Women’s Contribution to the Economy

Sharon Hodgson Excerpts

Thursday 6th March 2014 Westminster Hall

[Dr Coffey]

I thank my hon. Friend for that comment. I understand that the management board and Ministers in the Department for Business, Innovation and Skills were invited to do unconscious bias training, although I believe that the only Minister who was able to do it was my hon. Friend the Member for East Dunbartonshire (Jo Swinson). I agree that we should be proactive. There are companies that have offered to run courses for MPs. That has been on my to-do list for some time, and I will ensure that it gets done.

Our report recommended that companies should normalise flexible and part-time working. We should encourage companies to review their culture so talent does not drain away from the pipeline unnecessarily. Evidence shows that the best way to make flexible working a standard practice is to ensure that it is a non-gender issue. Companies know that they have a role in inspiring members of the next generation in the subjects they take and their career choices.

Finally, I come to our recommendation about head-hunters, for whom there is already a voluntary code of conduct. I want to draw Members’ attention to the review undertaken by Charlotte Sweeney at the instigation of the Secretary of State for Business, Innovation and Skills, my right hon. Friend the Member for Twickenham (Vince Cable). It was launched earlier this week, and it looks at the voluntary code of conduct.

Head-hunters can play a significant role in helping us to reach Lord Davies’s target of ensuring that 25% of board members are female. I welcome the report’s ambition that the code should be a minimum standard and that we should aspire to more. To achieve that, we must encourage as many head-hunters as possible to sign up to the code.

One way of promoting the code is for the Government to lead by example. I am encouraging the Cabinet Office to ensure that all head-hunters used by the Government and their agencies are signatories to the code. We know that currently they are not. I had a conversation with my right hon. Friend the Member for Meriden about that issue, and I will take it up further.

[Mrs Hodgson]

I recently met some senior women in higher education, who said that head-hunters are a barrier to their progressing to senior positions, such as vice-chancellorships of universities. The hon. Lady is talking about a good measure.

[Dr Coffey]

I find that fascinating. I have not thought about higher education because I have been focusing on business, but I will add that to the discussion that we will soon be having with Cabinet Office advisers.

Charlotte Sweeney’s report stated that the use of the code should be extended to the executive pipeline. That is music to my ears. We seek to persuade the Government and business to back the initiative. It is where the most difficult challenges lie, but it is vital to ensuring long-term progress. The report that I co-authored made a similar recommendation. I look forward to the forthcoming head-hunter summit, which my hon. Friend the Minister, my hon. Friend the Member for Brentford and Isleworth and I will be chairing, and which will allow us to have a discussion about what is happening to the code, how we can improve it and what we can do to extend it further. I am excited about that initiative, which will take place within the next month.

Locally, we in Suffolk recognise the value of women’s contribution to the economy. I pay tribute to the New Anglia local enterprise partnership, which has launched a campaign to help women fulfil their economic potential. A report by the LEP established that a woman working full-time in Suffolk will, over her career, earn £332,000 less than a man, and will pay £83,000 less in tax. The LEP is right to note that those employment and pay gaps represent lost income for families, lost opportunities for growth and lost prosperity for the county.

I have spoken for considerably longer than is my wont, but I feel that the report that we put together last year and whose recommendations we continue to follow up deserves a good airing in Parliament. We can all unite around this issue, although I expect that Government Members are not keen to legislate; our ambitions are elsewhere. There are a number of initiatives that we should support. We should be pleased that 37% of start-up loans went to women, and we should be pleased by the recommendations and initiatives undertaken by the Women’s Business Council. We should be pleased that this agenda is firmly on the map for the Government and the Opposition.

It is a waste to our economy if women who want to are not able to work at the top of industries, universities and the public sector. We should put our shoulders to the wheel and keep pushing. There will be a tipping point at which women start to play a full part in business, the economy and politics.

