Children’s Wellbeing and Schools Bill
Kim Johnson Excerpts(1 month, 1 week ago)
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Vikki Slade
I thank the right hon. Gentleman for his intervention. In fact, Kathryn from my constituency wrote me a very long email talking about welfare versus education—two totally separate issues. People are really upset and would have been devastated and distraught to hear the hon. Member for Morecambe and Lunesdale (Lizzi Collinge) effectively make them feel like they were some sort of pariah. I was really upset to hear that, especially as I asked home educators in my constituency to listen to the debate and give me their feedback.
I support amendments 195 and 197, tabled by the right hon. Member for Sevenoaks (Laura Trott), which seek clarity that educational activities outside regular school terms should not be subject to this overreach. My children are not subject to them, and children in home education should not be subjected to anything more than the rest of us. Children receiving education out of school should have the same rights to take their public examinations as their peers. It should not be based on a parent’s ability to fund that. After all, the Treasury already saves many thousands of pounds for every home-educated child. New clause 53, tabled by my hon. Friend the Member for Twickenham (Munira Wilson), would provide support for parents by providing for home-educated children to sit any relevant examination and to be fully funded where requested.
I thank the Minister for confirmation on one point: as I sat here this afternoon, I received a letter to say that the challenges faced by summer-born children will now be considered. I would like to pass on the thanks—[Interruption.] Well, I’ll save the rest of it for you.
I was not going to speak about academies, but as I sat here over several hours I received two more emails relating, in particular, to concerns about their governance. I heard the challenge from those on the Conservative Benches about the comments by the hon. Member for Montgomeryshire and Glyndŵr (Steve Witherden) on teachers, but I cannot tell the House how many times I hear complaints about the way staff and whistleblowers are being treated in multi-academy trusts. While I have sat here today, I have heard of another who has been suspended by a multi-academy trust. This is not about them getting better treatment; it is about them getting worse treatment. If teachers are treated badly and leave the sector, that has an impact on our children. It is about the children, not just the teachers.
In summary, I support the principles of the Bill, but I urge the Government to consider the amendments on excessive and potentially harmful requirements imposed on home-educated children. They are common sense amendments that would allow children to be protected without placing undue burdens on families.
Kim Johnson (Liverpool Riverside) (Lab)
I rise in support of the Bill and in support of the amendments that seek to increase access to free school meals, a policy that would make a world of difference to the one in two children living in poverty in my constituency, the most deprived in the country. I also want to pay tribute to the amazing teachers in all the schools in Liverpool Riverside who go above and beyond every single day, not only for the children but for their parents.
Research last summer showed that nearly one in five households with children were suffering from food insecurity. That is made worse by cruel and punitive policies, such as the two-child cap on benefits. Universal free school meals would go a huge way towards immediately alleviating the pressures that these families are facing. In the sixth richest country in the world, no child should go to school hungry and all children should be supported to achieve their full potential.
Some 47% of children in my constituency now live in poverty. If those children lived in London, Scotland or Wales, they would have access to universal free schools meals at primary school. However, because they live in Liverpool, many are forced to learn on an empty stomach. That is indefensible and unfair. The Government should take the opportunity presented by the Bill to put an end to that postcode lottery and extend free school meals for all so that no child goes hungry and no child is left behind.
The evidence is clear: the impact of universal free school meals is life changing. Research has found that they ease the financial burden on families, help children to focus in class, reduce stigma and foster stronger school communities. They far outstrip other policies in all those areas, including breakfast clubs and means-tested free school meal schemes.
Teachers in my constituency have told me about the devastating reality that they see every single day, with children coming to school unable to buy lunch and unable to concentrate or learn properly. No matter how bright a child is or how amazing a teacher is, hungry children cannot learn.
