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Mr. Denis MacShane (Rotherham): It is a great pleasure to follow the hon. Member for Rutland and Melton (Mr. Duncan), who made a speech for the Opposition. He talked about all the terrible things that have happened for most of the past 50 years. I must ask which party has been in power in the past 50 years--or the past five, 10 or 15 years. His speech reflected the split in the Conservative party. We heard the first glimmering outlines of the new philosophy of what will be a split Tory party in opposition. I wish the hon. Gentleman well, as I admire his intellect. I do not have to agree with what he produces, writes or says, but I admire intellectual dexterity, and he has much of it.
We talked earlier of tadpoles. The hon. Member for Rutland and Melton talked of kissing Baroness Thatcher in the hope that she would turn into a frog--or perhaps it was the other way round. Clearly the hon. Gentleman is prepared to embrace the past, in the hope that it will define the Tory party's future. He is the author of a remarkable book, which I am sure has been read by all Conservative Members, called "Satan's Children". I recommend it to everybody.
Mr. Duncan: "Saturn's Children".
Mr. MacShane: Oh, "Saturn's Children". Forgive me. I knew that it was project Pluto or a message from planet Portillo, but getting the name exactly right escaped me. We look forward to reading it. As the author of many a remaindered book, I hope that the hon. Gentleman's publishers did not print too many copies.
The fundamental difference in this debate, which we saw in the sniggering from the Government Front Bench during the speech of my right hon. Friend the Member for Manchester, Gorton (Mr. Kaufman), is that the Opposition attack poverty while the Government attack the poor. That is certainly the impression in the country.
Far cleverer than Karl Marx, the contemporary Conservative party has created not one but two reserve armies in the labour market. The first is the reserve army of the unemployed. We do not know how many people are unemployed, because the Department of Employment, that famous massage parlour for unemployment statistics, has been abolished. So the debate that used to entertain
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both sides of the House is over. We no longer know whether it is 2.5 million, 3 million or 4 million, because the Department of Employment and its vital statistical work in that area exist no more. However, we still have a massive reserve army of unemployment to drive down wages.I admire the Conservative party, which has not ruled this country on and off for 300 years for no good reason. It has created a second reserve army: the poverty-in-work army. That consists of those in employment of a sort-- part-time, low-paid or zero-hours-contract employment. Like Blu cher arriving on the field at Waterloo, the Conservative party's armies of unemployment and poverty helped to render the lives of so many people insecure with low pay and unable to plan with any confidence in the future.
I simply ask hon. Members who will troop through the Lobby in an hour and a half's time to think of our children, nieces or nephews who have left university in the past couple of years. How many of them have a job or a job that matches the educational attainment into which they have put so much effort? We all know that the answer is: very few. We are talking about the future of our country, those who have invested in education and, like many hon. Members, gone to university and attained degrees. Yet they now find that their lives are ebbing along on minuscule wages and hand-to-mouth jobs, because we have so tilted our society's labour market away from work. I pay tribute to the eloquence of my right hon. Friend the Member for Gorton, who showed a mastery of statistics that I cannot repeat. He offered us a long statistical narration that held the House. In my constituency of Rotherham, one in six men are out of work. They are men without destiny or hope, condemned not just to regular signing on but to the new water torture of the jobseeker's allowance and the salami tactics of taking away from them any hope of sustained help from their fellow citizens, via the state, to conduct their lives decently.
Unemployment is now a bit lower. What a funny turn of phrase to say that unemployment is lower. We define our society in the ebbs and flows of unemployment rather than permanent, enduring job creation. Unemployment is a little lower than a couple of years ago, thanks to a significant devaluation, which has provided the boomlet that the Prime Minister and his Cabinet make so much of in their speeches. But compared with 1990, there is now 20 per cent. more unemployment among male workers in Rotherham.
The hon. Member for Stratford-on-Avon (Mr. Howarth) talked about a society divided against itself, and a war of all against all. He is good at reeling off Hobbesian phrases. Let us compare the present with 1979, when life was, perhaps not a paradise, but far better for male workers in Rotherham than it is now. It was also better in 1970, 1960, 1951 and the first half of 1945--all years when this country was governed by a Conservative Government. I shall come back to that point later in my speech.
