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Ms. Mowlam : I thank my hon. Friend for pointing that out. As I am sure he is aware, the narrowness of it was dealt with in last week's debate on the single market and financial services. Opposition Members complained bitterly that, whether it be this European company statute, the usage directive, the second banking or the capital adequacy directive--whatever the Government are bringing forward--they do not bring forward a consumers' directive. That has been discussed in the European Parliament and in the Commission. The Commission thinks that the earliest date that a consumers' directive will be in operation is 1991, when many other directives and draft instruments will be in place. I thank my hon. Friend for that intervention. In the narrow definition on the Order Paper today, even the rights of consumers are not taken into account in any meaningful way by the Government.

I do not wish to try your patience, Mr. Deputy Speaker, but, as the debate started six hours ago, it is essential to point out that my hon. Friend the Member for Linlithgow (Mr. Dalyell) mentioned two named individuals. I do not know exactly what he was referring to, but it is clear that hon. Members would regard with dismay and worry the programme on Cambodia. If the Minister sees his way clear to writing the letter for which my hon. Friend asked, Opposition Front-Bench Members would appreciate a copy.

My penultimate point is-- [Interruption.] The Parliamentary Under- Secretary of State for Employment might find this debate ridiculous. I am sorry that he does. The debate began earlier this evening. Opposition Members were quite happy to discuss the matter at a sensible hour this evening. Conservative Members caused hon. Members to return to discuss it at 2.19 in the morning. Like him, I should like to be tucked up in bed

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-- [Interruption.] Yes, I do have certain standards--but Opposition Members are not responsible for the timing of this debate. We had a good discussion earlier in which the Minister asked directly whether the Opposition were asking for a European company law. I said that that was not the essential point and that we should have liked different negotiations which would lead to a different point. However, when I thought about this over dinner, I realised that the takeover directive is, in fact, European law on the statute book, and that it has not negated national law. The two do not have to work in opposition- -they can work in parallel. National company law has not been devalued or replaced by European company law. The two systems can work in parallel and need not add to overcumbersome legislation.

My hon. Friend the Member for Bradford, South has outlined his clear desire to see the implementation of the worker participation section of the European company statute. He said that it is essential that progress is made at a national level and that the United Kingdom should take the lead in Europe. It is important to add that, again, the two need not work in opposition ; they can work in parallel. We should push hard--a Labour Government would do so--for legally enforceable workers' rights, for rights to which everybody should be entitled, but that does not mean that we should not push the present Government towards making changes in Europe and within the existing legislation.

Mr. Allen McKay (Barnsley, West and Penistone) : I am grateful to my hon. Friend for giving way on that point because I had intended to raise it. I am sure that she will recall that lead used to be used at a workplace in my constituency, but is no longer. I know that she will also recall the fact that the fault lies entirely--or rather mainly--with the Health and Safety Executive. If trade union rights had been adhered to in that place and if there had been worker participation, three of my constituents would not have ended up in hospital with lead poisoning.

Ms. Mowlam : I thank my hon. Friend for that intervention, which fits into much of our discussions earlier this evening. If we have such difficulties on a national level although we have legislation to protect workers' rights, what about the problems that we face when trying to get retribution or a response when there is an accident in France involving a company that is based in Germany, with British workers? Without a proper legal framework to protect workers, we shall be in an untenable position.

The European company statute had been discussed in detail in the European Parliament where much more time was spent on it than we have been able to spend today. A reading of the proceedings of the debate in the European Parliament shows clearly that all other countries voted with a large majority in support of the statute. The vote was 175 to 23 in favour, with two abstentions. That shows the support for the statute in the rest of Europe.

I refer now to two or three of the points that were made in the European Parliament in support of the statute. Stress was placed on the close links between the industrial and social aspects. The structuring of the European company is regarded as an opportunity to give concrete form to the social dimension of the internal market--

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Mr. Ivan Lawrence (Burton) : The hon. Lady said that hours ago.

