Liberal Democrat MPs are increasingly well-practised at eating their words. The latest reversal is over equal pay audits.
The Home Secretary, Theresa May, will announce later today that plans to force companies to disclose how much they pay men and women are to be scrapped. Instead, companies will be asked to narrow the pay gap – one of the worst in Europe – through voluntary efforts.
It comes as no surprise that a Conservative-led government has opted to scrap this clause in the Equality Act – it is unpopular with big business. But it does fly in the face of a Liberal Democrat manifesto pledge to introduce fair pay audits for every company with more than 100 employees. This went further than Labour’s draft legislation, which limited the measure to companies with more than 250 employees.
It will also be a humiliating climbdown for the Lib Dem Lynne Featherstone, junior minister for equality, who said in June 2008 that the legislation did not go far enough:
A voluntary audit system for private industry is hardly worth the paper it’s printed on. We need to know when the government actually plans to step in if progress isn’t made.
The government’s failure to grasp the nettle of private-sector pay will provide little comfort to the enormous numbers of people who are still being discriminated against in the workplace.
Featherstone has not issued a statement in the response to the new move.
Not only is this an about-turn for the Lib Dems, it is a huge step backwards in the fight to equalise pay. Women in the UK earn, on average, 21.4 per cent less than men. A recent study estimated that, at the current rate of change, pay would not be equalised until 2067. It is clear that we need to take positive action to speed this process along.
Gender equality groups such as the Fawcett Society have consistently pointed to the UK’s culture of secrecy around pay as one of the reasons that the gap persists. In Sweden, when transparency measures were introduced, the gender pay gap has narrowed greatly.
Speaking to the Financial Times this year, Harriet Harman explained the thinking behind the compulsory audit:
It is all too easy for people to say there is unfairness in pay but not here, and it is very important – knowledge is power – for people to see the pay gap in their workplace.
Though the voluntary measures that will replace gender pay audits have not yet been spelled out, it is probably safe to assume that the bite has been taken out of the act altogether.
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