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Standing Committee A
The Committee consisted of the following Members:
Chairmen:
Mr. Eric Forth, †
Hugh Bayley
Bone, Mr. Peter (Wellingborough) (Con)
†Brown, Lyn (West Ham) (Lab)
†Dhanda, Mr. Parmjit (Gloucester) (Lab)
†Johnson, Ms Diana R. (Kingston upon Hull, North) (Lab)
†Khan , Mr. Sadiq (Tooting) (Lab)
Kirkbride, Miss Julie (Bromsgrove) (Con)
†Laing, Mrs. Eleanor (Epping Forest) (Con)
†Lamb, Norman (North Norfolk) (LD)
†McGovern, Mr. Jim (Dundee, West) (Lab)
†Morgan, Julie (Cardiff, North) (Lab)
†Munn, Meg (Parliamentary Under-Secretary of State for Trade and Industry)
†Prisk, Mr. Mark (Hertford and Stortford) (Con)
†Reid, Mr. Alan (Argyll and Bute) (LD)
†Stewart, Ian (Eccles) (Lab)
†Sutcliffe, Mr. Gerry (Parliamentary Under-Secretary of State for Trade and Industry)
†Ussher, Kitty (Burnley) (Lab)
†Walker, Mr. Charles (Broxbourne) (Con)
Emily Commander, Frank Cranmer, Committee Clerks
† attended the Committee
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Tuesday 13 December 2005
(Morning)
[Hugh Bayley in the Chair]
10.30 am
The Chairman: I remind the Committee that there is a money resolution in connection with the Bill. Copies are available in the Room. I should also like to remind Members that adequate notice should be given of amendments. As a general rule, I and my fellow Chairman do not intend to call starred amendments, including any which may be reached during an afternoon sitting of the Committee. I call on the Minister to move the programme motion.
The Parliamentary Under-Secretary of State for Trade and Industry (Meg Munn): I beg to move,
(1) during proceedings on the Work and Families Bill the Standing Committee shall (in addition to its first meeting at 10.30 a.m. on Tuesday 13th December) meet—
(a) at 4.00 p.m. on Tuesday 13th December;
(b) at 9.00 a.m. and 1.00 p.m. on Thursday 15th December
(c) at 9.00 a.m. and 2.00 p.m. on Tuesday 20th December
(2) the proceedings shall be taken in the following order; Clauses 1 to 11; Schedule 1; Clauses 12 to 15; Schedule 2; Clauses 16 to 20; new Clauses; new Schedules; remaining proceedings on the Bill;
(3) the proceedings shall (so far as not previously concluded) be brought to a conclusion at 5.00 p.m. on Tuesday 20th December.
Good morning, Mr. Bayley. I warmly welcome you to the Chair and am genuinely delighted that you will supervise this morning’s discussion. I also welcome all members of the Committee, and the Opposition spokespeople. It seems that only last week we were in another Committee elsewhere—which, indeed, we were.
Several of my hon. Friends warmly supported the Bill on Second Reading. I am grateful to them; several Opposition Members who are present also took part in that debate. There is wide support for the Bill from many organisations, including from business. I look forward to a constructive debate that allows the Committee to scrutinise the Bill thoroughly. Members of the Committee will have noticed that the programme motion contains no knives, and no doubt they will welcome that. That gives us flexibility to consider fully issues that deserve particular discussion, and to move more swiftly over issues of lesser significance. I commend the motion to the Committee
Mr. Mark Prisk (Hertford and Stortford) (Con): I am delighted that we are under your leadership, Mr. Bayley. I think this is the first time that I have been guided by you in the role of Chairman, and I look forward to that in the coming few days. I welcome both Ministers who are here today, and also my hon. Friend
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the Member for Epping Forest (Mrs. Laing), who understands these issues far better than I ever shall. I am delighted to be here in her support.
We have before us up to six potential sittings; I know how much Labour Members are looking forward to the sittings on Tuesday next, as are Opposition Members. We will, I am sure, have the opportunity here for a full and thorough scrutiny of the issues. As the Minister rightly mentioned, we share much of the Government’s view on the importance of the role of work and families. Indeed, we wish to ensure that the quality of the legislation before us is the best that we can manage. That is why we shall be asking questions to probe the Government’s intentions and aims. Without such scrutiny, we would be failing in our duty. I am sure that Labour Members will wish to participate in that process.
