Lord Haskel
Main Page: Lord Haskel (Labour - Life peer)
Lord Haskel (Lab)
My Lords, I congratulate my noble friend on introducing this debate. We have debated this topic for some years. Many of us will remember the debates we had on how we would use all the leisure time that new technology would create. However, the conclusion we have to come to is that its effect has not been uniformly beneficial. Some of us have benefited but it has also helped create working poverty. Many of the 8.3 million people who, according to the Money Advice Service, have problem debts are in work. Yes, there is nearly full employment but it has not been reflected in our standard of living. All this adds up to a lot of discontent and alienation, and before we start to benefit this has to be put right.
Those of us who have managed people learn pretty quickly that people who have a stake in an organisation—who are valued—tend to protect that organisation. If they do not, they unconsciously want to destroy it. Allowing a small group of people to acquire huge rewards from globalisation and technology while others are left in hardship is asking for trouble. My noble friend made this point.
What to do? First and foremost, you have to give people back their rights at work. The flexible labour market has served its purpose and in these new circumstances it is not benefiting people. Quite simply, the way to do this is to change the system of tax credits and housing benefit which facilitates low pay and discourages investment in people and replace it with higher pay—higher pay through higher productivity, as the noble Lord, Lord Patten, said. Most studies show that productivity is raised with the skills and training that all noble Lords have been calling for in these new circumstances.
The Government are trying but it is not working. The Minister may point to their industrial strategy, which may have some good economics but does not coincide with people’s concept of a fairer workplace. This is because many people at work now see themselves as victims of the disruptive force of technological change. The Government have to champion the argument that this change in the workplace carries a cost to society as well as benefiting corporations.
It is important to understand the nature of investment in these new circumstances. These changes mean that there will be yet more investment in so-called intangible assets: skills and knowledge; design and branding; research and development; and software and artificial intelligence. Indeed, some figures indicate that already more is spent on these hidden investments than on tangible assets such as machinery, buildings and computers. The accounts just do not show this. This applies to manufacturing businesses just as much as service businesses, as Sir Charles Bean pointed out in his report. The point is that this kind of intangible investment is far more scalable than traditional tangible investment. With this kind of investment, we are moving towards a world of “capitalism without capital”, to borrow the title of a forthcoming book which explains all of this.
As a result, the Government will have to play a much bigger role in stimulating and participating in this investment—state intervention, as my noble friend Lord Giddens said—as well as continuing their role in investing in research, training, skills and education; otherwise, inequality and disappointing productivity will continue. The Government have to do a lot better at convincing people that this investment will contribute towards goals that citizens value rather than goals valued purely for science, education or economics.
In spite of the benefits of globalisation and technology, many of us feel that we have lost a sense of direction. We are working hard but getting nowhere. There are plenty of jobs but no money. This is why many feel that the system is rigged against them at their place of work. Without addressing this, we will not enjoy the benefits of globalisation, technology and demography. If this Government cannot get their act together and make the changes, there is another waiting in the wings who will.