Scottish Grand Committee
Wednesday 10 July 2002
[Miss Anne Begg in the Chair]
The Secretary of State for Scotland (Mrs. Helen Liddell): I beg to move, That the Committee do now adjourn.
I take this opportunity, Miss Begg, to welcome you to the Chair. This is the first time that we have seen you in the Chair. It is a particular pleasure for me and for my hon. Friend the Under-Secretary to see someone who has been so active in this Committee taking the Chair. I hope that you will not have to intervene too often to keep us all in order. It is a privilege to see you in the Chair today.
I also take the opportunity to point out that today is the birthday of the hon. Member for Galloway and Upper Nithsdale (Mr. Duncan). Some of us will never see 37 again; I am quite jealous, bearing in mind his lowly status as a Conservative in Scotland—[Interruption.] It seems that our debate is so interesting that members of other Committees are seeking to join us.
We are here today to talk about social inclusion. Whenever we reflect on the purpose of being in Government, we realise that it is a quest for social justice. We do not seek to govern for the sake of it but because we genuinely want to bring about change, especially for the most vulnerable in society. I have no doubt that today's debate will be about statistics and policy options, but underpinning that debate will be the values that inform our work.
We have started the job of making a difference, but we have not finished it. The Government are committed to halving child poverty by 2010 and to abolishing it within a generation. One of the key steps that we have taken to promote social justice in Scotland is the establishment of a Scottish Parliament; devolution allows local matters to be handled in a sensitive and distinctive way. Its partnership with the United Kingdom Government means that Scots benefit from the macro decisions that put more money into the pockets of those who most need it.
On social justice, as in other matters, the Government work in close partnership with the Scottish Executive. We have built a sound economy because that goes hand in hand with social justice, and that is exactly what we are achieving. We have provided the resources and reformed key public services in Scotland in order to help managers and staff to promote social justice and make a positive difference to society.
One of our first moves as a Government was to change the nature of public services in Scotland. We introduced the new deal, which involved reforming the Employment Service. The new deal allows staff to
Column Number: 004
treat people as individuals. Personal advisers have been allowed to do their job of providing professional and caring advice; and all of us, as constituency Members, come into contact with the changes that have been brought about in people's well being.
We should pay tribute to those who have helped people with considerable difficulties make that important jump into employment. More than 76,000 people in Scotland have found jobs through the new deal. It has made a difference to many lives. It has helped 42,000 young people, 16,000 lone parents and 8,000 people over 50 into employment; and 10,000 people have been helped through new deal 25-plus. That was a considerable achievement for the Government and their advisers, and it helped people into work, even though many of them had lost confidence.
The new deal will continue to work in Scotland, because the Government work together with the Scottish Executive, employers and individuals. We work with the private sector because social justice goes hand in hand with successful business, and I pay tribute to it for its participation in the new deal. The voluntary sector has also participated, and more than 500 voluntary bodies offer new deal placements, which is a great tribute to the sector's vitality. Last week, Cathy Jamieson—the Minister with responsibility for these issues—and I met voluntary sector representatives, and we discussed how important the new deal was to them. As regards participation in the new deal, my only criticism is of the public sector, which could learn much from the involvement of the private and voluntary sectors.
Thanks to schemes such as the new deal, we now have record levels of employment in Scotland. The claimant-count unemployment rate is 4.1 per cent.—the lowest level for 25 years. The number of people in employment is 2,378,000—the highest level for a generation. Youth and long-term unemployment have been slashed by more than 70 per cent. since 1987. Those developments are transforming people's lives, giving them hope and making a difference.
Our employment reforms have made work pay. The national minimum wage helps about 110,000 people in Scotland. I remember the debates that took place before we came into government about whether we would introduce the minimum wage. We have now shown the strength of our commitment by introducing it, and we have faced down those who said that it would destroy jobs. It is important to note that many more people are in employment now that we have the minimum wage. We have delivered on our commitment, and it has not destroyed jobs—far from it.
Annabelle Ewing (Perth): Will the Secretary of State give way?
Mrs. Liddell: I shall give way in a minute.
The minimum wage is being enforced. In Scotland alone, during the past three years, the Inland Revenue has identified more than £600,000 in wage arrears owed to low-paid workers. When the hon. Lady intervenes, perhaps she will explain how it feels to be a
Column Number: 005
member of a party that could not even be bothered to turn up to vote on the national minimum wage.
Annabelle Ewing: I thank the Secretary of State, but we have heard all that before. I should like to ask her what plans the UK Government have to end the age discrimination inherent in the minimum wage scheme.
Mrs. Liddell: I notice that the hon. Lady did not respond. She is undoubtedly embarrassed, as any sensible person would be, by the fact that her colleagues stayed in bed rather than voting the national minimum wage on to the statute book.
