Business, Innovation and Skills CommitteeWritten evidence submitted by WEN Wales

WEN Wales is a community of organisations and individuals working to advance the rights of women in all spheres of Welsh life. We want to create a fairer society in which women live free from sexism and gender discrimination and enjoy equality in all aspects of their daily lives. The role of WENWales is to facilitate communication between our members; to help them coordinate their work and work in partnership and to represent women’s interests at all levels of government. We welcome the opportunity to respond to this consultation. Women account for approximately half of the population and the workforce. Despite succeeding in education, women are over-represented in low paid jobs, mostly in order to balance work and care. We hope that this consultation will lead to changes in the workplace that will support the full use of women’s skills in the economy.

Consultation response

1. Do the Gender Equality Duty and the Equality Act go far enough in tackling inequalities, such as gender pay gap and job segregation, between men and women in the workplace?

1.1 Legislation alone will not resolve these issues. We have had an Equal Pay Act in the UK for 40 years and the pay gap still prevails. Achieving the change we need depends on social actors such as parents, community leaders, education practitioners, careers advisers, employers, voluntary organisations and more. The Government has the power to make sure all of these agencies and individuals are aware of the issues and are taking the steps necessary to bring about the change we need.

1.2 The Public Sector continues to be the major employer of women in the UK. Many Local Authorities have still not settled equal pay claims from their women employees. Under equal pay legislation, councils were supposed to settle claims by April 2007. Most in Wales have yet to settle.

1.3 Job segregation remains in place, exacerbated by a lack of appreciation of the potential productivity gains made possible by the creation of a gender balanced workforce at all levels in the organisation. Management development programmes need to include information on best practice in application of the gender equality duty.

2. What steps should be taken to provide greater transparency on pay and other issues, such as workforce composition?

2.1 When they are published, equal pay audits provide a useful means of improving transparency, allowing analysis of systems especially if they were combined with mandatory obligations to implement findings. Stakeholders could then play a role in holding directors and management accountable for lack of progress on equal pay.

2.2 By encouraging dissemination of information on the gender composition of organisations; this could be a requirement for publication in the annual reports of government departments and in statutory returns to Companies House Comparative tables could be published every one or two years to measure progress towards a gender balanced workforce.

3. What has been the impact of the current economic crisis on female employment and wage levels?

3.1 The economic crisis has hit women’s jobs and the particular sectors where the majority of women find work, such as public services and retail. There has been an increase in part-time working but this is due to many employers offering reduced hours. Research shows that in Wales, 50% of part-time jobs are low paid and one in 10 workers is under-employed, with many working part-time hours but wanting more. Women are often found to be working in the lower paid jobs such as cleaning and catering.

3.2 20% of women are low-paid compared with 10% of men. Women are 80% of claimants of Income Support in Wales, mainly because they account for the majority of lone parents.

3.3 IFS1 estimate that on average:

Lone parents (90% of whom are women) will lose more than 12% of their income by 2014–15—equivalent to about £2,100.

Workless couples with children will also lose 11–12% of their income.

Families with children under five and families with more than two children are the worst affected of all.

These are very substantial decreases in projected household income, affecting people who already have very limited means.

3.4 The new Universal Credit will be paid only to one member of the household (although Child Benefit and Carer’s Allowance will continue to be paid to the claimant). So, even if the household’s benefit claim is made up of entitlement by several members of the household, only one person will actually get the money (and this will be paid monthly).

3.5 Studies of how families manage their money suggest that women often don’t have equal access to family cash and are likely to bear the brunt of shortfalls in income, all the more so with a switch to monthly rather than fortnightly payments.

3.6 And then there’s the question of second earners. Universal Credit has been explicitly designed to encourage one-earner households: “incentives for first earners have been given priority over second earners […] the aim of Universal Credit is to ensure that as many households as possible have at least someone in work and that work will pay for that household.”2

Couple this with the squeeze on women’s employment in the economy generally and the reduction in support for childcare costs, and there is little incentive for a second earner to work. The Resolution Foundation has shown that a second earner in a family who is working 16 hours a week on the minimum wage would, on Universal Credit, take home £17 a week after childcare costs—around £1 an hour—compared with £46 a week under the current system.

3.7 Changes proposed in the Chancellor’s Autumn Statement will hit women harder than ever. New analysis has shown that 81% of the key additional direct tax, tax credit and benefit changes will come from women—that is, £867 million of the £1.065 billion raised.3 As a result of these changes, working parents will see child tax credits and child benefit cut in real terms on top of the previously announced real cuts in Working Tax Credits and childcare. Maternity pay is also being reduced, removing £180 from of the pockets of new mums by 2015–16, making it harder for women to afford to take their full maternity leave. Changes since the 2010 election now mean women are paying three times as much as men to bring the deficit down, even though women still earn less and own less than men. Things like the increase in public sector pension contributions, cuts to attendance allowance and social care hit women harder too. House of Commons Library research shows that out of the total £16 billion being raised in direct tax, credit, benefit, pay and pension changes, £12 billion is being paid by women.

