Business Impact Target

Andrew Griffiths Excerpts

Wednesday 20th June 2018 Written Statements

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Andrew Griffiths)]

This statement sets the Government’s business impact target in respect of the economic impact on business of regulation which comes into or ceases to be in force for this Parliament, along with related matters as required under section 21 of the Small Business, Enterprise and Employment Act 2015 (“the Act”).

It is important to recognise that the Government are setting an ambitious target. The Government are committed to providing legal certainty and a stable environment for business by incorporating all EU law into UK law, as well as taking necessary action in areas such as product safety, plastics and corporate governance. Consequently, the Government will continue to monitor regulatory impacts rigorously, while placing the importance of regulating to tackle these nationally important issues above a strict adherence to the target.

Business impact target¹

The Government’s target is for a saving of £9 billion to business and voluntary or community bodies from qualifying measures that come into force or cease to be in force during this Parliament.

Interim target²

The interim target covers the savings to be achieved from qualifying measures that come into force or cease to be in force in the first three years of this Parliament. The Government’s interim target is a saving of £4.5 billion.

Measurement of the business impact target³

The impact of each qualifying measure will be assessed on the basis of its equivalent annual net direct cost to business (EANDCB) measured in 2016 prices and with a 2017 present value base year. As in the previous Parliament, the contribution to the business impact target will be the sum of the EANDCB over the first five years for which the measure will be in force, or the sum of the EANDCB over the full lifetime of the measure for measures that are, or will be, in force for less than five years.

Qualifying regulatory provisions⁴

Under the Act, the measures that are in scope for the business impact target are described as “regulatory provisions”. That includes both legislation and the activities of Ministers and listed regulators. The Government must designate the categories of regulatory provisions that are to be scored against the target (“qualifying regulatory provisions”). Qualifying regulatory provisions are regulatory provisions that do not fall within any of the exclusions set out below:

a) Regulatory provisions that have been certified by Departments or regulators as falling under the de minimis rule, namely those that have an EANDCB of less than ± £5 million;

b) Regulatory provisions that implement new or changed obligations from European Union regulations, decisions and directives, and other international commitments and obligations, except in cases of gold-plating. This includes measures incorporating EU law into domestic law under the EU Withdrawal Bill and legislation made for the purpose of implementing the EU withdrawal agreement, including implementation of new EU law during the implementation period.

c) Regulatory provisions that have been certified by Departments or regulators as dealing with deficiencies in retained EU law (under the EU Withdrawal Bill and other legislation);

d) Regulatory provisions that are intended to deliver—or to replicate—better competition-based outcomes in markets characterised by market power;

e) Regulatory provisions relating to systemic financial risk;

f) Regulatory provisions relating to civil emergencies;

g) Regulatory provisions concerning fines and penalties, and redress and restitution;

h) Regulatory provisions that implement changes to the classification and scheduling of drugs under the Misuse of Drugs Act 1971 where these follow the recommendations of the relevant independent advisory body;

i) Regulatory provisions that have been certified by Departments or regulators as relating to the safety of tenants, residents and occupants in buildings that stem from, or relate to, Government’s response to the Grenfell tragedy, reviews, inquiries or working groups;

j) Regulator casework including specific investigation and enforcement activity, individual licence decisions, and individual advice;

k) Education, communications activities, and promotional campaigns by regulators, including media campaigns, posters, factsheets, bulletins, letters, websites, and information/advice helplines;

I) Policy development by regulators, including formal and informal consultations, policy reviews, and ad hoc information requests;

m) Changes to the organisation and management of regulators, except for those resulting from legislative changes or another policy change that is a qualifying regulatory provision;

¹ As required under section 21(1)(a) of the Act.

² As required under section 21 (2) of the Act.

³ As required under section 21 (3)(b) of the Act.

⁴ As required under section 21 (3)(a) of the Act.

[HCWS776]

Insecure Work and the Gig Economy

Andrew Griffiths Excerpts

Wednesday 20th June 2018 Westminster Hall

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Andrew Griffiths)]

As always, it is a great honour and pleasure to serve under your chairmanship, Mr McCabe.

It is also a great honour and pleasure to take part in what I think we all agree has been a very important, well-attended and very positive debate about the desire of Members from all parties in this House to protect the most vulnerable workers in our society. I congratulate the hon. Member for Barnsley East (Stephanie Peacock) on securing it and on the magnificent way in which she spoke up for workers in her constituency and across the country.

Employment rights and protections are important for this Government. In fact, the Government have made a commitment to seek to enhance rights and protections in the modern workplace. The gig economy and agency working offer great opportunities and new ways in which to participate in the labour market. For many people, they have transformed their opportunities to work when and how they want, and produced a flexible and dynamic way to work.

[Justin Madders]

Will the Minister give way?

[Andrew Griffiths]

I will give way just once; Members will understand that I am short on time.

[Justin Madders]

It is very generous of the Minister to give way. Obviously, we have heard a lot about flexibility, but if someone is reliant on these employers to give them work, does he think that the landlord will be flexible in getting the rent for that month?

--- Later in debate ---

[Andrew Griffiths]

I completely understand the hon. Gentleman’s point. That is why we have recognised that those opportunities come with risks, and that some in the workforce need greater protections.

The UK’s flexible, dynamic labour market has allowed the economy to bounce back from Labour’s recession and has delivered record employment; unemployment is at the lowest rates for 40 years. However, we recognise that it has not worked for all. It was for that reason that Matthew Taylor was asked by this Government to examine the current labour market and employment law framework, to help us to understand the opportunities of future working practices as well as to identify areas where the labour market was not working for everyone.

That is why in February the Secretary of State for Business, Energy and Industrial Strategy made a commitment in the industrial strategy to take responsibility for the quality of work, which was the first time ever that a Government focused on quality as well as quantity of work. Our aim is to drive forward the change required to ensure that creating quality of work is given equal priority to the quantity of work that is created.

Our detailed response to the Taylor review was published on 7 February. In that response, we committed to take forward 52 of the 53 recommendations. Our response clearly demonstrates that we are progressing with our commitment to take firm action to protect the most vulnerable, the lowest paid and those who work in a non-traditional way.

For example, we have consulted on state enforcement to ensure that vulnerable workers get their holiday and sick pay; we have asked the Low Pay Commission to consider higher minimum wage rates for workers on zero-hours contracts; we are providing all 1.2 million agency workers with a clear breakdown of who pays them, and of any costs or charges that are deducted from their wages; we are ensuring that all workers get an up-front statement of terms and conditions from day one; we are making it easier for flexible workers to accrue employment rights, by extending the permissible breaks in continuous service; and we are creating a right to request a stable contract for all workers. To progress that work, we have very recently completed four consultations on employment status, agency workers, transparency and enforcement, which are necessary to deliver the change that this Government wish to see.

The hon. Member for Barnsley East asked whether we would give workers the same equal pay rights as other employees. The Government do not support or condone the use of Swedish derogation contracts to circumvent equal pay entitlements. Let me be absolutely clear on that. That is why we have consulted to gather views and evidence on our response. Options include repeal or regulation in relation to the use of the Swedish derogation. Before taking a final decision, it is right that we consider the views coming forward properly in that consultation.

The hon. Member for North West Durham (Laura Pidcock) accused the Government of ruthless whipping. As a former Whip, I take great exception to that. She raised the issue of zero-hours contracts, but the number of people reporting that they are employed on a zero-hours contract is down from 905,000 last year to 901,000. Some 6% of businesses use some form of a zero-hours contract. There are 1.7 million temporary workers in the UK, but 28.4% of them said that they did not want a permanent job.

My hon. Friend the Member for Chichester (Gillian Keegan) made a magnificent speech, and pointed out the challenges and the opportunities of the gig economy. She rightly said that 90% of gig economy workers are satisfied with the jobs they are doing.

