Women and Low Pay

Margaret Greenwood Excerpts

Wednesday 18th November 2015 Westminster Hall

[Ruth Cadbury]

The hon. Gentleman is absolutely right: we need action, not words. One of those actions is the living wage—or should I call it the true living wage, so as not to confuse it with the rebranded minimum wage? The true living wage is an hourly rate set independently and accredited annually. It is calculated according to the basic cost of living, not median earnings, unlike the new national living wage. The current living wage is £8.25 an hour, with the London living wage at £9.40 an hour. Employers choose voluntarily to pay the living wage.

Labour local authorities are taking the lead in rolling out the living wage. I am proud of the role I played in Hounslow Council in implementing it for the staff of not only the council, but its contractors, many of whom are women. That is making a difference locally to many women’s lives and workplaces.

During the recent living wage week, my hon. Friend the Member for Stretford and Urmston (Kate Green)—the shadow Women and Equalities Minister—highlighted the importance of fair pay for women on a visit to a group of school meal staff in Camden who had recently been awarded the London living wage. That pay rise was due to a sustained campaign by the Camden New Journal and Unison, which put pressure on the company that employed the women so that it would give them the living wage they deserved. On receiving her pay increase, one of the women was delighted. She said the extra few pounds a week meant she would be able to save a bit of money each month and eventually have enough to go on a family holiday—her first. That made such a difference to her.

That is good for not just the employees, but their employer, which has seen increased staff satisfaction, leading to higher retention rates. Indeed, it previously had high staff turnover, with 40 vacancies to fill last summer; this year, it had only two. That is the point: having a large section of our workforce on a low wage is bad for business and bad for the economy. The Government consultation on the gender pay gap discovered that equalising women’s productivity and employment with men’s could add almost £600 billion to the economy.

The Government have taken some lessons from the last Labour Government. One is that, for most women, childcare is a barrier to labour market participation, and that is even truer of women on low pay. The Sure Start initiative was introduced because Labour recognised that women were more likely to be in low-paid jobs and, therefore, that childcare needed to be subsidised to help them back into work.

It frustrates me that, to help women back into the workforce, there has to be recognition that women’s employment is, on average, less well paid and of less value. Although it is good to see more women able to participate in the labour market, TUC research has shown that more than half the job growth for women since 2010 has been in low-paying sectors. Why is women’s work less well paid? The work that women do is crucial to the functioning of society, but their pay does not reflect that.

Despite the fact that women’s qualifications are as good as, or better than, men’s, they are not rewarded. Women occupy 78% of jobs in health and social care—a sector where the average salary is £40 per week less than the UK economy average. By comparison, men account for 88% of those working in more lucrative sectors, such as science, technology and engineering.

It is harder for women to find good-quality jobs. Evidence suggests that women become “discouraged workers”, resulting in fewer of them working or actively seeking work. They are discouraged workers because they face real challenges in finding decent-quality work, and the work they traditionally carry out, such as catering, cleaning and caring, is too often low paid and undervalued.

[Margaret Greenwood (Wirral West) (Lab)]

I congratulate my hon. Friend on securing this important debate. Does she agree that, with 4.1 million children now living in poverty, tackling women’s low pay is a crucial part of improving the opportunities of those young people?

[Ruth Cadbury]

My hon. Friend is right. Children growing up in poverty do not have the same advantages and opportunities as many in their peer group. We cannot have a situation in which the adults of the future are not able to develop as they should in an equal, fair society.

Among examples discovered by the TUC of how brazen companies can be when they employ women was an advertisement in Wales for two seasonal roles—Santa Claus and Mrs Claus. Santa was to be paid a fair wage of £12 per hour, while Mrs Claus was paid the national minimum wage of £6.70 per hour. There was no difference in their job descriptions, and they both did the same amount of work, but the woman’s role was deemed to be of less value. That may seem like an interesting one-off, but it perfectly demonstrates how differently men’s and women’s work is valued 45 years after the implementation of the Equal Pay Act 1970.

Occupational segregation and the devaluing of work traditionally carried out by women, such as caring, directly contributes to the gender pay gap. That must be tackled and the Government must do more to diversify the labour market. As I have said, UK women earn on average 91% of what men earn. To put it another way, as of 9 November, just over a week ago, women are effectively working for free for the rest of the year. That is simply not acceptable in the 21st century. Progress has not been quick enough. Under Labour the gender pay gap reduced by a third—a trend that has, I admit, since continued; but while the gap has narrowed for full-time workers, it has widened for part-time workers and we must not be complacent.

