Public Bodies Bill [HL]

Lord Henley Excerpts

Wednesday 1st December 2010 Lords Chamber

Finally, I should also like to ask about the situation regarding this area in the devolved territories. Certainly, on the Welsh Assembly Government’s website there is still information about how to apply to agricultural dwelling house committees. It would be good to know from the Minister what consultations he has had with his counterparts in the devolved Administrations and whether they have raised some of the concerns about the way forward which have been raised today.

[The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Lord Henley)]

My Lords, in moving this amendment, my noble friend Lord Greaves said that this was his first amendment during what he described as a rapid canter through Committee on this Bill. I am not much of an equestrian, but “rapid” and “canter” are not the words that I would necessarily give to it at this stage. But I accept that my noble friend was merely putting forward a probing amendment. Therefore, I will try to set out why we think it is right that we are abolishing these committees.

As many noble Lords have said, ADHACs were set up under the Rent (Agriculture) Act 1976. The noble Lord, Lord Clark of Windermere, remembers the Act, as does my noble friend Lord Caithness. Sadly, I was not in the House, so I cannot go back quite that far. But I listened to both of them and they had rather different views. My noble friend made clear that ADHACs were set up to have an advisory role—I was very grateful he stressed that—in the rehousing of agricultural workers. To get on to the whole problem of accommodation in rural areas is stretching the point a bit too far. We are talking only about ADHACs and the advisory role that they had.

The purpose of the Act was to give those who lived in tied houses, such as agricultural workers, former workers and their successors, security of tenure and protection from eviction by their employer. Under the Act, a landlord can make an application to a local housing authority to rehouse a protected tenant on the grounds that the property is required for a new worker; that he is unable to provide suitable alternative accommodation for the existing tenant; and that the housing authority ought, in the interests of efficient agriculture, to provide suitable alternative accommodation. The landlord, the tenant or the local authority may refer such applications to the local ADHAC for advice on the agricultural need and the urgency of the application. However, there is no statutory requirement to consult an ADHAC. Again, I am grateful to my noble friend for stressing that point. Where advice is sought, the housing authority is currently obliged to take that advice into account when considering its housing priorities. But it is only a matter for the housing authority to take that advice into account.

Since the Rent (Agriculture) Act came into force, there have been significant changes to housing legislation, which have enabled farmers to let cottages to farm workers using an assured shorthold tenancy. As a result of these changes and changing employment practices within the farming industry, the use of ADHACs has fallen from what used to be something of the order of 500 cases per year in the 1980s to something fewer than 10 this year. To assist the noble Baroness with those figures, I can tell her that in 2007 there were nine cases, in 2008 there was a dramatic increase to 12, and in 2009 there were a further 12. So far we have had eight this year. As the noble Lord, Lord Whitty, put it, demand for this service is diminishing—and it is diminishing pretty fast.

In the light of this, the Government consider that, as the functions of the ADHACs are largely defunct, it is difficult to justify the retention of 17 different committees. Again, my noble friend referred to 16 different committees; I can assure him that there are 17 different committees covering England and Wales, with the associated administrative burden of recruitment and training of members. I appreciate that the cost is relatively low. The noble Baroness, Lady Quin, asked whether it was just £13,000. That is the figure I have for the direct administrative costs, but there will be other costs to the department in terms of the secretariat needed for 17 different committees in England and Wales.

Furthermore, it should be made clear that the function can be, and indeed is, carried out equally effectively by the local housing authorities on their own account, as my noble friend Lord Greaves seems to suggest. Many local authorities already take decisions on rehousing without the advice of an ADHAC. I can assure the Committee that the abolition of ADHACs will not remove any of the protection afforded to agricultural workers and their successors in tied housing. The only change will be when a local authority receives an application for rehousing a worker in a tied cottage; the local authority will need to determine the agricultural need and urgency of the application on its own account, as it does now in the vast majority of cases. Again, I stress, we have had eight uses of ADHACs in this year. I imagine, as we are already into December, that figure is unlikely to increase by that much.

There is no intention to change the provisions in the 1976 Act which give security of tenure to protected tenants; tenants will not be disadvantaged by the proposed abolition of ADHACs.

The noble Baroness, Lady Quin, asked about devolved Administrations—obviously in this case we are talking only about Wales, because this part covers only Wales. Yes, we will consult the Welsh Administration in the appropriate manner.