The hon. Member for Glasgow South West (Chris Stephens), in his usual determined manner, said that there should be more people enforcing the minimum wage. I am delighted to tell him that the Government have continued to invest heavily in minimum wage enforcement. We have doubled the budget to £26.3 million, up from £13 million last year. As a result, we secured £15.6 million in arrears last year, covering 200,000 workers in this country who had redress thanks to the Government’s support.

[Chris Stephens]

Will the Minister confirm that 25% of the posts at the national minimum wage compliance unit are still lying vacant?

[Andrew Griffiths]

I do not think that is right. I will write to the hon. Gentleman, but I assure him that those figures are wrong.

The hon. Member for Batley and Spen (Tracy Brabin) asked what the Government have done about pregnancy and maternity discrimination—a subject that is dear to my heart and that of the hon. Member for North West Durham. In response to Taylor, we are working to improve the guidance and advice on pregnancy and maternity rights and employers’ obligations. We also committed to review redundancy protection within the next 12 months. The hon. Member for Batley and Spen asked about shared parental leave for self-employed people. As she recognises, it is under review. I cannot commit to that today, but once again she makes that point loud and clear.

The Taylor review considered not only the plight of agency workers, which many hon. Members raised. In his 2018-19 strategy, the director of labour market enforcement published recommendations to support those workers. In response to Matthew Taylor’s recommendations on agency workers, the Government have already committed to take action and improve transparency on pay and on the rate workers will receive on taking up assignments. Quite simply, it is not right that individuals do not receive the advertised rate of pay.

I have mentioned the issue of the Swedish derogation. We are also considering extending the Employment Agency Standards inspectorate’s remit better to protect agency workers from emerging challenges in the labour market. We are looking at whether it should include umbrella companies, about which we all have concerns. I am sure the hon. Member for Barnsley East understands that I cannot pre-empt the results of the Taylor consultation. It is clear that Members on both sides of the House agree that agency workers’ employment rights need special consideration and protection.

The Government are committed to ensuring that the UK is a great place not just to grow a business, but to work. We understand that being employed is not enough if the employee is at risk of being exploited or mistreated by their employer. We have consulted on options for what would be the most radical shake-up of our employment law in decades and we will take the necessary action to protect workers across the United Kingdom.

Oral Answers to Questions

Andrew Griffiths Excerpts

Tuesday 12th June 2018 Commons Chamber

[Maria Caulfield (Lewes) (Con)]

9. What steps he is taking to support high street businesses.

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Andrew Griffiths)]

The retail sector is an important part of our economy and our industrial strategy, as are the 3 million jobs employed in it. In March, I established the Retail Sector Council so that retailers can work together with the Government to develop policies to support the sector. Last week, the Secretary of State and I held a roundtable in Downing Street with retailers to establish how to tackle the challenges facing the sector.

[Maria Caulfield]

As more retailers struggle to survive on our high streets, what discussions has the Minister had with Treasury colleagues to move business rates away from a property-type tax so that high-street retailers can compete on a level playing field with online businesses?

[Andrew Griffiths]

As my hon. Friend will know, in April 2017, retailers saw a 6% reduction before inflation in their business rates, with £3.6 billion of transitional relief. We are doing what we can to support businesses. The Retail Sector Council will be looking at a range of issues, including business rates. The Government are determined to ensure that the taxation system is up to date and fit for purpose.

[Toby Perkins (Chesterfield) (Lab)]

One of the areas on the high street that is particularly struggling is that of our important pubs. I would be interested to hear the Minister’s view on the extent to which pub-owning businesses and tenants enjoy confidence in the Pubs Code Adjudicator—and if they do not, what steps the Government are taking to put that right.

[Andrew Griffiths]

As the hon. Gentleman will know, I take a particular interest in the health of public houses up and down the country. He will know that this Government set up the Pubs Code Adjudicator to ensure that landlords and tenants across the country got a fair deal. It is still early days, but the adjudicator is getting on and making decisions. I know that the Under-Secretary of State for Business, Energy and Industrial Strategy, my hon. Friend the Member for Watford (Richard Harrington), is in close discussions with the adjudicator to ensure that he is getting the job done.

[Sir Patrick McLoughlin (Derbyshire Dales) (Con)]

Do the Government feel that there is a level playing field between internet providers and businesses on the high street?

[Andrew Griffiths]

I congratulate my right hon. Friend on his election to the Select Committee; I am sure he will do a great job in standing up for British business. He highlights a key issue, which is the transition from traditional bricks and mortar to online. Last year alone, we saw a 9% increase in online retail. Clearly, that is a challenge for Government and business. That is why we are looking at the business rates structure and also at what we can do to help business to transition during this difficult period.

[Laura Smith (Crewe and Nantwich) (Lab)]

The British Retail Consortium has estimated that up to one third of retail jobs could disappear by 2025 as a fundamental transformation of the market occurs. Does the Minister agree that providing retail workers with the opportunity to upskill and reskill is critical to avoiding mass job losses over the next decade?

[Andrew Griffiths]

I absolutely agree that it is important to ensure that our workforce are properly skilled, which is why that is an important part of our modern industrial strategy, but I am less pessimistic than she is. Retail employment has been stable at about 3 million. Yes, those jobs are changing, but retail sales totalled some £362 billion last year, and jobs are being created in the retail sector.

[Bill Esterson (Sefton Central) (Lab)]

Last week, House of Fraser announced that 6,000 jobs were at risk. Yesterday, another 5,000 jobs went at Poundworld. Since the start of the year, tens of thousands of retail workers have lost their jobs. Some 3.9 million people work in our retail sector. They, their employers and anyone who cares about our high streets want a retail sector deal, so when are the Government going to publish the strategy? More to the point, will it have any meaningful action?

[Andrew Griffiths]

I thank the hon. Gentleman for his question. Yesterday, I spoke to the chief executives of both House of Fraser and Poundworld to properly understand the challenges that those businesses face and what Government can do to support them. The hon. Gentleman talks about a sector deal. I politely point out that it was this Government who had to take action to bring together the Retail Sector Council, a forum in which to develop policies. While the Labour party sits by and watches, this Government are getting on and working with the retail sector to protect those jobs.

[Mr Robert Goodwill (Scarborough and Whitby) (Con)]

10. If he will make an assessment of the potential contribution of the Sirius Minerals polyhalite project to the industrial strategy.

--- Later in debate ---

[Huw Merriman (Bexhill and Battle) (Con)]

High street businesses lose out when banks close, pensioners lose banking services, and post offices are also facing challenging times. What can be done to make sure that the main high street banks provide their services at least in a host post office that acts as a hub?

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Andrew Griffiths)]

My hon. Friend, who makes some important points, will know that the Government have invested £2 billion in the post office network to ensure that across the country, in communities where retail banks are closing, the Post Office can step up and allow his constituents and businesses, among others, to access both personal and business banking in their local post office. That is good for the post offices and for our communities.

[Paula Sherriff (Dewsbury) (Lab)]

T10. Dewsbury town centre is a shadow of its former self and has the second highest rate of vacant units in the country. Will the Minister tell me exactly what the Government are doing to deal with the decline of high streets in northern towns such as mine?

[Andrew Griffiths]

The hon. Lady will know that the retail sector is particularly impacted on by changes in consumer behaviour. More people are shopping online, and that is a challenge for the sector. There is no silver bullet, but through the retail sector we are sitting alongside industry and trying to understand the challenges it faces, such as on business rates and how we adapt to ensure that we not only help the sector to make that transition, but protect the jobs of the 3 million people employed in the sector.

[Stephen Kerr (Stirling) (Con)]

When will the Government respond to the joint report on Carillion by the Business, Energy and Industrial Strategy Committee and the Work and Pensions Committee?

[Andrew Griffiths]

I thank my hon. Friend for his question and thank the Select Committees for their work on Carillion. They did a truly remarkable job in holding the directors of Carillion to account and uncovering exactly what went on with the Carillion collapse. I think the report was issued on 16 May, and the Government have 60 days in which to respond, but I can assure him that we are doing all we can to meet the challenge.

