I beg to move,
That this House notes that the Agricultural Wages Board (AWB) was set up in 1948 to provide a fair wage and skills structure for agricultural workers; recognises that it is used as a benchmark for other employment in the food industry and that it was the only wages council not to be scrapped in the 1980s; further notes that around a quarter of agricultural workers live in tied accommodation and that casual seasonal workers may move around the country; regrets that the Welsh Government’s wish to retain the AWB has been ignored by the Government; condemns the Government for its abolition of the AWB, which took place after just four weeks consultation and will take £260 million out of the rural economy over the next 10 years, lead to a race to the bottom on wages in rural areas, reduce living standards and impoverish rural workers, exacerbating social deprivation and harming social inclusion; further regrets that hon. Members could not debate that issue as part of the Enterprise and Regulatory Reform Bill; and calls on the Government to drop its plans to abolish the AWB.
Last week, the House abolished the Agricultural Wages Board without debate and without a vote. The AWB sets the pay and conditions for 152,000 farm workers in England and Wales. That shoddy little manoeuvre was the result of Government desperation to force through the board’s abolition in the teeth of opposition from my colleagues in the Welsh Assembly Government, workers’ representatives and many farmers. Perhaps it was also the result of a fear of another coalition split or Back-Bench revolt. Today, the Opposition are allowing Back Benchers the chance to debate and vote on that abolition—a vote the Government denied them last week.
Like today’s debate, other debates on the subject have been sparsely attended by Government Back Benchers. Perhaps they flinch from defending an ideological decision that will impoverish hundreds, and in some cases thousands, of their hard-working constituents who work the land. We know that the Secretary of State for Environment, Food and Rural Affairs traps squirrels on his estate. His Liberal Democrat colleagues should beware the political traps that he enjoys setting for his coalition partners. In opposition, the Minister of State supported a motion that warned that abolishing the AWB would
“impoverish the rural working class”.
Today, he and his colleagues once again act as midwives to Tory dogma that will make thousands of people in their constituencies worse off—1,020 people in the Minister’s constituency and 1,120 people in the Secretary of State’s constituency.
The abolition of the AWB is wrong on three counts. First, it will take money out of workers’ pockets and out of rural high streets at a time when the economy needs it most. The abolition does nothing to reduce the deficit; it could even increase the deficit by adding to the welfare bill, because workers pushed into poverty pay will claim more in-work benefits and lose the incentive to gain new skills. Secondly, the abolition is bad for our food industry. A race to the bottom on pay will not help to attract the new recruits the industry needs. Thirdly, the abolition is bad regulatory reform because, paradoxically, it will increase the burden of employment regulation on small farmers, meaning that many more of them could end up in employment tribunals. Ministers’ incompetence will result in lower pay, higher welfare spending and more regulation, and it will deepen the recession in the rural high streets they represent.
First, let us look at how the measure will take money off low-paid workers. The AWB protects pay and conditions for 152,000 farm workers in England and Wales.
Does my hon. Friend share my concern that among those working on the land are people like me and many others in Northamptonshire whose first experience of work, under the age of 16, was picking fruit on the farms in rural Northamptonshire? This will have a particular impact on them because they are not covered by the minimum wage.
Absolutely. With the abolition of the AWB, there will be no minimum wage for children under the age of 16 who are picking fruit or driving tractors at weekends and in the summer holidays. When one thinks about the amount of money a tractor is worth, and how such work could become a route into farming for some young people, it will certainly cap their access to that employment.
As well as the 152,000 who are directly covered by the board, a similar number have their wages set against the AWB benchmark, including equestrian workers in the racing and leisure industries, estate workers and gamekeepers. Nearly every constituency in the country has some people who will be affected, including more than 50 people in Wakefield. The board sets fair wages, holiday pay, sick pay and overtime. It has six grades, and the lowest grade is just 2p an hour more than the national minimum wage.
Does my hon. Friend agree that this is another pernicious, shoddy little policy by the Government, who are ideologically driven to cut the wages of ordinary working people?
They are certainly driven by ideology, although the ideology of the Minister of State seems to have changed from when he was a Back Bencher, now that he enjoys the privilege of a Government car. I do not know what has changed for him.
Without the AWB, farm workers will be worse off. As my hon. Friend the Member for Corby (Andy Sawford) said, there will be no minimum wage for children under 16. Seasonal workers will lose their entitlement to their own bed, which is currently guaranteed by the board. The cap on the amount employers can charge workers for tied accommodation, currently £4.82 a day for a caravan, will be removed. Some 42,000 casual workers will see their pay cut to the minimum wage as soon as they finish their current job. The rest will see their wages eroded over time.
What evidence does the hon. Lady have for her statement that all those casual workers will see their pay cut immediately at the end of their contracts? Farmers are desperate to get casual workers, and that is why they are keen for us to continue the schemes to bring them in from eastern Europe. They will not be able to get the staff if, as she suggests, they cut their pay.
I will be talking in detail about the seasonal agricultural workers scheme. I just say to the right hon. Gentleman that 1,610 people in his constituency will be affected by the reduction in pay. I do not know whether he has read the Department for Environment, Food and Rural Affairs impact assessment that was conducted when he was the Minister; I certainly have. It states that 42,000 casual workers are likely to see their pay default to the national minimum wage when their current employment comes to an end. The cost to the rural economy that the Department for Business, Innovation and Skills impact assessment estimates—there are varying figures—are to do with the direct loss of wages, holiday pay and sick pay out of workers’ pockets.
Will the hon. Lady identify what is special about agriculture? Is it that farmers want to exploit their workers, or should there be protection for people in retail, catering and other such industries?
I am surprised that the hon. Gentleman, with 380 workers who will be affected in his constituency, is asking me what is special about agriculture; I believe that he is a farmer, so he might stand up and tell me. Agriculture is different because people are often living in rural isolation; they may have their home provided by their employer, which puts them in a uniquely vulnerable position; and, as the right hon. Member for South East Cambridgeshire (Sir James Paice) said, they are brought in from countries where English is not their first language—perhaps they do not speak English at all—and are not in a position to negotiate. Those are three reasons for starters, but I am happy to come back to that.
My hon. Friend’s speech is hitting exactly the right notes. Has the former Minister, the right hon. Member for South East Cambridgeshire (Sir James Paice), not just given the game away? This measure is about getting eastern Europeans into the country to pay them poverty wages far below those that anybody else would possibly want.
I will look at that in detail later, but we do not want either a race to the bottom on wages or a great increase in the amount that employers charge workers for their tied accommodation—their hot bed in a caravan—which will mean that they end up effectively working for below national minimum wage and undercut British workers out of the market.
My hon. Friend is making an excellent case. One point covered by the AWB that scares me is workers’ sick pay and terms and conditions. At the moment, sick pay ranges from £150 to £250. Once the AWB has gone, employers will have to pay sick pay at only statutory minimum terms of just more than £85. That is a direct hit on workers, a quarter of whom are over 55 years old.
That is right, and we all know that as we get older we are more prone to illness. A further reason why farming is different is that people are expected to work antisocial hours and long hours out in what can be very difficult conditions. We saw that with the flooding last year and when farmers and their employees had to dig lambs out of the snow in the very cold winter we have just had.
I will give way later, but I would like to make some progress.
The Government’s own figures suggest that up to £280 million could be lost over 10 years in wages and in holiday and sick pay—a quarter of a billion pounds taken out of areas represented mainly by the parties on the Government Benches, where the cost of living is estimated to be approximately £3,000 more than for those living in urban areas. Up to £35 million a year could be lost in wages alone—again, those figures are taken from the Department for Business, Innovation and Skills impact assessment.
I want to know what happens when money is taken from rural families on the breadline. Who will pick up the tab? People with children will have recourse to income-related benefits, such as tax credits, council tax benefit and housing benefit. Reducing rural workers to the poverty line will take money out of workers’ pockets and transfer it directly to their employers. We, the taxpayer, will pick up the in-work welfare bill. That will add to the deficit. As a strategy for rural growth and deficit reduction, this thoughtless abolition will be catastrophic.
My second point is that the abolition will be bad for the food industry; it goes against business needs. Britain’s biggest manufacturing industry, the food production sector, needs more skilled workers. Instead, the Government are encouraging employers to race to the bottom on pay. That will see skilled workers turn their backs on the industry—and become MPs instead!
There are 2.5 million unemployed people in the United Kingdom, 1 million of whom are young people. There are 25 million unemployed people in the European Union, yet the horticulture industry still says that it needs to bring in workers under the seasonal agricultural workers scheme because it cannot find reliable British workers. It simply defies economic logic to suggest that a race to the bottom on pay is the way to attract the skilled new entrants that the industry needs.
Is the hon. Lady unaware or simply ignoring the fact that the AWB was debated at length during the consideration of the Public Bodies Bill in both Houses of Parliament? Secondly, is she aware of the impact assessment’s conclusion that current wage levels are generally above the minimum, and that, with wage-setting practices and modern working practices in agriculture, wages are unlikely to be eroded, as farmers will need to attract their workers? That was its conclusion.
I am delighted that the right hon. Lady refers to the AWB and the Public Bodies Bill, the so-called bonfire of the quangos. The Bill certainly brought her a degree of notoriety, as it contained her proposals to sell off the forests and scrap protection for farm workers. She mentions the impact assessment. I am just quoting the Government’s figures: their estimate is as high as £280 million over 10 years, or with a best estimate of £260 million.
Many times during the passage of the Gangmasters (Licensing) Act 2004, I and my hon. Friend the Member for Birmingham, Erdington (Jack Dromey) met the National Farmers Union, employers and all the major people employed in the farming industry, all of whom recognised the valuable contribution of the AWB. Perhaps today we can find out who is the driving force behind its abolition. Employers do not want to get rid of it.
That is very interesting. I was just reading some of the responses to the consultation. One farmer said:
“I am a farmer with 3 employees. The annual AWB wage award has been an invaluable tool to help determine wage awards...We are overburdened with enthusiastic government departments issuing guidance rules & legislation...The annual guidance for the level of wage awards is one of the few useful tools”.
It is quite clear that the proposal to abolish the AWB is not driven by a worry that it holds pay back or conditions down.
Yes, it is.
If the Government are arguing that it is being abolished to enhance pay and conditions, we will hear that from the Front Bench in a moment. Does the hon. Lady agree that we do not want simply to go the lowest common denominator?
I have been making that point repeatedly. The hon. Gentleman has 1,110 people in his constituency who will be affected. I am afraid that we heard some noises off from the right hon. Member for South East Cambridgeshire; he said, “It is,” so it seems that coalition divisions are once more being exposed, as I thought they would be. I look forward to having a chat with the hon. Member for St Ives (Andrew George) in our Lobby during tonight’s vote.
I want to return to the role of the major supermarkets, which have silently supported the abolition of the AWB. Even the farm manager of the Duchy of Cornwall, which supplies Waitrose, responded to the consultation in support of abolition. The Duchy Originals website talks about food that “is good” and “does good” and says that it raises money for charity, but rural workers should not have to rely on charity to feed their families at the end of the week. Today’s figures on food banks, many of which are springing up in rural areas, give the lie to the fact that there is any overpayment in rural areas.
The supermarkets trumpet their commitment to fair trade, but why is that only for workers in developing countries? Why not here? They trumpet their corporate social responsibility programmes in communities, yet are silent when it comes to reducing pay in their own supply chains. I quote again from the responses to the consultation. A vegetable producer in the north-west said:
“We are unfortunately in an industry where we are seeing increasing pressure from retailers to lower prices of supply of produce,”
and added that
“some of our produce price returns are no higher in 2012 than they were over 10 years ago.”
This has real implications for the sustainability of the food supply chain and the UK’s self-sufficiency, which has already fallen to about 55%, making us much more vulnerable to global shocks. The supermarkets have got to start thinking long term. We supported the Government’s creation of the groceries code adjudicator, although we would have preferred an ombudsman. We want fairness in the supply chain, but that does not stop with the horticultural businesses. It has to feed down to the level of the individual workers as well.
I am grateful to my hon. Friend for the case she is making. The Conservative party was once seen as the party of the countryside, but does not the Government’s shoddy behaviour demonstrate just who in the countryside it really stands up for?
Absolutely. It is not even clear whom they support in the countryside, though. I have quoted some farmers opposed to abolition. It is a bit of a mystery who actually wants it. The right hon. Member for South East Cambridgeshire has left the Chamber, so we will never know.
I am listening carefully to the hon. Lady’s case, which makes it clear that she disagrees very strongly with the abolition of the AWB. The Opposition likewise made their opposition clear when other wages boards were abolished in the 1990s, none of which was brought back during the 13 years of Labour government. Will she give us an absolute commitment that, if the Labour party forms the next Government, the AWB will be returned forthwith? Will she give us that guarantee?
If the hon. Gentleman is so keen to retain the AWB—I know that many in his constituency, including the Farmers’ Union of Wales, are against abolition—I hope that that will be reflected in his voting on our side this evening.
I want to deal with the regulatory burdens that could fall on farmers. We have considered the history behind the AWB’s abolition. The board has survived until now thanks to my colleagues in the Welsh Assembly Government, who listened to their constituents and were totally against getting rid of it. Constitutionally, abolition required consent, and they refused to give it.
The motion notes that it is
“the Welsh Government’s wish to retain the AWB”.
Scotland and Northern Ireland can keep their AWBs, of course. Is the hon. Lady making the case, therefore, for a reserved powers model for the Welsh Government?
I think the hon. Gentleman has made that case very well himself. We expect an announcement from our colleagues in the Welsh Assembly Government, but they have made a commitment to retain the functions of the AWB in Wales. We will see what that delivers over time.
All was quiet until the appointment of the Secretary of State for Environment, Food and Rural Affairs, the right hon. Member for North Shropshire (Mr Paterson), who decided to abolish the AWB by tacking it on to the Enterprise and Regulatory Reform Bill—a regulatory reform that could therefore bypass the Welsh Government. His Department conducted a pitifully short, four-week consultation. Let us remember that there was a full 12-week consultation on banning ash trees from Europe four months after Ministers were first told that ash dieback disease was here. We can see where this Secretary of State’s priorities lie—apart from the squirrels. He is swift to take money from workers’ pockets and hand it back to their bosses, but slow to defend the natural environment.
