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3 Jun 2008 : Column 217WH—continued

[Miss Anne Beggin the Chair]

Also, many people are losing their jobs. One of my constituents, for example, is a man who spent most of his life working in shipbuilding on the River Tyne, earning about £12 an hour as a skilled engineer. Because of a lack of orders, including Government orders, shipbuilding hardly exists now on the River Tyne. My constituent, at 63, is now faced with the reality that he might have to work offshore to make a living wage, because, in his trade as a plumber, he cannot compete with the ridiculously low wages that have appeared in the north-east of England because migrant workers are being exploited by employers. That does not help him or the work force and it does not help our party or the Government.

The workers of this country are concerned about the issue, which is a core issue for Labour party members. It is about why we are here and what we represent. In the real change that has happened in our party and Government in the past few years to become business-friendly, have we forgotten we should also be worker-friendly? If we have, that is a disaster for us, and not only for the people who are the traditional workers, but the millions of new workers who do not understand the history of our party and do not have the relationship with it that they would have had if they had come here many years ago and integrated into the work force as people did over centuries.

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I was sorry to hear in the speech of my hon. Friend the Member for Elmet that the Secretary of State had said effectively that we are at the end of employment legislation in this Parliament. I hope that that is not true, because we need to put resources into making things like the vulnerable worker enforcement forum work. We need to take real action. If we need to legislate to make sure that those things work properly—and it sounds from what has been said today that we do—we should not be frightened to do it. We should do it for the right reasons.

11.59 am

Sarah Teather (Brent, East) (LD): I congratulate the hon. Member for Elmet (Colin Burgon) on securing the debate. He made a very interesting and detailed speech, and it is obviously something that he feels passionate about. It will not surprise him to hear that I am not sure I agree with all of his philosophy. I agree with some of his solutions, but disagree with many.

Not all migrant workers are vulnerable. The CBI’s 2007 employment trends survey shows that demand for skilled and managerial professional workers remains strong. Most firms hiring staff from the new EU member states, for example, expect them to be skilled, so although many migrant workers fall into the category being discussed today, it is important to make it clear that many are highly skilled and do not fall into that class of vulnerable workers. I certainly welcome, however, the focus on vulnerable workers, who are an issue in my constituency, but it is important that we distinguish between those working illegally and those working legally but being exploited. The outcome might be the same, but the solutions are clearly different.

The hon. Member for Elmet quoted the TUC and Lords reports as examples of recent reports discussing this issue. However, another recent report, by the Work Foundation, provided a highly academic analysis of the impact of migration on wages and employment. I recommend that all hon. Members interested in this issue read that report. It reached slightly different conclusions from the House of Lords report and quotes the OECD meta-analysis of all the work done in the developing world and found a very limited impact on employment and wages. Certainly on employment, if anything, the impact was found to be slightly positive, although that is a temporary effect. On wages, it found that the impact was negligible for most countries—the exception being the USA, where there is no effective minimum wage law. That is very important.

The Work Foundation also examined the trends in wages in low-paid employment, particularly in the hotel, catering and construction industries, and found great transience in wages, but the pattern largely followed the trend in minimum wage rises. Wage rises slowed when the increase in the national minimum wage also slowed. The picture is obviously very complicated, and it is difficult to demonstrate an overall effect at the macro level, but that is not to say that there are not local impacts. A number of hon. Members have discussed local impacts in their own constituencies. It is also very clear that there are particular impacts where there is abuse of migrant workers working legally. The hon. Member for Elmet and others spoke about the chances of being inspected for breaching minimum wage legislation—the figures are shocking—and about other abuses of existing legislation. The question is: how do
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we deal with that? There is always a temptation to legislate further, which has been part of the debate so far. I agree with the hon. Member for Buckingham (John Bercow) when he said that there is a tendency to instinctively legislate, but we can enforce existing legislation. There is no point in creating new legislation if we cannot enforce existing practices.

