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Lord Roberts of Conwy: My Lords, in view of the assurances given by the Minister in reply to our earlier debate, I shall not move the amendments in my name.

[Amendments Nos. 27E and 27G not moved.]

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Lord Williams of Mostyn: My Lords, accordingly, I beg to move that the House do not insist on their Amendment No. 27, to which the Commons have disagreed for the reason numbered 27A.

Perhaps I may rectify a gross canard--in fact I shall try to shoot it--which was unloosed earlier by the noble Lord, Lord Elis-Thomas. Should the noble Lord, Lord Crickhowell, and the noble Lord, Lord Roberts of Conwy, be attending and joining us this evening, they are not intruding; they are there as the result of genuinely well-meant invitation.

Moved, That this House do not insist on their Amendment No. 27, to which the Commons have disagreed for the reason numbered 27A.--(Lord Williams of Mostyn.)

On Question, Motion agreed to.

National Minimum Wage Bill

4.36 p.m.

Lord Falconer of Thoroton: My Lords, I beg to move that the Commons reasons and amendment be now considered.

Moved, That the Commons reasons and amendment be now considered.--(Lord Falconer of Thoroton.)

On Question, Motion agreed to.

[The page and line refer to H.L. Bill 87 as first printed for the Lords.]


After Clause 1, insert the following new clause--


(" .--(1) If it appears expedient to the Secretary of State, he may, by order made by statutory instrument, provide for the total or partial exemption from the provisions of this Act of--
(a) any area, sector of employment, trade or industry;
(b) undertakings of different sizes;
(c) persons of different ages; or
(d) occupations or categories of persons.
(2) The power conferred by subsection (1) includes power to make such incidental, supplemental or transitional provision as appears to the Secretary of State to be appropriate.
(3) The power of the Secretary of State to make an order under this section includes the power to vary or revoke its provisions or to limit its operation for a specified period of time by means of a further such order.").
The Commons disagreed to this amendment for the following reason--

Because the Commons consider that the national minimum wage should, so far as reasonably practicable, be uniform for all workers in the United Kingdom and that it is not appropriate to make different provision for different areas, sectors of employment, trades or industries, sizes of undertaking, occupations, or ages over 26.

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Lord Falconer of Thoroton: My Lords, I beg to move that the House do not insist on their Amendment No. 1 to which the Commons have disagreed for their reason numbered 1A. With the leave of the House I shall also speak to Amendments Nos. 5, 6 and 7.

The new Clause 2 amendment--the power to make total or partial exemption at the whim of the Secretary of State--has been described by the noble Baroness opposite in earlier debates as providing real flexibility, a discretionary power, even--in one of her more fantastic flights of fantasy--trying to save the Government from making an horrendous mistake. It is simply not the case that the clause provides a harmless or helpful bit of flexibility. The clause exposes a fundamental difference between this side of the House and Members on the other side. We want the national minimum wage; they do not, and they have never denied that fact.

Despite what the Liberal Democrats have argued, this clause is not about regional variations. It is about exemptions and exclusions, and about tearing an enormous hole in the Bill. We have made clear both here and in another place that we shall resist any attempts to destroy or weaken the Bill. We are told that it is only a discretionary power. But why is it needed? What would be the criteria? Who might benefit from its use? Certainly not the workers who would have the protection that we have fought so hard to provide removed from them because a Secretary of State thinks it expedient.

I suspect that the clause is a device which will allow the Opposition to promise to the electorate at some time in the future that they will not repeal the National Minimum Wage Act. Indeed, with this clause they will not need to do so. It will be killed by the death of a thousand cuts, sector by sector, region by region. Beginning with the smallest firms, the national minimum wage would disappear. Firms may even be tempted to play roulette with their payroll numbers to remain small enough, or to locate to different regions, in order to be exempted.

