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Mr. Bruce: I would like to answer my right hon. Friend--I am sorry, I meant my hon. Friend; I am sure that, one day, she will become my right hon. Friend--on the Government's intentions. When I was asked thesame question by the Federation of Recruitment and

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Employment Services, I rather cynically said that it would be when the Government had already got their Bill through the House of Lords and it had become an Act. We wanted to alert people, but when we asked the Under-Secretary whether we could make it public, he said, "No, we are not too keen on that." The 200,000 people in permanent employment for agencies and businesses would make the lorry drivers, farmers and the rest look like nothing demonstrating outside this place. It was clear that their employment would be under threat. Perhaps they do not know it yet, but the 900,000 people who do temporary work through employment agencies and the 380,000 who find permanent jobs every year through agencies may find that they no longer receive such an effective service.

If legislation is introduced that stops an employment agency making money in one way, agencies are bound to make it in some other way. Employment agencies are not something that can print money: they have to make a profit and they compete with other people. I know that because I ran one for a long period. In the first three or four years, I dared not show my bank manager what I was doing, because I was living off my savings. It takes an awful lot of money to set up an agency. If the Government are sincere in saying that they want employment agencies and businesses to be part of the flexible labour market in the United Kingdom--I accept the words in the draft document--the regulations that come after those comforting words must be wholly different from what the Government intend now.

The Minister has a mandate to regulate to protect employees who work through employment agencies and businesses. We do not argue against that, but the Government cannot reduce the employment opportunities of individuals.

I have given way extensively, and perhaps that has extended my remarks more than I intended.

6.30 pm

Mr. Ian Stewart: Will the hon. Gentleman give way?

Mr. Bruce: How could I resist the hon. Gentleman?

Mr. Stewart: Earlier, the hon. Gentleman asked why my hon. Friend the Member for Corby (Mr. Hope) was not in the Chamber and why, in a statement to the Committee, my hon. Friend had not given the name of a particular company. I intervened to point out that the hon. Gentleman had mentioned two companies without giving their names. I was asked to give the details from Hansard and I shall do so now--

Mr. Deputy Speaker (Mr. Michael J. Martin): Order. The hon. Gentleman must not make such long interventions.

Mr. Bruce: I invite the hon. Member for Eccles to buy me a drink after the debate and we shall discuss the matter; I am sure that we shall be able to sort it out. I suspect that, by not naming the companies, I was acting positively and trying not to advertise particular organisations--for example, those that now provide

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services in No. 10 Downing street. If I advertised such companies, I am sure that their principals would be only too pleased. The hon. Gentleman is a sportsman--

Mr. Stewart: And a friend.

Mr. Bruce: He is also a friend--in the real sense of that word--and will no doubt put me right later.

Mr. Jonathan Sayeed (Mid-Bedfordshire): My hon. Friend the Member for South Dorset (Mr. Bruce) began with what he described as a declaration of non-interest, but his remarks were clearly not a declaration of a lack of interest. It was a useful education for the House to spend a valuable hour or so listening to a former practising owner of an employment agency. I thank my hon. Friend for adding to my knowledge.

I have come across employment agencies in the past, but on the other side of the fence because I have used the temporary staff whom they sent me. The recruitmentand staffing service industry is highly fragmented; I understand that the largest company has only about 15 per cent. of the market. Consequently, the industry is highly competitive and, as an employer, when I have looked for staff, either to work temporarily or to take on as a full-time employee, by shopping around, I have found the right people at the right price. Like my hon. Friend in his business, I developed a relationship with a series of different suppliers.

That demonstrates that restrictive practices do not exist in that industry and that price sensitivity is rather important. It also demonstrates that employers want the right person, and they are prepared to pay for that. The right person is not merely someone who can do the job, but someone who is happy to do the job. A temp who believes that she, or he, is being diddled by the temp agency is not a happy employee and will not do the job well.

The Government are making a mistake in trying to restrict the fees of agencies, and that is borne out by my experiences as an employer. I would never want to take on a badly paid temp, because he or she would not work well. I would not be interested in taking on a temp from a cowboy agency; I want people who have been properly vetted and can do the job that I ask them to do. I do not mind paying for that, or for the flexibility that it offers. If I decided that a person was so good that I wanted them to take full-time work, I would not mind paying the agency for having found that person for me.

