Energy Policy
Owen Smith Excerpts(5 years, 10 months ago)
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Greg Clark
With any proposal, it is important to do due diligence and check the basis of the calculations, and in this case, in so doing, as my hon. Friend stated, we found the gap to be so wide that the proposal could not be responsibly backed. As I have said to hon. Members, however, any proposal that is competitive will be welcomed.
Owen Smith (Pontypridd) (Lab)
This is another blatantly broken promise to the people of Wales, but I will leave that aside. The Secretary of State has given umpteen speeches talking about the need for this country to invest in new technologies and innovation and lamenting that we have failed to capitalise on great British ideas in the past. Does he not see the huge gap now between that laudable rhetoric and his short-term accountancy decision today?
Greg Clark
Part of the assessment, and part of that which Charles Hendry made in this analysis, was of the technology’s export potential, and a great proportion of the global potential is within this country, so it does not have the potential the hon. Gentleman describes. In fact, Charles Hendry concluded that any benefits from the technology would be limited to design and consultancy, rather than substantial industrial benefits.
DRAFT National Minimum Wage (Amendment) REGULATIONS 2017
Owen Smith Excerpts(7 years, 2 months ago)
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Owen Smith (Pontypridd) (Lab)
It is a great pleasure to serve under your chairmanship today, Sir Alan.
One might have thought that I would have learned in the summer that it is a big mistake to try to get one up on one’s elders and betters on the Front Bench, but I absolutely cannot resist. I will go back not to the 1980s and 1990s, but to 1910, when my great-great grandfather, Dafydd Humphrey Owen, was a Cambrian Combine stay-down striker in south Wales, striking for a living wage as part of the Labour movement. Members will no doubt remember from their history that the colliers were crushed by a future Conservative Prime Minister, who was then a Liberal. The Tory party at the time wholly opposed the introduction of a living wage of any sort.
Scrolling forward a few years to April 1999, when the last great Labour Government introduced the living wage, the Tory position had not changed one iota. They were still opposed to it and argued that 2 million jobs would be lost in this country. I remember that extremely well. Of course, we did not lose 2 million jobs. We did not lose a single job as a result of the introduction of the minimum wage, but we did increase the pay of more than a million low-paid people in this country by 15% overnight, lifting 1 million people in this country out of poverty at a stroke.
Playing forward to where we are today, the Tory party has ostensibly recanted, as my hon. Friend the Member for Birmingham, Erdington said, and supports measures to increase the pay of the lowest paid in this country. As last week’s Budget yet again illustrates, the reality, if we look through the rhetoric and beyond the soundbites, is a Tory party that still seeks to balance the economy on the backs of the poorest.
Not only is this not a real national living wage—I will not even indulge in the argument about the nature of the wage, as we all know that it is a minimum wage—but the Tories are not even honouring the commitment they made just a few months ago for it to rise to £9 over this period. It will rise only to £8.75, well short of the £10 that the Labour Opposition say we should be aiming for. Add that to the fact that low-paid workers in this country have already seen dramatic cuts to their income in the past few years, the latest being the increase in national insurance contributions for self-employed workers introduced just a few days ago. When we add that to the cuts to the work allowance and universal credit, low-paid workers in this country—people earning £15,000 or £16,000 a year, working 36 hours on the minimum wage—will be between £2,000 and £3,000 worse off as a result of the budgetary changes made by this Tory Government. That one fact blasts out of the water all the nonsense we have heard about the Tories being in favour of a proper national living wage in this country. The plain fact is that they are not providing living wages for people.
The Budget last week once more showed working people being asked to pay the price. The reason the Government are having to do that even more now, of course, is Brexit. What we saw in that Budget last week, beyond all the complacency and the quips and smirks from the Chancellor, was a devastating report on the state of our economy by the Office for Budget Responsibility.
In the past 11 months, the OBR has uprated the amount of borrowing it says this country will need over the spending period by £100 billion. If a business or some sort of public body had its forecast wrong to the tune of 100 billion quid, it would be in serious trouble. Just 12 months ago, the Government projected that we would see rising growth rates throughout the spending period, and then the OBR came back and downgraded growth in every single year out of the next five. If a business did that, its investors would start to look askance at the business plan.
Having seen that massive increase in borrowing and the projections for lesser growth over the next five years, did the Conservative party choose to prioritise the incomes of working people? Did the Government say, “What we really need to do is make sure that people at the bottom end of the income scale are the people who are protected from the downturn in our economy that the OBR is predicting”? No, they did not. They carried on with cuts to corporation tax. They pushed through the cut to inheritance tax. They did not reverse the cuts they had made to the top rate of tax.