I welcome the agreement between the CBI, the TUC and the Government on temporary agency workers. I look forward to seeing the details, however, because it is difficult to see from this vantage-point exactly what we are dealing with without knowing the detail of the behind-the-scenes discussions. We will certainly look at that when legislation is published, later this year, I assume. However, I am concerned that the rights of many people already working legally for an agency for more than three months are not enforced, and I question whether tightening up the legislation will necessarily yield our desired outcome. New legislation will not necessarily create a change in practice. The priorities must be a change in the levels of information and enforcement.

John Bercow: The hon. Lady is right to remind us, as I sought to do, of that which exists but is inadequately enforced. On the subject, to which much reference was made, of media hype and scaremongering, would she agree that whatever the claims of the media, it would be extremely unwise and entirely arbitrary simply to impose a national limit on the number of migrants admitted to the country on, for example, an annual basis? It would very likely be wrong, and there is no good cause for it.

Sarah Teather: I completely agree. Immigration—in particular with respect to work gaps—must depend on the gaps in the market. I can see us imposing an arbitrary limit and then finding that Chelsea want a new footballer for their team—when we have already had the quota of immigrants for that year. What on earth would we do then? I am sure that there would be an outcry from the very same papers that said there should be a quota.

Colin Burgon: Not from Leeds fans.

Sarah Teather: But not from Leeds fans. I am sure that that is very true.

On enforcement, will the Minister comment on Citizens Advice recommendations for an enforcement commission to consider other areas that legislation covers in practice, but where it is difficult for people to exert their rights because of a lack of information and of a practical system?

Jeremy Corbyn: Does the hon. Lady also agree that it is important for public and local authorities and Government agencies to ensure that everyone whom they employ is at least on the minimum wage and properly employed, rather than turn a blind eye to it and accept the lowest possible bid in this contract-culture era that we are in?

Sarah Teather: I absolutely agree. The hon. Gentleman makes a sensible point.

I shall move on to the issue of illegal workers, which the hon. Members for Dagenham (Jon Cruddas) and
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for Islington, North (Jeremy Corbyn) spoke about extensively. I feel particularly strongly about it because I see it in my constituency. If there is an impact on the low-paid, that is where it comes from, because illegal workers are neither covered by minimum wage legislation nor protected by employment legislation. One only has to take an unlicensed minicab in London and have a conversation with the driver to understand that we have the most over-qualified minicab drivers in the world. The number of people I have spoken to who are doctors or professors in their home country but who in this country are forced to drive minicabs illegally is particularly shocking.

In my constituency, on Chichele road, whenever the media are looking for a story about illegal casual labour, they tend to film the number of casual labourers waiting, sitting on walls outside people’s homes from dawn each day. Some of them are legal and just looking for casual labour, but many are not, and as successive waves of immigrants have been unable to regularise their status, we have seen the change in the nature of those people sitting on that wall on Chichele road. It is a tragic situation and those people are very vulnerable.

The Government’s own estimate is that there may be as many as 600,000 irregular migrants in the UK. Many of them are working illegally. Several hon. Members talked about the churches’ campaign, “Strangers into Citizens”, which is a very good and interesting campaign. It is good to have a coalition of people campaigning on behalf of vulnerable people who are often overlooked. We really must face the facts about that group of people: we simply cannot deport all the people who are here illegally. It costs about £11,000 for each deportation, and I have seen a number of shocking examples of botched deportations, when people should have been sent home but the Government have been unable to manage it. No way are we going to deport them all, so the Government should concentrate on those who are criminals and make no contribution to the UK, ensuring that we bring the others out of the shadows so that they have an opportunity to integrate. They should be paying tax in this country.

If one has been in the UK for 10 years, has not committed a criminal offence and can speak English, one should be eligible for a two-year work permit, which should be the beginning of an earned route to citizenship. We should ask people to demonstrate their long-term commitment to the UK, enable them to do it and fast-track them on to indefinite leave to remain.