Does my hon. Friend recognise that the Secretary of State represents a border constituency? If, as expected, the Labour-controlled Welsh Assembly maintains the AWB at its own expense, members of the farming community in his constituency would have to travel only one or two miles, potentially, to get a better deal. He will have a skills shortage in his own constituency.
Absolutely. The Secretary of State has not only 1,120 agricultural workers, but a food bank, in his constituency, so that is an excellent point very well made.
I apologise, Mr Deputy Speaker, for being late into the Chamber and further apologise if my point has already been mentioned. I want to highlight to my hon. Friend that not long after the previous Labour Government introduced the national minimum wage, the Conservative party called for the abolition of the AWB, saying that the national minimum wage would cover it, which clearly it would not.
Clearly, the national minimum wage does not cover it all, which is why it was not abolished under various previous Tory Governments. Various Conservative Prime Ministers understood that if someone’s house was provided by their employer, they were in a uniquely vulnerable position when it came to negotiating their wages.
Many small farmers want to keep the AWB so that they do not have to become employment specialists. They want to get on with running their business. Instead, this change will add to their regulatory burden. The Farmers’ Union of Wales, where 12,000 workers are covered by the AWB, opposes abolition. It has said:
“Many farms in Wales run with relatively few staff, or indeed with family labour. The Agricultural Wages Board is considered an important means of avoiding potential conflict and lengthy negotiations with individual members of staff.”
Without the AWB, each farm business owner will have to negotiate terms and conditions annually with its work force. They will make mistakes, as employers sometimes do, and might end up in employment tribunals as a result.
I want to quote again from one of the consultation responses. A farmer in Kings Lynn said:
“I disagree strongly with the abolition of the Agricultural Wages Board...the last thing I want to do with my limited management time is to negotiate wages with my 6 full-time and up to 30 part-time workers some of whom have worked for me for 30 to 40 years and have a strong personal relationship with me. I do not want to damage this by having to negotiate wages with them.”
The hon. Member for Sherwood (Mr Spencer) asked why farming was different. I think that that answers his question.
We have talked about gangmasters and licensing and, before I conclude, I want to touch briefly on the issue of workers’ accommodation. The Government’s impact assessment indicates that 25,500 farm workers have a house or cottage provided by their employer, and that another 4,700 live in other accommodation, such as caravans. The agricultural wages order defines “other” accommodation and guarantees all farm workers that it is fit for human habitation, safe and secure, and that every worker should have a bed for their sole use and be provided with suitable and sufficient free drinking water and sanitation.
Abolishing the AWB will remove those guarantees on housing for farm workers. The accommodation will no longer have to be fit for human habitation, safe or secure. Workers will not be guaranteed a bed for their sole use, and there will be no requirement to provide drinking water or sanitation. I should like to cite the case of one of the firms that wrote in support of the AWB’s abolition, Suffolk Mushrooms. Last year, the firm was fined £10,000 for failing to have a safety certificate for the boiler in the men’s accommodation, and for various hazardous working practices that put workers’ lives at risk, including leaving high-level safety gates open. After the case was won, the Health and Safety Executive inspector, John Claxton, said:
“Suffolk Mushrooms invested more than £1.5 million refurbishing its factory and mushroom growing equipment, yet failed to spend even a few hundred pounds to keep its employees safe”.
Obviously the laws already exist to enable the Health and Safety Executive to fine employers, in every sector of the economy, when they break the law. Does the hon. Lady not accept that she is perpetrating the myth that farmers set out to exploit their workers? The vast majority of farmers listening to the debate today would be affronted by that suggestion.
That was a good effort from the right hon. Lady. The HSE will clearly continue to exist, but I am citing a case that happened last year, not at some other point in time. I ask her whether she thinks that conditions will get worse or better when the AWB is abolished.
The Agricultural Wages Board existed when that case came to light, so it clearly did not create the defence that the hon. Lady suggested it might.
The question for the hon. Gentleman is whether conditions will get worse or better when the provisions are removed. Will they be better or worse for a worker who does not have a bed guaranteed for their sole use? Opposition Members already know of conditions in which people are hot-bedding. Is that what we want to see in our farming industry? I certainly do not, and I am sure that the majority of farmers do not, but there will now be no legal requirement for an individual to have their own bed. I think that that is wrong; does the hon. Gentleman?
The AWB was set up by the Attlee Government in 1948. Even Mrs Thatcher did not abolish it. She understood that if someone’s home comes with their job, they are in a uniquely weak negotiating position with their employer. However, last week’s Bill ended nearly 100 years of protection for farm workers. In the Labour party, we believe that the people who pick the fruit should also be able to buy it in the shops, and not have to rely on food banks to feed themselves and their children. As many farmers themselves have said, in their responses to the consultation, this decision will not secure a stable and prosperous future for the food and farming industry or for those who work in it. The Prime Minister once said that we were all in it together, but time after time, ordinary working people are first in his firing line. If Members want a rural living wage, they should vote with the Labour party this afternoon. If they are happy with poverty pay for their constituents, they should vote with the Government.
I am grateful to the hon. Member for Wakefield (Mary Creagh) for securing a debate on this issue. I acknowledge the strong feelings that she has expressed, but I am firmly convinced that the abolition of the Agricultural Wages Board is in the best interests of all those working in the industry. It will provide simplification and greater flexibility, thereby encouraging investment, growth and job opportunities in the sector.
Will the Secretary of State explain exactly how the board’s abolition will create job opportunities? Will it happen by driving down wages?
I am grateful to the hon. Lady for that early intervention. If she gives me a chance, I will explain my case. I take a completely contrasting view to hers. I have a positive view of agriculture and I see an expanding demand for labour in the countryside. I believe that the current minimum wage arrangements will give protection to those at the lower end of the scale, but I am absolutely convinced—because it is happening already—that the overwhelming number of employees in the sector will be paid well above the minimum wage. Let me make my case; I might be able to convince her.
A successful agricultural industry will contribute to the growth of the wider rural economy, which is one of the four key objectives of my Department. Agriculture is vital for the UK. It produces much of the food that we eat and supports other industries that add nearly £90 billion to our economy. The food supply chain employs nearly 4 million people and includes the largest manufacturing sector in the UK. Exports of agricultural food and drink have seen seven years of continuous export growth and were worth £18 billion in 2011.
There are huge opportunities for further growth within agriculture to meet the demands of feeding the world’s population as it grows from 6 billion to 9 billion. We want to ensure that the UK industry is in the forefront of meeting those demands, and we are already doing a great deal to help to ensure the success of the industry. An example is the joint Department for Business, Innovation and Skills-Department for Environment, Food and Rural Affairs agri-tech strategy, which will provide a framework for research and the development of technologies. It will support growth through encouraging the global uptake of world-class UK-based agri-science and associated technologies, stimulating their translation into high-tech agricultural systems in the UK. We are working on the design of the new rural development programme, which we will use to develop professional skills, including business management and risk awareness, across the agriculture and forestry sectors.
I am sure that the Secretary of State will be telling all this to the workers on his estate, but will he tell the House how many of the people on his estate will be affected by the termination of the AWB?
I have to disappoint the hon. Gentleman by telling him that I do not have an estate, and that I do not have any direct employees who take the agricultural wage.
I shall take up my case again. In addition, I want to give businesses the tools they need to have the confidence to invest, adopt and benefit from innovative technologies and farming practices.
Those tools will be extremely helpful, especially for research and development, but in relation to today’s debate, will my right hon. Friend tell me whether he thinks that agricultural wages and conditions will go up or down as a result of the abolition of the AWB?
As I said earlier, I am absolutely confident that there is a great future for the industry, and that there will be an increase in demand for labour, which will create pressure to drive wages up. Already, under the AWB, the vast majority of people in the industry are paid well above the minimum wage and well above the AWB minimums.
Another key area in growing the economy is the roll-out of superfast broadband to rural areas, and increasingly wider access to 3G and 4G networks will also make it easier for farm and rural businesses to operate.
I listened carefully to the Secretary of State’s response to the hon. Member for St Ives (Andrew George). If wages and conditions were to go down, if that were to encourage migrant workers to come to this country to work for the lower wages, and if that were to result in problems in the community, whose fault would that be?
The hon. Gentleman and I have debated these issues over many years, and we simply do not agree. Would he like to go back to the arrangements under some of the earlier councils? Why did not the Labour Government re-establish the Linen and Cotton Handkerchief and Household Goods and Linen Piece Goods Wages Council (Great Britain), for example? Why did they not re-establish the Ostrich and Fancy Feather and Artificial Flower Wages Council, or the Pin, Hook and Eye and Snap Fastener Wages Council? Why did they not re-establish the rubber-proof garment-making industry wages council? This is the last throwback to an era during which these sort of councils did, I am sure, a worthy job, but we now have a free and expanding market and demand for labour in the countryside. To answer his question directly, I am absolutely confident that wages will be well above those currently set by the AWB. [Interruption.] The hon. Gentleman says “If”, but it is not a question of “if”: wages are currently well above those levels.
I absolutely share my right hon. Friend’s confidence in the future of agriculture. As he will know, in Herefordshire we have a thriving agricultural sector, and it will be all the more enhanced by broadband. Does he share my surprise that despite its denunciation of the measure, the Labour party is unwilling to state whether it would restore the Agricultural Wages Board?
I am grateful to my hon. Friend, who picks up on the earlier question that the shadow Secretary of State singularly failed to answer. On my hon. Friend’s behalf, I pose this question to her: if a Labour Government were to be elected after the next election, would the AWB exist? Will they bring in legislation to re-establish an agricultural wages board?
The right hon. Gentleman asks me a direct question. We are two years away from the next election, and I am sure he will be looking forward with great eagerness to our manifesto. We will look at all measures that stop the public sector, the taxpayer, subsidising poverty wages, wherever they occur in our economy.
I think my hon. Friend will take that as a no.
I give way to my esteemed predecessor.
I am grateful to the right hon. Gentleman, who has now asserted more than once, as has his predecessor, that the outcome will be to improve the wages and conditions of agricultural workers. In that case, will he tell us where the savings his Department identifies will come from?
I am grateful to the right hon. Lady for that question. There are modest administrative savings from the running of this organisation. Labour Members concentrate on the impact assessment, which makes it clear that we have a dynamic market, stating:
“Current wage levels are generally above the AWO minima & are underpinned by the National Minimum Wage.”
On page 3, it says:
“Government intervention is no longer necessary because…it is considered that there is no market failure in the agricultural labour market such that workers require protection which is over and above other statutory terms and conditions and wider employment legislation applying to all workers.”
Let me pick up my thread again. I am confident that we have a thriving sector with demand for labour, which will push wages up, not down. I have touched on the farming regulation task force, which will remove a whole range of regulatory burdens from farm businesses. In fact, since 2011, we have removed £13 of compliance costs for every pound added. There will be 12,000 fewer dairy inspections a year.
The abolition of the Agricultural Wages Board will complement and supplement this work. That is why I find the position of the Opposition Front-Bench team so disappointing. Agriculture is now the only sector of the economy to retain a separate statutory wages regime. There is no rationale for treating agriculture any differently from other sectors. More than 900,000 businesses in England and Wales are micro-businesses that employ between one and nine people. The vast majority of those cover sectors other than farming and do not require an independent body to set employment terms and conditions, so there is no reason why it is still necessary for farm businesses.
It was in fact the last Labour Government who set up a single national minimum wage, and whose Minister, the noble Lord Falconer argued that
namely the Labour Government—
“do not believe that a multitude of regional, sectoral or other minimum wages is the right approach. It is neither sensible nor justifiable intellectually.”—(Official Report, House of Lords, 11 June 1998; Vol. 590, c. 1240.)
Agriculture has moved on significantly from when the current wages board was established 65 years ago under the Attlee Government. It is now a global business and the price of agricultural commodities is determined by international supply and demand. British farmers have to compete not only with each other, but with farmers overseas in order to sell both here and in international markets.
The industry has become highly scientific and mechanised, with developments in plant and animal breeding, improved fertilizers and pesticides, and other scientific and technological advances. Workers in the industry need to be highly skilled and specialised. Modern farm businesses are no longer confined just to agriculture. Around a quarter of farms have now diversified into non-agricultural activities, such as rural tourism, retail and sporting activities. Rural tourism alone is worth £33 billion to the economy.
The agricultural wages order takes no account of the changes within agriculture, but imposes an inflexible structure, which is no longer appropriate for the varied and diverse businesses within the industry. This is an industry whose processes, structures and products would be barely recognisable to those drafting or debating the Agricultural Wages Act 1948.
Many farm businesses are faced with the burden of having to administer both the agricultural minimum wage regime and the national minimum wage regime. Employers have to decide whether or not a worker’s activity is covered by the provisions of the agricultural wages order or by general employment legislation. In some cases, there are grey areas as to whether or not work is covered by the agricultural minimum wage or the national minimum wage. For example, packing of salad and vegetable produce grown on farm would normally be covered by the agricultural minimum wage, whereas packing of produce bought in from other farms is not.
Abolition of the Agricultural Wages Board will allow agriculture to compete on a level playing field with all other sectors of the economy, with all employees treated equally and all underpinned by the national minimum wage and other statutory provisions. Such an approach was championed by the last Government. Speaking in the Committee stage of the National Minimum Wage Bill, the noble Lord Falconer argued:
“a single national minimum wage is a fundamental principle of the Bill. A single rate is easier to understand and fairer and easier to enforce...I believe that there is a great virtue in simplicity. The simpler we can make the provision, the simpler and more effective the Bill will be. People will know what their rights are. There will be no difficulty in understanding their minimum wage entitlement; and there will be no over-complexity, which might lessen the effect of the Bill.”—(Official Report, House of Lords, 11 June 1998; Vol. 590, c. 1240.)
It is that over-complexity and bureaucracy, as represented by the Agricultural Wages Board, that we are seeking to remove. This will improve the industry’s competitiveness to produce for both domestic and export markets. About 40% of our fresh vegetables and 90% of our fresh fruit are imported, so there are plenty of opportunities for domestic growers to improve their share of the market. Abolition will remove outdated and prescriptive regulations that hamper the ability of industry to offer flexible modern employment packages, such as the payment of annual salaries.
