Deregulation Bill

Lord Cryer Excerpts

Wednesday 14th May 2014 Commons Chamber

[Toby Perkins]

I share my hon. Friend’s tremendous pride in the Act, and he is right to observe that very significant steps were taken in the 1970s. It should also be acknowledged that further steps were taken during the 13 years of Labour government through consultation and work with colleagues in Europe, and that Europe is a much safer workplace for it.

Back in 1993-94, 20 years ago, self-employed workers accounted for a sixth of all workplace deaths. In 2012-13, they accounted for a third of such deaths. In other words, the self-employed are twice as large a proportion of all those who die at work now as they were 20 years ago. If the Government are serious about driving down workplace deaths, reducing health and safety requirements for the self-employed seems a pretty odd way to start.

A few years ago funds for the Health and Safety Executive were cut by 35% in a single year, which has led to fewer inspections and the issuing of improvement notices. The present Government slowed the progress that we had been making on health and safety. However, we entirely reject the idea that the fact that Labour made that progress means that we favoured excessive regulation. Indeed, we are glad that the important work of the Better Regulation Commission—which was formed as part of the last Government’s commitment to deregulation, and which has played an important part in removing unnecessary burdens and ensuring that more are not unintentionally created when new regulations are introduced—has continued under the present Government.

The House of Commons Library estimates that businesses benefited to the tune of £3 billion a year as a result of the various deregulatory measures introduced by the last Government. A comparison between that scale of savings and this pygmy of a Bill sends a clear message about who was serious about backing business. However, a sensible approach to regulation is about proportionality, consistency and clarity, and I object in the strongest possible terms to the idea that making workers less safe or less well off is being done in the name of small businesses.

This Tory-led Government clearly have a view of the type of workplace that they want Britain to be. The Tory vision of the working Britain of the future is of a place in which everyone’s position and rights are insecure and enfeebled employees live in constant fear of losing their jobs, with low security, low wages and zero hours: an easy-in, easy-out workplace. The Tories think that a workplace that is engaged in a race to the bottom makes for a competitive economy.

[John Cryer (Leyton and Wanstead) (Lab)]

Is there not also a danger that if legislation removes health and safety cover from self-employed people, employers will have an incentive to give employees a bogus status of self-employment, regardless of whether that is appropriate?

[Toby Perkins]

A substantial part of my speech will deal with precisely that point, because I think it represents perhaps the most fundamental flaw in the Bill. When the Minister presented his idea, he was probably told that it was good news that authors would no longer be suing themselves because their chairs were the wrong height. However, the real impact of the Bill is exactly as my hon. Friend has described it.

When people ask the Government what they will do about zero hours and the exploitation of workers, the Government misunderstand the question. The easy sacking of workers and the reduction in their rights is not an accident of Tory policy; it is Tory policy. It is precisely what Tory Governments have always been about. Of course, this is not actually called a Tory Government, but it certainly feels pretty much like one. This is what Tory Governments have always done, and they should be honest about that, rather than claiming that they are acting in support of small businesses or in anyone else’s name.

I was a small business owner myself for five years before I entered Parliament, and I entirely reject the idea that impoverishing workers and stripping them of their rights was done in my name or at my request. That just shows how out of touch the Government are. It is very unfair of them to introduce measures such as this, and then claim that they are doing it in order to support small businesses. In fact, they are doing it because it is what Tory Governments always do.

As the Minister said, this idea originated in Professor Löfstedt’s report on health and safety regulations, which was published in 2011. We supported most of the report’s recommendations, but we think that the professor failed to understand the nature of the British labour market when he said that the rights of the self-employed in Britain were greater than those granted by some of our European competitors, and, in particular, failed to appreciate the huge growth in false self-employment in this country to which my hon. Friend the Member for Leyton and Wanstead (John Cryer) referred.

At the end of the last Government, the World Bank said that Britain was the easiest place in Europe in which to set up a new business. That is a key feature of our economy, and in itself it is something to be celebrated. Indeed, the idea that people should pluck up the courage to go it alone and start a new business, should challenge the established order and should find new ways of innovating and different ways of doing things—adopting the values and attributes of entrepreneurs—is very closely aligned with the history of the Labour party. Challenging the established order is precisely what the Labour party has always done. Of course we support people who want to set up their own businesses, but the healthy push towards starting up new firms that was established under Labour—with the spirit of adventure coursing through the veins, and ambition bursting through every pore—is very different from the growing move towards bogus or forced self-employment that we have seen under the present Government.

Unite has drawn attention to the fact that many workers in the care sector have been pushed into false self-employment, with the result that people on whom much of the fabric of a decent society depends can be sacked without warning, receive no holiday or sick pay, have reduced benefit entitlements, and are denied access to employment tribunals. They do not want to set up their own businesses or become entrepreneurial, but they are being told that the only way in which they can care for the old people for whom they have cared for so many years is to become self-employed. It is important to recognise the difference between those who want to be self-employed and those who are being forced into it.

