Seòmar agus comataidhean

There is certainly a careful balance to be struck. Employment law is reserved—I will come to that issue specifically later on—but this is a question of how public money is to be spent and the conditions that we attach to it.

The Scottish Government does not have the power to set the real living wage in Scotland, but it has very successfully set a condition that any business in receipt of a Government grant or contract must pay at least the real living wage. That is an example of how, although we are not able to set wage levels across the board, we are able to attach conditions that fall within the scope of devolved powers when it comes to how public money that is provided by the Scottish Government—in this case, through the SFC—is spent. That example is a case study from the past four years of what we have done in relation to the real living wage.

Through some of my amendments in this group, I am specifically trying to improve industrial relations. I think that we would all agree that colleges’ ability to play the critical role that they could play in our economy is being held back by a decade of industrial action and the chronic problem of poor industrial relations. In a lot of cases, the working conditions in universities are even worse. For example, graduate teaching assistants often tell us about the struggle of being on zero-hours contracts, or of having huge workload pressures that require so much unpaid overtime that, in some institutions, they are in effect working for less than the hourly minimum wage.

Colleges and universities receive billions of pounds of public money, and that gives us a responsibility to act. We can use the funding that we provide to drive up conditions in both those sectors.

I will go on to the specifics of the rest of my amendments. Amendment 61A would introduce a 10:1 pay ratio as a condition of funding, so that anyone who is employed by a fundable body must be paid at a rate that is no less than one tenth of the salary of the highest-paid employee, on a full-time-equivalent basis.

That argument always interests me. In ballpark terms, if we think about the salary of the lowest-paid employees and multiply that by 10, I find it hard to envisage that we would be unable to attract people of a sufficient calibre if we offered them salaries in the region of a quarter of a million pounds—somewhere between £200,000 and £250,000—which is roughly 10 times the salary of the lowest-paid employees, on an FTE basis.

What I am getting at is shown in the example of one principal who was before the committee recently and whose salary is in excess of £420,000. Indeed, his remuneration package is so big that he could not tell the committee accurately how much he is paid. I do not accept that we would not be able to attract people of sufficient quality if the institutions offered salaries in the region of £250,000.

Linking principals’ salaries to those of paid employees does not make it impossible to increase a principal’s salary further, but it means that those who are at the very bottom would also need to see their salaries increase. Amendment 61A does not therefore seek to cap salaries as an absolute; it would cap them relative to the salaries of the lowest-paid staff and provide an incentive to push their wages up.

I will come on to the specific detail of that in a moment, but I have drawn that distinction in respect of my proposal about senior management pay in colleges being folded into the public sector chief executive pay framework. I am not proposing that for universities for precisely the reason that Mr Rennie has outlined. We already set conditions on the funding that we provide to those institutions, so it is a question of how far we can go before compromising ONS classification.

I have drawn the line at the 10:1 pay ratio, which I think is appropriate in the case of universities. It would not be appropriate to draw them into the chief executive pay framework because that is for public sector chief executives. Universities are largely publicly funded, but they are not public bodies in the same way that colleges are, which is why I proposed that college principals should be brought into the chief executive pay framework. That is where I draw that particular line, although I recognise that it is up for debate.

I recognise the time that I am taking, convener. I will try to rattle through the rest of the amendments.

Amendment 61B would set a condition of eliminating the use of zero-hours contracts. The Government's fair work criteria refers to ending the inappropriate use of zero-hours contracts, but I cannot see any evidence of action being taken to achieve that, despite it being a Government policy objective. I am also not sure what appropriate zero-hours contracts would look like, as opposed to inappropriate zero-hours contracts, and I have not heard the Government elaborate on that. Again, if the minister can articulate what the Government is doing to reduce the use of inappropriate zero-hours contracts, I would be open to hearing that. However, I have pressed the Government and the SFC on that in the past and no one has ever provided me with any evidence of action having been taken.

Amendment 61C would provide for the payment of at least the real living wage for all employees of funded institutions. There is a pretty simple argument behind that: everybody deserves a wage that they can live off and one that is enough to pay their bills. Public bodies such as colleges and institutions that are in receipt of a huge amount of public funding, such as universities, should lead by example when it comes to a liveable wage for their staff.

The national minimum wage is not a liveable wage. As it stands, the real living wage is a little bit higher than the national minimum wage, but it is not defined in law. It is a concept that we are all familiar with, but it is not fully defined in law. I am therefore trying to come up with some legal language that gets to the point of saying that it should be sufficient for people to live above the poverty line. That is the real living wage, but if I was to put “real living wage” into the amendment, it would not mean anything. We are familiar with the concept, but it has no statutory underpinning.