The problem is not just who qualifies for free school meals, but how many eligible children are missing out. Up to 250,000 children who should be receiving free school meals are not, due to a system that is inefficient, overly complex and burdensome for parents and schools alike. Families struggle with complicated registration forms, language barriers and a lack of awareness, with some parents avoiding applying due to stigma or embarrassment. The income threshold of £7,500 is incredibly low and has not risen for many years, and too many families living below the breadline are ineligible to access the support they need.
This desperately needs to change. Providing free school meals would not only guarantee at least one hot meal per day, but ease the financial burden on struggling families by saving them approximately £500 per child per year. Studies show that fewer than 2% of packed lunches meet school food standards, whereas a hot school meal ensures that children receive the nutrition they need to grow, concentrate and succeed. Research has shown that well-fed children perform better academically. Early findings suggest that children from non-white communities or single-parent households are disproportionately unregistered for free school meals, despite being entitled to them.
We should also see this policy as an investment in our future. Universal free school meals are proven to tackle health and educational inequalities, providing a long-term boost for our economic productivity and alleviating pressures on our healthcare systems. If we choose today to spend the money and roll out universal free school meals to all children at primary school, for every £1 we spend, we will generate £1.71 in core benefit returns—it is a no-brainer. We must put an end to the economically illiterate models of arbitrary fiscal rules and recognise what the evidence shows: investing in our children’s future is a sensible financial choice, as well as a just one.
After 14 years of Tory austerity, skyrocketing inequality and the lasting effects of the pandemic, now is the time for bold action. If this Government are truly committed to raising the healthiest generation of children ever, we must start by funding universal and nutritious free school meals for all. We have an opportunity to end the scandal of child hunger in our schools and give every child the foundation they need to learn and thrive. I call on the Government to get behind these new clauses and amendments today so that no child in this country is left hungry, and no child is left behind.
Jodie Gosling (Nuneaton) (Lab)
I rise today in support of amendments 27 and 43 and new clause 1, as proposed by the Chair of the Education Committee, my hon. Friend the Member for Dulwich and West Norwood (Helen Hayes). I agree with her, because the truth of my experience in education over the past 20 years is far different from the experiences and views that we hear from those on the Opposition Benches. At this point, I must refer to my entry on the Register of Members’ Financial Interests, and to my partner’s interests.
In a previous life, I raised a motion at North Warwickshire borough council to convene a multi-agency meeting to tackle knife crime in our schools. In one school, 17 sharps had been found in a school bag in a search that I am told saw school “bouncers”—large men in black suits and ties—stripping through students’ bags and removing sanitary products from girls’ bags in public corridors. I appreciate that we need strong measures on knives in schools, but what really baffled me, and the reason why we moved a motion at the council, was that there was no police involvement, no oversight and no accountability from school authorities. At that time, the school also had one of the highest rates for exclusion and persistent absenteeism in the country. It is not hard to understand the link.
A friend of mine—I will call her Rosie—went to the school and was thriving. She attended regularly and was getting on well. She was then threatened by a classmate with one of these sharps. The culprit was excluded for three days and then put back in the same class as Rosie. Unsurprisingly, she was quite uncomfortable with the school’s decision. There was no accountability and no changes were made by the school. How on earth can a child be expected to focus on their learning when they are scared for their own safety?
Free School Meals
Kim Johnson Excerpts(1 month, 1 week ago)
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Kim Johnson (Liverpool Riverside) (Lab)
I thank the hon. Member for securing this important debate, particularly as we might be about to receive the outcome of the child poverty strategy review. Does the hon. Member agree that we have a postcode lottery at the moment? Three schools in Liverpool posted postcards to the Prime Minister saying that we needed to do away with the postcode lottery, because if you live in London, Scotland or Wales, you receive free school meals. Do you agree that children going to school hungry in the sixth richest economy in the world is a scourge on this country?
Peter Dowd (in the Chair)
Order. Will Members address the Chair, not one another directly, please?
