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National Minimum Wage

Volume 474: debated on Thursday 3 April 2008

The Secretary of State for Business, Enterprise and Regulatory Reform
(Mr. John Hutton)

The national minimum wage is just one of a number of issues that I discuss with my right hon. Friend the Chancellor of the Exchequer. As my hon. Friend will be aware, the national minimum wage for adult workers will increase from £5.52 to £5.73 an hour from this October—around 37 per cent. higher in real terms than at its introduction in 1999.

There is no doubt that the minimum wage legislation has enhanced the life of millions of our constituents, but elements of it need to be reviewed. In my right hon. Friend’s discussions with the Chancellor of the Exchequer, will he highlight the case of workers who are given tips by the public that are then put towards the minimum wage, so that the consumer in effect subsidises unscrupulous employers? Given that America has now decided to challenge such legislation, will he do likewise and perhaps meet a small delegation of like-minded colleagues?

I am happy to meet my hon. Friend and others who are interested in what is becoming accepted as a very important issue, and I pay tribute to the work that he has done in highlighting it. The Government are looking seriously at the points that he and others have raised, and I look forward to discussing them with him in more detail.

How widespread is the problem of employers undermining the national minimum wage by making their employees, often foreign employees, pay through the nose for substandard accommodation, and what does the Secretary of State intend to do about it?

I welcome the hon. Gentleman’s conversion to the merits of the national minimum wage. We welcome all the sinners who repent on the Conservative Benches. There is a problem—that is why we are reinforcing the work that we are doing on enforcing the national minimum wage. Legislation currently in another place that is shortly to come here will improve the enforcement measures and strengthen the penalties. It is wrong for legislation that has been passed in this House to be flouted, and particularly unfair and inappropriate for employers to try to take advantage of migrant workers in the way that the hon. Gentleman mentions. We are determined to crack down on the problem. The law passed by this House must be properly enforced, and we are determined to do that.

Further to my right hon. Friend’s reply to the hon. Member for Scarborough and Whitby (Mr. Goodwill), can I take this a bit further and ask what plans his Department has to bring into the excellent minimum wage legislation workers who are involved in temporary and agency work? May I also ask about those, mainly women, who are involved in home working and who are paid peanuts much of the time?

The national minimum wage legislation deals with the issue of home workers through the provisions on piece rates, and temporary and agency workers are covered by the legislation itself. We are in discussion with a variety of interested groups about how we can take forward discussions in Europe on the agency workers directive. I believe that progress is being made on that, and I hope that a further statement will be made in due course.