Draft Equality Act 2010 (Gender Pay Gap Information) Regulations 2017

Melanie Onn Excerpts

Wednesday 25th January 2017 General Committees

[Vernon Coaker]

It is a pleasure to serve under your chairmanship, Sir David. It is a few years since I have been on one of these Committees, but I was keen to serve on it because it is important for me as a man to say how important the regulations are. Although they are about the gender pay gap, the issue concerns us all.

The situation is simply not good enough. Men should be demanding equal treatment for women and the closure of the pay gap as loudly as many of my colleagues have done, particularly my right hon. and learned Friend the Member for Camberwell and Peckham, who has campaigned on these issues for decades, including when the attitudes she was facing were even more difficult than they are today. We should recognise women who have done that throughout the ages, wherever they have come from. We would not have reached this point were it not for many women like my right hon. and learned Friend. She is here today, and she remains an influence.

It is important for us to lay out the fact that the pay gap, despite numerous attempts and numerous pieces of legislation, remains at 18.1%. For full-time equivalent roles, it is 9.4%. In my region, the east midlands, it is 12%, and that simply is not good enough. More urgency has to be injected into this issue to try to move things forward. Otherwise, there will be a Committee like this one in 10 years’ time berating the fact that whoever is in government at that time is presiding over a gender gap that is 8.9% instead of 9.4%. We have to do better, and the challenge is not just for Government but for all of us to demand better.

My hon. Friend the Member for Rotherham asked an important question, and I reiterate it to the Minister. These pay gap regulations will affect larger private companies, but what exactly do the Government intend to do? What will the timescale be for reporting by Government Departments and larger public bodies? Given the number of people they employ, it would be interesting to hear about that.

[Melanie Onn (Great Grimsby) (Lab)]

I wonder whether any consideration has been given to different-sized employers. Women who work for a larger employer might have their pay gap monitored, but if they work for a smaller employer doing exactly the same job, they will not be monitored. Those will be people doing exactly the same job and still experiencing significant levels of inequality. Does my hon. Friend see that as an issue?

[Vernon Coaker]

That is a real issue. The Minister will be able to confirm this, but I think I am right in saying that the regulations will affect 34% of women. That will obviously leave a significant number of women outside the scope of the regulations, who might include some of the women my hon. Friend refers to.

People moving in and out of companies, going from one employing more than 250 to another that does not, is a real issue. I will come back in a couple of minutes—I do not want to speak for too long—to the review mechanism that the Government have built into the regulations. They should consider that point.

I want to draw the Committee’s attention to the fact that some of the issues we are discussing might be cultural problems. It is difficult to argue that we should change the culture by changing the law, but the law can be a signpost to the sort of cultural attitudes we wish to encourage. I am not saying that we should pass a law on this, but CHILDWISE published a report today about discrimination in pocket money. I confess an interest— I will need to check with my family, who are grown up now, to ensure that this did not happen for them. Apparently the gender pay gap begins early in childhood and at home, with boys receiving 20% more pocket money than girls. I hope I did not do that, but I cannot say I definitely did not. It would completely undermine what I am saying now.

The new report from CHILDWISE reveals that between the ages of 11 and 16 the gap grows to 30%, which mirrors what happens in the adult population, where the gender pay gap rises as women get older. Between those ages boys receive an average weekly income of £17.80, and girls of the same age lag behind on £12.50. I do not know how accurate those figures are; I am just quoting them. I do not think I gave my son £17.80—maybe a month, but not a week.

The serious point I am trying to make is that the cultural attitudes in our society are what we need to address, think about and challenge, but the law is a good place to start. I take my hon. Friend the Member for Rotherham’s point that these regulations come seven years after the primary legislation, but the Government did try a voluntary approach. The explanatory memorandum shows the failure—not a catastrophic failure, but a very real one—of the voluntary approach. We are told on page 2 of the explanatory memorandum that according to the ONS:

“Whilst over 300 organisations signed up to this initiative, we are aware of only around 11 of those that have voluntarily published gender pay information.”

That initiative was set up in 2011, so the necessity of the regulations cannot be overestimated.

--- Later in debate ---

[Seema Malhotra]

It is a pleasure, Sir David, to participate today and to serve under your chairmanship.

I will say a few words following the excellent speech that my hon. Friend the Member for Gedling has just made. If he was looking for a part-time advisory role to the President of the United States of America, I would certainly be willing to support him in that endeavour.

