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Mr. Hammond: The hon. Gentleman has twice implied that unscrupulous employers seek to define
workers other than as employees. Will he consider the fact that the national health service is probably the largest employer of agency workers, who are not employees, in this country?
Mr. Doran: The NHS is a good employer that recognises its unions, regularly negotiates terms and conditions and ensures that agency employees have minimum standards. That is crucial, but many employers will not operate in that way. All those various categories were created, on the basis of legal advice, to avoid giving workers the full benefit of the legislation.
Mr. Lloyd: Does my hon. Friend agree that this is an important debate because its thrust is not to say that different employment structures are illegitimate, but to offer legitimate protection to those who are not brought within the ambit of the law? That is the implication of my hon. Friend's remarks, but I am rather worried about the Opposition's intentions.
Mr. Doran: I agree entirely with my hon. Friend; we are as one on that. It is important that we get back to basic principles. That is why I referred to "Fairness at work", which contains fundamental principles; my worry is that we shall move away from them under the Bill. I welcome the fact that the Secretary of State said that there would be a review, but my worry is that the Bill's reintroduction of the term "employee" will lead some people to pre-empt the decision that she makes in the review.
We certainly do not want to introduce the possibility that the fundamental protections for workers that we have introduced under the National Minimum Wage Act 1998 and the Employment Relations Act 1999 could be weakened. There are many good things in the Bill. I have raised two issues that need to be seriously addressed by the Government, but, of course, I support the Bill in principle.
7.25 pm
Mr. Mark Prisk (Hertford and Stortford): At the beginning of this debate, the Secretary of State said that the Bill is friendly to families. It is true to say that the Bill sets out a range of improved maternity rights, new paternity rights and rights for adoptive parents. Like many of my Opposition colleagues, I certainly welcome any acknowledgement of the role of fathers. Over the years, bolstering and supporting the role of fathers has been neglected, and there has been an understandable focus on motherhood. It is important, however, that we try to encourage fatherhood wherever we can, through policies and positive role models. I welcome the acknowledgment of that fact in the Bill.
A further point is recognition of the crucial role of single fathers. Very often, when we talk about single parents, we assume that we are talking about single mothers, so it is important that we recognise the role of single fathers. I want to ensure that they are not overlooked in any way. I acknowledge the importance of adoptive families and the fact that they will be included in the legislation. It is sadly still the case that, even now, too few people are willing to come forward as adoptive parents. Anything that can be done to promote adoptive parents is important, and I commend the recognition of that fact in the Bill.
However, the Bill is distinctly unfriendly to a very large number of families. The hon. Member for Twickenham (Dr. Cable), who is not in his place, has already mentioned the intrusive nature of clause 47, with regard to families who have disabled members. Although I support his view, there is another very important and large group of families to whom the Bill is rather negative. I am referring to the 4 million self-employed families, who work long hours each week and try to bring up their children. Those families often live and work in the same place and find that, to comply with many of the Government's regulations, they have to work right through their weekends or evenings, so they are not able to spend time with their children.
Indeed, as my hon. Friend the Member for Maldon and East Chelmsford (Mr. Whittingdale) said, most small businesses now expect to spend 48 hours—five normal working days—each month trying to keep up with the raft of proposed regulations. That involves days lost at weekends and evenings lost with children—a very important matter for those families. I suspect that hon. Members on both sides of the House will know the families to whom I refer—the husband and wife who run the local post office; the father and daughter on the farm; the two brothers who may provide a local plumbing or decorating service; or the local family butchers. Many of those businesses have been handed down from one generation to the next.
My father set up and ran his own business, so I know all too well that, no matter what age those involved may be, they are always involved in the success or trials of the business. Thus, the nature of work and family is intertwined in every self-employed home. Those families—the self- employed, the small business proprietor—represent not only the hard work and enterprise that the Government are trying to promote, but the kind of close family relationships that we are all keen to support. It is therefore with great sadness that I have to say that many of the Bill's proposals represent an unwelcome and unhelpful burden for the self-employed and small businesses.
The House will know that, even before the Bill's provisions were outlined family businesses already had to cope with a raft of regulations affecting the employment of staff in a variety of ways. In many senses, small businesses are now not only unpaid tax collectors, but unpaid benefit officers.