I am sympathetic to the argument that Willie Rennie is making on having an independent body. Does he think that it would be necessary to have that body as well as the apprenticeship committee that the bill would set up? I am worried about having both those bodies in existence at the same time. I wonder whether there is another way to do it that would make the committee that the bill would establish more independent from the SFC and the Government, rather than setting up a body that, in many ways, would potentially duplicate the work of the body that is already set out in the bill.

Although amendment 91 sits in this group, it is very much connected to the debates that we have now quite thoroughly rehearsed in relation to reserved areas versus areas where we can stretch devolution, conditionality and so on. I will briefly summarise amendment 91, but, unlike previously, I will not go into it in depth, because we have rehearsed a lot of the underlying arguments.

Amendment 91 provides that

“Ministers must by regulations specify the minimum rate of pay”

for a Scottish apprentice. Such regulations would be subject to the negative procedure. Amendment 91A builds on that by specifying that the rate of pay must not be less than the national minimum wage.

I lodged the amendments because although I think that we all recognise the value of apprenticeships as a fantastic way to kick-start careers, apprentices are vastly underpaid a lot of the time, meaning that many people cannot afford to go down the apprenticeship path, even if they want to. The purpose of amendment 91A is to align the minimum wage payable to apprentices through the funding provided by the Scottish Government and the SFC with the wider national minimum wage.

At the end of June, there were just under 12,000 modern apprentices in Scotland in their first year of training, and about 6,000 of them were 19 or over. If amendments 91, 91A and 93 were to be agreed to, those apprentices, and every subsequent first-year apprentice, would be entitled to receive the minimum wage for their relevant age groups. For the 6,000 first-year apprentices this year, that would be a pay uplift of just under 50 per cent. Bringing apprenticeship wages in line with the existing national minimum wage would end what I think many of us see as the injustice that means that apprentices are paid less than the minimum wage of other workers of the same age, despite the fact that apprentices’ bills and other expenses are not less than anyone else’s.

Amendment 93 is consequential. It would remove Scottish apprentices from the National Minimum Wage Regulations 2015. Even under devolution, we are able to make variances, as is evident in the fact that Scottish apprentices are currently included in the 2015 regulations. Amendment 93 would specify that the relevant regulation

“does not apply to Scottish apprenticeships as defined by section 12E of the Further and Higher Education (Scotland) Act 2005”,

which section 4 of the bill inserts.

I have already rehearsed why I think that it is possible to get into the area of conditionality in relation to wages. We have already had that argument with the Government. I understand the Government’s position, but I am disappointed by its lack of willingness to test the limits of legislative competence or to use non-legislative policy-setting powers in order to raise standards in the sector.

At this stage, I will not move my amendments, but I am keen to engage with the minister ahead of stage 3, especially on the issues that we have discussed with Pam Duncan-Glancy and the need for the Government to provide a clear statement before stage 3 on its wider approach to fair work in the sector and what other levers it intends to use to turn its policy aspirations into reality. The lack of action on the part of the Government in relation to the use of non-legislative mechanisms is why so many of the amendments in this group have been lodged.

I very much agree with amendment 66 in principle. It is very similar to amendments that Pam Duncan-Glancy and I have lodged to previous bills. However, I wonder about its operability and whether it is flexible enough.

I am thinking of a scenario that a number of institutions have faced recently, when they had to close entire buildings on a moment’s notice due to the presence of reinforced autoclaved aerated concrete. Obviously, that had a significant impact on the ability to provide for learners, but it would not have been appropriate to require them to inform trade unions, student bodies and so on beforehand, because they had to act the moment that they became aware of the issue. Does the member think that her amendment is flexible enough to take into account such situations?

That is the point that I struggle with. I hope that the minister can correct me, but I do not see any difference between what is in his amendment 12 and the power that SDS already has and simply has not been using. It is within SDS’s powers now to effectively cap the amount that managing agents take, and it has just not done that. We are moving responsibility from one body to another, but I am not clear how Parliament can have confidence that that will result in effective caps being set and good use of public money.

If the minister is amenable to working with me further on the issue, I will not move amendment 51, but I have not yet heard a case for why Parliament should be confident that his amendment 12 will result in a change of practice. We are shifting the power from one organisation to another, but there is no substantive change in what is expected of the body. Amendment 12 is very vague, as it talks about what would be a “reasonable” charge and so on.

As I said, I am happy not to move amendment 51, if the minister is happy to work with me ahead of stage 3 to consider whether ultimate responsibility for setting a cap could sit with ministers.

I take his point that, if his amendment 12 is agreed to, the SFC would be bound by law to do something that SDS is not currently bound by law to do. However, my question is about what it will be bound by law to do. The wording of the minister’s amendment is vague, and I am not convinced that it would result in substantive change in practice.

Will the minister take another intervention?