HC Deb 10 January 1995 vol 252 cc9-10
8. Mr. Madden

To ask the Secretary of State for Employment what independent research he has commissioned into the impact within the EC on employment from a statutory minimum wage.

Mr. Oppenheim

There is substantial evidence from the Organisation for Economic Co-operation and Development and other sources that minimum wages have destroyed jobs in Europe.

Mr. Madden

As the Secretary of State likes to pose as a Tory thinker who never misses an opportunity to attack the statutory minimum wage and its impact on employment, is it not extraordinary that lie is so reluctant to commission an independent study so that we can test that argument objectively? Could it be that he is anxious to ensure that facts do not spoil his pseudo-intellectual political rant?

Mr. Oppenheim

I could point the hon. Gentleman to any number of independent studies, ranging from that of the International Monetary Fund to the European Commission's White Paper on competitiveness, which point to the minimum wage as a destroyer of jobs in Europe. However, we do not have to look to independent surveys; we have only to look at the facts. Youth unemployment in France is twice that of the United Kingdom and in Spain youth unemployment is three times our level. Is that what the hon. Gentleman wants for Britain?

Mr. Ottaway

It is not so much the existence of the minimum wage that destroys jobs, but the level at which it is set. Is not the problem with the Opposition's proposals that they always bounce round a figure that is far too high?

Mr. Oppenheim

My hon. Friend is right. I find it absolutely astonishing that the Opposition spokeswoman can come to the House proposing a policy of a minimum wage without telling the House the level at which it would be introduced and what the Opposition would do about differentials. Until she is able to do that, the minimum wage policy will be nothing more than a cynical ploy designed to trick the less well-off into believing that there is some easy, pat way to raise living standards with no cost to the economy. There is not.

Ms Harman

Why has the Secretary of State for Employment ducked out of answering the question asked today by my hon. Friend the Member for Bradford, West (Mr. Madden) about the minimum wage? Is it because he was overruled by the Cabinet when it decided to keep the agricultural wages board? Does not that reluctant decision by the Government vindicate what Labour has said all along about the minimum wage—that it protects good employers from being undercut by the bad, that it ensures fairness at work and that it does not cost jobs?

Mr. Oppenheim

The only person who is ducking questions is the hon. Lady. She had a perfect opportunity just now to tell the House the level at which she would introduce the minimum wage and what she would do about the differentials. The House should not take my word for the problems that the minimum wage would cause. It should take the words of Lord Healey. who said recently: don't kid yourselves. The minimum wage is something on which unions will build differentials … therefore, the minimum wage becomes a floor on which to build a new tower. Lord Healey said that two months ago. He can see sense; why cannot the hon. Lady?

Mr. Peter Bottomley

Will my hon. Friend try some independent research by agreeing with the unions to halve the rate of pay for 16-year-olds in a Government Department—perhaps his own—to see whether, as the pay is halved from £90, the number of 16-year-olds employed doubles, or increases even further?

Mr. Oppenheim

I am not sure that that is necessarily a course that we would like to follow. I say to my hon. Friend and to Opposition Members that, of course, all of us, on both sides of the House, would like people, especially at the low end, to be better paid. The question is how to achieve that. We say that we should invest in education, invest in skills and make people more productive so that we can afford to pay them more in a sustainable way. The Opposition say that we should pay them more regardless of productivity. That would result in low pay being replaced by no pay.