Our advice from the Low Pay Commission was aimed at ensuring that we struck a balance between the national minimum wage and getting people into employment. The surest way to get people out of poverty is to get them into employment, and those of us who have worked for years to create more jobs in Scotland recognise how important that is. Reducing youth unemployment has been one of our most significant achievements.
If we are to encourage people into work, we must ensure that it is allowed to pay. We have all seen the consequences of the poverty trap, which dissuaded people from going into employment, because they would end up poorer. The introduction of the working families tax credit benefits more than 122,000 people in Scotland. That money goes directly into their pay packets, and makes a difference for some of the lower paid in society.
Mr. Peter Duncan (Galloway and Upper Nithsdale): Will the Secretary of State give way?
Mrs. Liddell: I shall certainly give way, because I am in a challenging mood. Perhaps the hon. Gentleman will tell the Committee how he can justify taking part in a debate on social inclusion when his party's leader said that he would not match Labour's spending plans.
Mr. Duncan: I am only too happy to recognise the Secretary of State's ability to read The Daily Telegraph so early in the morning. Is the answer to the poverty trap more or less means-testing?
Mrs. Liddell: The answer to the poverty trap is to get people into jobs and to ensure that resources are directed at those who are most vulnerable. My right hon. and hon. Friends have said, day in and day out, that assistance has to be targeted.
Sir Robert Smith (West Aberdeenshire and Kincardine): Will the Secretary of State give way?
Mrs. Liddell: I want to continue with the point before I give way to the hon. Gentleman.
As well as the working families tax credit, we have also introduced the children's tax credit, which pays up to £10.17 a week for up to 400,000 families in Scotland. From April, that increased to £20.17 a week for families in the year of a child's birth, when the money is most needed.
Sir Robert Smith: The Government are providing support through targeted benefits. Does the Secretary of State recognise that that means that many more people come into contact with paperwork and form filling in order to claim? Things can go wrong, so it is
Column Number: 006
important that the voluntary advice sector is well funded and resourced. Does she think that that the Department for Work and Pensions should put some of its resources into the independent sector, to ensure that people can seek advice to ensure that they claim the right benefits?
Mrs. Liddell: Various routes help to fund voluntary organisations so that they can give advice. One of the most important sources of advice for many people is Members of Parliament. I do not know about the hon. Gentleman's surgeries, but mine are full of people who come to ask about benefits and targeted benefits. It is important to ensure that MPs, as well as people in the voluntary sector, are sufficiently experienced and skilled to give the necessary advice.
I pay tribute to the officials in the Department for Work and Pensions who have set up seminars in the House to help colleagues give such advice to their constituents. [Interruption.] I hear hon. Members mocking the idea of those seminars. Some people in the House think that they know it all anyway, but I have never shared that mindset.
The working families tax credit and the childrens tax credit have directly attacked family poverty, especially child poverty. However, we want to do an awful lot more. Next year, we will reform the tax credit system to improve and simplify it. We will introduce the working tax credit, so that those without children can benefit. The new child tax credit will mean that for the first child, child benefit and the child tax credit will provide £54.25 a week to all families with incomes of less than £13,000 a year.
Alongside that, we have improved statutory maternity leave and pay, and we will introduce paid paternity leave and adoption leave from next April. The sure start maternity grant has gone up to £500 from April, which is a huge boon for any family with a new child, especially poor families. Families are at the heart of our approach, for which we do not apologise.
As a result of our changes to personal tax and benefit reforms since 1997, by April next year families with children will be on average £1,200 a year better off. Those in the poorest fifth of the population will be on average more than £2,400 a year better off in real terms. A single-earner family with two young children on half of average earnings will be £3,490 a year better off in real terms. A single-earner family on average earnings with two children will be £310 a year better off in real terms. Those figures show that we have made a difference. We have helped families with children, and shown our commitment to the poorest in our society.
But the problems of poverty in Scotland have not disappeared. It will be a long haul to tackle all the problems, but we have started the job. We recognise that there is much more to do, and in partnership with the Scottish Executive we are determined to finish it. The work is not only about statistics. It is about individuals and their families who will benefit from initiatives such as the new deal and the working families tax credit.
Social justice does not simply sit in a box labelled policy initiatives. It is about being prepared to act to
Column Number: 007
counter manifest unfairness. Asbestos victims and their families were at the heart of an initiative that had to be taken in relation to Chester Street, formerly known as Iron Trades, the insurance company that specialised in industries, such as shipbuilding, that involved high levels of asbestos. When it became insolvent last year, there was a risk that asbestos claimants could lose out. That was a particular concern in Scotland, given our asbestos legacy from the past. The Government acted. We brought together the key players to make progress on compensation, and we have gone a long way to resolving the sticking points.