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IEA comments on BEIS committee report on the gender pay gap

Commenting on the Business, Energy and Industrial Strategy committee’s recommendation to increase the number of businesses that need to declare their pay gap reporting measures, Kate Andrews, News Editor at the Institute of Economic Affairs said:

“This recommendation will only result in further public intrusion into private life. It will not help women.

“The pay gap reporting measures result in worthless statistics, misleading headlines and unfair demonisation of companies. Rather than making comparisons with like-for-like roles, they instead measure pay across organisations altogether, irrespective of different roles, age, or hours worked.

“Extending these requirements will result in more bogus statistics, which provide no meaningful insight into the reasons for pay differentials. They are worse-than-useless, in the sense that they create perverse incentives for companies to hire fewer female graduates, to avoid skewing pay quartile statistics.”

“This proposal will also create extra cost for small companies who do not have the resources or the capacity to deal with yet another bureaucratic burden.

“The gender pay gap is the lowest it has ever been on record, at roughly 9.1% for full time work, and -5.1% for part time work, according to the ONS. This is essentially a select committee exercise in virtue-signaling, rather than a meaningful effort to help women in work.

View report: Closing the gender pay gap - businesses must drive change 

Notes to editors:

For media enquiries please contact Nerissa Chesterfield, Communications Officer: nchesterfield@iea.org.uk or 07791 390 268

For the IEA’s briefings on the Gender Pay Gap, please click here and here.

The mission of the Institute of Economic Affairs is to improve understanding of the fundamental institutions of a free society by analysing and expounding the role of markets in solving economic and social problems and seeks to provide analysis in order to improve the public understanding of economics.

The IEA is a registered educational charity and independent of all political parties.