Harriett Baldwin answers MPs’ questions on issues including the effect of the national living wage on wage growth and creating more women business owners.

National Living Wage

4. Glyn Davies (Montgomeryshire) (Con): What assessment he has made of the potential effect of the national living wage on wage growth. [902446] The Economic Secretary to the Treasury (Harriett Baldwin): The national living wage will mean that a full-time minimum wage worker will earn more than £4,700 more by 2020—a 40% pay rise. Additionally, owing to the ripple effect of higher wages, up to a quarter of workers will see some benefit. Economy-wide wages are expected to be, on average, 0.4% higher in 2020. Glyn Davies: There has been a widespread welcome for the Chancellor’s national minimum wage announcement. Inevitably, the minimum wage has a major effect on traditionally low-wage sectors, especially social and residential care. Does my hon. Friend accept that the Government and local councils must be mindful of the fact that fees will need to be adjusted to ensure the viability of these hugely important services? Harriett Baldwin: My hon. Friend is right that many of the 900,000 workers in the social care sector will benefit from the new national living wage, including many working in residential care. That is why last week in the autumn statement we made an announcement that councils will have the power over the course of this Parliament to access money that they may need to increase the amount that they pay for social and residential care, with new revenue streams for social care worth up to £3.5 billion by 2020. Peter Kyle (Hove) (Lab): As the Minister will be aware, the national living wage does not apply to people who are self-employed, whose wages have been stagnating and whose pension contributions have fallen every year for the past five years. Why were self-employed people not mentioned once in the productivity plan, and what does she intend to do to tackle low pay and conditions among the self-employed? Harriett Baldwin: The hon. Gentleman speaks powerfully of the importance of the self-employed to our economy. We pay tribute to the excellent work that so many self-employed people, including many in my family, do to generate economic growth in this country. He is right that, as wages across the economy grow and as we put more spending power into budgets for social and residential care, we expect that to be passed on to those who are self-employed. | Hansard  

Household Debt

14. Mrs Emma Lewell-Buck (South Shields) (Lab): What recent estimate he has made of the level of household debt. [902457] The Economic Secretary to the Treasury (Harriett Baldwin): Since the financial crisis, households’ financial positions have improved. Household debt as a proportion of income has fallen to 144% in the second quarter of 2015, down from a peak of 168% in the first quarter of 2008. Mrs Lewell-Buck: I thank the Minister for her response, but a large number of my constituents have been alarmed that mistaken overpayments of working tax credits made by Her Majesty’s Revenue and Customs have been recovered, without warning, from their child tax credit entitlements. Is the Department’s policy now to push people into poverty and debt by punishing them for HMRC’s mistakes? Harriett Baldwin: The hon. Lady might remember the terrible roll-out of working tax credits that occurred when the Labour Government were in power. I can assure her that we will continue to improve the administration of tax credits. When her party was in power, people could have a £25,000 change in their income without it affecting their tax credits. We have brought the figure down to £2,500. Several hon. Members rose— Mr Speaker: The hon. Member for Havant (Mr Mak) looks animated and contented. Let’s hear from the fellow. Mr Alan Mak (Havant) (Con): Thank you, Mr Speaker. Household debt will be kept low, thanks to the Government’s support for savers, including the Help to Buy ISA that was launched today. Will the Minister join me in encouraging first-time buyers and young savers to take advantage of this new Government support, which is part of the Government’s long-term economic plan? Harriett Baldwin: I am delighted that, on behalf of his constituents in Havant, my hon. Friend has noticed that the Help to Buy ISA scheme launches today. Fourteen financial institutions are already offering this exciting new opportunity to save for a home, and I hope that many of his constituents will take advantage of it. 22. [902465] Margaret Greenwood (Wirral West) (Lab): Citizens Advice has noted that household bills are now the chief source of the problem debt that people are seeking its help with. What will the Government do to ensure that guarantor and logbook loans are properly regulated, so that they do not simply replace payday loans as a source of poorly regulated credit that exploits the low-paid and the vulnerable? Harriett Baldwin: I am sure the hon. Lady will welcome the fact that, in the last Parliament, we took steps to bring credit under the regulation of the Financial Conduct Authority. As a result of that, payday lending has dropped sharply. We are also backing credit unions in many different ways in this country, and we want to ensure that people have an opportunity to save through their workplace credit union. If she will work with me, I can assure her that we will continue to ensure that households that have the lowest proportion of debt at the moment in their repayments will continue to see their financial positions— | Hansard  

Topical Questions

Craig Tracey (North Warwickshire) (Con): As chair of the all-party parliamentary group on women and enterprise, I welcome the fact that more women than ever are working in Britain today. One of the barriers to forming a cohesive forward strategy for creating more female business owners is a lack of reliable data on how many there currently are. Will my hon. Friend meet me to discuss that issue and consider possible solutions such as the collection of data on HMRC returns? The Economic Secretary to the Treasury (Harriett Baldwin): I congratulate my hon. Friend on his appointment to the APPG, and I look forward to working closely with him to provide the data that he seeks. | Hansard