HM Treasury News Release
20/98 12 February 1998
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DAWN PRIMAROLO, FINANCIAL SECRETARY TO THE TREASURY, SPEAKS TO
THE WOMEN'S BUDGET GROUP
Attached is the text of a speech given by Dawn Primarolo,
Financial Secretary to the Treasury, to the Women's Budget
Group today.
DAWN PRIMAROLO, FINANCIAL SECRETARY TO THE TREASURY, SPEAKS TO
THE WOMEN'S BUDGET GROUP
1. I am very pleased to have this chance to address you
here today. Both in Opposition and in Government, my
colleagues and I have had respect for the work done by members
of the Women's Budget Group.
A: THIS GOVERNMENT - TREASURY INCLUDED - IS PRO WOMEN
2. The Government - and the Treasury in particular - is
committed to supporting women in their diverse roles:
we want equality of opportunity for men and for women.
The Government must enable women to take their rightful
place as the economic equals of men. There is still much
progress to be made: 79 years after women got the vote,
there are still far too many women in low income groups,
low paid jobs and living in poverty in workless
households.
and we must support women in their role usually as the
main carer for children. Fundamental to this
Government's mission, is to serve the children who are
our future. We are committed to tackling child poverty.
B: WE ACCEPT THE NEED FOR GENDER AWARENESS IN POLICY MAKING
3. I am proud to be part of a Government which understands
that Governments should be aware of - and take fully into
account in the decision making-process - the differential
effects of economic policy on men and women. Not as an
afterthought, but as an integral part of policy making.
4. The reality is that - overall - women's lives differ from
men's in ways which are structural to our economy. So some
Budget measures affect women differently than men. That is
why an analysis of gender impact lies right at the heart of
this Government's Budget process. We will publish information
on Budget Day setting out the gender impact of those policies
which particularly affect women.
5. It is vital that our decisions - especially our Budget
decisions - are taken on a gender aware basis. Too often in
the past, many of us have felt that policy decisions have
been taken in a way that is "gender blind." A poor policy
process runs the risk of delivering poor decisions: decisions
reflected in today's status quo: a status quo which is failing
women.
C: THE STATUS QUO IS FAILING WOMEN
6. Previous Governments have failed to respond to the
changing political and economic context, and the changes in
women's and men's roles. They have led to a status quo that is
failing women today. The figures speak for themselves. Of the
lowest 10 per cent of earners in the UK, nearly two-thirds are
women. Average weekly earnings for women are only three
quarters of the level for men. Three quarters of clerical
and secretarial posts are filled by women whereas they only
occupy a third of managerial and administrator posts. Women
in managerial posts earn on average just two thirds of the
salary of their male counterparts. More women than men are
on temporary contracts.
Previous Governments have failed to respond to womens'
changing place in the labour market. The state -
through the benefit and tax systems - has continued to
assume that men work in secure long term jobs whilst
women stay at home and care for the children. The reality
is now much more diverse. More and more women are in
employment - in the last 15 years, we have seen an
increase of over 2 million working women. Many more women
than men choose to take up the opportunities of part-time
work.
Specifically, the benefit system failed women by assuming
a family structure in which women are dependent on men;
where there is a male breadwinner, with women staying at
home to look after children. Just one example: the
benefits system fails to give partners of the unemployed
the help and advice they need to find work, because of
the overriding focus on getting the breadwinner back to
work.
. The state has failed to adapt itself to changing social
trends, for example the needs of lone parents: parents
who want to do the best by their children. Lone parents
have been denied the advice and help they need: instead,
these parents were turned away with an order book, and
told not to return until their youngest child had reached
their 16th birthday.
The state has failed to adapt to changing needs on
childcare. There has never been a national strategy to
ensure that childcare in Britain matches women's changing
role in the labour market. The issue of affordability has
been ignored for too long. And the childcare disregard has
benefited only 31,000 families - less than 5 per cent of
Family Credit recipients.
The state has long failed to recognise the importance of
unpaid work and the informal sector. Unpaid work plays a
vital role in stitching together the fabric of society.
D: WE WILL WORK TO ENSURE THAT WOMEN ARE FAILED NO LONGER
7. This Government is not prepared to sit by and watch
women being failed in all of these different ways. That is why
we are embarked on a wide ranging programme of reform to ensure
that women get a new deal from the state. This new deal must
ensure that we help women from welfare into work, that we ensure
that work pays and that we support women in all of their diverse
roles.
8. We have started to implement the new deal for Lone
Parents, giving women the advice and support they need in finding
work, to improve their own and their children's lifelong
prospects. This is the first national attempt to help lone
parents - 90% of whom are mothers - into work. The vast majority
of lone parents - just like women in couples - want the
opportunity to work. Not just for the financial rewards but for
the self-respect and independence work brings. The employment
rate for mothers in couples has risen from 53 per cent to 65 per
cent, over the past 20 years. At the same time, the number of
lone parents in work has fallen from 48 per cent to 40 per cent.
We are determined to give lone parents - and their children - a
chance.
9. We will be spending œ175 million on the New Deal for lone
parents over this Parliament. The programme will be available
nationally for all new claimants from April, and will involve
personal assistance with jobsearch, training and childcare for
people who have previously been ignored by the system.
10. We are modernising the tax and benefits system. The
key to tackling poverty among women and children is work. Work
provides a better standard of living than could ever be received
on benefit. Our reforms aim to remove the financial penalties
that the tax and benefits system present to those deciding to
work.
11. The Government is committed to introducing a 10p tax
rate when it is prudent to do so. This will help improve take
pay for the low paid - many of them women as we know - and
improve work incentives.
