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Meg Munn MP - Sheffield Heeley's voice in Parliament | Welcome
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The Gender Pay Gap

Thursday, November 10, 2005

At a conference organised by Personnel Today on the ‘Gender Pay Gap’ Meg gave the following address.

 

I’d like to thank Noel O’Reilly and Personnel Today for putting on this extremely important conference today.

 

The timing of this event could not have been better.  Only this morning the Office of National Statistics have revealed that the full time median gender pay gap is 13.2 per cent - a mark of progress - reduced from 14.4 per cent in 2004. This is an achievement that we can all be proud of.   One that we must continue to build upon.  

 

As a country, we have made progress in tackling the inequality in pay from the staggering 30 per cent 30 years ago to the 13.2% it is today for full time workers. This shows gradual improvement for full time working women; however it still means that for every pound earned by a man, a woman will only earn 86p. 

 

The government wants to see further and faster progress made on reducing the gap between men and women’s pay. The Prime Minister set up the Women and Work Commission to examine the problem of the gender pay gap and other issues affecting women's employment - to provide concrete recommendations for closing the gap. 

 

I look forward to their report, which will be presented to the Prime Minister early in the New Year. I know that some of the key areas that the Women and Work Commission have examined include the skills shortages and access to all important life-long learning. Baroness Prosser, who chairs the commission, will enlighten you this afternoon on their work.

 

The gender pay gap isn’t just bad news for women.  It’s bad news for business and the country. The economy is working below its productive potential if women are working in lower skilled roles, in jobs that do not fully use what they have to offer.

 

This has negative consequences for growth in the economy.  As the labour market is tight in many parts of the UK, increasing women’s participation in all sectors could help to reduce skill shortages - especially in the important and expanding high-value growth sectors.

 

That is why we have put so much emphasis on tackling the gender pay gap - it is good for women, good for business, and good for the economy.

 

The Government is firmly committed to reducing the gap between men and women’s earnings and making sure that women’s talents are properly used and rewarded.  That is why we have a number of initiatives in place.

 

Equal Pay Panel Initiative

As part of the DTI Strategic Partnership Initiative we support the Equal Pay Panel of experts, which is led by the TUC.  These experts offer free advice and guidance to organisations looking to investigate or undertake an equal pay review.  This initiative builds on the TUC Equal Pay Project, which has trained over 400 union equal pay representatives. 

 

Serco, a large UK Service company, is just one the organisations who have made progress by seeking out and engaging with this panel of experts. As a result, they have decided to role out equal pay audits across their health and science divisions, with the aim of extending this work across the whole of the business. 

 

This is not Government preaching to others - All eighty eight Government Departments and agencies have now completed pay reviews and submitted action plans. This is reinforced by a tough, but we feel wholly manageable target of 45 per cent of large organisations having undertaken a pay review by April 2008.

 

Success should be rewarded, and we like to reward success.  That’s why we launched the Castle Awards in March 2002.

 

Castle Awards

The Castle Awards recognise the steps taken by employers of all sizes and shapes and in all sectors to address pay inequality and promote equality of opportunity. Winning a Castle Award demonstrates that you are at the front ensuring that employees have equal pay and equal opportunities.

 

Having an award improves staff morale and the firm’s competitiveness. But also your ability to recruit and retain good employees, which we all know is a key ingredient for a successful organisation.  The high regard in which these awards are held is illustrated by the fact that the Castle Awards are now incorporated in the ‘100 Best Companies to Work For’. 

 

The 2005 Castle Award winner for the second year running, W L Gore, also came out as the number one company to work for overall - reflecting the strong link between fairness in pay and how businesses treat their staff. 

 

Legislation

We are making it easier for women to get equal pay through the continued use of the Equal Pay Questionnaire and our amendment in October 2004 to the Equal Pay Act - key to which limits the circumstances in which a tribunal could refuse to consider an equal value claim.  This also introduces new tribunal rules, which prevent cases dragging on - with the intention to help get satisfactory resolutions for women quicker.

 

The National Minimum Wage is playing a significant part in narrowing the gender pay gap, especially as we know women are more likely to work in lower paid and part-time jobs. An astounding 70 per cent of the people who benefited from the October 2005 increase, which raised the National Minimum Wage from £4.85 to £5.05, were women. We know that the gap will further narrow when we expect to increase this further in October 2006.

 

Occupational Segregation

Challenging occupational segregation is crucial in order to boost productivity and close the gender pay gap. 

 

We know that women dominate the lower skilled, lower paid sectors. Whereas men dominate the higher skilled sectors which give higher financial returns. This results in women not using their potential to the full, a major hurdle for economic growth in the UK.

 

In order to tackle this we launched ‘Equal Opportunity and Choice: Tackling Occupational Segregation’ in October last year.  This is a plan highlighting Government action encouraging both men and women into non-traditional areas of work.

 

We provide £6.9 million pounds for the UK Resource Centre for Women (UKRC) in Science, Engineering and Technology (SET).  This centre, based in Bradford, is working with employers and institutes to tackle the barriers that scare off women from working in these sectors.  The Centre provides practical help and support to girls and women, and works hard to raise the profile of women already in these sectors through a range of initiatives. These include a resource website providing a wealth of information and advice, and a new database, to be launched in December, that will encourage more women to become involved in SET decision-making bodies. It also acts as a media spokeswomen and provides role models and speakers to girls and women considering SET careers.

 

The North West Development Agency is working towards developing a Regional Centre for Equality and Diversity to provide advice to employers and employees. The South West England Regional Development Agency has equality representatives, including ‘Fairplay South West’ which aims to represent the interests, views of women and of gender issues.

 

Industry is also taking this issue seriously. Cosmetics firm, L’Oreal and the UK Resource Centre announced in July a programme to address some of the issues faced by female scientists when returning to work after a career break.  Three cash bursaries of £10,000 pounds each, jointly funded by the partners, will be granted to women scientists each year.

 

Blackberry, and women’s networking group Aurora, recently hosted the ‘Women and Technology Awards 2005’ in October. I was very pleased to be invited to present one of the prizes and speak on the importance of the event. Awards such as these, organised by industry, recognise and celebrate women's achievements and raise awareness that women have talents to offer.

 

Skills Strategy

Skills are fundamental to achieving our ambitions, as individuals, for our families and for our communities. They help businesses create wealth, and they help people realise their potential.   They service the twin goals of social justice and economic success. 

That’s why we launched the Skills Strategy which aims to ensure that employers have the right skills to support the success of their businesses, and individuals have the skills they need to be both employable and personally fulfilled.  This will be particularly beneficial to low-skilled women and those working part-time.

 

Conclusion

Eradicating the Gender Pay Gap is a difficult task and we don’t underestimate it. But, we have made progress - but that progress needs to speed up and we need to take all these measures to ensure that it does so.

 

We have to ensure that women have access to the same opportunities as men in the labour market, that they are able to secure higher paid employment and secure a decent pension for when they retire. 

 

Events like this one are so important in raising awareness and understanding of the issues.  


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