[Several hon. Members rose—]

--- Later in debate ---

[James Cartlidge (South Suffolk) (Con)]

Given the success of auto-enrolment, will the Minister outline what steps the Department is taking to ensure that as the country saves more, we invest more in British industry?

[Andrew Griffiths]

The hon. Gentleman will know that through the industrial strategy we are doing all we can to support British business and make sure it gets the investment it needs, particularly through the British Business Bank, which is looking to release £20 billion of patient capital to give our businesses the rocket fuel they need to grow.

[Mr Adrian Bailey (West Bromwich West) (Lab/Co-op)]

The decision by JLR to invest in electric vehicles is very welcome, but equally the decision to produce the Discovery model in Slovakia is profoundly worrying. Does the Secretary of State agree that it underlines the need for tariff-free access for both cars and components in the EU?

--- Later in debate ---

[Rachael Maskell (York Central) (Lab/Co-op)]

There is clearly a crisis on our high street, so will the Minister ensure that business rates are fully addressed in this year’s Budget?

[Andrew Griffiths]

I can assure the hon. Lady that, together with the retail industry, we are looking at business rates, their impact on businesses and our ability to ensure we have a fair taxation system.

[Kirsty Blackman (Aberdeen North) (SNP)]

The industrial strategy challenge fund round closed in April, but the Government are not expected to make a decision until the tail end of this year. Can they speed up the process please?

[Fiona Onasanya (Peterborough) (Lab)]

Employees in my constituency have time limits imposed on their toilet breaks, which are insufficient. What assessment has the Department made of businesses adopting such practices?

[Andrew Griffiths]

The Department keeps a close eye on developments of this kind, and I assure the hon. Lady that the matter is firmly on our agenda. We want to ensure, through the Matthew Taylor review and the work we are doing ourselves, that workers are treated fairly, receive the support that they need in business, and are fairly paid.

[Alison Thewliss (Glasgow Central) (SNP)]

One of the biggest missing links in the tackling of money laundering is the Government’s own agency, Companies House. When will the Minister ensure that it is funded adequately and has enough staff to carry out proper checks on businesses?

[Andrew Griffiths]

I assure the hon. Lady that we are seeking to ensure that Companies House is fit for purpose. As she will know, in 2016-17 it brought some 3,182 prosecutions. Companies House is very attuned to the challenges that it faces, particularly in relation to money laundering. That is why we are introducing, for instance, measures relating to Scottish limited partnerships, which I am sure the hon. Lady will welcome.

[Mr Barry Sheerman (Huddersfield) (Lab/Co-op)]

I know that the Secretary of State is an honourable man. He is the Business Secretary. If we have a hard Brexit, British business will be devastated. Will he join us today in voting to keep us in the single market?

--- Later in debate ---

[Stewart Malcolm McDonald (Glasgow South) (SNP)]

What support can my constituents, who are among the 5,000 set to lose their jobs at Poundworld, expect from the Government?

[Andrew Griffiths]

As the hon. Gentleman will know, I spoke to the chief executive of Poundworld yesterday to try to understand the challenges that it faces. Through the official receiver, the special manager is seeking to do everything possible to rescue the business, and they are hopeful that there are buyers out there for at least part of it. We in the Government have pledged to do all that we can to ensure that the business is rescued.

Retail Sector

Andrew Griffiths Excerpts

Wednesday 6th June 2018 Commons Chamber

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Andrew Griffiths)]

It is a delight to get to the Dispatch Box at last, Madam Deputy Speaker, and I hope that you will indulge me and allow me to answer some of the important points that have been made in this excellent debate. I thank the Opposition for bringing it forward. It is clear that there is strong agreement across the House that the retail sector is vital to our economy, our local communities and the many thousands of constituents who rightly rely on the sector for their livelihoods.

I will quickly address some of the points raised by right hon. and hon. Members in this debate. The hon. Member for Inverness, Nairn, Badenoch and Strathspey (Drew Hendry), in an interesting speech that particularly focused on Brexit for a change, raised the issue of austerity but forgot to remind the House that, as a result of changes to lift the lowest paid in society out of paying tax and as a result of the biggest increase in the national minimum wage and the national living wage for 10 years, those on the lowest pay are now £3,800 a year better off—that is thanks to the policies of this Government.

The hon. Gentleman understandably raised an important point about the pay of the youngest in society. I share his desire to ensure that young people are fairly paid, but he forgot to mention that unemployment among 16 to 24-year-olds is persistently higher than among those aged 25 and over—12.1% compared with 3.1% across the country. The unemployment rate for 16 to 17-year-olds is 26.9%. Increasing pay would make it more difficult for young workers, whose priority is to get their first years on the job ladder, to secure work.

[Drew Hendry]

Will the Minister give way?

[Andrew Griffiths]

I know the points the hon. Gentleman will make, so I hope he will forgive me if I do not allow him to intervene. Time is pressing.

The hon. Member for Ellesmere Port and Neston (Justin Madders) made an interesting speech in which he talked particularly about the loss of banks. Although I share his concern, he will know the Government have invested some £370 million in the post office network, which now provides both business and retail banking. I am sure he values the contribution that that is making to the important post office network across our communities.

The hon. Member for Bishop Auckland (Helen Goodman) had a shopping list of questions, which is apt in a debate on retail, but, as with all shopping lists from the Labour party, it had a huge price tag attached. She asked for Boxing day to be a bank holiday for retail workers, but she forgot to mention that that would cost employers an extra £1.2 billion.

The hon. Lady raised the issue of competition policy and the banks being able to share premises. As I understand it, there is no competition policy issue that would prevent banks from sharing premises—they would obviously have to be careful about sharing data and personal information. If she has other concerns, I will be delighted to talk to her. Perhaps she could drop me a little note on her concerns.

My hon. Friend the Member for Torbay (Kevin Foster) made an interesting speech, particularly on “Love Your High Street,” which he is championing. I hope he will be getting free beer at the Peaky Blinders bar after he mentioned it. He made a particular point on the need to revitalise our high streets and change the way they are purposed, and I absolutely agree.

My hon. Friend the Member for Stirling (Stephen Kerr) raised the sad loss of The Boozy Cow and The Fat Cyclist Café, which are a great loss to us all. He also raised the important issue of the need for innovation in our town and city centres.

The hon. Member for Great Grimsby (Melanie Onn) again raised the Grimsby town deal, about which she cares passionately. She also raised the issue of coffee shops and said that surely we cannot eat any more cake—there are hon. Members present who might disagree. My hon. Friend the Member for North East Derbyshire (Lee Rowley) made some particularly important points, for which I am grateful.

Let us reflect on the recent structural changes in the sector and on the announcements we have had of late. There has been a shift in consumer behaviour, and we need to be aware of that shift. The move towards new technology is a great innovator and it provides great opportunities, but it also provides great challenges. I commend my hon. Friend the Member for Mansfield (Ben Bradley) for his campaign for free parking, which is an excellent proposal. He is standing up for his local residents.

My hon. Friend the Member for Redditch (Rachel Maclean) mentioned Labour’s yellow brick road, and on the folly of the Labour party, I point to the problems of Cannock Chase District Council, which is now trying to charge hard-working independent retailers £85 just for having an A-board to advertise their shops. That is the Labour party getting in the way of private business, as usual.

Many Members mentioned the key issue of business rates. The Government are aware of the wider business rates concerns and are looking to address them. We undertook the last fundamental review of business rates in 2016, announcing reforms worth £9 billion. A further £4.3 billion package was announced at the spring Budget in 2017, including £110 million to support 16,000 small businesses. I hope that Members from across this House will join me in celebrating Small Business Saturday later this year to try to support small high street retailers.

The Secretary of State mentioned the Retail Sector Council, which I am chairing, and the hon. Member for Sefton Central (Bill Esterson) asked whether we were working with USDAW. I should point out to him that USDAW sits on the RSC and is making a great contribution, and we are grateful for its support. The RSC will look at the issue of business rates, as per our manifesto commitment.