Is the Secretary of State saying that enhanced statutory sick pay is an outdated term and condition for farm workers, who have now had it removed due to the abolition of the AWB? Is he really saying that?
The hon. Gentleman has misunderstood. All the existing conditions continue.
As I say, abolition will remove outdated and prescriptive regulations that hamper the ability of industry to offer flexible modern employment packages, such as the payment of annual salaries. It will simplify employment legislation in the sector, provide transparency and make it easier to recruit workers. In the absence of the board, farmers and workers will be able to agree employment terms and conditions that suit the requirements of the farming sector and the particular circumstances of individuals.
I wonder whether the Secretary of State will answer a question that was asked many times but never answered when the Public Bodies Act 2011 was in Committee. Did the Government consider modernising the board rather than abolishing it?
All sorts of options were considered, but we concluded that the answer was to abolish the board, thus bringing agriculture into line with every other employment sector in the country.
I fully understand the concern about the impact on workers’ wages and terms and conditions as they adjust to the level playing field and move from being set by a system of statutory wage fixing to being set by the market. However, the figures that the hon. Member for Wakefield and Unite have been using have been cherry-picked from the impact assessment and are based on the worst possible scenario, namely a reduction in the wages of every single worker in the agricultural sector. Anyone with any understanding of the farming industry, or the market, knows that that simply will not happen.
The abolition of the Agricultural Wages Board will not
“lead to a race to the bottom on wages in rural areas”
or “impoverish rural workers”, as the motion suggests. It will give farmers and workers the same flexibility to agree terms and conditions as is given to employers and workers in all other sectors of the economy, while also securing the same levels of protection. Most workers already have terms and conditions over and above those in the agricultural wages order, and as contracts are already in place, their wages should not be affected. In 2010, the basic pay of full-time permanent workers was 12% above the AWB minimum for their grade, and non-permanent grade 1 and 2 workers were paid 4% above the AWB minimum for their grade. More than two thirds of permanent employees aged over 21 earn above the agricultural wage minimum at grade 1, and more than half do so at grade 6.
The National Farmers Union has described the abolition of the AWB as “a progressive reform”, which is something in which the Labour party used to believe. The “bottom up” takeover of the party by the trade unions seems to be almost complete.
I can reassure the House that agricultural workers who have existing contracts at the time of abolition will continue to retain rights to pay at the appropriate grade level, along with the other terms and conditions in the current agricultural wages order. For the avoidance of any doubt, we intend to provide for that in legislation. Employers will not be able unilaterally to alter terms and conditions for an existing worker without legal consequences. New workers coming into the industry will be protected by the national minimum wage and by wider employment legislation.
The hon. Lady has described the national minimum wage as
“one of the Labour Government’s greatest achievements.”
Why should we not let agricultural workers benefit from that achievement? The national minimum wage provides sufficient protection for 99.5% cent of the work force, including those who operate factory machinery, those who drive heavy vehicles, and those who care for the sick, the elderly or children. There is no reason why it should not also provide sufficient protection for agricultural workers.
The Secretary of State has repeatedly mentioned the national minimum wage and the fact that it was introduced by the last Labour Government. Let me say to him, as the former Secretary of State who introduced the national minimum wage legislation, that it was no accident that when we introduced that legislation—which was, of course, opposed by both the parties who are now in government—we did not abolish the Agricultural Wages Board, precisely because we recognised the particular vulnerabilities of agricultural workers.
In October this year, the Government will raise the national minimum wage by 12p an hour to £6.31. [Interruption.] Let me respond to the chunterings of the shadow Secretary of State by pointing out that that is 10p above the lowest band rate set by the Agricultural Wages Board. Agricultural workers supplied by a labour provider will continue to have the added protection of the Gangmasters Licensing Authority. We will also make changes to the working time regulations by means of secondary legislation in order fully to align the treatment of agricultural workers with those in other sectors.
Will the Secretary of State promise that if the wages and terms and conditions of agricultural workers start to decline after the abolition of the Agricultural Wages Board, he will reinstate the board?
I cannot promise anything. It is up to individual employers. What I do know is that employers throughout the country are crying out for good staff. Finding a good cowman is like finding hens’ teeth, and a really skilled driver of a modern piece of equipment worth hundreds of thousands of pounds is someone an employer will really hang on to.
I have already answered the hon. Lady’s question. She takes a completely black view of the economy, but this is an expanding sector that demands skilled people.
I am going to press on. Other Members want to speak.
I believe that agriculture needs to encourage new and young workers to come into the industry. Evidence suggests that the skills shortage in agriculture will be greater in the years between now and 2020 than in other sectors of the economy. The agricultural work force is also ageing: 55% are over 45, which, again, is a higher figure than is found in other sectors of the economy. Under the new arrangements, market drivers will ensure that wages remain competitive. Farmers will need to offer competitive employment packages and career opportunities at all levels to recruit and retain workers to meet their business needs.
Of course, we recognise the need to ensure a smooth transition for agricultural workers and employers to the new arrangements. Subject to parliamentary approval for the Enterprise and Regulatory Reform Bill, we intend to invite industry representatives to a meeting to explore whether there is scope for future informal, voluntary industry engagement between employers and workers. DEFRA also supports a review of the agricultural skill levels used in the agricultural wages order, which will contribute to the broader work of the industry AgriSkills Forum. We will ensure that written guidance and information is available for workers and employers to help them understand the changes and what they mean for them.
The abolition of the Agricultural Wages Board will allow the industry to modernise while ensuring that agricultural workers have the same levels of protection as workers in all other sectors of the economy. It will ensure a vibrant and sustainable future for agriculture and will have benefits for those who work in the industry, as well as the wider rural economy.
The motion seems to look upon the UK agriculture industry as though it is still powered by beer, sandwiches and steam, when in fact it is reliant on cutting-edge technology, machinery and science. The Government wish to equip the agriculture sector for the challenges and opportunities of the 21st century. The Labour party and its union backers do not. We will vote against the motion.
Several hon. Members
Order. I think 12 Members wish to speak in the debate. I am reluctant to set a time limit, so if everybody speaks for about nine or 10 minutes, we will comfortably get them in. If somebody does not comply, they will be using another Member’s time and a time limit will be necessary. I hope that is clear.
The Agricultural Wages Board is important in constituencies such as mine—rural communities where there is already much poverty, and wages are low. Established by the Attlee Government in 1948, the board has served us for the last 65 years, setting a minimum wage and terms and conditions of employment for workers employed in agriculture. It costs the Government little to administer; I am told that it will probably cost more to abolish than to maintain.
It appears that the decision to abolish the Agricultural Wages Board is not based on financial evidence. It is yet another decision from a Government who spurn concepts such as data and evidence in favour of ideology and dogma. Once again, their adherence to ideology and dogma will have an impact on one of the hardest working and least well paid groups of workers in our rural communities.
The Government were intent on abolishing the Agricultural Wages Board from day one. The original announcement was made in July 2010. The leading party in the coalition Government, whose MPs include members of the wealthiest landowning families in this country, hardly had time to get their well-heeled shoes under their new shiny Government desks when they made their initial announcement. However, before the Government could take the final abolition decision, I understand they were told that they needed to carry out a consultation of interested parties or face a judicial review that they would probably lose on the grounds of insufficient consultation, and that they needed the consent of the delegated Welsh authorities to abolish the board.
Given that the hon. Lady knew about the decision in 2010, has there not been adequate time between then and now to consider all the options?
I am not the Government, so I cannot respond to that question. Had I been the Government, I would have stuck to their rules and standards for consultation. They did not.
What did the Government do? Did they conform to Cabinet Office standards for consultation? Did they carry out an extensive 12-week consultation, avoiding main holiday periods, and making extensive efforts to ensure that all those affected, as well as all those with an interest, had an opportunity to take part? Did they carefully consider the outcomes of consultation in their final decision? Did they consult the Welsh Government, whose agreement was needed for abolition? They did none of those things; they came up with an extremely shabby plan to get round them.
The Government redefined the Agricultural Wages Board as a “regulatory reform” to avoid the necessity of even trying to get the co-operation of the Welsh Government, and they cobbled together a four-week consultation that failed to meet their own standards on consultations, issued by the Cabinet Office. Even then, 63% of those who responded to that sham and shameful consultation disagreed with abolition, so they were simply ignored.
Having failed to carry out a proper consultation, the Government decided to attach an amendment to the Enterprise and Regulatory Reform Bill and pushed it through the House without debate. When the Government hold something that is clearly a sham consultation over four weeks instead of 12, ignore their own standards, and then ignore the results of the consultation, is it any surprise that people question, and are suspicious of, any public consultation?
The problem was not just the lack of consultation with the public, but the lack of consultation with the House. Those of us who were engaged in the passage of the Public Bodies Bill expected that there would be a full debate on the abolition of the Agricultural Wages Board in the future but, whether through cock-up or conspiracy, we were denied that opportunity.
I agree with the hon. Gentleman. This is not a decent way for a Government to behave. Hon. Members start to feel superior about foreign Governments that we consider illegitimate when we see them behaving in this way. We criticise such behaviour in others, and it is not what the House and the country expect from our Government.
Why are the Government so desperate to abolish the Agricultural Wages Board that they will breach their own consultation and deny debate in the House? Is the board excessively expensive? Does it act illegally? Is it so far beyond reform that the only way to deal with it is by abolishing it in this high-handed manner? It is a public body that costs very little, yet decides the terms and conditions of agricultural workers. It sets rates for young workers, including those under 16, who are not covered by the minimum wage. It also sets out maximum deductions for tied housing, which affects up to a third of farm workers.
Why are the Government so determined to use whatever means possible to abolish the board? Their only answer is that it is too bureaucratic for farmers, so implementing decent wages and conditions for workers on top of all that form filling to claim EU farm subsidy payments is clearly too bureaucratic. The Government argue that abolishing the Agricultural Wages Board, and hence the agricultural minimum wage regime, will simplify employment practices and remove an unnecessary regulatory burden. The problem for farmers is therefore nothing whatsoever to do with the predatory practices of the supermarkets, but all about the time it takes to read the annual bulletin from the Agricultural Wages Board.
The Government’s impact assessment shows clearly that workers’ wages will fall by up to £34.5 million a year over 10 years as a result of abolition. For new contracts, the change in the value of annual leave, if employers implement statutory terms rather than those under the agricultural workers order, will be up to £13 million a year over 10 years. Farmers’ employment costs that represent transfer payments to the Government and others will fall as wages fall, so the Exchequer will also be hit, and that is before we consider the cost to the public purse of paying the working benefits that agricultural workers will need as their wages fall.
The north-east is the region that has the smallest number of people working in agriculture. That is partly because it is the smallest region and partly because it has the highest rate of unemployment in the country. Nevertheless, 3,360 people in the north-east work on the land. The abolition of the board will have a direct impact on 60 people in my constituency. If we force agricultural workers off the land and cannot attract younger workers, just who do Ministers think will fill these jobs? Let me tell them: it will be people from overseas.
According to the Government’s figures, the abolition of the Agricultural Wages Board will take £260 million out of the rural economy over 10 years. It will take money out of rural communities, village shops, pubs and post offices, and away from everyone who relies on those businesses. Rural communities have already lost local buses, and the Government are set on a national funding formula for schools that has no place for a small schools premium, which will result in the closure of rural schools—hon. Members heard it here first. The abolition of the board will lead to lower wages, poorer rural housing and an increase in the number of immigrant workers on the land. The way in which the Government have brought about the abolition does them no credit whatsoever, yet the real tragedy is not the way this discredited Government have acted, but the real impact that their policy will have on rural communities such as mine throughout the country.
I am glad to have the chance to speak in this debate. I have been getting increasingly frustrated, as is often the case, by what seems to be a cack-handed effort on the part of the Opposition to ingratiate themselves with the rural community. In so doing, they have managed to be pretty offensive to every aspect of the rural community.
I can only share some anecdotal thoughts in this debate. Prior to entering Parliament, I spent 28 years working in various parts of that community. I have worked on a farm, I have worked for farms, I have worked for big estates and small estates, I have represented landlords, tenants and farm workers, and I have worked in forestry and country sports. There is almost no aspect of the rural economy and the rural community that I have not come into contact with over quite a long period.
Throughout that whole period, not one single person ever said to me, “Of course, what we really need to do is preserve the Agricultural Wages Board.” In the run-up to the last election, I asked a group of farmers and farm workers in my constituency if there was a single thing that the Government could do: if there was one thing only on the Christmas list, what would it be? Without hesitation, the answer was, “Get rid of the Agricultural Wages Board. It has outlived its usefulness.”
Can the hon. Gentleman tell us what members of the Farmers Union of Wales told him in response to that question?
I can. The FUW members supported the abolition of the Agricultural Wages Board. The FUW as a union made rather a different representation. I speak on behalf of members in my own constituency. Of course I cannot speak for the union based in a different area.
One of the things that I find startling is that the shadow Secretary of State, the hon. Member for Wakefield (Mary Creagh), rather than the whole party that she represents, seemed to find it impossible to believe that an owner, a manager, a farm worker and a forester can all work harmoniously together because they have a common shared love of food production or a common shared love of their community and want to do the right thing by their farmer. That seems to be a concept that the Opposition cannot absorb because they have a union-fuelled view that it is some kind of Dickensian existence out there. For those of us for whom it is our daily life—it is where I shall be by the end of tomorrow—it is not like that. It may be like that in Wakefield, but it ain’t like that in Pembrokeshire.
I am particularly sad that the shadow Minister, the hon. Member for Ogmore (Huw Irranca-Davies), is not in his place. He seems to be dancing to the union tune on the subject. I know Ogmore in the way that he knows Pembrokeshire, and we both know, as I said, that this is not an issue for agricultural workers in either of our constituencies. I am surprised that he has not stood up to the pressure from the sponsors of the debate and spoken on behalf of the agricultural workers, with whom we are all familiar and for whom we have great respect in west Wales.
I deal with about 9,000 pieces of casework a year and I have not had a single farm worker write to me on the issue, which is surprising, but not when we think that the overwhelming majority of livestock farmers and dairy farmers in places like ours do not employ anybody, because they themselves are so hard up and are probably existing on significantly less then the minimum wage, considering what they earn and the hours that they work. We should be concentrating on how those farmers can get a fair deal for feeding the rest of us.
