Gender pay gap reporting provides transparency for everyone in holding employers to account, and many organisations already recognise that closing the gap makes good business sense. I am writing to public sectors employers who are within scope of the regulations to urge them to develop action plans, and meeting influential business leaders to press them to take action in their sectors to make the best of the potential that their female employees can provide to them.
Before I answer that, I feel obliged to wish my hon. Friend good luck in the London marathon this weekend, as I do to all Members of this House who will be running those 26 miles—we hope it will be good weather.
I am sure the whole House joins me in being delighted that we have exceeded last year’s compliance levels, with 95% of all employers believed to be in scope in the regulations having reported their data by the deadlines. We are confident that 100% compliance will be achieved shortly, and we have already seen the reporting rates rise to 98%.
When across 45% of firms the discrepancy in pay increase is in favour of men this year, it is now clear that the Government’ s policy of asking companies simply to report on the gender pay gap is not enough. I welcome the Minister’s response to the question about encouraging people, but will she now heed our advice and make it mandatory for companies also to produce action plans on how they will defeat this inequality against women?
I thank the hon. Lady for her question, and I know she shares my enthusiasm and determination on this point. She will be pleased that already just under 50% of employers within scope are publishing their own action plans—they are doing that because they understand it makes good business sense. We believe that this is the best approach. Interestingly, 56% of employers have reported either reductions in their gender pay gaps or the fact that they are staying the same. There is a great deal of work to do, but we have to bring business with us; businesses have to realise that it makes good business sense to close their gap and to treat their female staff properly. We believe that by encouraging them we will bring about the best result.
I welcome the progress that has been made in closing the gender pay gap and increasing the representation of women on company boards, but what are the Government doing to support low-paid, low-skilled women, who often seem to be left out of the conversation?
My hon. Friend has distilled into his question the important point that the gender pay gap is not just about the heads of companies—directors and so on—important though that aspect is; it is also about helping women at the very lowest ends of the pay scales. We want to encourage them to seek better jobs and have better incomes. That is precisely why my right hon. Friend the Minister for Women and Equalities is setting out a strong strategy on economic empowerment for women, so that they are treated fairly in the workplace, no matter their pay level, and ensuring that employers realise that if they are going to get the best of their workforce, they need to pay their female staff properly.