Oral Answers to Questions
Philip Davies Excerpts(4 years, 6 months ago)
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Nadhim Zahawi
The hon. Lady mentions the CBI. Both the Mayor of Greater Manchester, Andy Burnham, and the Mayor of Birmingham, Andy Street, who sits on the panel conducting the review, have said it is important that we kick the tyres on value for money, but it is also important to make such representations to ensure that the committee gets a full view of the business benefits of HS2.
Philip Davies (Shipley) (Con)
May I urge the Minister to ignore the siren voice opposite? Most people in the north accept that HS2 is a catastrophic waste of money— a huge white elephant that is destroying the environment and the countryside and will chiefly benefit London, hence why it started out in London in the first place. May I therefore urge him to tell the Secretary of State for Transport to scrap HS2 and crack on with the thing that will really benefit the northern economy—Northern Powerhouse Rail or HS3—connecting the north, which is what we need to benefit the north’s economy.
Mr Speaker
I do wish the hon. Gentleman would overcome his natural shyness.
Oral Answers to Questions
Philip Davies Excerpts(5 years, 5 months ago)
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Richard Harrington
As ever, my hon. Friend is fully in support of so many businesses in his constituency. As he knows, my door is open to him and the company, to discuss any possibilities of helping them. I have seen many very good businesses in his constituency and I am excited about the prospects there for high-quality employment for his constituents.
Philip Davies (Shipley) (Con)
The question is really whether we leave the EU at all. Yesterday, on the “Today” programme, the Secretary of State was arguing in favour of a proposal by the EU to extend the implementation period to the end of 2022. Was the Secretary of State doing his usual EU freelancing, or is that now the official policy of the UK Government?
Richard Harrington
The Government want to finalise the future trading relationship with the EU as quickly as possible. My right hon. Friend the Secretary of State mentioned one alternative to achieve that.
Oral Answers to Questions
Philip Davies Excerpts(7 years, 4 months ago)
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Jesse Norman
That question is really as much for the Department for Environment, Food and Rural Affairs as it is for us. Nevertheless, it is true that tastes are expanding around the world, and therefore one sees every opportunity for British food producers to expand their world markets in the days to come.
Philip Davies (Shipley) (Con)
Given that we have a massive trade deficit with the European Union, surely it would be economic suicide for the EU not to agree a free trade deal with us. However, Civitas has calculated that if it did go down that line, British business would have to pay about £5 billion a year in tariffs under WTO rules to access the EU market, and EU businesses would have to pay about £13 billion in tariffs to access the UK market. Given that, could we not agree to cover all tariffs for British businesses exporting to the EU, so that they do not have to pay anything, and still be quids in?
Jesse Norman
Alas, long experience has taught me to distrust some of these speculative estimates of cost and benefit, so I will not comment on that.
Greg Clark
The discussions we have had with the steel sector emphasise the importance of energy costs, and our commitment is to work with the sector to bring them down.
Philip Davies (Shipley) (Con)
Joseph Johnson
With higher and further education policy, apprenticeships and skills in a single Department, the Government can now take a comprehensive, end-to-end view of skills and education. This Government will, of course, support people from their early years through to postgraduate study and work.
National Minimum Wage (Workplace Internships) Bill
Philip Davies Excerpts(7 years, 6 months ago)
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Philip Davies (Shipley) (Con)
It is always a pleasure to follow my hon. Friend the Member for Bury North (Mr Nuttall).
I commend my hon. Friend the Member for Elmet and Rothwell (Alec Shelbrooke), my fellow west Yorkshire Member of Parliament, for bringing forward this Bill. As we all know, he is a very decent man. As my hon. Friend the Member for Bury North pointed out, he made a promise to his constituents and, as a decent, honourable man, he is honouring that promise. Nobody in this place should criticise him for doing that. It is what we have come to expect from him. Having said that, I do not think it was a particularly good promise to have made or to be fulfilling, although I admire him for following it through. I do not support the Bill but I do support—
Mr Rees-Mogg
I am sorry to intervene on my hon. Friend’s speech at such an early stage, but last year we established a tradition of congratulating the Chairman of Ways and Means on the brilliant way in which he carried out the lottery to ensure that our hon. Friend the Member for Elmet and Rothwell (Alec Shelbrooke) came third in the ballot and had this Bill to introduce. Perhaps my hon. Friend would like to say a few words on that subject.
Mr Deputy Speaker (Mr Lindsay Hoyle)
Let us assume that he does not need to, and we will get the lottery done shortly.
Philip Davies
There are so many things on which to congratulate the Chairman of Ways and Means that it would take me far too long to go through the list, so I shall refrain from doing so.
Alec Shelbrooke
May I offer a piece of advice to my hon. Friend, who I know is interested in making money in other ventures? Perhaps next time he would like to seek advice from the Deputy Speaker. I understand that I was one of the few people in the room when the ballot was drawn. Mr Deputy Speaker and I must be a lucky charm for that, so if my hon. Friend is looking for advice for his lottery numbers—
Philip Davies
I am delighted to hear that the ballot is not a fix, but I never thought it was.
We all support the ambition of my hon. Friend the Member for Elmet and Rothwell to see greater social mobility, and I know that that is what lies behind the Bill. That is the motivation that brings my hon. Friend to this place. The problem that I have, that some of my hon. Friends and some Opposition Members have—[Interruption.] There is only one Opposition Member in the Chamber at present, but others do exist. I know that they agree with the principle of social mobility and giving people more opportunities. The problem is that many of us think the Bill will not achieve that and will make the situation worse. I shall expand on that argument and point to what I think might be a better avenue for my hon. Friend to go down, which would genuinely create better opportunities for young people to make sure that we have more social mobility.
I yield to nobody in my demand that we have more working-class people in some of the professions. I made a speech earlier this week in Westminster Hall in which I argued for more working-class people to be in Parliament and made the point that gender diversity does not deliver social mobility, as my hon. Friend wants. I pointed out that replacing Rupert from Kensington and Chelsea with Jemima in Kensington and Chelsea does not do a great deal for social mobility or diversity in this House, and that we should consider how to open up more opportunities for people from different class backgrounds. I agree with the sentiment behind the Bill, but I think it will be counterproductive.
