National Minimum Wage

Julie Hilling Excerpts

Wednesday 15th October 2014 Commons Chamber

[Matthew Hancock]

In 1998, when the Labour Government removed the requirement to regulate levels of leverage in the City, the Conservative party complained, and it was that removal which led to the crash being bigger in the UK. It was the result of poor regulation of the financial sector. Labour did not fix the roof when the sun was shining, but instead spent money they did not have even before the crash.

Instead of forgetting about the deficit, as Labour does, and ignoring Britain’s economic challenges, we know that a strong recovery underpins a strong society and that we cannot have a strong minimum wage without a strong economy.

[Julie Hilling (Bolton West) (Lab)]

I love the way the right hon. Gentleman is rewriting history. Will he explain why we had three years of a flat-lining economy and why it only started to recover when the Chancellor went to plan B and started to invest in infrastructure?

[Matthew Hancock]

The hon. Lady needs to look at the economic statistics: there was no double-dip recession and ours is the fastest-growing economy in the G7. Economic growth has been strong, the number of jobs is growing at a record rate, our economy is turning around and we have the fastest growth in the G7. Labour might want to deny it, but we want to support the plan and, crucially, ensure that economic growth reaches all parts of the country and that all can benefit. That is why we support and are strengthening the minimum wage. We know that the only route to higher living standards is not through more borrowing, more taxes and more debt, but through fair pay for a job well done.

Today was another test of Labour’s economic credibility, and yet again it was found wanting. Instead, the true supporters of the national minimum wage now reside on the Government Benches. First and foremost, a strong minimum wage requires a strong economy.

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[Matthew Hancock]

We know what would be most damaging for the low-paid—if we lost control of the economy and had another great recession like the last time Labour was in office.

[Julie Hilling]

I want to return to the Minister’s point about the number of new jobs being created. I asked him once about this matter and got the following reply:

“Information regarding the number of jobs created is not available. As an alternative…estimates relating to the net change in the number of people in employment are available… Unfortunately the requested information on duration of employment is not available”.—[Official Report, 12 November 2013; Vol. 570, c. 578-9W.]

The Government continue to talk about the number of jobs created, but they do not have the evidence to back it up.

[Matthew Hancock]

The evidence was published at 9.30 this morning. It showed that record numbers of jobs had been created and that in the hon. Lady’s constituency the number of unemployment claimants fell by 32% in the last year. If I were her, I would look at the statistics before complaining about our record on jobs.

True supporters of the national minimum wage know that it is a partnership with business. Jobs cannot be created without job creators. Business is a force for social good, not only because it creates jobs, but because business prospers by finding solutions to other people’s problems. It is something for something, and it is what the British people mean by fairness. After all, the Low Pay Commission was set up because the minimum wage relies on consensus to keep the support of both employers and employees. In fact, the hon. Member for Streatham made that point in his speech, but then sadly undermined it with a policy that I think was probably pushed on him by his leader.

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[Heather Wheeler (South Derbyshire) (Con)]

It was really interesting to hear the hon. Member for Westminster North (Ms Buck) deliver the last bit of her speech, as it was the most promising and uplifting part of the whole thing. The tone of this Opposition debate has been so downbeat. As usual, it is about doom and gloom. The only way out, say the Opposition, is through regulation and for a would-be Labour Government to layer more and more costs on business. Life is not like that. Labour has not learned its lesson. I find it utterly fascinating that, four years into this parliamentary term, we have this synthetic anger and calls for regulation and layering costs on business, not to do the things that our communities need. We need to lift horizons, especially with regard to education.

One of the things that I am most proud about is the fact that we now have a college in South Derbyshire. We have never ever had one before. It was normal for people to leave school at 14. The boys went down the pits and the girls went into the potteries; that is what they did. Well, it is not like that any more, and it must not be like that. If I can get a college in South Derbyshire, surely to goodness, Labour MPs can think about lifting the horizons for their communities. They should think about how people can get better jobs, because they now have better education. We have 1.3% unemployment in South Derbyshire. When the mines shut, we had 25% unemployment. That is a huge change around in the economy of my constituency.

[Julie Hilling]

I get extremely frustrated with this mantra that people should get better jobs. Actually, the precious jobs in our economy include caring, nursing, sweeping our streets and making sure our communities are safe. The people in those essential jobs are frequently on really low pay. We must drive up the amount of money that employers pay them. We should not just say, “Go and get a better job.” Those jobs are essential to our economy.

[Heather Wheeler]

I completely agree with the hon. Lady. All work should be worth doing and worth paying. There is no difference between us on that. How depressing would it be if ever, God forbid, Labour got into power? That is what its mantra is about. Ours is not about that; ours is about sunny uplands.