The power would allow for a fragmented complicated, unfair system where some people have protection; and others, no doubt those most in need of it because they would be in the lowest paying sectors, would be left with no protection. The noble Baroness, Lady Miller, will, I am sure, tell us that the clause is there as a "just in case" measure. Just in case of what, my Lords? In case workers, in some sectors and regions, are no longer entitled to a minimum standard of pay? We reject that argument entirely.

We have acknowledged before, and I do so again, that the Bill already contains certain powers to exempt or vary the rate. Those are contained in clauses currently numbered Clauses 4 and 5. However, those were drafted carefully and deliberately because of our concern to avoid creating dangerous loopholes. That is why they were limited and did not permit variations by region, sector, occupation or size of business.

The Opposition's consequential amendments remove those limitations. A general power to exempt will have one certain result: endless special pleading from employers who do not want to have to pay the minimum

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wage. Let me remind the House that the minimum wage will be set at £3.60 for the full rate. It is a floor to wages not a going rate; and it is not an enormous sum. For a 40-hour week it comes to £144 a week, and that is before tax. It is important to remember these realities. That is what the Bill is all about. We are talking about gross pay of less than £7,500 a year. I believe it is important that workers have the protection of a national minimum wage. The electorate agree. I urge that the House does not continue to press this amendment. I beg to move.

Moved, That the House do not insist on their Amendment No. 1 to which the Commons have disagreed for the reason numbered 1A.--(Lord Falconer of Thoroton.)

Baroness Miller of Hendon: My Lords, perhaps I, like other noble Lords who spoke in the previous debate, may congratulate the noble and learned Lord, Lord Falconer. I probably have to agree with what was said, namely that his promotion was due to the fact that he was involved in the Welsh Bill. Other Ministers who were involved in the National Minimum Wage Bill were not so fortunate and did not survive the reshuffle.

I am disappointed, but I have to confess not surprised, that the one amendment your Lordships made to this Bill, apart from the consequential ones, has been rejected by the other place. After all, we were told by the Minister of State there that it was a wrecking amendment when it was nothing of the sort. We were told that by a Minister who yesterday in the other place once again described the hereditary Peers as descendants of robber barons and cattle thieves and who chastised the Liberal Democrats for siding with what he described as sweatshop owners and backstreet exploiters. He suggested that those who came in to vote on that occasion came in leaving their Ferraris and Mercedes in the carpark with the engines running. I suggest that he has never looked in our carpark. It seems to be that the only new cars there are the government cars.

I am totally amazed that the right honourable gentleman the Prime Minister left that particular Minister in place while he dismissed the noble Lord, Lord Clinton-Davis, and his Whip, the noble Lord, Lord Haskel, both of whom so courteously and ably dealt with this matter in this House. Clearly, the Minister of State in the other place does not understand this place in using the words that he did. Nor do I believe that he understood my amendment. It was a purely permissive amendment that gave the Secretary of State reserve powers to modify the application of the Act which would never be used unless the Secretary of State chose to do so.

I heard with interest what the noble and learned Lord, Lord Falconer, said a few moments ago, that bit by bit, sector by sector--I am not sure whether he said area by area--but whatever he said, the Bill would be eaten away. It certainly would not. Unless there was a need for the Secretary of State to implement any of these sections, he certainly would not need to do so and the powers my amendment gave could quietly remain in

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their pigeon hole gathering dust. Only the Secretary of State could decide to exercise the powers, and nobody could force him to do so.

However, what the amendment did wreck was the excuse that the Secretary of State could make if he was faced with an overwhelming case to modify the national minimum wage, the excuse that "Yes, you are quite right, but unfortunately I cannot help you because the law does not permit me to do so".

The amendment, I admit, would have wrecked the cosy pre-election deal with the unions that in return for their giving up Clause 4 and the power of their block vote within the Labour Party, and in return for not requiring the Government to repeal all the trade union legislation passed by the previous government, they would get the national minimum wage as a consolation prize.

I should like to remind your Lordships, as I have done on several occasions in the various stages--

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