Finally, my noble friend Lord Caithness asked whether—or seemed to imply—we would need 17 different orders to abolish these. My understanding is that the power is such that there will be only one. I think that we—the noble Baroness as the opposition spokesman, and I as the Minister dealing with this in the Moses Room—will have to deal with only one rather than 17 different ones; I cannot remember whether the procedure is affirmative or negative. I hope with those reassurances my noble friend will feel able to withdraw his amendment.

[Lord Greaves]

My Lords, I am grateful to everybody for the constructive and consensual way in which the amendment has been discussed. The question of the number of individual cases per year has been raised. I am sorry if the figures I cited were rather larger than is actually the case. The figures came from what I took to be an official authoritative source on the internet, but perhaps that is a lesson for us all. I will go back and check that source, but that is clearly what it said.

A question of general interest was raised. I deliberately did not call the bodies “quangos”, for the very reasons that noble Lords mentioned; that is, that their scale and cost are small. In many ways, they strike me more as part of the big society than as quangos, but perhaps I should not pursue that very far. Perhaps there are parts of the big society which have performed a useful function in the past and are now redundant.

The Minister responded to my use of the phrase “rapid canter”. It is always a little dangerous to try to use irony in your Lordships' House, not least because Hansard has not yet got round to the use of smileys, which, as many of us know to our cost, are necessary if you are trying to say something ironic because a lot of people will otherwise read it absolutely flatly. I therefore make it quite clear that I was being absolutely ironic in talking about taking a rapid canter through the Bill, but—who knows?—it may be a rapid canter by the time we have finished.

I am very grateful for the Minister’s assurances that the legal protection for people who have tied tenancies will not change in any way. On that basis, and on the basis that I think that we have had the kind of discussion that I would have hoped for to make the position absolutely clear, I beg leave to withdraw the amendment.

--- Later in debate ---

In conclusion, I feel that this decision is a highly regrettable one if the Government decide to go ahead. It is not being done on grounds of cost but for political reasons. It is unjust, it is unfair, it does not make economic sense and it does not serve agriculture well. I hope that the Minister, in replying, will change tack and respond positively to the powerful concerns which have been expressed so well in this debate.

[Lord Henley]

My Lords, I will start, as is proper, by offering an apology to the noble Baroness, Lady Quin, for possibly misquoting her, as she alleged earlier in her somewhat lengthy speech. I am not sure whether I did, but I will look at the record and, if I have misquoted her, I will offer my sincere apologies for so doing. If I can quote her again, I noted that she made the point towards the end of her speech that there was possibly a case for strengthening the Agricultural Wages Board for England and Wales. I think that the noble Baroness accepts my quotation. I note that as a new commitment by the party opposite from its Front Bench.

The noble Lord, Lord Whitty, listened to his noble friend’s speech with great attention and I was grateful for his admission that the Government of which he was part had considered the abolition of the agricultural wages board. They decided not to for reasons that I cannot speculate on, but the range of speakers who come from the other side might give some indication as to why they changed their mind on the issue. We have examined the issue again and we have decided to go ahead with abolition. I will try to set out just why we wish to do that.

When the wages board and the committees were established in 1948—in fact, they were established earlier than that, but the parent Act is the 1948 one—farm workers had very little protection available to them from exploitation. The close working relationship between workers and employers, where the former were often dependent on the latter for housing, meant that workers were often at a disadvantage in negotiations on wages. In these circumstances, it was sensible to provide an independent statutory forum where farm workers and employers could come together to agree pay and conditions. Since that time, we have seen tremendous changes in wider employment legislation, both nationally and, as my noble friend Lord Caithness said, at an EU level, which protects and benefits workers in all sectors of the economy, including farm workers. Those changes include the introduction of legislation on the national minimum wage, which has been referred to. That makes it illegal to pay a worker below the current national minimum wage. There are also the working time regulations referred to by others, which, among other provisions, set a statutory minimum entitlement to a minimum wage.

