and stress levels.” I know fine rightly that I became a diabetic because of my lifestyle five years ago. The fact is I love Chinese food; five days a week I had a sweet and sour pork and two bottles of Coke. It never changed—I like it, and so that was what happened. As well as that there was all the stress of the job—previously I was an Assembly Member in Northern Ireland, and a councillor. I love long hours, and they do not bother me at all—and that probably applies to every other hon. Member; the hours were not an issue, but the stress is.

Clearly I had to make changes. Looking back into my ancestry, no one—not my mother, father or grandparents—had diabetes. I was the first in my family, so the cause was clearly my lifestyle. I make that point because of the question of heredity and the hope that I would not pass on my difficulties to my children or my wee granddaughter, four-year-old Katie-Lee. The question is how to instil in children and grandchildren the necessary control, so that they eat the right food, in the right way. I was on diet control in January, and am now on two Metformin tablets in the morning, and two at night; there is nothing graceful about growing old. We may need tablets to keep us going, and probably most of us in the Chamber are of that ilk. The question for me is what I can do as a grandfather, and as an MP, to protect my granddaughter and children, and everyone else, from becoming diabetic.

The UK has the fifth highest rate in the world for type 1 diabetes in children. That can lead to serious health problems such as blindness and strokes, to name but two. Some 24.5 children in every 100,000 aged 14 and under are diagnosed with the condition every year in the UK. Statistics are real to those of us who are focused on the disease and how to deal with it. The UK’s rate is about twice as high as the rate in Spain, which is 13 in every 100,000, and in France, which is 12.2 in every 100,000. The league table covers only 88 countries where the rate of incidence of type 1 diabetes is recorded. There are around 1,038 children under the age of 17 living with type 1 diabetes in Northern Ireland, and almost one in four of those reached diabetic ketoacidosis before a diagnosis was made. DKA can develop quickly and occurs when a lack of insulin upsets the body’s normal chemical balance and causes it to produce poisonous chemicals known as ketones. If undetected, those ketones can result in serious illness, coma and death. We all know people who have come through that, and I am aware of people who have succumbed to diabetes.

The number of people living with types 1 and 2 diabetes has increased by 33% in Northern Ireland during the last five years; that is the largest increase in the United Kingdom, compared with 25% in England, 20% in Wales and 18% in Scotland. The total number of adults with diabetes—those aged 17 and over—registered with GPs in our small part of the UK is just shy of 76,000, and 1,038 young people under 17 are known to have type 1 diabetes, which is another significant rise. Prevalence in the Northern Ireland population is now more than 4%. Some 10,000 people have diabetes without having been diagnosed with the condition. It is scary stuff, when we realise what is happening in our region. I had occasion to speak about that with the right hon. Member for Leicester East before the debate.

Through my colleague, the Northern Ireland Health Minister, I encouraged the purchase of insulin pumps for type 1 diabetics, which was done last year; we have also encouraged the provision of training for family members, guardians and health staff in the use of the pumps. When a Minister is committed to the issue, things can happen.

I have every confidence in the Minister who is present for the debate. In my short time here I have witnessed her contribution in her role, and her commitment to change and to taking hard decisions. I do not agree with everything that she does, but I admire her commitment to the job, and many things that she has done have not gone unnoticed.

Approximately 90% of the 3.7 million people in the UK diagnosed with diabetes have type 2. I have brought that issue to the attention of the Northern Ireland Health Minister, as I am very aware of the ticking time bomb that diabetes is, and the key initiatives in operation in Northern Ireland. He is clearly doing a great job, including setting aside funding to employ additional diabetes staff—specialists, nurses, dieticians and podiatrists: all help that a diabetic needs, but perhaps not enough. All the hon. Members who have spoken have done so with honesty; if we put all the ideas together in a big pot, perhaps we will find a way forward. We need to instil good eating habits in children that will not lead to diabetes later in life.

Rates of obesity—because that is the twin thrust of the debate—tend to rise with increasing disadvantage across developed countries, particularly among women. In 2006 in Northern Ireland, 18% of children aged between two and 15 years were reported to be obese. In 2008-09, the child health system reported that 5.3% of primary 1 children surveyed were obese. The hon. Member for Southport (John Pugh) said that when we were young, many years ago, for someone to be of a certain size was unusual. It is not any more. In the survey I mentioned, 22.5% of the children were described as overweight or obese. That is a massive number.

We need to educate parents on what they are teaching their children through their lunches and dinners. Some schools in my area implemented a healthy snack policy, where twice a week children were not allowed to bring in crisps or chocolate, but had to bring in fruit or a healthy option. That is fantastic, and it is good that it happens, but some parents pointed out how much more expensive it was. We should consider how to make healthy food more affordable for young families in the present economic difficulties.

[Mr McKenzie]

On that issue, is the hon. Gentleman concerned, as I am, about supermarkets that employ the tactic of making their fruit ripen as early as possible, so that families have to make several trips to purchase healthy options for their child’s lunch box?