Complementarity is the argument used by employers for the need to recruit workers from overseas. Everybody says that it is a short-term solution to the lack of skills in this country, but we are not doing anything to ensure that we aim that work at areas where there are skills shortages. I would like the Government to consider the possibility of increasing the cost of those work permits but ring-fencing the money to be used in targeted areas to increase skills, particularly where there are shortages in the economy. That interesting solution might meet many people’s concerns.

12.10 pm

Mr. Jonathan Djanogly (Huntingdon) (Con): The hon. Member for Elmet (Colin Burgon) raises an important subject today, about which he spoke strongly.

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The protection of migrant workers is, of course, important. I am sure that all hon. Members in the Chamber today want to do everything in their power to put an end to the exploitation of certain sectors of the migrant work force and to prevent a rerun of the Morecambe bay tragedy. I agree with the hon. Member for Dagenham (Jon Cruddas) that the issue needs to be looked at in a broader context, as it raises important questions about the control of immigration and dealing with poverty. I would add to that list, although the hon. Gentleman might not, the environment that we have created for employers—namely, the job creators.

What should not be a factor is xenophobia, as was strongly suggested by the hon. Member for Islington, North (Jeremy Corbyn). Given that unemployment has risen for the last three months in a row and is predicted to rise increasingly over the next year, I agree that the subject needs to be analysed carefully. The challenge is to deliver action to prevent the exploitation of migrant workers without putting further strain on our already overburdened businesses.

We should certainly be looking to improve conditions for migrant workers by the better policing of existing legislation. Rights already exist, such as those in anti-discrimination law, health and safety legislation and employment and tax law, to protect vulnerable workers. It is important that Departments in charge of administering those areas work together efficiently and effectively to enforce those laws to achieve the intended effect. As the TUC recently argued, it is also important that employees are made aware of their employment rights. The trade unions are in a strong position to increase such awareness among workers, and their contribution is recognised in the recent report of the TUC’s commission on vulnerable employment. Indeed, I and my hon. Friend the Member for Rutland and Melton (Alan Duncan), the shadow Secretary of State, were pleased to have contributed to that report. One area where the law needs to be more strictly enforced is on the operation of gangmasters. They can fulfil an important role in providing flexible short-term labour, but there is much evidence of illegal gangmasters breaking the law in various ways.

As my hon. Friend the Member for Buckingham (John Bercow) said—it was also argued by the hon. Members for Elmet and for Brent, East (Sarah Teather)—there is little point in having tough legislation if it is not adequately enforced. That, I would add, is despite the fact that such a failing is a hallmark of the Government’s administration across the board.

The Conservative party supports the proper monitoring of the legislative provisions that relate to the payment of the minimum wage. It is currently estimated that 292,000 workers are being paid less than the minimum wage. I shall be joining the Government in speaking on behalf of workers who need to be protected from such exploitation when we debate the topic in more detail in the forthcoming Employment Bill, which is now wending its way through the other place. However, it must be appreciated that there is much conflicting opinion on the effect that immigration has had on wages.

I agree with the hon. Member for Brent, East that not all immigrants are poor, but today’s debate is about those who are poor, and I speak in that context. The House of Lords Economic Affairs Committee examined
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the issue and found, as various hon. Members said, that although immigration has had a positive effect on the wages of better-paid workers it has had a negative impact on those on lower pay.

John Bercow: I am extremely grateful to my hon. Friend for giving way. One can argue the toss—there is scope for different theses—about the impact of immigration on national income and whether or not it has made the country richer. I think, on the whole, that it has. Would my hon. Friend nevertheless agree that it is critically important to recognise, against the manic rantings of the red-top tabloids, that the evidence clearly shows that immigrants contribute more to the national cake than they take from it?