12. By setting a floor under wages, the National
Minimum Wage will be of particular benefit to women in low-paid
work. It will help to remove the worst cases of discrimination,
and help promote work incentives. And women stand to benefit
from the introduction of the part-time workers' directive, which
aims to bring the rights of part-time workers more into line with
those of full-time workers.
13. We are developing a national strategy for childcare.
We have already started delivering, with a œ300m out-of-school
initiative. Our national strategy will empower local communities
to work together to meet their childcare needs. And we recognise
the importance of, and are committed to promoting, family-friendly policies at work - for women and men and their families.
14. Taken together, we have a host of policies which are
designed to address the failure of past policy vacuum. We are
determined to deliver on these promises, and we have already
started to do so. Doing nothing is not an option if we want to
improve lives of women where the system is failing.
E: OUR POLICIES WILL SUPPORT WOMEN CARING FOR THEIR CHILDREN
15. We recognise of course that many women choose to stay
at home and look after their children. The value to society of
this unpaid caring work should not be underestimated. Indeed I
am pleased to note that the Office of National Statistics is now
starting to collect and make sense of data on the unpaid sector
of our economy.
16. Our policies will be designed with the importance of this
unpaid caring sector in mind. For example, we are committed to
introducing citizenship pensions for those who assume caring
responsibilities and lose out on pension entitlements. This is
part of our agenda to ensure a decent income for women over
their whole lifetime.
17. The primary caring role that women have traditionally
held within the family, of course, means that it is often women
that are closer to the needs of children. We are determined to
bring forward policies which will enable women to look after the
needs of their children.
18. I want to reassure you today that child welfare is at
the heart of our policies. We know that investing in children -
in this country's future - is the most important investment we
can make. The first few years of life are the most important in
determining ability to thrive at school, in work, and in society
more widely. Disadvantage in childhood can lead to life-long
problems which affect the rest of the community - through crime,
drug abuse and unemployment. The best way of supporting children
is enabling parents to give their children the best start in
life.
19. We recognise the importance of child benefit as a
mechanism for ensuring the extra cost of children is recognised.
That's why we had manifesto commitment to retain it as universal
benefit for the under 16s. Child benefit has been frozen on a
number of occasions in recent decades. This Government is
committed to uprate it at least in line with prices.
F: AND - CRUCIALLY - OUR POLICIES WILL BE DESIGNED TO SUPPORT
FAMILIES IN WORK
20. Welfare to Work and the Working Families Tax Credit are
key policies which underpin our agenda for creating fairness,
justice and equal opportunities for all. Our policies must
facilitate the move from welfare to work, and must also ensure
that work pays. A WFTC would be key to this strategy.
21. Family credit has contained successful elements. But we
should have no illusions about its failings. It is taken up by
only 70 per cent of potential recipients. And the childcare
disregard has benefited only 31,000 families, only one-fifth of
the number originally anticipated. Family Credit has contributed
to penal marginal withdrawal rates. 650,000 families face
marginal rates of 70 per cent or more, with women usually the
greatest losers. It is also administratively cumbersome: almost
half a million families on Family Credit receive a benefit cheque
from the DSS while paying income tax to the Inland Revenue.
22. A new tax credit would have a number of advantages over
the existing system of Family Credit:
its clear link with employment would demonstrate the
rewards of work over welfare and help people move off
benefits into work.
the payment of a tax credit will guarantee working
families a minimum income, above and beyond the level
of the minimum wage
the onus would be on government to help ensure that as
many individuals as were entitled would receive the
tax credit, which - together with its status as a tax
credit rather than a welfare benefit - should improve
take-up
and, as the Chancellor made clear in his Pre-Budget
Statement, the new system would also involve improved
support for childcare through reform of the childcare
disregard which has failed to cover adequately the
childcare costs of lone parents and others on low
incomes.
23. Much of the attention surrounding today's Conference has
been focussed on what a Working Families Tax Credit would mean
for women. The Working Families Tax Credit would be paid to
families with children. One in five children live in families
without work. Families without work are families without
independence. We are determined to help families with children
give their children the best start in life. The Working Families
Tax Credit will help people's incomes rise as the new system
improves incentives to work.
24. It is women who have been the greatest losers from the
lack of coordination between tax and benefits systems to date.
It is women who have most often been prevented from working by
the barriers the state has created which fail to give people
incentives to work and to move up the job ladder. A reformed
system is what women and their families deserve.
25. The final issue that I want to talk about is the
purse to wallet issue. I believe that we need to be quite clear
about the evidence on income sharing patterns within households.
Ruth Lister's research is a helpful start, but her findings are
clearly open to a variety of interpretations. Her work shows is
that there is an extremely diverse pattern of income
distribution within households. There is no one dominant model.
26. There is no threat to independent taxation from the
working families tax credit. Nor would there be a compulsory
transfer of resources from women to men. If the working families
tax credit replaced Family Credit, families would have the right
to elect to whom the tax credit is paid - the woman or the man.
27. Women, because they are greatly over represented in the
poorest groups, will be the main beneficiaries of a WFTC. This
is especially true once the dynamic effects are taken into
account. It is essential not to base thinking about welfare on
the false premise that we are merely sharing out the state's
resources. That can only ever be a short term view.
G: CONCLUDING REMARKS
28. This government is embarked on a vast programme of
change. We have put an end to men only economic policy. We will
always consider the impact of our policies on women. We will
continue to support women in all of their diverse roles - as
breadwinners and as carers in the home.
29. My message to you today is that this programme of change is
not a threat to women, rather it is essential for delivering a
fair deal for women. We mustn't look back. Only by moving
forward can we deliver this agenda together.