What is fascinating about the society in which we live is not the non- application of old or new Labour party or socialist ideas, but the betrayal of the idea that we live in one nation and even a betrayal of the Conservative philosophy which, until the past 15 years, accepted a sense of responsibility for social community.
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Every week at my surgery, since I was elected a year ago, I have confronted someone whose life prospects would be helped-- [Interruption.] My cough is caused by the filthy smog in which we have to live under the Tory Administration but that is another debate. At each of my surgeries-- [Interruption.] I ask hon. Members either to stand up or shut up. If they are sitting down, they should let me get on with my speech.Mr. Jacques Arnold: Would the hon. Gentleman tell us whether smog in London was better in the halcyon days of 1950, 1945 and before?
Mr. MacShane: As a small boy, I dimly recall struggling my way to school through dreadful foggy smogs. How grateful I was for the excellent Clean Air Act 1956. This is rather a big diversion, but how I wish that the Government could return to those values of seeking to lift up the general status, health and social standards of the entire nation.
To return to the debate--even if the House is relatively empty--I recall that a vigorous couple, the man aged about 30, recently came to my surgery with their two children. He had signed a contract for £8,500 a year to deliver computer parts for a company in Sheffield. He was getting up a 7 o'clock in the morning to deliver his orders, working right through the day to 6 or 6.30 pm, coming home and spending an hour or two planning his delivery route for the next day. His hourly rate of pay was under £3.50.
They were young, vigorous, confident people, and he and his wife had calculated that they and their two children would be better off on the various forms of benefit that are available. He asked whether he could move to an hourly rate, but there is no mechanism for that. I asked him whether he was a member of a union. He said that he was not, and that, if he joined a union, he would be dismissed. I asked what would happen if the other drivers joined him and put it to their employer that they should get a better hourly rate. His answer was that they would all be sacked on the spot.
I see that the Secretary of State for Education and Employment, who has taken employment back under her wing, is smiling, but that is the life story of millions of people--a life story of low pay, no help and more hope with social security.
I have a letter from a Mr. William Clarke in my constituency, who came to see me. I urged him to go to the jobcentre to find a job. He is 53, and a qualified heavy goods vehicle driver. There are plenty of heavy goods vehicles on our roads; there is plenty of trade--we are told that the economy is booming. But no one will give him a job. He went to the jobcentre, but he reports that all the HGV jobs are temporary with flexible full-time hours, temporary with full-time hours, or temporary but only in categories for which he is not qualified.
He went to be retrained and added extra qualifications to his HGV qualifications to get a job. What did he find? The job qualifications had suddenly changed. In much of our industry, employers are taking on workers only if they qualify for family benefit. Single young males who are relatively unskilled will not be given a job. Males who are not single, but are skilled and have a wife and children will get jobs. That may be good. I am all for encouraging employment for male family heads of household, but they are taken only because of the taxpayers' subsidy via the benefit system. That cannot be right.
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The Rotherham picture fits into the national one. There are 1.5 million of our citizens, thousands in each of our constituencies, who earn less than £2.50 an hour--the price of a Pimm's on the Terrace. We have to pay £2.5 billion as a taxpayer subsidy to firms each year. I shall be interested to see whether the Secretary of State will deal in her winding-up speech with the idea of a national minimum wage and what that costs in Europe, a subject of which much was made earlier in the debate.The unemployment statistics for Europe show that, in Austria, Denmark, France, Germany, the Netherlands, Italy, Spain and Sweden, just to cite EU members--I am quoting the latest issue of The Economist --the unemployment figures are falling as fast as, if not faster than, in the United Kingdom. Four times as many jobs are being created in Germany as in Britain, and that is with the social chapter and wage negotiation that amounts, in effect, to a national minimum wage.
Other speakers have referred to Asia--the hon. Member for Rutland and Melton certainly did. However, the base for the success of all the Asian economies is a much more compressed ratio of wages of employers and employees--8:1 in Japan compared to over 30:1 in Britain. There are no Richard Greenburys earning 100 times the starting wages of the equivalent of a Marks and Spencer shop assistant in Japan. In Hong Kong and Singapore, too, there is a much narrower differential in the ratio between the bosses and what the people who actually generate the wealth earn than in the United Kingdom.