Miss Kirkbride: As an employer with his own business, my hon. Friend has experience that we now hear less about in the House. For hon. Members who have not had that experience, will he elucidate the difficulties that he might find in recruiting the right person if he went out into the market rather than going through an employment agency? Did he find that using an agency was better? How difficult did he find it to try to attract the right people using his own resources?

Mr. Sayeed: I thank my hon. Friend for those pertinent questions. In the past, I have tried to save the 10 or15 per cent. charged by employment agencies. That was a mistake, because I spent too much time trying to interview people and checking their skills, their qualifications, their

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CVs and references. That was a waste of my time. Horses should stick to courses and, unlike my hon. Friend the Member for South Dorset, my course was not choosing the right people to send to the right companies.

When I was running one company, it was so large that I set up an internal organisation to deal with recruiting, but I must admit that it was a bit of a failure and did not always attract the right people. One of the reasons is that, to attract the right people--especially in specialist areas--one has to broadcast one's message widely. I closed down that side of the business and went back to using professional recruiters. That is especially pertinent for the recruitment of specialist staff.

That brings me to my next point and to my problem with the Government's proposals. It is clear that the Government intend to penalise companies that restrict a temporary worker's ability to take a job directly with the hirer. Why do the Government want to do that? I should like to explain to them why it is a mistake from an employer's point of view. Often, temporary workers move, or are transferred, from one agency to another because it is simpler for the hiring company. Then, the employment agencies make arrangements between themselves about how to split fees. If one employs a large number of temps from different agencies, one often wants to consolidate them with one agency; it helps with the payroll and cuts down on administration. It is proper that, when a temp is transferred from one employment agency to another, the company losing the temp has a right to charge the company to which the temp is going. The Government appear to want to restrict that right. That is a mistake.

If we want employment agencies to be able to source, check and invigilate personnel so that companies can hire from them the best-qualified staff, the employment agencies must be rewarded for their work.

Mr. Redwood: My hon. Friend's experiences as an employer are most interesting. Does he agree that all Members of Parliament can join in this debate? It would be good to hear the views of Labour Members. Every Member of Parliament hires a secretary; many have more than one secretary and many have research assistants. Members often have to use the services of employment agencies when their staff are ill, on parental leave, or away for other reasons. Does my hon. Friend agree that the debate is relevant to all Members of Parliament, and that the experience of Labour Members might be useful in pointing out that the measure might be a step too far, because it would damage their capacity to find the temporary staff they need?

Mr. Sayeed: As I would expect, my right hon. Friend has made a most cogent point. However, we may well find that the researchers and secretaries of many Labour Members are hired by the trade union movement, which has supplied £100 million to the Labour party over the past few years. Labour Members might therefore be rather less interested than Conservative Members in the direct hiring of personnel.

The Bill will cause damage. The Government want to prevent employment agencies from benefiting from a temporary worker who becomes a permanent member

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of staff, but it is important that an agency is able to benefit from a company taking on as a permanent member of staff someone it has been sent as a temporary member of staff. The reason is simple: unless an employer has to pay the employment agent for providing it with a person of such quality that it might want to take on that person as a permanent member of staff, the likelihood is either that the agent will send someone who is just about adequate, and that is all; or that the employer will use that as a way of recruiting full-time members of staff at a cut price. The consequence of that is that the employment agent's quality of selection will decline. Therefore, it is a mistake for the Government to pursue the notion of restricting an agent from benefiting from a temporary worker's ability to take a job directly with the hirer.

We all want high standards of both staff and employment agents. We do not want workers to be exploited, in either their conditions or their pay. We clearly want action to be taken against restrictive practices in the contract between the employer and the employee, or the hirer and the employment company. Given that, the contract should count as a clear agreement between two consenting parties. There is no coercion in the employment and recruitment industry--it is too fragmented for there to be coercion. Consequently, provided that the industry abides by good practice, it should be left to get on with its important and valuable work.

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