I suspect that those who do not run a business or have no direct experience of doing so will assume that the only thing with which small businesses need to concern themselves is compliance with regulations. I wish that were true. In reality, small businesses are required to administer many of the regulations. For example, the stakeholder pension scheme costs small businesses £15 million per annum; the working families tax credit costs them £105 million every year to administer; and the student loan repayment schemes costs them £210 million per annum. The national minimum wage costs £330 million, and that does not include the money that goes into the staff's pockets; it is simply the administrative costs that fall on small businesses. We will now have the cost of administering the new regulations set out in the Bill.
Mr. Kevan Jones (North Durham): The hon. Gentleman says that the minimum wage is a burden on small businesses. Is the Conservative party now opposed to the national minimum wage?
Mr. Prisk: If the hon. Gentleman had listened, he would have realised that my point was about the administrative costs involved. When the Government put forward apparently generous social programmes, they often fail to mention the fact that they do not administer them. The burden of administration falls on small businesses. That is the basis of my criticism.
Mr. Lloyd: This is a fascinating little lecture. The hon. Gentleman has used the minimum wage as an example of the burden of regulation, but my hon. Friend the Member for North Durham (Mr. Jones) was right to suggest that the Opposition now support it. What is the cost to an employer of checking the present rate of the minimum wage and paying it?
Mr. Prisk: The key point with the minimum wage is that the administration of regulations involves not just the process of putting systems in place, but proprietors' time in ensuring that they comply with them. That is the challenge, and I say that as someone who has had the opportunity to run his own business.
The Government's figures for the Bill say that the cost to business will be £369 million in the first year alone. In years two, three, four and for ever after, the costs will be £272 million each year. If that were not enough, the Government have admitted that small businesses will again disproportionately have to bear the brunt of the proposals. [Interruption.] I hope that the Minister for Employment and the Regions is listening.
The Minister for Pensions (Mr. Ian McCartney): My hon. Friend always listens.
Mr. Prisk: It is nice to know that.
Earlier today, the Chancellor said that he intended at some stage to recognise the costs of the working families tax credit on small firms. I welcome that small step, even though I had hoped that he would recognise those costs today. Sadly, he has not. However, given that a precedent has been set, will the Minister for Employment and the Regions advise the House whether he proposes to help small family firms with the cost of administering the proposals in this Bill? I would welcome his comments on that.
Some will say that the proposals in the Bill are driven in part by what comes from the European Union and the social chapter regulations—I think here particularly of the fixed-term contract provisions in clause 45. However, if the Government are simply following EU requests, why have they chosen specifically to include pay and pensions in the terms of the Bill? My hon. Friend the Member for Maldon and East Chelmsford said that pay and pensions requirements are not included in the directive, but they have been added to the Bill. Such gold plating of European legislation is very unwelcome for the simple reason that it puts United Kingdom businesses at a disadvantage. That should concern all Members.
My worry with these over-prescriptive measures is that, in many different ways, they will put our businesses, large and small, at a disadvantage. For the majority of people
who work for decent, small, local family firms, they are an unwelcome and unnecessary intrusion into the good working relationship between employer and employee. Heavy-handed Government interference can only ever be counterproductive in the workplace.The Bill is certainly right to acknowledge the difficulties of balancing work and family life. However, it has not been drawn up with the good of self-employed families in mind. For those 4 million households, the regulations will simply bring additional costs that they can ill afford. The red tape created by the regulations will rob people of many hours that could be better spent with their families or making the business more successful. These measures will also make those who work for small businesses—they currently represent nearly 40 per cent. of all employees in the private sector—more expensive to employ.
For all those reasons, the Bill will hinder some families as much as it will help others. It will deter many local firms from creating the jobs that all families need and, in making family firms pay to run the schemes, the Government are setting self-employed families against their staff. That is why I specifically ask the Minister to give serious consideration to excluding the smallest family businesses from the burdens that the Bill represents. Give them a chance to compete and families the chance to get together. I appreciate the intention behind the Bill but, when we talk about family-friendly policies, we must consider not just those in salaried work but the 4 million self-employed families who play such an invaluable role in local communities and in creating jobs in all our constituencies.
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