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[Julie Hilling (Bolton West) (Lab)]

There have been more measured speakers since the Minister spoke, but listening to him was rather like listening to the Comedy Store at times, given the amazing claims he made. It would be funny if it was not so tragic for the many millions of people who are suffering under the policies of this Government. According to the Minister, everything in the garden is rosy. Well, tell that to the million people who have accessed a food bank this year—to my constituent, Neil, an ex-serviceman paid at the national minimum wage who could not afford to buy nappies and needed to rely on a food bank; or to the one in four apprentices who do not even get paid the paltry £2.73 an hour apprenticeship rate, a rate that has increased by only 23p since 2010.

The national minimum wage was a great achievement by the previous Labour Government, and I pay tribute not only to my hon. Friends who are still in this place, but to a great Wigan MP, Ian McCartney, who steered the minimum wage through Parliament in the teeth of opposition from the Conservative party. I wish I could believe the Minister when he says that the Tory party has had a damascene conversion, but the hon. Member for South Northamptonshire (Andrea Leadsom) told us previously that businesses with three or fewer employees should be exempt from the minimum wage, as well as from maternity and paternity rights. The hon. Member for Esher and Walton (Mr Raab) called for the minimum wage to be suspended for 16 to 21-year-olds, and the hon. Member for Shipley (Philip Davies) said that disabled people should be allowed to work for less than the minimum wage. One could argue that those were just renegade Back Benchers, but this afternoon we heard about the disgraceful comments of Lord Freud, the Minister who said that some people “aren’t worth” the full national minimum wage, and that if people want to work for £2 an hour, they should be allowed to.

Another six MPs—including the new UKIP MP—signed a Bill in 2010 calling for employees to be able to opt out of the minimum wage. While I mention UKIP, a week or so ago I had the misfortune of turning on the TV and I found myself listening to a delegate from its conference calling for the abolition of the national minimum wage and the living wage, to resounding cheers from the audience. The hon. Member for Clacton (Douglas Carswell) has already made his views clear, as has UKIP’s business spokesman who said that the national minimum wage was in a long list of workers’ rights that make it impossible to employ people.

[Alec Shelbrooke]

Will the hon. Lady let the House know whether she deplores the use of unpaid interns for more than four weeks of free work?

[Julie Hilling]

I am not going to spend a great deal of time talking about interns. Of course we should be able to pay interns, and we have a real difficulty with people who are on workfare and who are working in different ways. We must work towards ensuring that we can pay interns in some way. I have volunteers—I do not call them interns—and I have no money in my budget to pay them. I will not be purer than pure when talking about this issue.

Even businesses are now calling for a rise in the minimum wage, and a raft of business leaders, including the chief executives of Kingfisher and Nomura, have signed a letter calling for the minimum wage to rise faster. It was signed by Sir George Bain, the former chair of the Low Pay Commission, and Alan Buckle, former deputy chair of KPMG, as well as leaders from household names such as the Findus Group, Stobart Group, Balfour Beatty, and Hewlett-Packard.

I recently held an event for faith leaders in Bolton West. They believe that people at the bottom are not paid enough and that we need to work towards a living wage, not just raise the minimum wage. They also reported a large increase in people turning to churches for help with food, clothing and other support. Not only are people £1,600 a year worse off on average, but the loss of the real value of the minimum wage since 2010 has cost an additional £270 million in extra public spending on in-work benefits and tax credits in the last year alone.

Every time an employer does not pay his or her employee enough to live on, it costs every taxpayer money. I appreciate that some small businesses struggle to pay the minimum wage, but many employers are raking in large profits and not paying their workers the living wage they could afford. That is why we need a Labour Government committed to driving up wages, and who will reward employers who pay a living wage through a reduction in tax. Unlike the Government, we have costed that pledge and know how we will pay for it.

We also need strong action to enforce the minimum wage. The Government have announced their name and shame policy four times, but have named only 25 firms. Last year, the Centre for London found that only two employers in four years had been prosecuted for paying below the national minimum wage, despite more than 300,000 people earning less than that.

On the abuse of the national minimum wage, we are told many stories of employers who will employ migrant labour and make vast deductions for accommodation, food and other things. On paper, they are paying the minimum wage, but in reality they pay far less. That not only exploits those workers, but leads to great damage to community cohesion.

As ever, I want to mention my favourite subject: the abuse of care workers who are paid only for the amount of time they are with a client—they are paid a token amount for travel that does not cover their time, and are usually on zero-hours contracts. That needs to be tackled as a matter of urgency. They do an amazing, precious job. Every day, people such as me entrust the care of our loved ones to those exploited workers. That exploitation leads to instability in the work force. I have previously told the House about the 20 different carers my mum had in less than a month because of workers leaving. That leads to mistakes and a great deal of distress for the cared-for person. Imagine if a person had to tell four different people a day how to care for them.

Many of my constituents from all over Bolton West have come to me with the problems of poverty because of low pay, zero-hours contracts, part-time and insecure work, and agency work. I hope the House supports the motion and that the Government will do better than mere rhetoric.