We all recognise the importance of retail and the contribution it makes, not just to the UK economy, but to our communities up and down the country, and the people it employs. I reassure the House that we will continue to work with the unions, the retail sector, local government and everyone else concerned to make sure that the retail industry across the UK has a bright future.

Question put and agreed to.

Resolved,

That this House notes that 21,000 jobs were lost in the retail sector in the first three months of 2018 due to store closures and company administrations, with more announced since; further notes that the retail sector is one of the largest employers in the UK and contributed £94.6 billion to the UK economy in 2016; regrets that the Government’s industrial strategy contains only three references to the retail sector; further regrets that the Government has presided over the biggest squeeze in wage growth in a generation, is failing to provide certainty around future trading arrangements after Brexit and has failed to ensure a fair business rates system; and calls on the Government to urgently publish a strategy for the retail sector.

Consumer Policy

Andrew Griffiths Excerpts

Tuesday 15th May 2018 Written Statements

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Andrew Griffiths)]

I am today publishing the Department’s investigation into the safety of the Hotpoint fridge freezer model FF175B which police identified as being involved in the tragic fire at Grenfell Tower on 14 June last year.

The safety of consumers is a key priority for this Government, which is why the Secretary of State for Business, Energy and Industrial Strategy (BEIS), my right hon. Friend the right hon. Member for Tunbridge Wells (Greg Clark) ordered an immediate examination of the appliance by independent technical experts. Within days the Department had undertaken a preliminary assessment and issued advice following a meeting convened by the Government’s chief scientific adviser including public health advisers. The advice to owners of the model concerned—Hotpoint FF175B—was that they could continue to use their fridge freezer as the public health risk of advising not to use the appliance was judged to be of greater risk. Owners were advised to contact the manufacturer to register their appliance so they could be contacted directly should any further action be necessary.

At the same time the Department began a thorough and comprehensive product safety investigation into the model to identify whether there was any wider safety risk to the public. BEIS experts conducted a product safety investigation, examining the Grenfell Tower appliance, commissioning independent examination and testing of example FF175B appliances, undertaking analysis of data and documents and risk assessment. Whirlpool has co-operated with the investigation and has undertaken its own investigation in line with its legal obligations as the manufacturer of the product.

The full investigation has now concluded. It confirmed the advice that was given to consumers in June, that there is no need for a product recall or for any other corrective action for this model, and that consumers can continue using the product as normal. The investigation concluded that the product met legal safety requirements and that the risk associated with the model is assessed as low. The findings have been confirmed by separate and independent tests, under the supervision of the BEIS chief scientific advisor, carried out by scientific and technical experts including the Health and Safety Executive and Intertek.

We have shared the results of our investigation with the Metropolitan police, the Grenfell inquiry, and, of course, with the Grenfell residents through appropriate channels.

The Government continue to place huge importance on consumer safety. This is why, on January 21, 2018, we accepted all the recommendations made by the Working Group on Product Recall and Safety to upgrade the UK system of product safety, and we established the Office for Product Safety and Standards.

A copy of the risk statement and technical reports relating to the investigation have been published and copies of the documents have been placed in the Libraries of both Houses.

[HCWS684]

Business, Energy and Industrial Strategy

Andrew Griffiths Excerpts

Tuesday 15th May 2018 Ministerial Corrections

[Andrew Griffiths]

I confirm that there is an obligation in place for manufacturers to notify the Office for Product Safety and Standards. I will come on to how the database will work further on in my speech.

[Official Report, 9 May 2018, Vol. 640, c. 314WH.]

Letter of correction from Andrew Griffiths.

An error has been identified in the response I gave to the hon. Member for Hammersmith (Andy Slaughter).

The correct response should have been:

[Andrew Griffiths]

I confirm that there is an obligation in place for manufacturers to notify the relevant market surveillance authority. I will come on to how the database will work further on in my speech.

Draft Package Travel and linked travel arrangements regulations 2018

Andrew Griffiths Excerpts

Monday 14th May 2018 General Committees

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Andrew Griffiths)]

I beg to move,

That the Committee has considered the draft Package Travel and Linked Travel Arrangements Regulations 2018.

It is a pleasure to serve for the first time under your chairmanship, Mr Hosie. The regulations will update and replace existing legislation by implementing the requirements set out in the 2015 European package travel directive.

Package travel regulations have provided protection to travellers for many years, but they were introduced in 1992 and much has changed since then. The way people purchase holidays has changed. Where once people would buy their package holiday from a travel agent on the local high street—or, the more adventurous, by the exciting new technology of Teletext—increasingly they now purchase holidays online via a computer, tablet or smartphone. That increased choice and flexibility in the travel market, allowing consumers to mix and match components of a holiday to suit them, has also brought about changes in what people purchase: fewer packages and more bespoke travel.

People are empowered to choose from a wider range of accommodation, transport and excursions. According to a recent survey by the Association of British Travel Agents, 83% of consumers bought holidays online in the last 12 months. Such rapid change has left new methods of packaging holidays outside the scope of the regulations, and we want to afford new protections to consumers. It has not always been clear what is in scope of the existing regulations, which has led to an uneven regulatory environment in which traditional package organisers are subject to a level of regulation that many of their online competitors are not. In many cases, the consumer is left unprotected if a company goes bust or something goes wrong. I draw attention to our estimate that, should the regulations not be brought into force, consumers will be at risk of losing out on £90 million of protection each year.

The regulations will address the gap. They are being introduced to ensure that people who book package holidays through travel sites online enjoy the same rights and protections as those who book with a traditional travel agent. That requires a broader definition of “package holidays” to capture modern booking models.

The regulations will introduce a new concept of linked travel arrangements. Those are looser commercial connections than a package holiday, so they have fewer requirements. We are making it a requirement that package travellers be given clear information on what they are agreeing to and what their rights are. We have also strengthened insolvency protection so that consumers can get their money back or be returned home if the company that arranged a package goes bust.

Traders who put such packages together, including those operating through online sites, will now be responsible for the entire holiday, even if services are provided by third parties. One requirement is that the UK must designate central contact points to supervise UK-established package organisers selling into other EU member states. After careful consideration and consultation, we have agreed that the Civil Aviation Authority will take on that role from July. Enforcement of the regulations will be as before, with responsibilities taken on by either the CAA or trading standards.

The Department’s impact assessment, published alongside the regulations, estimates a net cost to businesses of about £100 million a year. However, the changes will level the regulatory environment for all businesses selling travel packages. Companies providing packages not previously covered will be subject to the full range of protections under these regulations, including the organiser taking on liability for all services provided under the contract and providing cover against insolvency.

Right hon. and hon. Members can be reassured that, on the day we leave the European Union, we will maintain our high standards of consumer protection, delivering the stability and continuity consumers need and desire. It is our objective to have effective protections in place for consumers purchasing goods and services cross-border, now and into the future. The way that consumer protections will apply when buying across borders is still a matter for negotiation, but the Government are determined to co-operate closely with our EU partners on matters of consumer protection.

The draft regulations before the Committee have been welcomed as a positive step by the travel industry. Throughout the consultation process and the development of the policy, we sought to strike a balance between increased protections for consumers and minimised burdens on businesses. The measures will ensure a level playing field for businesses and greater clarity and protection for consumers for, we estimate, an extra 10 million package holidays a year. Confident businesses and consumers are an important part of an economy that works for everyone, and these measures will achieve those ends.

--- Later in debate ---

[Andrew Griffiths]

I thank all Committee members for their positive contributions. I hope that I can shed a little more light to clarify some of the concerns and to reassure the Committee that we are in a good place in relation to protecting the rights of consumers when travelling in the UK and abroad.

I am grateful to the Committee for its consideration of the regulations. We all agree that booking package holidays and ensuring that people’s rights are protected, whichever way they book, can be a significant issue for consumers, and one on which we need to offer extra protection.