The hon. Gentleman speaks with great knowledge because he represents an area suffering those hardships.
I shall not speak for long. I find it bizarre that last night when my hon. Friend the Member for Montgomeryshire (Glyn Davies) was fronting a debate on the hardship facing upland farmers, I was reprimanded by Mr Speaker for mentioning cattle when I should have been speaking about sheep. Never mind. Here we are debating something which is not relevant to the hardships facing the agricultural industry, certainly in my area, when we should be devoting our energy to other matters. I am surprised that the shadow Secretary of State was not there to hear the debate, which was important and involved her party as much as it involved ours. I am surprised that we are engaged in the present debate when we know that the abolition of the Agricultural Wages Board will not leave agricultural workers, certainly in my area, exposed or vulnerable.
Does my hon. Friend agree that if we believed that abolishing the Agricultural Wages Board would lead to some decrease in the wage agricultural workers are paid, we would not be in favour of it? It will not make any difference at all. The Opposition are keen to emphasise that it will, and they are wrong because they do not understand the countryside. They are driven by a completely different motive.
I think that my hon. Friend is wrong on only one point: he says that the Labour party does not understand, but I think that it understands only too well. It is caught in a difficult position because its union sponsors are saying one thing and its constituents in certain areas are saying another.
May I just confirm that, as a former barrister, I neither belong to a union, nor am I financed by a union? I am concerned about the working conditions and pay of working people. I will ask the hon. Gentleman the same question I asked the Secretary of State earlier: if after the abolition of the Agricultural Wages Board we find that workers’ wages, accommodation and so on deteriorate, will he reintroduce it?
It might surprise the hon. Lady to learn that I am not a member of the Government and so I am not really in a position to answer that. Of course, I sat through 13 years of Labour disdain for rural Britain, and that question was asked on many occasions. However, I do not want to be reprimanded by the Chair twice in two days for getting off the topic by talking about union sponsorship, so if she will forgive me—
The hon. Gentleman said that the motion is somehow sponsored by unions. It is nothing of the sort. This debate is about a point of principle—[Interruption.] I am sorry that Government Members are laughing. This debate is about whether people who work in remote, isolated areas, in unseasonable conditions and in one of our most dangerous industries deserve to be paid 2p an hour above the national minimum wage and to have some sort of protection against eviction from their homes.
The hon. Lady will forgive me if I note that pretty much all the electronic traffic we have seen on this debate has been generated by her party’s biggest sponsor. Call me a cynic, but I am not going to accept her comments.
I believe that workers in my area are protected by the minimum wage, employment legislation and a raft of accommodation legislation applying to tied cottages and the like. I do not recognise the image projected by the Labour party of farm workers in tied cottages, and have 28 years’ experience in the industry. I agreed with the Secretary of State when he referred to the noble Lord Falconer’s comment that regional and sectoral pay was a thing of the past. I find it odd that we seem to be disagreeing with that now.
The final abolition of the AWB raises two questions, both of which have been raised before, but since neither has been answered I will ask them again. If the abolition of the AWB exposes young workers, foreign workers or people who are vulnerable, either through poverty or in some other way, in the way the shadow Secretary of State has set out—I know all about the unique aspects of agricultural work—why is it that no other sector in the UK from which a wages board has been removed is suffering from those consequences? Perhaps she could explain—we asked this question earlier but did not get an explanation—why those dangers are apparently unique to agriculture. I will ask her a third time, more in hope than in expectation: would Labour reinstate the AWB if it was lucky enough to form a Government in 2015? It is no good her saying that they have a couple years to come clean about their proposals. I think that this is absolutely the right forum and the right time to make clear the policy as it applies to the AWB of a party that might—I hope not—form a future Government.
I begin by telling the hon. Member for Carmarthen West and South Pembrokeshire (Simon Hart) that it is not just Conservative Members who represent rural areas; many of us on the Opposition Benches represent large rural communities, know them, understand them, live in them and want to represent them in the House today.
In this week of praise for great Prime Ministers of the 20th century, I would like to add my words of praise for Clement Attlee for introducing the original legislation in 1948. I do so not to look back more than 60 years to the conditions in 1948, but to put it on the record that these things matter today for my constituents and those of other Opposition Members.
I represent a constituency north of the border, where this discussion has no real relevance or impact, but farm worker constituents who have contacted me are in solidarity with their colleagues in England and Wales and say that what is going on is absolutely wrong. I appreciate that the hon. Member for Westmorland and Lonsdale (Tim Farron) says that he has not been contacted, but I have. Perhaps his constituents have not contacted him because they have no trust in what he is doing.
This issue certainly matters to people across the whole of the United Kingdom because, even though the AWB is for England and Wales, its abolition will have an impact throughout the UK.
In my constituency, 235 businesses are involved in agriculture and farming, and more than 11% of my constituents work in the agricultural sector. The market town of Mold in my constituency depends not only on the cattle and agriculture markets to bring people in, but on the wages of people who work in agriculture to maintain its shops, business and rural community.
I have a great deal of respect for the right hon. Gentleman, but the National Farmers Union briefing states:
“The Annual Survey of Hours and Earnings (ASHE) for 2010 showed that 90% of workers employed in agricultural trades received gross pay above £6.50 an hour”,
which I think was the minimum set by the AWB. If he is seriously concerned about wage levels in the agricultural sector, how does he respond to that review of actual pay levels?
I am grateful to the hon. Gentleman for his question. I am genuinely worried that wages will fall when the AWB is abolished, and I am not the only one: the Farmers Union of Wales, which I will come on to later and which represents the bulk of farmers in my area and other farmers in Wales, supports the official Opposition’s stance against the abolition of the AWB. There is a division of opinion and we need to expose it.
I am not sure that I follow the right hon. Gentleman’s logic, so could he talk us through it a little more? If 90% of pay is already above the AWB’s minimum, how come it has not already fallen back to that minimum?
If the hon. Gentleman will let me develop my argument, he will see that this is not just about pay. He was not here at the time, but the Secretary of State kept me up for 36 hours so he could vote against the minimum wage. He did not do that so that wages could rise; he did it so that wages would not rise. My worry about the abolition of the AWB is based on exactly the same principle: it will remove a floor that protects the work force in my constituency.
As I have said, my constituency depends on agriculture and more than 11% of my constituents work in agriculture. Courses in horticulture and agriculture at Northop college bring in people to train in agriculture. These are key issues. Although Government Members may view minimum rates of pay, overtime, holiday entitlement, sick pay, rates of pay for young workers, compassionate leave, rest breaks, maximum deductions for tied housing, allowances for keeping working dogs and payment of on-call and night allowances as issues of regulation, to my constituents they are bread and butter matters that impact on their lives and they want their representative and others who represent rural areas in Parliament to stand up and speak on their behalf. They are not idle issues.
I am getting a bit long in the tooth. I have been here for 21 years and the first Bill Committee I sat on was for the 1992 employment Bill that abolished every single wages board apart from the AWB. That Bill was taken through this House by the then Member for Stirling, the now noble Lord Forsyth, who is not known for his left leanings, but who decided to maintain the AWB because he recognised, even at that time, that it was crucial for conditions as well as wages.
The national minimum wage has been mentioned. I was very proud to vote for the national minimum wage and am grateful that my right hon. Friend the Member for Derby South (Margaret Beckett) is here. It was one of the greatest achievements of the Labour Government. The then Opposition kept this House up late into the evening because they did not support it. Why should we trust a party that does not support the national minimum wage when it says that this measure will maintain or improve pay and conditions?
Is it not right that over the past 15 or 20 years, the Conservative party has always taken away working people’s rights and benefits when in government?
My main worry is that the assessment of the Welsh Assembly that some £26 million to £28 million will be taken out of agricultural wages in Wales over the next 10 years will prove to be correct and that rural poverty will increase. That is money that will not be spent in the shops of Mold, Holywell and Flint in my constituency, that will not help to sustain the rural economy in my constituency, and that will not be spent in the rural post offices, pubs and communities of my constituency. That money will be lost to the area. This measure will be damaging for the 13,829 people across Wales who work in the agricultural sector and who depend on the wages board.
As I have mentioned, the Farmers Union of Wales, which, with respect to the hon. Member for Carmarthen West and South Pembrokeshire (Simon Hart), is not affiliated to the Labour party, has said on many occasions that it opposes the moves by the UK Government to abolish the Agricultural Wages Board. It stated:
“The Union has always supported the AWB and remains concerned that unless there are systems in place to protect payments to agricultural workers, the industry will not attract the highly skilled individuals it needs to thrive”.
It went on to say:
“As many farms in Wales run with relatively few staff, the AWB is considered an important means of avoiding potential conflict and lengthy negotiations with individual staff”.
It also said:
“The economic climate within the agricultural industry has made it a less attractive option for young people, and rewarding skills, qualifications, and levels of responsibility is a vital means of persuading high calibre people to remain or enter into the industry.”
As my hon. Friend the Member for North West Durham (Pat Glass) said, the Labour-controlled National Assembly for Wales was not consulted about the abolition of the AWB, as it should have been by statute. The Government failed to do that and passed the measure through the back door in a Bill that did not require consultation. The Secretary of State knows that he should have consulted the National Assembly. These are important matters for my colleagues there. As has been mentioned, the National Assembly may outline shortly its plans to keep the minimum wages and conditions set by the Agricultural Wages Board in a Welsh context. However, that will involve bureaucracy and cost. It would have been far better, particularly from a Unionist party, if the conditions had been maintained across England and Wales.
As I mentioned in an intervention, the Secretary of State represents a border area. His constituency of North Shropshire is not far from mine; his borders Wales and mine borders England. If there are different terms and conditions on either side of the border, the market will flow across it. If the conditions are worse in England than in Wales, which they may be if the Welsh Assembly retains the board, the Secretary of State will find that there is a flow of individuals looking for better terms and conditions, who will perhaps only have to travel 1 or 2 miles across the border. I find it strange that that will be caused by a Unionist politician. Mold, Holywell and Flint in my constituency will lose income because of this measure, but I believe that there will also be a confidence issue.
In conclusion, 63% of the people who were consulted did not support this measure and the Welsh Assembly does not support it. I accept, as the hon. Member for Carmarthen West and South Pembrokeshire said, that Unite the Union does not support the measure to abolish the board, but it is part of a broad-based coalition that does not accept it. The Minister of State—the Tonto to the Secretary of State’s Lone Ranger—did not support this proposal in opposition, but is an advocate of it in government. He should examine his conscience and think about what is in the interests of his constituents.
The people driving the change are the same people driving tax cuts for millionaires. They are out of touch with their communities and with rural areas. I am proud to represent a rural area and speak up for it in Parliament, and I will be proud to vote today and say that whatever has already happened in legislation, I support the AWB.
This is a difficult debate, and I am grateful to the Labour Opposition for having brought it forward. In a point of order after the debate on Lords amendments to the Enterprise and Regulatory Reform Bill last week, I said how strongly I opposed our having had neither a debate or a vote on this significant matter. As I indicated earlier in an intervention, we had only limited opportunities to discuss the abolition of the AWB, among a large number of other measures, in our debates on the Public Bodies Act 2011. We were reassured throughout those debates that the House would have ample opportunity to debate the issue and come to a conclusion on it at a later stage, when a specific proposal was brought forward under the powers in schedule 1 to that Bill. I come at this debate on the basis of a significant disagreement with how the Government have handled the matter and frustration that we are shutting the stable door after the horse has bolted. Nevertheless, it is important to have the debate.
I listened carefully to my right hon. Friend the Secretary of State and did not get the impression that the AWB was being abolished because it was holding back wages and conditions for agricultural workers. In fact, I still have a strong impression that the opposite is true. I know that there has been a lot of speculation about the outcome of the abolition, but I am clear that it is not happening to enhance agricultural workers’ pay and conditions.
I also find it difficult to understand the impression that the Government are giving, given the slogan “We’re all in this together”, which they adopted in their first Budget and which I approve of entirely. One good proposal from the European Commission on the common agricultural policy is to cap the single farm payment at €300,000 and disburse the money saved in different ways. That could have been on the agenda under the previous Administration 10 years ago, but we are where we are. On the one hand, the Government are content to pay cheques of more than £1 million to large farmers who, frankly, usually do not need it. On the other hand, I fear the abolition of the AWB will mean that more public funds need to be deployed to pay the wages of agricultural workers who find their conditions and wages cut, or to pay benefits to those whose standard of living falls below a certain level. In both cases, a lot of public money is involved, in one case enriching large farmers and in the other subsidising poverty in our rural areas. I am not content with that contrast, and I will draw conclusions about it at the end of my comments.
The abolition of the AWB was not in the Liberal Democrat manifesto. It was in the Conservative party manifesto, however, and indeed the NFU made it clear in the lead-up to the last general election that it was very much in favour of the abolition of the AWB. That was certainly the case in my area, so my experience contrasts with that of the hon. Member for Carmarthen West and South Pembrokeshire (Simon Hart) on that point. One of the NFU’s key asks was the abolition of the AWB, yet when I raised the issue with farmers, I found that a significant number of them were opposed to that policy. They were opposed to it for the reasons the hon. Member for Wakefield (Mary Creagh) has outlined, such as that it would leave them in the position of having to negotiate individually. The collective approach through the AWB provided them with a framework that enabled them to avoid considerable embarrassment and difficulty or having to buy-in human resources consultants to resolve things. My hon. Friend the Member for Westmorland and Lonsdale (Tim Farron) is right: few small-scale farmers employ agricultural workers, but those who do will encounter great difficulties if they have to negotiate these arrangements with their workers.
I have regularly worked with the NFU over many years, not least on the creation of the groceries code adjudicator, on which the Government must be warmly congratulated. I have worked with it on a wide range of issues, and often agree with it and stand shoulder to shoulder with it—but not, I am afraid, on this issue. Regrettably, on matters such as this the NFU tends to resort to becoming a large farmers’ union, rather than an all farmers’ union; I have accused it of that to its face, so I am not saying this behind its back.
Many pertinent issues have already been raised in our debate, and I shall not repeat the concerns expressed about the impact this move will have, and about the Government simply saying, “We have the national minimum wage, so we no longer need an AWB.”