Since I entered the House 11 years ago I have taken on so many people for work experience, as interns or whatever people want to call them or call themselves, that I could not begin to say how many have spent time in my office doing one form of work experience or another. Like my hon. Friend the Member for Bury North, I refer to it as work experience because, as far as I am concerned, that is exactly what they are getting. Whatever we call it, and whatever we call those roles, these people, from what they have said, have all had a great experience and seen the workings of Parliament first hand. They have used that experience to go on and get fantastic jobs or to help them with their studies. If this Bill had been in place, and I had had to pay some or all of those people the minimum wage, I can state quite clearly that they would not have had that opportunity. That is not because I have any objection to paying people—that is not the case at all—but because we have a budget for staffing in the House. The budget is perfectly adequate, and I make no complaint about it, but there is not a great deal spare at the end of each year. So if my hon. Friend wants these people to be paid out of that budget, the only way of doing that is to reduce the salaries of the people who already work for me, and I am not sure that that would be entirely fair on them.
Alec Shelbrooke
Would my hon. Friend just help me with the opinions I am forming? Will he describe how long, on average, people have come to work with him for?
Philip Davies
I will come to that in a bit more detail, but just so that I do not look like I am dodging my hon. Friend’s question, let me say that it has varied wildly: some people come for a day, some come for a few days and some—I would imagine it is the majority—come for a week. However, some have come for months—five or six months in a couple of cases—and I will refer to them later, because part of their experience was part of what I see as the problem with the Bill.
The issue is what will be lost, and the definition in the Bill spells out what could be lost, not just in Parliament but when people are looking for jobs elsewhere. Clause 1(b) says the national minimum wage would apply where
“the purpose of the employment practice is…that the intern meets learning objectives or gains experience of working for the employer listed in section 1(a); and…to provide practical experience in an occupation or profession.”
That seems to be good old-fashioned, traditional work experience, but my hon. Friend seems to want to cover it through the minimum wage, and that would not be sensible. Learning and gaining practical experience are what is at stake. People doing work experience do it for the invaluable opportunity to gain that experience, and that is often something money cannot buy.
For many people thinking about going down a particular career route, spending even a small amount of time just seeing what happens and what the role actually means, rather than how it is portrayed in the media, is invaluable. They might actually think, “This job isn’t for me. I thought it was, because of what I thought about it, but after spending just a week here, I’ve seen what it’s really like, and it’s not for me.” The money someone can save by not pursuing a career that is no good for them is actually far more than they could ever earn by being paid the minimum wage for doing these things.
Mr Rees-Mogg
Do we not also have to have confidence in people and in the fact that they can make decisions for themselves? If they decide that they loathe the internship after a week, they are not paid and they are not contractually obligated, so they can leave and take on another internship or paid employment.
Philip Davies
My hon. Friend is absolutely right—as he invariably is, I might add.
Under the heading “What is work experience?”, the Government’s own guidance on their website about the minimum wage, work experience and internships says:
“The term ‘work experience’ generally refers to a specified period of time that an individual spends with a business—during which they have an opportunity to learn directly about working life and the working environment.”
I should say at this point that work experience has actually proven quite an essential part of the Government’s welfare reforms—reforms that Conservative Members, including, I am sure, my hon. Friend the Member for Elmet and Rothwell, are very proud of. I am sure we all recall when the Government had to introduce emergency legislation because they lost the Cait Reilly case in the courts over the work experience she was asked to do as part of her benefits regime. The Government introduced emergency legislation, the Jobseekers (Back to Work Schemes) Act 2013, which made it clear in law that people on benefits should have to do work experience in certain circumstances. Labour Members agreed to help the Government rush through that legislation because they too saw the importance of those people having to do work experience. The right hon. Member for East Ham (Stephen Timms), the shadow Minister at the time, gave Labour’s support to it. The legislation was about people doing unpaid work experience in the workplace because the Government believed, and everybody agreed, that that was one of the best ways to help them get into work. I think the Government said—I am happy for people to correct me if I am wrong—that about 50% of people on benefits who did the work experience got a job at the end of it. I would even be prepared to wager that my hon. Friend supported the Government in passing that legislation, because I am sure he appreciated how important that unpaid work experience was in people getting a job.
Alec Shelbrooke
Perhaps controversially, I have always felt that being given benefits from the state provides an income that can be used to help to get work experience and move forward. This Bill seeks to help people who have absolutely no means of supporting themselves through the benefits system or an income outside it. That is a subtle but distinct difference.
Philip Davies
I am grateful to my hon. Friend, but in making that helpful clarification he highlights one of the flaws in his Bill, because it does not make the exception that he has offered up with regard to who should be exempted from the terms of paid work experience. If he is saying that he wishes at a later date to add to his Bill another list of people who should not be part of it, then I welcome that. It is also the case that the Department of Work and Pensions introduced work experience as part of the youth contract, and that was probably one of the most popular parts of it.
I took on board my hon. Friend’s point—he made it very well—about some employers who might use internships for a purpose that some of us would not. I was struck by his example of Vivienne Westwood. However, we would be in danger of throwing the baby out with the bathwater if we went down the route in this Bill.
Bob Stewart (Beckenham) (Con)
Clearly, an employer who wishes to pay an intern could and should do so, if they have the money, but if they have to pay for internships, that comes off the bottom line and is a cost to the business, so undoubtedly there will then be fewer internships.
Philip Davies
That is absolutely right. This is the flaw in my hon. Friend the Member for Elmet and Rothwell’s logic. He says that he wants to even up the playing field to make sure that poorer people get the same opportunities that richer people get and take for granted. That is a laudable aim, and nobody disagrees with it. My fear is that he will succeed in evening up the playing field, but by making sure that nobody gets the chance to do work experience and internships. That is not my idea of success.
Alec Shelbrooke
Let me refer back to a couple of points I made in my speech. Two thirds of internships are already paid, so this Bill would not affect them. For me, the figure we must consider carefully is that 40% of people who are offered an internship cannot take it. People talk about reducing opportunities, but we are getting close to half of people being unable to take the opportunity in the first place.
Philip Davies
I will come on to that a bit later, because I have what I would like to think is a better solution.