They did not do anything that would ask those people with the broadest shoulders in our economy and society to bear the largest burden. Instead, they chose to take more money from the working people of this country by slowing the rate of growth in the national so-called living wage, meaning 1,400 quid less by the end of the period for average working families. They chose to push through the NICs changes, which will mean reductions of between 30 and 250 quid on top of the thousands of pounds in reductions in income that universal credit cuts have brought about.
The Opposition will take no lectures from the Tories about their intention to support working people in this country, because they have illustrated over a century and more that they do not.
Stella Creasy
Exactly. It is completely inconceivable that age rather than proficiency should define someone’s employability.
There is an issue for us here about whether the statutory instrument will help Britain. We have to acknowledge a word that seems to be missing from the Government’s vocabulary but will in fact define these issues: Brexit. Our economic position is so uncertain. The chances are that inflation will continue to rise; that is clear to the Opposition. The question of what difference £2 makes will be all the more important in the years ahead that the legislation provides for.
In 4 million households in this country people are in work but in poverty. The point behind the living wage campaign, which I am so proud to have been a small part of in my part of town in east London, where all the best things come from—I will fight you all for that—is that it is not simply about living to work or working to live, but living a life worth living. That is why having a living wage makes a difference. This is about the cost of living. Just as inflation has risen and wages have not—for the first time wages have not kept up with growth in our country—so the costs of living are extraordinary.
I have the dubious distinction of representing the part of the country with the most estate agents per square mile. My part of town has had the highest rise in house prices of any part of the country. The Minister looks shocked, but Kirstie and Phil are the harbingers of doom for many people in my community because the cost of living, which their wages have to cover, is going up and up. That is why having a real living wage matters. Not having one means that we as a society have to deal with the consequences in a number of ways. We have to try to help people cover the cost of living, keep a roof over their head, feed their kids, put money in their electricity meter and take their kids to school. We also have to deal with the consequences of debt that we are now seeing in our country.
I look at these proposals in the context of the impact: 24% of people in this country now have mental health issues because of their personal finances and 41% of families are worried about their debt and whether their wages are going to cover such costs. One in six of those people is worried because they have borrowed money from a family friend or member. There are real human consequences to not having a real, genuine living wage: families are torn apart.
Owen Smith
I am sure my hon. Friend was about to come on to this. She is making a powerful speech and a powerful point about private debt in this country, but was she as gobsmacked as me during the Budget to see that public debt is now scheduled to go up to £1.9 trillion by the end of the spending period? That is a 150% increase in our public debt since the Tories came to power. Does she think for a moment that they can ever again use the line about not saddling our children with debt when they have saddled this country with such debt?
Stella Creasy
I was very taken with the point that my hon. Friend made about these regulations in his speech. If the financial director of a company came to their board seven years in a row having got their sums wrong, we would expect somebody to get the sack. The Chancellor and the Prime Minister certainly bear some responsibility for this.
We know that the Government expect private debt to pay the cost of that public debt, so the people who are on low wages and are going to get into more debt because we are not paying them the living wage are the very people who are going to pick up the tab for the debt that my hon. Friend describes. I want to understand why the Minister thinks we should celebrate at this point in time when we see that personal debt is rising.
People are struggling. The 36% of people in my community who are paid less than the living wage need that extra £2. We need them to earn that extra £2 so we do not have to pick up the cost, not just because we are going to face a very expensive bill for Brexit and because of the way in which the Government are managing the public finances but because of the human cost and the effect on talent and creativity. We know that families with children living in poverty struggle harder to achieve. We know that the next generation needs a better shot than the current generation if it is to contribute to the global land of milk and honey that Brexit will deliver for us. We know, therefore, that it is not enough to claim that this is a living wage. Call it a minimum wage. It is wonderful that there has been a damascene conversion to the idea that this is of economic and social benefit, but do not call it a living wage when so many people are not able to live on it.
Margot James
The hon. Gentleman makes the point very well indeed. That is why we are trying as a Government to build a more inclusive society, in order to ensure that, as he says, people who are talent-rich but asset-poor get a fairer start in life. That is also why we are investing hugely in skills and infrastructure to try to bring better-paid jobs to all. It is not just about the minimum wage; it is also about the architecture of the economy surrounding people for whom there are few opportunities at the moment or opportunities just for low-paid work.
To correct the impression given by the hon. Member for Airdrie and Shotts in his remarks, real wages have grown every month for more than two years now. The average rate of growth across the economy of real wages was 2.6% over the last 12 months.
Owen Smith
I am very grateful. The impression that the Minister is giving and the Government have given repeatedly is that wages have really bounced back. The truth is that there has been a welcome bounce back in wages for the last 18 months or so, as she points out but, as the OBR said last week—five days ago—average wages will not reach their pre-2007 height until 2022. We are living through a decade-long recession in wages.
Margot James
As I said, real wages have risen every single month for the last 22 months.
