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Mr. David Atkinson (Bournemouth, East) (Con): I noticed that Labour Members jeered my right hon. Friend when she referred to her local business that

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makes do-it-yourself wallpaper-stripping machines, but some of them should realise that the reason why that factory is still in operation in her constituency is that it meets orders on time when they are required. Hon. Members with similar businesses in their constituencies know that many of them have disappeared to China, which has more flexible working.

Virginia Bottomley: My hon. Friend could not have given me a better lead-in to my subsequent point. In the introduction to the Bill, the Department of Trade and Industry talks of wanting to encourage employers and employees to work together to produce a "no surprises culture" at work, but that is incredibly naive in the present business environment. Having recently returned from Singapore and Hong Kong—on the other side of the world—I am talking a great deal about the move to offshoring. We are seeing many aspects of business going that way—in India and eastern Europe, for example. The competition now comes not just from the European Union or the United States, but from the whole world. The reason why companies invest in the UK has always been our flexible labour market and low labour costs.

I hope that my hon. Friend the Member for Bromsgrove (Miss Kirkbride) will be in her place later because her responsibilities for culture, media and sport mean that she talks to people in the creative and film industries. They all say that the precise reason for avoiding working in the UK for many years was the lack of labour flexibility, which is essential if we are to win the jobs, win the work and be a magnet for inward investment. A recent report worryingly showed that foreign investors are not choosing the UK. We have gone from third to 14th as the choice for inward investment, so it is not just a question of how we want people to be treated or what we would like to happen. We have to be hard-headed as well, and create a climate in which people will want to make Britain their destination of choice for investment.

Jim Sheridan: The right hon. Lady spoke earlier about when she conducted negotiations with the health service unions. I have to say, having spoken to the people who had to deal with her at that time, that they regarded her as a very difficult Minister to deal with. Given her earlier denial of women's rights, it is hardly surprising that they drew that conclusion.

Virginia Bottomley: I suggest that the hon. Gentleman take some advice on that point. If he does, he will find that he is completely wrong. I still see many of the trade union leaders with whom I worked then, and I continue to have harmonious relations with them. Forgive me: former Ministers always talk about what they did years ago, but I was greatly involved in ensuring that the Department was part of Opportunity 2000 and I did a great deal to ensure that black and ethnic minorities were better treated in the health service. If the hon. Gentleman has contrary advice or opinion, will he please write and let me know? He may be surprised on that particular matter.

The Bill gives the wrong message about the priorities for this country at this moment. They may be the Government's priorities, but they are not ours. We must look with a broader perspective at the reasons for

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investing in Britain. Britain must have a flexible labour market, and it must be a good place to do business if we want to create the welfare and services that are important to us all. I have no hesitation in opposing the Bill.

2.57 pm

Tony Lloyd (Manchester, Central) (Lab): First, I find it astonishing to hear the right hon. Lady say that good labour relations are not the business of Government. That is essentially what the legislation is all about. I shall comment on its deficiencies—

Virginia Bottomley: Will the hon. Gentleman give way?

Tony Lloyd: Yes, but let me make this point. I shall not ignore the deficiencies, but I have no doubt that it is hugely important to bring a Bill before the House that deals with good labour relations. That subject should unite us, even if we disagree about the mechanics.

Virginia Bottomley: Simply, I hope that I made it clear that I view good relations between people working in an enterprise as essential. However, I believe that it should be a matter of best practice, not coercion, and nor should it be dominated by the Government or Brussels.

Tony Lloyd: The right hon. Lady is a gentle soul, and I am not unkind enough to pursue that matter further.

The debate today seems almost surreal; I think of the debates on labour relations that used to rock this Chamber, and the class warriors who used to inhabit the Front Bench when the Conservatives were in government—people such as the right hon. and learned Member for Folkestone and Hythe (Mr. Howard), the present leader of the Conservative party. He was a man who had a good eye for the jugular and a good lawyer's voice to make the case. He was the man who came out with the phrase to the trade unions that one man's pay increase is another man's job loss. That was the hallmark of employment relations in the Howard period, yet I hear no echo of that today.

