National Minimum Wage

Debate between Rachel Reeves and Ian Mearns

Wednesday 15th January 2014 Commons Chamber

[Rachel Reeves]

Two million jobs were created under the last Labour Government and employment reached a record high, so I am not sure where the hon. Lady gets her statistics from.

I have quoted the former leader of the Liberal Democrats but, back then, where was the Secretary of State for Business, Innovation and Skills, the right hon. Member for Twickenham (Vince Cable)? He was nowhere to be seen in the debates. He was nowhere to be seen on the voting record. On Second Reading and Third Reading, he failed to vote. Apparently, he abstained because he had reservations about a minimum wage. Perhaps he will stand up today to profess his concern for the plight of the low-paid. I am happy to take an intervention from the right hon. Gentleman if he wants to make one.

[Ian Mearns (Gateshead) (Lab)]

Although the Secretary of State for Business, Innovation and Skills had reservations about the minimum wage, many of my neighbours who worked in the security industry on 90p or £1 an hour back then are eternally grateful for the Labour Government’s action in introducing the minimum wage. It made a massive difference to their lifestyle.

[Rachel Reeves]

I thank my hon. Friend for that intervention, which reminds me of a story that my predecessor as MP for Leeds West told me. He saw a job advert in our constituency for a security guard back in the mid-1990s that said, “Pay, 90p an hour. Uniform provided. Bring your own dog.” Those were the sort of jobs that existed back then, but members of this Government opposed the national minimum wage legislation. I look forward to hearing what the Secretary of State for Business, Innovation and Skills has to say later, but people will be entitled to ask him where he was when we abolished the scandal of jobs paying less than £1 an hour and when British workers won the right to be paid a decent minimum wage.

Regional Pay

Debate between Rachel Reeves and Ian Mearns

Wednesday 20th June 2012 Commons Chamber

[Rachel Reeves]

My hon. Friend makes a very important point.

[Ian Mearns (Gateshead) (Lab)]

Given the perverse logic that Government Members put forward, will my hon. Friend reflect on the fact that despite the disparity in public and private sector pay rates in the north-east of England, unemployment is going up? We might have thought that investment would be flooding in on the basis of cheap wages in the private sector.

[Rachel Reeves]

I thank my hon. Friend for that point and look forward to hearing what the Minister has to say in response.

As well as the business people and other experts whom I have quoted, the key stakeholders have made their views clear. Not just the trade unions but employers and independent experts have expressed concerns. For example, NHS Employers notes that employers already have

“the option to pay recruitment and retention premia”—

that is related to the point made by the hon. Member for Finchley and Golders Green (Mike Freer)—

“to address…specific labour market issues.”

It states that a move to local pay bargaining would

“raise issues of local capacity, increase administration costs and risk pay inflation as employers compete directly for staff on pay. Getting rewards wrong could have a significant impact on the quality of patient care and safety.”

The National Employers’ Organisation for School Teachers states that

“the existing four national zones, plus the flexibility to pay recruitment and retention supplements…provide an appropriate balance between national determination and local flexibility…the existing framework provides a reasonable level of autonomy to set pay”.

It reports that 84% of its members

“considered that the number of pay bands was appropriate to reflect local labour market conditions; only 7% thought this was not the case.”

The National Governors Association reports that it is

“not aware of any evidence that suggests making pay locally responsive would improve recruitment and retention.”

It points out:

“Low cost of living indices tend…to be associated with social deprivation; these areas may also…have difficulty attracting the best staff… As the Government is rightly concerned to narrow the attainment gap between those children from disadvantaged backgrounds and those who are not, bringing teachers’ salaries in line with local market conditions…would possibly be counterproductive and create recruitment difficulties that do not currently exist.”

The evidence is clear, and so are the views of the experts, but the Chancellor’s posturing has created real worries for public service workers around the country. Nurses, teachers and police officers are already suffering the effects of the pay freeze and being hit by the sharp hike in pension contributions, and like everyone else they are suffering the effects of the Government’s recession, unfair tax rises and cuts. Now, the Chancellor is threatening to impose policies that for many people in many parts of the country would mean real-terms cuts in their income, continuing year after year. That would force them to pay the price for the Government’s economic failures. The millions of workers who are keeping our public services going in difficult times, the majority of them women on modest wages, deserve better than that.