Ms. Mowlam : The hon. and learned Gentleman may remember much of what I said earlier, but I did not talk then about the social dimension of the internal market, and I did not--as I am about to do--mention the difficulties that the Government now face, driven as they are by an ideology that hypnotises them not to see the parallel between the social and industrial dimensions. It is when those two work in unison, which Labour Members and members of other parties in the European Parliament are keen to see happen, that a European company statute will have a meaningful impact for society as a whole. I inform the hon. and learned Member for Burton (Mr. Lawrence) that I did not make that point earlier.

Some other points were made in the European Parliament in support of the European company statute. Labour Members regard the statute as fine in principle but would like to see some changes. Members of the European Parliament see the social dimension as a fundamental component of the internal market, not as a mere adjunct to it. It will be indispensable. We have argued that on numerous pieces of European legislation in the House. We are worried, as with the European company statute, about the distinction between a directive and a regulation. We are fearful that the regulation may go through but that the directive on worker participation will lie on the table and will not be implemented at the same time. That anxiety was expressed clearly by many Members of the European Parliament. Labour Members believe that we are in danger of seeing that fear realised, due to the Government's intransigence in Europe over many years of discussions.

The debate in the European Parliament emphasised clearly that there were several options for worker participation in the European company statute. Many speakers expected it to be incumbent on the management and staff of any undertaking to reach agreement on the model of worker participation to be adopted. They also expected that no European company would not apply any model of worker participation. That has been the crux of our argument on this part of the European company statute. There are three options. Flexibility is built into the statue. By default there could be a reversion to the national option. A European company could negotiate an agreed option beween management and workers in a particular European company. We believe that that would give enough flexibility. The Minister said that that would have to be in the statutory framework. Yes, and a good thing too, because without such legal protection and unless the general principle is agreed, workers' rights will not be protected. We clearly understand that the detail would have to vary from company to company, country to country and circumstance to circumstance. We readily accept that. We want to see established the principle that it is a legal right of every worker to be provided with information and to be consulted. It is clear that the Government are not only out of date and out of time with British companies, but out of step with the attitude in the rest of Europe.

The European company statute clearly shows that Labour Members are in tune with the rest of Europe. For the Minister, Europe stops at Eastbourne or perhaps the Channel islands, with their offshore implications. For the Prime Minister it is probably the Isle of Wight. We see the need for a European company statute. We happily agree

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with the Minister that it may not be used much in the early years. It may not be used without some changes to remedy the confusion that exists in parts of it. We readily acknowledge that. If the regulation is not accepted, the next Labour Government will negotiate that detail carefully. But we shall be sure that the worker participation element is included. We believe that that element is the main reason why the Government have blocked the directive.

2.28 am

The Parliamentary Under-Secretary of State for Corporate Affairs (Mr. John Redwood) : The hon. Member for Bradford, South (Mr. Cryer)raised an important point about insolvency and re-formation of companies through their directors. That matter is covered in sections 1(15) to (23) of the draft. We agree with the hon. Gentleman that they are not satisfactory, particularly in relation to national law. It is an area of company law provisions which we shall look at carefully to make sure that there is a satisfactory means for winding up and at least similar precautions and protections to those in current United Kingdom insolvency law.

I agree with the general line taken by my hon. Friend the Member for Winchester (Mr. Browne). I thank my hon. Friend the Member for Richmond and Barnes (Mr. Hanley) for his many good points on company law and accountancy problems, several of which will be taken up by the Government in forthcoming negotiations. I agree with my hon. Friend the Member for Chichester (Mr. Nelson) that the Government wish to encourage on a voluntary basis the many good models of employee share participation and employee participation in general. Britain has much to be proud of, because in recent years many good models have been developed and many schemes pioneered. As my hon. Friend said, the National Freight Consortium is seen by people all over the world as an example of great success.

The hon. Member for Linlithgow (Mr. Dalyell) raised a series of issues that are the responsibility of my hon. Friend the Minister for Trade. I am sorry he is not in the Chamber but I think that the hon. Member for Linlithgow is in touch with my hon. Friend who, I am sure, will read the report of the debate and will contact the hon. Gentleman if he has helpful information.