It is a socialist outlook on life that says, “I would rather nobody had an opportunity than only some people had an opportunity”; it is certainly not one that any self-respecting Conservative could have.
Alex Shelbrooke rose—
Stephen Pound (Ealing North) (Lab)
There is a self-respecting Conservative.
Alec Shelbrooke
Quite right—I agree with the hon. Gentleman on the Opposition Front Bench, who speaks from a sedentary position.
I gently say to my hon. Friend the Member for Shipley that he quite rightly points out that my interest is social mobility, but rather than trying to bring it down to a common denominator I am trying to bring it up to a common denominator, so that people can access opportunities for social mobility. I understand his concerns, but there is a large difference between trying to push everybody down and being under the control of one socialist fist, and trying to make sure that everybody can go as high as they possibly can.
Philip Davies
Yes, I absolutely agree. However, my view is that the outcome of my hon. Friend’s Bill would be to take away opportunities from people and not to add extra opportunities for them. I will make a suggestion a bit later—if I ever get the opportunity to do so, Mr Deputy Speaker—to suggest how we might actually do what my hon. Friend says, which is not to take away opportunities that exist but to make sure that there are more opportunities for other people.
Mr Rees-Mogg
Will my hon. Friend examine the figures just given by our hon. Friend the Member for Elmet and Rothwell (Alec Shelbrooke)? He said that 40% of people do not take up internships because they cannot afford to, but 66% of internships are paid. That does not seem quite to work. It must mean that people are refusing to take up paid internships as well as unpaid internships, in which case simply paying people will not solve the problem.
Philip Davies
Of course my hon. Friend is absolutely right. That is a point that I, too, have considered during this debate, because my hon. Friend the Member for Elmet and Rothwell made a point about how expensive it is to live in London and to take accommodation in London, which is absolutely right. Many opportunities for internships and work experience are in London, so I have to say to him that paying under-18s £4 an hour—the current rate of the minimum wage for under-18s—will not give them the opportunity to come and take up a work experience place in London; they would still have to rely on parental support, other family support, or other means.
The Bill will not make a blind bit of difference to the people my hon. Friend is targeting. They still will not be able to afford to take up opportunities in London, which will still be the preserve of more affluent people. Again, that is why the Bill will not achieve what he sets out to achieve and why I think I have a better solution.
My hon. Friend the Member for Bury North (Mr Nuttall) was right: many people doing work experience are already entitled to the national minimum wage. We should make that point clear. I made it earlier in an intervention, but I see a difference between people who are—[Interruption.] I think that my hon. Friend the Member for Rugby (Mark Pawsey) does not agree with me here; he is a bit more hard-core than I am.
Philip Davies
As a well-known softie, I take a slightly different view. There is a difference between companies and organisations that are actively seeking a member of staff to come in and do some work for them, are advertising for that and in effect are trying to get somebody to do that job for nothing, and other companies. These are personal things, I guess; I think that situation is different.
I have never advertised for an unpaid intern. I have never said that I want somebody to come and work for me unpaid for x period of time. I do not think that that is right. Whether it should be illegal is a different issue, but I do not think that it is right; it is not to my taste.
Alec Shelbrooke
My hon. Friend is a thoroughly decent man, in stark contrast to the example I gave earlier of a certain millionaire fashionista.
Philip Davies
We do not hear that very often in this Chamber; I welcome that kind of intervention.
Mark Pawsey
I was going to make a distinction. It is known that MPs provide internships, so there would often be no need for my hon. Friend to advertise his own internship. However, if other businesses were minded to take on a young person and provide them with experience in that way, they would need to provide some mechanism to do so, and placing an advertisement would seem to me the obvious thing to do.
Philip Davies
That is a perfectly reasonable argument to make and I do not necessarily disagree with it. As I say, the questions that we decide in this place are whether things should be legal or illegal. I am merely saying that I do not personally think it is right to advertise for a job and expect someone to work unpaid; that is not to my taste. There is a world of difference between that and someone saying, “Can I come and do some work experience with or volunteer for you? I really want to do something. Will you accommodate me?” The problem is that the Bill does not distinguish between those two approaches, which is unfortunate, because there is a massive distinction between them.
Labour Members criticised the Government’s work experience scheme for people on benefits, saying that it allowed companies such as Tesco to exploit workers and get cheap labour. However, the Government said, quite rightly, that taking somebody on work experience is not cheap labour, because, usually, the employer has to invest an awful lot of time and effort into accommodating that person. I have no complaint about that. My hon. Friend the Member for Bury North is very happy to give up his time to give people career advice and help and support. I am sure that that applies to every Member, irrespective of their party. That is what we should do, but it is wrong to say that such people are a source of slave labour. The reality is usually the other way round: it is usually the employer who makes the sacrifice in order to give people the opportunity. I fear that the Bill does not accurately reflect the nature of that relationship. It seems to think that it is a one-way street when it is anything but a one-way street.
People are already covered by the national minimum wage legislation, and it would be wrong to pretend otherwise. Many forms of work experience, placements and internships are covered; equally, there are some, which may be referred to as unpaid work or expenses only, where somebody gives their services free of charge. My hon. Friend the Member for North East Somerset (Mr Rees-Mogg) has made a very good point: what is wrong with the principle of somebody giving up their time free of charge because they want to contribute to a cause they believe in, or because they want to help out? Who cares whether it is for their own benefit or for altruistic purposes? If that is what they want to do, why should we have a law that says that they must not be able to do it? I really do not think that the state has any business in stopping people volunteering for causes that they believe in. That would be the only possible outcome from the Bill: it would make it virtually impossible for people to volunteer for causes in which they believe.
The hon. Member for Elmet and Rothwell has mentioned data, but precise data are difficult to find. In 2010, the Government estimated that there were 70,000 interns at any one time. The most common length of an internship was recorded in a YouGov poll in 2014-15 as between four weeks and two months—that is very different from my experience of taking people on—with only 3% of internships lasting longer than a year. The same poll found that 26% of firms with an intern paid nothing or less than the national minimum wage. London Economics found that 13% to 16% of graduate interns are unpaid, but the Sutton Trust suggests that a third of them are unpaid. There is a big discrepancy between those two figures and I am not entirely sure which is right.