--- Later in debate ---

[John McDonnell]

That worries me even more. I make this not as a party political point, but as a practical governmental point: that means that the legislation is a leap in the dark, before we know in any detail the consequences of what we are doing.

The Government have been looking at the matter for three years now. I met Lord—I have forgotten his name. He got the sack after having a few drinks too many at a reception. I met the original Lord who was consulting on this. He turned up with an individual who I thought was his butler. It was an adviser. He eventually got the push because he had a few drinks too many and said some unwise words. He was so impressive that I cannot remember his name. I met him three years ago when the measure was first mooted. We went through examples of what he thought was unnecessary health and safety legislation in certain areas. One of the areas he was looking at was shops, so I introduced him to the Bakers, Food and Allied Workers Union, which explained to him that health and safety matters were a worry in shops where its workers were.

From that original prejudicial approach, I thought the Government were going to lay out in detail how the duties would be implemented. To introduce the legislation without such detail in such an important area will render the legislation ineffective and put people at risk.

[John Cryer]

What my hon. Friend says about risk is right. In Committee, we asked time and again for a definitive list. The Government kept amending the list. I do not know which version we are on now, but we are almost at the end of the parliamentary process on the Bill, and the Government are now saying that they will consult. That should have been done right at the start of the process; if it had, we would now know what we were dealing with.

[John McDonnell]

There are times when one legislates on the principle and then rolls out the practical implications, but I agree with my hon. Friend that in this instance, because of the legislation’s significance and because the detail is so important to whether it is viable, in the three years when the consultation was supposed to be going on we could have drilled down into the detail and then come back with effective legislation, which would have achieved some element of consensus. Instead we have absolute confusion, and in health and safety matters that means risk. I will vote for the amendment, but I deeply regret the way in which the legislation has been brought forward. The risks that will be incurred will affect many of us, throughout all these different industries, but more broadly, as self-employment now grows, not only will self-employed workers be put at risk, but the general public as well. That is why the Minister needs to think again very seriously.

--- Later in debate ---

In a spirit of cross-party consensus, I call on the Minister to reflect on what has been said and to make the right choice in the interests of self-employed people, health and safety, and our wider economy.

[John Cryer]

My hon. Friends the Members for Derby North (Chris Williamson) and for Luton North (Kelvin Hopkins) and I served on the Committee, where this was one of the most controversial elements of the Bill. As my hon. Friend the Member for Hayes and Harlington (John McDonnell) said, the list has gone through all sorts of vexed changes and debates. In Committee, we were already on the third or fourth version. The sorts of questions he has asked today—“Why is this on the list?”, “Why is that not on the list?”—were being asked then.

[The Solicitor-General]

I fully accept what the hon. Gentleman says about the lively debate on this subject, but only one list was produced for Members, and it is the list that has been produced today.

[John Cryer]

If I am mistaken, I apologise. I remember seeing at least two versions, but perhaps I have got that slightly wrong. Nevertheless, there is still controversy over why certain occupations are on the list and others are left off. I am concerned that the Bill is nearing the end of its progress, yet nobody is quite sure what will be on the list and what will not. The Solicitor-General said in Committee that the Government would consult on the issue, but that should have been done some months ago. As my hon. Friend the Member for Hayes and Harlington has said, the discussions have been going on for about three years and it is only now that we are getting anywhere near some sort of public consultation.

[Toby Perkins]

It may well be that there was only one piece of paper, but in Committee it was as if there was an organic process by which the interpretation of the list and the meaning of the Bill changed in front of our very eyes. I am not entirely sure whether that is reflected on a piece of paper, but it was very clear that what it meant either was not entirely understood or that it changed as we sat in Committee.

[John Cryer]

Perhaps I am a victim of my own fevered imagination when it comes to the list, but I thought I remembered seeing different versions. My hon. Friend is right about the list.

[The Solicitor-General]

It may be that what the hon. Gentleman is remembering is the different approach taken by the Joint Committee. It came up with different proposals, to which the Government responded with the list.

[John Cryer]

Okay, I am prepared to accept that.

[Katy Clark (North Ayrshire and Arran) (Lab)]

Is the maritime sector on the list? I have been advised that it is not. Was there any discussion in Committee about whether the sector—ferries, ships and so on—should be on the list?

[John Cryer]

I am grateful to my hon. Friend for raising that point. I do not remember any specific discussion about whether maritime occupations should be on the list. Perhaps that was partly because we had a separate, lengthy and passionate discussion about maritime investigations. The RMT represents not all but most seafarers, and that discussion took place, oddly enough, just after it was announced that Bob Crow had passed away, and I think that added to the passion in the debate.

[John McDonnell]

There is a reason for the concern. It has been argued that there is not an awful lot of self-employment in the maritime sector, but there is. My hon. Friend knows as well as I do, because he was involved in this, the issues with the Thames cruises, where there is self-employment: individual families own their own boats and there is a licensing regime. Health and safety still needs to be applied to them, but they do not seem to be anywhere near the list.