For these reasons and all the changes that we have seen since 1924 and 1948, the agricultural minimum wage framework set out in that 1948 Act is, we believe, anachronistic. As the noble Baroness, Lady Prosser, and the noble Lord, Lord Clark, put it, in more or less the same words, life moves on. I accept that life moves on. Life has changed considerably since 1948 and it is no longer necessary to do what the Act does and effectively duplicate and gold-plate wider employment legislation. It adds an unnecessary regulatory burden for businesses in the agricultural and horticultural sectors, many of which are small businesses. It is a particular burden for farm businesses that also operate in sectors outside those covered by the agricultural wages legislation and hence have to cope with dual regimes. Moreover, the agricultural wages legislation effectively prevents the payment of annual salaries and fair piece rates, preventing farm businesses from adopting modern, flexible practices. That can also be disadvantageous to the workers.

I will say a word or two about Amendment 21, which would remove from the Bill the agricultural wages committees. Most of the functions of those committees, as my noble friend Lord Caithness made clear, have lapsed in practice or have been replaced by wider legislation. As my noble friend put it, there are currently 15 committees in England and one in Wales and their only remaining active functions are to appoint members of the agricultural dwelling house advisory committees and to report to the Secretary of State on their proceedings, which are now limited to holding an annual general meeting. I do not think that there is any case for retaining them.

It is for these reasons that we consider that the separate employment regime for agricultural workers is no longer appropriate. I am grateful again for the intervention from the noble Lord, Lord Cameron, who pointed out that he was not going to get away with paying the lower wages that seemed to be suggested by the party opposite. People just would not accept them. The same could be said for the intervention from my noble friend Lord Eccles when he pointed out that the whole industry has changed too much in terms of the sophistication of the skills that are required for many workers to confine themselves to pay rates of the sort that we are talking about. We believe that by abolishing the agricultural wages board—

[Lord Whitty]

Apologies if the Minister was moving on to this point, but do the Government have an impact assessment of the effect of the abolition of the legal minimum on wage rates, given that when each of the other wages boards was abolished the rate in that sector fell? Clearly, there are always some who are paid more than the minimum, but have the Government done that calculation? If so, I think that we should know.

[Lord Henley]

I do not think that it is necessary for that work to have been done. As I said, we believe that with the abolition of the board the industry will be able to operate more flexibly, which would lead to more job creation and better opportunities. What the noble Lord and others have been asking us to do is describe what picture, as they put it, we see for the future. I believe that it is one where it is open to the industry to come together to set up its own system. Again, I was grateful to the noble Lord, Lord Cameron, who said that the NFU ought to be out there seeking to put something together. What I did not hear from the representatives of Unite or Unite’s predecessor, the Transport and General Workers’ Union, was whether they were prepared to come together with the NFU and put something together. I do not see why the NFU, Unite and other industry representatives cannot come together and create their own advisory committee to discuss these matters. We do not think that it is necessarily a matter for the Government.

[Baroness Quin]

If I could follow up on my noble friend’s point, I thought that the Government had said that they would routinely carry out impact assessments in coming forward with legislation. I do not understand why they do not seem prepared to do so in this case.

[Lord Henley]

My Lords, as I made clear, I do not think that it is necessary in this case to carry out an impact assessment. If it was necessary, we would do so. What I am saying is that, after the abolition of the wages board, it is open to the industry to look at its own arrangements. That is why I was grateful for the intervention from the noble Lord, Lord Cameron, who said that the NFU could do this, but I do not see why the NFU cannot do it along with Unite and all the other representatives of the industry.

I appreciate that we have now spent an hour and a half discussing these matters. We will no doubt come back to this in due course. My noble friend Lord Maclennan said that there was still much time to discuss these matters. There certainly will be time, because noble Lords opposite wish to make sure that there is. We will discuss these matters further, therefore, but I have not heard anything yet this afternoon that would encourage me to say that there was a case for preserving the agricultural wages board or the agricultural wages committees. I hope, therefore, that my noble friend will feel able to withdraw his amendment.

[Lord Greaves]

My Lords, I thank everybody who has taken part in an excellent and sensibly tempered debate with a huge amount of expertise on an important issue. It is curious that we are having this kind of debate on the Public Bodies Bill, which is not, on the face of it, about agricultural wages or, indeed, about many of the other things that we will debate in the course of its consideration in Committee, except that it is about everything. It is a curious Bill about everything and nothing but, if it leads to debates like this, the Committee will be doing the Government a service as well as the country generally.

