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Session 2001- 02
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Delegated Legislation Committee Debates

Draft Maternity and Parental Leave (Amendment) Regulations 2001

Second Standing Committee on Delegated Legislation

Wednesday 7 November 2001

[Mr. Win Griffiths in the Chair]

Draft Maternity and Parental Leave (Amendment) Regulations 2001

4.30 pm

The Minister for Employment and the Regions (Alan Johnson): I beg to move,

    That the Committee has considered the draft Maternity and Parental Leave (Amendment) Regulations 2001.

It is a pleasure to serve under your chairmanship, Mr. Griffiths. I welcome the hon. Member for Runnymede and Weybridge (Mr. Hammond) to his new Front-Bench role. I am sure that he will add to the gaiety of the nation in the coming months.

I shall set out some general background to our consideration of family-friendly policies such as parental leave. The Green Paper, ``Work and Parents'', which we published at the end of last year, set out our commitment to helping working parents balance the needs of their work with the care of their children. It put forward a range of options to improve choice for parents and to enhance competitiveness and productivity for business. As part of the ministerial group set up to inform the scope of the Green Paper, I had face-to-face meetings to discuss proposals for change. Members of the ministerial group and officials from the review team met almost 300 individuals. We received a further 600 formal responses during the consultation process. From that, we learned that working parents and employers want more support—support for parents, in fulfilling their potential as parents and employees, and support for business, particularly small business, in taking on board changes in legislation.

In March we announced a series of new measures on maternity, paternity and adoption leave to offer more support to working parents around the time of a child's birth. Those measures had all received strong support during the Green Paper consultation, and they will be taken forward through the Employment Bill, which we have introduced today. At the core of our decision-making are two principle elements: ensuring more choice for parents and appropriately light-touch regulation for business.

We announced in April changes to the regulations that govern parental leave. At the moment, only parents of children born on or after 15 December 1999, when the right was first introduced, qualify for it. Parents of disabled children are entitled to the same amount of leave—13 weeks—as other parents. Parental leave was a totally new concept in the United Kingdom when we introduced it at the end of 1999. We had no experience of how it would work, and although we had of course consulted business on its possible effects, we could not be sure what, if any, difficulties it might create for businesses. We therefore felt we should adopt a light touch in introducing the right, so as to give employers time to understand the new provisions and their implications. That has worked well, and we believe that the time is now right to increase the amount of leave to parents of disabled children, and to extend parental leave to all parents with children under five.

In May we issued a ``Work and Parents'' consultation paper on changes to parental leave, which reflected comments that we had received during the Green Paper consultation, and the business experience that we were able to draw on, as the right had been in existence for more than a year. Consultation closed in August. We received 46 formal responses, split almost equally between parents, employers and their representative bodies. All the responses supported the changes, and we are therefore proceeding with them.

The changes to the regulations will enable parents of disabled children to take 18 weeks' leave up to their child's 18th birthday. That is an increase of five weeks. Different provisions already exist for parents of disabled children, enabling them to use their leave over a longer period, until the child's 18th birthday. By increasing to 18 weeks the time that parents can take off, we shall make it possible for them to take a week's parental leave a year, if they want to, up to that time. That will give parents of children with disabilities greater flexibility to strike the balance between working and caring for their child's additional needs. That move has been strongly supported by business, parents and disability groups.

In addition, we believe that the time is now right to increase the number of parents who are able to exercise the right to parental leave. The changes to the regulations will ensure that the parents of all children who were under five when the right to parental leave was first introduced will now benefit from it. One effect of the extension that we are proposing is that transitional arrangements will be needed to cover parents of children who have since reached or will soon reach the age of five. Our aim is to ensure that those parents are not disadvantaged, while preserving as far possible the existing requirements of the regulations.

Under the statutory fallback scheme, which forms part of the original regulations, parents are limited to a maximum of four weeks' parental leave in any one year. On that basis it will take slightly more than three years for those parents to take their full entitlement of 13 weeks' leave. The same applies to parents of children who were placed with them for adoption in the five years before the right was first introduced. The amended regulations will therefore give all such parents and adoptive parents until 31 March 2005 to exercise their rights. The parents of disabled children will have until their child's 18th birthday to take their 18 weeks' entitlement, as provided in the current legislation.

Subject to approval in this place and in the House of Lords, we intend that the amended regulations should come into force on 10 January 2002. I have no hesitation in recommending the regulations to the Committee.

4.36 pm

Mr. Philip Hammond (Runnymede and Weybridge): As I understand it, there are three key elements to the amended regulations. First, the start date—the cut-off point at the beginning—will change so that those parents whose children were already five years old when the regulations were introduced in December 1999 will be included in the scope of the regulations. Secondly, a period of service with a previous employer will count for eligibility under the regulations. Thirdly, the amount of the time available to parents of children who have a disability will be extended.

Although all aspects of the regulations will impose additional burdens on business, there is universal agreement among those to whom I have spoken that the additional burden caused by the extension of parental leave for parents of children with disabilities will be more than off-set by the benefit that will accrue to the parents and children involved. I am sure that no dissenting voices will be raised in the Committee about that aspect of the regulations.

On the change to the start date, the Minister has told us that the Government believe that the time is now right to include in the scheme parents whose children were under five on 15 December 1999. That, if I may say so, is being just a trifle economical with the history of this policy. Although the Minister's explanation is interesting, it is not as interesting as the true story, which I shall now attempt to tell the Committee. The regulations were brought before the House in December 1999 by the Minister who is with us today, so he will remember the events well. He told the Committee:

    ``All our legal advice tells us that our provision is in accord with the directive.''—[Official Report, Fifth Standing Committee on Delegated Legislation , 1 December 1999; c. 15.]

