Achieving Economic Growth

Debate between Baroness Laing of Elderslie and Mark Pawsey

Wednesday 18th May 2022 Commons Chamber

[Mark Pawsey (Rugby) (Con)]

It is a pleasure to follow the hon. Member for Norwich South (Clive Lewis), who addressed the topic of today’s debate, “Achieving economic growth”, by seeming to argue that economic growth is not only not important, but not desirable. I wonder therefore whether he will be having a word with his Front-Bench team, who seem to have spent most of the afternoon criticising the Government for not delivering sufficient economic growth, but that is a matter for him.

It is a pleasure to take part in today’s debate, to address the issue in question and to raise one or two points about the Queen’s Speech. Successful growth will be delivered through the effective role of the private sector. It is the private sector that is the wealth generator. I was delighted that the Chief Secretary accepted that reality in his opening remarks.

Both the economy generally and individual businesses face exceptional challenges, ones that have not been encountered for generations. Those challenges revolve around the recovery from the covid pandemic and, now, the need to address the issues arising from the conflict in Ukraine and its impact on energy prices.

I recently spent a really interesting lunch time with the Coventry and Warwickshire chamber of commerce. I expected those who attended to talk to me about supply chain problems and the challenges presented by inflation, but the biggest single issue they wanted to talk about was ensuring that they had a workforce with the right skills and the recruitment and retention of their staff. We have heard about jobs from many Members, not least my hon. Friend the Member for South West Bedfordshire (Andrew Selous), who spoke about the “jobs miracle”. The ONS tells us that unemployment is at its lowest since 1974 and job vacancies are at a record high of 1.295 million. In fact, we have more vacancies than people looking for work. The unemployment rate is now just 3.7%, which is the lowest rate for 50 years. The figures for my constituency tell exactly the same story, with unemployment falling and vacancies rising.

However, the current situation creates real challenges for businesses. As consumers, we recognise the effect of staff shortages: short-staffed businesses do not have the time to answer the phone or respond to inquiries, and there is a decline in service levels. Significantly for both businesses and the broader economy, opportunities are missed. In previous years, UK companies were able to look to eastern Europe to fill vacancies when they had staff and skills shortages, but that has become less of an option following our departure from the European Union. Businesses have raised with me the loss from the workforce of people in the 50 to 70 age demographic who either lost or left their jobs during the pandemic. The Government should focus on how we might get such experienced people back into the workforce.

There have been a lot of references in the debate to the ONS and its reports. Just a few months ago, in March 2022, the ONS published a report on its over-50s lifestyle study, which looked at the motivation of 50 to 70-year-olds who left employment during the pandemic. The ONS found that 77% of those aged 50 to 59 had left sooner than they had expected or intended to. It found that 19% had left because of stress or mental health, but that 58% would consider returning the workforce and 15% actively wanted to return. Were those people to return to the workforce, 36% of them would consider a flexible attitude to working to be most important, and 69% would want to work part time. It is important for the Government to consider ways to get such people back into the workforce, because they have valuable experience and can make a contribution. I saw an example of the people I am talking about in the volunteers I worked with on the delivery of the vaccine programme. Demand exists in the economy but it is not being fulfilled. We need to put the two things together.

In achieving economic growth, it is important for investors, customers, suppliers and the workforce to be able to understand the true state of a company. I note the Government’s interest in restoring trust in our audit and reporting systems through our corporate governance system. I am a member of the Business, Energy and Industrial Strategy Committee and we have looked at auditing, so I was disappointed to see that the audit reform Bill in the Queen’s Speech remains only in draft form. I want to see swift action to ensure that the full Bill comes to the House as promptly as possible. We know about the dominance of the big four, and we have had many reports and three independent reviews, as well as the work done by the Select Committee. I want the Government to make sure that a transparent and effective audit system is introduced. There are plenty of reports calling for change, and we have seen the events at Carillion, Patisserie Valerie, Thomas Cook, P&O Ferries and BHS. We need to rectify the situation, and I hope that the audit reform Bill is brought forward.