Therefore, on this occasion—and I do not often get the chance to say this—I welcome the fact no timetable instruments, or knives as they are colloquially known, have been put into this motion. One simple reason that Opposition Members raise concerns about such timetables is that they interfere with the quality of the scrutiny process. It means that we sometimes have to guess which amendment we need to focus on to deal with the big issues, and often forces us to leave out smaller issues. Those may be particularly important to our constituents, but we nevertheless have no time for them because we are racing to catch up with those amendments which are perhaps at the back end of a timetable, or knife. Thus it is especially welcome that the motion before us today does not include such knives. I hope that means we shall be able to tease out the details here. We certainly look forward to a thorough and positive exchange.
Norman Lamb (North Norfolk) (LD): May I also welcome you to the Chair, Mr. Bayley? It is a pleasure to serve under your chairmanship. I, too, welcome the two Ministers to this morning’s debate and, although he did not welcome me in his introductory remarks, I welcome the hon. Member for Hertford and Stortford (Mr. Prisk).
We support the Bill’s objectives. In many respects, it is an acknowledgment of the revolution that has occurred in the workplace from the days when it was dominated by men, who were the single breadwinners. The world has changed much since then when people worked full-time and were the sole breadwinners. There is an economic imperative for facilitating women remaining in employment, but in a way that also meets the needs of families and of children. There is equally a need to ensure that fathers are able to achieve a better work-life balance.
There are concerns about some of the Bill’s details. There is clearly a need, probably shared on all parts, to ensure that we avoid over-burdensome obligations, particularly on small employers. One of the amendments that I have tabled seeks a way of reducing the burden on them. We must be alert to that, because although is it right to ensure that mothers and fathers can achieve the better work-life balance that we are all striving for, we must recognise that when any employee takes time off work, it has an impact on the
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employer. The impact is greatest on small employers, and everything must be done to ease the burden on them.
The Chairman: Order. May I say to the hon. Gentleman that at this point in our proceedings we are discussing the programme motion? We will come to the wider questions of the Bill’s content as we discuss his amendments and those of other hon. Members.
Norman Lamb: I am very grateful for that guidance, Mr. Bayley.
May I also briefly raise the concern that the Bill leaves an awful lot to regulations? Inevitably, there is a concern about that. The TUC, among others, has highlighted the vagueness of the Bill in that respect. In addition, there is nothing about the time scale for the introduction of regulations. The TUC also refers to the fact—
The Chairman: Order. I must say to the hon. Gentleman that we must leave questions about the content of the Bill and certainly the views of other organisations until we reach the debates on the content of the Bill. We are now discussing the programme motion and the timetable for considering the Bill.
Norman Lamb: I thought that the Conservative spokesman made some general comments, and I was merely seeking to make general comments about the presentation of the Bill and the extent to which it relies on regulation. I take your guidance, Mr. Bayley, and I will not push you any further in this respect.
Question put and agreed to.
Clause 1
Maternity pay period
Norman Lamb: I beg to move amendment No. 10, in clause 1, page 1, line 7, after ‘weeks’, insert
‘; but a woman taking maternity leave who takes less than the maximum prescribed period is entitled to receive the same total amount of statutory maternity pay that she would have received had she taken the maximum prescribed period, paid so far as practicable by equal weekly instalments.” ’.
The Chairman: With this it will be convenient to discuss the following amendments: No. 11, in clause 2, page 1, line 11, after ‘weeks’, insert
‘; but a woman receiving statutory adoption pay who takes less than the maximum prescribed period is entitled to receive the same total amount of statutory adoption pay that she would have received had she taken the maximum prescribed period, paid so far as practicable by equal weekly instalments.”’.
No. 12, in clause 6, page 5, line 45, leave out ‘and’.
No. 13, in clause 6, page 5, line 48, at end insert
(c) provide that a person receiving additional statutory paternity pay who takes less than the maximum prescribed period is entitled to receive the same total amount of additional statutory paternity pay that he would have received had he taken the maximum prescribed period, paid so far as practicable by equal weekly instalments.’.
