Rob Marris: The hon. Gentleman is generous in giving way. Before I came to the House I helped to run two small businesses, so I have some idea of what I am talking about. Returning to what he said to my hon. Friend the Member for Aberdeen, Central (Mr. Doran), I have to tell him that a survey carried out in the west midlands last year by JBS Computer Services found various factor irking business, but legislation and red tape were identified as a major hassle by only 6 per cent. of respondents.
Mr. O'Brien: On the first point, I can only express deep regret that the hon. Gentleman did not have a hand in drafting the Bill and that he is not on his party's Front Bench, because I dare say that he might have been able to bring some of his experience to bear. No doubt his Front-Bench colleagues will have heard that he hopes one day to be considered. As for any quote that he may have been able to find about any business thinking that red tape or the increasing burden of taxation is not an issue for the future competitiveness of the UK economy, that is the exception that proves the rule, to the extent that it is provable. Every Member to whom I speak is always saying that businesses are concerned about their burdens, the increased cost base for non-operative expenditure and tasks for which they have to create jobs that diminish, rather than increase, the bottom line. Those are the issues about which businesses are concerned and obsessed, and they are right to be so.
Yet again, the Government's interventionist instincts have created a situation in which businesses are suffering under an ever-incoming tide of new taxes and red tape. Before the 1997 election, the Labour party pledged
The British Chambers of Commerce estimates that the Government have added an extra £20 billion of extra regulatory costs to UK business. In addition to regulation, 60 tax rises have been imposed on businesses and the people who work in them. Together, those burdens are damaging our economy and stifling enterprise, job creation and economic growth. The Bill will add significantly to those burdens without making any competitive gains. It is unnecessary, but I suppose that the Secretary of State wanted another Bill to notch up on her tally board to justify her massive Department and its burgeoning £8 billion budget of taxpayers' money.
Mr. Michael Jabez Foster (Hastings and Rye) (Lab): If all that dire history is true and the hon. Gentleman's analysis is right, can he explain why this Government have been so much more successful than previous ones in creating jobs1.7 million since 1997, as we heard the Prime Minister say today?
Mr. O'Brien: I am glad that the hon. Gentleman notes that my analysis is something to be supported, but before he gets too carried away in his fulsome attempts to curry favour with his Front-Bench colleagues he ought to think carefully about disaggregating those figures. Although there are, not least because of the changing conditions of the world economy, extra jobs in new industries and there has been an influx of people into self-employment and small businessesthat is a good thingthere are also more jobs in the public sector. Some of those jobs are in the delivery of front-line public services, and there is of course no difference between the parties in our welcome for new nurses, doctors and so forth, but we do not welcome non-productive public sector jobs.
If the hon. Gentleman looked at the disaggregated figures, he might be shocked to see how much public sector employment is not in the delivery of front-line services or added value for all the extra taxpayers' money being spent. He may also want to consider the serious decline in the number of jobs in manufacturing, traditional industries and those industries that have had to rationalise because of severe world economic conditions. Disaggregation would be a good study for the hon. Gentleman, and I hope that after that he will be able to say that my analysis is not flawed.
David Cairns (Greenock and Inverclyde) (Lab): Given his in-depth study of the figures and the location of those 1.7 million new jobs, can the hon. Gentleman tell us in percentage or numerical terms how many of those jobs are in the private sector and how many are in the public sector?
Having made clear the background to what I consider to be an unnecessary Bill, we must none the less humour the Secretary of State and consider it carefully, examining it for the ways in which it will make UK business more competitive and reduce its costs. That is what she is responsible for in Government, and it is against that set of criteria that she and the Bill should be judged. Surely we and she can and should leave the issues of the workplace to the Secretary of State for Work and Pensions and his colleagues, because he has primary responsibility in Government for those matters. I look to the right hon. Lady to be the champion of what helps UK business to be more competitive, not to load more costs and regulations on it.
