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National Minimum Wage

3. Mr. David Anderson (Blaydon) (Lab): What assessment he has made of the impact of the national minimum wage since its introduction; and if he will make a statement. [60673]

8. Mr. Russell Brown (Dumfries and Galloway) (Lab): What assessment he has made of the impact of the national minimum wage since its introduction; and if he will make a statement. [60678]

The Secretary of State for Trade and Industry (Alan Johnson): The minimum wage has made a real difference to around 1 million low-paid workers each year, particularly women, who make up two thirds of those benefiting. The latest increases, which we announced on Monday, will benefit 1.3 million workers from October 2006. The adult rate will increase by 6 per cent. to £5.35 per hour.

Mr. Anderson: I welcome this news from my right hon. Friend. As someone who originally gave oral evidence to the Low Pay Commission, I am filled with pride at what my party has done. When I recently visited Israel, its Labour party asked me whether we could inform it of our progress with the national minimum wage, because it wants to use our success as a model for Israel. Will my right hon. Friend help me to provide that information?

Alan Johnson: I certainly can help my hon. Friend. A number of countries are interested in our experience, and it has to be recognised that when we proposed the national minimum wage, there were predictions of doom and gloom not just from the Conservatives, but from the Liberal Democrats, who advocated a regional minimum wage. Incidentally, as recently as 2003, they were saying, in the person of the hon. Member for Twickenham (Dr. Cable), that

"Making a commitment to a two-year deal, at levels significantly above inflation and at nearly double the current level of average earnings growth, sets a dangerous precedent at a time of almost unparalleled uncertainty".

Now, all the parties agree with the national minimum wage, but every time that we propose increasing it, we once again get these doom-mongers. The way in which the Low Pay Commission has approached the national minimum wage has led to its success—one that countries such as Israel wish to replicate.

Mr. Brown: As someone who served on the Committee that considered the National Minimum Wage Bill, I am delighted with the progress that we have made in recent years. My area was badly affected by low pay, and the regional variation proposed by the Liberal Democrats would have done no good whatsoever. I do have anxieties, however, about unscrupulous employers. How many telephone calls have been made
 
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to the Government's helpline to report unscrupulous bosses, and how many prosecutions have come off the back of those calls?

Alan Johnson: My hon. Friend raises an important point about enforcement. I do not know off the top of my head the number of such telephone calls, but I do know that the vast majority of employers are complying with the national minimum wage. There is, however, an irresponsible minority, and since the introduction of the national minimum wage, there have been 38,000 investigations identifying more than £22 million in minimum wage arrears. My hon. Friend the Minister for Employment Relations, Consumers and Fair Markets announced last year a new concept of targeted enforcement, whereby we examine those sectors of the economy that our evidence suggests there is a particular problem with. So enforcement is very important, but the encouraging news is that, as I said, the vast majority of employers happily comply with the national minimum wage.

Miss Anne McIntosh (Vale of York) (Con): Does the Secretary of State accept that, in his obsession with the minimum wage, he has taken his eye off other low pay issues? Why are women in the civil service earning 25 per cent. less than men?

Alan Johnson: May I gently chide the hon. Lady? We are not obsessed with the national minimum wage, which is important in tackling the very issue that she raises. As I said, two thirds of those benefiting from the increase in the minimum wage will be women. Since its introduction, that gap to which she refers has closed—by some 4 per cent.—but not by nearly enough.

My right hon. Friend the Chancellor made several important announcements yesterday, including measures to double the number of skills coaches, which was a specific recommendation by the women and work commission; to use the national employer training programme, train to gain, to focus on low skilled women; and to spend £20 million in doing so. A number of other measures will be taken in accordance with other recommendations.

The hon. Lady is a very decent Member of Parliament—[Hon. Members: "Hear, hear."] I am in that kind of mood today. However, she should stop attacking the national minimum wage, which is what she was trying to do in calling it an obsession, and celebrate it and the contribution that it is making to low pay in this country.