[Jim Shannon]

Many parents have made me aware of that. There is a key role for supermarkets and how they do things. When we go to the supermarket—let us be honest—we can always find a multipack of crisps or chocolate. By the way, there is nothing wrong with that as long as it is done, like anything in this world, in moderation. Children love a treat, and why should they not have one if it does them no harm?

Unfortunately, it is more difficult to find a multipack of fruit juice, or bags of fruit on offer or sliced up. It is much handier for parents to pick up a bag of crisps for their child’s break than to take the time to cut up fruit when they cannot afford to buy the pre-cut fruit that they want. I believe that we need to change that by encouraging supermarkets to put regular offers on healthy options, and perhaps by looking at tax incentives to make such options a realistic lifestyle choice, and not just a fad to go for for a wee while.

One of the community groups in my area, the East End residents association, has put on a cooking class for its ladies group, which showed them how to cook healthily for the family in a quick and cheap way. Women of all ages learned how they could cook on a budget, but still provide a healthy and satisfying meal. That is also key, and I suggest that funding might be set aside for community groups and churches to put on such classes, which could make real lifestyle changes to entire households.

Unfortunately, at the moment there are few homes that can afford to have only one parent in work, with the mother at home cooking and cleaning—that now has to be fitted around another job—but we must educate people and teach them that short cuts can be made so that healthy meals and snacks for families are still provided. Will the Minister kindly address that and explain what can be done to educate and help those who simply do not know how to do the best for their families? A surprising number of families cannot do so, so we should try to achieve that if we can.

In conclusion, it is clear that something needs to be done. If there is one message from every speaker, it is that we all agree that something needs to be done; the question is how best to deliver that. Many children and adults will not be able to live a healthy life because of something that they could have made small changes to prevent. I congratulate the right hon. Member for Leicester East on bringing this matter to the Chamber. Many more hon. Members would like to make a contribution, but I can say one thing—every one of us, as elected representatives, has constituents for whom this issue is key. We look forward to hearing the response from the Minister, as well as the speech from the shadow Minister, the hon. Member for Hackney North and Stoke Newington (Ms Abbott).

Growth and Infrastructure Bill

Debate between Jim Shannon and Iain McKenzie

Monday 17th December 2012 Commons Chamber

[Mr Iain McKenzie (Inverclyde) (Lab)]

I firmly believe that there is nothing in the Bill to address the root cause of the problem that faces us—the Government’s economic failure. Our economy is only just back to the size it was a year ago, and we have seen a double-dip recession and increased Government borrowing. Adding “growth” to the title of the Bill will not make it so. Even the Prime Minister admits that we cannot legislate for growth.

As we have seen, the Government’s economic plan has plunged Britain into the longest double-dip recession since the second world war. To cover that, they have hurriedly pulled together this flawed piece of legislation. There is nothing in the Bill to address our problems of economic failure; instead, the clause on employee owner shares for rights will only make it an attack on workers’ rights.

The proposals announced by the Chancellor will allow businesses to offer individuals contracts and a new employment status to make them employee owners. Under that new status, employee owners will receive shares in the employer’s company. However, as we know, there is always a catch: in return, employee owners will have to give up certain employment rights, including those on unfair dismissal, statutory redundancy pay and requesting flexible working and training. The scheme has not won support from the business community; a 33-week consultation had more than 200 responses but only five businesses said they would be interested in taking it up.

Labour is in favour of employee ownership, but not coupling it with slashing employment rights. Doing away with people’s rights at work is wrong in principle and will do nothing to bring about growth in our economy.

There are concerns about the full cost of the scheme. It has been said that

“the cost is expected to rise towards £1 billion,”

and:

“Uncertainties abound like assumptions on take up rates, the average value of shares that are entered into the scheme, the extent of tax planning and the timing of disposals.”

According to the Office for Budget Responsibility, a quarter of the £1 billion additional cost—£250 million—is expected to arise from tax avoidance as a result of the scheme.

Slashing the rights of people at work is wrong in principle and will not help bring about jobs and growth; the proposal is yet another example of how out of touch this Government are. The scheme has not won support from business; it has received at best a lukewarm reception. Not even the CBI supports the proposals and called them

“niche…and not relevant to all businesses.”

As we have heard, the chief executive of Sainsbury’s was not exactly over the moon about them either. He was hardly embracing them when he said:

“This is not something for our business...What do you think the population at large will think of businesses that want to trade employment rights for money?”

We all know what we think about that.

[Jim Shannon (Strangford) (DUP)]

Earlier on, there was a reference to Ebenezer Scrooge. Is it not more a case of the grim reaper going deep into the rights of employees?

[Mr McKenzie]

The hon. Gentleman makes a very good point. There are stark connotations for employees across the country if the scheme is put into practice.