I thank the hon. Member for Sheffield, Brightside and Hillsborough for the positive way in which she engaged in the debate, as always. It is always a pleasure to debate with her. She asked a number of questions, first about analysis of the effect of organisations in the EU selling into the UK under the mutual recognition principle. The directive will raise the level of insurance protection across the EU and give greater protection. The new directive is far more robust about what insolvency protection must legally be in place. In addition, the central contact points, which I will come on to in a minute, and about which there were several questions, will provide a mechanism for us to monitor other member states’ insolvency regimes, so, in effect, there is extra protection as a result of these regulations.

There were some questions in relation to mutual recognition. Let me be clear: if a UK trader sells a package holiday into another EU member state, he can use the UK insolvency regime, rather than having to comply with the regime of the individual member state. The new mutual recognition principle that is introduced by these regulations makes it easier for UK businesses to sell package holidays across the EU.

[Maria Eagle]

Can the Minister tell us whether that will remain the case after the UK leaves the EU? What assurance does he have that it will?

[Andrew Griffiths]

The hon. Lady will know that, way above my paygrade, detailed negotiations are taking place. She will also know the phrase, “Nothing is agreed until everything is agreed,” which I must repeat. I reassure her that the UK has a great reputation and tradition of being at the forefront of protecting consumer rights. We do not need the EU to tell us how to protect the rights of our citizens and our consumers. We were at the forefront of the free market and of bringing in these protections.

I reassure the hon. Lady not only that these regulations will be copied across, as it were, on the day that we leave the European Union, but that ongoing and positive discussions are taking place to ensure that our consumers are protected when travelling abroad and buying packages or linked travel arrangements across the EU, and that European tourists can have confidence in buying packages from UK operators in future, knowing that their rights will be protected. UK consumer protection rights are based on EU law and they will be retained wherever practical.

There were a number of questions in relation to trading standards departments and their adequacy in providing the resources to support consumers in future. The hon. Lady will know that, through my Department, trading standards receives an annual budget of approximately £40 million, which has been pretty static in recent years. I agree that there are increasing demands on trading standards in a more complex world, in relation to package travel as well as consumer protections and safety. That is why the Government took the bold decision to set up the Office for Product Safety and Standards, which we debated last week, to give extra resource to trading standards across the country and act as a repository of information and expert advice. This year, the Government are putting an additional £9 million into that office and, in future, that budget will be £12 million. I reassure the Committee that the Government are putting extra resources into supporting our trading standards officers across the country.

[Gill Furniss]

I would like to ask the Minister what I probably asked him last week when we debated product safety. Clearly, the £9 million is intended to support the functions of the new office, not the functions of the thing that we are actually debating.

--- Later in debate ---

[Andrew Griffiths]

That is absolutely true, but it is an additional resource for trading standards to try to lighten its burden. If we have a repository of information, expertise and advice in relation to product safety that trading standards officers across the country can access, that will make their job easier and, hopefully, free up their time to support their residents on issues such as those covered by the draft regulations.

I will make some progress. Trading standards and the CAA will enforce this legislation—there was a question about that. Their role is to take action where a number of consumers have been put at risk, such as where the provider has committed a serious criminal offence by failing to put in place appropriate insolvency cover or packages. We have not provided additional ring-fenced funding for that purpose. As the Committee will know, the funding of local trading standards is a matter for local authorities.

Let me move on to consumer protection rights post Brexit. We are committed to maintaining our track record of high levels of protection for consumers, and we do not need to be part of the EU to do that.

The Government are committed to implementing the 2015 PTD. It will provide greater protection to UK holidaymakers by bringing more modern methods of booking package holidays, such as through websites, into scope and giving extra protections. The changes in the regulations will ensure that consumers are better protected. The enhanced regulation will protect an extra 10 million UK package holidays each year.

I recognise that you will spend all your recess in Dundee East, Mr Hosie, serving your constituents, and that you will not have time to take a holiday because you are so committed to them. However, if you are able to do so, you can be sure that, because of the regulations, you can book linked travel packages with greater clarity and certainty. I am sure that that will make for an even more enjoyable holiday. I commend the regulations to the Committee.

Question put and agreed to.

Office for Product Safety and Standards

Andrew Griffiths Excerpts

Wednesday 9th May 2018 Westminster Hall

[Andy Slaughter (Hammersmith) (Lab)]

It is a pleasure to follow my hon. Friend the Member for Poplar and Limehouse (Jim Fitzpatrick) and to serve under your chairmanship, Sir David. I will not repeat what my hon. Friend said, except to say that we are all grateful for the expertise and support that we get in trying to deal with these issues, for your involvement over time and for the Select Committee’s involvement now.

It is probably right to say that the announcement of the new office was rather subdued. I think that it came at a weekend; we were all expecting an oral statement or at least some explanation of its role, but we have had to wait really till today to address that matter. I am grateful to my hon. Friend the Member for Swansea East (Carolyn Harris) for initiating the debate and for her expertise on the matter.

We know what needs to be done. We had the Lynn Faulds Wood report two years ago. We had the Government’s own working party report. We have had much expert advice, including from the London fire brigade, Which? and Electrical Safety First. The difficulty is that not much is happening. There is a fear—if I can be blunt with the Minister—that this is really window dressing; it is simply a way of being seen to do something. We are told that it is a new office and has additional funding—£12 million. Can the Minister confirm, first, that that is additional money? Secondly, I think that that is when it is fully operational. When will the office be fully operational in that way? Its remit appears to be quite limited. It appears to be mainly the same people doing the job, and it appears to have the same limitations because of the reliance, still, on the local network of underfunded trading standards organisations.

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Andrew Griffiths)]

Perhaps I can put the hon. Gentleman’s mind at rest. I can confirm that we are talking about £12 million of additional resources for the Office for Product Safety and Standards. In this first year, we envisage there being an additional spend of approximately £9 million; that is as it staffs up and gets itself ready. But there will be £12 million of new money, in addition to the work that the officials have already been doing within the Department for Business, Energy and Industrial Strategy.

[Andy Slaughter]

I am grateful for that answer. Perhaps, because of the limited time, I will limit myself to making one point. Will the new office pass the Whirlpool test? Whirlpool is untypical in some ways, because one particular design fault has affected 5.5 million tumble dryers; I think it was estimated that one in six homes in the country are affected. That is not the only problem with Whirlpool. We have also had the issue that led to the Llanrwst inquest and the sad, tragic deaths there. The Whirlpool reaction has been extraordinarily unhelpful. If the office can deal with Whirlpool, it can probably deal with a number of other issues.

I remind Members that over 12 years a number of different brands manufactured tumble dryers that were liable to catch fire and did in many hundreds, if not thousands, of cases. The concentration was initially on the slow speed at which they were repaired or replaced and then the fact that half of them were not identified at all. That threw up the lack of a registration or recall process. Whirlpool persistently resisted a recall or even giving the correct safety advice. That is bad enough, but through Which? and the BBC’s “Watchdog” programme—which has done an incredible job in exposing this negligent behaviour by Whirlpool and is now being broadcast weekly—we have discovered that that was not the only problem.

The replacement and repaired machines were themselves faulty and large numbers of them are now catching fire. We could well be back where we were, except for the fact that people have been lulled into a false sense of security in the belief that they now have safe goods in their home when they often do not. How does the Minister intend to approach the Whirlpool issue and learn from it? Will we have a proper registration process? Will we have a clear database of products that are at risk and are recalled? Will we insist on recall, rather than this rather botchy repair method? Will that be within the remit of the new office?

Finally, we are coming up to the first anniversary of the Grenfell Tower fire, which we are dealing with on a daily basis. It was started by a particular type of fridge freezer. If the Minister cannot answer this question now, I would be grateful if he would write to me. I have had contradictory answers from his Department and the Ministry of Housing, Communities and Local Government. When will we get a verdict on that? Is it coming through the police inquiry or his Department? When will we know exactly which fault caused that fire? We know it is in a particular model of fridge freezer, but we need to know more, because if there is a further risk, it needs to be demonstrated and publicised.

