Employment Bill

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Alan Johnson: The hon. Gentleman makes a good and powerful point. His asked earlier whether we would arrive at the same position if we removed subsection (4). The answer is probably yes, but we would not have mirrored exactly the statutory maternity pay provisions. Despite his powerful case, does he accept that, had we moved away in any form from statutory maternity pay provisions, we would have run the risk of confusing the issue and of suggesting that the provision contained something different? That offers at least some defence for carrying over the same language, though perhaps we have not looked as closely as we might have done at tidying it up.

Mr. Hammond: The Minister has made the best argument for leaving the subsection as it is—that it is consistent with what is already there. I have had that argument with many other Ministers in debating Bills. There is a point in saying, that a broad, permissive power will be exercised in certain ways, but there is no point in simply reiterating specific cases that the Secretary of State may use his powers to address, because he is being granted substantial and all-embracing powers.

I do not know why that provision was included in the original maternity pay provisions, but it seems to me to be merely a statement of intent of the kind that, for much of the Bill, has been made in the explanatory notes. A provision could say that regulations under some other subsection ''may'' make provision for the statutory rate of pay to be £X or ''may'' make provision for the number of qualifying weeks of employment to be 26, but it could say something else. That gets us nowhere, except to give us an indication of the Government's broad thinking.

I think that that makes the point in relation to the general ''shall'' or ''may'' debate. As soon as the word becomes ''shall'', it has a structural purpose. I think that the Minister has answered the point that I was addressing in amendment No. 175. Because penalties are attached to failure to produce records later on, and I have a later amendment limiting that to records that are required to be kept, I wanted to be sure that the Government intend to make regulations to define the records that are to be kept, so that there is not open-ended jeopardy with regard to record-keeping and production. If I have understood the Minister correctly, he is confirming that the Government intend to define the records that will need to be kept under the provisions of this part of the Act.

I have got into the habit of speaking to clause stand part debates, and had forgotten that this was an amendment. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 7 ordered to stand part of the Bill.

Clauses 8 and 9 ordered to stand part of the Bill.

Column Number: 430

Clause 10

Powers to require information

Mr. Hammond: I beg to move amendment No. 177, in page 24, line 10, leave out ''has been'' and insert

    ''was at the time of the claimed entitlement''.

The Chairman: With this it will be convenient to take the following amendments: No. 178, in page 24, line 12, leave out ''has been'' and insert

    ''was at the time of the claimed entitlement''.

No. 179, in page 24, line 14, leave out paragraph (d).

No. 180, in page 24, line 17, leave out paragraph (e).

Mr. Hammond: Amendment No. 177 takes us to clause 10(2). Amendment No. 178 reflects a similar change to the language in the following paragraph. Paragraphs (b) and (c) are affected. As drafted, the Bill refers to a power by regulations to enable an officer of the Inland Revenue to require persons of a specified description to produce information to that officer. Clause 10(2) describes classes of person

    ''which may be specified by regulations under subsection (1)''.

Clause 10(2)(b) includes in the definition of classes of person who may be specified by regulations to be required to produce information

    ''any person who is, or has been, the spouse or partner of such a person as is mentioned in paragraph (a)''.

I do not want to suggest that we are on an inexorable slide towards a police state, but clearly that could be a wide-ranging and all-encompassing provision. I suspect that it is quite unreasonable to include anyone who has ever been the spouse of a person mentioned in paragraph (a)—that is, a person claiming to be entitled to statutory paternity pay—among those subject to a requirement to produce documents and information.

The amendment seeks to limit the liability of a former spouse or partner to a person who was a spouse or partner at the time of the claimed entitlement referred to in paragraph (a). It seems to me to be reasonable to demand information from such a person, but unreasonable to include any former spouse or partner in the definition.

Mr. Osborne: Does my hon. Friend agree that the clause would allow the introduction of a system, which I suggested earlier in the Committee, to have the mother of a child countersign an assessment made to claim paternity pay? The Minister did not think that that was a good idea, but my hon. Friend did.

