Gangmasters Licensing (Extension to Construction Industry) Bill

Debate between Ed Davey and David Hamilton

Friday 3rd December 2010 Commons Chamber

[The Parliamentary Under-Secretary of State for Business, Innovation and Skills (Mr Edward Davey)]

I congratulate the hon. Member for Midlothian (Mr Hamilton) on securing parliamentary time for his Bill. I recognise the depth of his interest in health and safety matters and in securing decent working conditions. Obviously he had a track record in this area before he came to this House, and it was a pleasure to meet him to discuss his Bill prior to today. I hope that I have a few things to say to him in the time that is left to me—

[Mr David Hamilton]

Sit down.

[Mr Davey]

The hon. Gentleman tempts me to sit down, but I will not be doing so quite yet because it is important to put the Government’s position on the record. I wish to say a few things that I think will have made his efforts worth while.

This Government, too, are committed to improving health and safety, particularly in construction, to ensuring fairness in the workplace and to encouraging and raising levels of compliance with workplace rights, in the construction sector and elsewhere. Where we differ with the hon. Gentleman is on whether licensing would be an effective solution to problems in the construction sector. Of course, licensing has its place as a tool in the regulatory arsenal. It is used in relation to labour providers in agriculture and food processing, as he said, and there are other examples too. However, licensing is an expensive and untargeted system of regulation. It burdens all with fees and inspections—the good and the bad alike—and with the risk that the worst businesses evade licensing altogether. Licensing can be an appropriate response to particular problems in particular sectors, but that does not mean it is appropriate in all cases.

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[Mr Davey]

I have considered all the issues that would have to be taken into account, such as whether it would be appropriate, proportionate and justifiable, and it is clear that the EAS does an extremely good job and that it deals with all the problems. Let me quote some of the statistics, which are worth bearing in mind. In 2009-10, there were 42 fatal injuries to workers in construction, with a fatal injury incidence rate of 2.2 per 100,000 workers per year. That compares with 105 deaths and a rate of 5.9 per 100,000 per year in 2000-01. Injury rates are also at an all-time low since the reporting regulations changed in 1995. That is done under the existing system. There has been some success and the previous Government should take credit for that.

It is clear that an extension of gangmaster licensing is not the way forward, but there is a case for taking a fresh look at our compliance and enforcement arrangements. As the hon. Member for Midlothian said, existing enforcement functions are undertaken by a number of bodies, including the EAS, HMRC, the GLA and the HSE. The Department for Environment, Food and Rural Affairs also has a role, in enforcing the agricultural minimum wage, but that will disappear with the proposed abolition of the Agricultural Wages Board as part of the public bodies review.

The single pay and work rights line has drawn those bodies closer together and has been a major step forward in creating a single port of call for workers who want advice or to report an abuse. It has also been a powerful spur to more joint working between the enforcement bodies, which are now carrying forward multi-issue cases together on a regular basis. However, the time is right to ask whether it is possible to build on the progress that has been made. I am therefore announcing today an intention to review the Government’s workplace rights compliance and enforcement arrangements to establish the scope for streamlining them and making them more effective. I hope that the hon. Gentleman will welcome that announcement. The review will be undertaken next year, when other priorities permit, and will be part of the wider rolling review of employment law being co-ordinated by my Department.

[Mr David Hamilton]

Who will undertake the review and who will be included in it?

[Mr Davey]

It will start in my Department and I envisage it looking at different ways of organising the Government’s compliance and enforcement work. It will consider whether incremental improvements can be made to encourage further co-ordination and joint working, such as better legal information sharing gateways and governance machinery, which would allow priorities to be discussed and set on a broader, cross-agency basis. I envisage it considering whether online and helpline employment law advice channels can be linked and streamlined. I also want it to look at the potential cost and operational benefits of enforcement models that would consolidate enforcement functions in a single body or fewer bodies.

The review will initially be carried out internally within the Government, as I said to the hon. Gentleman, but will involve meetings with key interested parties to solicit views and test thinking. My Department will publish a statement of initial findings and intended next steps next year in the context of progress reports on a wider employment law review—