It is important to equalise growth across the country, and the levelling-up provisions are incredibly important in that regard. On the planning system, I want to ensure that an adequate supply of land is made available for businesses. That is an issue in my constituency. We are at the centre of England, making ours an ideal location for the logistics businesses that want to serve the country, but land is rapidly being taken up. I am concerned that, even now, many local councils have no up-to-date local plan, and instead rely on applications coming in and development control.

I note some of the provisions on local involvement, but the current neighbourhood plans are too bureaucratic and long-winded and take too long to implement. I note, too, the attempt to give people more involvement in planning issues and the principle of street referendums, but I am uneasy about those proposals as they may become a vehicle for disputes between neighbours. The Government may also have a real challenge in defining what constitutes a street.

Housing supply is a vital part of economic growth. Building homes is an economic activity, and of course new housing provides homes for workers, as my right hon. Friend the Member for Gainsborough (Sir Edward Leigh) reminded us a few moments ago. In my constituency, we have probably one of the best examples in the country of delivering new housing at volume through the development of Houlton, the sustainable urban extension to Rugby, which is being developed by Urban&Civic. That massive developer has great control over the activities of the house builders, and I believe that it is creating communities as well as building homes. It is vital that we provide the infrastructure first. In Rugby, we now have a link road to the main urban community, and both primary and secondary schools, but the challenge is to get the healthcare provision in place. There is a great deal of development in Rugby, and I am proud of what we have achieved.

I conclude by noting that there are many provisions in the Queen’s Speech that will support our businesses and enable growth and development to take place.

[Madam Deputy Speaker (Dame Eleanor Laing)]

Order. I hope that we can manage without a formal time limit, but that means that I must ask colleagues to stick to about six minutes. Six minutes and 20 seconds is okay, but eight minutes is not.

Employment and Trade Union Rights (Dismissal and Re-engagement) Bill

Debate between Baroness Laing of Elderslie and Mark Pawsey

Friday 22nd October 2021 Commons Chamber

[Madam Deputy Speaker (Dame Eleanor Laing)]

Order. I am sure the whole House joins me in congratulating the hon. Gentleman on his newly-born grandson, and sends its congratulations to our former colleague, his father, on being a great-grandfather. [Hon. Members: “Hear, hear.”]

[Mark Pawsey]

Thank you, Madam Deputy Speaker. Your remarks are most appreciated.

I want to participate in today’s debate for much the same reason as my hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake). I ran a business before coming here and I am also a member of the BEIS Committee, which considered the dispute between British Gas and the GMB union.

I want to start off by considering the term “fire and rehire”. I think the term “fire and rehire” is emotive. It has not been helpful in a number of instances of use in this debate, which has been fairly consensual. I have to say that I think the shadow Minister, the hon. Member for Bradford East (Imran Hussain), did not help the tone of today’s debate with his remarks. But there is an understanding that, where it is used as a negotiating tactic, fire and rehire is wrong and we do need to work hard to deal with that.

I want to look at the terms “dismissal” and “re-engagement”, because as an employer and someone who ran a business, the term “re-engagement” filled me with profound happiness: it was often a member of staff who had left my business and wanted to rejoin us, and often people who had gone away, broadened their experience and came back to our business with additional skills and additional knowledge. That was really quite encouraging and happened fairly often.

As an employer and a business owner, the term “dismissal” caused me a massive amount of grief. It was an issue we would never take lightly, but occasionally there would be a need to carry out dismissal on the basis of poor performance or unacceptable behaviour. But if ever my business went down that road, we knew that there were very strict rules of procedure laid down. We had to go through the correct processes, we had to be entirely sure of our facts and we had to build a case in the sure knowledge that that could be subject to a tribunal case and my business could be found to have behaved inappropriately or unfairly. I do think that, on occasions, the burden on business, and what it has to go through in the very sad cases in which that happens, is forgotten. I have to say that, at that time, the advice and guidance of ACAS in ensuring that my business behaved appropriately was incredibly helpful and very valuable.

