Wages Councils (Hansard, 11 July 1985)

§ Lord Boyd-Carpenter
My Lords, I beg leave to ask the Question standing in my name on the Order Paper.

§ The Minister Without Portfolio (Lord Young of Graffham)
My Lords, the Government have made known their proposal to deratify International Labour Convention 26 on minimum wage-fixing machinery subject to the outcome of consultations in conformity with International Labour Organisation rules. No decision could be taken before completion of these consultation.

§ Lord Boyd-Carpenter
My Lords, I thank my noble friend for that somewhat inconclusive reply. I should like to ask him whether it is not a fact that, if the Government are either to abolish wages councils—as many of us would prefer—or even substantially to moderate them, they are bound under the convention to give the notices referred to in the Question fairly soon.

§ Lord Young of Graffham
My Lords, I thank my noble friend for his question. I believe the position is that there is a window of 12 months from 1st June this year.

§ Lord Jacques
My Lords, will the Minister bear in mind that the Auld Committee strongly recommended that the wages councils should be maintained in retail distribution?

§ Lord Young of Graffham
My Lords, my right honourable friend the Secretary of State for Employment engaged in consultation on the matter. He is considering those consultations. I am sure that he will bear them all in mind, including the deliberations of the Auld Committee.

§ Lord Rochester
My Lords, I think that there is cause for some rejoicing because the noble Lord, Lord Boyd-Carpenter, to judge from the way in which his Question has been framed, appears to have been flirting with the dangerously moderate concept that wages councils may merely be reformed rather than abolished altogether. Should not the Minster take the noble Lord aside and have a little word with him to see whether this is just a temporary aberration or whether 312 the noble Lord, Lord Boyd-Carpenter, is now beginning to see the light?

§ Lord Young of Graffham
My Lords, it is not for me to speculate about the thought processes of my noble friend Lord Boyd-Capenter. However, perhaps I may say that I for one have always found him extremely moderate.

§ Lord Boyd-Carpenter
My Lords, is my noble friend aware that I do not need instruction in aberrations from the noble Lord, Lord Rochester, but that my Question was, I thought, framed with the statesmanlike moderation which I had hoped would appeal to the noble Lord, Lord Rochester, in particular?

§ Lord Bottomley
My Lords, having had battles with the noble Lord, Lord Boyd-Carpenter, in the past, I suggest to the Government that on this occasion, however wise the noble Lord's guidance, it ought to be resisted. I ask the noble Lord whether, if he does persist, he will consider suggesting a minimum national wage.

§ Lord Young of Graffham
My Lords, I am sure that my right honourable friend the Secretary of State for Employment, when he announces the result of his deliberations, will be shown to have acted not only with moderation but also with wisdom.

§ The Earl of Lauderdale
My Lords, does not my noble friend agree that, since it is always right to be moderate, moderation is of course the normal hallmark of the right?

§ Lord Young of Graffham
My Lords, yes.

§ Lord Sainsbury
My Lords, many years ago I was chairman of the employers' side of a wages council. I should like to ask the Minister whether he will confirm that the Low Pay Unit, the TUC, the CBI, the Institute of Personnel Management, the Co-op and the Retail Consortium, which represent 90 per cent. of the retail trade in this country, are all against the abolition of the wages councils.

§ Lord Young of Graffham
My Lords, the results of the representations which were received by my right honourable friend showed that many were in favour and that many were against, but the quality and the quantity of those for and against have yet to be assessed. I am quite sure that when the results of those deliberations have been received all will be satisfied with them.

§ Lord Dean of Beswick
My Lords, does not the noble Lord agree that the formidable list which has just been given by the noble Lord, Lord Sainsbury, of people who have a vested interest in this particular problem and who are against abolition, indicates that the situation would be well left alone and that the usual procedures for dealing with salaries should continue? It is a fact of life that the particular sections of the community covered by those particular agreements have been some of the most industrially peaceful communities in our society, and as such they ought to be left alone.

§ Lord Young of Graffham
My Lords, I am sure that all your Lordships would agree that the most preeminent matter before us today is employment. Anything which can help to increase employment should be looked at and studied. I am sure that that is the guiding principle underlining the deliberations of my right honourable friend and I am also sure that all will be satisfied with what he will have to say.

§ Lord Graham of Edmonton
My Lords, is the Minister aware of the contrast which is posed in the Question? It is proposed radically to alter, if not to abolish, the minimum wage of shop workers, which stands at £71 a week; whereas for four attendances in your Lordships' House a Member of this House can claim £72 a week. Is that not nauseating hypocrisy and humbug?

§ Lord Young of Graffham
My Lords, that is for the noble Lord himself to judge.

§ Lord Glenamara
My Lords, has it not been proved over and over again and beyond doubt in our industrial history that it is fallacious nonsense to assume that employment can be increased by lowering wages?

§ Lord Young of Graffham
My Lords, no. If one thing has been shown and demonstrated it is simply that, for example, in the field of youth employment, the lower the starting wage of young people, the more young people price themselves into employment. It is the very process of negotiating upwards the entry level of wages into our system which has been one of the preeminent causes of unemployment in the last decade.

§ Lord Underhill
My Lords, does not the Minster accept that it is a rather pitiful political policy that the only practical suggestion—if you can call it practical—for dealing with unemployment is that of cutting workers' pay? Is not that a rather pitiful political policy?

§ Lord Young of Graffham
My Lords, I find it rather curious to regard as pitiful anything which succeeds in increasing employment. Employment is the cause before us. If there are statutory arrangements in being which inhibit employment, then it is the duty of this Government—the duty of any Government—to ensure that they are removed. If there are no statutory inhibitions, then of course the arrangements should remain.

§ The Earl of Onslow
My Lords, is my noble friend aware that the German apprentice wage is much lower, as a percentage of the skilled man's wage, than is the case in the United Kingdom and that consequently the Germans have a higher percentage of entry to apprenticeships than we do? Does he not agree that that therefore shows why the German economy is better than ours?

§ Lord Young of Graffham
My Lords, this afternoon we are discussing wages councils. They do not of course cover apprenticeships, although I am well aware of the point which my noble friend is making, Nor, indeed, do they cover all young people. They 314 concern one sector of our society. The matter is being examined and I hope that it will soon be decided and that the consultations will reveal that we are taking the right decision.

§ Lord Brockway
My Lords, is the Minister aware that wages councils have saved thousands of people from being driven down to a wage below a living standard? I speak on this matter because I participated in their formation. Can the noble Lord possibly justify the destruction of this means of preventing wages dropping below a living standard, when at the same time the salaries of managers of industries are rising by hundreds of thousands of pounds?

§ Lord Young of Graffham
My Lords, I regard it as unfortunate that we should compare wage levels at both ends of industry, and I say that for the following reasons. First—and this deals with the first part of the noble Lord's question—wages councils, whether they exist or do not exist, are not there to stop people being driven to accept wages at below subsistence levels. That is the purpose of social security. It is a system which we have looked at and which we guard and cherish. Those in our society who engender greatness in our companies and drive the economy forward must be given a proper reward. We must try to give employment to all. Let us never forget that.