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[Colleen Fletcher]

I agree with my hon. Friend on that point, which was also raised by our hon. Friend the Member for Brentford and Isleworth.

As I was saying, although the types of job I describe are crucial and help to hold the fabric of society together, they are all too often part-time, low-skilled jobs with few progression opportunities, and are viewed and derogatively dismissed as “women’s work”. Consequently, they are undervalued and underpaid relative to comparable jobs in male-dominated sectors. As a result, low, unequal pay for work of equal value is the bleak reality for many of Coventry’s working women in this divided and divisive labour market.

[Margaret Greenwood]

Does my hon. Friend agree that the fact that women in their 50s earn 18% less than men not only is an injustice for those women, but really reflects a failure of our society to harness all the expertise and knowledge of those women? That shortcoming as a society has an impact on our economy.

[Colleen Fletcher]

I absolutely agree with my hon Friend. I have had experience of that, and constituents have written to me about those very things.

One of the clearest examples of this inequity is the widening gender pay gap in the city, which last year increased to 16.2%, up from 15% the previous year. It reached an astonishing 20.6% in my constituency. That means that on average, women in my local area took home just 79p for every £1 earned by a man. That rising inequality and resultant deterioration in the financial position of women across Coventry is extremely worrying and wholly unacceptable in equal measure, but of course the most fundamental and obvious problem facing women in these less valued and less well paid jobs is their inability to earn enough to provide themselves and their family with a decent standard of living, and in some circumstances even to keep their heads above water.

We know that low income as a result of reliance on low-paid work and in-work benefits limits access to adequate housing, education and other services or facilities, as well as to essentials such as food, fuel and clothing. That socio-economic disadvantage is inextricably linked to the significant health and social inequalities seen in Coventry and in my constituency, which impact upon some of the poorest and most vulnerable of my constituents. That is why we simply cannot continue to allow less valued and less well paid work to be the fate of generation after generation of women. We need fundamentally to tackle the undervaluation of so-called “women’s work”, while simultaneously challenging gender stereotyping within the labour market, expanding opportunities for quality flexible and part-time working, increasing affordable childcare provision, and raising pay across the board, particularly within traditionally feminised work sectors.

Coventry City Council has taken a lead on the issue locally by becoming a living wage employer—like my hon. Friend the Member for Brentford and Isleworth, I was directly involved in that as a councillor some time ago. Such a move ensures improved income levels for a substantial number of low-paid individuals, the majority of whom are women. In addition, the council has also implemented a social value policy, which includes payment of a living wage as one of the criteria that the council will consider in its procurement process. That will benefit all workers on low pay, but particularly women, as they make up the majority of those on low pay in my city.

[Neil Gray (Airdrie and Shotts) (SNP)]

It is a pleasure to serve under your chairmanship, Mr Howarth. I congratulate the hon. Member for Brentford and Isleworth (Ruth Cadbury) on securing this important Westminster Hall debate. I welcome her noteworthy and impressive contribution, as well as the contributions from other Members who have spoken.

The hon. Lady said that there has been a focus on high-paid jobs. It is important that women are given equal representation in high-paid jobs—and in boardrooms, political parties and Government Cabinets—so I can understand why she makes the point, but I think it is important that we focus on both high-paid and low-paid jobs. She highlighted the fact that three out of five jobs in minimum wage work are held by women. I have to admit that I was not aware of that startling figure, but I am glad that she raised it. That is why sorting equal pay claims from councils across the country is so important.

The hon. Lady highlighted the issue of the damaging branding of the Chancellor’s minimum wage premium as a national living wage. It is not national—it is only available to over-25s—and it is not a living wage; it falls way short of the Living Wage Foundation’s independently set living wage, which is calculated based on the cost of living. She mentioned that having a gender pay gap is bad for business. The statistic that she used to highlight that is absolutely correct and it is worth sharing it again: if we were to equalise the gender pay gap, we would boost productivity by an estimated £600 billion in this country. Frankly, that is astonishing. I thank her again for securing the debate.

The hon. Member for Worsley and Eccles South (Barbara Keeley) raised a number of very important points about problems with pensions, particularly for women born in the 1950s. Those issues were discussed just yesterday in a Westminster Hall debate secured by my hon. Friend the Member for Ross, Skye and Lochaber (Ian Blackford). The hon. Member for Coventry South (Mr Cunningham) made very important points during that debate, as well as during this one. The hon. Lady, on behalf of the WASPI campaign group, made some very important points, which I welcome and which are supported by SNP Members.