Many loaded statistics are used to justify a statutory requirement to make internships paid, such as those used to argue that unpaid internships are less likely to lead to a job offer, but with 47% of paid internships and 36% of unpaid internships leading to a job offer, it seems that both options are very good at enabling people to move pretty rapidly into a paid job. Surely one of the things that the Government should always be looking to do is to help people find a job as quickly as possible. It is clear from the figures that, whether it be paid or unpaid, an internship is among the most successful options in helping people find a full-time job. We should be celebrating that, not looking at how we can curtail it.
In 2010, the Chartered Institute of Personnel and Development did a survey of mainly large employers. It found that, among those that employ interns, 49% said that they paid interns the national minimum wage; 18% said that they did not pay interns a salary but covered their travel costs; and only 3% said that they did not pay them anything, meaning neither pay nor travel expenses.
The various options currently available for unpaid interns online show how useful such internships can be. One advert on indeed.co.uk says of its unpaid internship offer:
“Jewelstreet is the UK’s #1 designer jewellery website and has won multiple national and regional awards. We are offering a unique internship in a dynamic working environment, based in North Devon.”
I am delighted to see that my hon. Friend the Member for North Devon (Peter Heaton-Jones) is in the Chamber. It goes on:
“Additionally over 70% of our internships have resulted in an offer of permanent employment.”
That takes us back to the point, which was made by my hon. Friend the Member for Rugby, that if the company did not advertise it, nobody would know that such an opportunity was available. It is great—surely we should celebrate this—that 70% of the people doing an internship get an offer of permanent employment at the end of it. It seems to me that we should celebrate that in this House, not make a mess of it.
CDP is offering the following:
“The internship will be at CDP’s London office and the successful candidate will have the opportunity to be involved in a range of activities within the Cities team. It will be a valuable experience for anyone seeking a career in the area of climate change, sustainability and the urban environment. The internship will run across key stages of the project, including defining the scope and structure of the outreach, communications planning, engagement and technical support”.
Again, I am sure that a lot of people who believe in the cause of climate change and want to do something about it would find such experience invaluable, either to see whether they want to pursue a career in that area or so that they can campaign on that issue in their spare time. We should welcome such opportunities, not decry them.
I am trying to go through a few points at speed, because I know that some of my colleagues wish to speak. When my hon. Friend the Member for Elmet and Rothwell proposed his ten-minute rule Bill in 2014, he said:
“Just last year, the National Council for the Training of Journalists found in its 2013 report that 82% of new entrants to journalism had done an internship, of which 92% were unpaid.”—[Official Report, 13 May 2014; Vol. 580, c. 593.]
I am interested in that because when I was growing up, my ambition was to be a journalist. I am delighted that the Under-Secretary of State for Business, Energy and Industrial Strategy, my hon. Friend the Member for Stourbridge (Margot James), is in her place, because I did a week’s work experience at the local paper in Stourbridge to see what it was like and to try to fulfil my ambition to become a journalist.
There is no reason on earth why I should have been paid by the local paper in Stourbridge for what I did. As it happens, I had the opportunity to write a couple of stories and visit the local court to see some cases and report on them. I clearly was not doing the job to a standard that deserved any payment. It would have been outrageous if I had been paid for my efforts, which obviously needed rewriting on many occasions before they were fit to appear in the local paper. However, it was great experience for me just to see what went on in a local newspaper office. It was also fantastic when I applied for a National Council for the Training of Journalists course—the one-year course in newspaper journalism that I did at Stradbroke College in Sheffield—to be able to point out that I had such experience. That counted very heavily in my favour when I applied for the course. It was not a great hardship that I was not paid by the newspaper for that work experience; it was actually for my benefit. It certainly was not for the benefit of the newspaper, which I suspect had to invest a great deal of time and effort in looking after me for the week, and the work certainly did not justify paying me anything.
Philip Davies
It was a long time ago, but I think I was 18 at the time. If anyone still at the newspaper can remember, I stand to be corrected.
Mr Nuttall
The journalists weren’t still using quills, were they? I assume from what my hon. Friend has said that he went in every day for “regular work” and that he received “practical experience”, so it seems to me that he would have been covered by clause 1 of the Bill. The local paper may not have been so keen on having him if it had had to pay him.
Philip Davies
I agree with my hon. Friend; that is the danger. Whether I was covered by the Bill might be open to interpretation, but my suspicion is that this would have a chilling effect on employers. Rather than getting in to some argy-bargy over whether someone needs to be paid, employers would prefer not to go into it. They would rather sit it out. There is nothing in it for them—and, to be perfectly honest, there was nothing in it at all for the employers in my case as it was all done for my benefit. That is my worry. It is great that newspapers take people on to let them see the ropes and find out what working for a newspaper is all about. As it turned out, to finish the story, I realised after doing my course at the Sheffield college that journalism was not for me. Perhaps I should have done a bit more work experience before I got to that stage, so that I could have learned that earlier.
My hon. Friend the Member for Elmet and Rothwell looks at this issue from one end of a telescope, but I look at it from the other end. If people doing unpaid internships get the chance to get a job in their chosen field as a result, it seems to me that not being paid for their work experience is a small price to pay. That, I am sure, is what the people who offer to do these internships think themselves. Some 75% of the workforce in this field could be without this vital experience if unpaid internships were banned, and 75% of the people who undertook an unpaid internship have successfully entered the industry in which they wanted to work. I think we should celebrate that.
My hon. Friend the Member for Elmet and Rothwell quoted Alan Milburn at length, but I am not sure that that is a particularly persuasive thing to do in order to win me round. Perhaps I was not his target audience. I am sure that we were all supposed to drop our objections the moment the name of Alan Milburn was mentioned, but it did not work for me. However, the report my hon. Friend mentioned, which was conducted by Alan Milburn was, I think, published in 2009—[Interruption.] I have been corrected, it was 2012. It used research conducted in 2004 by the University of Manchester, which found that about 80% of employers had employed former interns. Again, I think that is a cause for celebration today—that these internships are leading to jobs.