Swann Report: 40th Anniversary
Kim Johnson Excerpts(1 month, 2 weeks ago)
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Kim Johnson (Liverpool Riverside) (Lab)
This month marks the 40th anniversary of the publication of the groundbreaking Swann report “Education for All”. The first of its kind, the report was commissioned to examine disparities in educational attainment and experiences among ethnic minority pupils, and made recommendations to tackle institutional racism in the education system. The inquiry, led by Lord Swann, was launched in response to a number of campaigns against racism in education, in particular the high-profile scandal of educationally subnormal—ESN—schools that disproportionately removed higher numbers of black Caribbean children from mainstream education settings, and wrongly labelled them educationally subnormal.
A mixture of education policy and racist attitudes was responsible for this shocking discrimination. The 1960s was a time of rising immigration, with the post-war British empire’s invitation to the Windrush generation of workers from the Caribbean and its other colonies to rebuild Britain. It was also a time of significant racist backlash, with the overt racism of Enoch Powell and the notions of racial superiority that gained traction in the political mainstream. These ideas worked their way into our national education policy, with the aim of creating and maintaining a two-tier labour force and a deliberately under-educated black population to fill all the menial jobs that white Brits did not want.
This significant miscarriage of justice took place in the 1960s and 1970s, and saw hundreds of black—mostly Caribbean—children wrongly sent to schools that were meant for pupils with severe physical and mental disabilities. These schools had existed since the 1940s, due to the provision, under the Education Act 1944, of appropriate schools for pupils with severe mental or physical disabilities. But by the late 1960s, almost 30% of pupils in ESN schools in London were black immigrant children, compared with 15% in mainstream schools.
It was clear that decisions were being made by teachers, educational psychologists and local education authorities to place these children in ESN schools for reasons other than mental or physical disabilities. Although parents were aware that their children were being forced to struggle against a racist system, most were isolated and not given the information that they needed to make informed decisions about their child’s education. It was not until an Inner London Education Authority report was leaked that the true extent of this shocking discrimination was revealed.
Grenadian educator Bernard Coard took the initiative to write and publish the groundbreaking pamphlet “How the West Indian child is made educationally subnormal in the British school system”, making the leaked ILEA information accessible to parents and communities. Mass community mobilisation as a result of Coard’s pamphlet inspired parents and community organisations to campaign against the now undeniable institutional racism in British schools. That forced the Government to respond, and these schools were eventually shut down in the early 1980s.
Published in March 1985, Swann’s report confirmed Coard’s analysis: the persistence of racist stereotypes, biased IQ tests, a deep misunderstanding of culture and language, and biases in teacher expectations, disciplinary practices and curriculum content were creating significant barriers to education for black children. It challenged the racist myths that black children were less intelligent than their white counterparts, and recognised instead that the structural racism embedded in the British education system was disadvantaging them. Inadequate support for pupils with English as a second language, a lack of diversity in the curriculum, and a significant disconnect between schools and parents from ethnic minority backgrounds were identified as further barriers to black children achieving their full academic potential.
Jim Shannon (Strangford) (DUP)
I commend the hon. Lady for securing the debate. I spoke to her beforehand to ask permission to intervene. I looked at the Swann report, which she has outlined very clearly. Does she agree that although substantial strides have been taken since that eye-opening report, the learning curve for the integration and understanding that we all wish to see must continue, as we strive to ensure that each of us can claim the best of British education, incorporating our own ethnic backgrounds and rich cultural history and heritage? Things are better, but there is still a lot more to do.
Kim Johnson
I thank the hon. Member for his intervention. However, as I will say later in my speech, I do not think that things have substantially improved, as he suggests, for lots of black children in our education system.
The report produced several key recommendations, including diversifying and decolonising the curriculum, more diversity in teacher recruitment, anti-racism training for teachers, more resources for language support, better data collection and monitoring, and a better approach to working with parents and communities to build trust and encourage active participation in pupils’ education.
Predictably, the Thatcher Government did little to progress those recommendations. However, the following Labour Government took some of the lessons learned as a framework for our Race Relations (Amendment) Act 2000, particularly the introduction of the duty for public institutions, including schools, to promote racial equality.