The Trades Union Congress did not agree with that view, and immediately launched proceedings for judicial review of the Government's transposition of the EU directive. Just to make the story a little more bizarre and exciting, the TUC engaged Cherie Booth QC to advise it. Ms Booth is evidently a very eminent lawyer, whose advice was rather different to that given by the lawyers for the Department of Trade and Industry. They advised the Minister that the Government's provision was in accordance with the directive, but Ms Booth, who apparently has no communication with other arms of government, advised the TUC that the Government's provision was not in accord with the directive. The TUC commenced proceedings for judicial review of the decision, and the case went before the High Court in London and was referred to the European Court of Justice. In July 2000, the TUC appealed unsuccessfully to the Court of Appeal for an immediate decision, but the case was listed for hearing in the European Court of Justice on 3 May 2001.

According to the TUC—the Minister may tell me that it has misinformed me—less than a week before the hearing was scheduled in the European Court of Justice, it was approached to discuss terms on which the case might be settled. Some members of the Committee might think that that is slightly different from the Government believing that the time is right to include parents whose children were over the age of five in December 1999.

Alan Johnson: The two coincide.

Mr. Hammond: The Minister says that the two coincide, but it strikes me that what coincided was the listing of the case in the European Court of Justice and the approach of the general election of 2001.

Alan Johnson: Which we won.

Mr. Hammond: The Minister is right to say that his party won. Its campaign was substantially financed by the trade union movement, which the Prime Minister had some difficulty keeping in check at that time. I may return to the timing coincidence in a moment.

Let us consider the rather dramatic courtroom steps deal between the TUC and a Government about to seek re-election, with a large slug of finance for their election campaign coming from trade unions. Given also that the TUC was advised by the wife of the Prime Minister, it sounds rather more like a novel than an everyday story of Government incompetence.

Will the Minister tell us how much taxpayers' money has been lost on the legal fiasco, not to mention the parliamentary time clearly wasted on having to return to the issue? The TUC press release made it clear that one of the terms of the settlement was that the Government were to pay the TUC's legal costs including, no doubt, the substantial fee of Ms Booth QC. How much taxpayers' money has gone towards meeting those costs, as well as the Government's own legal costs?

Why did the Government wait until one week before the case was scheduled to be heard in the European Court of Justice and then give in to the TUC's demands? If the Government were confident of their case—presumably they were, or they would not have allowed the matter to run until May 2001, clocking up additional legal costs—why did they not take it to court and test it? The Irish Government caved in when faced with threats of legal action, so the issue had never been tested in court. However, the Minister said in Committee:

    ``All our legal advice tells us that our provision is in accord with the directive''.—[Official Report, Fifth Standing Committee on Delegated Legislation, 2 December 1999; c. 15.]

What happened in May 2001 to make the Minister suddenly change his mind about the strength of the Government's legal position and decide that the TUC was right after all?

Why was the legal action not mentioned in the DTI's press release in April, which announced that the Department intended to extend the provisions? There was no mention of the TUC, Cherie Booth or legal challenges. The then Secretary of State--he is now the Secretary of State for Transport, Local Government and the Regions--stated:

    ``In our recent consultation, parents have told us that extending parental leave to all those with pre-school children would make a real difference to their daily struggle''.

He added that parental leave had ``worked well'' and that the time was right to extend it

    ``to all parents with children under five''.

Will the Minister clarify whose idea it was to put that spin on the press release? We all know that the Secretary of State has been associated with some eloquent spin, and that looks like yet another example of it.

Who dictated the terms of the concession on the start date? The Minister appears to have accepted that the original provision did not implement the terms of the EU directive effectively because it imposed both an age limit and a start date, but what he has done is bizarre. He has provided that parents of children up to and above the age of 10 will be able to claim parental leave during the start-up period. The Government have now said that parents of children born after December 1994 will be eligible to take this leave up to 2005, yet the logical purpose of setting a cut-off age of five is that parents need to spend time with their children during those crucial formative years up to that age. The logic of the Government's position completely eludes me. To placate the TUC, and as the price of getting out of the messy situation into which they have got themselves, they are offering parents whose children were born between December 1994 and December 1999 parental leave at a time when their children are aged six, seven, eight, nine and 10. That will not be available to subsequent cohorts of parents whose leave entitlement will end when those children are five. Unless I have missed something obvious, the proposal is contrary to the original purpose stated by the Government when they introduced the regulations.

The Minister also told the Committee in December 1999 that the Government had

    ``decided to start them on a specific date, so as to avoid presenting employers with a major problem.''— [Official Report, Fifth Standing Committee on Delegated Legislation, 2 December 1999; c. 14.]

Does the Minister concede that if that was the purpose in setting the December 1999 start date, removing that start date will present employers with major problems?

The Government, after resisting for all those months the logic of the TUC's positon and the opinion of Ms Booth, which they presumably had sight of, finally caved in. In the immediate run-up to the general election, they not only conceded the point but conceded more to the TUC than was strictly required to head off the legal challenge. That is the price that the Government were evidently prepared to pay for the TUC's silence or support in the run-up to the election, but it will be the businesses that will actually pay that price, at least in the short term. Another burden is being imposed on businesses—a burden that they did not expect, which the Minister told the Committee in 1999 should not be imposed on them, and which did not need to be imposed on them to meet the legal requirements of the directive.

I turn to the question of burdens on business—although it is becoming a hackneyed phrase.


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Prepared 7 November 2001