Ethnicity Pay Gap Reporting

Baroness Prashar Excerpts

Monday 25th October 2021 Lords Chamber

[Baroness Prashar (CB)]

My Lords, I thank the noble Lord, Lord Boateng, for securing this short but very important debate. He spelled out clearly both the moral and practical cases for ethnic minority pay gap reporting. It is a pleasure to follow my noble friend Lady Falkner. I agree with all she said. Her experience shows the importance of pay gap reporting.

The Commission on Race and Ethnic Disparities, which the Government set up, did not recommend statutory reporting of the kind in place since 2017 for gender pay. Do the Government accept its recommendation and the rationale advanced by it for not making ethnicity pay gap reporting mandatory? As we have already heard, following the publication of this report, the CBI, the TUC and the EHRC, among others, urged the Government to introduce mandatory ethnicity pay reporting.

The number of companies calculating their ethnicity pay gap voluntarily is growing. For example, Business in the Community found that one in 10 large companies reports on its ethnicity pay gap voluntarily, so there are good examples of how this can be done.

Those who are reluctant to report have advanced practical difficulties in gathering this data as a reason for not making pay gap reporting mandatory. Examination of these arguments shows that practical difficulties can be overcome; we must not make the best the enemy of the good. Arguments about complexity are not a convincing reason for not making pay gap reporting mandatory. Furthermore, pay gap reporting is not intended as a perfect statistical tool but a helpful snapshot as a guide for further probing and consequent action. As others have said, it not a silver bullet but one other important tool to assist action on promoting equality of opportunity.

The benefits of gathering and publishing this data with explanatory narrative are many. It prompts companies to examine and have conversations about what is happening in their organisations and take appropriate action. It catalyses action. As the noble Lord, Lord Boateng, said, the Government conducted a consultation on pay gap reporting in 2018-19. Will the Minister tell the House when the Government will publish the results of this consultation and their response to the report of the race disparity commission? Action is needed—we cannot wait any longer.