Public Bodies (Diversity)

Keith Vaz Excerpts

Thursday 13th March 2014 Commons Chamber

[Seema Malhotra (Feltham and Heston) (Lab/Co-op)]

I am grateful for the opportunity to speak on this topic, which is a key issue not just for equality but for ensuring the best decision making possible for our public services—an area in which I worked in 2009. Civic engagement and the opportunity to play a part in public life are vital for building and sustaining links between all parts of society and our public institutions.

It is nearly 40 years since the Race Relations Act 1976 and the Sex Discrimination Act 1975 were first passed into law to end discrimination on the basis of race, ethnicity or gender in Britain. Since then, notable milestones have been achieved. We have had the first woman Prime Minister, the first black woman in the Cabinet, and the first Asian and Muslim to attend Cabinet in the shape of my right hon. Friend the Member for Tooting (Sadiq Khan).

However, we have not seen commensurate attainment in the public sector as a whole. The most recent “Public Bodies” report published in June 2013 by the Cabinet Office shows a worrying trend of reversal in progress. We all agree that public appointments must be made on merit; the question is whether the processes we have in place are really delivering that. Last year, 1,087 appointments were made to the boards of bodies in the UK, but of those only 56 were ethnic minority individuals. In just one year, black and minority ethnic representation went down from 7.2% in 2011-12 to 5.5% in 2012-13—the lowest level in more than a decade. It is positive that the number of female appointments went up from 33.9% to 35.6% in the same period, but diversity strategies must go wider than gender.

The drop is of particular concern because diversity on public boards has been seemingly high on the agenda for the Government Equalities Office, the Cabinet Office and the Office of the Commissioner for Public Appointments. The 2011 review of the public appointments system addressed the core principles of fairness, openness and merit, and the Public Appointments Order in Council 2013 refers to a duty for the commissioner to promote equality of opportunity and diversity in public appointments. When the commissioner published the diversity strategy last March it was acknowledged that, although progress had been made, the pace of change was too slow.

[Keith Vaz (Leicester East) (Lab)]

I congratulate my hon. Friend on securing this debate and on being the first ethnic minority woman to represent a seat in west London. This issue has arisen under successive Governments and it has been a real cause of concern over a number of years. Does my hon. Friend think that perhaps the problem is that, when Ministers handed over to an independent body the decision to make these appointments, the politics went out of the appointment system, and that those who currently sit on the appointments board are not as attuned to these issues as Ministers would have been?

[Seema Malhotra]

My right hon. Friend makes a very important point. There is a separate debate to be had about the effectiveness of creating of an independent body. Ministers, however, can still take responsibility and I will come on to discuss how the previous Government had targets for public appointments, which I think made a big and important difference at the very highest levels of every Department.

As I was saying, it was acknowledged last year that the pace of change was too slow, yet a year on it is slower still. Last year, the inclusion think tank Diversity UK, led by Dilip Joshi, Lopa Patel and Sushila Khoot—long-standing campaigners for equality of opportunity—undertook a survey to investigate what was happening behind the statistics and launched the findings at an event that I attended and at which there was cross-party representation.

The survey collected the views of ethnic minority individuals and found that the majority of respondents had not applied for a public appointment despite being aware of such appointments and despite 60% of them expressing a wish to apply in the future. When people were asked why they had not applied, their reasons were varied. They did not feel that they were qualified enough or that they had the right skills, which are common responses to surveys looking at people who are under-represented in different organisations and bodies. Other reasons cited for detracting 68% of respondents from applying for a public appointment included the requirement for sector-specific and previous board-level experience and—this is a very important point—little or no feedback from the process and a lack of cultural awareness from executive recruitment consultants. However, respondents also saw the positive opportunity that public appointments can provide with regard to benefiting society and playing a part in our community and national life.

The survey was circulated to approximately 1,500 senior- director level individuals, and the findings suggest a widening “aspiration gap” between the leaders in business and society and the leaders of our public institutions.

In 2003, Trevor Phillips, the then head of the Commission for Racial Equality, coined the phrase “snowy peaks syndrome” to help explain a phenomenon in the civil service. He said we should think of Whitehall as a mountain range: at the base of each mountain, we might find large numbers of women and ethnic minorities, whereas at the summit we will find a small amount of white, middle class men.

Today, more than a decade later, snowy peaks can still be found in many parts of our society, including the public sector. We see it in the NHS, where only 1% of chief executives are from BME groups even though BMEs make up more than 15% of the health service work force.

The Government have done some important work on improving the representation of women on boards in the private sector, but diversity, as I have said, goes wider than gender, and the public sector remains vital, too. Fourteen per cent. of the UK population is made up of ethnic minority individuals and it is time that the Government demonstrated greater leadership on the issue.

Just last month, new research on the corporate sector revealed the widening aspiration gap, with two thirds of FTSE 100 companies still having an all-white executive leadership. Only 10 ethnic minority individuals hold the post of chairman, chief executive or finance director, which is equivalent to 3.5% of roles at that level. A diversity deficit clearly exists in the corporate sector, as it does in the public sector. That deficit also contributes to the lack of growth in developing economies across the world, where our diaspora communities and diversity at board level make a huge difference in building relationships.

The disappointment is that we are still discussing this issue today, when we would have hoped that many of the barriers to the progress of ethnic minority individuals in Britain had been removed. What are the solutions? Lopa Patel of Diversity UK has stated:

“To have declining BME representation at senior levels in the corporate and public sector at a time when BME numbers are increasing in the general population is indicative of failings in the process.”

I agree with the sentiment that the Government must do more to identify and remove what might be institutional discrimination.

It is precisely because of the need to address both demand and supply side issues in the appointments process that the previous Labour Government brought in important reforms and set targets for 50% of new appointments to be women by 2015, and for appointments of BME people and those with disabilities to be in line with their representation in the population. The targets may have been ambitious, but they made a statement and gave a sense of urgency about the need for reform.