[John Cryer]

I do not have the list in front of me, but I accept what my hon. Friend says. One of the things that has changed in the past few years—this has happened relatively recently—is that an awful lot of industries now have extensive groups of self-employed people. My hon. Friend mentioned that earlier in his career he worked for the National Union of Mineworkers. It is not particularly widely recognised that most miners—there are not many of them around nowadays, because successive Conservative Governments massacred the deep-mining industry—are self-employed or agency workers, and many of them are on virtually zero-hours contracts.

I think there is a view that anyone working at a deep mine in Hatfield or any of the others that still exist does so for an employer on a normal pay-as-you-earn basis. The reality is that most people who work in mines are self-employed in a very dangerous industry, and some of them—probably those who work on the surface, rather than those who work underground—will be removed from health and safety cover as a result of this Bill. At the very least, confusion will reign, because nobody is quite sure whom the Bill covers and whom it does not.

One of the many bases of this Bill is the idea that there is still a hard and fast division between those who are employed and those who are self-employed. That traditional view of the workplace was accurate 30, 40 or 50 years ago, but it does not apply now, because increasing numbers of people are self-employed and increasing numbers of people come under what Labour Members would call bogus self-employment. These are people who have been shifted to a self-employed status, sometimes against their will. There are examples of work forces who wake up one morning to discover that they are suddenly self-employed, having not been consulted. Before the Solicitor-General is moved to intervene, I know that that is illegal, but I think it is indicative of the world of work that we have today.

Disreputable employers already have several incentives for moving people to self-employed status, including the ability to abandon many of their normal responsibilities—the duty to pay national insurance, sick pay, holiday pay and so forth. More and more companies are now offering different routes for shifting work forces to self-employment. In Committee, I gave the example of the role of payroll companies, which go to normal construction companies—this happens a lot in construction—and say, “Give us your payroll responsibilities. We’ll look after paying the work force. We’ll shift them all to self-employed. As a result, you will escape responsibility for paying NI, holiday pay, sick pay and all the rest of it.” Another impetus is the fact that, because of the cuts to Her Majesty’s Revenue and Customs, it does far fewer compliance inspections than it did five or six—or even two—years ago. The idea that employers will be caught out shifting people to bogus self-employment by HMRC is less likely; it is more likely that they will get away with it.

The Bill provides another incentive to companies—not just those in construction, but in other industries as well—to move people to self-employment so that they can escape their responsibilities. If someone running a construction company who does not particularly care about his or her employees is told, “Well, if they’re not self-employed, they’re not covered by health and safety”, that is another incentive, encouragement or green light to employers to engage in such processes. Some of the processes are legal or on the fringe of legality, but many employers are still getting away with it. The irony is that many of the most dangerous industries, such as construction and agriculture, already have a very high level of self-employment. In some industries, we are moving to a position in which we are seeing the virtual abolition of regular full-time employment.

The TUC issued a briefing earlier today. Many Government Members think that the TUC is populated by blokes who are blood-soaked lefties and all about 8 ft tall, with biceps the size of Bournemouth.

[Kelvin Hopkins]

My hon. Friend the Member for Hayes and Harlington (John McDonnell) and I both worked at the TUC, and I do not think we fit that description.

[John Cryer]

I cannot imagine two more moderate figures in the House than my two hon. Friends. The reality is that the TUC is a very moderate organisation. When I worked as a political officer at Unite, I dealt extensively with it, particularly with the then general secretary, Brendan Barber. Whatever the views of Conservative Members, a person could not wish to meet a more moderate man—almost outrageously moderate—than Brendan Barber. His successor, Frances O’Grady, is a similarly moderate person.

The TUC briefing points out:

“The Bill states that the proposals are being done ‘for the reduction of burdens resulting from legislation for businesses or other organisations or for individuals’. In fact it does the opposite as it does not actually change the situation for those who genuinely do not pose a risk to others and only creates complete confusion for all the other self-employed.”

That very mildly and moderately expressed point of view raises the genuine concern that the provision will create confusion for an awful lot of the work force, many of whom work in some of the most dangerous sectors of the economy.

[Kelvin Hopkins]

It is a pleasure to speak in this important debate. I had the pleasure of working at the TUC for five years, during which the Health and Safety at Work etc. Act 1974 was brought in. There is no doubt that thousands of lives have been saved and thousands of injuries prevented as a result of that Act.

I remember that, as a student in the 1960s, I worked in the vacations. I think I am probably the oldest person here. [Interruption.] Well, yes, my hon. Friend the Member for Walsall North (Mr Winnick) is extremely old. In those days, we typically worked in factories during the holidays. I remember the horrendous lack of health and safety—unguarded machines, poisonous chemicals, no hard hats—but that was the life people led. I used to put the guards on the machines that I worked on. They were lying on the ground, but their use was not enforced.