Bottom-up business development key to solving in-work poverty

(Title Image: Rife Magazine)

It was Mike Hedges AM’s (Lab, Swansea East) turn for a short debate this week and he chose the topic of poverty – causes and solutions.

Exploitative contracts

Mike Hedges said a successful Welsh economy had to drive up wages, but the task was made more difficult by “exploitative” zero-hours and daily guaranteed hour contracts, which mean employees can’t plan their day and have no idea precisely how much they’ll be earning in any given shift.

Also, the increasing use of recruitment agency staff has eroded certain rights. Agency staff have no right to occupational sick pay, redundancy pay or a right to claim for unfair dismissal or receive a minimum notice period for redundancy.

As well as increase wages – through the widespread introduction of things like the living wage – we also need to do more to attract and retain high-paid jobs.

“What do we need to do in Wales? I believe that we need to work more closely with the universities: Aarhus, for example, and the business park model and Manheim has a centre for innovation and entrepreneurship….It’s easy to say, ‘Oh, Cambridge is very successful; it’s got a science park.’ Swansea, Cardiff and Cambridge? No. But could we be the same as Manheim and Aarhus? There’s no reason why we couldn’t. Manheim is the second city within its Länder and Aarhus is the second city in Denmark – not dissimilar to Swansea.”
– Mike Hedges AM

Dawn Bowden AM (Lab, Merthyr Tydfil & Rhymney) repeated calls for the Welsh Government to prioritise anti-poverty measures to prevent a downward spiral in light of insecure work and welfare reform.

Nine years of austerity

Economy & Transport Minister, Ken Skates (Lab, Clwyd South) was under no illusions that the key driver of in-work poverty was the decade of austerity measures introduced by the Conservatives and Lib Dems at UK level. The Welsh budget would be £4billion had it grown in line with economic growth.

While he admitted there was very little within the Welsh Government’s control or devolution to properly address poverty, such as measures to increase household incomes by improving skills; the proportion of working-age people with no qualifications has halved in Wales since 1999.

He didn’t accept the assertion there were few high-skilled jobs in Wales though:

“….we only need to look at some of those sectors that provide the highest levels of productivity and wages – financial and professional services, for example, with growth here in Cardiff and across Wales at an astonishing level compared to the rest of the UK. Aerospace is the most productive sector in the British economy, and here in Wales we have a disproportionately high number of people now in employment in that sector—more than 20,000 people in incredibly valued jobs.”
– Economy & Transport Minister, Ken Skates

The Welsh Government’s new economic contract will seek to drive fairer and more responsible business and employment practices to address the rise in insecure work.