Renewable Energy

4. Mr. Graham Allen (Nottingham, North) (Lab): What measures his Department is taking to ensure that the UK meets its target of 10 per cent. of energy being generated from renewable sources by 2010; and if he will make a statement. [60674]

The Secretary of State for Trade and Industry (Alan Johnson): In 2003, the Government established the renewals obligation to support renewable generating capacity to help us to meet a target of 10 per cent. of electricity generated from renewables by 2010. In addition, we have invested £500 million in capital grants
 
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between 2002 and 2008 to encourage research and development and installation of renewables and low-carbon technologies. We are making good progress with more renewable generation in the UK than ever before, but in order for us to go even further the energy review will look at the potential role of a variety of low-carbon technologies, including renewables, in helping the UK meet its medium and long-term energy policy goals.

Mr. Allen: Sweden is working towards an oil-free energy policy over the next 15 years, which incidentally will not require any nuclear power stations. My right hon. Friend will know that that topic has potential for immense social division in this country. Will he close the options down when we get to the conclusions of the review and, when the decisions are made this summer, will he take great pains to build a national consensus on the issue so that we may all go forward together?

Alan Johnson: My hon. Friend makes an important point about the experiences of other countries. In the energy review we will look closely at Sweden, and at Finland and other countries that have come up with different solutions. We would very much like to build a consensus. The first part of that is to have a proper review, based on all the evidence available, and then to publish the results, which will determine the future of nuclear energy in this country and will also be focused on other areas, such as renewables and technologies such as carbon capture and storage. We will seek to reach a consensus, not least because those are long-term issues and there needs to be certainty for business that we will carry on in the same direction over the years to come.

Adam Price (Carmarthen, East and Dinefwr) (PC): The Carbon Trust has estimated that up to 20 per cent. of the UK's energy needs could come from marine energy sources. Can the Secretary of State explain therefore why so many tidal power projects have been rejected by the Department, and in particular the Swansea bay tidal lagoon project, which the Department has condemned out of hand as prohibitively expensive?

Alan Johnson: I do not accept that we have not supported wind and tidal power. There has been a focus on wind, both offshore and onshore, but the technologies for both are more at the drawing board stage, compared with some of the others. We have announced a £50 million contribution to wave and wind power, and the marine Bill, to be introduced by the Department for Environment, Food and Rural Affairs, will tackle some of the planning issues that have emerged. I do not accept the criticism that the hon. Gentleman makes, but I do accept his point that wind and wave power is a crucial aspect of our energy future.

Mark Lazarowicz (Edinburgh, North and Leith) (Lab/Co-op): My right hon. Friend will know that a debate is taking place at European level about whether the EU target for renewables should increase to 15 per cent. by 2015. Can he assure the House that the British Government are actively seeking that higher EU target and will they press for an even higher target in the future?
 
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Alan Johnson: That would cause us no problem whatever, given that our aspiration is to reach 20 per cent. in the UK by 2020. Because businesses need to see the long-term future of their investments, the further away we can set realistic targets the better. I congratulate my hon. Friend on his private Member's Bill, which will make a significant contribution to that whole area of renewable energy, if we can remove the blockage from the Opposition.

Hon. Members: Where is he?

Mr. David Heath (Somerton and Frome) (LD): The Budget announcement yesterday is good news for microgeneration. Does the Secretary of State accept that there are three issues relating to microgeneration? The first is to encourage research and production, the second to make it economically viable for the consumer, but the third is to remove the obstacles of regulation, whether through licensing or planning, that prevent people from installing sensible microgeneration schemes. Can he do something about that?

Alan Johnson: The hon. Gentleman mentioned three obstacles and I agree with him, but he could have added a fourth—the right hon. Member for Bromley and Chislehurst (Mr. Forth).

Next Wednesday, we shall be publishing our strategy on microgeneration, which will include the very issues that the hon. Gentleman raises, especially about renewables. I agree that yesterday we heard good news: another £50 million on microgeneration, with the £30 million already provided, really puts serious money behind that important aspect of our energy policy.

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