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Lord Fraser of Carmyllie: My Lords, I must first make it clear that I do not intend to suggest in any way that the noble Lord has been involved in this matter or that he might have authorised the disclosure of this report to senior trade unionists. That is why in my opening remarks I specifically asked whether the Minister of State, Mr. McCartney, who has the primary responsibility for this Bill and for low pay issues within government, had authorised the disclosure, or whether his senior Minister in Cabinet, the President of the Board of Trade, had authorised it.

I accept the noble Lord's bona fides in this matter. However, I am bound to say that my credulity is stretched when on Thursday in the Daily Telegraph Mr. Monks can offer authoritative comment on the contents of the report, and on Sunday another senior trade unionist can appear on television and offer similarly authoritative comment on the report. He was quite open about having not only an executive summary, but the full report which he had read from cover to cover. I find it extremely difficult to believe that somehow or other a copy of the report of the Low Pay Commission was spirited out of the DTI or some other department and happened to find its way into the hands of individuals such as Mr. Monks or Mr. Edmonds, and that no one knew anything about it.

As I say, I do not attribute any personal blame to the noble Lord or suggest that he authorised the disclosure, but the matter looks extremely suspicious. I do not withdraw my comment that it appears to be hugely partial to allow senior trade unionists access to this report before anyone in Parliament has the opportunity

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to consider it. We are extremely concerned about the matter. We are prepared to make progress on the Bill but we shall certainly pursue the matter in correspondence and in questions. It simply will not do to have another report being circulated to which Parliament ought to have access. If nothing else, the Minister should indicate to us that he will have an inquiry undertaken to discover how these senior trade unionists have one or more copies of the report, and whether that was authorised by anyone. If it is concluded that there has been a leak, we would expect something to be done about it. At the very least we would hope that the noble Lord would offer an apology to your Lordships' House for the way in which we have been treated in this matter.

Viscount Thurso: My Lords, before the Minister responds, I do not think I have ever seen GMTV either. Before I entered the Chamber this evening I was totally unaware that this matter would be raised. Perhaps I might ask that when notice is given of these matters it might be extended to Members on these Benches also. Clearly it is disturbing if a report is released which should come before Parliament. I accept the assurances that have been given by the noble Lord, Lord Clinton-Davis. Furthermore, I think it is slightly disingenuous of the noble and learned Lord, Lord Fraser of Carmyllie, to indicate that he may be prepared to hold up the business of your Lordships' House in Committee on this point.

Lord Fraser of Carmyllie: My Lords, the noble Viscount might have listened to what I had to say. The noble Lord the Government Chief Whip probably noted my remarks with rather keener interest when I said that while I would pursue the matter in correspondence and questions I did not wish to hold up the business at this stage.

Viscount Thurso: My Lords, I am most grateful to the noble and learned Lord for that assurance. Having not had notice of what was to be said and the consequences of it I had to listen rather harder to the exchanges. As I said, I am prepared together with, I believe, Members on these Benches, to accept the assurances of the noble Lord, Lord Clinton-Davis. I hope that we can now get on with this important piece of legislation.

Baroness O'Cathain: My Lords, before the Minister responds to that point, I make the observation that as there appears to have been not a leak but a general distribution of this report, would it not be in the best interests of the quality of debate within this Committee and the contribution that can be made from all four corners of this Committee to this important issue if the Minister could give us the undertaking that the report could be issued to us as soon as possible, that is, either tonight or tomorrow?

Lord Clinton-Davis: My Lords, I certainly cannot respond affirmatively to the noble Baroness in that way. Moreover, I want to say definitively that there has been

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no general distribution of the report. I am obliged to the noble and learned Lord, Lord Fraser, for saying that he is content to make progress, but before we move on to the Committee stage I want to say that I refute the allegation, on the basis of the information that I have, that any Minister authorised the release of this report to anybody.

I cannot go beyond that. I hope that we can now make progress, and of course a statement will be made at the earliest opportunity. I am not in charge of this Bill within the department. The noble and learned Lord knows perfectly well that it is my honourable friend the Minister of State who is in charge of it. I am here speaking together with my noble friends at the Committee stage and on behalf of the Government during this stage and succeeding stages of the Bill. That being the case, I hope that we can now move on.

On Question, Motion agreed to.

House again in Committee accordingly.

7 p.m.

[The DEPUTY CHAIRMAN OF COMMITTEES (Baroness Nicol) in the Chair.]

Clause 9 [Duty of employers to keep records]:

Baroness Miller of Hendon moved Amendment No. 65:

Page 7, line 30, after ("such") insert ("reasonable").

The noble Baroness said: I should like to speak to Amendments Nos. 65, 67 and 68, all of which relate to Clause 9. They are intended to improve the working of the Act, as it will be, and its administration. It is entirely right and proper that employers should be required to keep adequate records to enable employees and the authorities responsible for the enforcement of the Act to see whether the minimum wage has been paid. We support that. Our reasons for putting forward Amendments Nos. 67 and 68 are that the clause as drawn at present gives rise to the possibility of an extra, unnecessary and entirely superfluous set of records being required.