However, we know that many racist barriers still exist in education—from disparities in educational attainment to the school-to-prison pipeline, the adultification of black pupils, to the presence of police in schools and the need for a truly anti-racist curriculum. Today’s patterns of racism, segregation and exclusion in education have evolved directly from the policies and attitudes that drove the ESN scandal. The closure of ESN schools in the 1980s led directly to a rapid expansion in the use of school exclusions. We began to see higher numbers incarcerated in prisons, and the expansion of the use of sets and tiering in education, whereby certain groups of children are increasingly denied the opportunity to sit exams at certain levels and then the opportunity to progress in educational settings, including university.
The establishment of pupil referral units is recognised as another method of systematic exclusion from education. We must be clear: the use of PRUs and exclusions are a symptom of failure of the education system. The disruptive behaviour of a child is a cry for help, not a crime. An education system that does not respond with care and support is an education system that is broken. The number of exclusions have soared in recent years, with children as young as five being kicked out of school. Draconian behavioural policies disproportionately impact on poor children, those living in care, and those from black Caribbean, mixed and Gypsy, Roma and Traveller backgrounds.
Swann’s recommendations for an inclusive education system are more important today, and we must take this opportunity to update the lessons learned and apply them to our current system. The societal impact is still as relevant today as it was in the 1960s and 1970s. Lessons must be learnt on the 40th anniversary of the Swann report in order to put an end to this systemic discrimination. Evidence of the scale of the injustice of children being forced needlessly into ESN schools in the 1960s and 1970s is scarce, but we do know about the impact that misclassification as educationally subnormal has had on survivors, some of whom have joined us in the Public Gallery. I would like to take this opportunity to thank them for all their work in exposing this scandal and campaigning to raise awareness of the racial injustice that they suffered. Their work has already made a huge difference, and they have my commitment to keep fighting for the justice and dignity that they deserve.
We heard from some of the survivors at the event I held yesterday in Parliament. We heard from Noel Gordon, who told us that he was wrongly misclassified as educationally subnormal after a chain of events starting with him being diagnosed at the age of four with sickle cell. He describes being bullied and abused by teachers, running away from school and his mum fighting tooth and nail to get him out, but to no avail. Through his determination, he has achieved several qualifications including a degree.
We heard from Maisie Barrett, who is a natural creative. She described how she needed support with her academic skills and her stutter, but those resources were and still are systematically denied to black children. She has said that her grandchild is a victim of today’s SEND system, just like she was a victim of ESN. She told us that if she had received a proper education, she might have pursued her dreams and migrated to Jamaica, and fought for recognition for being wrongly classified as educationally subnormal.
We heard from Rene Stephens, who was expelled from his mainstream secondary school after his teacher assaulted him and was sent to an ESN school that neglected his academic development. He left school with no qualifications. Deprived of education and support, he has now spent 18 years in and out of the criminal justice system due to his misclassification. He was forced to abandon his dream of becoming head chef at the Savoy hotel. He says he continues to struggle with societal participation as a direct consequence of being denied a proper secondary education.
We heard from Denise Davidson, who described how, even in her innocence as a young girl, she realised that her school was different to other schools. She remembers challenging her educational psychologist, and described how her experiences now help her as a children’s social worker to support vulnerable children in similar positions.
This is not only an historic injustice; it is a living one for all who went through it. Most left school at 16 or earlier, unable to read, write or count, and were denied the opportunity to thrive and achieve their full potential. The survivors of ESN still have significant problems with self-worth and with accessing meaningful, well-paid work after they were denied an education.
Jeremy Corbyn (Islington North) (Ind)
I thank the hon. Member for her excellent speech and for the brilliant event that was organised last night. Does she agree that many brave black parents in the late 1960s, and even earlier than that, recognised the abominable way in which their children were being treated, including people like Bernard Coard who led the campaign against the banding policy in Haringey? At that time, black children were unfairly treated and classified in the way that the hon. Member has described, and we should pay tribute to the brave work of those people and acknowledge the abuse that those families suffered because they stood up for their rights. Her debate today and the meeting she held last night are a testament to the efforts that they put in all those years ago.
