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My hon. Friend the Member for Lichfield (Mr. Fabricant) put up a robust performance in support of the new clause and amendments, explaining why it was important for us to emulate the American model. We hear from Labour Members that they have been converted to parts of American enterprise capitalism, but they still do not seem to understand that small businesses are flourishing in the United States of America because they are exempt from most of the regulation that Labour proposes to inflict on British business in this and related legislation.

My hon. Friend the Member for Bromsgrove (Miss Kirkbride) made a strong case for businesses in her area, drawing on her constituency experience. My hon. Friend always puts the case for her local people with passion and skill. My hon. Friend the Member for Altrincham and Sale, West (Mr. Brady) explained how absurd it was for the Government to claim that they believed in deregulation, while introducing measure after measure that imposes cost after cost on business--which in turn creates job loss after job loss, as we see every day.

My right hon. Friend the Member for Fylde (Mr. Jack) said that the Secretary of State had been heckled at a recent small business conference. I am not surprised that he was heckled; it was entirely predictable. If he had listened to small businesses, as we have in recent months, he would know how angry they are about this legislation, and about all the legislation that has already been foisted on them by a Government who do not understand their requirements.

The Secretary of State tells us that he now knows that small business wants more deregulation. He has promised small firms a pow-wow--a conference with him, enabling them to explain the ways in which they want more deregulation. We have been telling the right hon. Gentleman for months that they want more deregulation, and tonight, we have offered him a chance to show how that can be done. We have tabled two new clauses. If he accepts them after this short debate--he can do so, even at the eleventh hour--he will show not only that he has begun to understand that business is cross, but that he wants to do something about it. He should be saying sorry for the regulations that he has introduced, and for those introduced by his two predecessors, the two previous Presidents of the Board of Trade--as they liked to be known. Instead, we see a Secretary of State who has learned nothing, and who wants to do nothing to help the business cause that he should be furthering.

Mr. Bercow: Will my right hon. Friend reflect on the fact that, despite the Secretary of State's honeyed words

30 Mar 1999 : Column 915

in the Chamber tonight, his hon. Friend the Minister for Small Firms, Trade and Industry has refused to give any undertaking that the regulations resulting from the Bill will be shorter than those relating to the working time directive and the national minimum wage, which fill 72 and 112 pages respectively?

Mr. Redwood: They will doubtless be as long or longer. The Secretary of State clearly finds that amusing. He should try responding to that degree of regulation while running a small enterprise with only a few staff, and trying to make ends meet under Labour's economic policies.

The Secretary of State does not seem to understand that the problems caused by high interest rates, high exchange rates and high taxes--all of which I mentioned in my opening remarks--are being greatly compounded by legislation such as this, which leaves business chronically short of the cash that it needs to employ people, to invest in the future and to modernise--something of which the present Government might be expected to approve. We have heard a series of cheap, juvenile debating points from the right hon. Gentleman, which we have heard many times before and to which we have responded adequately in the past. Yes, there were job losses and closures in 1992; but when will the Labour party apologise for supporting the policies that were being pursued then, and when will it learn from them? When will it understand that it is beginning to replicate exactly the conditions that obtained at that time? We have listened; we have learned; we know that the present position is wrong. Why cannot the Secretary of State appreciate the damage that his rerun is doing to industry in this country?

Mr. Ian Stewart: It is a bit rich for the right hon. Gentleman to say that, given the inheritance left by his Government. One family in five in this country contains not one working person, and that does not include pensioners.

Mr. Redwood: We left a golden economic legacy of falling unemployment, low inflation, growth and prosperity, and a flourishing small business enterprise culture. That is being destroyed by this Government--by their wanton economic policies, and by the regulation and laws that they are introducing.

The Secretary of State says that I should show a little less passion, but I will not. This matters. The Secretary of State should try listening. He should understand that many livelihoods are being destroyed by this Government's policies, and he should wake up and do something about it.

The Minister for Small Firms, Trade and Industry dared to smile when it was suggested that he should be worried about the shrinking of the small business sector as small businesses went under. He smiles again, in a rather lacklustre way. I assume that he is giggling now because he realises that the small business sector will not shrink. For every firm that goes under while this Government are in office, another medium-sized firm will shrink and replace it, becoming a new small firm. That is the Minister's small firms policy: if the medium-sized firms are damaged, he will have more candidates to preside over in his inimitable way.

