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8.43 pm

Mr. John Bercow (Buckingham): It is a great pleasure to follow the hon. Member for Eccles (Mr. Stewart). My only anxiety on his behalf is that I have not the foggiest idea what he will do when he finally loses his charisma.

This is a good opportunity to contribute to the debate on an important Bill, and I should like to advance a number of points. The background to the debate is simple. It is an incontrovertible fact--no Labour Member has been able to deny or gainsay it--that the sea of regulation is now deeper and more hazardous than any with which British companies have previously had to contend.

The lacuna in the position of Labour Members was starkly revealed when several of them were challenged not on the number of regulations on the statute book but on the cost of those regulations. Reading from their prepared texts, they spewed forth various figures relating to what happened in the latter days of the Conservative Government. I have not sought to deny those figures.

If Labour Members were aware of previous debates on the subject, they would know that during a debate on regulations on small businesses on 8 March 2000, the hon.

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Member for Ilford, North (Ms Perham)--a charming contributor to our proceedings and, like me, a parliamentary virgin, if I can put it like that--asked me about the total cost of the regulations that had taken effect in the last three years of the previous Government. I said that, off the top of my head, I did not have the square root of an idea but I would be happy to engage in correspondence with her, if she would find that an enjoyable experience. I am not interested in looking back, and I recognise that the record was not perfect. Nevertheless, the burden of regulation is now greater, more expensive and more difficult to bear for companies the length and breadth of the land.

On that point, I am happy to take my cue not from Conservative Members but from the authentic representatives of industry and commerce themselves. We learn something significant when we read what they have to say, and listen to their public pronouncements. We all know that the Confederation of British Industry, the Institute of Directors, the Federation of Small Businesses, the Forum of Private Business, the British Chambers of Commerce and, indeed, the Institute of Chartered Accountants in England and Wales will typically disagree on a number of matters pertaining to British business. They will have differing views on the merits or demerits of British entry into the European single currency; they will have differing views on the merits or demerits of legislation to counteract the phenomenon of late payment of commercial debt. Of one thing we can be certain, however: they all agree that the burden of regulation is high, that it continues to rise, and that the ratchet needs to be arrested and, wherever possible, reversed.

Mr. White: Will the hon. Gentleman give way?

Mr. Bercow: Not now. Because the hon. Gentleman is my near neighbour, if he behaves himself I will consider giving way to him later when I have developed my argument; but it is important that we do not spare Government Back Benchers the pain of revelation, in public debate, of the enormity of the burdens they have inflicted, through their voice and votes, on companies in this country.

Those burdens fall principally into four categories. First, there are Brussels directives. I am thinking of, for example, the working time directive, the part-time workers directive--which was transposed into British law via the Part-time Workers (Prevention of Less Favourable Treatment) Regulations 2000--and the parental leave directive, which was specifically the consequence of the Government's boneheaded decision to sign up voluntarily to the European social chapter, rightly eschewed by the last Conservative Government.

The second category comprises payroll burdens, about which we have heard very little from Labour Members despite their importance. I refer to, for instance, the working families tax credit, 52 per cent. of whose administrative cost falls on small companies. Let none in this Chamber forget that 99.6 per cent. of British businesses employ fewer than 100 people, that they account for approximately 57 per cent. of the private sector work force, or that they generate two fifths of national output. The fact that those companies are burdened by the working families tax credit is therefore important. Moreover, they are encumbered by--for example--the Education (Student Loans) (Repayment) Regulations 1999, and by the regulations that apply to stakeholder pensions.

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These are significant matters. The point that I seek to make--in my characteristically shy, reticent and understated fashion with which Members on both sides of the House are familiar--is that whatever the merits or demerits of the measures we are discussing in and of themselves, they have one thing in common: they shuffle off responsibility from central Government to beleaguered businesses, forcing the latter to become unpaid tax collectors and benefit distributors. That is wrong, that is pernicious, that is damaging, and it is a phenomenon that can continue unchecked only because--with the insouciance that this Government typically display--no DTI Minister serving in the House of Commons has ever run or worked in a business.

Mr. Pike: Will the hon. Gentleman give way?

Mr. Bercow: Yes, very briefly.

Mr. Pike: Who transferred the burden of statutory sick pay to employers, and away from the old sick pay scheme?

Mr. Bercow: I am intrigued by that question. The hon. Gentleman is falling into precisely the trap against which I should have thought one of my earlier paragraphs would warn him.

