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12 Mar 2003 : Column 368—continued

Mr. Caton: I thank my hon. Friend for that intervention. She is sitting next to me and has clearly read my speech, because I was about to point out that the national minimum wage has made a real difference in my constituency. In particular, it has made a real difference to women in my constituency, especially those whose work involves caring for other people, such as the young or the elderly.

The national minimum wage remains a notable achievement, but it has two weaknesses that we should now address: it does not apply to everyone to whom it should apply, and it is not enough. The people who are wrongly excluded from the minimum wage are young workers: 18 to 21-year-olds get a reduced rate, and 16 and 17-year-olds are not covered at all. When the Welsh Affairs Committee undertook its inquiry into social exclusion just over two years ago, we argued that the principle of equal pay for equal work should apply to young people, just as it should to everyone else. The evidence that we received then taught us that some unscrupulous employers would employ workers aged under 18 only to avoid paying the minimum wage. At that time, some were paying as little as £2.00 an hour. We called for the minimum wage regulation to apply to all workers aged over 16, and at the adult rate.

The Committee is conducting an inquiry into the empowerment of children and young people in Wales, and the minimum wage issue has come up both in formal evidence, and in more informal discussions with young people during our visits to Wales. Of course, I cannot predict what our report will say when it is published, but this inquiry gives us a new angle. One reason why we looked into the empowerment question was the concern that so many young people appear to be disengaged from their communities or from wider society—and that includes, of course, democratic politics.

A factor that has already been brought to our attention as a potential contributor to such disengagement is many young people's perception of how they are valued by society. All too often, they feel that they are not listened to, and that their contributions are undervalued in various ways. The message that they get from the current minimum wage rules is that they are

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second-class citizens. Now is the time to make the minimum wage embrace all working people, and to increase it in such a way that it makes a greater contribution to the incomes of the families of low-paid workers.

Compelling evidence for such an increase emerged in December, in the form of research commissioned by Unison from the family budget unit at the university of York, and by the national centre for public policy at the university of Wales, Swansea. I shall not go into too much detail, but the unit has established a methodology to calculate weekly minimum cost needs, taking into account food, clothing, housing, transport and all the other costs involved in maintaining a family at a range of standards of living. At the bottom of the ladder—level 1—is what is called the "low cost but acceptable" standard. The researchers have identified and costed the components of a minimum living standard designed to promote good health and enable lower-paid households to reach their full potential. It is tight, but more than survival standard. It recognises, however, that the income needed to reach that standard will vary according to where people live, as costs vary considerably between different parts of the country.

The study published in December looked at the net incomes required to avoid poverty by one and two-parent families in my home town of Swansea, each with a boy aged 10 and a girl of 14. The incomes needed varied from £252 a week for a lone mum working 17 hours a week, to £310 for a two-earner couple.

The good news is that, with working families tax credit, all the Swansea households with at least one person in full-time work were above that low-cost but acceptable threshold. Although the same was not always true in respect of part-time work, the Government's objective of decent incomes for families with work is in considerable part being met.

The bad news is that the current minimum wage level, and the consequent reliance on working families tax credit, means that the poverty trap is almost inescapable for some families. As long as they are receiving the working families tax credit, the most that such families can gain from every extra pound earned is 31p. Two-parent households in Swansea paying basic rate income tax would need above-average male manual earnings to escape the poverty trap and benefit by 68p for each extra pound earned. The lone mother needs close to three times average female manual earnings.

Unison has translated the £310 minimum needed for a minimum acceptable living standard for the one-earner family with two children into approximately £5.10 per hour. Is that so much?

The Low Pay Commission will report again in the near future. I welcome this afternoon's commitment by my right hon. Friend the Secretary of State to increasing the minimum wage. The figure of £5.10 an hour is the sort of amount that we need to secure to make a real difference to low-paid workers in Wales and across the UK.

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5.17 pm

Mr. Roger Williams (Brecon and Radnorshire): It is a great privilege and honour to take part in this St. David's day debate, even though it has been delayed. Before I make my own comments, I should like to respond to some matters raised by other hon. Members.

The hon. Member for Ceredigion (Mr. Thomas) is no longer in his place, but I am sure that the House listened with great attention to his description of the problems encountered in Ceredigion in ensuring that the planning process is carried out properly and honestly. Before I was elected to the House, I read the report from the Welsh Affairs Committee on rural housing. It dealt with the planning process as well, and made some good recommendations with which I agreed. Although the hon. Gentleman said that the cabinet in Ceredigion unitary authority was led by independents, with Liberal Democrat support, none of the councillors mentioned by him were Liberal Democrats. I am sure that he took great thought before he made his contribution, but I wanted to put that on the record.

The debate has touched on manufacturing industry. There is great concern in Wales about the future of Corus and the huge redundancies that could happen as the company contracts. On a smaller scale, the Llanidloes aluminium casting company, KTH, looks like it is heading towards closure. That will have a huge impact on communities in the area. The company employs so many people in the local work force that its decline is very worrying, as is the fact that so many of the jobs have gone to parts of the EU and enlargement countries that have lower wage costs. That highlights what many hon. Members have said, which is that we need high-skilled, high value-added business to come to Wales. That will ensure that we will not be as vulnerable to such competition as we are now.

Members have spoken of the importance of air transport to Wales. It has been overlooked for a number of years but economic development in Wales would have been much more rapid if it had been available. It will make Wales a much more inviting place to put one's business.

Lembit Öpik: As my hon. Friend says, KTH is closing. Does he agree that there is a great opportunity to invest in mid-Wales to enhance opportunities for air travel at, for example, Welshpool airport, which—I observe wistfully—might be a good venue for British Airways to relocate its operations?

Mr. Williams: The Minister will have noted that and will make representations. A little village outside Llandrindod called Llandegley now has a huge sign saying, "Welcome to Llandegley international airport, terminals one and two." That may be someone's aspiration, which may take more to achieve than my hon. Friend's suggestion about Welshpool.

There has been political merriment today about ambassadors from Wales, but Wales has benefited over the years from an international outlook. We have had a huge amount of international inward investment that has benefited us greatly. Wales has a history of involving itself on the international stage and should not be too shy in encouraging that as we gain long-term benefits.

Mr. Evans: But it is costing £2 million to set up embassies when we already have embassies throughout

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the world; they are called United Kingdom embassies and high commissions. Should not Wales be working through those?

Mr. Williams: If we are to be serious about getting added inward investment into Wales, we have to put serious amounts towards that investment, which will be beneficial in the long run. The payback period will be short.

I want to turn to three issues that affect my constituency, Wales as a whole and the UK in general. The first is the criminal justice system and the importance of individuals having ready access to that system. The rights and privileges of individuals cannot be safeguarded unless they have the opportunity to defend themselves against charges of which they believe themselves to be innocent. I am thinking particularly about victims.

The Government have said that they are putting the rights of victims and witnesses at the heart of the criminal justice system. Yet, in my constituency and rural Wales as a whole, magistrates courts are closing, which makes it difficult for victims or witnesses to get to court without undertaking long and difficult journeys because so little rural public transport is available.

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