That is also true of the rest of Europe. The ratio of earnings of the chief executive officers and chairman of the top firms in France, Germany and the Netherlands to those of their employees is much smaller than in Britain. The fundamental problem is that there has been a significant devaluation of employed work in Britain. We are moving to a rentier society, with rich incomes for those with funds invested and miserable giro payments that destroy morale for those who depend on state benefits.
In essence, the values of 1968--of anything goes, what I want I can have, what happens next door does not concern me--have been embodied in the contemporary Conservative Government. That is why Labour is appealing against greed at the top and against a society in which people's expectations are set by lottery winners, the values of Hugh Grant or the salary of Cedric Brown. Instead, we are trying to return to a society in which people's values are based on community and neighbourhood.
The argument of the Conservative party is, as I understand it, based on the Laffer curve nonsense about taxation. The rich do not work hard enough because they are not rich enough and, according to the Secretary of State for Social Security, the poor do not work hard enough because they are not poor enough. That is a fundamental divide.
Mr. Geoffrey Clifton-Brown (Cirencester and Tewkesbury): The hon. Gentleman seems to have based his entire diatribe on the idea that the Government should spend more. Perhaps he would consider the example of the United States, where Government expenditure as a percentage of GDP is 35 per cent., yet their unemployment rate is only 5.4 per cent., down from 6.7 per cent. a year ago. If he thinks that an incoming Labour
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Government will somehow magically improve employment prospects in this country, how are we to compete with the United States?Mr. MacShane: I shall pray in aid the Speaker of the House of Representatives, the honourable Newt Gingrich, who voted for an increase in the national minimum wage in 1990 and 1991. The Americans seek to put a floor under exploitation precisely so that the state does not have to subsidise low-pay employers, which is the philosophy of the British Government.
I would buy into some of the Conservatives' arguments if they applied the American experience, and if, for example, there were 52 regional Parliaments and control was decentralised from Whitehall. However, the fundamental difference is that in this country we have neither the American experience nor that of our more successful European or Asian competitors.
That was recognised more than 100 years ago by that well-known socialist Benjamin Disraeli, who proclaimed:
"the first consideration of a Minister should be the health of the people".
He was not talking about health solely in terms of hospitals, but in the broad social sense.
In his excellent book entitled "The Great Democracies", Winston Churchill described what the Conservative party did in the 1870s: "A Trade Union Act gave the unions almost complete freedom of action, an Artisan's Dwelling Act was the first measure to tackle the housing problem, a Sale of Food and Drugs Act and a Public Health Act at last established sanitary law on a sound footing. Disraeli succeeded in persuading much of the Conservative party not only that the real needs of the electorate included healthier conditions of life, better homes, and freedom to organise in the world of industry, but also that the Conservative Party was perfectly well fitted to provide them."
How far the Conservative party has travelled since then. Its meanness and indifference and its sniggering about poverty that we have heard from Conservatives today proves how unfit, how divided and how irrelevant contemporary Conservatism is, whether of the Vulcan or the "dithering", "don't know" and "undecided" factions.
If we want to build one nation again, we shall need a change of Government. Only a Labour Government can deliver to the citizens of Britain the one nation they need and merit, and in which they should live.
8.41 pm
Mr. Jacques Arnold (Gravesham): I am most grateful to the Opposition for choosing a debate on social and economic policy. My only regret is that their motion does not live up to the occasion. Labour's motion condemns what it calls "damaging inequality", but it does not deal with the fact that the policies that Labour has traditionally espoused would bring about a damaging equality. What concerns me is that Labour's policies would create a damaging equality between the working men and women of Britain and the workshy. We have heard nothing about the measures that Labour would introduce to encourage working people. Labour policy invariably deals with how one can increase the income of the workshy, which results in employment traps which in turn are a major problem for the social and economic fabric of this country.