I listened for nearly an hour to the hon. Member for Eddisbury (Mr. O'Brien), the Conservative Front-Bench spokesman, but I cannot tell what he is for or against on employment issues. I cannot even tell what he is for or against in the Bill, and I cannot tell what he believes about labour practices in Britain. I know that he is against regulation and red tape and in favour of flexible markets, but I cannot tell what that means for the Bill or what it says about employment policies when the Conservatives were in power.

The new Opposition Front-Bench team has made no statement about labour relations. When the new leader of the Conservative party was Secretary of State for Employment, he chided Labour plans for the minimum wage. I remember that he used to ratchet up the going rate for the number of jobs that would be lost by the minimum wage. It started at half a million, then rose to a million, and his final bid was that the minimum wage would destroy 2 million jobs.

Opposition Members are quiescent on that subject now because they know that the Labour Government have achieved a more harmonious climate in labour

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relations, and that jobs have grown at a much faster rate than was the case in even the best period under the previous Conservative Government. Overall, in the period of deregulation, that Conservative Government destroyed job after job after job.

Gregory Barker: Has the hon. Gentleman forgotten the extraordinary transformation in labour relations that took place in the 18 years of the previous Conservative Government? In 1979, the number of strike days was colossal, and the Conservative Government cut that number massively. Relations between labour and management improved tremendously, and productivity rose too.

Tony Lloyd: The hon. Gentleman needs to consider the real tests in this matter. For example, the rate of job formation has been better under this Government than at any period under a Conservative Government. The previous Conservative Government were mainly a job-cutting Government. The hon. Member for Eddisbury tried to pretend that public sector employment had become overblown, but that is a myth. This Government can be proud of the number of private sector jobs that have been created. Under the previous Conservative Government, my constituency was made into a black spot for mass unemployment, but that problem has been eased. As a result, some of the social pressures have been lifted, although problems still remain.

The hon. Member for Eddisbury did not talk about the Bill, but that is what I intend to do now. Like other Labour Members, I am pleased with a number of the measures that it contains. There is no doubt that the Bill is important when it comes to tidying up existing practices, and it also deals with other matters that require legislation.

It is not an example of onerous regulation to require companies to talk to their work force. For instance, Vauxhall destroyed many jobs in the constituency of my hon. Friend the Member for Luton, North (Mr. Hopkins), and made the announcement over the public radio system. Companies have a duty to talk to workers, and communicate directly. That is what the best practice is all about. It is not ridiculous that companies should consult their employees on a regular basis. Conservative Members want to promulgate the myth that information and consultation lead only to job destruction. There have been periods of job destruction in this country but, fortunately, they are not the norm. Consultation should be conducted every day: that is what good managers do.

Although I welcome the framework agreement negotiated between the TUC and the CBI, which the Government sponsored, it does not go far enough, as the cut-off points that it contains do not relate to the need for information and consultation. I can think of no reason why employees and managers in much smaller firms should not talk to each other and consult properly, as that would improve the climate of industrial relations. I hope that, over time, we can persuade my Front-Bench colleagues to extend the provisions of the Bill more rapidly than is currently foreseen, or even into areas that are not planned at present.

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I very much welcome the announcement by my right hon. Friend the Secretary of State today that measures will be introduced to deal with the growing problem of infiltration of trade unions by members of the Nazi and neo-fascist movements. That is an insidious and very unpleasant process. There are not many such people, but they do massive damage to our democratic institutions, such as trade unions, which exist to represent ordinary people. I am very pleased that the Bill will allow people who abuse our trades unions to be disciplined. That is a very important step forward.

I also welcome the enforcement of the national minimum wage. It is important that we make every effort to ensure that employers who refuse to co-operate with the law—let alone to observe their moral obligations—are brought to book. The minimum wage is the basic decency threshold, and all employers must play a part in applying it. Those who cheat the system and their employees are not engaged in a great competitive attack on red tape: they are simply people who rob others of their entitlement. If we can bring such employers to book, that will be an excellent achievement.

