David Anderson
Main Page: David Anderson (Labour - Blaydon)Enterprise and Regulatory Reform Bill
David Anderson Excerpts
Richard Fuller (Bedford) (Con)
As our national economy searches for growth, we look for direction. As our small businesses, our shopkeepers and our entrepreneurs struggle with unyielding burdens, they look for relief. As many who are unemployed, both short-term and long-term, continue their search for employment, they ask for hope. And so we turn for inspiration to the Enterprise and Regulatory Reform Bill. Here was our chance to send a clear message that we were going to roll back the European regulation that is calcifying the spirit of enterprise. Here was the opportunity to come forward with new ideas and initiatives for new funding sources to assist in dealing with the gap in funding for our small businesses. Here was an opportunity to press for changes in the jobs tax and to look for more tax deductions for people who wish to put their capital at risk in our small businesses. Here was an opportunity indeed to send a clear message to our local bureaucrats, with their pettifogging rules and regulations which are causing more misery to shopkeepers in our town centres, that they should stand back a bit and understand how hard it is in many town centres for small businesses to make progress. This Bill was the opportunity to address all those things, and I look forward to hearing in Committee how we have done on all of them.
I wish to address one part of the Bill, and it relates to what has been termed “hire and fire” and what has been termed “compensated no-fault dismissals”. I do this because I do not feel that Adrian Beecroft’s proposals have been given due consideration. There are strong arguments on both sides as to whether or not we should implement them, but we have not investigated the issues sufficiently carefully and it is wrong to dismiss the proposals with ridicule, with abuse or with fearmongering. Let me explain why that is.
If we look at the issues in developed economies, particularly those of the United Kingdom and the United States, relating to how we recover from recessions, we discover that our economies are finding it tougher to create jobs as we recover. In the period before the 1990s, it took on average about six months from the economy recovering for it to reach full employment. Since the 1990s, the figure has gone from an average of six months’ further delay to one of 15 months or more. The United States is a much better economy at recovering from recessions than the United Kingdom is. In the US, it takes on average four to five years for the economy to bounce back, but in the UK it takes eight to 10 years. There are therefore two strong reasons for examining why the UK is not as good at recovering employment as other countries are and why, even in those countries, it is becoming more difficult to associate growth with employment.
Mr David Anderson (Blaydon) (Lab)
Interestingly, the OECD has the UK as the second worst country out of 36 in the developed world for employment rights—only the US is worse—yet the record shows that countries such as Germany, with much better employment rights, have come out of recession faster. Is that not the lesson we should be learning tonight?
Richard Fuller
I appreciate the intervention, but I am not as clear as the hon. Gentleman is about those particular statistics and I am not sure that they paint the correct picture for the United Kingdom. The shadow Secretary of State cited the World Bank earlier when he looked at the overall statistics on doing business and said that they had—surprisingly—got better under the previous Government. If we look at the same World Bank statistics and the issues to do with the labour markets, we find that this country declined from 17th to 34th position in the period from 2007 to 2010. In terms of the need for change in the labour markets, it has been shown that we need to get a little better.
Mr Brian Binley (Northampton South) (Con)
I congratulate the hon. Member for Ayr, Carrick and Cumnock (Sandra Osborne) on a forceful defence of equalities. It was well received, and she should feel that she has done her job very well indeed.
This is an important Bill, and I will concentrate not on equalities but on small and medium-sized businesses. They are where our growth will come from, which is why we have to prioritise them. Over the past decade we have failed to recognise the contribution that new and growing businesses make to our prosperity. It is small businesses that deliver employment growth. Private sector employment increased by 45,000 in the final quarter of last year to 23 million, the bulk of whom are in small businesses. They represent more than half the people employed in this country. As the public sector contracts to sustainable levels the private sector will grow, and small and medium-sized businesses will create the jobs that we need. They need help and impetus, and that is what I want to concentrate on today.
The Secretary of State mentioned the situation in Germany, where very small businesses are well looked after because they are seen as the future oak forests of the German economy. They do not have to be on the trade register, they do not pay turnover tax, they do not specify turnover tax on their bills and they can calculate their profit for income tax purposes on the basis of revenue surplus. Additionally, they are not paid back the turnover tax that they pay to other businesses, and they are subject not to the rigid regulations of the commercial code but to the more protective regulations of the civil code. In other words, the Germans recognise the need to nurture their new and growing businesses. I am disappointed that we have not taken that route in the Bill, and I implore the Minister to consider that very seriously.
Much has been said in the debate about regulatory reform, but small businesses have heard much of it before. Large multinationals have the resources to use expensive consultants and employ compliance departments, unlike almost every small business that I deal with. In commensurate terms, the burden placed upon small businesses is sometimes 30 times greater than that on a plc, yet we expect them to deal with the problems of employment tribunals, health and safety at work and human resources. They simply cannot do that and grow at the same time, and we need a Government who recognise that. I recognise some of the good that the previous Government did in this area, but they did not really understand that point. I fear that we will not understand it either, and I beg the Minister to consider it very seriously indeed.
Mr Anderson
Given what the hon. Gentleman has said, would it not be more sensible for the Government, instead of attacking employee rights, to give small business people access to such things as good-quality legal aid, so that they can take people on and exploit the system in the right way?
