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Mr. David Rendel (Newbury): May I make just a few points on behalf of the Liberal Democrats? We accept the Conservatives' point that the proposal is being rushed through with minimum consultation. As my hon. Friend the Member for Northavon (Mr. Webb) succeeded in pointing out in an intervention, little thought seems to have been given to how the measure will be put into practice. The Minister might do well to think again about his response to my hon. Friend and come up with some clearer plans on how he will ensure that those concerned realise that they may be eligible for new benefits. Simply telling them to look at their pay slips--if they have a pay slip at all--is not good enough.

None the less, we welcome the new clause. We have been pressing for some time for better and wider maternity benefits, and this is an attempt to provide them. The Government continually tell us that the Bill's aim is to provide more benefits to those who need them most,

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and we seem to be proceeding a little way down that path. However, as is so often the case with this Bill, it is not the very poorest who will be helped because they earn below the limits covered by the new clause--or perhaps earn nothing at all. A number of mothers will therefore not be affected by the provision, which will give a little more to those who are not quite the very poorest, but who are poorer than those who have been receiving the benefit until now. That is at least a step in the right direction.

One of the most important things that any child can have is a good start in life, and we can help babies in that respect by reducing the stress on their mothers. Reducing financial stress, both before and immediately after birth, must therefore be of benefit not just to mother, baby and the bonding process, but to the whole of society. The Liberal Democrats welcome the new clause in so far as the Government are at least making a move towards providing those advantages by the extension of this benefit.

4.15 pm

Mr. Bayley: I shall begin by responding to the hon. Member for Tiverton and Honiton (Mrs. Browning). I welcomed her intervention because she made an important point. Having listened to her speech, I am now clear that she misunderstands the basis on which maternity allowance is currently paid to self-employed people. The benefit is based not on income, but on national insurance contributions. The national insurance contribution records will permit or deny access to maternity allowance.

The contributory conditions for self-employed women are unchanged by the new clause. A woman will have had to have paid 26 contributions in the 66 weeks leading up to the birth. What is new is that maternity allowance at the reduced rate will now, for the first time, be available to self-employed women on low earnings who havesmall earnings exemptions from national insurance contributions for at least 26 weeks before the birth, so they will not have to file accounts to prove earnings. The hon. Member for Tiverton and Honiton is suffering from a misapprehension.

Mrs. Browning: I am familiar with the contributions aspect, but my understanding is that there will in addition be an earnings threshold at which the benefit would apply. If there is to be an earnings threshold, there will clearly have to be some proof of earnings.

Mr. Bayley: Hitherto, a self-employed woman has been able to obtain the maternity allowance on the basis of having paid 26 national insurance contributions in the 66 weeks before the birth. Some self-employed women, such as those who are setting up a business for the first time--precisely the women to whom the hon. Lady referred--will not have paid national insurance contributions because their earnings from their business will be too low to require them to pay contributions. If they have applied and qualified for the small earnings exemption for at least 26 weeks in the period leading up to the birth, they will qualify for the £27 rate of maternity allowance that we propose, which is 90 per cent. of the £30 bottom earnings limit that we are introducing for employed people.

Mrs. Browning: In addition to their national insurance contributions exemption, a mechanism will have to be

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agreed in advance to establish the exact tax point in the earnings of those women at which the threshold will make them eligible. As I said, often their drawings from their business accounts may be minimal in order to enable their business to grow, and the accounts may show that they plough more back into the business. Will that be taken into account?

Mr. Bayley: The hon. Lady has raised an important point, but she is making the matter more complicated that it needs to be. We do not need new regulations. People who run their own businesses do not need to submit accounts to qualify for maternity allowance. It will depend on their national insurance record. If people apply for the small earnings exemption from national insurance contributions for 26 weeks before the birth, that would passport them on to a maternity allowance. We do not need a new test of earnings: women who have established their entitlement through the existing national insurance system will now, for the first time, receive maternity allowance.

The hon. Member for Newbury (Mr. Rendel) asked how we will get the word out. Self-employed people, particularly those who have started up businesses through the new deal, will get support from their mentor. Under the new deal, someone setting up a new business gets a mentor for two years. If the new entrepreneur is a woman who becomes pregnant during those two years, it will be the responsibility of the mentor to explain her rights.

As for other women who are employed, at present a woman who is earning £66 a week knows how to claim. Now a woman earning £65 a week, who has hitherto been unable to claim, will submit her claim in exactly the same way. The only difference is that now, when women earning £65, £45 or £30 a week claim maternity allowance, they will be told that they qualify rather than that they do not, and will receive benefit.