[Mr Jim Sheridan in the Chair]

[Mrs Sharon Hodgson (Washington and Sunderland West) (Lab)]

It was a pleasure to serve under your chairmanship, Mr Robertson. I am sorry that you are leaving, but you are being replaced by the lovely Mr Sheridan, under whose chairmanship it is also a pleasure to serve.

It is great to be here for this excellent debate on international women’s day. Many important issues have been covered at length, as one is able to do in a three-hour debate when half our number are engaged in an important debate in the main Chamber. However, what we have lacked in quantity we have more than made up for in quality. The debate has not suffered for the lack of Members present.

I am pleased to be in the debate with the hon. Member for Brentford and Isleworth (Mary Macleod), who has organised a full programme of excellent events today, culminating with tea with the Speaker in Speaker’s House for women MPs who are being shadowed by young women from their constituencies. Most of us are being shadowed by at least one young woman today, although the hon. Member for Mid Derbyshire (Pauline Latham) is being shadowed by six—she is a pied piper leading the way on this issue. I thank the hon. Member for Brentford and Isleworth for organising today’s events, which are appreciated by us and the young women who are shadowing us. I thank the right hon. Member for Meriden (Mrs Spelman) and my hon. Friend the Member for Slough (Fiona Mactaggart) for securing the debate and enabling us to gather here to talk about such important issues.

Women helping and inspiring other women is obviously a key recurring theme of international women’s day. It is right that we promote it as a means of increasing women’s participation in the economy and public life, particularly at the higher echelons. When it comes to the scale of the challenges that we still face in promoting women in the workplace and harnessing their potential to contribute to the economic success of the country, everyone needs to pull together in the same direction to achieve the kind of change that we need.

The Minister will be well aware that the director general of the Confederation of British Industry made an important intervention on that theme earlier this week, on the back of a PricewaterhouseCoopers report that ranked Britain 18th out of 27 OECD countries for the participation of women in the economy. He rightly called for the current generation of top executives to set a much better example and really drive through the changes that will see women progress much further in the private sector. As part of that, he advocated the use of targets for women in senior positions, as a signal to the whole organisation that its leaders want those changes to happen.

That call has seemingly been heard by the Secretary of State for Business, Innovation and Skills, who has asked the Equality and Human Rights Commission for advice on whether all-women shortlists for top jobs will be legal. That apparent reversal in the Government’s position is very welcome, as indeed it was to hear the hon. Member for Mid Derbyshire talk about the fact that her party is now looking at all-women shortlists. As she knows, I was selected under an all-women shortlist, and they have been very successful for the Labour party in raising the number of women in Parliament, so it is very welcome to hear that her party is looking at that.

With regard to top jobs, targets are not just a means of promoting equality, which is an important end in itself; firms with greater representation of women in the boardroom and in senior positions throughout the organisation are much more likely to be successful businesses. However, the Minister and her colleagues might want to look a little closer to home. This is where, in this celebratory debate, I may come across as a bit critical, but I am the Opposition spokesperson, so you would surely expect nothing less, Mr Sheridan. It is also important to be brutally honest when discussing these important issues, and not just talk about the good bits.

I asked a series of parliamentary questions and I was quite shocked at some of the answers. Almost half of Government Departments are failing to meet the targets for women on boards that Ministers expect of top businesses. It is particularly poor to see that the Ministry of Defence, for instance, has no women on its board at all, and that only two Departments have more women than men on their boards. That is symbolic of a wider trend in senior appointments by the Government since 2010. Only 17 out of 114 Privy Counsellors appointed are women, and 13 out of 85 policy tsars are women. Fewer than one in five ambassadors and a quarter of permanent secretaries appointed since 2010 have been women.

[Fiona Mactaggart]

On the point about public appointments and women, I have been chasing Government Departments since 9 February—for a month—to try to find out what proportion of paid public appointments are given to women. I keep going round a particular circle, which gets me to a published statement by the Cabinet Office that gives the total number of appointments of men and women but does not state how many are paid. Frankly, the vast majority of those appointments are, I think, women to the magistracy, because the vast majority are in the Ministry of Justice. We really need those figures to be more transparent.