30 Mar 1999 : Column 916

The overwhelming weight of evidence from business organisations, Members of Parliament and constituents in businesses who lobby us points in the same direction. It suggests that small business must be exempted from these and any other regulations introduced by the Government. Does the Secretary of State understand that, if a firm with 21 employees which will be caught by the legislation in its present form needs one extra person to handle all the regulation and bureaucracy, that will constitute a 5 per cent. increase in its costs? For a firm with 1,000 employees, which may need only three extra people to handle the bureaucracy, the increase in costs will amount to only 0.3 per cent.--not welcome, but much less serious than the impact on the small firm. Is that fair? Does the Secretary of State wish to encumber small firms in such a way, allowing big firms a competitive advantage? That is one of our main reasons for proposing this important exemption.

An entrepreneur in a business with 20 or 30 employees may be the leader of a sales team. He may supervise production. He may be involved in design. He cannot take on more; yet the Secretary of State expects him to implement these measures, and supervise the company's response to a new range of statutory requirements.

The right hon. Gentleman asks whether my hon. Friends and I want people to be denied leave when their children are ill. Of course we do not--that is an outrageous suggestion--but in a small business, in which employer and employee have an individual relationship, such matters can be sorted out without the law intruding. The law is far too clumsy. Resort to lawyers will not help relationships in small firms; it will hinder them. It will generate another unnecessary cost for a small firm that may go under as a result, because the burdens will be far too great.

It is not good enough for the Secretary of State to promise some new review of the regulatory burdens that he and his predecessors have introduced. It is not good enough for him to blame past Governments. The burden is much greater now, the protest is much stronger now, and the small business community is much angrier now, because of the huge burdens imposed by taxes and regulations under the present Government. They are throwing away our golden economic legacy. They are making it too dear to make things in Britain.

Labour is undoubtedly bad for business. If this Secretary of State wants to do some deregulating, he should start now by instructing his team of Members to back our new clauses.

Question put, That the clause be read a Second time:--

The House divided: Ayes 131, Noes 348.

Division No. 133
[7.8 pm


AYES


Ainsworth, Peter (E Surrey)
Amess, David
Ancram, Rt Hon Michael
Arbuthnot, Rt Hon James
Baldry, Tony
Beggs, Roy
Bercow, John
Beresford, Sir Paul
Blunt, Crispin
Body, Sir Richard
Boswell, Tim
Bottomley, Peter (Worthing W)
Brady, Graham
Brazier, Julian
Brooke, Rt Hon Peter
Browning, Mrs Angela
Bruce, Ian (S Dorset)
Burns, Simon
Butterfill, John
Chapman, Sir Sydney
(Chipping Barnet)
Chope, Christopher
Clappison, James
Clark, Rt Hon Alan (Kensington)
Clark, Dr Michael (Rayleigh)
Clifton-Brown, Geoffrey
Collins, Tim
Colvin, Michael
Cormack, Sir Patrick
Cran, James
Curry, Rt Hon David
Davies, Quentin (Grantham)
Davis, Rt Hon David (Haltemprice & Howden)
Dorrell, Rt Hon Stephen
Duncan, Alan
Duncan Smith, Iain
Faber, David
Fabricant, Michael
Fallon, Michael
Flight, Howard
Forsythe, Clifford
Forth, Rt Hon Eric
Gale, Roger
Gibb, Nick
Gill, Christopher
Goodlad, Rt Hon Sir Alastair
Gorman, Mrs Teresa
Gray, James
Green, Damian
Greenway, John
Grieve, Dominic
Hague, Rt Hon William
Hamilton, Rt Hon Sir Archie
Hammond, Philip
Hawkins, Nick
Hayes, John
Heald, Oliver
Hogg, Rt Hon Douglas
Horam, John
Howarth, Gerald (Aldershot)
Hunter, Andrew
Jack, Rt Hon Michael
Jackson, Robert (Wantage)
Jenkin, Bernard
Johnson Smith,
Rt Hon Sir Geoffrey
Key, Robert
King, Rt Hon Tom (Bridgwater)
Kirkbride, Miss Julie
Lait, Mrs Jacqui
Lansley, Andrew
Leigh, Edward
Letwin, Oliver
Lewis, Dr Julian (New Forest E)
Lidington, David
Lloyd, Rt Hon Sir Peter (Fareham)
Loughton, Tim
Luff, Peter
McIntosh, Miss Anne
MacKay, Rt Hon Andrew
Maclean, Rt Hon David
McLoughlin, Patrick
Madel, Sir David
Malins, Humfrey
Maples, John
Maude, Rt Hon Francis
May, Mrs Theresa
Moss, Malcolm
Nicholls, Patrick
Norman, Archie
Ottaway, Richard
Page, Richard
Paice, James
Pickles, Eric
Prior, David
Randall, John
Redwood, Rt Hon John
Robertson, Laurence (Tewk'b'ry)
Rowe, Andrew (Faversham)
Ruffley, David
St Aubyn, Nick
Sayeed, Jonathan
Shephard, Rt Hon Mrs Gillian
Shepherd, Richard
Simpson, Keith (Mid-Norfolk)
Soames, Nicholas
Spelman, Mrs Caroline
Spring, Richard
Stanley, Rt Hon Sir John
Steen, Anthony
Swayne, Desmond
Syms, Robert
Tapsell, Sir Peter
Taylor, Ian (Esher & Walton)
Taylor, John M (Solihull)
Taylor, Sir Teddy
Townend, John
Tredinnick, David
Trend, Michael
Tyrie, Andrew
Viggers, Peter
Wardle, Charles
Waterson, Nigel
Wells, Bowen
Whitney, Sir Raymond
Whittingdale, John
Widdecombe, Rt Hon Miss Ann
Wilkinson, John
Winterton, Mrs Ann (Congleton)
Winterton, Nicholas (Macclesfield)
Woodward, Shaun
Yeo, Tim
Young, Rt Hon Sir George