No. 14, in clause 7, page 6, line 46, leave out ‘and’.
No. 15, in clause 7, page 7, line 3, at end insert
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(c) provide that a person receiving additional statutory adoption pay who takes less than the maximum prescribed period is entitled to receive the same total amount of additional statutory adoption pay that he would have received had he taken the maximum prescribed period, paid so far as practicable by equal weekly instalments.’.
Norman Lamb: As I was saying, the Liberal Democrats very much support the increase in maternity leave proposed in the Bill. It seeks to increase the maximum period of maternity leave to one year. The indication is that that would be introduced by a phrased approach, by way of regulation. First, there would be an increase, by regulation, to nine months and then subsequently to a year by the end of this Parliament. That is a thoroughly sensible way of proceeding.
There is a problem with this new right, which, in a sense, relates to the level of pay. The level of pay for the bulk of the maternity leave is low: £106 at present. There is inevitably a risk that, for many people, it will be impossible to take the full period of maternity leave to which they will be entitled. It may be that there should be a long-term objective of raising that level of pay in a way that is achievable given overall Government expenditure.
In the meantime, however, it seems that it is worth trying to find ways of putting the power into the hands of the woman taking maternity leave to choose, if she wants, to take a shorter period of maternity leave than the maximum at a higher rate of weekly pay. In other words, every woman who takes maternity leave should be entitled to the full amount of maternity pay that she would receive under the period allowed by the Bill—ultimately, one year. However, if she chooses, she should be able to take it over a shorter period at a higher weekly rate. That follows the Swedish approach, introducing more flexibility and enabling the woman to choose how she will take the leave while ensuring that every woman is entitled to the maximum amount of maternity pay that can be provided for over the maternity pay period.
Some women might not take the full maternity period, but, if my amendment is accepted, they might take more than they would be able to take financially under the unamended Bill. The risk that we face is that the entitlement that the Bill provides will be meaningless for a group of women who cannot afford to take the full period at £106 per week. I appreciate that that figure will increase marginally year by year.
In my model, which introduces greater flexibility for the woman taking maternity leave, we may well see a situation in which a woman chooses to take nine months rather than a full year of maternity leave, but combines that with a request to the employer on returning for flexible working. In other words, we could envisage a phased return to the hours the woman chooses to work. Perhaps the woman could take nine months rather than a year, return on an agreed basis of flexible working to work two days a week and, if she is a full-time worker, increase that progressively until she is back full-time. In other words, it is about putting the power in the hands of the individual who is taking maternity leave.
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I suspect that, under my proposal, the total bill for maternity pay that the Government would have to meet would be higher. In effect, we would be saying that every woman would be entitled to the full amount of statutory maternity pay, but that she might be able to take it over a shorter period. Will the Minister tell us whether a calculation has been done of the extra cost of the amendment? It would be a pity if it were rejected on cost grounds because the Government are facilitating women taking the full period of maternity leave. Therefore, in theory, they must support women being entitled to the full amount of statutory maternity pay. The reality under the Bill will be that not all women will be able to take that for economic and financial reasons.
Mr. Jim McGovern (Dundee, West) (Lab): I think that I understand the hon. Gentleman’s point, but there is a danger associated with it. I assume that we agree that the purpose of maternity leave is to allow the mother to spend time with her new child, but does not this amendment provide an incentive for the mother to spend less time with her new child?
10.45 am
Norman Lamb: I think that the opposite is the case. The power will be in the hands of the woman. Some women will be financially able to take the full amount of maternity leave, but Ministers must accept that the reality is that not all women can do that. Many women will have to take less than that because they cannot afford to be off work at such a rate of pay for the full one-year period.
This measure would mean that more women will be able to take more time off, and to choose how to do that. If we have a situation in which a proportion of women cannot afford to take a full year so they take significantly less than that, I am sure that the hon. Member for Dundee, West (Mr. McGovern) would agree that that is not good. However, if the mother is able to take nine months at a higher weekly rate than for the full year, and that facilitates her taking the nine months off, perhaps combined with flexible working when she returns to work—a phased return—that will be a good thing that ensures that women are able to take more time off than would otherwise be the case.