Let me tell the hon. Member for Beckenham (Mrs. Lait) that if the Conservatives oppose the new clause, they will perpetuate a two-tier system--indeed, two-tier systems. They will be saying that it is right for the law to provide maternity allowance for women on higher incomes, but wrong for it to provide the allowance for those on lower incomes. That is an absurd attitude. Moreover, the hon. Lady will be saying that it is right for a woman who is employed to receive maternity allowance at a rate of nearly £60 a week, but that those who are self-employed should be paid a lower rate.

We are correcting those two wrongs. We are enabling all women earning £30 a week or more to receive maternity allowance, which must be a good thing. It is extraordinary that the hon. Lady should suggest that members of her party will vote against the new clause.

The question that the hon. Lady must answer is the question that some of my hon. Friends posed to her during her speech: is her party in favour of extending maternity allowance to low-paid women or not? Low-paid women already have a right to maternity leave, but those who are so low paid that they are below the lower earnings limit do not receive maternity allowance, and therefore cannot afford to take the leave. Women on higher incomes receive maternity leave, and the allowance enabling them to afford to take it. That is good for their health and the health of the child; but women below the lower earnings limit are denied the same opportunity.

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If Conservative Members shoot through the Lobby to vote against the new clause, they will be condemning women on lower earnings to a denial of their right to maternity allowance. I should find it extraordinary were that to happen.

The hon. Lady complained that the Government had tabled the new clause only on Thursday of last week. I can only assume that she has been asleep, not just over the weekend but since 6 May, when the new clause was actually tabled. Moreover, although 11 days' notice may not have been enough for her, the issue was flagged up for her two months ago in the Chancellor's Budget speech. The proposal has not been sprung on the House without warning or prior consideration. In the case of every Bill, new measures are presented as the Bill proceeds; and that is exactly what is happening now.

The new provision will not impose a burden on business. Under existing provisions, the Benefits Agency checks a percentage of claims with employers to confirm employment, and to confirm that the appropriate national insurance contributions have been paid. We believe that the new scheme will reduce the need for the agency to check claims, because wage slips will constitute an additional verification of employment. The extra burdens on business will therefore be negligible.

Mr. Bercow: The Minister said, to a fanfare of trumpets, that the new clause would not be burdensome on business. Does he seek to distinguish it from, for example, another measure to which he referred in his opening remarks--the working families tax credit, whose implementation has already been denounced by employers' representatives as distinctly burdensome?

Mr. Bayley: The hon. Gentleman should listen to what I am saying. Under the new clause, there is no requirement for businesses to file additional returns or answer additional questions. In fact, we believe that the use of wage slips as passports to maternity allowance will somewhat reduce the need for the Benefits Agency to carry out checks. The hon. Gentleman's fears are therefore groundless.

The argument of the hon. Member for Beckenham that the new provision might deter employers from employing women of child-bearing age is a crassly stupid point. It is a point that her party made when the Equal Pay Act 1970 was introduced--that equal pay should not be introduced for women because employers would not employ women if it were. We know what has happened since the Act has come in. Even though pay may not quite have equalised, the relative earnings of women have increased dramatically, and the number of women in the labour market has continued to grow. The hon. Lady's fear is absolutely groundless.

The hon. Member for Beckenham said that the provision would affect just 14,000 people. She may have misunderstood something that I said earlier. There are 14,000 employed women on wages that have hitherto been judged to be too low to qualify for maternity allowance. In future, they will qualify; they will get the allowance. That is at the core of what the new clause is about. In addition, however, there are the 13,000 self-employed people who either have never qualified because their earnings were too low, or who have qualified for some allowance; in future, they will qualify

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to a greater extent because of our decision to pay the self-employed woman who has a baby the same rate of maternity allowance as the employed woman.

The hon. Member for Beckenham complains on two fronts. She complains that we will not put the measure into effect until 2000 and that we are dragging our feet, yet at the same time, she says that we are abusing our role by introducing the measure so quickly. She cannot have it both ways.

The Conservative party does not have long to make up its mind. It will have to decide one way or the other how to vote on the measure. It has to decide whether women on low earnings should get the same right to paid time off when they have a baby as women who are on higher earnings. If it believes that they should, it will vote with the Government. If it believes that one should discriminate against women on low pay and against the self-employed, it will vote against. That is the simple question that it has to consider. I hope that it will support the Government's proposal.


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