Intern Aware sent me a briefing at the time of my hon. Friend’s ten-minute rule Bill, saying that 40% of those who thought of applying for an internship had reconsidered because they did not want to work for free. Let us look at that the other way round. It means that 60% did apply for an internship. We have seen how successful these internships can be so we should celebrate them. People are not doing an unpaid internship thinking that there is absolutely nothing in it for them and that they are being exploited by an unscrupulous employer; they are doing it because they can see the future gain that they are likely to get from doing so. If they did not think it was in their best interests, they might as well have got a paid job doing something else.
It is patently obvious that the number of opportunities will decrease if all these people have to be paid the minimum wage. Why on earth would someone who is running a business take on someone with no experience and spend time helping them, when they could pay the minimum wage to someone who already had some experience and could crack on with the job straight away? If people have to be paid the same, irrespective of who is taken on, who would an employer be likely to take on? It will not be someone who has no experience whatever; it will be someone who can be up and running on day one. We are talking about fewer opportunities for people who want to enter the workplace. Although that is an unintended consequence of the Bill, I have to tell my hon. Friend that it is a completely foreseeable one and we should not fall into that trap.
It was a known consequence that the introduction of the so-called living wage was going to cost jobs. When the previous Chancellor, my right hon. Friend the Member for Tatton (Mr Osborne) announced to a great fanfare the introduction of the national living wage, we knew straight away that it was going to cost jobs—for exactly the same reason as applies here. The Office for Budget Responsibility clearly stated when the living wage was introduced that, by 2020, as a consequence of the living wage, 4 million hours a week would be lost. It said that half of those hours would be lost on account of reduced hours for workers and the other half because of the loss of 60,000 jobs.
I could not believe my ears when I first heard that, so I checked with the House of Commons Library and the chairman of the OBR, and they could not have made it any clearer that increasing the amount that people had to be paid at the bottom end would cost 60,000 jobs. I do not know whether that is a great cause for celebration, although I know that plenty of people were celebrating at the time, but I do not really see it as such, and I suspect that the 60,000 people who are going to lose their jobs will not be celebrating by any means. In any event, the OBR made it abundantly clear that increasing employers’ costs in this way would mean far fewer opportunities. That is what it said about the national living wage, and it is obvious that, as night follows day, the same would apply to work experience positions if they were subject to the same regime.
I am absolutely at one with the hon. Member for Huddersfield (Mr Sheerman). It is a shame that he is not present today. He opposed my hon. Friend’s ten-minute rule Bill back in 2014, saying:
“Most people who know me might think that I would support the Bill, but the unintended consequence would be to damage some important opportunities for young people in our country. I…agree with the overall purpose of the Bill, but it will not hit the target. I am against exploitation and I am for fairness and social mobility, but I am also in favour of young people getting the experience that they need to enter the workplace. We need a balance.”—[Official Report, 13 May 2014; Vol. 580, c. 595-6.]
I could not agree more with everything that the hon. Gentleman said. The House divided on the Bill, and I was a Teller alongside the hon. Member for Huddersfield. I opposed it then, and I still oppose it today
Another issue that will not, I suspect, be addressed by the Bill is nepotism. My hon. Friend speaks of ordinary kids with modest backgrounds finding it difficult to access top jobs. It seems to me, however, that the problem is not that they are not paid for the jobs, but that, in many cases, they do not get a look in to start with. I think I am right in saying—and I should make clear that I do not decry anyone to whom this applies—that about one in 12 MPs is related to another MP, either current or former. I am not entirely sure that the Bill will make any difference to that—perhaps it should not make any difference—
Philip Davies
It was not for me to pinpoint anyone in particular, and I should say for the record that the ones who are in the Chamber are among the ablest and most effective. I would not have wanted to do anything that prevented them from being here. That is not my point. My point is that, in all circumstances, people will use whatever opportunities they have to further their aims and ambitions, and we should not criticise them for that. The notion that if we pass the Bill we will end up with a system that provides equal opportunities for everyone is for the birds. That is just not going to happen. I do not think that my hon. Friend would make many inroads with this measure even if it were successful.
It is commonplace in business, and in other spheres, for people to secure opportunities such as internships and placements on the basis of who they know rather than what they know. I would like to think that the fact that we in this place are able to offer unpaid internships, work experience or whatever we want to call it to all our constituents if they ask—I certainly would never refuse a constituent, and indeed I try to accommodate as many people as I can who are not constituents—means that everyone, not just people we know, is being given an opportunity. I think that unpaid internships are extending the opportunities to more people, and I do not think that it is simply a question of giving the opportunity to someone we know or to a relative. That is why I think that my hon. Friend is attacking the problem from the wrong end.
Alec Shelbrooke
The Clerks advised me against having a 28-day limit, but would that satisfy many of my hon. Friend’s concerns? I would be interested to hear him expand on that.
Philip Davies
I am grateful to my hon. Friend for being prepared to be flexible with his Bill. We should commend him for that. I think there are areas where my hon. Friend can make the Bill better, but just making it better does not make it better than the status quo, so I cannot promise that if he were to amend it in that way it would all of a sudden command my support. I would say, however, that the Bill can be better than currently drafted, and my hon. Friend might want to explore that avenue. I am not entirely sure the Bill can be amended to make it into a good Bill, but it could be amended to make it a better Bill.
We should be clear about the rates of the minimum wage. It varies depending on people’s age. That is because we want to make sure that younger people get a fair crack of the whip; they would potentially be overlooked for someone older and more experienced if the minimum wage was the same across the board. So the Labour Government introduced a minimum wage, which has been maintained, which varies depending on age: it is £7.20 for those aged 25 and over, falling to £4 for those under 18, with different scales in between. In this context, I want my hon. Friend to bear in mind a further unintended consequence of introducing his Bill: there would clearly be an inbuilt advantage to take on younger people as interns if they have to be paid, because if they are being paid the minimum wage, they will be paid less than the cost of taking on somebody older. In this case, therefore, for the business concerned it would be a case of the younger the better. Schoolchildren would be exempt, as would students in full-time employment if it was part of their course. So this means anyone of that age could be taken on as an intern—schoolchildren could be taken on as interns for free—but for those aged 25 or over, the sum would be £7.20 an hour right away.