4. How should the gender stereotyping prevalent in particular occupations be tackled? For example, in engineering, banking, construction and the beauty industry

4.1 There is a widely recognised need to promote gender equality in schools and communities. The media plays a major role in reinforcing gender stereotypes. Chwarae Teg’s Agile Nation project is working to reduce gender stereotyping in schools through the Fair Foundations programme: http://www.agilenation.co.uk/for-educators/. Agile Nation’s educators strand also works with Sector Skills Councils to engage girls in non-traditional apprenticeships such as construction and ICT. Women are severely under-represented in the sectors predicted to grow in the future such as Aerospace, Advanced Manufacturing and Energy. This means that they are not able to contribute to or benefit from economic growth. The persistence of occupational stereotyping causes women to remain in typically female sectors which are being worst hit by public cuts.

5. What more should be done to promote part-time work at all levels of the workplace and to ensure that both women and men have opportunities to gain senior positions within an organisation while working part-time?

5.1 Part-time work is not always a good thing. Many people in Wales are currently under-employed in part-time roles because they cannot get more hours. Chwarae Teg promotes flexible working in order for carers to balance work and family life. Chwarae Teg research (yet to be published) tells us that women prioritise work-life balance and will accept low-paid, part-time jobs to achieve it. Businesses need to make sure they have “family friendly” policies in place which allow women to work flexibly in roles that allow them to reach their potential. Women’s qualification levels have been rising; women account for around 2/3 of graduates and yet this valuable resource is not being used in the economy. Flexible working opportunities, particularly in senior roles, would support women to reach their potential.

6. To what extent have the recommendations in Lord Mervyn Davies’ Report “Women on Boards” (published in February 2011) been acted upon?

6.1 Lord Davies’ report set a target of 25% women on FTSE 100 boards by 2015. The one year progress report showed a 3% increase. Chwarae Teg stakeholders say that it has motivated companies to develop programmes to support women to progress to this level. WEN Wales believes that targets will not bring about change quickly enough and advocates quotas to ensure fair representation of women at board level.

6.2 The same progress report (Feb 2012) noted that the number of FTSE100 boards that were all male dropped from 21% to 11% in the year to February 2011, and it looks as though the FTSE100 are making progress to improve the position of women at board level—particularly through non-executive appointments.

6.3 According to the information on the Appointed for Scotland website at 16 October, 40% of public corporation boards there has governance boards that are male only. Women account for 14% of non-executives at the boards of Scotland’s public corporations and 14% of the executive and non-executive board at Scottish Water.

6.4 Of great concern are the results of recent research for Cass Centre for Charity Effectiveness which shows that the skills of senior female staff in the third sector are largely dismissed. Only one woman from the voluntary sector has got to the first stage of a formal interview for a FTSE 100 board, but has heard nothing further, she said. “There are still many who have described working in the voluntary sector as being toxic”. One chair described one of the women’s CVs as “just a little bit of charity work”. There is a complete lack of understanding about the voluntary sector. There is dismissal of the expertise from the voluntary sector but also innate sexism despite the fact that there is clearly an appetite for women to pursue such roles, whether from private, voluntary or public sector background.

6.5 By contrast, the numbers of women in leading roles in Social Enterprises has already exceeded the Davies report targets.

7. To what extent should investors take into account the percentage of women on boards, when considering company reporting and appointments to the board?

7.1 Research has shown that “boards with a strong female presence outperform boards without a strong female presence”.4 Women have an appreciation of the customer base for their businesses and companies like Proctor and Gamble report a measurable 9% growth in profit that they attribute to improvements in gender balance at board level.

8. Why are there still so few women in senior positions on boards, and what are the benefits of having a greater number?

8.1 Men tend to be more confident in applying for senior positions whereas women need to be supported and encouraged to progress to a senior level. One issue is that role descriptions for these posts tend to use language to identify skills which are stereotypically “male”. Women have different qualities/attributes/skills which are sometimes viewed negatively by the men responsible for making the appointments. Everyone in senior positions should understand gender equality and diversity issues so that they can implement the necessary changes.

8.2 The benefits of gender balance on boards have been shown to directly benefit the bottom line in businesses (See 7.1above).

8.3 Organisations that have taken action to improve their gender balance have identified a number of key actions for success, including:––

Mentoring and support (before and after appointment)

Training programmes

Networks

Role models

Succession planning in organisations to ensure that there are women in senior management positions ready to take on the mantle of governance at an appropriate time for them

Early intervention through work with schools and colleges to create a talent pipeline.

9. How successful is the voluntary code of conduct (a recommendation of the Davies Report) which addresses gender diversity and best practice, covering relevant search criteria and processes relating to FTSE board level appointments?

9.1 In the public sector, the situation differs between Scotland and England & Wales. As far as public appointments in Scotland are concerned and, until recently, in England & Wales, the appointing bodies aimed to have women on appointment panels wherever possible. Recent changes to the processes for appointing to these bodies in England and Wales may well change that as the pool of women available to make appointments is diminished. As ever, those who design the recruitment process will need to conduct gender audits on those processes.

21 December 2012