Can the hon. Gentleman define for me what a large farm is? Is an intensively farmed three-acre poultry farm a large farm? Is a 200-acre dairy farm a large farm?
The hon. Gentleman might be drawing me into a different debate, but he knows about standard man days—I do not want that to be interpreted as a sexist term—and the number of jobs a holding generates, or requires in order to be maintained. That is calculated irrespective of the acres covered, because as his question implies, especially in less favoured areas—some of which fall within my constituency—there are geographically very large farms that have low productivity. As the hon. Gentleman rightly says, some farms that are small in acreage are intensively farmed and have high levels of productivity. He makes a good point, but the point I was making about larger farms was in the context of the fact that some—although admittedly very few—receive hundreds of thousands of pounds, or even over £1 million pounds, in public subsidy. He cannot deny that that is the case. Those sums are given to a very few large farms as a result of the arrangements through the single farm payment.
I regret finding myself in this position. I know the Minister of State, my hon. Friend the Member for Somerton and Frome (Mr Heath), has been handed a hospital pass with this issue since taking up his post, and I am enormously grateful to him for the work he is already doing through his conversations and meetings with people in the sector. Despite this regrettable decision, he is working with them to try to identify opportunities for voluntary agreements within the sector. I hope that will serve to provide some of the protections which I fear will be lost to agricultural workers as a result of this Government decision.
There is something further that I regret. Normally, I feel enormously disappointed by Opposition day debates, because they usually degenerate into rather tribal, finger-pointing and teasing events, in which it is not possible to take the Opposition line on an issue because of how the debate has been handled. I regret that on this occasion—partly as a result of how the Government have handled the matter so far, by not giving us an opportunity for a debate or a vote—after a considered debate, I will be voting against the Government in the Division.
The backdrop to this terrible and petty Government measure is the fact that real wages have fallen by £1,700 since this Government were elected. This is a Government who preach about making work pay, yet raise the national minimum wage by only 1.9% while consumer prices index inflation is at 2.8%. This is a living standards debate. Instead of raising standards for farm workers, the Government are engaging in a race to the bottom on pay and fair treatment.
The first early-day motion I ever tabled in this House —early-day motion 754, on 6 September 2010—was a motion opposing the Government’s then proposals to eradicate the AWB. I did it with the full support of the Labour party, because we on the Opposition Benches know that the AWB protects pay and conditions for 152,000 farm workers in England and Wales and is used as a benchmark for others employed in food manufacturing. Some 3,360 of those workers live in the north-east of England and 170 of them are in my constituency. Once the AWB is gone, 42,000 casual workers could see a drop in wages as soon as they finish their next job. The remaining 110,000 could see their wages eroded over time.
Let me ask the Minister straight out: why are the Government taking £260 million out of the rural economy in disposable income? That is how much will be lost in sick pay and holiday entitlement over a 10-year period. How do we know that? We know because the Department’s impact assessment tells us so. The loss to local businesses is not the only part of that cost, which also includes estimates for new HR costs and litigation for farming businesses that will no longer have the collective negotiating umbrella under which the whole labour market is regulated. Indeed, the last time an attempt was made to get rid of the AWB, even Baroness Thatcher had to U-turn. Not only did she U-turn, but the gravity of the deprivation that could have hurt hard-working people did not make economic or moral sense then, and it does not make economic or moral sense now. We believe that those people—often they do not own even 1 square foot of soil on the land—should at the very least be able to afford the food they grow on that land. The Government should be helping families across this nation to deal with rising living costs, not actively participating in driving down hard-working people’s pay—and all this from a Government who are doubling the nation’s debt in a five-year period, with accrual of debt outstripping any allegations of debt accrual against us over the 13 years of Labour governance.
That is the perverse backdrop against which the demolition of the AWB is juxtaposed—a demolition that saves virtually nothing in Treasury terms, but which will ultimately bestow a huge tragedy upon rural communities. I repeat: it is a policy that saves virtually nothing, while the Government are also, as we know, cavalierly forgoing more than £1 billion in revenue that could be used for investment or to pay off the debt they are accruing. Instead, that money is being sacrificed to give millionaires a cut in the top rate of tax. Those millionaires could use that tax rebate, stick it with the Government’s spare home subsidy and buy up the surplus housing stock in some rural communities. The Government have just shafted people on AWB pay and terms and conditions.
Farm workers work in all elements. They do tough, hard-working jobs, much like those in the steel industry that I know—hard labour, shifts and working outdoors. Those jobs lead to a far greater incidence of ill health. Farm workers on the lowest grade will lose between £150 and £264 in sick pay once the AWB is abolished. The Secretary of State disagreed and said it would continue, but that is as long as TUPE regulations exist, and that is worth about 90 days in the current currency. A new employee in that sector will not be grandfathered like previous workers but put on statutory minimums, and the Secretary of State knows that.
A quarter of the current work force covered by the AWB are over 55, and the change to sick pay damns those workers to the self-fulfilling perpetuation of grinding poverty that those on the Government Benches simply choose to ignore. Another point is just how exposed an individual is under the new terms. They will be negotiating their pay, terms and conditions while the AWB is being abolished. For example, if an individual is tied into accommodation, how will they be able or confident enough to raise the issue of sick pay or holidays without collective bargaining when their home is at stake? We are talking about real living standards. This is not some sort of arithmetical debate; these are real people who are going to suffer.
I have been listening carefully to the hon. Gentleman, but does he recognise that 41% of farm workers currently earn considerably more than the national minimum wage, as prescribed by the Agricultural Wages Board? That is a substantial difference. [Interruption.]
As my hon. Friend the Member for Llanelli (Nia Griffith) said from a sedentary position, that means that 59% of workers do not earn that. Therefore, 41% have enhanced terms because a statutory minimum is in place—the same principle as for the national minimum wage. It is a different sector, but 59% of people do not earn that and there is no guarantee about what direction their pay, terms and conditions will go in. In economic terms, for the agricultural sector, that is mad.
It is totally and utterly crazy to say that by undermining a statutory minimum at the bottom, pay will go up. That is just not the case, as the past 13 years of the Labour Government proved. The national minimum wage was put in place, but collective bargaining allowed enhancements to be brought in. If the floor is taken away, the floor goes through the floor—it goes lower and lower.
If the hon. Gentleman is so determined on the matter of the Agricultural Wages Board, why did the previous Labour Government not renew all other wages boards that were abolished under the Major Government?
I would take those on the Government Benches more seriously if—pardon my slight diversion, Madam Deputy Speaker—the Government were not giving the full pay reward to the Army. Armed forces were awarded a 1.5% pay increase. The Chancellor announced the increase in the Budget at the Dispatch Box, yet delayed the start of those payments until 1 May. That is unique in the private or public sector. I have never heard of that in the steel industry, or any other manufacturing industry in the private sector, yet the Government are doing that to the armed forces—I apologise, Madam Deputy Speaker.
Tied accommodation affects 30,300 farm workers and their families. Will Ministers at least guarantee that those properties will not be taken from under the noses of those workers, and potentially opened up to the new spare homes subsidy market so that millionaires can increase their property portfolios? This is a piece of despicable legislation, outdone only by the sheer cowardice of a Government who wish to pass this measure without attempting to justify one scintilla of it to the House in open debate.
I worked in the farming industry for 10 years and was involved in this debate when the issue was last discussed some 20 years ago—I will come back to that in a moment. It is worth noting—this has been alluded to by some, including the Secretary of State—that in the early ’90s, all other remaining wage councils and wages boards were scrapped. There was no rationale for them. Some 26 remained in about 1993, and all were abolished. Many covered sectors such as hotels, catering, retail, hairdressing and clothing manufacturing, but as the Secretary of State said, there were also some rather odd-looking boards such as those for the ostrich and fancy feather industry, or rope and net manufacturers. One has only to read lists of some of the industries to which the boards applied to realise that the whole concept is anachronistic and out of date.
I should have said that, like my hon. Friend, I too was an agricultural worker and worked on our farm. He says that the agricultural sector is the one sector that has been left alone, but it is also the sector into which the Gangmasters Licensing Authority was introduced, which demonstrates that it requires some underpinning with regulation.
Equally, we could say that the introduction of the Gangmasters Licensing Authority deals with some of the working conditions problems that Opposition Members have highlighted in a way that makes the AWB ever more redundant.
To return to the 1993 debate, the then Minister for Agriculture, Fisheries and Food, Gillian Shephard, held a consultation. A small number of us in the farming industry said that the AWB should go; that it was out of date and anachronistic; that farming should not be treated as a special case; and that the AWB read like something from the 1950s. It tended to be the larger, more forward-thinking farmers who took that view, led by a large salads company, the G’s group, which was run by Guy Shropshire. It was not one of my most successful campaigns. The Government had some 3,500 responses to the consultation, of which only 11 were in favour of abolition. I was one of those 11. That highlights the massive swing in opinion. Opposition Members have highlighted the current consultation, but 40% of people who responded to it have said that abolition is the right thing to do.
I want quickly to comment on a point before my hon. Friend moves on. Surely gangs now have that protection. They are totally different from the average farm worker in East Anglia, where very often someone is in charge of £500,000-worth of equipment and on a very high wage, on a farm that 40 years ago might have employed 40 people, but now employs two people who are highly skilled, very responsible and well paid.
My hon. Friend is right and underlines my point that the GLA has made the AWB ever more redundant. Those at the bottom on those low incomes have new protections.
One big thing in this debate compared with the last one—it is important to recognise this—is that the National Farmers Union is on the right side. For once, it is saying that we should get rid of the AWB because it is out of date. In 1993, the NFU let down its members. David Naish, the then president, supported the retention of the AWB, and he was wrong to do so. The NFU board of directors at the time was out of touch and behind the curve, but the NFU now recognises that things need to change and fully supports and endorses the abolition of the AWB. If even the NFU supports the abolition of the AWB, it is time to act. Another big change since 1993 is, as many hon. Members have said, the introduction of the minimum wage, which is yet another measure that makes the AWB out of date and no longer necessary.
How does the AWB frustrate rather than improve career development in the agricultural sector? The most important thing is the huge lack of flexibility. The board is based on old-style wage grade rates dating from the ’60s and ’70s, and completely ignores the fact that, in the most progressive farm businesses, many people are paid a salary and have management responsibilities. The best farm businesses have profit shares and payment by results. Piece rates are increasingly used when people earn far in excess of the minimum wage rates. Those modern day pay practices are completely ignored by the agricultural wages order, which can frustrate the development of more progressive pay policies in the farming industry and keep it trapped in a 1950s mindset.
I am following the hon. Gentleman’s argument closely, but cannot understand why anyone would want to do away with the minimum. He suggests that, in many sectors of the agriculture industry, people are highly skilled and receive higher remuneration than would be set as a minimum by the AWB, but why argue for its abolition if it does not affect those people? Surely the AWB protects a group of people who do not receive such higher remuneration.
The group of people the hon. Gentleman is concerned about are protected by the minimum wage. That is already there and is set at roughly the same level as a grade 1 agricultural worker, so I do not think that that is an argument at all. What I am saying is that being too rigid can actually frustrate the development of more progressive pay policies.
The other point, which the Secretary of State touched on earlier—we had this in our farm business where some of the work was in pack houses—is that someone could be running a conveyor belt packing strawberries one minute and working in the field the next, with totally different wages rates applying. We ran a farm shop, in which different rates applied, even though there were sometimes shared staff.
The hon. Gentleman states that this is a progressive pay policy. In the past 30 years, have a Conservative Government ever passed any legislation that has helped the working person, whether in terms of payment, work and conditions, or equality? Conservative Governments have never, ever advocated and voted for the rights of the working person.
I do not want this debate to get distracted, but even in the current Parliament the coalition Government have changed tax thresholds that help all working people, especially those on the lowest income.
Another problem with the rigid pay structure is that, as currently structured, it can discourage training and career development in small farm businesses. I will explain why. A small farmer might have two or three employees. He might not be able to afford to employ someone on grade 2, grade 3 or grade 4. He might not really have a need for those staff to be trained to those grades, but might nevertheless take the view that to aid the career development of a new employee—perhaps someone who has just left school and joined their business—he will give them time off work and support them in proficiency tests and training. At the moment, if they do that, the next thing that happens is that they suddenly have to pay that person more money. Is it not better if that person can develop and train, and has a farmer who wants to facilitate that, so that maybe, when a neighbouring farm needs somebody who has the proficiency test skills and a different type of skill set, they are able to progress and take a job that is higher paid in that neighbouring farm? The farmer will want that to happen; he will be happy to encourage somebody and see a career develop. At the moment, however, we are in a situation where the rigid grade structure discourages farmers from wanting to have their employees seek further training.
We have heard a lot in this debate, both from my hon. Friend the Member for St Ives (Andrew George) from my neighbouring constituency—we take different views on this, as people will have noticed—and others, about how difficult it is for farmers to negotiate with their staff, as if it is something that is dreadfully embarrassing and they cannot possibly do it. I reject that idea completely. Farmers, if they are still in business today, have to do all sorts of challenging things: they have to negotiate with people day in, day out; they have huge amounts of paperwork to deal with; and they have to negotiate and fight over the costs of their feeds, fuel bills and all sorts of things. The idea that they cannot sit down with the people they work with every day and have an intelligent conversation about their pay review is, frankly, ludicrous.
Farm businesses are no different from any other businesses. Even if they do not have to have discussions with their employees about pay rates, one can guarantee that there will still be times when they have to have discussions about people turning up for work late and staff who have problems at home and need some time off—all those sorts of issues. There is nothing different about farming. I was in the young farmers club in Cornwall with many of the farmers in my hon. Friend’s constituency. I know many of them and I can tell him that they are perfectly capable of having those conversations with their employees.
I endorse what my hon. Friend is saying. I, too, was a farmer in the 1990s, and know that farmers can easily negotiate. It is also important to recognise that agriculture today is a modern industry that is moving forward, with added value products, retail sectors and so on. All of that is happening to farms, so we cannot anchor them down to something as archaic as the AWB. It is not just a floor, but potentially a ceiling—something to which my hon. Friend has referred.
My hon. Friend makes an incredibly good point. Farming has changed.