Tellers for the Ayes:


Mrs. Eleanor Laing and
Mr. Stephen Day.


NOES


Abbott, Ms Diane
Ainger, Nick
Ainsworth, Robert (Cov'try NE)
Allan, Richard
Allen, Graham
Anderson, Donald (Swansea E)
Atherton, Ms Candy
Atkins, Charlotte
Austin, John
Baker, Norman
Banks, Tony
Barnes, Harry
Barron, Kevin
Battle, John
Bayley, Hugh
Beard, Nigel
Beckett, Rt Hon Mrs Margaret
Bell, Martin (Tatton)
Bell, Stuart (Middlesbrough)
Bennett, Andrew F
Benton, Joe
Bermingham, Gerald
Berry, Roger
Best, Harold
Betts, Clive
Blackman, Liz
Blears, Ms Hazel
Blizzard, Bob
Borrow, David
Bradley, Keith (Withington)
Bradley, Peter (The Wrekin)
Bradshaw, Ben
Brinton, Mrs Helen
Brown, Russell (Dumfries)
Browne, Desmond
Bruce, Malcolm (Gordon)
Buck, Ms Karen
Burden, Richard
Burgon, Colin
Burstow, Paul
Butler, Mrs Christine
Byers, Rt Hon Stephen
Caborn, Richard
Campbell, Alan (Tynemouth)
Campbell, Mrs Anne (C'bridge)
Campbell, Ronnie (Blyth V)
Campbell-Savours, Dale
Canavan, Dennis
Cann, Jamie
Caplin, Ivor
Cawsey, Ian
Chapman, Ben (Wirral S)
Chaytor, David
Chidgey, David
Clapham, Michael
Clark, Rt Hon Dr David (S Shields)
Clark, Dr Lynda
(Edinburgh Pentlands)
Clark, Paul (Gillingham)
Clarke, Charles (Norwich S)
Clarke, Tony (Northampton S)
Clwyd, Ann
Coaker, Vernon
Coffey, Ms Ann
Cohen, Harry
Coleman, Iain
Colman, Tony
Connarty, Michael
Cooper, Yvette
Corbett, Robin
Corbyn, Jeremy
Cotter, Brian
Cousins, Jim
Cranston, Ross
Crausby, David
Cryer, Mrs Ann (Keighley)
Cryer, John (Hornchurch)
Cummings, John
Cunningham, Jim (Cov'try S)
Curtis-Thomas, Mrs Claire
Dafis, Cynog
Dalyell, Tam
Darvill, Keith
Davey, Edward (Kingston)
Davey, Valerie (Bristol W)
Davidson, Ian
Davies, Rt Hon Denzil (Llanelli)
Davies, Geraint (Croydon C)
Dawson, Hilton
Denham, John
Dismore, Andrew
Dobbin, Jim
Donohoe, Brian H
Dowd, Jim
Drown, Ms Julia
Eagle, Maria (L'pool Garston)
Edwards, Huw
Efford, Clive
Ellman, Mrs Louise
Ennis, Jeff
Etherington, Bill
Ewing, Mrs Margaret
Fearn, Ronnie
Fisher, Mark
Fitzpatrick, Jim
Fitzsimons, Lorna
Flint, Caroline
Flynn, Paul
Follett, Barbara
Foster, Rt Hon Derek
Foster, Michael J (Worcester)
Fyfe, Maria
Gapes, Mike
Gardiner, Barry
George, Andrew (St Ives)
George, Bruce (Walsall S)
Gerrard, Neil
Gibson, Dr Ian
Gilroy, Mrs Linda
Godman, Dr Norman A
Godsiff, Roger
Goggins, Paul
Golding, Mrs Llin
Gordon, Mrs Eileen
Griffiths, Nigel (Edinburgh S)
Griffiths, Win (Bridgend)
Grocott, Bruce
Grogan, John
Hain, Peter
Hall, Mike (Weaver Vale)
Hall, Patrick (Bedford)
Hancock, Mike
Hanson, David
Harman, Rt Hon Ms Harriet
Heal, Mrs Sylvia
Healey, John