Kim Johnson
I thank my right hon. Friend for that intervention, and I totally agree with him about the amazing work that Bernard Coard and all those families were involved in as they tried to seek justice and to enable their children to fulfil their potential. That needs to be recognised.
Opportunities to access meaningful, well-paid work were denied to those children, and they continue to face financial hardship because of the barriers to work for those without an education. This has had an impact on their families. A few have succeeded in the face of adversity, gaining qualifications and better jobs. That is a testament to their strength and determination, but they should never have had to struggle in this way.
I would like to take this opportunity to recognise all those whose campaigning helped to get us here today, as well as the incredible campaigners who were misclassified as ESN and who are fighting for justice. My thanks go to Bernard Coard, who pioneered this campaign; to the educator and anti-racist campaigner Gus John for a lifetime of work challenging racism in the British education system; and to all those parents and communities who organised and fought for change so that our children could receive fair and equal treatment and thrive and achieve their full potential. The incredible No More Exclusions group has done invaluable work shining a light on the injustices of the current system of exclusions, and challenging the racist policies and educational segregation that drive the school-to-prison pipeline.
I want to recognise the work of Frances Swaine and Leigh Day solicitors in their pursuit of justice for the survivors, and thank Professor Leslie Thomas KC, Dr Cynthia Pinto and Professor Christine Callender for their pioneering work in this area. I also recognise the incredible work of journalists and producers Lyttanya Shannon and Sir Steve McQueen for exposing this scandal with the BBC documentary, “Subnormal: A British Scandal” and the incredible “Small Axe” series. We have seen with “Mr Bates vs The Post Office” and Jimmy McGovern’s “Common” just how crucial TV and film can be in bringing miscarriages of justice to light, and I hope the same will prove to be true here and that the momentum from this campaign and these dramas will secure justice for those impacted and change a system still producing the same racist outcomes today.
I hope the Minister will join me today in recognising the wrong that was done to the survivors of ESN. A public inquiry into the scandal of ESN schools is necessary, not only to secure justice for the victims of these historical discriminatory policies, but for us to understand how systemic racism and discrimination take form in our current education system and how we can eradicate them. The survivors and campaigners are calling on the Government to give due consideration to a public inquiry, four decades on from the first public inquiry report into racism in education, to learn the lessons of the past and secure justice for all those whose lives were impacted and who continue to suffer.
Catherine McKinnell
My hon. Friend raises a really important point. One of the reasons why we are so focused on early intervention, particularly for children who have experienced a more socioeconomically disadvantaged start to life, is to help children find their voice, so that they can speak up and be a part of the national conversation. That is what we want for every child in our education system.
I am conscious of time, and I want to address the point that my hon. Friend the Member for Liverpool Riverside raised about the public inquiry. The Government do not currently plan to establish a public inquiry on the policy framework surrounding the placement of children in schools for the so-called educationally subnormal in the 1960s and 1970s.
The 40th anniversary of the Swann report is a timely reminder to reflect on the progress that has been made, but also to ensure that mistakes made at that time are never repeated. It reminds us that there are always ways in which we must go further to ensure that no children or young people today suffer from the structural barriers and entrenched racism that held too many of our young people back in previous generations. I reassure my hon. Friend that we are not complacent; we are committed to delivering a fairer society with better opportunities for all. We firmly believe that every child should know that success belongs to them, which is why we must break down the barriers to opportunity. We are committed to changing the school system so that every child can achieve and thrive.
Kim Johnson
I just wanted to ask my hon. Friend whether she could provide some rationale for why the Government have not decided to go down the route of a public inquiry.
Catherine McKinnell
I think we are out of time, but I am supposed to meet my hon. Friend next week. We can discuss this in more detail then, when we will have more time, but I look forward to continuing to work with her to redress race disparities and work on these issues, which I know she is rightly incredibly passionate about.