The biggest farm employer in St Ives is a firm called Winchester Growers, which does not receive subsidies like the large farmers and tends to rent land and employ lots of people. Quite often, young men who would have had farms themselves become managers and supervisors within such businesses and have a proper career structure, with profit options, share options—all sorts of things. It is very important that we modernise and move on. The AWB is a relic of the past. It is full of “bosses versus workers” rhetoric that is frankly 40 years out of date. It is right that it should go.
I start by declaring an interest: as deputy general secretary of the old Transport and General Workers Union and then Unite, I represented agricultural workers for much of my working life, and was proud so to do.
I start by celebrating England’s green and pleasant land—our hills, our valleys, our forests, our farms, our rivers and our seashores, captured in that great hymn to the countryside, Linden Lea:
“Within the woodlands, flow’ry gladed,
By the oak tree’s mossy moot,
The shining grass-blades, timber-shaded,
Now do quiver under foot…
And brown-leaved fruits a-turning red,
In cloudless sunshine, overhead…
To where, for me, the apple tree
Do lean down low in Linden Lea.”
But elsewhere in that great hymn to the English countryside it reads:
“I don’t dread a peevish master;
Though no man may heed my frowns”.
That great hymn captured both the beauty of our countryside and another reality, which is that all too often the countryside has been scarred by the unfair treatment of workers and rural poverty. I have worked with farmers all my working life, so I am the first to acknowledge the changes in the industry and the many very good farming industry employers, but there remain to this day real problems.
The 19th century, from Tolpuddle onwards, was a century of struggle, with real progress being made in the 20th century, but before anyone argues today that exploitation in the countryside is a thing of the past, let me say this. I listened to the Prime Minister at Prime Minister’s Question Time speaking, and rightly so, about modern-day slavery. Some of the worst examples of slavery, historically and in the modern day, were practised by gangmasters, as was seen at its most obscene in the tragic death of 22 young Chinese cockle-pickers on the bleak, cold shores of Morecambe bay.
As a consequence of that incident, I chaired the coalition of support that brought the Gangmasters (Licensing) Act 2004 into law. It was a private Member’s Bill promoted by my hon. Friend the Member for Paisley and Renfrewshire North (Jim Sheridan). There was a remarkable coalition from plough to plate, from the National Farmers Union to the supermarkets. I shared platforms with Baroness Gillian Shepherd, and we stood together, arguing for a measure that was essential to tackle some of the most obscene practices in the world of work in our country. Sadly, now, we are seeing, on the one hand, the scaling back of the operation of the Gangmasters Licensing Authority and, on the other hand, the proposed abolition of the AWB.
It was Winston Churchill who first took action, as President of the Board of Trade, in 1908. He argued then that we needed fair treatment and to act to keep labour on the land. That was legislated for by the Attlee Government and championed by Harold Macmillan. That is 100 years of history now about to be torn up. I absolutely do not accept the argument that the Agricultural Wages Board is no longer relevant in modern times.
The hon. Gentleman obviously has a great deal of expertise, and I agree entirely with his points about the Gangmasters Licensing Authority. I supported that Bill, as did a number of my colleagues, when we were in opposition. After the war, many farmers employed perhaps 50 or 60 people on what would now be considered a smallish family farm, and there was of course a need for a trade union and for the Agricultural Wages Board. It would have been difficult for those farmers to negotiate with their farm workers without such a board. Now, however, those farmers employ a tiny number of people who are much better paid because of the relationship between the farmer and the workers which never existed in the past.
We have an atomised work force. There has been a progressive change in employment patterns from what was typically the case 50 years ago to smaller, more flexible work forces with a lot of contract labour and very few people being permanently employed on farms. Having said that, the statistics show that the majority of those covered by the AWB still need the minimum standards that the board lays down. I will come to that point in a moment.
I do not accept that the board is an historical anachronism—far from it—not least because half the work force is aged 55 and over and we still need to recruit and retain people to work on the land. Nor is it true to suggest that the board was set in aspic and never changed. Over the years, as a consequence of some very good dialogue, a modernisation process took place.
The proposal for the AWB’s abolition is fundamentally wrong for four reasons. The first involves fair treatment. This is not just about minimum standards. Crucially, it is also about other conditions of employment, which really matter. The simple reality is that the difference between the statutory arrangements and the board’s arrangements will be that, in future, it will be possible for a farmer to pay someone who is off sick £81.60 a week less. Farming is a dangerous occupation for some, and we often see high levels of sickness as a consequence of the work.
Secondly, abolishing the AWB is an inefficient way of proceeding. I asked the House of Commons Library to research the costs of the board, and I was surprised by the answer. I knew that it was lean and effective, but even I was surprised to learn that its administrative costs were £179,000 a year and its enforcement costs were £150,000. That fully functioning Agricultural Wages Board therefore cost a grand total of £329,000.
Now, however, we shall see tens of thousands of negotiations taking place throughout the agriculture sector. I accept that, depending on the nature of the employment pattern, people can often get paid more than the level strictly laid down by the AWB. That happens all the time, as a result of a demand for a particular skill. However, the hon. Member for St Ives (Andrew George) was right to say that, other than in circumstances of exceptional demand, it is convenient for farmers to use the framework laid down by the board. Farmers have said that to me, too. In future, however, we shall see negotiation after negotiation consuming the time and effort of our farmers.
My hon. Friend the Member for Camborne and Redruth (George Eustice) suggested earlier that farmers were used to sitting down and negotiating with suppliers of feed, seeds and so on, but there is of course a framework involved in those cases as well, and those farmers know what the framework is when they commence their negotiations. If there is a total free-for-all, we run the risk of creating a race to the bottom.
The hon. Gentleman is absolutely right to be concerned about a race to the bottom. There are tens of millions of people on the continent who are desperate for work, and the last thing we want to see as a consequence of these proposals is a race to the bottom. My experience suggests that even where farmers depart from the AWB rates of pay—and they often do—it is helpful to have a clear framework and starting point, varied as appropriate in particular circumstances, depending on the skill level required, for example. Something very similar to that was put to me.
My third concern is the impact on local economies. There is no question but that we run the risk of taking out badly needed spending power from our hard-pressed local economies. It is interesting to note the Department’s impact assessment of the costs over a 10-year period: £260 million was, I think, the figure referred to.
Fourthly, we have heard time and again that “other wages councils have been abolished, have they not, and have not been reinstated”. This board is, however, unique in terms of its scope—including, crucially, the issue of tied accommodation. I repeat what my hon. Friend the Member for Wakefield (Mary Creagh) said earlier about the criteria: fit for human habitation, safe and secure, a bed for sole use, drinking water and sanitation. Some might say that all that sounds a bit 19th century, particularly the idea of a bed for one’s own use. They would not say that if they had seen the sort of places I saw when I was deputy general secretary of the old T and G and then of Unite. I saw some of the most shameful accommodation—and not just for those employed by gangmasters, as it was sometimes for those employed by farmers. The great thing about the Agricultural Wages Board is that it lays down very clear basic minimum standards for the kind of accommodation that I hope we would all like to see agricultural workers occupying in our countryside.
I am most grateful, particularly as I was not able to be here for the opening speeches. I agree with the hon. Gentleman about rural poverty, and I strongly support the Gangmasters Licensing Authority, as I campaigned for its existence and it is doing great work in my constituency. In a genuine spirit of curiosity, I ask the hon. Gentleman whether he is saying that farmers are uniquely incapable or uniquely exploitative so that they alone require the Agricultural Wages Board to regulate their behaviour, while every other boss in Britain does not. Is that what he is saying?
The board was born out of the experience of the agricultural economies. I have already said that, mercifully, our country has many good farmers who are dealing with changing patterns of mechanisation, the demand for greater skill levels and so forth. Pretending, however, that the exploitation of agricultural workers in the past is somehow simply a problem of the past and not still a problem to this day is not to live in the real world that I have lived in for many years.
Winston Churchill must be turning in his grave. Dare I say it, the two parties of which he was a member have come together to abolish the Agricultural Wages Board for which he laid the path. The Prime Minister has said, after all, that he is proud to be a member of the union—not the Transport and General Workers Union or Unite, but the National Farmers Union. His position, then, is not surprising. It is astonishing, however, that the Minister of State, Department for Environment, Food and Rural Affairs, the hon. Member for Somerton and Frome (Mr Heath), who has talked in recent years—not 50 or 100 years ago—about the need not to impoverish the rural working class should now, presumably following a Damascene conversion, talk about the need to get rid of the Agricultural Wages Board as a burdensome anomaly. Perhaps he will explain later how he squares those statements.
In conclusion, this issue is above all about what is in the best interests of the countryside. The question we need to ask ourselves is what kind of country and what kind of countryside we want to live in. I could put it no better than the hon. Member for St Ives did when he spoke earlier about the meaning of us all being “in it together” in circumstances where a £1 million cheque can go to a big farmer on the one hand, while the Agricultural Wages Board is abolished on the other hand. That is why we are unashamedly standing up for the best traditions of our country and the best traditions of our countryside—and the best traditions of our countryside are best served by a fair deal for our countryside.
Several hon. Members
Order. I remind the House that the debate is time-limited, and must end at 5.47 pm. It will be necessary to draw it to a conclusion at about 5.27 pm in order to allow the Front Benchers to respond.
I ask Members to curtail their remarks to eight minutes—which will include interventions on their speeches—because otherwise not everyone who wishes to speak will be able to do so. I ask those who are intervening repeatedly, and who may have already spoken, to exercise a bit of discipline. I ask those who do not plan to speak to restrain from intervening out of respect for those who are still to speak. I remind those who are still to speak that they do not have to give way. It will then be possible to accommodate everyone who has sat patiently through the debate thus far.
I am grateful for that guidance, Madam Deputy Speaker. Let me begin by drawing the House’s attention to my declaration in the Register of Members’ Financial Interests.
We should recognise the progress that agriculture has made over the last 70 years. We are now well fed as a nation, without the worry of food security. We should recognise what a good job agriculture, agricultural workers and farmers have done in feeding the whole of Europe during those 70 years since the second world war, and, when we compare the industry of today with agriculture in the 1940s, we should recognise how different it is now, and how different are the relationships of agricultural staff with their employers.
The first argument that we heard from the Opposition—that abolishing the Agricultural Wages Board would not save any money—wholly missed the point of the debate. This is not about saving cash for the Government; it is about recognising the changing dynamic of agricultural work in the United Kingdom in a modern setting, and recognising the safeguards that have been introduced by other Governments and other parties. The minimum wage established a floor for the wages of all workers and has given them wage security, while changes in the legislation governing gangmasters have protected agricultural workers who are employed by them. The Agricultural Wages Board has become redundant. It is no longer a necessity because there are other safeguards, irrespective of the changes in the dynamic of agriculture.
Let me draw a few comparisons. If an agricultural worker who is charged with the responsibility of driving quarter of a million pounds’ worth of combine harvester makes a mistake in setting the sieves, much of the crop may go over the back of the combine. For the farmer, it is vital that the right member of staff, with the right skills, is sitting in that seat to protect his crop. I do not understand why a warehouse worker driving a forklift truck for Amazon does not need extra protection, but the combine harvester driver does.
A potato harvester can probably harvest £50,000 worth of crop, so damage to just 10% of that crop could cost a farm business £5,000 a day. Again, for the farmer it is vital that the right member of staff is driving that tractor and helping to ensure that the business is well looked after. If the right member of staff with the right skills is to sit on that seat, the farmer must pay him the right amount. The farmer must give him the right terms and conditions, or else he will walk off to another farmer.
The market for skills of that kind is driving agricultural wages to a much higher level than was provided for by the Agricultural Wages Board. Agriculture as an industry has changed dramatically since the 1960s. The House must recognise that.
Another argument we heard was that agricultural workers are particularly vulnerable because they live in tied cottages. I do not understand why the Opposition do not make the same argument for public house managers who work for a brewery and whose home is the public house itself. Why do they not require the extra protection farm workers supposedly have from the Agricultural Wages Board? The manager of a post office often has a flat above the business. Their accommodation is tied, so why do they not require extra protection? Double standards are in play.
Agriculture has moved on. The key question is whether the Opposition would overturn the abolition if they were in power. They were challenged on that point several times during the debate and on three occasions they refused the opportunity to answer. There is some cynicism on the Government Benches. Is it a political game? Is it about making a political point rather than a genuine one about improving the lot of people working in rural communities?
As a number of speakers want to follow me, I shall keep my comments as short as possible. I hope that in summing up, the Opposition speaker will address some of the points I made.
I am pleased to take part in the debate. I have a constituency interest, and I led for the Opposition in the Committee on the Public Bodies Bill, so it is a matter of some disappointment to me that in the intervening two years the Government have not refined their arguments, nor have they produced further evidence to suggest why the board should be abolished. Given the catastrophic effect abolition could have on the pay, terms and conditions of the country’s 152,000 agricultural workers, not least in my constituency, where well over 100 workers will be affected, it is important to ask serious questions of the Government about why they consider it necessary and, in particular, whose interests they are serving.
As we have heard, the Agricultural Wages Board was formed in 1948, but its lineage goes back to 1924. The fact that it has survived so long is testament to its continuing relevance. My hon. Friend the Member for Birmingham, Erdington (Jack Dromey) is right: it has modernised over the years and could modernise further. The board has demonstrated its importance for protecting the rights of workers in the sector. Those rights are now very much at risk.
The Government’s response when asked why they want to abolish the AWB is that agricultural workers, like others, are now covered by minimum wage legislation. Excellent though the minimum wage legislation is, it does not cover the same range of wage levels and categories as the AWB. The agricultural industry needs to attract people with the right skills and aptitude, which is becoming more important as farming methods continue to develop technologically. The AWB has a grading system for the terms and conditions of employment for agricultural workers that reflects the diversity of skills needed and the responsibilities attached. As many others have said, minimum wage legislation does not cover the many other areas overseen by the AWB, such as the standard of tied accommodation, overtime rates, sick pay and holiday entitlement. Why are the Government abolishing the board, and in whose interests will it be?