Margot James
That is a fact—I am sorry if it displeases the hon. Gentleman. I accept what he says about the future projections—I am not going to start arguing with the OBR—but I am afraid that if he has his way and brings in a national minimum wage of £10 an hour overnight, that will result in more unemployment, which would set people’s chances back.
Equality and Human Rights Commission
Owen Smith Excerpts(7 years, 2 months ago)
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Chris Stephens
The hon. Gentleman is correct that concessions were given to the Opposition, but I think the Government are backtracking on them, as we saw in a Delegated Legislation Committee, with trade unions now being forced to have additional conferences to meet requirements in the new legislation.
Owen Smith (Pontypridd) (Lab)
I, too, congratulate the hon. Gentleman on securing the debate. Will he confirm that another thing on which the Government are backtracking is the funding for this organisation? During a year in which hate crime has doubled in this country, we have seen the funding and staffing of the commission cut by 25%. Does he agree that it is extraordinary that the body that is supposed to be the watchdog on behalf of the Government in respect of disabled people’s rights—it is one of this country’s most important watchdogs—is sacking disabled workers at a day’s notice?
Chris Stephens
I agree wholeheartedly, and I shall come back to these points in detail later. If the hon. Gentleman would like to intervene again then, I would be more than happy to give way.
I invite Members to look closely at who was chosen for compulsory redundancy and who was then sacked by email, as highlighted in early-day motion 944. Of the 10 sacked members, seven are black or minority ethnic, four are Muslim and six are disabled. I hope that no one will challenge the arithmetic on that, as it is possible to have overlapping identities.
As I understand the situation, one of the dismissed staff members was an Army veteran whose motorised wheelchair was taken away the day after he received his redundancy notice. Three of the sacked members held elected roles on their union’s branch executive committee and one was a trade union negotiator who was leading talks to protect employees from compulsory redundancy.
This issue raises concerns about blacklisting and trade union victimisation throughout the ongoing restructuring process. It is also not difficult to conclude that certain types of employees have been targeted and potentially discriminated against. Not only is that utterly wrong in and of itself, but astonishing that it should come from the Equality and Human Rights Commission.
Chris Stephens
There seems to be a choice. I give way to my fellow member of the European Scrutiny Committee.
Chris Stephens
That is an excellent point. When the commission is seen to be conducting itself in this way, it sends out a very dangerous message to rogue employers.
Owen Smith
Will the hon. Gentleman also comment on the impact of these sackings on the Government’s stated aim of halving the disability employment gap in this country, given that five of the sacked people are disabled?
Chris Stephens
It shows that the Government say one thing in public and do another thing in private. That is the only message that we can take from this.
This is in the realms of “you really couldn’t make it up.” The Government cannot absolve themselves of any responsibility for this surreal situation. Increasingly, ministerial responses on this issue are becoming a little tetchy, and along the lines of, “This isn’t really anything to do with us.” As I have said before, something that is Government sponsored and Government funded is publicly accountable. That is what we are doing today—giving parliamentary scrutiny to an organisation that is not acting in the spirit of its own ethos and stated aims.
The strike was called because people were at risk of compulsory redundancy, even though more than 30 commission vacancies remain unfilled. A restructuring process has been driven by severe budget pressures: a 25% cut over the next four years comes on top of a 70% cut in real terms since 2010. That was confirmed by House of Commons Library research, which was commissioned by the hon. Member for Brent Central (Dawn Butler). The Equality and Human Rights Commission has been described as facing collapse.
The Minister for Universities, Science, Research and Innovation (Joseph Johnson)
I begin with an apology on behalf of the Under-Secretary of State for Women and Equalities, my hon. Friend the Member for Gosport (Caroline Dinenage), who is unable to respond to this debate due to other business. However, I am here and happy to respond on her behalf. I thank the hon. Member for Glasgow South West (Chris Stephens) for securing this important debate. It is timely as it allows me the opportunity to confirm the budget agreed with the EHRC for the remainder of this spending review period, something which has been of interest to many hon. Members.
Before I move on to provide greater detail, I want to take a moment to remind ourselves of the wider context of Government fiscal controls. At the beginning of the last Parliament, as hon. Members will remember, the Government inherited the largest deficit in the post-war period. The EHRC’s position needs to be seen against that background and against the significant spending reductions that apply to central Government, including making over £20 billion of savings by 2019-20. I can confirm that the EHRC’s settlement for this spending review period amounts to a total budget of £20.4 million for 2016-17, £19.3 million for 2017-18, £18.3 million for 2018-19, and £17.4 million for 2019-20, equating to a 25% reduction across the spending review period since 2015-16. Obviously, and as the hon. Member for Glasgow South West made clear, reductions in the EHRC’s budget stretch across a longer timescale than just this spending review. With its settlement now confirmed, the EHRC will have had an approximate budget reduction of 68% between 2010-11 and 2019-20.