--- Later in debate ---

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Andrew Griffiths)]

It is a pleasure to serve under your chairmanship, as always, Sir David, with your vast experience of this place. I congratulate the hon. Member for Swansea East (Carolyn Harris) on securing this important debate, and I am grateful to hon. Members from both sides of the House for their thoughtful input. The hon. Lady is a true champion for her constituency, as I know from my work on the Parental Bereavement (Leave and Pay) Bill. She has made a huge contribution to the lives of people across our country, and I commend her not only for the work that she does, but for the way in which she does it.

Let me be clear that there is no doubt about the Government’s commitment to maintaining the highest level of consumer protection. I have a wide and varied brief. As the Minister responsible for small business, consumers and corporate responsibility, I cover postal issues, competition policy and retail. I lose track of the number of things that should be on my business card, but it would not fit in my pocket if it had everything on. I reassure the Chamber that consumer protection is of the utmost importance, however, and if anything keeps me awake at night, it is ensuring that this country has a product safety regime that keeps us all safe. The Government’s commitment led to the first ever national technical expertise to support local authority trading standards teams in their vital work of enforcing product safety.

There were some questions about the announcement in relation to the Office for Product Safety and Standards. I put my hands up; it was my first week as a Minister. I thought it was better to get the information into the public arena and for people to be aware of it. If there are suggestions that I should have come to the House or done it differently, I take them on board. We are always learning.

I announced the establishment of the Office for Product Safety and Standards on 21 January. That announcement responded to the central recommendation made by the working group on product recalls and safety. That group was set up by the Government to advise on the practical steps that could be taken to enhance the UK’s approach to product safety. It identified a need for a national technical and scientific resource to support decision making in local authorities and in the businesses they regulate. We will deliver that national capability through the Office for Product Safety and Standards. I have high ambitions for what the office will be able to achieve, and I am determined that the capability will be established quickly.

Since establishing the office, we have taken steps to deliver improvements, which I will say more about shortly, but it might be helpful to remind hon. Members where the responsibilities within the product safety regime lie, so we are clear about exactly where we should expect the office to deliver improvements. It has not been set up to do what others are already doing or should be doing.

Businesses are legally responsible for ensuring that the products they place on the market are safe, and for taking effective action to address any issues that arise once those products are in circulation. The Office for Product Safety and Standards does not take those responsibilities away from businesses, nor does it lessen them in any way. It gives us the scope to better enforce those requirements more consistently across the country.

Day-to-day enforcement of product safety is led by local authorities, which have teams of officers on the ground across the country, as we have heard. In that role, they provide vital services, such as being a point of contact, giving advice to consumers and businesses, and leading on investigations into potential non-compliance. I pay tribute to the work that trading standards officers do across the country. The establishment of the office does not move, alter or reduce that role. Local authorities remain front and centre in the delivery of effective protections.

The office will provide additional support for those local teams, who will be able to draw on the national testing facilities, leading scientific advice and technical expertise to help them to deal with the complexity of the issues they encounter. We have heard about the challenges in relation to resource, but this is a new, additional resource of additional expertise to help and support those trading standards officers across the country.

To clarify, the new office will have a budget for new product safety activities of an additional £12 million a year. As I said earlier, the budget for the first year in operation, 2018-19, is about £25 million, which includes £9 million of additional funding. In the following year, that £9 million will increase to £12 million. Those are substantial amounts of resources. The office will employ about 290 people, of whom 180 will be existing staff and 110 will be new posts. I hope that reassures right hon. and hon. Members.

[Stephen Kerr]

Will the new office that the Minister is describing in great detail have the power to hold to the fire the feet of big organisations, such as Whirlpool, in favour of consumers?

[Andrew Griffiths]

I absolutely reassure my hon. Friend. I think he won the prize for the best pun today when he talked about the spin cycle of those large companies. I noticed it, if nobody else did, and laughed internally. Clearly, the office has to have the teeth and the capabilities to hold those businesses to account. I reassure him that it will.

[Andy Slaughter]

I think the Minister has said that one of the office’s duties will be to maintain a recall register. How is that progressing, and will manufacturers be under an obligation to ensure that the register is notified of all recalls?

[Andrew Griffiths]

I confirm that there is an obligation in place for manufacturers to notify the Office for Product Safety and Standards. I will come on to how the database will work further on in my speech.[Official Report, 15 May 2018, Vol. 641, c. 2MC.]

Within the office, we are applying lessons from regulators such as the Food Standards Agency, which is a national regulator that deals with significant volumes of product incidents and provides national scientific expertise to local authorities. So we are not creating something new; we are learning the lessons from previous regulators to ensure that the office works properly. We are also applying the lessons learned from international comparators—the OECD and American counterparts—and we are in the process of building national capacity.

Through the OPSS, the Government have already led the development of a code of practice for product recalls and corrective actions, working with the British Standards Institution. The code provides greater clarity for businesses on what they should do in such cases. It also provides a framework for local authorities when they engage with businesses to support and enforce programmes of corrective action.

There was a question about how the OPSS will support trading standards officers. I can confirm that so far, more than 250 local authority officers have received training on the new code and as a result they are now better equipped to deal with incidents.

[Gill Furniss]

Although the Minister said earlier that there are 290 posts at the OPSS, it looks as though there is little resource in terms of extra staffing or extra funding for local trading standards officers. Is that correct?

[Andrew Griffiths]

To clarify, as I said before, there are 110 new posts at the OPSS, with an additional resource of £12 million; I think that is a substantial amount of money. The Government are properly resourcing what we accept is a vital facility.

As we build the office over the coming year, the Government will continue to consult on aspects of its functions and on its long-term scope. I think there has been some question about whether it should remain in the Department for Business, Energy and Industrial Strategy or be an independent body. We will consult on that and on the case for changes to its legal powers.

The hon. Member for Swansea East mentioned the work of the all-party parliamentary group on home electrical safety, and I commend that work. I have read a number of the reports and documents that it has produced, and they were helpful to me. I also pay tribute to the Business, Energy and Industrial Strategy Committee, and to the hon. Member for Leeds West (Rachel Reeves) for the work that she has done. That work demonstrates the desire to work across parties and to ensure that we get this matter right for all our constituents.

[Holly Lynch (Halifax) (Lab)]

In the spirit of cross-party working, the Minister might remember that on 29 January he responded to a Westminster Hall debate on a petition calling for greater regulation of the sale of fireworks. In response to an inquiry from my hon. Friend the Member for Poplar and Limehouse (Jim Fitzpatrick), he said that, regarding the sale and regulation of fireworks, “this new body” would

“—where necessary—come forward with suggestions and advice to Government.”—[Official Report, 29 January 2018; Vol. 635, c. 261WH.]

He also committed to arranging a meeting with all those Members who were interested in the regulation and sale of fireworks. Has there been any progress on that particular issue?

[Andrew Griffiths]

I thank the hon. Lady for that question. She has reminded the hon. Member for Poplar and Limehouse (Jim Fitzpatrick), who said that this debate was the first time that he had heard me speak as the Minister, that this is actually the second time that he has done so; that was a very useful debate. My understanding—I look to my right, at my officials—is that officials were in the process of setting up that meeting. If they have not done so, I will chase that up; it should take place, because it is an important meeting and I want it to happen.

The hon. Member for Swansea East asked what the OPSS was doing to discuss electrical fire safety with the Home Office; that is important. The OPSS is building up its intelligence-gathering capability and will use a database and evidence to help to identify and prioritise products that pose higher safety risks to consumers. The OPSS is also represented on the Home Office’s fire statistics users group and we are in regular—almost daily—contact across Government to ensure that these activities are properly joined up.

The hon. Lady also specifically mentioned online selling, which is very important. Action is being taken by law enforcement agencies against the sale of counterfeit goods at local markets and car boot sales, through social media channels such as Facebook and facilitated by fulfilment houses.

The hon. Lady mentioned the issue of Amazon giving evidence to her all-party parliamentary group. I put on the record that I understand the point she made, and I agree with her that it would be valuable for the APPG to engage constructively with Amazon. I am sure that others outside this place have heard her comment and will respond to her in the near future; she should let me know if they do not.