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The motion then condemns so-called "insecurity". It should certainly be tackled, but it stems largely from the rapidly changing world economic situation. We have always said that no one owes us a living, but the tiger economies and Latin America are coming up rapidly and beginning to compete with us. It is indeed the case that no one owes us a living, but how would Labour policies deal with the serious insecurity facing us? We have seen the steps taken by the Government, but the Labour party offers in exchange only the minimum wage and the social chapter. Many of my colleagues have dealt with those two particular Labour policies. There is no doubt that if they were carried out as Labour proposes, insecurity in this country would increase considerably.The Labour motion goes on to say that
"the Government must take action which promotes employment opportunities, particularly for the long-term unemployed, increases the skills and adaptability of the workforce".
It is clear that Labour did not listen to the opening speech of my right hon. Friend the Secretary of State for Social Security, who catalogued the steps taken by the Government. Indeed, those steps are outlined in considerable detail in the admirable Government amendment.
I shall now concentrate my remarks on the current trends in social and economic policy and their impact on the family. I wonder how many people have faced up to the facts. Today, one in five families with dependent children is headed by a lone parent compared with only one in 12 in 1971. How many people are aware that the proportion of families headed by single mothers who have never been married has grown from 1 per cent. to 7 per cent. in the same period? Today, nearly one in three births occur outside marriage compared with one in 16 only 30 years ago. Marriage rates have reached their lowest point since records began more than 150 years ago. There has been a sixfold increase in the annual divorce rate since 1961. If current trends continue, four out of 10 new marriages will end in divorce. Two out of three mothers with dependent children have jobs or are actively seeking work compared with fewer than half only 20 years ago. Economic activity among mothers of children under five has increased from just over a quarter to almost half. Those facts have been exacerbated by a mixture of changing employment patterns and the impact of the tax and benefits structure.
I would contend that the social and economic policy followed for many years has resulted in the undermining of the breadwinner. The strength of the role of the father-provider of the family has been severely eroded. In the past 30 years, this country has lost 3 million relatively well-paid full- time jobs for semi-skilled and unskilled male factory workers, and modern technology has also limited the low-skill male jobs in transport, warehousing, retailing and offices.
As a result, the unemployment rate for young low-skilled males is high, despite the development of new schemes and training by the Government. That has led in turn to those very young men not providing what is known as a "marriage prospect" to eligible young women and a low rate of creation of stable marriages in which to bring up children. Their loss of self-esteem derived from full wage packets also leads to delinquency and crime.
Conversely, modern technology has created millions of new jobs requiring greater skills, and they are more suited to the aptitudes and preferences of women. Jobs are also
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more flexible and not necessarily full time. That has created a swing in the balance of employment, encouraging female employment to such an extent that nearly half the work force is female. Indeed, more than 50 per cent. is expected to be female in the year 2000, and many women are maintaining their jobs through parenthood. The net result has been the undermining of the father as breadwinner, and it militates towards single-parent families, illegitimate births and divorce, all of which have an impact on the children of the nation. The trend for mothers of young children to work is growing. It is interesting to note that the proportion of working married women with children under five has risen from 27 per cent. in 1977 to 47 per cent. four years ago, according to the latest census. That has not happened through choice.The social attitudes survey shows that 76 per cent. of mothers thought that they should stay at home full time with their children. The figure rose to 80 per cent. in lower-income groups. [Interruption.] The hon. Member for Peckham (Ms Harman) is shouting from a sedentary position, but the fact is that, unlike her, most women would prefer to stay at home and look after their children.
Ms Harman: How long are women to spend at home looking after their children? Are they supposed to stay at home until the children are 30, or perhaps 40? It is no good making a blanket statement to the effect that women must get out of the labour market for ever once they have children. Clearly, they must leave it temporarily, but how long does the hon. Gentleman have in mind?
Mr. Arnold: How long is precisely as long as those children need their mother properly to develop them. My worry is that the fact that if mothers do not stay at home, especially if they wish to, it damages the development of their children. As I said, the social attitudes survey shows that 76 per cent. of those mothers believe that they should stay at home, and the statistics increase to 80 per cent. in lower-income groups. The mothers know the impact on their children in terms of socialisation, nurturing and support. The House should ask itself, why have those mothers done so? The answer is that real and perceived financial need have driven them to do so. Prices, especially housing costs, have increased to absorb two salaries; as the job market has changed, wages have adjusted to equality through lower unisex rates; and taxation policy has progressively removed the previous bias that favoured the family. In recent years, taxation policy has changed savagely, withdrawing favoured status from married couples and causing a heavy impact on the family. That has come about in response to calls for fiscal simplicity and sexual equality. In recent years, we have split the taxation of the family. When a mother gives up paid work to care for her children, she forfeits not only her income, but her tax allowance, which is worth at least £880 to the family and is not transferable to the husband.
