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Lord Tebbit moved Amendment No. 290:

Page 13, line 43, at end insert--
("( ) For the purposes of this section, "employees' representative" or "employers' representative" shall not include any trade union, trade association or political party.")

The noble Lord said: I hope I shall not detain the Committee long with these amendments. I should like to explain, lest it be not clear, the purpose of the amendments. Amendment No. 290 would provide that neither trades unions nor employers' organisations should qualify to receive moneys under this part of the Bill. Amendment No. 291 would limit expenditure to £100,000 per year except by the consent of Parliament. I notice that it has been announced by the Secretary of State that the sum of £5 million is to be made available in total.

Amendment No. 292 would require recipients to provide proper accounts of how any money which they had received had been spent. Amendment No. 293

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would require the Secretary of State to report to Parliament on the use of the money and who had received it.

For much of today we have been appealing to what one might describe as the industrialist and employers' wing of New Labour to ask them to consider some of these amendments in the light of their own experience as employers and industrialists. I think that these amendments appeal to what one would call "the Treasury wing" in that they are primarily concerned with the proper use and accountability of public money.

It seems to me that "partnerships" is the in-word for what we are dealing with in much of the Bill, particularly in relation to these amendments. However, "partnership" does not have the meaning we normally give the word. It does not mean an arrangement in which people come together and share joint responsibility for the costs involved and the consequences of what is agreed.

These partnerships are ones which would put legal obligations not upon trades unions but only upon employers, and by statute rather than agreement. So, "partnership" is the wrong word. We are talking about contractual undertakings which are binding as usual in this world of industrial relations upon only one side.

Nonetheless we have to face the size of the Government's majority and the reality of it. However, I would state in passing that New Labour really does seem to have made some changes in this world. In the days of Old Labour it was Conservatives who lost amendments during Ascot week. Now it appears that it is New Labour who cannot maintain a House in a majority during Ascot week. That is probably welcome. It shows a degree of social change which I am sure we would all welcome. However, I think we will be lucky not to have some of these amendments turned over again in the other place after Ascot week.

We have to try to take Ministers at their word, that the Bill is designed to lower costs, reduce regulation and make industry and commerce more competitive. In the press release issued by the DTI on 24th May (P/99/438), I notice the words:

    "Light touch regulation will help partnerships,--Byers". It goes on to explain--I think we will all smile at this:

    "That is why, in implementing our plans, we shall introduce light-touch regulation to enforce the entitlements we are providing". It is a light touch of enforcement, but enforcement nonetheless. It continues:

    "Instead of detailed and prescriptive regulation"-- I thought we had quite a lot of detailed and prescriptive regulation here in the Bill this evening--

    "we shall look for agreement achieved through a genuine partnership". So it continues. But, if public money is to be handed out, we have a duty to see that it is used properly, for the purposes which Parliament intended, and that it is properly accounted for. Hence these amendments.

I notice in the same press release in the Notes for Editors that the point is made that the matching funds of at least 50 per cent from non-public sector sources will be required for successful projects. I believe they

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mean for successful applications to finance a project rather than for successful projects. The noble Lord, Lord McIntosh, shakes his head, but I like press releases to say what they mean and not confuse matters.

We have to ask ourselves why that is a requirement. The requirement is there essentially to ensure that there is additionality; that this money does not come 100 per cent from public sources, but that we expect other sources of finance will be perhaps from employers, trade unions, in some circumstances perhaps from academic institutions or the like. If that is so, then we have to ask why it should go to organisations which are essentially rich. On the whole, the employers likely to seek this money will be organisations which, if they thought the project was worthwhile, would finance it themselves. Certainly the same is true of trade unions, which are, in general terms, also rich.

I might say in passing that I hope the Minister, when he responds to this debate, will tell us a little more about the restriction that the money should come from non-public sector sources. Does that exclude money from a public sector employer such as, for example, London Transport--while it remains in the public sector, which I understand may not be for much longer? We still have some nationalised industries about, though probably not for much longer. Will they be regarded as employers, or will they be regarded as public sector financiers in the terms of this Bill? If we are to seek additionality, then we should not give this money to rich organisations.

I note also from the Notes to Editors--it is an intriguing press release in that the most interesting bits are the Notes to Editors and not what the Minister actually said--that the point is made that in order to demonstrate additionality it has to be established that these projects would not go ahead or would go ahead more slowly on a smaller scale without support from the fund.

There is also an interesting section under the heading, "How will bids be assessed?". There are some sensible points made in that regard, but there is nothing in the press release as to how they will be reviewed; how it will be decided whether or not they have been successful and what lessons should be drawn. If we are to be able to assess whether or not these projects have been successful in their use of public money, the key elements are that proper accounts should be kept; that those accounts should in some way be presented to Parliament; and that at all times we should restrict the amount of money until we are sure that the projects are having the effects which were intended. To that extent these amendments are not intended to obstruct the purpose of the Bill, but rather to reinforce it. I hope they will be viewed in that light. I beg to move.

Lord McCarthy: While I support much of what was said by the noble Lord, Lord Tebbit, my main problem--I am sure he will agree that we take this series of proposals as one--relates to Amendment No. 290 which affects Amendment No. 261. I understand the noble Lord is not against giving employers money, or

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employees. In fact, he would not have tabled the amendment if the clause had read:

    "The Secretary of State may spend money or provide money to other persons for the purpose of encouraging and helping employers ... and employees ... to improve the way they work together". He simply does not want to give money to "their representatives". He has not explained why that should be. Managers, after all, are the representatives of employers. He is saying he does not mind giving money to Rupert Murdoch, but not to his managers. The case with trade unions is different: representatives need not be employees, but they might very well be. He is saying that you cannot give money to lay representatives who are employees. It is an odd breakdown.

