Zero-hours Contracts

Part of the debate – in Westminster Hall at 4:18 pm on 19th March 2014.

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Photo of Jennifer Willott Jennifer Willott The Parliamentary Under-Secretary of State for Women and Equalities, Assistant Whip (HM Treasury), The Parliamentary Under-Secretary of State for Business, Innovation and Skills 4:18 pm, 19th March 2014

I was about to come to exactly that point. We are aware that low pay is an issue for workers, particularly in the care sector, as hon. Members have highlighted. As the right hon. Gentleman just pointed out, HMRC enforces the minimum wage on behalf of the Department for Business, Innovation and Skills, and it has been conducting enforcement activity in that sector. In November, it published a social care evaluation, which highlighted a very worrying level of non-compliance. In 51% of the cases that it inquired into, the minimum wage was not complied with, and it identified more than £400,000 of pay arrears.

The Government are trying to improve compliance partly by significantly increasing the penalties so that they act as a more effective deterrent, and HMRC is currently targeting enforcement activity on the care sector in particular. We have also revised the naming-and-shaming scheme—the most recent batch of names was published a couple of weeks ago—and it is now much simpler to name and shame employers that break national minimum wage law. We are trying to ensure that we are taking more targeted action, but also that the penalties are greater, both financially and in terms of naming and shaming, so that they will act as a more effective deterrent.

The hon. Member for Wirral South asked about working across Government on the issue of zero-hours contracts and procurement. Officials have spoken with the Cabinet Office in relation to Government contracts, procurement and zero-hours contracts. We are also working with the Department of Health regarding the use of zero-hours contracts in social care. The discussions are ongoing, and the information gathered during them is also being fed into our consultation response. This is a very complicated issue and, as hon. Members have highlighted, it is of great importance to tens of thousands of people throughout the country. We had more than 36,000 responses to the zero-hours contracts consultation, which closed last week, so people clearly feel very strongly about the issue. We are looking at the responses to the consultation and will publish our response very shortly. I hope that that will respond more broadly to some of the issues highlighted by hon. Members today. I congratulate the hon. Member for Wirral South on securing the debate, because it is a very important issue. We all have constituents who have it right at the top of their agenda, and the Government are working on it.