The point is--the hon. Gentleman may find it difficult to grasp, but I invite him seriously to treat with it--that I was not in the House of Commons before the last election. I was not a member of the last Conservative Government; I was frequently critical of that Administration. I am simply not interested in playing ping-pong about what happened in the past. The point that I am making to him is that it is possible to do much better. He may believe that the regulatory burden was too great before Labour Members took office, but that is no justification whatsoever for adding to the totality of the burdens with which businesses are encumbered.

I am therefore sorry to say that, although the hon. Member for Burnley (Mr. Pike) may think he has a decent point, it is simply not on my radar screen so far as today's proceedings are concerned. I shall not be in any way deterred or diverted by periodic interventions by Labour Members from continuing to ram home the point about the scale of burdens and the number of different categories into which, under this Government, those burdens fall.

The third example of burdens under this Government is what might be called the alleged domestic "fairness at work" arrangements. Here of course we are talking about statutory trade union recognition--which militates against labour market efficiency, is largely resented by British companies, does not seem to be necessary and cannot contribute to productive potential.

Mr. Ian Stewart: Will the hon. Gentleman give way?

Mr. Bercow: Not at the moment. The hon. Gentleman has just had his speech, and I am going to make mine. However, if he behaves himself, I shall happily consider giving way to him later.

I happen to think that that is an undesirable regulation.

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Mr. Stewart: Will the hon. Gentleman give way on that point?

Mr. Bercow: Generosity always gets the better of me, despite my best endeavours to the contrary. I shall give way.

Mr. Stewart: I thank the hon. Gentleman. It is a bit rich to be arguing about the need for deregulation and fewer regulations. Under the previous, Conservative Government, one of the biggest burdens placed on employers was precisely the type of regulation that he is talking about. It was the outrageous burden of having regularly and persistently to conduct ballots on check-off, which is the deduction of union subscriptions at source. The outrageous nature of the hon. Gentleman's comments shows that the charisma stuff that he is taking is a bit too powerful for him.

Mr. Bercow: I am very grateful to the hon. Gentleman for his intervention, but it was tedious, long-winded and unfocused in equal measure. I have not received a single representation from a business in my constituency--large numbers of which I regularly visit--saying that they strongly approve of the Government's position on statutory trade union recognition and how terribly irksome it was previously to have to conduct regular ballots. I am not entirely clear which planet, or stratosphere, the hon. Gentleman inhabits, but it is not in any way the same as that on which my worthy and industrious constituents of Buckingham live.

I warn the hon. Gentleman, because I am well disposed to him, that the quality threshold will have to be satisfied if he thinks that he will have another intervention. His performance so far is not very auspicious. Of course, however, he will not divert me from the fourth category of regulation by which companies in Britain are encumbered to a greater extent now than ever before--environmental taxes and regulations.

Company after company has justifiably complained about the burden that is threatened by the climate change levy and by the extremely detailed, complex and rigorous integrated pollution prevention controls. Many sectors will be badly hit. Those regulations are extremely zealously drafted. The expectation is that they will, as usual in the United Kingdom, be gold-plated. Those who will lose out are companies. Ministers themselves will not have to pay, as they themselves do not run businesses. They themselves are not familiar with enterprise. They themselves will not suffer. However, those businesses will suffer. It is on their behalf and in their interests that I am proud, with my right. hon. and hon. Friends, to speak in this debate.

The effect of all that regulation can be measured in various ways. However, I thought that the Institute of Chartered Accountants in England and Wales made a very interesting assessment. In its study, it concluded that, under this Government, companies with between 51 and 200 employees face annually an extra regulatory burden of about £10,500. For companies with between 11 and 50 employees, the amount is £4,700, and for the smallest micro-businesses it is £1,700.

The significant fact, which is another serious challenge to Labour Members, is that the most recent survey that that organisation undertook revealed that the burden for

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the average company was about £3,600 a year--a burden that had more than doubled since the previous year. Not only is the burden high, but it continues to rise. The Government do not even acknowledge that fact, let alone propose to do anything about it.

We know, not only from those small business organisations but from others, how corrosive the impact of that regulation is. Accountancy firms, business analysts and policy institutes consistently speak with one voice: they say that the Government are getting it wrong, and that it is time they had the decency to acknowledge the fact and propose remedial action without delay.

The Deregulation and Contracting Out Act 1994 was passed by the previous Government. I will not dilate on that subject at length, because many hon. Members have, rightly, already touched upon it. Suffice it to say that it was generally agreed, not least during the debate in another place, that the Act had achieved something worth while.

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