[Mrs Hodgson]

My hon. Friend makes a very good point.

[Mrs Spelman]

rose—

[Mrs Hodgson]

I think I am just about to be intervened on by somebody who might have the answer.

[Mrs Spelman]

Just for the record, the Government achieved a 50:50 ratio of men and women in the role of permanent secretary when a female permanent secretary was appointed to my Department in 2012. Much more interesting questions are why there is such an attrition rate among those women in senior positions, and why there might have been a falling away.

[Mrs Hodgson]

I am not sure that that answers the question asked by my hon. Friend the Member for Slough (Fiona Mactaggart), but perhaps the Minister will glean the answer before her winding-up contribution.

This point is important, because if the Government expect to inspire and/or cajole top businesses to meet the 25% target for women on boards, which is a very welcome target and we certainly should expect them to meet it, they have to show much stronger leadership on the issue. I look forward to hearing from the Minister how she will ensure that that happens.

Coming back to the PricewaterhouseCoopers report, one of the most telling graphs was on the proportion of women in full-time employment; the UK came last but two. That echoes the findings of the recent Institute for Public Policy Research report, “Childmind the gap”. In more than two thirds of the countries it surveyed, fewer than 30% of mothers worked part time—that is, for less than 30 hours. In the UK, it is more than 60%, so that is more than double the proportion of mothers working part time in this country than in the vast majority of others surveyed. We know that women are working part time either because they cannot find full-time jobs, or because they cannot afford or are unable to organise the child care, especially if they work unsociable or atypical hours. The Department for Work and Pensions’ own survey found that 43% of parents who have kids aged three to four and would like to work, or to work longer hours, cite affordability of child care as a barrier to doing so.

That is unsurprising, given that parents are being hit by what I call a triple whammy. First, child care costs are increasing way ahead of wages; according to the Family and Childcare Trust report a couple of days ago, costs for nursery care have risen by 27% since 2009 and continue to rise higher than inflation. They are now the largest family outgoing, outstripping even the average family mortgage. The right hon. Member for Meriden mentioned that, too. The second part of the triple whammy is that places are being lost; we have 1,500 fewer childminders and 900 fewer nurseries since the election, and the same report from the Family and Childcare Trust found that nearly half of local authorities—49%—do not have enough places for working parents. To round it off, the third element is that support for those on low and middle incomes through tax credits has been cut.

That is creating not only a cost of living crisis, but a cost of working crisis, which is bad for business and bad for the Treasury. The IPPR’s study suggests that a 10 percentage point increase in maternal employment rates to bring the UK more in line with our more successful European neighbours would bring a net benefit to the public purse of £1.45 billion a year. It also estimates that increasing the rate of full-time work among those mothers who already work part time by just three percentage points would generate a net benefit of £450 million a year. The study goes on to estimate that by equalising the labour force participation rates of men and women, the UK could increase its GDP per capita by 0.5% a year, with potential gains of 10% by 2030.

Because we on the Labour side of the House want to achieve those fiscal and economic gains under a future Labour Government, every working family will receive 25 hours of free, high-quality child care for their three and four-year-olds for 38 weeks a year—an increase of 10 hours a week on the current offer. That is help worth £1,500 a year per child per working family, paid for from a levy on the banks. As convenience is the key concern for parents of school-age children, our proposed primary child care guarantee will ensure that they will be able to access breakfast and after-school clubs through their school between the hours of 8 am and 6 pm.

Of course, the other side of making work pay is decent incomes for women and, certainly, parity with male colleagues in comparable jobs. In December, official figures revealed that the gender pay gap increased in 2012-13 for the first time in five years to an average of 10%. We heard from my hon. Friend the Member for Slough that for older women the figure is actually 18%. Under Labour, the gender pay gap fell by 7.7%, and it is deeply disappointing to see those gains going into reverse. Concerted effort is clearly needed to put us back on a positive course, but perhaps the most significant issue is that women are often clustered in low-wage jobs, as well as being far more likely to have poor conditions and even zero-hours contracts.