There has been a further impact on the married couple's allowance--which has been frozen, and therefore eroded in value, for the past four years-- through the downbanding from standard rate to the 20 per cent. band last year and to the notional 15 per cent. band this year.
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The benefit to families has been reduced from £430 a year ago to £258 this year--a loss to every family of £172. Further, if the married couple's allowance had kept up with inflation and had continued to be applied at the standard rate, it would be worth £200 more this year.Mr. MacShane: I am genuinely interested in the line that the hon. Gentleman has pursued. Does he agree that, if we want to consolidate family life and, especially, give young children a good start, it would be helpful if we could enact parental leave provisions that would allow both parents to spend time with them, particularly with young babies, in the first six months, 12 months, 18 months or two years?
Mr. Arnold: Proposals such as that would be just as damaging as the minimum wage in wrecking the chances of families with young children of getting jobs. We should be bolstering the father in being the breadwinner, and structuring the tax system so that mothers can stay at home, as so many of them wish.
It is interesting to note that, for the average family with the mother caring full time for the children, the impact of the loss of her income and tax allowance benefit combined with the devaluing of the married couple's allowance and mortgage interest relief for families is a severe squeeze on family net income.
Tax and national insurance contributions for single persons on average income have declined from 31.5 per cent. in the last year of the Labour Government to 28.6 per cent. today, despite the increase in taxation in recent years. They have declined less for a married person, from 27.8 per cent. to 26.8 per cent., but the significant statistic is that the burden of taxation on married couples with two children under 11, assuming a non- earning wife and taking into account child benefit, has increased from 20.9 per cent. to 21.9 per cent.
A Conservative Government must pay attention to that. Our taxation policies have had an adverse impact on families, whereas the impact on single persons and married couples without families has improved. It is time that the Government took that very much on board. The Treasury has benefited considerably from recent measures such as the reduction in the married couple's allowance. The married couple's allowance, as we recall, was introduced in 1991 with independent taxation, and it now applies to 10.5 million families. The Chancellor, by reducing that tax allowance from the 25 per cent. band to the 15 per cent. band this year, has made some considerable savings, and salt has been rubbed into the wounds of families by the impact of the so-called allowance restriction on personal tax coding, which draws attention to and emphasises the 15 per cent. band. I wonder how many people realise that the gain for the Treasury and consequent loss for families has already increased to £2,090 million simply as a result of the downbanding, and that the impact since 1991-92 of not increasing the married couple's allowance for inflation has been a benefit for the Treasury at the expense of families, of a further £3 billion. The impact on families of the downbanding of mortgage interest relief at source has been that the Treasury has gained more than £1 billion at the expense of the family.
I hope, therefore, that, in preparing his Budget this autumn, the Chancellor of the Exchequer will produce a Budget for the family. I believe that he should restore the
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married couple's allowance to the standard rate band, which would cost the Treasury £2.4 billion. There should be no similar restoration of the additional person's allowance for single parents of children other than for those who are widowed, as that would be a disincentive for illegitimacy and for divorce.A capacity should be introduced for non-working mothers with dependent children to transfer their basic allowance to their working husband. If that were to be done, there would be a major impact, worth £861 to the family, at a cost to the Treasury of £2.8 billion. I believe that, in considering social and economic policies, we should consider the impact on the family. If the Government face up to those matters in the Budget in the autumn, not only will there be a significant effect on the employment market through releasing jobs currently carried out by mothers and making them available to less skilled males, which will have an economic benefit as a spin-off, but we shall reverse the tide that has worked against the family, to the detriment of the development and growth of our young people. 8.57 pm
Mr. Ken Purchase (Wolverhampton, North-East): Few of my constituents would recognise themselves in the picture that the hon. Member for Gravesham (Mr. Arnold) painted. In contrast to the smaller micro-economic analyses that have just been made, let me mention one or two global statistics.