When the Public Bodies Bill was being considered in Committee, far from Labour Members being out of line, as the hon. Member for Carmarthen West and South Pembrokeshire (Simon Hart) suggested, it was Government Members who were out of line, because the only people supporting abolition were some parts of the National Farmers Union. Indeed, it was only some in the union. We received many representations from farmers and farm workers who thought that getting rid of the AWB was an extremely bad idea because they liked the structure that it gave to negotiations.
We know that the abolition is not in the interests of not only hard-pressed agricultural workers, who stand to lose significantly from the change, but those wishing to enter the sector. I have a very good agricultural and horticultural training college in my constituency. From talking to several of the young people studying at Houghall, I know that they are worried about what will happen to terms and conditions in the sector following the abolition of the AWB. They are also concerned that they will no longer have a clear career ladder after leaving college, yet no Government Member has addressed that problem. We know from Lantra, the skills body overseeing the sector, that another 60,000 people will soon be needed in the industry because 25% of agricultural workers are over 55. Ministers cannot seriously be suggesting that the abolition of the board will make the industry more attractive to young people, because they have told me directly that it will not.
The abolition is not in the interests of the rural economy as a whole, especially in the north-east, given that millions of pounds will be taken out of an economy that is already suffering from high unemployment. The Government’s policies have hit my constituency hard. The latest unemployment figures show that City of Durham’s claimant rate has almost doubled in the past 12 months, which is one of the biggest rises in the country. It will be difficult for people in the agricultural sector to argue for a better standard of living when unemployment is so high, because they will be told, “If you don’t like it, lump it, because there are lots of people in the county who will be able to take your job.” The Government simply are not addressing that problem, yet because the abolition of the board will remove workers’ protections, it will be more difficult for them to argue for a better standard of living.
I will conclude, because I want to give others time to speak, but it is difficult to understand what the abolition of the board will achieve. It does not cost much to operate, but it protects workers in the sector, and sets a clear framework for negotiations and a career structure. It could be modernised in line with the new skills needed for farming, but one can only assume that the Government, as they have shown with other policies, are hellbent on driving down the wages of the low-paid in this country while at the same time giving tax cuts to millionaires.
I am proud to say that I still consider myself to be very much part of the farming community. I was saddened by the way in which the shadow Secretary of State tried to portray farming and farmers. I took part in a debate on Radio Devon after she had made a statement in which she went on at great length about things such as gangmasters, as if to suggest that every farmer was a terrible employer, but I do not recognise that situation in Devon or across the farming sector.
I am saddened by how the debate has proceeded. Some 40-odd years ago, I left school at the age of 16 to milk cows. I started on a farm of 50 acres. With the help of NatWest bank, which charged me enormous sums for the privilege, I managed to build up the farm to about 250 acres. During that period, we sometimes employed people, while at other times we did all the work ourselves.
Farming and the farming community have changed so much. Many hon. Members have made the case that farm workers are extremely valuable because of the type of farming that we carry out. In dairy farming, the milking parlours are equipped with computers which determine, for example, the amount of feed that the animals have. In the poultry industry, the buildings are temperature-controlled and farmers must make sure that the poultry are fit and free from disease. The same applies in the pig and sheep industries. The entire farming industry has changed hugely. When one gets on to a tractor, it lights up like a Christmas tree because there is so much computer equipment in it, reflecting the fact that it is difficult to operate. Of course we value the farm workers who operate all that equipment.
The farming industry is progressing. Reference was made to the green and pleasant land that we all live in and the good, healthy food that we are fortunate to have in this country. Who produces it? The farmers and the farm workers. We produce it together and I am proud to be part of that industry. I am sick to death of this debate, which is all about the long history of the Agricultural Wages Board and from where it started. I would be the first to admit that there was every good reason for it in those days, but now we have minimum wage legislation and an industry that has moved on. We want agriculture to be competitive and to move forward and employ more people on higher wages. We want a much more efficient industry.
I believe there is a bright future for agriculture. All the Agricultural Wages Board does is hark back to a past that we want to leave behind. It is right for us to take these decisions. The figures that we have show that more than 90% of agricultural workers are, fortunately, paid above the minimum wage, and we welcome that fact. During the debate, the sheer negativity from the Opposition has upset me. I would take their move to defend the Agricultural Wages Board much more seriously if they had replied to the question—they have been challenged three times on this—of whether they would make retention of the AWB a priority of the next Labour Government if this country were mad enough to put them back into power. I will therefore reply for them. They are not going to replace it. That is certain.
All the Opposition are here for today is to play politics and try to portray the farming community as terrible Victorian employers. We certainly are not. I say “we” because I consider myself still part of that farming community. I do not recognise the farming community painted by the Opposition. I find it offensive—I will be blunt about it—to be portrayed in that way. We do not employ people on poor wages. We want to progress people. During my farming career I had quite a number of young people who came and worked on the farm. We trained them, they moved on to other jobs and I am proud of that.
Let us not make this a debate about class warfare, with terrible rich landowners who are out there exploiting the workers. That is not what the debate is about. It should be about whether the Agricultural Wages Board is necessary. I do not believe it is. Why is it the only wages board left? It was left originally because there was no minimum wage legislation, but since that legislation has come in, there is no need for it. Hon. Members are worried that farmers and farm workers who have such responsible jobs on the modern farm cannot sit down with one another and negotiate their own wage rates. Surely hon. Members know that that is possible and that it will happen in the real world.
We have already abolished the Agricultural Wages Board, but I will be voting against the motion, which seeks to reinstate it, because I know full well that it will not be reinstated. It is a political ploy on the part of the Opposition to have a little debate. I end by reiterating, for the third time, how offended I am by the way in which the farming community has been portrayed this afternoon.
Ministers have still not convinced me about why they want to abolish the Agricultural Wages Board. If they are so convinced that agricultural wages will not go down, why are they so determined to abolish it? Why should it matter to them if it continues to exist and people continue to be paid at the rates it sets?
DEFRA’s own assessment has calculated that abolishing the AWB will take £260 million out of the rural economy over the next 10 years. That can mean only one thing: the 80% of agricultural workers who are on grades 2 to 6 will be vulnerable to having their pay driven down to minimum wage levels, regardless of the skills involved, not to mention the antisocial hours and the need to be out in all weather, using complex machinery, but still getting wet and dirty. Of course, that means less money in the rural economy, with a knock-on effect for the village shop and others employed locally.
We talk about fair trade for developing countries and getting a fair price for their products so that their farming communities can get reasonable rewards for their efforts. After much campaigning by Opposition Members, and indeed the hon. Member for St Ives (Andrew George), the Government have agreed to give the groceries code adjudicator some teeth, which is an important step towards tackling exploitation and giving farmers a fair price for their produce. However, it is equally important to ensure that the workers who harvest that produce are fairly remunerated, and the AWB has a vital role in protecting agricultural workers.
In other words, it is not enough that the groceries code adjudicator ensures that the supermarket does not exploit the farmer; the AWB’s conditions also ensure that the farmer does not exploit the worker. That is particularly important because, as a response to the Macdonald report, the Government are now threatening to reduce the impact of the Gangmasters Licensing Authority, whereas we would like to see its remit extended to cover sectors such as care homes and construction.
As my right hon. Friend the Member for Delyn (Mr Hanson) said, the Farmers Union of Wales is firmly opposed to the abolition of the AWB. I find it quite insulting that the hon. Member for Carmarthen West and South Pembrokeshire (Simon Hart) seems to have completely ignored what the FUW has on its website and what it has repeatedly said when it has come to see us.
What I actually said was that the members of that union in my constituency who have approached me take a different view.
Well, farmers in general want to be fair to their staff, and I would certainly say to the hon. Member for Tiverton and Honiton (Neil Parish) that the good guys do not need the legislation, but legislation is necessary for those who do try to exploit people and who do not necessarily play by the rules. As I have said, most farmers want to be fair.
Many farmers in areas such as rural Wales are both employer and employee, because they often work on contract for other farmers. They might sometimes employ agricultural workers, but they or members of their family might also be employed as agricultural workers. They have said themselves that it is not about being unable to set pay rates, but that it is far simpler and fairer in a rural community to say that everyone will go by the same rate. That is the importance of the AWB, and that is exactly what the FUW has been telling us.
Of course, it is not just about a minimum wage, because there are all the other things that the AWB sets, such as allowances for night work and being on stand-by, bereavement, sick leave, holiday entitlement and the rates for under-16s, none of which are covered by the national minimum wage legislation. In a rural community there are few alternative job opportunities and it is difficult for agricultural workers to find alternative employment. The cost of living is often higher because of the higher costs of transport and fewer opportunities to shop around for cheaper deals.
Those who rely on their employer for accommodation are even more vulnerable. There is often no alternative accommodation in rural areas, and the AWB plays a vital role in setting maximum charges for accommodation and minimum standards of sanitation, and in making sure that each worker has their own bed to sleep in.
What will happen when casual workers start their next job and find that the going rate is less? For many of them that will mean that their households incomes fall, so more families will become more reliant on higher levels of tax credit, which will not be good for the public purse. It would be far better to make sure that they had the proper rate of pay for their work and a proper wage from their employer, so that they could be less reliant on handouts.
This is part of a seemingly much wider attack by the Government. I regret that the legislation to abolish the AWB is being passed in such an unpleasant way and by the back door, when the Welsh Government made a very strong case to keep it in Wales when it was part of the Public Bodies Bill, not the Enterprise and Regulatory Reform Bill. This has done a terrible disservice to our rural communities.
I support the Opposition motion to resist the abolition of the Agricultural Wages Board. Government Members have accused us of waging class war, but this is an issue of social justice and if that means that it is also an issue of class, I make no apology.
My hon. Friend the Member for Birmingham, Erdington (Jack Dromey) quoted Winston Churchill, who, amazingly, has been quoted three or four times by some surprising sources in this place over the past couple of weeks. I looked up Mr Churchill’s quote, and hon. Members might be interested to know that he spoke in class terms:
“It is a serious national evil that any class of His Majesty’s subjects should receive less than a living wage in return for their utmost exertions…where you have what we call sweated trades”.
There are no bankers or accountants present on the Government Benches, but there are some farmers and others associated with the industry. They will know what sweated trades are, so I do not need to explain that to them. On sweated trades, Churchill said that
“you have no organisation, no parity of bargaining, the good employer is undercut by the bad, and the bad employer is undercut by the worst…where those conditions prevail you have not a condition of progress, but a condition of progressive degeneration.”—[Official Report, 28 April 1909; Vol. 4, c. 388.]
That was Winston Churchill arguing for the establishment of the Agricultural Wages Board, so who am I, as a socialist, to argue with Winston Churchill? He was absolutely right.
In his excellent speech the hon. Member for St Ives (Andrew George) spoke of how the industry has developed and how farming has morphed into large agri-businesses and the food trade has gone global, and how that has put particular pressures on rural workers.
We on the Opposition Benches are concerned that the living standards for rural workers will go backwards. It is scandalous that last week we were not even afforded the courtesy of a debate, let alone a vote. The Government should think a thousand shames that they whisked through their plans to not just dismantle, but to abolish the AWB. It was disgraceful that Parliament was disregarded by a Government in a hurry to sweep away 100 years of workers’ rights and a century of consensus on rural living wages and housing standards.
Members keep asking why those rights should apply to rural workers and not to other groups of workers. As we have heard from a number of Members, the answer relates to tied accommodation, training and compassionate leave. The provisions also apply to workers who have to have dogs, presumably for sheep farming, so the AWB is different and there is a strong case for retaining it.
We saw just this week in The Sunday Times rich list that there is still massive personal wealth in the United Kingdom. Among those who are doing the best and who are luxuriating in extreme largesse are a number of UK food manufacturers—not large farmers—including Morrisons, Sainsbury’s and 2 Sisters, which is one of the biggest food processing companies in Europe. At No. 80 in the rich list is Lord Vestey, the owner of Stowell Park, which is one of the businesses that lobbied for the abolition of the Agricultural Wages Board.
Government Members accuse Labour Members of arguing the case of the trade unions. I am a proud member of Unite the Union and make no apology for that. If standing up for agricultural workers is a sin, I am guilty and unrepentant. However, it is also clear who is behind the abolition of the Agricultural Wages Board. It is the big businesses that are tightening their grip on the food industry that lobbied for its abolition.
The abolition will affect 150,000 people in England and Wales and about 5,500 agricultural workers in my region. I have discovered that 55 families in my constituency will be affected. We have heard about the history of the establishment of the Agricultural Wages Board, so I will not rehearse it.
I was intrigued when my right hon. Friend the Member for Delyn (Mr Hanson) mentioned that the Minister of State, Department for Environment, Food and Rural Affairs, the hon. Member for Somerton and Frome (Mr Heath), used to be a vociferous supporter of the retention of the Agricultural Wages Board. Early-day motion 892 of the 1999 to 2000 Session, which he supported, stated that
“any weakening of the Agricultural Wages Board or its abolition would further impoverish the rural working class, exacerbating social deprivation and the undesirable indicators associated with social exclusion”.
What has changed? Is it that the AWB is outdated and bureaucratic? Have the conditions of agricultural workers changed so much that we do not need it? I do not think that that is the case.
The third of agricultural workers who live in tied accommodation will no longer be protected by a cap on the amount that their employers can charge them for accommodation. They would risk losing their homes if they rejected downgraded contracts. That implication of the abolition was raised with me by an agricultural worker. We have also heard that the abolition will potentially cost agricultural workers £260 million in lost sick pay and holiday pay over the next 10 years.
Although the Government’s mantra is that they want to make work pay, the abolition of the Agricultural Wages Board will lead to a race to the bottom in wages and terms and conditions for agricultural workers, and will therefore make work pay less. If wage protections are abolished, agricultural workers will see their terms and conditions squeezed. Nobody is tarring all farmers with the brush of being unscrupulous employers and my hon. Friend the Member for Birmingham, Erdington was at pains to point out that many of the farmers he came across were very good employers, but there will be some who pass the pressure from the supermarkets on to their workers. That is a real concern.
Costs are much higher in rural areas than in urban areas. The Joseph Rowntree Foundation found in 2010 that people living in rural areas spent between 10% and 20% more on everyday needs than those in urban areas. The Office for National Statistics estimates that the weekly spending of rural households is more than £50 higher than that of urban households, which must be a problem for a rural workers.
