National Minimum Wage

Seema Malhotra Excerpts

Wednesday 15th January 2014 Commons Chamber

[Rachel Reeves]

I suggest that Government Members look at what we are debating: the national minimum wage. I know they do not want to talk about it, because they did not support it in the first place, but it would be nice if they could talk about its impact on their constituencies. However, I think we may have to wait for another occasion.

We have a Government who opposed the national minimum wage when it was introduced and who are not enforcing the legislation properly today. Thanks to an investigation by the independent Centre for London, we know that as many as 300,000 workers are being paid less than the minimum wage. We have reports of workers having the costs of uniforms, accommodation, transport or training illegally deducted from their pay packets. We have shocking accounts of working conditions for some people in sectors such as elderly care which hurt not only employees but vulnerable people who need a reliable and good-quality service from people who are paid a decent wage. There are stories of legal loopholes being used to bring in migrant workers who are, as my hon. Friend the Member for Stockton North (Alex Cunningham) said, forced to work at exploitative rates of pay that also undercut and undermine the pay and conditions of all workers.

Despite that, the number of enforcement cases opened or registered has fallen in every year of this Tory-led Government, and it is now at less than half the level it was in the last year of the Labour Government. Since this Government came into office, just two prosecutions have been brought for non-payment of the minimum wage. They have repeatedly said that they will name and shame firms that are flouting the legislation, but they have not named a single one.

[Seema Malhotra (Feltham and Heston) (Lab/Co-op)]

My hon. Friend is making a very powerful speech. Does she agree that perhaps one of the reasons the national minimum wage has not been enforced is that Government Members are not 100% committed to it? For example, the hon. Member for South Northamptonshire (Andrea Leadsom) has called for businesses with three employees or fewer to be exempt from the national minimum wage, as well as from regulations on maternity and paternity rights.

[Rachel Reeves]

Not only are Government Members not 100% behind the national minimum wage; they cannot even bring themselves to say “national minimum wage”.

--- Later in debate ---

[Vince Cable]

I did not particularly wish to raise this, but I am being asked personally to explain why I did not vote. It had a lot to do with the fact that my late wife was terminally ill at the time and I was in the Royal Marsden hospital. That is why my voting record at the time was poor on that and other issues.

As it happens, my party supported the national minimum wage; nobody opposed it. I became the party’s spokesman shortly after the vote and I made it absolutely clear throughout that Parliament that we supported the principle of the national minimum wage. There was never any question about that.

Perfectly legitimate issues were raised about why there was no regional variation. There is a proper debate to be had about whether there should be a regional or a national minimum wage. As it happens, I endorsed the principle of the national minimum wage. However, there is a perfectly respectable argument for regional variation. As I understand it, the Labour party now promotes the living wage, at the heart of which is the idea that there should be regional differentials, with people in London being paid more and people in the west country or the north of England being paid relatively less. There is an argument for that. Why criticise people who have put forward that idea in good faith?

As for the Conservatives, although I do not always speak in their defence, I think that they should get credit for accepting that there is a good system that works and for deciding to support it. That is creditable. Although I and my party have supported the national minimum wage, there is a perfectly respectable intellectual and moral argument for not having a minimum wage. Countries that do not have a minimum wage include Sweden, Finland, Norway, Denmark and Austria. Those countries are all in the social democratic tradition, but have felt that it is too problematic. Germany, which has had either social democratic or national unity Governments for most of the post-war period, has adopted a national minimum wage only in the last few weeks. In those countries, where there are civilised values and a sense of solidarity, the costs and benefits of the minimum wage have been debated properly. Why should we criticise people in this country who wanted to have such a debate, but who have now come to a consensus that it is a good system and that we should make it work?

[Seema Malhotra]

Is the Secretary of State saying that Government Members and Conservative Members in particular support the national minimum wage for all businesses in all circumstances?

[Vince Cable]

Yes, it is now the law. Of course we support enforcement of the law. I do not understand the question.