Somebody of 25 or over might, however, be in the greatest need of work experience, because they have clearly been finding it pretty difficult to get themselves a paid job, and they are having to do more to make themselves employable. It would be unfortunate if people in that position, who are striving to get a job and are prepared to do whatever it takes, are turned away because they have to be paid £7.20 an hour, which an employer either could not afford or was not prepared to pay. They might take on someone younger who does not have the same needs. One of the flaws of the Bill is that it is not needs-based; it does not look at who most needs these internships. Its strategy is too simple and is therefore flawed. Older people will lose out first even though they are most in need. That would need to be amended.
There is also no exemption in this Bill for participants in Government schemes or programmes to provide training, work experience or temporary work. I do not know whether that would conflict with other Government legislation. I imagine there would be another charter for making lawyers richer—as my hon. Friend the Member for Bury North feared—in establishing which legislation had precedence. I am not a lawyer, and those with a legal background would be better placed than me to comment, but my understanding is that usually the latest legislation trumps previous legislation.
Philip Davies
I knew my hon. Friend would want to correct me, and I will of course allow him to do so.
Mr Rees-Mogg
I am grateful to my hon. Friend. I, too, am not a lawyer, but according to implied repeal, a later Act trumps a former Act—except, I am sorry to say, with the European Communities Act 1972, which has been deemed constitutional statute.
Philip Davies
I do not want to get into that, Madam Deputy Speaker—[Interruption.] Well, I do want to get into that, but not today.
Madam Deputy Speaker (Mrs Eleanor Laing)
Order. On the contrary, the hon. Member for North East Somerset (Mr Rees-Mogg) has raised a point that is relevant to the Bill we are discussing, and the hon. Member for Shipley (Philip Davies) would not be out of order if he continued the dialogue with him on that point.
Philip Davies
I am grateful for that guidance, Madam Deputy Speaker, but I fear that if I got sidetracked into talking about the latest decision by the High Court, we could be here for quite some time. I want to return to the issue but not today; I will save myself for another day, when I will tell the House what I really think of those judges and their ruling.
What I take from the intervention by my hon. Friend the Member for North East Somerset (Mr Rees-Mogg) is that, like me, he suspects that the Bill would in effect supersede previous legislation about work experience from Government schemes. We would therefore get ourselves in a bit of muddle. We all agree—both sides of the House agree—that people on benefits doing work experience is a good thing that should be expected of them, unpaid. It helps them to get a job and we do not want to interfere with a system that works very well for lots of people who are looking for jobs. The Bill would need amending on that basis.
My hon. Friend the Member for Elmet and Rothwell mentioned volunteers. If he gets the chance to wind up the debate, I hope he will deal with that issue because we have not had clarity on it. It is referred to in the explanatory notes, but they do not say a fat lot more than the Bill says, if I am honest.
The Bill is about enforcing the national minimum wage, and when the National Minimum Wage Bill was going through Parliament in 1998, the issue of volunteers was dealt with at length. The Minister at the time, Ian McCartney, said:
“I am pleased to say that the entire approach to the clause has been marked by a consensus both on our aims and on the means of achieving them. We want to ensure, first, that genuine volunteers—who give their time to good causes—are not caught up in the Bill’s provisions.”—[Official Report, 9 March 1998; Vol. 308, c. 23.]
The Labour Government at the time were clearly concerned about that issue, which was raised in the Bill Committee. I was not here at the time, but it appears that the Labour Government made changes as a result of concerns raised in Committee, which are the same as those raised by my hon. Friend the Member for North East Somerset, and they had discussions with people who were concerned.
During the debate, the then Minister said:
“We are conscious, however, that there is a grey area. The definition of ‘worker’ in clause 52”
of that Bill
“is quite wide, although no wider than the definition used for the purposes of provisions on unauthorised deductions in the Employment Rights Act 1996”.—[Official Report, 9 March 1998; Vol. 308, c. 24.]
It is an area of concern, and I am not entirely sure that the Bill does a great deal to clear up any confusion about that issue. It seems that the original National Minimum Wage Bill was determined to try to exclude real, genuine volunteers who were volunteering because they believed in a cause, so it would be strange if volunteer interns were now caught up in legislation that they were never really intended to be caught up in in the first place.
I might just say, Madam Deputy Speaker, that Mr Speaker spoke in the debate in 1998. I mention that not because I wish to draw him into the debate now—I do not—but because I agree with the point that he made. He said:
“Are there not instances in which a person works in a charity shop, not for an honorarium but for a modest but regular payment that is below the national minimum wage, and in which, if the shop were obliged to pay that person the national minimum wage, it would have to cease to employ that person? Would not that be a most undesirable state of affairs?”—[Official Report, 9 March 1998; Vol. 308, c. 29.]
Alec Shelbrooke
Following advice on drafting the Bill, clause 1 tries implicitly to make the point that it does not apply to the charity sector, by not listing that sector among the areas that the provisions apply to. We can get into the legal ups and downs, but that is the advice that I was given on exempting the charity sector, to address the specific point that my hon. Friend has just raised.
Philip Davies
I can understand the point my hon. Friend makes. The Bill makes it clear what a workplace is, but clause 3 deals with exclusions, and there is no mention of the charity sector in that clause. I absolutely understand what he is saying, but I am not sure that it is abundantly clear that that sector is excluded. A stated exclusion would have been helpful to clarify this point once and for all.
Mr Nuttall
My hon. Friend has drawn the attention of the House to the problem of volunteers. We have already established the fact that anyone who is doing work, whether or not they are called an intern, is covered by the national minimum wage legislation. If we are prepared to accept that volunteers will be excluded from the Bill, even though that is not explicitly stated, are we not left with a situation in which the only people who will be covered are the people who are doing nothing and who are simply turning up to watch?
Philip Davies
My hon. Friend is absolutely right.
The Bill’s attempt to expand opportunities seems to be all stick and no carrot. I have been looking at what happens in other parts of the world. My hon. Friend has touched on some examples of this as well. In a submission from Perspective in 2013 in favour of paid internships, Robina Longworth cited other practices from around the world. However, as far as I can see, none of the countries listed pays the minimum wage to interns. China and Hong Kong, for example, have subsidised internship programmes for university graduates and hiring companies are eligible for tax breaks and loans. Perhaps my hon. Friend the Member for Elmet and Rothwell might like to consider giving tax breaks to companies who take people on. That might be a better carrot to offer.