Employers are already required to keep substantial and detailed records of pay and benefits for the purposes of PAYE and national insurance. These records adequately provide all the information that an employee will require about the remuneration that he has received. Their accuracy is guaranteed so far as possible under the sanction of severe financial and possible criminal sanctions under the taxation and social security law.

Where the tax and national insurance records do not meet the needs of an employee for the purposes of this Bill is that they do not show the number of hours worked and possibly details of matters which the Low Pay Unit says are to be taken into account in calculating net pay for the special purposes of this Act. This potential deficiency in the records is, I believe, partially covered by the second half of the proposed new subsection (2), starting in Amendment No. 67 with the words,

    "save for details of the number of hours worked and any benefits in kind".

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In other words, under this clause the employer still has to keep records on the number of hours worked, but even this does not go far enough to assist the employee. So in addition there is the new subsection proposed in Amendment No. 68, which I assume would be numbered (4).

This will allow records which will eventually be required to be kept by the employer in compliance with the European Community Working Time Directive also to satisfy the requirement to keep records under this Bill. I cannot believe that the bureaucratic requirements of the European Community will not be entirely sufficient for the purposes of the DTI.

I turn now to the modest Amendment No. 65 to be made to Clause 9(b). Once again, because of a quirk of the grouping list, I am speaking to it out of its logical sequence. Again, we agree that it is right that in formulating regulations with regard to the keeping of records provision should be made for how long those records should be retained. All the amendment requires is that whatever stipulation the Secretary of State may make in this regard should be reasonable, for, as drawn, the Bill enables her to require such records be kept for 20, 50 or even 100 years. Obviously no such nonsense is intended by the Government.

From the employee's point of view, it would be equally detrimental if an unreasonably short period of retention were to be prescribed. The Acts governing income tax, PAYE, national insurance and VAT all prescribe how long records are to be retained, and there is absolutely no reason why the regime under this Bill should require anything different. Rights under this Bill will essentially be a civil claim for a debt, and there is equally really no reason why the regulations should prescribe anything longer than the basic limitation periods for making civil claims.

However, I am not going to try to second-guess the Secretary of State. She can decide the period, as the Bill at present provides. All that she has to do is to see that the period is reasonable. I asked for the word "reasonable" to be inserted in Clause 1(4) in my Amendment No. 4 which was discussed last Thursday. The Solicitor-General spent a little time trying to justify the proposition that it would be inhibiting to the operation of the Bill if there was a specific requirement to be "reasonable". In effect he said, "Trust us: we are the Government". Well, I am casting no aspersions, but in the case of the present amendment, if the Government's word is as good as their bond, then let them give us their bond. Frankly, I was unable to understand the logic of the argument that if the word "reasonable" was used in the Bill it would generate a flood of litigation. Leaving out the word, however, does not exempt the Secretary of State from being reasonable in any reasonable interpretation of that word.

The Minister is perfectly well aware that there is a right for an aggrieved citizen to have the court's rule on irrational and unreasonable conduct by a Minister. This right was fully defined in the case of Associated Provincial Picture Houses v. Wednesbury Corporation in 1948. In that case the late and highly distinguished Master of the Rolls, Lord Greene, codified the law into

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what are called the Wednesbury Rules. The present Lord Chancellor described the Wednesbury Rules as the locus classicus of British administrative law.

In other words, the Government cannot escape from the duty of being reasonable by not including that word in this Bill. They cannot, ostrich-like, hide their heads in the sand and pretend that this elementary and essential obligation on their part does not exist. An aggrieved citizen will still be entitled to take the Government to court if he believes that they are behaving unreasonably. Agreeing to the use of the word is therefore merely a promise by the Government about their future conduct.

Whatever theoretical objections there were to promising to be "reasonable" for the purposes of Clause 1, which we debated ad nauseum last Thursday, there can surely be absolutely none for this clause. There is ample precedent for the periods for which records are required to be retained for taxation and similar purposes. It bears repeating that the burden of this Bill is largely going to fall on the small and medium-sized businesses. Larger concerns will be able to absorb the administration involved into their pay and accounts departments, but in the case of SMEs this will just add to the work to be done, usually by local shops: businesses like hairdressers and small-sized manufacturing operations. There is no reason to add to their administrative costs and red tape and to provide work for even more inspectors when entirely adequate records are already available. Equally, we do not want to see some wretched local shopkeeper being dragged before the magistrates or subjected to an administrative penalty, not because he did not keep perfectly adequate and practical records but because he did not do so on a particular design of form prescribed by the Secretary of State.

The amendments to this clause are tabled in the course of this House carrying out its function as a revising Chamber. I hope the Government will agree that their purposes are purely constructive. I hope they will be willing to accept them.

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