Mr. Hammond: I heard my hon. Friend's suggestion and I hope that the Minister took it on board. I am not sure that the paragraph would grant to the Secretary of State the power to require countersignature that he is seeking. I take it to be more about the investigation of suspected fraud and abuse. We are anxious to support the war against crime in relation not only to social security fraud, but to more general anti-terrorism measures. However, as the Opposition we are required constantly to be vigilant in defence of the legitimate freedoms of individuals. This measure, taken literally, is an unwarranted extension of the power of the Secretary of State.

Column Number: 431

6.30 pm

Mr. Prisk: Does my hon. Friend agree that the measure could prove to be wholly impractical if there is not a sensible time limit as suggested by amendments Nos. 177 and 178?

Mr. Hammond: There could be great difficulties. It is necessary to define the information that is required to be kept in the form of records that can be sought. We do not want people to be vulnerable to penalties for not having information that they could not reasonably be expected to know that they were required to retain. That applies to employers in particular. That deals with amendments Nos. 177 and 178.

Amendment No. 179 is a probing amendment. As the Minister will be aware from other matters that are being dealt with by his Department, the employment agency sector feels put upon by much of the legislation that is coming from the European Union, which creates additional burdens for that booming area of business. I can understand why it is necessary to have the power to require information from people carrying on an agency business—that is, supplying temporary or long-term workers and being remunerated for doing so. However, the definition in the Bill is

    ''an agency or other business for the introduction or supply to persons . . . of persons available to do work or to perform services''.

That would include agencies whose sole business was the making of introductions, whereby an employer enters into a contract directly with the employee and pays a fee to the agency for making the introduction. It would not be appropriate for that type of business to be vulnerable to being classed as a person specified in regulations as someone who is required to produce documents and records for the Inland Revenue. I cannot envisage what documents such a business or person could have that could possibly be relevant.

I am also slightly nervous about paragraph (e), and amendment No. 180 probes the Government by seeking to remove it. When one is trying to draft lots of probing amendments late at night, that is by far the easiest way of doing it. One can then think the next day about exactly what one wants to ask. A person who works for any of these agency businesses would be required to produce documents to an Inland Revenue officer. There may be a technical legal reason why the law has to bite on the employees of such businesses. However, we would not want a ''servant or agent''—as the Bill quaintly describes an ordinary employee—to be vulnerable to penalties because they were unable to produce a document that their employer was supposed to keep for the Inland Revenue. I wonder whether it is over the top to have a specific ability to make regulations requiring employees of agencies to produce documents directly to an officer of the Inland Revenue. I should have thought that it would be more appropriate to define the person who is required to produce the document as the business itself, which would act through the agency of its servant or agent in producing the document and handing it over.

Column Number: 432

Alan Johnson: The hon. Gentleman is right: clause 10 is important in providing the necessary backstop for dealing with the minority of employers and employees who do not want to co-operate. It will be essential to counter fraud and negligence.

I understand where the hon. Gentleman is coming from. He wants to make sure that Inland Revenue officers have no power to dig around in issues that should not concern them. I draw his attention to the overriding principle set out in clause 10(1), which contains the word ''reasonably''. The information must be reasonably required in order to check out whether there is an entitlement to statutory paternity or adoption pay. That provides an absolute safeguard in that an Inland Revenue officer must have good grounds for supposing that the person from whom he wants to obtain information has information relevant to the matter in hand—indeed, that it is critical to the matter in hand.

If the Bill were drafted in the way set out in the amendment, an additional and unnecessary step would be imported into the process. The officer would have to prove the former partner's or employer's status at a specific time, which would be unworkable. Indeed, their status might be part of the dispute. An employer could argue that an employee left their employment on a date before the entitlement to statutory paternity pay started, while the employee could argue that they were still employed. To sort that out, the Inland Revenue officer would need to see payroll and personnel information, but the employer could refuse to co-operate by maintaining that they were not the employer at the time of the entitlement. It would be difficult for the Inland Revenue to pursue that if the amendment were carried. I am sure that the hon. Gentleman can appreciate the problems that that might produce.

The amendment is not necessary because the effect is already achieved by the clause. Nor is it workable because it would import an additional complexity into the operation of the clause.

 
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