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Session 2001- 02
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Standing Committee Debates
Employment Bill

Employment Bill

Column Number: 253

Standing Committee F

Tuesday 8 January 2002

[Mr. Joe Benton in the Chair]

Employment Bill

4.30 pm

The Chairman: Happy new year, everyone.

Mr. Philip Hammond (Runnymede and Weybridge): On a point of order, Mr. Benton. During the Committee's previous deliberations, the Government made it clear through the Minister that they intend to table substantive new clauses on a new issue. It is generally accepted that they will be discussed on the last day that the Bill is programmed to be in Committee. May I ask the Government, through you, Mr. Benton, to ensure, as a courtesy to the Committee, that the new clauses are tabled by the end of this week? Bodies outside this place will want to comment on the substantive issue and to interface with the Committee. If we are to consider the new clauses, discuss them with outside bodies and table amendments that are unstarred for consideration on Tuesday 22 January, it will be necessary to see them by the end of this week.

The Chairman: That is a matter for the Government. I do not know whether the Minister wants to comment on it.

The Minister for Employment and the Regions (Alan Johnson): Further to the point of order, Mr. Benton. It may be pushing it to table the new clauses by the end of this week, but I accept the point made by the hon. Member for Runnymede and Weybridge (Mr. Hammond) that plenty of notice is required, particularly concerning the right to request flexible working and to have that request considered seriously. I shall do my best to circulate the new clauses to the Committee well in advance of our debate, but I shall have to take soundings on whether I can do so by the end of this week. I fully accept the general spirit of the hon. Gentleman's comments and will do my best to circulate them as soon as possible so that the Committee has time to consult on and consider them.

Clause 1

Paternity leave

Mr. Philip Hammond: I beg to move amendment No. 96, in page 2, line 4, leave out 'shall' and insert 'may'.

The Chairman: With this it will be convenient to take the following amendments: No. 97, in page 2, line 11, leave out 'shall' and insert 'may'.

No. 100, in page 2, line 21, leave out 'may' and insert 'shall'.

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Mr. Hammond: I reciprocate your good wishes for the new year, Mr. Benton, and extend them to all Committee members.

I suspect that any member of the uninitiated who is observing our deliberations might be slightly alarmed to discover that at our eighth sitting we are discussing clause 1, but there is of course an explanation for that.

Perhaps you will allow me, Mr. Benton, to say a few words about part 1, which covers statutory paternity, adoption and maternity leave, and pay. There are some general issues concerning the desirability of promoting family life and making it as easy as possible for people to indulge in it. My hon. Friend the Member for West Dorset (Mr. Letwin) will make a well-trailed speech this evening on the creation of a neighbourly society in which people will, to use his phrase, be brought up right. It is part of a wider agenda to address the collapse in the moral fabric of our society and that is essential to us all if we want to live in a prosperous and safe society. It relates to such issues as ensuring that children and young people are properly brought up and educated and that we reduce the endemic crime in our inner cities, much of which, if we read the Government's reports, is committed by very young people. We all have a shared interest in ensuring that children are brought up and educated properly so that our society has the necessary skills to deliver economic prosperity in future and that our future citizens have the civic skills to ensure that we live in a safe and agreeable society. There is no question in my mind of the value of ensuring proper parental attention to children at vital stages of their development, and—perhaps slightly less positively—of proper parental control. Members of the Committee who are privileged to be parents will be familiar with the stage when children stop needing so much attention and start needing a bit more control.

The important point is that society benefits: we need proper parental attention for the good of society as a whole. What the Opposition, and perhaps others, will want to address is where the cost of delivering that benefit will fall. We live in an increasingly materialistic society, and, often, both parents—where there are two parents—work to achieve the lifestyle to which families aspire, and I am certainly not going to knock that.

Having listened to Second Reading and to wider debates, Committee members will expect us to consider the burden that will be imposed, particularly on small businesses, in the interests of delivering what I fully acknowledge is a good to the wider community. The issue is of great importance, not just because business suffers the immediate burden of costs and regulatory compliance, but because if business suffers, we all suffer in the medium to longer term. If business is not efficient and competitive, society will be less prosperous, unemployment will be higher and we will be less able to maintain our competitive position in the world.

We need only look to Germany for a warning spectre of the way in which well-intentioned improvements in employment conditions can have unintended and negative consequences if they are not

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carefully monitored. I worked in Germany during the late 1970s and 1980s, when its economy appeared to be gravity-defying. Employment costs were very high, yet the world clamoured to buy German goods. Part of the reason was that skill levels in the work force were also very high, and the unit cost of employment seemed more reasonable in that context. However, the world has caught up with Germany.