I should like to rebut three points made by the hon. Member for Redcar (Ms. Mowlam). She said that the Government's position was not clear, but that is far from the case. I made our position quite clear in the debate and it is set out in the explanatory memorandum. I like to hear the views of the House and have noted several useful comments which we shall follow up in the negotiations.

The Government are against several elements in the current proposal. We oppose some of the company law proposals, the taxation proposal, the voting base of the measure and the particular forms of mandatory worker participation in the directive. However, it is not true to say that we are against a particular style of worker participation or against employee participation in general because, as I made clear in the debate, we are against a certain kind of mandatory worker participation.

Secondly, Labour still refuses to come clean on whether it would negotiate a comprehensive framework of European law that would deal with the problems of 12 different types of company. I do not know whether the

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Opposition cannot say or will not say, but it seems that they have no idea of their policy on the relationship between European and national company law. It is a great pity that they cannot clarify this crucial issue.

The hon. Member for Redcar tried to claim that if a Labour Government were handling these negotiations and had in front of them a more general proposal for a European company statute, they would make rapid progress. The hon. Lady says that that we are unable to do that. When Labour were in government for five years from 1974 until 1979 there was a more general proposition on the table and not an inch of progress was made. That shows that the realism of office made Labour realise that there are all sorts of company law problems in the proposals. I am glad that Labour will not have the chance to find that out again.

Question put :--

The House divided : Ayes 63, Noes 4.

Division No. 330] [2.32 am

AYES

Amess, David

Arbuthnot, James

Arnold, Jacques (Gravesham)

Baker, Nicholas (Dorset N)

Bennett, Nicholas (Pembroke)

Bevan, David Gilroy

Boswell, Tim

Brazier, Julian

Browne, John (Winchester)

Burns, Simon

Burt, Alistair

Butcher, John

Carrington, Matthew

Chapman, Sydney

Chope, Christopher

Clark, Hon Alan (Plym'th S'n)

Conway, Derek

Coombs, Simon (Swindon)

Day, Stephen

Devlin, Tim

Fallon, Michael

Forth, Eric

Freeman, Roger

Gale, Roger

Glyn, Dr Sir Alan

Goodlad, Alastair

Hague, William

Holt, Richard

Howarth, G. (Cannock & B'wd)

Jackson, Robert

Kirkhope, Timothy

Lawrence, Ivan

Lightbown, David

Lyell, Rt Hon Sir Nicholas

Maclean, David

McLoughlin, Patrick

Malins, Humfrey

Mans, Keith

Mitchell, Andrew (Gedling)

Moynihan, Hon Colin

Page, Richard

Paice, James

Patnick, Irvine

Portillo, Michael

Redwood, John

Renton, Rt Hon Tim

Ryder, Richard

Sackville, Hon Tom

Shaw, David (Dover)

Spicer, Sir Jim (Dorset W)

Stern, Michael

Stevens, Lewis

Stewart, Andy (Sherwood)

Summerson, Hugo

Taylor, Ian (Esher)

Taylor, John M (Solihull)

Thompson, D. (Calder Valley)

Twinn, Dr Ian

Waller, Gary

Widdecombe, Ann

Wood, Timothy

Yeo, Tim

Young, Sir George (Acton)

Tellers for the Ayes :

Mr. Greg Knight and

Mr. Neil Hamilton.

NOES

Barnes, Harry (Derbyshire NE)

McAllion, John

McKay, Allen (Barnsley West)

Skinner, Dennis

Tellers for the Noes :

Mr. Bob Cryer and

Mr. Ian McCartney.

Question accordingly agreed to.

Resolved,

That this House takes note of European Community Document No. 8404/89 on the proposal for a European Company Statute ; and supports the Government's intention to seek to ensure that if there is to be a European Company Statute, it should contain a minimum of regulation consistent with the aim of providing adequate protection for those who may be involved with a company formed under the statute.

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