Alec Shelbrooke
My hon. Friend will have noted my proposal to add some carrot by exempting national insurance contributions in the same way as is done with apprenticeships.
Philip Davies
I am grateful to my hon. Friend for that intervention. It is inconceivable to me that the Bill would not result in fewer internships being offered. There would undoubtedly be fewer internships and work experience places. Nobody could say that the Bill would result in more such opportunities for people; there would be fewer. My point is that we should encourage businesses to offer more opportunities, particularly for those who do not get a fair crack of the whip. I know that he and I, and many other Members across the House, would like to see that happening, and perhaps tax breaks would be the answer. Rather than telling companies that they had to pay extra for offering these opportunities, perhaps we should consider giving them a financial incentive to do so. That seems to be a much more sensible and conservative way forward. I welcome what my hon. Friend said about national insurance contributions, but perhaps he should also consider tax breaks.
In Poland, there is financial support for engaging young people on internships. In Korea, there are wage subsidies for small businesses that hire interns on regular contracts. Those subsidies are offered at the conclusion of the internship, so the business is given a carrot to take the person on after they have been given a go to see whether they are good enough. And that is not just about the company seeing whether the intern is good enough; it also offers the intern an opportunity to see whether they want to work in that company or industry. That system appears to work for both sides.
I have had an idea for another thing that would be far better, and I hope that my hon. Friend will take this on board because I feel strongly about it. I have wondered about extending student loans to young people who do not want to go to university but want the opportunity to do something else. We give student loans to people, and I am sure that my hon. Friend would say from a social mobility point of view that they often go to people who are already affluent. In effect, the state gives them a subsidised loan at a preferential rate to enable them to live while at university and get a degree, which will then in all likelihood lead to them getting a higher-paid job than if they did not have a degree. It could be argued that it is like throwing apples into full orchards and that we are subsidising the people who are best off.
However, people who do not go to university are often the poorest in the country and they get nothing. They do not get a subsidised loan to pursue their career ambitions. Why not offer something like a student loan to, for example, someone from a poor working-class background in Yorkshire—
Philip Davies
Certainly not Lancashire.
That person may want to pursue a career in which they have a great interest, and such a loan, at a preferential rate, could give them the opportunity to come down to London to do the relevant work experience. They could then pay the loan back, just as university graduate does, when they are in a job that pays a certain amount of money. That would extend opportunities to people who currently do not get them. I have never quite understood why the only young people who get subsidised loans from the Government are those who go to university. What about all the other people who want to do something different?
Alec Shelbrooke
Specifically on those points, it will not have escaped my hon. Friend’s notice that the Bill contains an exemption for people on accredited degree courses. We were willing to put that in because many accredited degree courses contain a period of internship and—this was my reason—have access to student finance. He makes a valid point about granting that access to other people on the same terms, but—this is where I would blend my Bill in—there is a question about how to sort out the time limits on such a scheme. I am listening carefully to his comments. The Bill probably will not move into Committee, which is a great pity because many important things have been said in this debate that would help to develop it.
Philip Davies
I am grateful to my hon. Friend. He is being typically constructive, which goes to show that his dedication is not to a piece of legislation but to getting the best possible outcome for the people he wants to help. We all recognise his passion for this, and I am happy to work with him to help deliver it.
Let us take someone who wants to work in the fashion industry or the music industry, for example. The fashion industry was mentioned earlier, so let us say the music industry. It may be that doing a degree would not help them get a foot on the ladder in the music industry; it may or may not—I do not know the industry particularly well. It may well be, however, that spending six months at a record label in London after leaving school would represent a massive head start in getting a career in the industry. It would be good if the Government offered some kind of loan to enable someone to get that opportunity. They could then pay it back when they got a decent job in the industry. That would be a way to extend opportunities to more people, whereas the Bill would restrict opportunities.
Bob Stewart
That is a tremendous idea, to which I am hugely attracted. Small and medium-sized enterprises might also be hugely attracted to using such people in their companies.
Philip Davies
I am grateful to my hon. Friend. It is a red-letter day when my hon. Friend supports me.
Philip Davies
Certainly not a red rose. A red letter is far better than a red rose any day of the week.
As for Members of Parliament, an FOI request of IPSA asked about the number of interns and paid interns working for MPs over the past three years. It seems that about one in four MPs took on a paid intern, but I am pretty sure that virtually every MP takes on people to do work experience of some sort or another and that everybody who does so gets something out of it. Given the number of people we take on to give that opportunity to them, if we had to pay them all the minimum wage, that would take up a sizeable part of our budget. It would mean either that we could not afford to take them on or that we would have to give our existing staff a pay cut. Neither of those would be a palatable option, but they would be the only options available to us.
Strangely, the Bill does not seem to recognise that people have short-term and long-term internships. My hon. Friend the Member for Elmet and Rothwell mentioned that issue, so I will not go into it further as he would wish to look at it. I have spent longer than I expected speaking to the Bill—[Interruption]—because of the number of interventions I have taken. In concluding, I just wish to mention a couple of people who have spent time with me. Before I go into that, I should just say that the Bill will mean we will probably end up with more people on zero-hours contracts. I know that quite a lot of Labour MPs employ people on those contracts, even though they are against them politically. [Interruption.] Does that mean zero-hours contracts are a good thing?
Alec Shelbrooke
I am conscious that my hon. Friend is drawing his remarks to a close, but what I have drawn from his comments is that he agrees with me that there must be a mechanism by which people can do these roles and be able to live, survive and do something. He has come up with interesting suggestions, but I think that he recognises the premise that we reduce social mobility if someone simply cannot afford to take up the post.
Philip Davies
Yes; as I said at the start, we all want to achieve the same thing, which is to expand the number of opportunities for people, particularly those who do not always get them at the moment. I do not know anyone in the House who would not share that ambition—I certainly do. The Bill would take us in the opposite direction, which is why the suggestions I have made would be better in trying to deal with the position my hon. Friend has set out.