One in four women earns less than the living wage, meaning that even if she is in work and works as many hours as she can, she will still struggle to make ends meet. That cannot be right. Labour wants to make work pay for women by allowing firms to claim back one third of the cost of raising their staff’s wages to the level of the living wage, which is currently £8.80 in London. We will also strengthen the minimum wage and tackle the abuse of zero-hours contracts and agency workers, which again are a feature of the sectors in which women are over-represented.

Clearly, there is also an issue about aspirations among young women. We heard about that from a number of hon. Members. I do not think that aspirations are a problem for the young women shadowing us today, but I do know that far too many girls are still channelled down the “hair or care” path in school and further education, whereas their male counterparts will be pushed towards apprenticeships and other vocational qualifications with higher earning potential. The Government, to their credit, have recently been making a lot of positive noises on that, and particularly on the issue of driving up participation in STEM subjects—science, technology, engineering and maths—in further and higher education.

I echo comments made by a few hon. Members about maths and science subjects. I am pleased to announce that my daughter is studying for her final exams in her maths A-level, which she will take later this year, but she is one of only a handful of girls in her A-level class. On average, girls make up only about 25% of maths A-level classes across the country. That must change because, as the right hon. Member for Meriden said, maths is one of the most valuable A-levels to obtain.

The one thing that the Government could do much better is the provision of high-quality careers advice. We have these conversations with young girls, but particularly important is individual face-to-face advice, which can inspire girls to aim higher, telling them how to get to where they want to be and giving them ideas, rather than reinforcing the old stereotypes and a learned lack of aspiration, which still holds back far too many of our young people.

Of course, employers have their part to play in all this. Yes, we need women in leadership roles, but also right along the pipeline. I know that there are many great employers in the UK. At the end of January, I met representatives of a dozen or so, who were telling me about some of the great packages of support that they make available for working mums, particularly while they are on maternity leave and when they come back to work. The one that I will name today is Ford Motor Company. Ford employs more than 11,000 people in this country and it not only gives its female employees a year’s maternity leave on full pay—I imagine that applications will flood in now—but offers them parenting support and classes, as well as an on-site nursery and emergency child care for when things go wrong—for when the child is ill and cannot come into the nursery. It also has facilities for new mums to breastfeed and express milk at work. Why does Ford do that? Yes, it does it because there is value in being seen as a family-friendly company, but primarily—I asked the company—it does it because it knows that having women in positions of influence over its products and marketing gives it a competitive advantage over its rivals, because women control most of the major purchases in most households. Buying a car is a decision that most women have a big say in. [Hon. Members: “Hear, hear!] And rightly so.

We can see from that example why all those studies have shown that businesses with more women in positions of power outperform their less diverse counterparts. If 50% or more of a firm’s consumers are women, it makes sense to have people at the top of the organisation who know what women want—that is, women. If I may be just a little critical, perhaps that is why the coalition parties are faring so badly among female voters at the moment; there are not enough women in the top positions.

However, despite the clear common-sense case for promoting women in business, there are clearly still some bosses from the Nigel Farage school of equality. According to Maternity Action, 60,000 women are forced out of their jobs a year because they have the gall to become pregnant. To make matters worse, the Government are now forcing those women who have the energy and time, while pregnant or coping with a new baby, to take their employer to a tribunal to pay £1,200 to do so. The Minister probably believes that we are scaremongering when we talk about those fees, but we do feel that they will often put off quite vulnerable women from holding their employer to account. I do not think that those women see it that way; they do not think that we are scaremongering.

The Equality and Human Rights Commission is looking into pregnancy discrimination; that is very good. The Government have funded a report, and I sincerely hope that the Minister is pressing for the time scale for the report to be as short as possible, so that she will have the opportunity to act on its recommendations before the general election in 2015. None of us wants to take a punitive approach to equality, but given that we know how much better companies perform when women are not forced out, there is clearly as much of an economic imperative to stamp out discrimination as there is a moral one.