[Mary Kelly Foy (City of Durham) (Lab)]

I would like to thank the hon. Member for highlighting the plight of those smaller businesses. Would he agree that Heathrow airport, British Airways, British Gas, Weetabix, Clarks, Argos and Sainsbury’s all are iconic British businesses? They have not engaged with their workforce, but they have engaged with that practice of fire and rehire. They are not struggling businesses. They are not just trying to get by. [Interruption.] They are not just trying to get by. They are powerful combinations—

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[Madam Deputy Speaker]

Order. I think we have got it—Mr Pawsey.

[Mark Pawsey]

I think I understand the point, and I think the hon. Lady, if she has been here throughout the debate, will understand that there is a desire from this side for that not to happen, and for discussions and negotiations to take place at a much earlier stage.

We have had reference to the ACAS paper that was published in June 2021, which of course makes interesting reading. It tells us that dismissal and re-engagement is not new and has been around for some time, and it sets out the scenarios where it has been applied. Those of course include the harmonising of terms and conditions. There are many businesses that make acquisitions and find that they have staff on different terms from businesses that have come together over a number of years, and it is not appropriate for one set of employees in a business to be operating on different terms and conditions from those elsewhere in the business. There is a prima facie case, an immediate case, for why there should be some standardisation. During the pandemic, businesses have been required to introduce temporary or permanent flexibility in respect of hours worked, shift patterns and the security of hours. Covid has substantially affected—

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[Madam Deputy Speaker (Dame Eleanor Laing)]

I thank the hon. Gentleman for his very reasonable point of order. He has asked a question to which I cannot give him a direct answer, because I do not know the answer, but I would say to him that it is of course not a matter for the Chair. It is, however, a matter for the House authorities. When I say it is not a matter for the Chair, I do not mean to imply that it is a matter about which the Chair is unconcerned. I will therefore endeavour to find out the answer to his question and let him know as soon as I possibly can.

[Mark Pawsey]

I was in the process of setting out the scenarios identified by ACAS in its paper of June 2021 on where dismissal and reinstatement had been used. The final point, which has been made by Conservative Members in particular, is the challenge of business survival in the current circumstances, with covid, and the need for businesses to get through an incredibly difficult time.

The ACAS paper also identified a number of differing attitudes to the reasonableness of using dismissal and reinstatement in dealing with one of those scenarios. It set out a series of positions, including, at the very top, the view that this should never be used. Before arriving in the Chamber this morning, I believed that that was the attitude of the Member promoting the Bill; I believed that he would never permit dismissal and reinstatement to take place. However, he told us today that in certain circumstances it can exist and that he is seeking not to ban it but to ensure that it is never needed to be used. I am sure that a number of his Opposition colleagues do not agree with that approach and would be in the “never” camp. Others see it as being a matter of concern when it is a negotiation tactic, which I think is a view common on this side of the House. There are those who see it as an option of genuine last resort, a view again sympathetically understood by those on this side. Others think it is not at all contentious—I do not think that anybody here believes that—and there are some who believe it is perfectly acceptable at any time, and the House has made its view clear on that.

I now wish to turn to the issue of Centrica, because the Select Committee on Business, Energy and Industrial Strategy looked at that. We heard in Centrica’s evidence to the Committee that the costs of its services were between 30% and 50% more expensive than the use of contractors. The senior management had real concerns about the viability of their business ongoing. They sought less to deal with the issue of pay, but more to deal with the number of hours on a standard contract. They wanted to increase that from 37 to 40 hours. Indeed, in their restructuring 20% of their staff would receive a pay rise. One thing that the chief executive reminded us of in his evidence was the need for businesses to keep sight of what the customer wants and what their needs are. Those of us who have been in business will know that the customer is king and that those of us who disregard the needs of our customers put their businesses at a significant disadvantage. Where businesses are uncompetitive, it is important to deal with these things at an early stage, because otherwise, as we know, the danger is of long-term redundancies and business failures, which are not in the interests of anybody.