Mr. Sadiq Khan (Tooting) (Lab): To follow on from the point made by my hon. Friend the Member for Dundee, West, is there not a problem in that someone could take a very short period of time off for maternity leave in order to get back to work as soon as possible so as to get a “windfall” by receiving the contractual pay entitlement as well as statutory maternity pay for the period when they are entitled to that? That would encourage people to go back to work sooner, when the purpose of the Bill is to allow mothers to spend more time with their newborn child.
Norman Lamb: The hon. Gentleman makes a good point, and I accept it completely. This is a probing amendment. It is designed to initiate a debate, so that we can discover whether there is a way of introducing
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greater flexibility and of giving more power to the woman taking the maternity leave, instead of the provisions being something of a straitjacket.
The principle behind my amendment is a strong one: more power should be given to the woman. If that were to happen, more safeguards might be needed to ensure that the entitlements apply for a defined period, so as to avoid the windfall that the hon. Gentleman refers to. However, I hope that we would all accept the principle that more power should be given to the woman to decide how to take that period of leave.
We should adopt the Swedish approach: there should be as much flexibility as possible and the woman should be given the power to decide. The amendment gives the woman the power to decide and helps more women to take more leave, and it does not in any way compromise her entitlement.
The other amendments follow on similar lines. Amendment No. 11 would ensure that the same principle was applied to adoption pay. Amendments Nos. 12 and 13 relate to statutory paternity leave and pay. The Government’s own assessment is that take-up of paternity leave will be very low. The regulatory impact assessment makes that very clear; I refer Members to pages 84 and 85 of the document. The prediction depends on whether the entitlement to additional paternity leave is based on 26 weeks’ service or 60 weeks’ service. If it is based on 60 weeks’ service, the Government’s own prediction is that 9,000 to 13,000 fathers will take advantage of the entitlement. That is a tiny proportion of the total. If there were a 60-week employment requirement, the total eligible for leave would be 380,000 and the total eligible for pay would be 238,000. The total anticipated to take the entitlement would be 9,000 to 13,000—as a percentage, that is tiny. We can make all sorts of grand statements about how the entitlement will transform the workplace, but let us be honest about its anticipated impact: that is tiny.
Mr. Prisk: I understand what the hon. Gentleman has said, but conversely is there not a different danger? If the Government assume that the take-up will be less than they have said, the costs could be dramatically different from those presented to us as we have considered this legislation. In other words, if the 9,000 were to become 18,000, that would make a radical difference to the cost, although I am not sure that it would double it. Does the hon. Gentleman share my concern that an underestimation is involved, which could be to the detriment of small businesses in particular?
Norman Lamb: I welcome the hon. Gentleman’s intervention; what he says may well be the case. We all need to be honest about the issue: do we believe in fathers taking paternity leave? I strongly believe in the right being introduced, but if the Government’s own estimate is that the take-up could be as low as 9,000, we shall not be introducing much of a right.
The danger is that the entitlement will be taken up only by those fathers who can afford to take time-off pay at that very low rate; it might become a middle-class entitlement and not one for people on lower
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earnings, who may have mortgage burdens and so on and simply not be able to afford to take the amount of leave provided for. If we are talking about trying to change the culture of the workplace and really ensuring that men are able to take time off and spend more time with their children during their early years, we have to do something effective to achieve that.
It seems much better to put the power in the hands of the father. I fully acknowledge the point made by the hon. Member for Tooting (Mr. Khan); adjustments may be needed to ensure that the allowance is not all taken as a windfall. However, surely it is better for a father to take, say, nine weeks off rather than the full entitlement, but at a rate of pay that ensures that he can do so. That is better than not taking it at all. That is the risk that we face, which was acknowledged by the Government in their regulatory impact assessment.
The case is strong. In principle, if we can put the power in the hands of fathers—perhaps with more safeguards to ensure that the entitlement is not taken as a windfall—and ensure that they are able to take advantage of the entitlement, that would be a good thing in changing the culture of the workplace and ensuring that men—and women, when they take maternity or adoption leave—take advantage of those rights. At the end of the day, that is what we all want.