Of course, we have our own economic troubles. Two reports published today—by the General, Municipal, Boilermakers and Allied Trades Union, and the Engineering Employers Federation—paint a pretty gloomy picture. The gloom is relative, however, because in comparison with the German economy—Germany is teetering on the brink of having 4 million unemployed—ours looks almost rosy. The lucky ones who are still in work continue to enjoy the generous employment protections and benefits that have been enshrined for the German work force, but the cost is an uncompetitive labour rate in many sectors of German industry, rising unemployment and the export of German jobs to less expensive countries. I know a little about that, because I was involved for some years during the 1980s in the process whereby medium technology business in Germany was expatriated to Estonia, Poland, Czechoslovakia and other countries with lower labour costs. We must beware of that danger.

I realise that this issue tends to give rise to knee-jerk reactions. Conservative Members often talk about burdens on business, and the Government retort that what we call burdens on business are just decent employment protection and practice. However, the argument is subtler and deeper than that and is about getting the balance right and ensuring that burdens do not become so great, or fall on certain sectors in such a way, that they have unintended or negative consequences. One of our concerns is that the Government may impose, by statute, additional costs on employment that apply across the board to world-class competitive industries, which can readily and easily absorb them, and to highly marginal companies that are struggling to keep their heads above water in the face of overseas competitors. That is the problem with the statutory blanket imposition of measures for higher labour costs or less flexibility in the labour market and their indirect costs on businesses.

The matter before us will generate heat, and many of my hon. Friends will wish to contribute to the general debate. I have tabled amendment No. 93 to clause 21 as an artificial construction deliberately designed to allow us to debate the general issue of burdens on business for the benefit of society. My intention is to stay away from that debate until we reach that amendment. I shall deal with preceding clauses and amendments on a more or less technical basis and examine matters that arise from the drafting of the Bill, returning to the broader debate under amendment No. 93.

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A seemingly long list of amendments to clauses 1 and 2 lies before us, but most of the amendments are probing and intended to clarify the Government's underlying intentions and draw out details about the regulations that they intend to introduce to the House. I expect that they will be addressed in a quick-fire sequence and that we will race through them at speed.

I now turn to amendments Nos. 96, 97 and 100. I am glad that the Minister for Employment and the Regions, who dealt with the previous clauses, is here. I do not have the exact quote, but when responding to an earlier amendment, which sought to delete ''may'' from a sentence to the effect that ''the Secretary of State may make regulations'', and to insert the word ''shall'', the Minister emphatically told me that ''may'' was part of standard parliamentary drafting and that there are many good reasons for using that word. However, several of clauses in this part of the Bill state that the Secretary of State ''shall'' make regulations. Since I am a spokesperson for the Opposition and the job of Opposition is to oppose, I felt it appropriate to seek to delete ''shall'' and insert ''may'' so as to probe the Minister on what the Committee should read into the language of these clauses, given his earlier comment that conventional parliamentary drafting uses the permissive rather prescriptive form.

4.45 pm

A more substantive point is that where the language of the Bill states that the Secretary of State ''may'' make regulations, the Minister will reasonably be able to argue that the Secretary of State may or may not make them. As Ministers often tell us, the beauty of secondary legislation is its flexibility, because regulations can be made and replaced as necessary. Where the language in the Bill is prescriptive, as in the case of new section 80A:

    ''The Secretary of State shall make regulations . . .

    (a) as to duration of employment

    (b) as to relationship with a newborn, or expected, child, and

    (c) as to relationship with the child's mother'',

the Committee is entitled to ask about those regulations. What will the Secretary of State say about the duration of employment? What will he say about the relationship with a newborn child? What will he say about the relationship with the child's mother?

That is not something that might happen, but something that, as a result of the language in the Bill, will be required to happen. It is reasonable for us to assume that if the Government have written into the Bill that regulations will deal with these issues, they must know how they will deal with these issues and what they intend to say. Why can the duration of employment and the relationship with a newborn or expected child not be stated in the Bill? It is reasonable to expect in a section headed ''Entitlement to paternity leave'' that a specified relationship with a newborn or expected child would be that of a father to a child, which is my understanding of paternity.

Why have we have moved from permissive to prescriptive language and why, given that we have this prescriptive terminology, can we not have the detail in the Bill?

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