Heath, David (Somerton & Frome)
Henderson, Ivan (Harwich)
Hepburn, Stephen
Heppell, John
Hesford, Stephen
Hill, Keith
Hinchliffe, David
Hodge, Ms Margaret
Hoey, Kate
Home Robertson, John
Hood, Jimmy
Hoon, Geoffrey
Hope, Phil
Hopkins, Kelvin
Howells, Dr Kim
Hoyle, Lindsay
Hughes, Ms Beverley (Stretford)
Hughes, Kevin (Doncaster N)
Humble, Mrs Joan
Hurst, Alan
Hutton, John
Iddon, Dr Brian
Illsley, Eric
Jackson, Ms Glenda (Hampstead)
Jackson, Helen (Hillsborough)
Jenkins, Brian
Johnson, Alan (Hull W & Hessle)
Johnson, Miss Melanie
(Welwyn Hatfield)
Jones, Barry (Alyn & Deeside)
Jones, Helen (Warrington N)
Jones, Ms Jenny
(Wolverh'ton SW)
Jones, Jon Owen (Cardiff C)
Jones, Dr Lynne (Selly Oak)
Jones, Martyn (Clwyd S)
Jowell, Rt Hon Ms Tessa
Keeble, Ms Sally
Keen, Alan (Feltham & Heston)
Keen, Ann (Brentford & Isleworth)
Kelly, Ms Ruth
Kemp, Fraser
Kennedy, Jane (Wavertree)
Khabra, Piara S
Kidney, David
King, Andy (Rugby & Kenilworth)
King, Ms Oona (Bethnal Green)
Kingham, Ms Tess
Kirkwood, Archy
Ladyman, Dr Stephen
Laxton, Bob
Lepper, David
Leslie, Christopher
Levitt, Tom
Lewis, Ivan (Bury S)
Lewis, Terry (Worsley)
Linton, Martin
Livingstone, Ken
Livsey, Richard
Lloyd, Tony (Manchester C)
Llwyd, Elfyn
Lock, David
Love, Andrew
McAvoy, Thomas
McCabe, Steve
McDonagh, Siobhain
Macdonald, Calum
McDonnell, John
McGuire, Mrs Anne
McIsaac, Shona
McKenna, Mrs Rosemary
Mackinlay, Andrew
McLeish, Henry
McNamara, Kevin
McNulty, Tony
MacShane, Denis
Mactaggart, Fiona
McWalter, Tony
McWilliam, John
Mahon, Mrs Alice
Mallaber, Judy
Mandelson, Rt Hon Peter
Marsden, Gordon (Blackpool S)
Marsden, Paul (Shrewsbury)
Marshall, Jim (Leicester S)
Martlew, Eric
Maxton, John
Meacher, Rt Hon Michael
Merron, Gillian
Michie, Bill (Shef'ld Heeley)
Milburn, Rt Hon Alan
Miller, Andrew
Mitchell, Austin
Moffatt, Laura
Moonie, Dr Lewis
Moran, Ms Margaret
Morgan, Ms Julie (Cardiff N)
Morgan, Rhodri (Cardiff W)
Morris, Ms Estelle (B'ham Yardley)
Mountford, Kali
Mullin, Chris
Murphy, Denis (Wansbeck)
Murphy, Jim (Eastwood)
Naysmith, Dr Doug
Norris, Dan
O'Brien, Bill (Normanton)
O'Brien, Mike (N Warks)
O'Hara, Eddie
Olner, Bill
O'Neill, Martin
Palmer, Dr Nick
Pearson, Ian
Pendry, Tom
Perham, Ms Linda
Pickthall, Colin
Pike, Peter L
Plaskitt, James
Pollard, Kerry
Pope, Greg
Pound, Stephen
Powell, Sir Raymond
Prentice, Ms Bridget (Lewisham E)
Prentice, Gordon (Pendle)
Prescott, Rt Hon John
Prosser, Gwyn
Purchase, Ken
Quin, Rt Hon Ms Joyce
Quinn, Lawrie
Radice, Giles
Rammell, Bill
Rapson, Syd
Raynsford, Nick
Reid, Rt Hon Dr John (Hamilton N)
Rendel, David