Existing legislation applies to online retailers and they have a responsibility for the products they sell. As we have heard, the Intellectual Property Office works closely with Electrical Safety First; I commend the work that that charity does to highlight how to identify fake electrical goods that are being sold online.

One of the reasons for creating the OPSS is to enable the UK to meet the evolving challenges of product safety by responding to the increasing rate of product innovation, the growth of online shopping and trading portals, and expanding international trade.

I was asked whether private sales—consumer to consumer, on websites such as eBay—are regulated. Consumer-to-consumer sales are not covered by the Consumer Rights Act, other than in relation to things such as secondary ticketing. However, as we have heard today, there is a current consultation—a Green Paper—that I have launched, which specifically asks whether more protection is needed in this area. If the hon. Lady would like to contribute to that consultation, I would certainly be interested in hearing her views.

Over the past three years, National Trading Standards has had a core budget of £40 million to work with local authorities to tackle harm in this area. There was also a question in relation to the injury database. The injury database was scrapped in 2002, and at present there are no plans to reinstate it. However, the OPSS is considering how to ensure that it has access to the best information, and we always keep abreast of these things and will consider the future as we go forward.

My hon. Friend the Member for Stirling (Stephen Kerr) raised the issue of regulators and their powers. The White Paper specifically asks whether regulators need more powers, so he might want to have a look at it.

The hon. Member for Poplar and Limehouse asked whether businesses will be required to notify the OPSS; I think that I have already confirmed to him that they will absolutely be required to do so.

Then there is the issue of selling second-hand goods subject to recall. Under the General Product Safety Regulations 2005, there is a requirement for sellers of second-hand goods not to sell goods that they know are unsafe.

I was asked what will happen on our exit from the EU. Of course, unsafe products will remain a serious risk. UK enforcement authorities are currently reliant on EU systems, such as Rapex, as the hon. Member for Swansea East mentioned. However, BEIS is developing new systems to enable regulators to identify new threats quickly, to mount co-ordinated and rapid responses, and to target and intercept products, including imports.

The hon. Member for Kingston upon Hull West and Hessle (Emma Hardy) raised the issue of boots. I can tell her that safety boots are regulated under the personal protective equipment regulations. Manufacturers have a legal obligation to ensure that they are safe, and trading standards officers have the powers to act if necessary. If the hon. Lady provides me with the details, I will ask the OPSS to work with trading standards officers to look into the case for her.

What else have we had? I think that the Business, Energy and Industrial Strategy Committee has pointed out that we intend to undertake a further upgrade of the Government’s product recall website; that issue was raised earlier. We recognise that this website is important and we will put extra work into it. I hope that reassures the hon. Member for Hampstead and Kilburn (Tulip Siddiq). She mentions that mums are concerned about bottle warmers and baby seats. I would say that it is not only mums who are concerned; as a new dad myself, I know that dads are also concerned. I can correct her by saying that they are no longer called baby seats; I think they are now called travel systems. That was news to me, but we are always learning as we go, are we not?

The hon. Member for Strangford (Jim Shannon) made some very important points. I commend him on the fact that he has spoken in some 379 debates in the last year. If only our products were as reliable as he is, we would not need this new office. However, I point out to him that currently the number of questions that he has asked stands at 666, so he might want to ask another question shortly.

The hon. Member for North Ayrshire and Arran (Patricia Gibson) mentioned Which? I think we all recognise the important role that Which? plays in consumer protection. I can confirm to her that I am meeting its managing director next week and I can also confirm that the OPSS is working closely with Which? in a number of areas and has had regular meetings with it. I hope that reassures her.

I was also asked about the Grenfell fridge. Clearly, that issue is a priority. A thorough safety investigation has taken place and I hope to be able to come forward with information for the House in the very near future.

In closing, I reassure the House that this Government take the issue of product safety incredibly seriously. We have to get this matter right for all of our constituents. As the Minister responsible, I confirm that the Department and the new OPSS will continue to engage with parliamentarians to ensure that we get it right. I thank the hon. Member for Swansea East for securing this debate.

Question put and agreed to.

Resolved,

That this House has considered the role of the Office for Product Safety and Standards.

Business Update

Andrew Griffiths Excerpts

Wednesday 9th May 2018 Written Statements

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Andrew Griffiths)]

Under section 2 of the Immigration Act 2016 the Director of Labour Market Enforcement is required to prepare an annual strategy which, once approved, must be laid before Parliament.

The Director of Labour Market Enforcement is a statutory appointment under the Immigration Act 2016. The Director is responsible for setting the strategic priorities of the three existing enforcement agencies. These are the Gangmasters and Labour Abuse Authority, the Employment Agency Standards Inspectorate, and HMRC’s National Minimum Wage Enforcement team.

Professor Sir David Metcalf CBE was appointed as the Director on 1 January 2017. Sir David’s introductory independent labour market enforcement strategy was published in July 2017 and today this second strategy is being published. This strategy provides a valuable assessment of the existing scale of labour exploitation and makes 37 recommendations on labour market enforcement and raising awareness of employment rights.

There is significant crossover and alignment between this strategy and the Government’s response to the Taylor Review of Modern Working Practices and subsequent consultations. The Government will publish a response to the Director of Labour Market Enforcement’s strategy later this year, once the consultations have closed and the Government have considered the responses.

The Government’s Good Work plan is a vital part of the industrial strategy, the long-term plan to build a Britain fit for the future by helping businesses create better, higher-paying jobs in every part of the UK.



I would like to place on record my thanks to Sir David and his team for the hard work that has gone into this second strategy.

Copies of the strategy have been laid before both Houses.

[HCWS670]

National Living Wage: Under-25s

Andrew Griffiths Excerpts

Thursday 3rd May 2018 Commons Chamber

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Andrew Griffiths)]

It is a great honour and privilege to respond to this debate, and I congratulate the hon. Member for Glasgow East (David Linden) on securing it. I am pleased to be able to contribute to it as the Minister responsible for the national minimum wage and for the national living wage, of which the Government are hugely proud. There have been age-specific minimum wage rates in one form or another since the national minimum wage was introduced by the Labour Government in 1999, and lower pay rates have always been in place for younger workers because the priority for them is to secure work and gain experience. A higher minimum wage for young people could adversely affect employment levels for that group by dissuading employers from taking on less experienced workers.

It was remarkable that, in the 17 or so minutes for which the hon. Gentleman spoke on this issue, he failed to mention the facts—the actual unemployment rates among young people—even once, so let me bring them to his attention. Unemployment is higher among young workers than among older workers. Specifically, between December last year and February 2018, unemployment among those aged 25 and over was at a record low of 3%, yet among 18 to 24-year-olds the unemployment rate was 10.3%, and more than one in four 16 and 17-year-olds are unemployed. The hon. Gentleman says that we should focus on individuals rather than on statistics, but those statistics clearly show the impact that his policy would have on those young people’s ability to get into work.

[Chris Stephens]

The Minister highlights the UK Government’s appalling record on youth employment. Can he explain to me—we have asked this question repeatedly—why the Conservative Government took the decision to introduce an additional age tier to the national minimum wage rates, and why the age of 25 was picked?

[Andrew Griffiths]

The Government have always listened to the expert advice. In particular, we listen to the Low Pay Commission, which is made up of employers, academics and experts in the field and trade union representatives and is specifically devoted to protecting the rights of workers, including young workers. It is the commission that says that this policy is right and that sets the lower rates after considering all the facts.

[Kirsty Blackman]

The Minister has laid the stats before us, saying that the unemployment rate is 3% for over-25s and over 10% for under-25s. Does he not agree that that shows that the system he is presiding over is broken, and that something needs to be done to fix it?

[Andrew Griffiths]

No, I think it shows two things. It shows that the hon. Lady does not understand the labour market, and it shows the difficulties that young people have in demonstrating that they have the necessary skills, in gaining the necessary experience and in convincing employers to take a risk in taking them on and giving them an opportunity.