The Bill must be assessed for the value to the taxpayer that the Secretary of State and her Government give from that serious £8 billion budget of hers for businessand I mean for business, not against business. She relishes presiding over the Department that, contrarily, is simultaneously the regulator-in-chief against business. In Committee, we, led by my hon. Friend the Member for North-West Norfolk (Mr. Bellingham), will hold her to account for what the Bill does for UK business.
The cumulative impact of the series of minor amendments contained in the Bill to the Trade Union and Labour Relations (Consolidation) Act 1992 and the Employment Relations Act 1999 will be prejudicial to the interests of employers, while strengthening the hand of the unions. To coin a famous Government phrase, the amendments may look to them like merely a tidying-up exercise, but looking at them in their totalityanother famous phrasethey represent an understated but concerted shift in the balance of power between employers and unions achieved in the previous legislation.
To highlight a few examples, it is proposed in the Bill that unions should give an entitlement to vote in an industrial action ballot only to those members whom they believe may be "induced by the union" to take part in the action. Protective rights against disciplinary action will encompass "workers", instead of just "employees". Will the Minister clarify in his winding-up speech whether the wider definition will include agency workers and subcontractors? The distinction between workers and employees will be a serious issue. In response to the European Court of Human Rights ruling in July 2002 on the Wilson and Palmer cases, employers will no longer be able to offer inducement to workers not to join a union, punishable with a fine of up to £2,500. We wait to examine that in detail in Committee.
The second main aspect of the Bill emanates from the DTI's twin regulator-in-chief, the European Union. It has been argued that there is "no need" for the information and consultation directive establishing
The directive, developed, as the Secretary of State said, in consultation with the Government, the TUC and the CBI, seeks to establish a framework giving employees the chance to be informed and consulted on management decisions affecting their future. The measure sounds well meaning enough, but it is of dubious necessity. A study conducted by the Institute of Directors in 1998 found that 85 per cent. of directors already had in place communications arrangements with their staff.
The cost of implementing the directive looks damaging, particularly for medium-sized businesses. The best-case scenario presented in the consultation document for the non-recurring costs and the present value of recurring costs over a 10-year period for medium-sized businesses would amount to £258 million. The IOD have said that the total cost to business over the same period will be an even more eye-watering £430 million. That is backed up by a survey by the Birmingham chamber of commerce and industry, which found that 76 per cent. of respondents were concerned about the increased costs for their businesses as a result of implementing the regulations. I am sure that the hon. Member for Wolverhampton, South-West pays close attention to that organisation, given the points that he made earlier, and he may well want to follow its survey through. [Interruption.] The hon. Gentleman says he hopes I am always happy to listen to what he says. Indeed I am.
I agree with the Secretary of State's colleague and fellow Minister, Lord Sainsbury. The implementation of the directive through the Bill is simply the imposition of new European work rules that dictate how UK bosses should run their businesses. The directive would interfere with business decision making and introduce over-the-top rules in the workplace. I shall give an example from experience that all of us have been through and which I went through it particularly when I was in business.
When the question of consultation on European works councils came up, there was a massive amount for everyone to think about. Firms such as the one in which I was involved had to qualify. What mattered was the meaning of the word "consultation". It does not matter whether it is in French or any other language. The question is what people mean by consultation. We know
Interestingly, the European model, which everyone thinks is the great Jerusalem in terms of what consultation means, is the opposite in practice. The word is widely used in Europe and there are the most convoluted structures for co-determination, but, there, consultation is understood to meanthis is why European works councils were perfectly satisfactory"We want a forum for an exchange of views, but we recognise management's right to decide". That has not characterised the word in this country. It has always been a demand for much greater sharing than has ever been the case on the European continent.
The word has been so widely misunderstood that I had to put that on the record. When the information and consultation directive is mentioned, the word "consultation" carries so much more hope and expectation for people who make the argument in this country than has been the case in the European model from which it derives. We all live in the same competitive marketplace. Jobs are not sustainable unless we win those orders and keep those jobs. That is why we must understand the comparison.