It all turns on one's view of partnership. If the noble Lord thinks that it has a representative element, or if he thinks it is about collective bargaining, which I know he does not like to think about and certainly not this late at night, or if he is thinking about representing the views of Rupert Murdoch and the views of the union membership collectively, then these people would be required. However, I cannot go along with this rather strange amendment.

Lord Tebbit: Perhaps I can help the noble Lord. I would not be particularly anxious for Rupert Murdoch to be the personal beneficiary of this money. It would probably be quite difficult to demonstrate additionality, even in the sum of £5 million in his case. I would object if it were to go to the newspaper proprietors' association, the collective of newspaper proprietors.

I have no worries about the money going to organisations of workers, as long as they do not fulfil the function of a trade union which, to my mind, is a similar function to that fulfilled by collectives of employers, for example the Engineering Employers' Federation. I do not object to the money going to organisations of workers, but it should not go to wealthy collectives.

Lord McIntosh of Haringey: I always enjoy listening to the noble Lord, Lord Tebbit, in his jocular mood. He enjoys taking this kind of stance in the House. Then, when you read what he says in the News of the World on Sunday, you realise that behind his remarks is seething indignation against all the things that he is prepared to laugh about when he is in your Lordships' Chamber.

The noble Lord has done his homework. He has read the press release and the note to editors issued on 24th May when the Prime Minister and the Secretary of State for Trade an Industry spoke at the TUC partnership conference. I suspect, knowing him, that he has probably done his homework and read the speeches as well, but I doubt whether he has really understood what is behind the partnership fund that is set up by Clause 26.

As I said at Second Reading, we do not need statutory authority for this partnership fund because the £5 million is being found from DTI resources and it can be spent at executive discretion, subject to scrutiny by Parliament in the normal way, particularly by Select Committees and the National Audit Office. However,

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we have chosen not to do that; we have chosen to seek statutory authority for it because we believe that the partnership principle pervades this legislation. I do not expect the noble Lord to agree with me. He is deeply cynical about these things and, with his history, I can understand it.

We wanted to show that not only were we prepared to put legislative provisions in the Bill to encourage partnership by making sure that neither one side nor the other could indulge in exploitation, but that we were positively encouraging partnership by putting a small amount of taxpayers' money, not government money, to encourage partnership schemes and initiatives in order to progress the thinking of the Government and, in general, the employers and trade unions. The noble Lord seems to think that this research fund would impose legal obligations on employers only and that it would produce statutory results. That is not the way I see it; indeed, it is not the way the Prime Minister or the Secretary of State saw it. We are using a statutory method for declaratory purposes, if you like, to do something which is certainly non-statutory and which would, in our view, contribute to the cause of partnership in industry.

I do not need to repeat what the Secretary of State and the Prime Minister have said or what the noble Lord, Lord Tebbit, repeated to the Committee. He has rightly said that there is a fund of £5 million over five years; that there is a limit of £50,000 on any one project; and that 50 per cent matching funding is required for any one project. He also rightly advocated proper financial scrutiny and control over any expenditure under this heading.

I turn now to deal with the noble Lord's amendments. The partnership fund which we intend to set up under this authority will be designed to promote new partnerships at work and develop a new non- confrontational approach to employment relations. Amendment No. 290 would exclude trade unions and trade associations. The amendment refers to trade associations, but the noble Lord referred to employer organisations. I take it that there is no difference in his mind in that respect, although there is in mine. That would completely undermine the purpose. If you cannot have employers involved in these projects and if you cannot have organised employees involved in them, who is left? Who will actually be involved?

The amendment also refers to political parties. Of course, there is no question of providing funding for political parties or for anyone else for political purposes. Amendment No. 291 would restrict the funding to £100,000 a year without a resolution of both Houses. Parliament is already burdened with secondary legislation requiring either negative or affirmative approval. Therefore, we would be seeking parliamentary authority for relatively small amounts of money.

The sum of £5 million has been allocated from within the existing budget of the Department of Trade and Industry. It is an appropriate sum of money which will ensure that the fund can make a real contribution to developing partnerships based on employment relations in the United Kingdom. We will of course be putting

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into place clear rules and criteria governing the operation of the fund in order to ensure value for money. Recipients of funding will be required to demonstrate that their project offers value for money. The department will monitor and evaluate all funded projects. That does not just mean monitoring them as they proceed but evaluating whether they have achieved their objectives--a very proper consideration and one to which the noble Lord referred.

The department will also require recipients of funding to provide all the information necessary. Any scheme that is set up will have terms and conditions attached to any offer of grant, which will include the requirement to provide all appropriate monitoring and financial information. Requiring this information to be audited in every case by an external accountant qualified to do so, pursuant to the Companies Act 1985, as required by the amendment, would be disproportionate and burdensome.

The proposal for a new subsection (5) is disproportionate. The offer of any grant under the partnership fund will include standard procedures for ceasing to pay and for clawing back the money if conditions have been breached or if it has been used in contravention of the conditions of the programme. We will ensure that there is full financial accountability in the case of the partnership fund and any subsequent programmes. The department publishes each year its expenditure in its expenditure plans report. An annual report will also be published in respect of the partnership fund. I can assure the noble Lord that that will include the results of monitoring and evaluation.

There is no reason to include a provision for an annual report and, as I have indicated, there is no reason to impose the particular restrictions on the fund which these four amendments would introduce. However, I understand that the noble Lord's objection to the fund is much more fundamental. As far as he is concerned, it is an issue of confidence. I do not hope to gain his confidence but I hope to gain his recognition that his amendments are undesirable.

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