To ask Her Majesty’s Government what assessment they have made of the impact on (1) the economy, and (2) society, of increasing numbers of people working from home.
The pandemic resulted in an unprecedented increase in the proportion of people working from home—from 19% pre-pandemic to a peak of roughly 50% in June 2020. It has since fallen back to 38%. It remains unclear whether this will persist, and the long-term impact of greater remote working is highly uncertain. The Government are monitoring this closely.
As someone whom your Lordships have kindly permitted to work from home—I wish it was not necessary in my case—I ask the Minister whether the Government accept that the advantages of hybrid working include improved work/life balance, well-being and the ability to care for family and home; enhanced productivity; the retention of more people in the labour market; opportunities for high-quality employment across the regions; a better balanced housing market; revived high streets and stronger communities; and reduced emissions from commuting. Will the Government therefore embrace home and remote working in the Civil Service and the public sector, in the tax and social security systems, and in their levelling-up, digital and net-zero strategies?
My Lords, the Government will accept some of those benefits set out by the noble Lord. However, we also need to think about some of the other effects—for example, evidence also indicates lowered innovation and knowledge-sharing in the workplace due to remote working. So the Government support the ability to work flexibly and support businesses in finding the right approach for them. I think there are many benefits to home or remote working, but those need to be balanced against some of the negatives we can also see.
Will my noble friend the Minister think for a moment about those people who do not work from home but who use their own cars for work purposes? Given that petrol has now reached £10 per gallon, should the Treasury not think about changing the 45p allowance, which barely covers the cost of petrol, let alone other costs? At that level, people have to pay tax and national insurance on any remuneration they receive back from their employer for using their own vehicles.
My noble friend is absolutely right that, even at its peak, only 50% of people reported working remotely, so we must remember the other half of people who were not doing any remote working at all during the pandemic—and even less so now. I understand his concern about fuel costs; this is why my right honourable friend the Chancellor gave the biggest cut to fuel duty that we have seen in a number of decades in the recent Spring Statement.
My Lords, I wonder if the Minister, following her very helpful replies to my noble friend, will ensure that the message she is giving to this House is also given to Members of the Cabinet. When Jacob Rees-Mogg made his remarks, there was a marked decline in the number of applications to public sector jobs, because it is absolutely clear that young people want a different pattern of employment to that which was normal for people like me. They want more hybridity and flexibility—maybe the Cabinet need to understand that too.
I understand the point the noble Baroness makes. We do need to move with the times on hybrid working; however, from the perspective of young people—I am not sure that I am one, but I may be slightly younger—there are some downsides to remote working regarding opportunities to mentor and learn in the job, or for people whose housing situations do not allow them space to work properly. It is all a question of balance. It is also right, after the peaks of what we saw during the pandemic, that people move more towards spending some time in the office and interacting with colleagues.
My Lords, increased home working has led to a dramatic drop in sales of rail season tickets, down to 30% of pre-pandemic levels. Traditionally, rail companies relied heavily on this reliable source of funding. We have been promised for years the modernisation of ticketing on the railways, making tickets simpler to purchase, with cheaper and fairer fares. Can the Minister tell us when we are going to get this long-promised revolution?
My Lords, I believe that quite a bit of it is under way, but I am not as familiar with progress as my colleagues in the Department for Transport will be. What I can say is that an assessment by the National Infrastructure Commission found—the noble Baroness is right—that pandemic restrictions and associated increases in remote working did affect infrastructure use. However, it is too early to assume that long-term behaviour change such as increased remote working would lead to a wholly different pattern of infrastructure. In terms of our approach to transport infrastructure, there is an element of “wait and see” on the effects of the pandemic.
Does my noble friend accept that most sensible employers—I count myself as one—have a balance in this? They bring people in, say, two days a week when everybody works together and gets the advantages of which she speaks. The point of this Question really is that the Government ought not to give the appearance that the way we are dealing with this in the public sector is somehow different from the private sector, which has reached out to this new way of working. In terms of family friendliness it is enormously better, and in my business I certainly find better productivity as a result, because people feel happier about the work/life balance.
I would absolutely echo my noble friend’s language around balance, and he has mentioned some of the other benefits of hybrid working that we have discussed. Each government department sets its own hybrid working policy. The Treasury, for example, expects staff to work 50% of the time in the office and the remaining time at home over a two-week period. I think that strikes a balance.
My Lords, flexible working is one of the many issues that could and should be included in an employment Bill. That legislation has been promised for years, but still we wait for the Government to bring forward proposals. With these questions becoming more urgent, why did the Government opt against including that Bill in the recent Queen’s Speech?
My Lords, I am afraid that I am not sure I can add to any previous answers on the employment Bill, except to say that we are still committed to bringing one forward when parliamentary time allows. However, progress on our Good Work agenda does not need to wait for the Bill: we have made progress on a number of initiatives, either through secondary legislation or policy changes, and we will continue to look for those opportunities to make progress on that agenda.
My Lords, I have to confess that I thoroughly enjoyed the opportunity to work from home: it was the very first time in 35 or 40 years that I had been able to spend that much time with my family. What assessment have the Government made of the impact of domestic violence on women who have continued to work from home and have additional responsibilities as carers?
There are couple of points in the noble Baroness’s question. We have seen a positive impact overall on those with caring responsibilities, with the increase in hybrid working and more opportunities for them to stay connected to the workplace. But she also mentioned domestic violence, which was another issue during the pandemic. We saw that it was important for people to have the option to come into the office as a safe space for them to work, because home is not always a safe space for everyone, sadly.
My Lords, will the Government bear in mind the many people who do not have the opportunity to work from home? Those who work in the National Health Service and on the front line in the police service, along with many other public sector workers, do not have the opportunity to work from home. There must not be a division between those who have to attend work and those who do not.
My noble friend makes a very important point. It is incumbent on all of us to see life through not just our own experience but that of others. As I said, at the moment the majority of people do not work from home at all, and we need to understand that too.
My Lords, further to the question of the noble Lord, Lord McLoughlin, is it not true in so many respects that the people who cannot work from home are the people on whom society depends most? You cannot be a nurse, a bus driver or a plumber and work from home. There is a whole range of people who cannot do so, and if there are tremendous benefits from flexible working, maybe we ought to be looking at ways of reducing the length of their working week as compensation for the fact that they simply cannot ever work from home.
Where I do agree with the noble Lord is that flexible working encompasses a whole range of different working practices, not just working from home or hybrid working; it might also include part-time working or job shares. There are huge opportunities in this space, including for people for whom working from home is not an option at all. The Government will continue to take forward work in that area.