Of course, a successful economy needs to embrace the creative and entrepreneurial flair of its citizens in setting up their own businesses and creating new jobs and wealth. Unfortunately, as we know, fewer than one in five SMEs are wholly or majority-owned by women, which hints at specific barriers to women striking out on their own. The hon. Member for Solihull (Lorely Burt), who is no longer in her place, has done a huge amount of work in this area and chairs the all-party group on women and enterprise, which I have recently joined. However, the silver living to that statistic is that it hints at a huge untapped pool of talent and creativity that could be put to good use. That is one reason why Labour has said that, instead of the Government’s corporation tax cut for the largest firms, we will help more people to start their own business by cutting business rates in 2015 and freezing them again in 2016 for small businesses.

The economy may well be back in growth after a period of sustained malaise, but that does not lessen the importance of doing everything that we can to enable women to contribute. The twin ends of greater equality and a more productive economy are not mutually exclusive; they are intrinsically linked. Greater female participation, better pay and conditions, greater progression and greater representation of women in senior and board-level positions are not ends in themselves. They are the means by which the UK can remain at the top table of world economies over the next 20 years, or achieve a respectable position in the Prime Minister’s “global race”. I admit that the Government are doing some things, and Opposition Members warmly welcome them, but this debate has been a timely reminder that until we are making real progress on all the measures necessary, we can and must do more.

Women are ready to play their part; in fact, they have always been ready. It is the responsibility of all of us, on whatever side of the House we sit, to remove any barriers in their way. We must not pull the ladder up behind us, which I am sure none of us in this Chamber would do, but ensure that we lower it and give a helping hand up to even more women, to enable them to follow us and successful women in all sectors and, ultimately, to achieve their full potential.

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[Mrs Grant]

The hon. Lady has raised that issue before, and I know that she is concerned about it. As she knows, there is a remission system, so when people do not have the money to pay the fee, the state will step in. That remission system has been around for some years, and it has worked very well. I trust that it will continue to work well to ensure that people have access to justice, a concept that is very important to me and to others.

[Mrs Hodgson]

I want to point out that I raised the question of the gender pay gap. I mentioned that in 2012-13, the gender pay gap for full-time workers rose for the first time in five years to 10%. I have listened to the Minister telling us about the measures that the Government will take, but will she give us an assurance that the gender gap will not increase further during her term of office?

[Mrs Grant]

I apologise to the shadow Minister for not mentioning the fact that she had raised the gender pay gap; I, of course, heard her. It is an important issue, and I think we are making progress. The overall gender pay gap still stands at just under 20%, which in my opinion is completely unacceptable, but I believe that the two measures that we are taking—one of scrutiny in relation to compulsory pay audits and the other about transparency through “Think, Act, Report”—will have the desired effect.

A number of interventions have been made by hon. Members today. I am not sure whether I will be able to deal with all of them, but I will do my best. My right hon. Friend the Member for Meriden raised the geographic disparity in women’s employment rates and suggested that cultural factors might be partly responsible. There are a number of factors at play, and cultural heritage may well be one of them. We want to help all girls and women to fulfil their potential, and we have a programme of work for that purpose to raise girls’ aspirations, which includes a school and business partnership and a resource for parents to help them support their daughters with their career choices. A number of excellent organisations are helping us, including QED-UK, a project that supports women of Pakistani heritage into employment in south Yorkshire, which is making excellent progress.

The hon. Member for Slough asked whether I would discuss with the Department for Education the issue of young girls receiving advertisements for jobs ancillary to sex work. I am appalled that young women are receiving adverts for jobs ancillary to adult entertainment, and I will certainly raise that issue with my ministerial colleagues.

The hon. Lady and my hon. Friend the Member for Suffolk Coastal spoke in detail and with great authority about women on boards. I share their concern that where women are getting board roles, they are more likely to be successful in non-executive roles. If we are to make real and proper progress in that area, it is essential that we focus on developing the executive pipeline. I would like to acknowledge the excellent work of an organisation called Women 1st, to which I gave a keynote speech this morning, which is trailblazing in this area. I look forward to hosting and chairing an event involving head-hunters in the next few weeks with my hon. Friend the Member for Suffolk Coastal and others.