Question put and agreed to.
Oral Answers to Questions
Kim Johnson Excerpts(1 month, 2 weeks ago)
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Catherine McKinnell
I know that the hon. Gentleman raises his concern in all sincerity. We will continue to work with all partners, parents, teachers, local authorities and indeed the NHS on how we reform our SEND system and ensure that the support that is needed reaches every part of every community. Our ambition is for a more inclusive mainstream school system that draws on the right education and health specialists to ensure that every child receives the support that they deserve.
Kim Johnson (Liverpool Riverside) (Lab)
Far too many children with complex learning disabilities and autism have been failed by the system and end up having a place not in their local community, but in institutions. That disproportionately affects black children, which is synonymous with the ’60s and ’70s when they were classified as “educationally subnormal”. Will the Minister explain what work is being done to identify the number of children who have been institutionalised? What work has been undertaken to review and amend those situations?
Workplace Pay Gaps
Kim Johnson Excerpts(3 months, 3 weeks ago)
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Dawn Butler (Brent East) (Lab)
I beg to move,
That this House has considered pay gaps in the workplace.
Thank you, Sir Roger. I wish everybody a happy new year, too, and it is a pleasure to serve under your chairmanship.
There are multiple pay gaps in the workplace. I have had emails about the age pay gap, size pay gap and accent pay gaps—as a certified cockney, I know that that is true, and just for the record, some of the most intelligent people I know are cockneys. But today, for Ethnicity Pay Gap Day, I want to focus on gender, ethnicity and disability pay gaps. The key point is that if we measure something, we can fix it, but at the current rate, it will take another 40 years to fix the gender and ethnicity pay gap. Nobody should feel happy about that slow rate of progress; and imagine how long it will take to fix the disability pay gap—it will take even longer.
Last year, the Fawcett Society reported that Equal Pay Day fell on 20 November, two days earlier than the year before, and that essentially meant that from 20 November until the end of the year women were working for free. It is shocking that, on average, women earn £630 less a month than their male counterparts. On social media, people sometimes say, “What is this all about? Are you trying to reduce how much men are paid?” That is not what this is about. It is about fairness and equality and about paying people more, not less. I do not want on social media the manipulation and the misinformation of people saying, when we talk about equal rights and fairness, that that is somehow doing down men, because it absolutely is not. Currently, the ethnicity pay gap is 5.6% and the disability pay gap is 12.7%. That is a whopping pay gap.
The Government are to be applauded for their ambition and plan to make work pay. The Prime Minister said, as part of his new year message:
“The security of working people…is the purpose of this government.”
That is something that we should all applaud: working people should be secure in their job and in their work. Following the King’s Speech, companies of 250-plus employees have to report ethnicity and disability pay gaps, which is welcome. It is also welcome that gender pay gap reporting has been expanded to include equality action plans. That is great, but producing equality action plans is not enough. What will companies do with the action plans? How will they ensure that they use the action plans to close the pay gaps? It is one step, but it does not go far enough.
It has to be acknowledged that what we do now will actually make the workplace better for everybody—not just women, people with disabilities and people of different ethnicities. Everybody will benefit if the workplace is fairer. Research has found that men want flexibility in the workplace. This is always framed as women wanting flexibility in the workplace, but the reality is that men also want flexibility, so if we make that a standard, everybody will be happy. And no matter who is doing the job, doing the work, they should be paid fairly. That should be the case no matter who they are or what they look like, so there also needs to be a concerted effort whereby we stop stereotyping people into jobs or creating structures that try to normalise inequality.
Kim Johnson (Liverpool Riverside) (Lab)
I congratulate my hon. Friend on securing this debate. The Equality Act 2010 states that it is illegal to discriminate on the basis of race, yet in 2024, black people earned an hourly mean rate 19.04% lower than their white counterparts. The Employment Rights Bill provides an opportunity for employers to develop and publish an equality action plan. However, those action plans at the moment cover only gender. Does my hon. Friend agree that the Government need to place more emphasis on ethnicity gap issues, and that that Bill, which is in Committee, needs to make that right by covering them at this stage?