In conclusion, I wish to talk about a couple of people who have spent time with me. One of my previous researchers, Grainne, initially started working at my office on an “unpaid internship”, as it would be described; it would fall within the scope of the Bill without any shadow of a doubt. She had left university and was struggling to get a job. If I had had to pay her, I would not have taken her on, not only because I could not have afforded to, but because I knew nothing about her. I did not know anything about her credentials, but she wanted to come to have a go and I was happy to facilitate that. This is what she said about the value of her internship when she went to speak at a school about her experience of getting a job in politics:
“Having tried unsuccessfully for months to get a paid job, the feedback I kept hearing again and again was that ‘you don’t have enough experience’. But how do you get experience if no one will give you a job? So I decided to apply for an unpaid internship with Philip Davies MP—in the hope this would lead to something more… I was made to feel like a fully integrated part of the team and given a wealth of opportunities that I would otherwise not have achieved.... Without my unpaid internship I am convinced I would not have been given such an excellent opportunity.”
When a job became available in my office, I gave it to her because she had proved herself and done such a good job in that time. She went on to say:
“From Parliament I moved to a Comms agency, before working in the Public Affairs team for a large corporate. I then became a Special Adviser and am now back in House working for a FTSE 125 company as their Director of Corporate Affairs.”
She is about 30 years old. She continued:
“I would not have been able to achieve any of this without my unpaid internship.”
Another intern, George, who completed a five-month unpaid placement in my constituency and is now working for my hon. Friend the Member for Christchurch (Mr Chope), said:
“Without the internship I very much doubt I would be working where I am today. Being able to have that first hand experience on my CV was invaluable to getting the job I have today, and I have been able to apply the experience gained to other areas in my role now”.
I employed my current researcher, who has done a marvellous job helping me on the Bill, after she completed a two-week work experience placement while at university. She did that not as part of her university course, but in the holidays, because it was something that she wanted to do. I am not sure whether that would be covered by the Bill, but I suspect that she would have had to be paid. She said that without doing those couple of weeks in the office, she would not have had the opportunity to show herself capable of the job when it arose, and that is absolutely true.
I want to see more opportunities for work experience and internships, and the Bill will inevitably lead to fewer such opportunities. I admire my hon. Friend’s passion on social mobility, but I hope that he will reflect on the ideas that I have set out today. In future, perhaps a Bill that covered some of the points made today will go some way to achieving the ambition that we both share.
Margot James
The hon. Gentleman takes my example a little too far, but one can only imagine such an outcome as being highly likely.
Now, let me introduce Jack. Jack’s father works for a landscape-gardening company and just about makes average earnings, and his wife works part-time as a carer. As a family, they are just about getting by and they think Jack will get on fine because he is a bright boy. But Jack is already disadvantaged by some of the choices he made at GCSE which ruled out the sort of A-levels the Russell Group universities favour. He has no contacts in London and his family cannot afford to support him through an unpaid internship. Unlike Susan I think Jack would probably be one of the 40% of young people my hon. Friend the Member for Elmet and Rothwell indicates would reject an internship if offered on an unpaid basis. Those case studies illustrate to me that my hon. Friend is really on to something in challenging the concept of unpaid internships under the conditions set out in his Bill.
However, we believe that good, worthwhile, genuine internships certainly have a part to play, alongside other routes such as work experience, apprenticeships, work placements and work shadowing, all of which we have heard a great deal about in our debate. I believe we all recognise that young people learning about the workplace, developing skills and getting training can produce networking opportunities in and of themselves. Employers can also benefit from fresh thinking and from finding potentially great new permanent employees to join their team in future.
There are many different types of internship. The Gateways to the Professions Collaborative Forum, for example, represents about 60 professional bodies. We have heard about the excellent programme of paid internships that is run from the Speaker’s quarters in this House. In the attempt to define high-quality apprenticeships as an arrangement whereby individuals work and can gain some compensation, there is also the prospect that they will develop professional skills and an understanding of a profession. Those are all good experiences and we would not want obstacles to their fulfilment to be created unnecessarily from any unintended consequences of legislation.
There are many excellent resources, such as the Government-backed graduate talent pool, which is an initiative designed to help new and recent graduates to gain real work experience across Government. It advertises quality internships with a range of desirable employers in numerous competitive sectors. Most significantly, 100% of the vacancies advertised through the graduate talent pool are for paid positions. A 2011 survey of more than 500 people registered with the pool found that over 60% of respondents were motivated to join in order to improve their long-term prospects and gain general work experience, and it showed that over 80% of interns would recommend the experience and scheme to others.
Another example is the popular RateMyPlacement website, which I heard my hon. Friend the Member for Shipley mention—I think in relation to some experience he offered to a young person from his constituency. Graduates and interns can share their experiences of placements anonymously on the site and often find specific guidance on such things as interviews and general careers advice.
There is an increasing wealth of information out there, for employers as much as anyone else, about what well-managed, high-quality internships look like. However, we all know that not all the internships we are debating today are good quality and properly managed, and I think we all, across the House, aspire to improve our system such that there ends up being just good-quality, preferably paid—and certainly compensated—internships in future.
Let me turn to the point that several hon. Members have made: that workers do have rights. Workers have a contract with their employer under which they perform work to agreement and both parties must get something of value from the arrangements. The contract does not have to be written and the value provided to the person performing the work might initially be the opportunity to gain experience or the promise of future work. Other factors to consider are whether a person has the right to send someone else to do the work and whether the person is better viewed as working for the employer rather than being engaged by an independent contractor.
A genuine worker has a “day one” right to be at least paid the appropriate national minimum wage or the national living wage if he or she is over 25. When a court looks at a person’s employment status, it will always consider the reality of their working arrangements and not just how those are described. Simply labelling someone as an intern is not enough to exempt them from the rights associated with being a worker.
However, there is no universally agreed or accepted definition of the term “intern”, despite many attempts to define it today. I sensed considerable sympathy for the view expressed by my hon. Friend the Member for Bury North that it was perhaps a glorified Americanism used to describe what is effectively work experience. We must acknowledge that there are bad examples of work experience and internships, but let me make it absolutely clear that the Government believe that all people in the UK are entitled to fair wages for fair work.
Philip Davies
If we complicate this too much, is there not a danger that employers trying to avoid having someone classified as a worker would simply get people in to do menial things such as making the tea, rather than doing a proper job? Most people who do work experience really appreciate being able to muck in and do something worth while. It would be a strange state of affairs if employers were deterred from offering meaningful work experience lest they fall foul of the legislation.