Unemployment costs the nation between £20 billion and £30 billion per annum. The former Department of Employment's own figures clearly show the average cost of an unemployed person in terms of benefits and revenue and spending power forgone. That is the nature of what we face today.
It is all very well Conservative Members saying that unemployment has been falling for X months. Bearing in mind the way in which unemployment is measured, they cannot be accused of telling us anything that is not true, but, as other hon. Members have said, there have been so many changes in the way in which the employment statistics are collected in recent years that no proper comparison can now be made between when the Conservatives took office and the present day.
My hon. and learned Friend the Member for Leicester, West (Mr. Janner) said that the true comparison was between roughly 1,050,000 people in 1979 at the end of the Labour Government and 2.5 million now. We can accept with glad hearts and great pleasure the fact that some of our constituents have found work in recent months, but whatever Conservative Members tell us about unemployment falling, it does not alter the fact that the record of the Conservative Government on employment is abominable in every sense of the word. As a result of the growth in unemployment, the social security system is less and less able to cope with the demands placed on it. Although the cost of social security in real terms has doubled, benefits paid are now worth less to the individual than in 1979. So we have had a doubling of the cost yet less support for people who are unemployed or otherwise unable to get into the labour market.
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Other recent statistics show that one third of males aged 16 to 65, and therefore potentially economically active, are not in employment for one reason or another. It is no wonder that the social security budget is creaking at the seams. It is no use Conservative Members telling us that they intend to clamp down on scrounging. Opposition Members support that: we do not believe that people should be able to obtain by fraud, cheating or other methods benefits or anything else to which they are not properly and fully entitled.Let me summarise a kind of framework. I talk of wealth, I talk of work and I talk of welfare--three Ws. Each one is a necessary step to the other, for without work--I mean real work that adds value--there can be no worth. Unless wealth is created, at a personal level or collectively, there can be no welfare. So we all know where we are starting from. We can now see in perspective what it means to have 2.5 million-plus people unemployed in this country. It means that the wealth-creating forces are diminished and that the wealth that would be created cannot be distributed in any way, never mind be kept in the wealth creator's pocket. It is lost and we cannot regain it. Conservative Members and, indeed, Opposition Members are concerned that money has been lost through strikes, illnesses and accidents at work, but now we have a deep self-inflicted wound.
For people who are in work, the quality of work has changed beyond recognition. At one end of the spectrum, it is certainly true that there has been massive enrichment of the few, but for the masses the quality of work has diminished. No longer can people with skills which they learnt perhaps in difficult circumstances necessarily transfer those skills to another job. The very technology that engineers, scientists and technicians have created has been used to dispossess those who have the skills of their rightful inheritance. It is paradoxical, but none the less that is the way in which technology has moved in the past 15 or 20 years.
The trade union rights that underpinned people's safety at work have been washed away over the years by legislation. Let me tell Conservative Members, and the world if it wants to listen, that where the economic system is dominated by the simple economics of supply and demand, when the demand for labour increases none of the changes that the Government have made will make a scrap of difference. The employees, the workers, the labour force will reclaim that which they think is theirs. The Government will have made no difference to the way in which the structural part of labour relations is played out in Britain. All that the Government will have done is to apply the cruel market forces of supply and demand, which simply mean that today employers can hold down wages simply by using the single economic tool of unemployment by frightening people that they might be out of work tomorrow. Tomorrow, when those people have jobs, the Government can be sure that their position will start to be redressed. The Government may understand it, but they will live to regret it if they do not.
Much remains to be done to restore a proper balance between unions and their members and employers and their organisations. Only when the scales are balanced and fairness prevails may we expect real progress.
Ministers claim that the number of employed people is rising, and to some extent that is borne out by the facts; but many of those jobs are part time and poorly paid. As for the minimum wage--
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Mr. Peter L. Pike (Burnley): My hon. Friend is about to refer to the minimum wage. Does not low pay equal poor health, poor housing, poor social conditions and poor educational opportunities?Mr. Purchase: My hon. Friend makes an excellent point, with which I shall deal in a moment.
The Conservative party has no right to press Labour to say what the minimum wage should or will be, when it will not say what its minimum wage is. When we ask, "What is the least for which anyone should work?", you have not a word to say. Is it 50p an hour? Is it £1 an hour?
