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Mr. Sayeed: Can the Secretary of State give us any examples of that? I am not aware of any employment agency that has ever so end-loaded a contract with a fee as to try to force a person whom they are contracting out to another company to remain in temporary employment rather than going on to full-time labour.

Mr. Byers: Such an example was given in Committee by my hon. Friend the Member for Corby (Mr. Hope). He reported the case of a worker who formerly worked for a transport agency and was offered a better paid job by a distribution company. The transport agency through which he had previously worked had included in his contract an "introduction fee" of £2,500, many times the cost of recruiting a worker in that sector. As a result, that worker was unable to take up that particular post. That is an example of the difficulties that can be caused and which we are seeking to overcome.

Mr. Ian Bruce: We are getting to the nub of the issue. A penalty clause--one that makes it more expensive to recruit someone via a temp to perm arrangement--might well require some regulations. I do not think that the industry would be unhappy with that, but surely the Minister is saying that all such temp to perm fees would be outlawed. I have already said why that would mean that a temp could be taken on just for a week and then be followed by another temp. If someone is recruited under a temp to perm arrangement, I think that the industry wants a fee to be paid, as though that person had gone directly from the employment agency into a permanent job.

Mr. Byers: I said at the beginning that there would be no prohibition on the use of temp to perm clauses, but we are seeking to remove the potential for abuse of that system, whereby individuals can effectively have a price placed on their head and, as a result, find it very difficult to enter employment. That is the point I am seeking to clarify.

Miss Kirkbride: If the right hon. Gentleman is saying that he will allow temporary to permanent fees, will he say how he will judge what is an appropriate fee? Will it be based on a percentage of salary? What guidance can he give as to the level of fee that he would find acceptable?

Mr. Byers: These are issues on which I am prepared to take advice and to consult the industry. The level will need to be reasonable in the circumstances. That is the approach we intend to take. We want to prevent individuals from being exploited and denied employment opportunities. There is common cause among the parties that that is the mischief which we must address.

Mr. David Chidgey (Eastleigh): While the Secretary of State is undertaking his investigation and consultation,

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will he take note of an issue that has come to my attention and which affects the teaching profession? Apparently there is increased casualisation of the teaching profession--[Interruption.] I hope that he is able to take on board what I am saying, although he is clearly being distracted.

There is increasing evidence of growing casualisation in the teaching profession. More and more teachers are finding that they cannot get permanent contracts, only supply work. That in itself is not too much of a problem, but difficulties arise because an increasing number of schools, instead of operating their own lists of supply teachers, are going to employment agencies which are able at short notice to fulfil--

Mr. Deputy Speaker: Order. I know that the hon. Gentleman is speaking about a highly technical matter, but the House's rules are clear: interventions must be brief. The hon. Gentleman has been as brief as I can allow him.

Mr. Byers: In that brief intervention, the hon. Member for Eastleigh (Mr. Chidgey) made his point. All I can say is that my right hon. Friend the Secretary of State for Education and Employment has some radical measures that will make teaching a much more attractive profession, which may help some of the individuals to whom the hon. Gentleman referred.

I hope that I have made the Government's intentions clear in respect of temp to perm fees.

The hon. Member for South Dorset raised a number of issues around the regulations, and we shall consider them as part of the consultation process. They were not really questions for me so much as general matters relating to the subject. His points were well made, and we shall consider his comments in the consultation exercise.

In speaking to amendment No. 34, the hon. Member for Daventry encouraged me to endorse the affirmative procedure for the regulations. I set great store by the regulations, and there is merit in ensuring that they are open to effective scrutiny. Clearly, if things remain as they are, there will be an opportunity for Opposition Members to pray against them, and we may well have a debate in the House or in Committee. If the regulations are subject to the affirmative procedure, such a debate will be guaranteed.

I cannot agree to amendment No. 34 this evening, but there is significant merit in the suggested approach. I should like to consider that approach; perhaps we shall be able to respond more positively in another place. I hope that I have been able to address Opposition Members' concerns on this very important matter.

7.15 pm

There is no prejudice against employment agencies on the part of the Government. We believe that they have an important role to play in a flexible and prosperous labour market. Very often, they deal with people who, for private reasons, choose to be temporary and do not wish to take permanent contracts. Employment agencies are a growth sector, one which we want to ensure can properly address the challenges that lie ahead in the next century.

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For those reasons, I invite the House to support Government amendment No. 59 and new schedule 2, but to resist the Opposition amendments.

Mr. Redwood: I am aware that we have had a longish debate, but I should like to make a few brief points in reply to the Secretary of State and in order to give guidance to Opposition Members in the light of his comments.