Mrs. Eleanor Laing (Epping Forest) (Con): To observe the proper conventions, I should say that it is a great pleasure to serve under your chairmanship, Mr. Bayley. I welcome both Ministers. The Minister with responsibility for women and equality and I have probably spent more time together during the past six weeks than either of us have spent with any family at any time, so some of what we say this morning is said with heartfelt understanding.
Having said that, I strongly welcome the fact that the Government are taking all the measures that we have been debating and discussing in the past few months, because we thoroughly support the intent to help everyone to achieve the work-life balance that is essential not only to individuals and families but to business and the economy. That is a general point, however, wide of what we are now discussing. I shall not try your patience on it now, Mr. Bayley.
On the precise matter of amendment No. 11 and the others in the group, and the general assertions made by the hon. Member for North Norfolk (Norman Lamb), we agree in principle with what he just said. There may be differences of detail and, as ever, I make a cautionary point about how much public money could be spent, always bearing in mind that everything that we discuss in passing the Bill must be balanced with other matters on which we would want to spend taxpayers’ money. Still, in principle, I totally support what the hon. Gentleman said.
The fact is that all families are different. It is wrong for the Government to prescribe exactly how a new mother and father and family should behave, exactly how an employee should behave immediately after the birth of a child, how a family should balance its resources between the mother and father or anyone
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else in the family who is involved in the child’s upbringing, and how all employers should deal with their employees.
Those matters require a degree of flexibility, because every family—every mother, father and child—and every employer is different, as is every employer-employee relationship. In particular, there is considerable variation between large employers with a human resources department and plenty of flexibility about replacing one employee with another temporarily and smaller employers that do not have the flexibility to allow that. Therefore, for the Government to prescribe precisely how maternity and paternity leave and pay should work is not the best approach. Everything that I say about maternity and paternity rights should of course apply also to adoption rights, as the hon. Member for North Norfolk said.
In particular, we previously proposed—and made it an important plank of our manifesto for the general election—that should a new mother, or, indeed, new father, wish to take maternity or paternity leave or pay, it should be possible for them to receive the amount that would have been paid over nine months in six months, or a period in between those two, as a way of providing the flexibility, choice and adaptability that would fit the rights to each family.
If the Government confer a right but it does not help a particular person or family at the relevant time, that is pointless. It might as well not be given if the family—or the employee or employer, or the child, father or mother—cannot benefit. Flexibility is the key factor in making those rights work. It is hard to imagine why the Government would argue against somebody taking the same amount of taxpayers’ money in maternity or paternity pay but taking it over a shorter period of time.
11 am
Mr. McGovern: When would the mother decide the date of her return to work? It seems to me that if she wanted an increased payment, she would have to say so prior to the birth of the baby? Following the birth, the assessment could change and she might decide that she would need a longer period.
Mrs. Laing: I do not think that the woman would need to say so before the birth of the baby, although she might have to do so shortly after it.
Norman Lamb: On that point, may I assist by way of referring to the amendment? I suggest that, so far as reasonably practicable, the payment is made in equal weekly instalments, but clearly we cannot prescribe beforehand exactly how long the woman would choose to be off. If there is a balance to be paid at the end, she would know that she would be entitled to it. That is the way that the amendment would work.
Mrs. Laing: I thank the hon. Gentleman for clarifying exactly what his amendment says. As I said, I support his amendment in principle, but the detail will take further working out. It does not seem beyond the limits of practical administration that a new
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mother could, in the first few weeks after the baby’s birth, claim her maternity pay, taking it over the nine-month rate per week but that that could then be changed if she wished to shorten her period of maternity leave. Why not?
We all pay too much tax. We all, from time to time, might pay too much tax and then have the tax code changed to take account of that and pay less tax over the next year or receive a rebate. The Exchequer can surely manage to do a simple calculation of an amount that is due. When I think about it, that is a wild hope on my part, given the way in which tax credits are working. In my constituency alone it would take hundreds of man hours of Inland Revenue time to sort out the problems in the tax credit system.
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