The hon. Member for Glasgow South West talked about our record in relation to unemployment. I will just remind the House that we are seeing record levels of employment in this country, and that unemployment rates are lower than we have seen for 40 years, so I will take no lessons from him.

[Several hon. Members rose—]

--- Later in debate ---

[Andrew Griffiths]

I think I have given way quite enough, so I will make a little progress. Forgive me, but I am sure that Members will have an opportunity to come in shortly.

Academic evidence shows that the youth labour market is much more sensitive to economic shocks than the labour market in general, and that young people can be exposed to longer-term scarring effects from prolonged spells of worklessness than others. As I said, the independent Low Pay Commission backs up that research. Its 2015 report, which I urge the hon. Member for Glasgow East to educate himself with, cites New Zealand research that found a 3% to 6% fall in the employment rate for 16 to 17-year-olds two years after a 28% increase in the real value of their minimum wage. The hon. Gentleman talked about fairness, but there is nothing fair about making it harder for young people to get on the jobs ladder.

[David Linden]

The Minister will remember that I referred to Katie, a young girl who was struggling to get the bus fare to go to work. How does that tie in with what he says? She is struggling to get to work; she does not have the pay to get to her job. Is that part of the reason why young people cannot get into work?

[Andrew Griffiths]

I recognise the hon. Gentleman’s point, but it would be even more difficult for Katie were she not to have a job. That opportunity, that experience, that foot in the labour market is hugely important. The hon. Gentleman would deny Katie the opportunity to get vital work experience and make her way in the jobs market.

We are rightly more cautious about young people when setting the pay floor, and a lower minimum wage for younger workers is in keeping with international comparators. The hon. Gentleman referred to two countries, but let me clarify something and educate him a bit. Just under two thirds of OECD countries that have a statutory minimum wage have special rates for young people. Minimum wages are adjusted for young workers in France, Ireland, Belgium and Luxembourg, among many others. He may want to look into that.

Pricing young people out of the labour market by setting their minimum wage too high would be detrimental to the workers whom the policy was intended to benefit. That said, the Government set only the minimum pay threshold, and I commend businesses that choose to pay their younger workers higher rates of pay, and in some cases pay them the higher national living wage. Indeed, in April last year, 88% of 16 and 17-year-olds, 90% of 18 to 20-year-olds and 92% of 21 to 24-year-olds were paid above their age-applicable minimum wage. Those are the facts, whether the hon. Gentleman likes them or not. As a matter of fact, 86% of 21 to 24-year-olds were paid at or above £7.50 an hour, which was the national living wage for the over-25s.

[Chris Stephens]

The Minister is doing his best to do a pantomime villain routine, but he seems to be confusing himself. Will he clarify whether he is suggesting that under-25s are better off working in the public sector? Will he confirm that in his Department the under-25s get the same rates of pay as the over-25s?

[Andrew Griffiths]

I will confirm to the hon. Gentleman that not once in this debate has the Scottish National party mentioned the impact that such a change would have on businesses.

[Several hon. Members rose—]

[Andrew Griffiths]

I have given way plenty enough; we will move on.

The Government have increased the national minimum wage for young people to record levels. As I am sure the hon. Member for Glasgow East is aware, last month the Government gave the lowest-paid workers an above-inflation pay rise, as the national living wage and all the national minimum wage rates increased in real terms. The national living wage increased by 33p, to £7.83, meaning that a full-time worker on the national living wage will see their annual earnings rise by more than £600. Following increases to the personal allowance threshold and the minimum wage, a full-time worker earning the national living wage will be taking home over £3,800 a year more after tax. That is something this Government have delivered and are incredibly proud of.

[Kirsty Blackman]

Will the Minister give way?

[Andrew Griffiths]

I think I have given way enough.

The national living wage will rise further to reach 60% of median earnings in 2020, subject to sustained economic growth. We have awarded younger workers in receipt of the national minimum wage the biggest hourly pay rise in more than a decade. In particular, 20 to 24-year-olds saw a 33p increase in their hourly rate to £7.38, meaning a full-time worker in that age group will see their earnings rise by £600 a year, like those aged 25 and over in receipt of the national living wage. Those aged 18 to 20 saw an annual increase of 5.4% to £5.90, and those aged 16 and 17 are now entitled to a minimum of £4.20 an hour, an annual increase of 3.7%. Finally, apprentices aged under 19, or those aged 19 and over in the first year of their apprenticeship, saw an increase of 5.7%, the largest annual increase of all the hourly rates. In total, we believe that more than 2 million workers, 400,000 of whom are young workers under 25, have directly benefited from the latest increases in the national minimum wage.

[David Linden]

Will the Minister give way?

[Andrew Griffiths]

For the last time.

[David Linden]

My previous dealings with the Minister were in Committee on the Parental Bereavement (Leave and Pay) Bill, and I came into the Chamber today with a due amount of respect for him. The patronising tone he has taken in this debate demeans his office, and I hope he will reflect on that afterwards.

[Andrew Griffiths]

rose—

[David Linden]

The Minister should have a wee seat, because I am not finished.

Will the Minister put it on record that a 21-year-old first-year apprentice can still be paid just £3.70 an hour? Would he be happy being paid £3.70 an hour?

[Andrew Griffiths]

I spend a lot of time talking to apprentices, and I see the vast contribution that apprenticeships make to those young people. Apprenticeships provide them with the opportunity to earn and learn, to gain vital experience and to have on-the-job training while following a vocation. That is hugely important. I have spoken to apprentices, and they value the apprenticeship scheme. They are building their careers thanks to it.

Raising the national minimum wage forms part of our long-term industrial strategy to boost productivity and to create good jobs and greater earning power for all parts of the United Kingdom. That is absolutely central to creating an economy that is fair and that works for young people.

All the increases were recommended by the independent Low Pay Commission, in line with the annual remit issued by the Government. The world-renowned LPC brings together business and worker representatives to form a consensus on the appropriate minimum wage rates. As ever, I thank the LPC for the extensive research, consultation and analysis it undertakes throughout the year to inform its recommendations.

Previous LPC reports discussed various pieces of research showing that higher youth wage rates can have a negative impact on employment rates. Consequently, in the annual remit, the Government asked the LPC to recommend the highest increase in national minimum wage rates that were possible without damaging the employment prospects of low-paid young workers by setting them too high. The Government will continue to take the LPC’s advice when setting all the wage floors in order to ensure that minimum wage rises are balanced between rewarding workers and ensuring that they are not priced out of employment. We are not complacent, and that is why I am pleased that the LPC will conduct a review of whether the current structure of the youth rates best supports our aim. I look forward to the LPC’s advice on the matter in spring 2019.

I recognise the hon. Gentleman’s concerns about young people, but the Government are committed to supporting them. Specifically, the Department for Education is reforming technical education by introducing T-levels to equip young people with the relevant skills to reach their potential, and the Department for Work and Pensions has launched the youth obligation support programme for 18 to 21-year-olds who are making a new claim for universal credit. The programme provides valuable intensive support to help people move into work. The DWP announced at the end of March that all 18 to 21-year-olds in receipt of universal credit will be entitled to claim support for housing costs, and that change is currently in the process of being implemented.

This Government are committed to building an economy that works for everyone, including young people. By having a lower national minimum wage for under-25s we are protecting young workers, to help them gain crucial experience, as well as supporting their transition and progression from education into the jobs market. Getting on to that all-important first rung on the jobs ladder has to be the priority. The independent Low Pay Commission will continue to make recommendations on the national minimum wage, and I look forward to its advice in spring 2019 on whether the current structure of the youth rates best supports the youth labour market. This Government have the economy, the country and the interests of young people at their heart.

[David Linden]

On a point of order, Madam Deputy Speaker. During his speech, the Minister perhaps inadvertently misled the House by saying that France has different pay levels for young people. What opportunities are available for him to correct that, as I believe it is not actually true?