Dawn Butler
My hon. Friend is absolutely right. If our ambition is to make the workplace fairer and secure it for everybody, we should take the opportunities laid before us. That is one opportunity to ensure that we not only close the gap but make workplaces fairer.
There was one case that was easy to identify as a trade union official: men were called chefs and women were called cooks, and chefs were paid a higher rate than cooks. That was an easy one, once we could figure out what was going on. A more difficult case was that of Kay, who said:
“I had been working as a chef with a large catering company for ten years. During a casual conversation, my colleague mentioned he was being paid £22,000 a year. This was £6,000 a year more than me. I thought the right to equal pay would mean I was being paid fairly. For years, I went to work each day without knowing I was being paid less than those I was working alongside. I am not an isolated case. I know there are many women who, like me, don’t realise they are experiencing pay discrimination.”
That picks up on the point made by my hon. Friend the Member for Liverpool Riverside (Kim Johnson). The law is there, but if someone does not know what the person next to them, who is doing the same job, is paid, they could be discriminated against.
Some people will say that some men and women do different jobs, different types of work or different hours. The law says the “same work” or “work of equal value”, but even when men and women work the same hours and in the same roles, nearly two thirds of the gender pay gap remains unexplained. That points to pay discrimination, which we must tackle as a Government. How do we tackle that and move faster towards security, fairness and equality? One way is transparency. It is important for people to know who is being paid what and why. We should introduce the right to know. In Kay’s situation, she should be able to see how much X is being paid and know that there is a £6,000 pay deficit. We also need actionable and enforceable action plans. Again, an organisation may have identified a pay gap, but unless it has committed to closing that gap, that probably will not happen. Another way companies can do that is by assigning it as a key performance indicator. We have found that when organisations assign that to somebody as a KPI, real action is taken and pay gaps begin to close.
The Government have a huge role to play not just through legislation, in terms of the Equal Pay Act and so on, but by securing the circular economy. The Government can have an active role in making the workplace fairer by ensuring, as has been done in some areas, that they give contracts only to companies that pay people well and fairly and do not have a pay gap. So the Government’s procurement contract processes can ensure that they give contracts only to companies that follow good practices, which will enrich the circular economy. This is not just about doing the right thing. Companies that pay people well and employ the right people for the right jobs generally have a 15% higher profit margin than their nearest counterparts. That also plays out in the fact that a lot of young people are becoming socially informed, so they like to shop with companies that have good ethics and consider climate change. This approach will benefit everybody and is good in itself.
As I come to the end of my speech, some may wonder why I have not mentioned fines. The Minister may correct me, but to my knowledge no company has been fined for its gender pay gap. Unless that part of the law is strengthened, it is meaningless. I am interested to know how we can ensure that we fine companies that are not closing their pay gaps, and what the Government plan to do with any money that is collected.
There is a stark difference across UK regions, with some doing better than others. London has the largest ethnicity pay gap, which currently stands at a whopping 23.8%. That is appalling in one of the most diverse capital cities in the world and the financial capital city of the UK. As chair of the London parliamentary Labour party, I want to accelerate the move towards closing those pay gaps. I commend Dianne Greyson, founder of #EthnicityPayGap, for her work on that.
As chair of the all-party parliamentary group on governance and inclusive leadership—GAIL—I launched a maturity matrix in Parliament. That guide is available online for free for companies to implement in their workplace. It takes them through various stages to recognise and close pay gaps. That has been so successful that companies have asked for it to be expanded for disability and other things, which is currently being done. That is a free resource because, ultimately, we want better and fairer workplaces.
People should be paid fairly on merit. No one should be paid less for their work because of their gender, colour of their skin, ethnicity, background, accent, size, age or class. If we get this right on gender, ethnicity and disability, we will create a better and fairer work environment for all.