The hon. Member for Solihull (Lorely Burt), who is no longer in her seat, remarked on the poor showing of the UK, in comparison with the United States, on enterprise. If she were here, I would be saying to her that the Women’s Business Council is prioritising women’s entrepreneurship. At a meeting yesterday, members of the council discussed what they could do as leaders in industry, and they discussed issues such as positive role models and positive behaviours. The council is determined to make further progress in that area.

My hon. Friend the Member for Suffolk Coastal spoke in detail about science, technology, engineering and maths, about which she knows an awful lot. I agree with her that we need to encourage more girls to study STEM subjects and raise their aspirations. That topic will be discussed at the United Nations next week, at the Commission on the Status of Women. I am happy to say that the Secretary of State for Culture, Media and Sport, my right hon. Friend the Member for Basingstoke (Maria Miller), and Nicola Yates, a Women’s Business Council member from GlaxoSmithKline, will be advocating on behalf of the UK the need to support girls into those disciplines and sharing best practice with a truly international audience.

One of our enlightened men—unfortunately he is no longer in his place—my hon. Friend the Member for Finchley and Golders Green (Mike Freer), raised the need to get our girls to do A-level maths, which is an important issue. Action is being taken, and £200 million of Government investment has gone into STEM higher education teaching facilities, and higher education institutions will be required to match funding. The Department for Business, Innovation and Skills is also funding a programme of work to promote diversity in the STEM work force.

My hon. Friend the Member for South Basildon and East Thurrock (Stephen Metcalfe), who has left the room, spoke about men as agents for change. We need to have the men with us on this agenda if we are to make progress. I always say that when courageous women meet with enlightened men, there is very little that they cannot achieve. I am pleased that he made that contribution. On 20 February, John Timpson of the Women’s Business Council hosted a round-table meeting with male CEOs to develop strategies to support flexible and modern workplaces. It is important for male leaders to demonstrate leadership in that area, and their doing so shows commitment and best practice.

The shadow Minister and the hon. Member for Slough raised the issue of women and public appointments, especially in Whitehall. The Government are absolutely committed to increasing the diversity of public appointments, and we have recently established a centre for public appointments, which works right across Whitehall and with executive search industries to modernise the recruitment practices to public boards. The Government’s aim, which the shadow Minister may be aware of, is for 50% of new public appointments to be women by the end of the Parliament, and we have recently published an action plan for achieving that. We are making progress; 37% of public appointments made by Whitehall Departments in 2012-13 were women, and that has risen to 45% in the past six months.

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[Mrs Grant]

I shall do my very best to provide the hon. Lady with the information she has requested. I would also be happy to meet her if she needs further information once she has received what I will endeavour to send to her.

[Mrs Hodgson]

I raised the issue of departmental boards. They are obviously not representative, and I know that the Minister has said that that will be addressed, but are departmental board positions paid or unpaid?

[Mrs Grant]

May I write to the hon. Lady on that, just as I will write to the hon. Member for Slough?

This has been a wide-ranging and informative debate. It is also a critical debate for our society and economy. I would like to conclude with a reminder of some of the findings of the Women’s Business Council, which reported last June and continues to work with the Government and business to drive forward this important agenda. It found that by equalising the labour force participation of men and women, the UK could increase economic growth by 0.5% per year, with potential gains of 10% of GDP by 2030. It also found that if women were setting up and running new businesses at the same rate as men, we could have an extra 1 million female entrepreneurs.

As the Prime Minister repeatedly says, we are now in a global race, and, as those figures from the Women’s Business Council show, it is a race that we cannot win unless we make full use of the skills and experience of everyone in our economy. I hope I have made it clear that this Government will do whatever it takes to ensure that we support women in the economy, and to transform the world of work so that many more women have the opportunity to achieve their aspirations.