Mr. Deputy Speaker (Sir Geoffrey Lofthouse): Order. The hon. Gentleman must stop blaming the Chair.
Mr. Purchase: I seem not to learn these simple lessons, Mr. Deputy Speaker. I apologise profusely--but, as you know, I am somewhat excitable about matters such as this.
It is incumbent on Conservative Members to tell us the amount for which they believe that people should work. If that amount is nothing, they should say so; if it is 50p an hour, they should tell us that it is 50p an hour. I suspect, however, that they know nothing of these matters, and that they therefore will not rise to the bait. Wealth should be a function of work, adding real value to the goods and services that are provided. In that context, Britain once had a strong economy: we made things, exported things, ensured that the quality of the goods was first class and traded with the world. We held our own. It was not until the Conservatives implemented their policies of the late 1950s that we saw balance of payments problems that the country had not hitherto experienced in peacetime; even then, the Conservatives had begun to forget that, as an island economy--notwithstanding our wider role in Europe and, indeed, the world--we must import certain goods, apply our skills, initiative, innovation and invention and then export those goods at a price greater than that which we originally paid.
That put our balance of payments into perspective, and we got it right: we were paying our way. In 1964, however, a Labour Government inherited a balance of payments deficit of some £400 million. That does not sound a lot, but I think that it would amount to a considerable sum in modern-day money--an amount approximating to the balance of payments problems that we experienced throughout the late 1980s, which were resolved only through the sale of the family silver.
Making money has now become the way in which so-called wealth is created; but it is not real wealth. It is imaginary wealth, because it has no strength or material value. What do I mean by that? Let me give my answer in three ways. At a local level, while small firms struggle to win orders and to fulfil them on the basis of delivery dates, quality and price, thieves and burglars are ripping off the rest of society. In every street in every town, many people are involved in petty thieving of one sort of another, taking away the value that is created by people who go to work. Nationally, white-collar crime is rising inexorably. Scams are reported day and night in our local and national newspapers. At board room level, directors over-reward themselves in an immoral way. People are sitting on each other's remuneration committees, determining who will get what. [Interruption.]
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Mr. Purchase: I beg your pardon?Mr. Pike: People are ripping off pension funds.
Mr. Purchase: Indeed--speak a little louder.
We now know that many pension fund managers are paid on a results basis and are turning over shares, adding to our short-term financial problems just to line their own pockets. Pensioners are often the losers in such matters. Massive pension fund scams have taken place--not least the Maxwell disgrace, with all that that has meant--as a result of which people have tried to make changes, but without much success.
Currency speculators do not care what their activities will do to a nation state. It is simply a matter of pressing buttons--again using the technology created by scientists, engineers and technicians in this country and elsewhere. Their tools are being used against them. Speculators are turning their countries inside out at the press of a button. It is paradoxical. At the same time, they speculate internationally in shares, without a care for whether the company that they speculating for or against will go down the tube, and whether men and women will become unemployed. That is a "make money" society; it is not the "earn" society that Labour Members want to create. It is not about the spivs in the City of London.
On high and low pay, if what Conservative Members were saying about minimum and low pay were true, it is certain that Calcutta and the sweat shops would be a paradise, and that the City of London would be a desert, but we know that the opposite is true because these people speculate and exploit everywhere they go. Respect no longer exists for working men and women who create real wealth in this country. Some people think that large-scale international spivvery should be rewarded. That is not right.
Under the Tory Government, for the first time this century, we have seen the steady--at times almost imperceptible--reversal of the way in which income is distributed in favour of people who have the least. For the first time in a century, that worthy civilised trend has been reversed under this Government.
What does it mean? With so many people out of work, with the social security system under so much pressure, the ideals of Beveridge--for the welfare state to act as a safety net, but always recognising that we would have a society that depended on full employment, however that was defined-- are creaking under the strain. The rich are getting very rich and the poor are getting very poor--such is the society that has been created in Britain today.
The value of benefits has diminished but their total cost has doubled since 1979. What has been the result of the benefits culture? In many cases, people, especially the young, have lost any understanding of the connections between work, wealth and welfare. They believe that, broadly speaking, wealth and welfare drop on the mat in the form of a giro cheque. You have robbed them of their dignity, of their right to work--
Mr. Andrew Mackinlay (Thurrock): The Tories have.