Joseph Johnson
If hon. Members give me some time, I will supply some context for the reduction, most of which we did not hear from the hon. Gentleman.
Owen Smith
I am grateful to the Minister for giving way. In the context of a current budget deficit of around £68 billion, is he seriously telling the House that cutting the EHRC’s budget by 68% down to £17 million is really necessary or relevant?
Joseph Johnson
The context that I am about to provide will help hon. Members understand in more detail why cuts of that magnitude were appropriate. If the hon. Member for Glasgow South West bears with me, I am sure that I will answer the question that he was about to ask.
First, when the EHRC was set up in 2007, it had an extraordinarily high budget to facilitate the merger of three previous bodies—the Equal Opportunities Commission, the Commission for Racial Equality, and the Disability Rights Commission—into a new body. The budget was simply not right for the organisation during its infancy. In 2007, the EHRC had a budget of £70 million, which was an astonishing £20 million more than the combined budgets of the three previous commissions. The EHRC never managed to spend more than £62 million in any year. Indeed it often struggled to spend its allocation, reporting significant and repeated underspends. In June 2010 for instance, the EHRC budget was reduced in-year from £62 million to £55 million. However, the EHRC’s actual expenditure in 2010-11 was £48 million, of which £16.3 million, or 35% of its budget, was spent on its corporate costs.
Secondly, those with longer memories will acknowledge that the organisation was poorly managed at the time and had poor spending controls, as a result of which its first three sets of accounts were all qualified. That inevitably called into question its financial controls and the amount of funding that it should be given.
Thirdly, Members should be aware that the EHRC’s budget reductions have simply reflected changes to its range of functions. A number of significant functions have been repealed, or are no longer funded, to help it concentrate on its core remit. Most notably, the EHRC has stopped its large grants programmes, which had been mismanaged and cost several million pounds. The EHRC also lost its helpline, which cost £2.5 million a year, and its conciliation role in service provision. Those functions ceased in 2012-13 and were costed at £10.1 million or 21% of the EHRC’s budget at the time.
Those changes were considered in the review of public bodies conducted by the Government in 2010, and it was decided that the EHRC should be “retained but substantially reformed”. In March 2011, the coalition Government accordingly set out plans to reform the EHRC in the consultation document “Building a Fairer Britain: Reform of the Equality and Human Rights Commission.”
The current Prime Minister, who at the time was Minister for Women and Equalities along with her Liberal Democrat coalition partner Lynne Featherstone, set out proposals
“to transform the Equality and Human Rights Commission into a valued and respected national institution.”
A comprehensive budget review was set up in 2012 to identify the minimum level of funding needed for the commission to discharge its statutory functions effectively, in accordance with the provisions of the Equality Act 2006. The review concluded that steady state funding of £17.1 million would be adequate for the commission to continue to fulfil its statutory functions.
Joseph Johnson
I will take another intervention on the same point and then I will deal with one from the hon. Member for Pontypridd.
Joseph Johnson
Turning to the points about restructuring, hon. Members will know that the EHRC has followed a multi-staged process, to mitigate the impact of job losses on all staff, including consideration of those with protected characteristics. The commission is confident that the processes undertaken to date have been fair, evidence-based and transparent. Trade unions have been extensively consulted to offer every alternative to compulsory redundancy, where possible. Despite that, they have called five strikes in recent months.
Happily, the EHRC is no longer the focus for the tabloids’ wrath. Its accounts have not been qualified for five years. It has provided respected policy interventions on stop and search; the treatment of religion in the workplace; and pregnancy and maternity discrimination. It has intervened successfully to help enforce the Equality Act and human rights at the European Court of Human Rights.
Joseph Johnson
I will give way, but this has to be quick as we are running out of time.
Owen Smith
I am grateful to the Minister, who is being very generous in taking interventions and is trying to answer our questions. However, in so doing he is making our case for us, because he has just admitted that six of the people who are being sacked are disabled, which will clearly add to the disability employment gap. In conceding that we are seeing a rising tide of hate crime, despite the fact that we have this commission, he is surely making the point that the £17 million it currently has to support its work is inadequate.
Joseph Johnson
The hon. Gentleman needs to look at the EHRC’s restructuring in the context of its ability to carry out its broader work to support people with disabilities and to ensure that their rights are not affected by their disabilities in terms of their ability to access opportunities in the workplace.
As the National Audit Office notes, the EHRC
“has responded to its budget reductions in a number of ways”,
and it is increasingly working in partnership with other organisations and being more selective in the legal cases it takes on, taking on cases with the potential for the most impact and thereby enhancing its overall effectiveness. We are working with the EHRC to increase its effectiveness further. We share the view that members of the Women and Equalities Committee expressed in January: the EHRC should play to its unique strengths and powers, as provided in its legislative framework, by making more selective legal interventions and leaving the research to other bodies that can already fulfil that function.