It would not have been acceptable not to have a debate, and it is not acceptable for the Government to ignore the outcome of the consultation; let us put it on the record that it indicated that the board should be retained. They are facilitating the redistribution of income away from some of the most vulnerable workers in the land to some of the wealthiest private individuals in the land. That is why the Opposition motion and the debate are to be welcomed.
I ask the Government to show the same care and attention to the living standards and wages of the poorest as they have to the richest 1%, who are now enjoying a top rate tax cut. If they wanted to protect the living standards and wages of the poorest in society, they could make a good start today by not abolishing the Agricultural Wages Board and by allowing trade unions, employers and independent representatives to continue to negotiate fair terms and conditions for vulnerable workers.
On occasions such as this, at the closing of a debate, we often hear words about what a fine debate it has been, what eloquent testimony Members have given and what a fine day it is for Parliament. There have indeed been some very fine contributions today, from both sides of the House, and I will return to some of them in a moment.
Today, however, I have to say that this is not a shining occasion for Parliament. Far from it. It is a disgrace that the Government seem to have been dragged kicking and screaming into the sunlight to debate an issue that they seem to want hidden from democratic oversight. That is no fault of yours, Mr Deputy Speaker, but entirely the fault of Ministers. The attempts to curtail debate, or even to bypass the elected House of Commons and the democratic will of the Government in Wales on the matter, have been shameful and truly desperate.
Today, the views of parliamentarians, including Members representing rural areas, will be revealed to their constituents through both the debate and the vote. Their views will be revealed on stripping away the protections of 152,000 workers in England and Wales—protections on pay scales and accommodation; sick pay, holiday pay and overtime; caps on charges for tied accommodation; protections for children under 16 working in the fields; and the simple and basic entitlement of an agricultural worker in a team of workers at the end of a long shift to their own bed—their own bed, for goodness’ sake. The Minister of State has argued that the national minimum wage has changed all that, but he knows that it was in place before he signed an early-day motion warning that the abolition of the AWB would
“impoverish the rural working class”.
We are now in the most preposterous situation. A Liberal Democrat Minister is working, I suspect—he will clarify this—against his own long-held and principled position; against the views and interests of more than 1,000 workers and their families in his constituency, many of whom will have lobbied him in recent weeks and months,; against the views of many smaller, hard-pressed farmers who see the abolition as an increase in complexity in wage negotiations; against the views of the Liberal Democrat lead on rural and environmental issues in Parliament, the hon. Member for St Ives (Andrew George), which prompts the question: will the real Lib Dems please step forward?; and in favour of an ideology that could well be one of “beggar the hindmost”.
I have been chairing a meeting of the Environment, Food and Rural Affairs Committee this afternoon.
I apparently have the largest number of agricultural workers in my constituency, and not many of them have contacted me on this matter. I do not think more than three have done so. Where is the hon. Gentleman getting his information from?
The hon. Lady says she has been contacted by just three, but three is three, and I know for a fact that a large number of Members—many of whom are, for understandable reasons, not present for this debate, but who will, I assume, be passing through the voting Lobby—have been extensively lobbied by agricultural workers in their communities. The question is this: how will they vote today?
In the midst of the economic gloom of Osbornomics—that is a commentators’ phrase—with the economy flat-lining and the rural economy suffering too, the Government’s own figures show that more than a quarter of a billion pounds could be taken out of the rural economy following abolition of the AWB, and as my hon. Friend the Member for Wakefield (Mary Creagh) pointed out, we could well add to the burden by increasing rural poverty and the in-work benefits bill to the taxpayer. This is, indeed, the world turned upside down.
My hon. Friend is making a powerful case. Members on the Government Benches have asked what Labour would do when in power in 2015. I know how difficult it will be to pick up the pieces of this appalling mess, but would my hon. Friend care to comment on that?
I welcome the opportunity to do so, because it has wrongly been said that we have already made up our mind not to re-establish the AWB. When the AWB is abolished, it will, in effect, be shattered into little pieces. Its mechanisms will be entirely taken away, but I will tell my hon. Friend what we will do: Labour has already made clear its proposals under the Fair Work Commission—which I hope Members on the Government Benches will support, even though they opposed the work of the Low Pay Commission, which resulted in the national minimum wage, which they have been praising today. There will be a new commission that will consider our emerging proposals on the rural living wage, extending the remit of gangmaster legislation and tackling the agency workers question, and thereby addressing the undercutting of pay and conditions in local areas. That will no doubt be the arena in which our response to the abolition of the AWB will be developed. I suspect—in fact I can guarantee—that the Government parties will not be carrying out any similar piece of work. [Interruption.]
Any pretensions to respect—[Interruption.] I think Government Members want to know whether we would put the egg together again after they have broken it into a thousand pieces. I hope they understand from what I have just said that many of the proposals we already have in relation to the Fair Pay Commission run completely contrary to the free market, deregulatory ideology, and therefore both the Conservative Secretary of State and the Liberal Democrat Minister would oppose them, but I suspect many of the Minister’s Liberal Democrat friends would support them.
Any pretensions of respect for the views of this democratically elected House and the Welsh Government were ripped apart by this coalition Government when they sought at every opportunity to bypass votes and debate in this House. This proposal should have been taken through in full in what was then the Public Bodies Bill, and then brought back here and fully debated at length in this Chamber—and the issue of the legitimate right of the Welsh Government to be heard should also have been discussed. Instead, the proposal was rushed through a pitiful four-week consultation after the new Secretary of State arrived in post. The majority of respondents to that consultation in England and Wales opposed the abolition of the AWB, but that was ignored.
The proposal was then snuck into Committee in the other place in a different Bill, the Enterprise and Regulatory Reform Bill, which had already left the Commons, thus avoiding the need for any awkward debate here. After heated exchanges, and opposition from bishops, Labour peers and some Cross Benchers, the Lords eventually supported the abolition. When the proposal returned to this House as Lords amendments, we were denied the time and the opportunity to debate it or even to vote on it. So here we are today, in a debate brought by the Labour Opposition.
As we debate this matter today, therefore, the Government have conspired to abolish the AWB through the unelected House of Lords. [Interruption.] The Secretary of State for Education says “Hear, hear.” He may regard democratically elected representatives so lightly, but we do not; we like to have a say on behalf of our rural, and other, constituents. I ask the Government to think again.
I appeal to all parliamentarians who support the abolition to think again. My right hon. Friend the Member for Delyn (Mr Hanson) appealed to Unionist Conservatives who are concerned about taking a cross-England and Wales approach and about cross-border issues to maintain the AWB. In no way is the hon. Member for St Ives somehow in hoc with union paymasters—contrary to the allegations that have been made against Members this afternoon—or acting at someone else’s behest. He speaks independently as the lead voice for the Liberal Democrat party, as opposed to the Minister, on rural issues. On that basis, what we are seeing is quite fascinating.
My hon. Friend the Member for Middlesbrough South and East Cleveland (Tom Blenkinsop) called this a living standards debate. He is quite right. He said the proposal did not make economic or moral sense in the 1980s, under former Prime Minister Thatcher, and it does not make sense now either. My hon. Friend the Member for Birmingham, Erdington (Jack Dromey) brought some poetry and morality to the debate. He raised the real alternative to abolition, which is further modernisation, which has happened before—a point made also by my hon. Friend the Member for City of Durham (Roberta Blackman-Woods)—and asked the fundamental question: what type of countryside do we want?
My hon. Friend the Member for Llanelli (Nia Griffith) said that fairness was about not just the groceries code adjudicator, but fair pay and conditions. My hon. Friend the Member for Easington (Grahame M. Morris) cited Churchill in defence of the Agricultural Wages Board. As we noted earlier in the debate, even former Prime Minister Thatcher stayed away from abolishing the AWB. There were also great contributions from my hon. Friend the Member for North West Durham (Pat Glass), the hon. Member for Carmarthen West and South Pembrokeshire (Simon Hart) and others.
I appeal to all those Lib Dem parliamentarians who long held this as a point of principle and who have been lobbied by their constituents. They should stand with their constituents and with us, support low-paid workers and smaller farmers and stand against rural poverty. I appeal to Conservative MPs who want to speak up for all their constituents, small farmers as well as large, low-paid as well as wealthy. They should be compassionate, one nation Tories, not just the representatives of the wealthy and the powerful in the countryside. If I cannot appeal to their better nature, let me appeal to their baser political instinct—not least those whose parliamentary majorities are smaller than the number of agricultural workers in the constituencies affected, such as the hon. Members for Sherwood (Mr Spencer) and for Camborne and Redruth (George Eustice), and many others.
I am glad we have had this debate. Some have commented that it is like closing the stable door after the horse has bolted. That is no fault of ours, but when the vote comes, people will see where Members stand on a fair rural community, fair wages and fair conditions for everyone.
The hon. Member for Carmarthen West and South Pembrokeshire (Simon Hart) did the House a service by pointing out the disparity between last night’s excellent debate in the name of the hon. Member for Montgomeryshire (Glyn Davies)—in which we heard contributions from all parts of the House, from Members who knew rural areas, knew the agricultural industry, were deeply committed to it and understood what the implications were—and today’s debate, which sadly has on occasions fallen short of that ideal.
That is not to say that there are not Members present who very much understand rural areas and represent their constituents, but that is not how I would characterise the opening speech from the hon. Member for Wakefield (Mary Creagh), representing Islington Labour and its deeply patronising view of what happens in rural areas and the capabilities of people who work in rural areas. I resent that in the same way that the hon. Member for Tiverton and Honiton (Neil Parish) did. However, we welcome the fact that the hon. Lady has finally returned to the Chamber to hear the conclusion, if not the substance, of the debate that she called.
Let us deal with the issues raised, the first of which is the lack of debate on this issue. I am extremely sorry: I regret that there have not been debates on the precise motions that came from the other place last week. However, to say that there has been no debate on the issue is nonsense. Over the last three years I have debated this subject for hours with Members represented in this debate. We have had endless debates on a subject on which everybody knew every side of the argument, so that claim is nonsense. We could even have addressed it—I say this to my hon. Friend the Member for St Ives (Andrew George), who made the point of order—when we had the debate on the Lords amendments the other day. Indeed, had the shadow Business Secretary, the hon. Member for Streatham (Mr Umunna)—whom we are always glad to see in this country from his clubbing expeditions abroad—decided that this issue needed to be debated, as colleagues say it does, he could have done so. There was time to debate it but he chose to make speeches on other subjects instead. That is why we had no debate.
The hon. Member for North West Durham (Pat Glass) said that there was no meaningful consultation and that we did not notify people. I sent 13,000 letters to every single person or organisation covered by the order on agricultural wages, explaining what was to be done and asking for comments. That is unprecedented. It did not happen under the Labour Government but we did it because we wanted to ensure that people had the opportunity to respond.
The issue of Wales was raised. Let me let the House into a secret: I did not produce the legislation that provided for the devolution settlement in Wales, and Labour’s devolution settlement did not devolve employment issues to the Welsh Assembly Government. That is why such matters remain an issue for this House and this Government. No amount of argument from Welsh Ministers will change that settlement, only a change in the statutory format for the devolution settlement, which I do not believe the Labour party supports.
Let us consider the substance of this case, which is the crux of the matter.
Will the Minister give way?
I will because the hon. Gentleman has some knowledge on this subject and I therefore welcome his views.
Will the Minister tell the House at what point and why he moved from believing that the abolition of the Agricultural Wages Board would
“impoverish the rural working class”
to his current position of saying that it must be abolished as it is a “burdensome anomaly”?
There were a number of points. There was the introduction of the Part-time Workers (Prevention of Less Favourable Treatment) Regulations 2000, the Employment Act 2002, the Fixed-term Employees (Prevention of Less Favourable Treatment) Regulations 2002, the Gangmasters (Licensing) Act 2004, the Pensions Act 2008, the Apprenticeships, Skills, Children and Learning Act 2009, and the Agency Workers Regulations 2010. All those provided the protections that I wanted for rural workers. They exist, and that is why we no longer need the Agricultural Wages Board, because it duplicates that position. I am grateful to the hon. Gentleman for his intervention, and I am glad he asked me that question.
In reality, when we debated these issues, Labour Members in support of the Labour Government resisted me when I spoke about rural poverty and denied that the biggest single removal of money from rural areas was the fuel escalator, which far outweighed anything that could possibly happen through the provision under discussion. They resisted my Fuel Poverty Bill applying to rural areas; they would not even allow for the existence of rural poverty, yet now they have the nerve to lecture the Government about what happens in rural areas.
Let me be clear because misinformation—deliberate I think—is being spread about some areas of this subject. There is a suggestion that people who work in the agriculture industry will no longer have any protection, which is absolute nonsense. The national minimum wage affects 99.5% of all workers in this country but is apparently hopelessly inadequate for the other 0.5%. However, I believe that the national minimum wage—which after the recent settlement is now well ahead of the first grade of pay for agricultural workers—is a valuable protection.
Every single worker who is currently paid under the protection of the Agricultural Wages Board will continue to receive that protection and to enjoy every aspect of their pay and conditions, and we shall ensure that they receive the benefit of legislative protection on that.
Will the Minister give way?
I am afraid I have no time left.
Opposition Members are telling us that the basement protection for the lowest-paid workers is the 2p difference per hour between last year’s AWB rate and the national minimum wage, and that that makes all the difference to rural poverty. I am afraid I do not believe that.
As many Government Members have said, agricultural workers are a precious resource in our rural areas. Do Opposition Members not understand that farmers cannot get a skilled stock man or woman in many areas? They have to pay them to attract them. Do they not understand that farmers do not put someone on the national minimum wage in charge of a £500,000 machine? That is the reality of the modern agriculture industry.
We are therefore left with a statutory body that, uniquely, deals with career progression in one half of one industry—the AWB does not apply to everybody in food and farming. I simply do not believe that a statutory body is necessary to do that—we can do it in better ways. I want to see career progression, flexibility of contracts and modern conditions. Those are the keys to a modern and effective agricultural industry.
claimed to move the closure (Standing Order No. 36).
Question put forthwith, That the Question be now put.
Question agreed to.
Question put accordingly (Standing Order No. 31(2)), That the original words stand part of the Question.
24 April 2013
The House divided:
Question accordingly negatived.View Details