Zero-hours Contracts

George Freeman Excerpts

Wednesday 16th October 2013 Commons Chamber

[George Freeman (Mid Norfolk) (Con)]

We all know that a job is the building block of a decent society and a decent economy, that the creation of jobs is the most urgent imperative that this economy faces at present, and that holding a job is the key to the dignity and respect that we want everyone to experience and that we want to spread to those who, sadly, have not experienced it to date. The appalling debt crisis that we face and the crisis in youth unemployment that we inherited from the previous Government make this mission more urgent and vital than ever. The creation of new jobs is, and should be, at the heart of the mission of this Parliament.

We all agree that long-term employment with a stable employer and the investment in training that goes with it is the model to which we aspire. Indeed, in most cases that is the model that prevails. The proudest achievement of my life before coming to Parliament was helping to create six new businesses that now employ more than 500 people in the life science sector. I agree with a number of my colleagues that the creation of jobs is one of the most important things we have done.

This crisis reminds us that the private sector is the only sustainable basis for the prosperity on which we all rely. It is the private sector that creates the tax revenues that fund schools, hospitals and the public sector, which employ others. One of the lessons of the past 14 years and the previous Government’s mismanagement of the economy must be to restore that truth and remind ourselves that private sector job growth and business growth are absolutely key to our prosperity.

We need to make it easier for youngsters in particular and others to get into work, and we need to encourage flexibility for the modern work force, including women, students and part-time workers. That is why I have recently called for a new deal for new business. Having worked in the creation of small businesses, I know at first hand how often the regulations and red tape that have been designed for, and often with, big business make it harder to create new businesses and new jobs.

Nobody wants to see exploitation. It may suit Opposition Members to claim that we are living in a dark age of Victorian exploitation, but that is not the picture that resonates—we are not. I welcome the fact that the Government have launched a consultation, and the Minister of State, Department for Business, Innovation and Skills, my right hon. Friend the Member for Sevenoaks (Michael Fallon), and his colleagues have been very clear that we want to stamp out abuse. My hon. Friend the Member for Braintree (Mr Newmark) intervened earlier to highlight the important difference between stamping out the abuse and exploitation of zero-hours contracts—which may well go on; indeed, I have no doubt it does in some cases—and saying that zero-hours contracts themselves are a bad thing and should be banned. I welcome the fact that the Minister himself is an ardent and passionate advocate of the importance of flexibility in the work force, and that he is bringing that zeal to the two Departments he represents in order to drive and support the Government’s growth agenda.

I say that for three principal reasons. We are living through a profound revolution in the world of work and in the economy. Call it the new economy or the innovation economy—the truth is that many more people in this country are now working in small businesses and are self-employed, and the projections for the next decade or two suggest that the numbers will grow. Small businesses and entrepreneurial, innovative businesses demand far greater flexibility than the bigger businesses that we have relied on in the past.

More women and students are coming into the work force. I recently visited the maths department of a university and during the break, there were 40 start-up companies in the foyer that were run not by graduates of the maths department, but by undergraduates. The students of today are entrepreneurial and are starting businesses. We need to embrace that new world. We can only trade our way out of the debt crisis. To do that, we must rediscover our buccaneering spirit of enterprise and entrepreneurship as we take on the global forces of competition. We will not succeed with a work force and a labour market that are shackled by the old ways.

My second reason for supporting the Government on this matter is that zero-hours contracts have received strong support from senior and respected voices in the worlds of business and human resources. The Chartered Institute of Personnel and Development has said that zero-hours contracts can benefit employees as well as employers. The Institute of Directors has referred to zero-hours contracts as a

“vital tool in our economic recovery”.

John Cridland has said that if we had not had zero-hours contracts,

“unemployment would have topped 3 million”.

My final reason for supporting what the Government are doing is that it is working. The Government’s labour market reforms have had a stunning impact on our rate of job creation. There are 872,000 more jobs in the economy than there were at the time of the last election. [Interruption.] Opposition Members are shaking their heads. They do not like it, but it is true. Some 1.4 million private sector jobs have been created since the last election. Three jobs have been created in the private sector for every one job that has been lost. This country is creating jobs at twice the rate of the United States of America—a market that we have traditionally looked at and envied its rate of job creation.

Let us stamp out exploitation. Let us criminalise the exploitation of zero-hours contracts where we can, but let us not shackle the flexibility that we need to create the new businesses and jobs on which we will all rely.