Mr. Djanogly: I agree that immigrants have contributed a lot to this nation, but whether every immigrant contributes more or less to the national cake is something that has to be considered on an individual basis. I am arguing that when it comes to pay, the evidence is definitely at odds. The 2008 report of the Low Pay Commission, which investigated the influx of migrant workers to Britain, was more on the lines set out by the hon. Member for Islington, North, noting that

That is more like the argument proposed by my hon. Friend the Member for Buckingham. The evidence, however, is not conclusive. The report also dispelled the idea that migrant workers are routinely paid less than the minimum wage. It said that

It is important that we make that point. The effect of immigration on wages in the UK is uncertain. While that remains the case, we need to be wary about introducing new legislation that will distort market flexibility in a difficult economy.

Jeremy Corbyn: On the hon. Gentleman’s point about the importance of the national minimum wage, will he support me in welcoming the London living wage introduced by the former Mayor? Will he assure the House that the current Mayor of London will continue that humane and decent policy of ensuring that the reality of high costs in London are recognised in payment?

Mr. Djanogly: The general point is that there is a case to be made that the public sector should have a say on a voluntary basis in setting standards. That is generally to be encouraged.

Jeremy Corbyn: What is the answer?

Mr. Djanogly: It is not for me to give the hon. Gentleman an answer. He needs to ask the Mayor.

We now have an economic climate in which employers often have to employ migrant workers because they find it too expensive to employ British people. The hon. Member for Elmet said that the Government strategy affected the lower paid. However, the proposed agency workers legislation—the Minister might want to put me right on this—will not only capture the low paid. Between 1991 and 2006, a net 2.3 million immigrants arrived in
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Britain. In 2006 alone, 130,000 non-EU nationals were granted settlement. That represents a significant strain on our country’s infrastructure. Whether such an influx is for good or bad may vary in different cases. The Conservative party has proposed that there should be an annual limit on immigration with admission based on the benefit to the wider economy.

Protecting migrant workers from exploitation is important. However, that is only part of the story if we are to tackle the underlying reasons for the need for such workers in the first place. The Conservative party proposes not only to cap non-EU immigration and bring in a more effective border police, but to look at ways to get the 1.61 million British people who are currently unemployed back into work—not least through welfare reform. We also propose providing the means to reintegrate into society the 25,000 under-18s who are currently not in education, employment or training. We would also make it easier and more attractive for businesses to take on employees. As the economy worsens and unemployment rises and wages are eroded by inflation, action needs to be taken to encourage employment, yet the Labour party is proposing further changes to employment law that will make employing staff an even greater burden for business. For example, the Government recently increased the rights of temporary and agency workers, and that is before the next round of the Warwick agreement. Labour, therefore, has adopted a very damaging attitude towards business.

Increasing working rights may be acceptable, but it will mean that more businesses will have to employ temporary workers to cover shortfalls. However, the recent beer and sandwiches deal means that employing such temporary workers, many of whom will be immigrants, will now be more expensive and burdensome for businesses. The unions may think that by demanding tougher monitoring of immigrant labour, it is less likely that companies will employ immigrants. The hon. Member for Elmet called the current position unacceptable, but that is too simplistic. Put in a wider context, more businesses are likely to be priced out of employing workers legitimately and may even be pushed into employing illegal immigrants.

To conclude on what we agree is a complicated issue, the protection of migrant workers is important for the Conservative party. Although a general legislative framework exists to tackle the problem, more should be done to improve policing in this area.

12.20 pm

The Minister for Employment Relations and Postal Affairs (Mr. Pat McFadden): As is customary, I begin by congratulating my hon. Friend the Member for Elmet (Colin Burgon) on securing the debate. He spoke with great thoroughness about a difficult set of issues. He began by saying that there was a basic consensus between the two Front Bench spokesmen on these issues. I am not sure whether he still holds that view, having heard the contribution of the hon. Member for Huntingdon (Mr. Djanogly). However, that is for him to decide.

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