Mr Binley
I consider the hon. Gentleman to be a friend, and our views meet on a number of issues, particularly clean coal. However, they do not meet on this matter, because his suggestion would only add even more bureaucracy to small businesses. We need to lift that bureaucracy, and I ask that that point be appreciated.
Mr David Anderson (Blaydon) (Lab)
Like everybody else in this Chamber, I represent a diverse community that is not just based on big businesses or the public sector but has very many small businesses. The issues that people from those businesses raise with me are not about employment rights but whether the banks are going to start lending some money so that they can afford to expand and take more people into the workplace.
My problem with the Bill as regards employment rights is that it is not based on evidence or need, or on great demand from the people of this country; rather, it is based on prejudice, opinion, conjecture and bias. It builds on the attacks that the workers of this country have already been suffering under the guise of deficit reduction. We have had mass unemployment, pay freezes, reductions in pension entitlements, and people being made to work longer for fewer benefits. Now, as a result of the Downing street double-dip recession, we are seeing another front opening up in the attacks on workers at home and at work. This is a hugely important matter for the people of this country, because these proposals will be seen by some employers—not all—as a right to exploit their employees.
None of this is new. The Conservatives have never supported positive rights for working people; they have spent the last two centuries attacking and undermining them. Even in the recent past, they were against the national minimum wage and, as we heard earlier, protections for agency workers. They were against the right to paid and increased holidays. Now, most of those rights that have been won for the most vulnerable and the worst-organised sectors of our society are under threat. On the last day before the recess, we saw the disgraceful slipping out of the information that the gangmasters legislation is to be watered down. What an atrocious thing to do; people must have no memory or no respect. These are basic rights in civilised nations, and they should be celebrated, not denigrated.
The Conservatives have shown their true colours with an anti-worker, anti-trade union agenda disguised as a means of promoting growth. I would say that, wouldn’t I? I have been a trade unionist for 44 years, and I admit to being biased, but it is not just me who is saying it. Listen to Mike Emmett of the Chartered Institute of Personnel and Development:
“If the Government is serious about stimulating economic growth, it will look to support employers’ efforts to build an engaged workforce. Taking away employment rights is not the answer.”
There is disagreement even within, although not at the heart of, Government. On 21 May, the Business Secretary said in The Sun:
“Some people think that if labour rights were stripped down to the most basic minimum, employers would start hiring and the economy would soar again. This is complete nonsense. British workers are an asset, not just a cost for company bosses. That is why I am opposed to the ideological zealots who want to encourage British firms to fire at will.”
So who wants it apart from the zealots in No. 10 and No. 11 Downing street? Well, Adrian Beecroft wants it—the man who gave the Tories half a million pounds. Give him his due: at least he is honest. He said:
“Some people would be dismissed simply because their employer did not like them. While this is sad…it is a price worth paying”.
Now where have we heard that before?
Ian Lavery
Does my hon. Friend share my experience of never having met an employer who believes that this Bill will be of any benefit to employees or to the economy as a whole?
Mr Anderson
It is clear from our discussions that nobody who represents employees believes that the Bill will improve growth. As was said earlier, the OECD has said that even though we have some of the weakest employment rights in the developed world, countries with more stringent rights are performing much better than we are. It is quite clear that it does not work.
Beecroft said that the consequences are a “price worth paying”, which of course is what the Prime Minister’s former boss, Norman Lamont, said in 1992—the last time there were 3 million people on the dole in this country. We have seen the truth. The Conservatives believe that mass unemployment is a tool of public policy. They believe that bosses should be able to fire people just because they do not like them. They believe that it is in the national interest for the work force to have to accept poor pay and insecurity at work, and to be made to work without the right to complain.
The legislation will be used to get rid of union representatives. It will be used to dilute the impact of health and safety representatives. It will be used to get rid of those who question authority. It will protect and promote the blue-eyed boys and girls who put up with anything without complaint and who do exactly what the boss wants, regardless of the consequences.
This is like a rerun of “Back to the Future”. The Secretary of State is Doc Brown, the well-meaning but hapless boffin. The Chancellor is Biff the bully, who will not let anyone get in his way. The workers of this country are playing Marty McFly, the poor guy who has to run to stand still, while all around him everything he has ever done is disappearing before his very eyes. Unfortunately, this is not “Back to the Future”, because that, as people know, had a happy ending.
A happy ending is possible only if one of the following things happens. First, the Government could see the error of their ways and pull back from these callous and calculated attacks on working men and women. Secondly, the yellow human shields of the Liberal Democrats in this House could finally get some bottle and give their Secretary of State the backbone to stand up for what he believes in. Having seen the attendance of the Liberal Democrats tonight, I guess that that is not going to happen. Thirdly, if the Bill goes through and workers’ rights are attacked, those on the Labour Front Bench must commit unequivocally to repeal the legislation at the first opportunity when we return to government. Anything less will be seen as a betrayal of the workers of this country and will not be easily forgiven or forgotten.
We should be focusing in this debate on how we can support businesses to hire more workers, not on how we can legislate to help the rotten ones to fire workers. This pathetic Bill says more about the nature of today’s Government than almost anything else that they have done and it must be resisted both inside and outside this House.