My hon. Friend the Member for Lanark and Hamilton East (Angela Crawley) made a typically powerful speech. She made the point that gender equality is not a dream and should not be a dream. It needs to be a reality. She also said that women get paid two months short compared with their male counterparts.

[Margaret Greenwood]

Some years ago, I was fortunate enough to have a job teaching on a “women back to work” programme. The vast majority of the women were divorced. It was a really fantastic experience for me to see how quickly they improved their skills and educational base in a very short space of time. Does the hon. Gentleman agree that it is very important to provide training and educational opportunities for women—not just women in employment, but those who are unemployed, so that they can get back to work and generate the kind of economic activity that will boost their life chances?

[Neil Gray]

Absolutely. There is nothing that I can disagree with in that intervention, and I will come to some of those issues later in my speech.

Returning to the contribution from my hon. Friend the Member for Lanark and Hamilton East, the gender pay gap still exists even in what would be traditionally or stereotypically described as “female jobs”. That is still wrong and needs to be addressed. No man wants to see his daughter suffering a gender pay gap—that is absolutely right. I speak as a the father of a one-year-old daughter who I hope will go on to employment where she will earn the same as her male counterparts, so I stand here today on that basis.

The hon. Member for Coventry North East (Colleen Fletcher) effectively highlighted the issues of gender inequality in her city of Coventry. Again, I highlight the contribution made by the hon. Member for Coventry South, who, as I said, also made noteworthy contributions to the debate on pensions yesterday.

It is disappointing that in 2015 we are still discussing matters of gender equality. Nevertheless, it is important to take cognisance of the fact that a real pay gap between men and women remains. Low pay affects women disproportionately. In 1999, the gender pay gap for full-time employees in Scotland stood at 16.7%, but by 2014 it had been reduced to 9%, and it is 9.4% in the rest of the UK. This year, the Scottish Government launched the Partnership for Change programme, wherein public, private and third-sector organisations make a voluntary commitment to work toward a 50:50 gender balance on their boards by 2020. As of 9 November, 160 organisations and businesses have signed up, which I am delighted to see, although more work is clearly needed. On this year’s equal pay day, 9 November, First Minister Nicola Sturgeon pledged to do everything she can to advance equal pay and gender equality in Scotland as part of the Fawcett Society’s pay gap pledge campaign. The First Minister has been leading the way on the issues, starting clearly and publicly with her 50:50 gender balanced Cabinet.

Many women shoulder a disproportionate amount of childcare or family responsibilities, and they are unable to take up promotion and other opportunities because they do not have alternative care arrangements. The Children and Young People (Scotland) Act 2014 provides further assistance to women and young families by providing that all three and four-year-olds and the most disadvantaged two year-olds are entitled to 600 hours of early learning and childcare. By the end of the next Parliament, the Scottish Government will have doubled the hours from 16 to 30 per week. Increasing childcare will not only improve outcomes for children, but support more women into work.

The Scottish Government have also provided Skills Development Scotland with additional funding as part of a wider £3 million allocation in 2014-15 to develop a range of equality activities, including tackling gender segregation. The Scottish Government are doing all they can with the tools on offer to provide tangible improvements.

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[Nick Boles]

I do not want to get into a discussion about what another Minister said in a debate that I was not part of, but the quote that the hon. Lady read out indicated that the Secretary of State would consider transitional arrangements. It did not sound to me like a clear pledge to bring in any particular transitional arrangement. I have described the position and the fact that there will be a further review in 2017, which will allow those issues to be revisited.

[Margaret Greenwood]

What analysis has the Minister made of the impact of the cuts to local authorities that the Government are considering on low-paid women working in councils up and down the country?

[Nick Boles]

As the hon. Lady is aware, all decisions, legislation and regulations are subject to equality impact assessments, in which all those things are considered. Her intervention leads me neatly to my conclusion. For all that the steps that I described—transparency, leadership, childcare provision and increasing the national minimum wage through the introduction of the national living wage—are powerful, the most important source of opportunity to improve the pay of women and close the pay gap is a strong economy that creates lots of new jobs. Those new jobs and employment opportunities give women the opportunity to go out and command better wages.

Although I understand that the hon. Lady opposes public spending cuts, it is nevertheless the case that as a result of the consistent policy of slow but steady deficit reduction, this economy has created more jobs than any other country in Europe, and more women are in work than ever before. It might have been possible for Opposition Members, while properly opposing the Government on specifics, to give some acknowledgement of the fundamental achievement of creating jobs, which create opportunities, including the opportunity for women to improve the wages that they earn.