I was particularly taken by the range of expertise in the debate. I do not want to reply to everybody, because it would take far too long, but I was slightly amused by what the noble Baroness, Lady Prosser, said in her excellent contribution. It took me back to the great Liberal Governments of a hundred years ago, who had a great deal to do with the introduction of wages councils. However, times have changed and the solutions of a hundred years ago are not necessarily the solutions of today.

The noble Lord, Lord Whitty, is one of a large number of speakers with ministerial experience, particularly in this area, who are distinguished Members of the House. He referred to the possible involvement of the Low Pay Unit as part of the solution to this conundrum. I am aware that such discussions are taking place in some areas. Whether they will come to anything, I do not know, but at least there is some time to pursue them and other discussions in the mean time.

The noble Lord, Lord Cameron of Dillington, and the noble Duke, the Duke of Montrose, got me wondering about what I would do if I had my time again. I thought that I would perhaps have liked to have had a more outdoors life. If it were a choice of looking after sheep on a Scottish hillside or looking after the cattle of the noble Lord, Lord Cameron, there would be no real choice: I would spend my life on the noble Duke’s Scottish mountainside and probably enjoy myself more than I have done, although I have enjoyed a great deal, especially being able to stand and make speeches in your Lordships’ House.

The noble Viscount, Lord Eccles, raised an important question: do the Government have the facts about agricultural wages at the moment? How many agricultural workers are at the moment on the basic levels of pay set out by the agricultural wages board? I have not seen this information, but it must exist somewhere. How many of them are working for more enlightened employers, such as the noble Lord, Lord Cameron, or perhaps for employers who are exposed to a market that requires that they pay higher wages, or for a combination of both? We need that information before we can get to the bottom of how much the existing protection is required. Unite, among others, is saying that it has evidence of farmers telling their existing workers that if the protection is removed their wages will go down. I do not know whether this is tittle-tattle or hard evidence, but we need evidence to probe and investigate in the mean time.

Some noble Lords have argued that the legislation is not needed because they know of lots of people who are paid more than the level set out or, indeed, who employ people who are paid more than the level set out. I take that with a slight pinch of salt because you could apply that argument to the national minimum wage. Most people in this country are paid more than the national minimum wage, a lot of people are paid a great deal more than the national minimum wage and some people are paid astronomical sums—millions of pounds a year, according to what we read in the newspapers—but just because a lot of bankers are apparently paid these huge salaries is no argument for saying that the national minimum wage is not necessary or is not a good thing, because it protects a lot of other people who need protection. Again, I think that we need the kind of facts that the noble Viscount suggested that we should have. I hope that the Government will find it possible to dig out those facts, circulate them and write to all noble Lords who have taken part in today’s debate.

Having said that and having said what an excellent House of Lords debate this has been, with propositions made, questions asked and debates enjoined, I should add that the other part of the equation that is traditionally necessary in the House of Lords is for the Government to listen to what has been said, think about it and respond to it. I thought that I detected in the Minister some softening and some willingness to continue to take part in the debate. I hope that that is the case. He said that we will discuss these issues again further. I hope that he did not mean that we will have to wait until Report, when we can have a set-piece battle with everybody lining up with their pitchforks or whatever people use nowadays instead of pitchforks. I hope that the discussion will take place in the several weeks that will be available to us before we get to Report.

Let us keep talking and let us have further discussions wherever we can. Let us bring the matter back on Report if we need to, but in the mean time let us hope to find a way through the issues that have been raised today and find some sort of compromise. Let us distinguish between closing down a quango, which the Government are adamant they want to do, perhaps saving quite a bit of the £250,000-plus that it costs to run, and keeping at least some of the functions, which might be carried out by somebody else. Even if that is not possible, let us understand what kind of negotiating system and procedure there might be in future between employers and employees at a national level and what sort of guarantee there might be that that will result in solutions that will stick rather than advice that can be ignored.

There is a great deal to be discussed further. The burden to business is being exaggerated a little, but with reform, modernisation and streamlining of the system it might be possible to reduce quite a few of those burdens without taking away the essential safeguards of the floors that exist to protect a group of people who, as many noble Lords have said, are more vulnerable than many other groups nowadays. The world has changed, so let us change the systems in response to that without taking away what is valuable.

I think that there is a general view around the Committee that we should not divide on this occasion. Indeed, in view of what I have said, it would be totally inappropriate for me to ask for the opinion of the Committee at this stage. I therefore beg leave to withdraw the amendment.