I found the Secretary of State's set of replies by far the best that I have ever heard him give. I am grateful to him for going some way to meet the concerns of my right hon. and hon. Friends. I thought that his response to my hon. Friend the Member for Daventry (Mr. Boswell) was particularly good. We are reassured about the hours of visits and by the fact that the right hon. Gentleman has checked with lawyers about the European convention on human rights--we do not want the taxpayers or the Government to be faced with an expensive court case. We are also reassured that no forcible entry is allowed under the regulations.

We accept the right hon. Gentleman's reassurances in the spirit in which they were intended. They show that the Report stage can be valuable in clarifying such matters, as we gave the Secretary of State the opportunity to put his assurances on record. Many people in the affected industry will be interested to read his remarks, and I am sure that they will be greatly heartened by them.

In response to my hon. Friend the Member for South Dorset (Mr. Bruce), however, I fear that we did not get quite as much as we would have liked, as I am sure the Secretary of State will understand. My biggest worry about the late arrival of the new schedule and the associated changes is the absence of a proper cost assessment.

I quite understand why the Secretary of State is in a difficult position. He saw that the original proposals were not going to work very well, and understandably wished to amend them. Because of the pressure of time on the business of the House, he has not had enough time to go through everything properly and come to the House with an impact assessment of the costs. That is of course a pity because it follows the recent famous statement by the Minister for the Cabinet Office--made not so many hours ago--to the effect that one of the most important things for the Government was to ensure that any new regulation would be accompanied by a proper assessment of the costs for those affected. We now have one of the first examples of new regulations with no impact cost assessment.

I am worried about the possible costs. I understand that the proposals are well intentioned and that the Secretary of State considered their length in terms of the number of words and pages in an attempt to make them a little more user-friendly, to use the management jargon beloved of this Government. However, I would find it much more reassuring if we had a proper cost assessment from the Government so that we could see how much each employment agency is likely to face by way of additional compliance costs. We could then work out the impact on their charging policies and on the number of people they could afford to employ themselves. There is a worry that the cost could get out of control.

Previous Government exercises have revealed that the Government often understate the compliance costs, sometimes quite dramatically. We certainly felt that to be

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the case with the competition legislation. Indeed, we now learn from businesses around the country that it is proving much dearer to take the right advice from lawyers in preparation for the new regime than the House was originally told at the time.

The Bill is still quite complicated and we need to be cautious about the costs that it might entail. That is my worry. I am glad that the Secretary of State made it clear that he does not wish to prohibit the charging of fees where there is a move from temporary to permanent employment. We would hope that the idea that someone obtains a temporary job and that that leads to permanent employment could be actively promoted.

That movement often occurs even though the temporary staff member has been found through an employment agency. Many employment agencies would regard that as a success. However, understandably, they wish to protect their business interests to a realistic degree. That being so, the Secretary of State's clarification that there is no prohibition on the charging of fees was most welcome.

As the Secretary of State has said, there may need to be some control over the abuse of clauses limiting or controlling the movement from temporary to permanent employment. I concede, as do my hon. Friends who know the employment agency industry better than I, that there could be such cases.

It is clear that these matters are confusing when even my hon. Friend the Member for South Dorset and others who are well versed in them were not clear about the Government's intention from the amendment paper and the draft schedule. I ask the Secretary of State, with his draftsmen and lawyers, to reconsider the language of their proposals. It is not clear to us from the draft legislation before us that the right hon. Gentleman will achieve his quite sensible objective.

We should also like a little more information, when the Bill returns to this place, on how abuses can be controlled. We would want to ensure that abuses were narrowly defined so that a new burden was not placed on those carrying out these activities.

The Secretary of State made the sensible comment that he wants fewer restrictions because he would like to see a more flexible market. If we introduce the crude instrument of the law into a series of detailed and often different negotiations and contracts between individuals and firms, we shall end up with a worse answer rather than a better one.

When we have had time to study the schedule at greater length, I suspect that we will find that it is not loophole proof. The Secretary of State and his advisers may well find, following further consultation, that it is necessary to introduce additional amendments. He may find that it is possible to find a way round the provisions, which he has put forward in something of a hurry. To me, that implies that we need effective scrutiny of the regulations that will follow. We have only the bare bones before us tonight, even though there is quite a lengthy schedule and a series of amendments. We know that a series of regulations have to follow.

The Secretary of State did not give us a firm guarantee that we would definitely have a decent debate on the ensuing regulations, which we think is the minimum required given that what is before us came very late, did not go through the normal Committee process and may contain drafting problems. For that reason and others, we

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cannot simply accept the Secretary of State's amendments. Similarly, we cannot leave our amendments, which were meant well, to try to improve this draft legislation, without pressing them to a vote.

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