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National Minimum Wage

6. Mr. John Healey (Wentworth): What assessment he has made of the likely impact of the national minimum wage on wage levels from 1 April. [71600]

The Minister of State, Department of Trade and Industry (Mr. Ian McCartney): The introduction of the national minimum wage on 1 April will increase the wage levels of some 2 million low-paid workers throughout the United Kingdom.

Mr. Healey: My hon. Friend referred to 2 million people across the United Kingdom, but is he aware that 77,700 people in South Yorkshire currently earn less than £3.60 an hour? What would he say about the potential benefits of the national minimum wage to the thousands of people in South Yorkshire who, for too long, have been working at the rough end of the labour market?

Mr. McCartney: I thank my hon. Friend for that question. I pay tribute to him for his activities inside and outside the House in defending and promoting the business case as well as the social justice case for the national minimum wage. On 1 April, many workers in his constituency and in the surrounding areas will receive pay rises of about 50 per cent., and following the introduction of the working families tax credit in October, those with

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families could receive in their pay packets the equivalent of a pay rate of £7 an hour. The Government, along with industry, are committed to eradicating low pay and to giving people decent pay and dignity in the workplace.

Mr. Ian Bruce (South Dorset): Will the Minister tell the House what plans the Government have to increase the minimum wage? Companies will have to budget for a minimum wage of £3.60 an hour from 1 April. Should they expect a rise in the minimum wage every year in line with inflation, or is it still the Labour party's intention to increase it to a much higher level in the next few years?

Mr. McCartney: The real issue, which the hon. Gentleman would of course dodge, is whether the Tories will fight the next election on a pledge to cut the minimum wage. The Government will implement the minimum wage on 1 April at the levels set out. I pay tribute to British business, because companies are, of their own volition, implementing the minimum wage in advance, so more than 200,000 workers are already receiving it. Those companies do not want to follow the Tory policy of low pay, no pay. The Government are implementing the minimum wage with the full support of British industry.

Home Shopping

7. Dr. Alan Whitehead (Southampton, Test): If he will assess the impact of home shopping upon the competitiveness of UK retailing. [71602]

The Minister for Competition and Consumer Affairs (Dr. Kim Howells): The retail sector is a dynamic one. I have placed in the Library of the House, for the information of hon. Members, a copy of a recent paper prepared by my Department on the performance of the retail sector, which I hope will be useful. However, it would be very difficult to make the specific assessment requested by my hon. Friend, not least because of the difficulty of obtaining information on the value of electronic trading, which is an increasing and important element of home shopping. I have commissioned research to help to assess the impact of electronic commerce on retailing, and I intend to publish the results before the summer recess.

Dr. Whitehead: I thank my hon. Friend for that answer. My particular concern is with home grocery and household shopping. I have spoken to a number of major retailers with stores in my constituency, and it is apparent that such developments could be either a boon to elderly people in particular or a disaster for all my constituents. Is my hon. Friend aware that various routes to home shopping have been trailed by the major retailers? Is he further aware that the mode that eventually prevails will have profound consequences for competition and customer protection? Is my hon. Friend undertaking activity to ensure that consumers and competition are protected as such developments take place?

Dr. Howells: I welcome the question, because we will all be affected greatly by e-commerce and shopping on the internet in future. It could change social habits; I may not be able to bump into the right hon. Member for Wokingham (Mr. Redwood) in shops in the future, as we

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have done in the past--usually in a panic just before Christmas. Currently, home shopping sales stand at about £9 billion or about 6 per cent. of total retail sales, of which e-commerce comprises only about £100 million. That is calculated to grow by 2002 to about £700 million a year. That will still account for a small percentage of total retail sales, but it is an indication of the way in which the sector will explode in the future. It is right and proper that we should talk to retailers, customers, cities and towns about the implications for the future of shopping in this country.

Competitiveness White Paper

8. Mr. Geraint Davies (Croydon, Central): What assessment he has made of the impact the competitiveness White Paper will have on encouraging an entrepreneurial culture in the UK. [71603]

The Secretary of State for Trade and Industry (Mr. Stephen Byers): The need to foster a culture of enterprise in the United Kingdom was a central theme of the White Paper.

I will shortly publish an implementation plan which will set out how we intend to introduce the various measures contained in that White Paper.

Mr. Davies: Does my right hon. Friend agree that the success of the entrepreneurial renaissance in Britain depends on pupils and students being equipped to make the leap from good ideas to successful products? In this respect, will he applaud the activity of the New Addington education action zone in Croydon in fostering business links and providing mentoring to equip our pupils for the future? Will he commend to the House the provisions of the competitiveness White Paper in linking up our centres of learning to the business community?

Mr. Byers: I am delighted to hear of the success of the New Addington education action zone. In one of my previous Government posts--as Minister for School Standards--I was involved at an early stage in discussions with my hon. Friend about the proposals from that part of his constituency. I am pleased to hear that that zone is progressing well.

A number of proposals within the White Paper will promote a culture of enterprise. I am keen to get away from the poverty of ambition that has held far too many people back for far too long in the UK. I believe that we have positive proposals to ensure that that will no longer be the case. As Secretary of State for Trade and Industry, I look forward to their implementation in the months and years ahead

Mr. Graham Brady (Altrincham and Sale, West): About four weeks ago, the Prime Minister was reported to have said in a speech in Bristol that European Union directives had increased social costs on business by far too much, and that that was damaging competitiveness. Will the Secretary of State list those directives that he and the Prime Minister would like to see removed?

Mr. Byers: We should always review the burden on business, which is one of the reasons why, 10 days ago, we decided to alter the original proposals for the regulations concerning the introduction of the national

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minimum wage. As a result, we have cut the costs of business by £200 million. That was only the beginning, and I am sure that we can take steps in future to help lift the costs from business.

Mr. Harry Barnes (North-East Derbyshire): Is my right hon. Friend aware that all examples of entrepreneurial zip are not necessarily to be welcomed? In connection with the minimum wage, there is some indication that some employers are attempting to decrease hours so that they will not have to meet the increased payments to their work force. Will that matter be examined carefully and reviewed, and will such a review lead to action in future?.

Mr. Byers: The National Minimum Wage Act 1998 has been drawn up in such a way as to limit any opportunities for the type of abuse to which my hon. Friend refers. Clearly, one of the reasons why the Low Pay Commission has been kept in being is to ensure that we can review the Act's workings and operation. If there are specific examples of such abuse, I would urge him, in the first instance anyway, to draw them to the commission's attention.

Mr. John Redwood (Wokingham): How does the Secretary of State have the gall to present a competitiveness White Paper when everything that the Government do makes it dearer to make things in Britain and to do business in Britain? The Minister for Small Firms, Trade and Industry actually called for more regulation in a recent interview in The Birmingham Post.

Will the Secretary of State accept that he is to competitiveness what Lord Sainsbury is to organic farming and Brussels is to the London art market? Does he not agree that the Brussels tax plans will kill London as an art market? I hope that he does not find that amusing. Will he guarantee that he will stop any new tax on the British art market coming from Brussels? Does he agree that such a tax would take the business out of London to New York? Will he give a guarantee--yes or no?

Mr. Byers: The right hon. Gentleman may be slightly confused. The issue that is being debated today in Europe is not a tax, but a royalty for artists. He should be aware of that.

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