Mr. Purchase: The Conservatives have robbed them. I am sorry, Mr. Deputy Speaker. I know that you are too kind a man to do that. The Conservatives have robbed those people of their dignity and of their understanding of the connections, which are so important for a civilised life in which we can both give and take when that is necessary. Young
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people have borne, and will continue to bear, the brunt of the Government's policies. Inequality is growing every day and it is reaching obscene levels. An elderly woman with disabilities came to my surgery on Saturday. She wants and needs to move from her present council flat to a ground-floor flat. The council are willing to relocate her, but it cannot afford to pay the costs of her furniture removal. She went to social security as she is on income support and was advised that she would have to apply for a loan in order to pay her removal costs.That woman worked for most of her life and her husband paid into pension schemes all his working life. Now, at 70, she is reduced to having to apply for a loan to move house on account of her disabilities. Is that the society that the Conservatives laud in their amendment? They should disown it without further delay because that inequality is unacceptable in a civilised world.
From time to time I like to compare levels of inequality in this country. One could compare the woman to whom I referred with the Queen, the richest woman in the world, who is so rich that she does not know how much money she has.
In the world created by the Conservatives drug dealers earn more money than centre-lathe operators, theft is more valued than earning a living and gambling has been elevated to a grand scale by the national lottery. People now think that their only hope of escape is a win on the lottery--whether it is £1,000 or the figure offered last weekend. Gambling has been institutionalised and the state has become a bookmaker.
My town has an awful reputation for prostitution. Wolverhampton apparently has more prostitutes per capita than any other town in England. Young girls as young as 11 are known to ply their trade in my town. The House condemns sex tourism, but we have it on our doorstep courtesy of a Conservative Government. I could describe the Government--if it is not unparliamentary, Mr. Deputy Speaker--as a state pimp because of the policies that they have introduced and the way in which they have allowed society to rot from the roots up. I do not believe that that is too strong a description of the Conservative Government.
9.17 pm
Mrs. Teresa Gorman (Billericay): I have been allocated the princely total of three minutes in which to devastate the House with the erudition of my remarks.
I entirely support the remarks of my right hon. Friend the Secretary of State, who opened the debate. I believe that he is determined to use taxpayers' money to provide incentives to get people into work rather than use it to pay people for not working. I commend him for that approach.
I am worried, however, when I see the scale and the range of incentives. Every incentive, such as the jobseeker's allowance, back-to-work bonus and all sorts of other benefits to top up earnings, comes out of the taxpayers' pockets and taxpayers on low wages will be less motivated to work to build up their family fortunes. Therefore, I suggest that perhaps it would be better to examine family incomes as a whole and not rise to the Labour party's bait. Labour Members keep grinding on about the necessity of introducing minimum wage laws. I do not wishto rehearse the sensible arguments advanced by
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Conservative Members about why minimum wage laws are a bad idea. It has been mentioned several times that President Clinton is in favour of minimum wage laws. I am not surprised about that because President Clinton is a socialist by our standards. Of course President Clinton commends the concept, but in the United States of America --which has had minimum wage laws for many years--unemployment among unskilled and minority groups in particular has persistently increased relative to employment. Minimum wage laws have removed from employers the cost of their discrimination. If an employer must pay a certain wage regardless, he will tend--for whatever prejudiced reason he may have--to choose the most attractive candidate. Minimum wages always discriminate against the people that Opposition Members wish to help.I invite my right hon. Friend the Secretary of State for Social Security to explore other areas of job creation, particularly those associated with home and family work. Recently, the French have created many new jobs for young and unskilled people in homes whose family members go out to work. In France, if one needs someone to help with domestic duties--such as looking after an elderly relative or small children--one can offset the cost against the family's gross income.
Wages within the family should also be considered. There should be less pressure for every job to achieve a minimum wage starting point. In many households, one wage supplements another. If a woman is prepared to take a part-time job at a relatively low wage--perhaps because it is unskilled--to supplement her family income, that is as valid a reason for working as that of the family's top wage earner. Considering family income as a whole will bring some sanity to our attitudes to wages.
9.21 pm
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