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Conservative MP George Freeman “politics of envy” comment provokes Labour outrage

PUBLISHED: 11:43 03 March 2015 | UPDATED: 13:37 03 March 2015

George Freeman MP  Picture: Ian Burt

George Freeman MP Picture: Ian Burt

Labour has hit out at Norfolk MP George Freeman for claiming that prosecutions to enforce the minimum wage may only “satisfy the politics of envy”.

The exchange

Stephen Doughty: I am very interested in what the Minister has to say, but again I ask him how many prosecutions there have been for non-compliance with the law. That goes to the heart of whether the legislation is being used effectively, and his claims about what the Government have been doing. Anecdotally we hear every week of companies that are not behaving as he set out. The Minister said that 163 have been named and shamed, which seems a low number.

George Freeman: As I understand it, the number of prosecutions formally brought and completed is nine, and the number of named and shamed employers is 162. What I want to highlight is the track record and compliance level—the level at which national minimum wage enforcement is being complied with. That is the key figure. Ultimately we want a world with no prosecutions because there is total compliance.

Stella Creasy: Will the Minister talk us through the consequences to companies of not following the regulations? If the number of prosecutions is so low, and those who are named and shamed can bear the brunt of not being popular, is there really any consequence of not paying all those low-paid workers?

George Freeman: As I set out in my opening remarks, there are very heavy penalties. The hon. Lady may not ever have run a business, but I assure her that for people who do so fines and reputational damage are a major force for compliance. Prosecutions may satisfy the politics of envy of the Opposition, but they are not the best mechanism to drive compliance. The fact is we are trying to drive a system in which employers, the vast majority of whom are responsible, comply properly.

Shadow business minister Stella Creasy said she was shocked by his remarks, claiming prosecutions were the “politics of justice”.

Business minister George Freeman, who was speaking in a committee yesterday on draft National Minimum Wage Regulations made the comment when replying to questions from Ms Creasey and Stephen Doughty about the number of prosecutions against companies which had not paid the minimum wage.

Mr Freeman told MPs that the Government had brought and completed nine prosecutions, and the number of named and shamed employers was 162.

He said: “As I set out in my opening remarks, there are very heavy penalties. The honourable lady may not ever have run a business, but I assure her that for people who do so fines and reputational damage are a major force for compliance. Prosecutions may satisfy the politics of envy of the opposition, but they are not the best mechanism to drive compliance. The fact is we are trying to drive a system in which employers, the vast majority of whom are responsible, comply properly.”

Mr Freeman took to social media this morning to point out that he had announced new measures to ensure employers pay a minimum rate, writing on Twitter: “Proud to announce package of measures in House yesterday to drive compliance by all businesses to implement #NationalMinimumWage”

But speaking after the committee Ms Creasey told the Mirror: “I want to know whether David Cameron thinks prosecutions for breaking the law is just the politics of envy.

“There are five million people on low pay for whom the minimum wage is a bedrock. They would say differently.”

Mr Doughty, who also challenged Mr Freeman, told the Mirror: “I find it extraordinary that the minister was forced to admit this shocking low level of prosecutions.

“And his subsequent comments about the politics of envy show just how out of touch he is about people having to live on low wages across Britain.”

Mr Freeman said: “This is another example of scurrilous electioneering from the Labour party. My speech yesterday was actually setting out measures to clarify the law in this area, which will improve compliance and protect lower paid workers by making sure everyone who is entitled to the minimum wage receives it.

“The Government is committed to supporting low paid workers and we have put in place a package of fines and other measures to get tough on employers not paying the minimum wage: increased resources for HMRC to pursue compliance; tougher penalties for employers who break minimum wage law from 50pc to 100pc of the unpaid wages owed to workers; and increased the maximum penalty from £5000 to £20,000.

“Changes to the Government’s naming scheme also mean that more employers have been and will continue to be named for making underpayments. The Government have already named 162 employers, and is committed to making sure everyone who is entitled to the minimum wage receives it.”

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