My colleagues on the Front Bench have heard already today about unfair labour practices. There has been a serious and dangerous growth in abuse of the codes of practice and legal framework for union recognition. Many unions attest to experiencing problems, and hon. Members will be familiar with the big and celebrated cases such as those involving BskyB, T-Mobile and Culina Logistics. However, the same problems crop up in small and unrecognised companies. Workers are bribed to refuse the balloting process, and in that way frustrate colleagues who want to be represented by trade unions.

Under the law, companies have to offer unions the opportunity to communicate with the work force. However, they often increase pay rates to those employees who do not attend those sessions. That is another example of how the democratic process is being frustrated. We should put an end to such practices.

I wish to bring to the House's attention the case of Mission Foods in Coventry. The company is based in the US—[Interruption.] I shall ensure that the hon. Member for North-West Norfolk (Mr. Bellingham) gets the exact details, so that he is able to communicate with the union busters. Mission Foods employs about 190 people in Coventry. The employees made a move to secure recognition under the statutory process, but the company spent a lot of time trying to prevent that. The company brought two people over from the US, whom they employed full time to work on the employees and halt the recognition process.

During the 20-day open period, when the trade union involved—the ISTC—was able to consult with employees, the company employed seven people to work on employees. The company sent employees a video tape urging them to vote no in the ballot. The video was libellous, and will be considered by the courts to determine whether it was legally defamatory. The company also accused the union of having no right to speak for the workers, and of being involved in the closure of sites where it had represented workers in the past. All those accusations were ridiculous and unfair, but I am sorry to say that they succeeded: the ballot was lost by 77 votes to 74.

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That result brings no credit to Mission Foods. The union-busting tactics imported with their employees from the US frustrated the spirit of the union-recognition legislation introduced by this Government. I urge my Front-Bench colleagues to accept that, unless such practices are stopped now, they will become increasingly common.

My right hon. Friend the Secretary of State made some important remarks about her concerns with regard to union-busting activities. However, we will regret it if we do not nip such practices in the bud now. I hope that, as the Bill proceeds through the House, she will consider whether it would not be sensible to introduce a clause dealing with unfair labour practices; otherwise, I fear that it may be some considerable time before we have another opportunity to bear down on such operators.

I want to return to the still vexed question of the 40 per cent. limit in respect of the number of people who must vote for union recognition before that recognition is granted, and of the so-called small-firm cut off of 20 employees or fewer.

Those tests are unfair to trade unions. The 40 per cent. threshold has no basis in any other sort of election. My hon. Friend the Member for Warrington, North (Helen Jones) asked earlier how many of us would have been elected if we had had to have the support of 40 per cent. of those eligible to vote. These Benches would be denuded if we had to meet such a high and unfair test. I urge Ministers to think again, because those tests frustrate the rights of individuals. It is not an issue of trade union rights, but of the right of employees to be represented by trade unions—a fundamental difference, and one that the Conservative party has never understood. Individuals have rights and when a majority of employees vote to be represented by a trade union, it should be accepted under the common norms of any democratic system.

I hope that my hon. Friend the Minister will also hear the message that we need to reconsider the 20-employee cut-off. It is grossly unfair and discriminatory as a matter of principle. It is not reasonable or logical that an employee in one firm should not have the same rights as an employee in another firm. It is not only a matter of principle, but of practicality. We know that small firms lag behind large firms on issues such as equal pay and health and safety. We also know that trade unions make a difference in those areas. Women are predominantly employed in small firms. My right hon. Friend the Secretary of State has an exemplary record on family-friendly policies and enhancing the rights of women in the workplace, so I ask her to look again at those provisions, which will be counterproductive and work against the very results she wants to achieve, which are better rights for the most vulnerable people in our work force—women employed in small firms.

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