First, I thank the Government again for introducing the regulations. However, building on the points that have already been made, I encourage the Government and the Minister, who laid out her case for the need for the regulations powerfully, to think about the wider issue of economic equality for women, particularly in the run-up to the March spring-statement-stroke-Budget. Keeping the issue going and mainstreaming its implications is an important part of how we can move forward in achieving equality for women across all areas of the economy, which is essentially the backdrop to this debate.

I was struck by some of the analysis of the gender pay gap, and I want to put a couple of suggestions to the Minister. My concerns are around the implementation of the regulations. On one level—the transactional level—that is about how they are implemented within a corporation and how the data are collected and reported on. That can stay within a very small sphere of people: maybe the head of human resources and the chief executive officer. Culture change and the players involved in it are an important part of what a company or organisation owns at the highest level.

I know from my past work on equality in companies, on public boards and in politics and public life that it is important to have wider stakeholder engagement to ensure that people understand the responsibility we can all have in making a shift. That helps to create a context and environment within which there can be actors who will act on the messages that come out from the reports and from transparency more widely. They will have a sense of their own responsibility in making that shift.

I am keen to understand how the regulations will be implemented and whether messages and communications will go to chairmen and women on boards, heads of HR, management networks or other networks. We must look at how to mainstream thinking about jobs and pay much more widely, so that we can pre-empt and reduce the problem and see the results coming through.

[Melanie Onn]

On implementation, I am interested to see that in the devolved Administrations in Wales and Scotland, the measures will be implemented under the regulations. I wonder how the Government will monitor that implementation at devolved level, to ensure that these measures are being implemented fairly across the whole United Kingdom.

[Seema Malhotra]

My hon. Friend makes an important point. The public expectation will be that the regulations go beyond administrative boundaries and that the Government take a lead to ensure that they are effectively implemented. It would be helpful if the Minister responded to that point.

It might seem like it is just a small Committee putting the regulations forward today, but I worked in the Government Equalities Office on a different project at the time when the Equality Bill was going through Parliament, and I pay tribute to the civil servants for their work and engagement and to my right hon. and learned Friend the Member for Camberwell and Peckham for leading that work. It was near the close of the Labour Government’s time in office—it was pretty much the last Act that went through Parliament.

To return to the point about the meaning of these measures and those for whom they could make a difference, I was struck by the analysis of the gender pay gap by age published by the House of Commons Library. The gap is much greater for older women, who are hit in other ways as well. They might lose their job and find it harder to get another. We know that they are often the poorest pensioners and the least likely to have pensions in their own right to sustain them in older life. That compounds the problem of the economic wellbeing of older women and poverty that can become entrenched. Awareness of that within organisations would be an important part of tackling economic inequality for older women, particularly when we look at differences by decade of birth.

There is another important issue, which is the relationship, or otherwise, between educational attainment and the pay gap. When we look at the analysis, it is striking that although there is sometimes a link between a better-educated workforce and a reduced pay gap, that is not always the case. There is still a strong gender dimension. We can try to distil the pay gap down to contributing factors such as people leaving school earlier or not having certain educational qualifications, but the data do not suggest that those are the key issues. Rather, the gender dimension remains the key point. That suggests there is a wider cultural inequality issue, which it is important to address. Whether women have GCSEs, A-levels or degree-level education, the analysis shows there is still a gender pay gap for them.

That leads me to my final point, about how we can work much earlier in schools to create role models and a sense of confidence and aspiration. The Fabian Women’s Network, of which I am the founder and president, undertakes deep thinking about that issue. We need to ask what tone we are setting as a nation for the girls, and we need to give them confidence that any future they may want is a future they should be able to achieve; that any profession they want to be in has a door open to them; and that any sky they want to reach is available to them.

The regulations are vital for women who are currently in the workplace, and they can also help us achieve a culture change if we implement them effectively, think about the factors that will support better understanding of the pay gap in organisations and make sure that the issue is cascaded down through management levels in organisations.

I hope the Government will not just encourage organisations to keep data at senior management level but encourage directorates or departments to understand what the gap is in their own departments. That will help to create wider appreciation of these issues lower down the management chain. As those managers then become the senior leaders of tomorrow, they will have begun to appreciate and been engaged with these issues as they become embedded within management life.

I hope that as the regulations are implemented, we will look at the immediate implications and at how we can shift our culture through the opportunity that the regulations will enable. Achieving that shift now will not just help the generations of women in the workforce today but set a completely different tone for our country and benefit the young women coming forward through the schools and in the workplace of tomorrow.