Roche, Mrs Barbara
Rogers, Allan
Rooney, Terry
Ross, Ernie (Dundee W)
Rowlands, Ted
Roy, Frank
Ruane, Chris
Ruddock, Joan
Russell, Bob (Colchester)
Russell, Ms Christine (Chester)
Ryan, Ms Joan
Sanders, Adrian
Sarwar, Mohammad
Sawford, Phil
Shaw, Jonathan
Sheerman, Barry
Sheldon, Rt Hon Robert
Shipley, Ms Debra
Simpson, Alan (Nottingham S)
Singh, Marsha
Skinner, Dennis
Smith, Rt Hon Andrew (Oxford E)
Smith, Angela (Basildon)
Smith, Jacqui (Redditch)
Smith, John (Glamorgan)
Smith, Llew (Blaenau Gwent)
Smith, Sir Robert (W Ab'd'ns)
Snape, Peter
Soley, Clive
Southworth, Ms Helen
Spellar, John
Squire, Ms Rachel
Starkey, Dr Phyllis
Steinberg, Gerry
Stevenson, George
Stewart, David (Inverness E)
Stewart, Ian (Eccles)
Stinchcombe, Paul
Stoate, Dr Howard
Stott, Roger
Stringer, Graham
Stunell, Andrew
Sutcliffe, Gerry
Taylor, Rt Hon Mrs Ann
(Dewsbury)
Taylor, Ms Dari (Stockton S)
Taylor, David (NW Leics)
Temple-Morris, Peter
Thomas, Gareth R (Harrow W)
Timms, Stephen
Tipping, Paddy
Todd, Mark
Tonge, Dr Jenny
Touhig, Don
Trickett, Jon
Truswell, Paul
Turner, Dennis (Wolverh'ton SE)
Turner, Dr Desmond (Kemptown)
Twigg, Derek (Halton)
Twigg, Stephen (Enfield)
Vaz, Keith
Vis, Dr Rudi
Wallace, James
Walley, Ms Joan
Ward, Ms Claire
Wareing, Robert N
Watts, David
Webb, Steve
Welsh, Andrew
White, Brian
Whitehead, Dr Alan
Wicks, Malcolm
Williams, Rt Hon Alan
(Swansea W)
Williams, Alan W (E Carmarthen)
Willis, Phil
Wills, Michael
Winnick, David
Winterton, Ms Rosie (Doncaster C)
Wood, Mike
Worthington, Tony
Wray, James
Wright, Dr Tony (Cannock)

Tellers for the Noes:


Mr. David Jamieson and
Mr. David Clelland.

Question accordingly negatived.

30 Mar 1999 : Column 920

New Clause 3

Codes of good employment practice


'.--(1) The Secretary of State may prepare, with the assistance of the Advisory Conciliation and Arbitration Service and after consultation with representatives of employers and employees, a Code or Codes of Good Employment Practice.


(2) Adherence to such a Code or Codes may be relied on as a defence to any proceedings before an employment tribunal by any employer who can demonstrate that his actions and procedures in connection with employment were reasonable in relation to the circumstances of his business, including its scale, turnover and labour force.
(3) No Code shall be issued under subsection (1) unless a draft of it has been laid before, and approved by a Resolution of, each House of Parliament.'.--[Mr. Boswell.]

Brought up, and read the First time.


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