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The Minister for Work (Jane Kennedy): I join other hon. Members in congratulating my hon. Friend the Member for Jarrow (Mr. Hepburn), both on his good fortune in achieving a high place in the ballot and on his wisdom in choosing to raise the important subject of company directors' legal responsibilities for health and safety. I congratulate him, too, on the weight of support that he has received in this morning's debate. It is a great pleasure to follow my hon. Friend the Member for Northampton, South (Mr. Clarke), and I wish his company success in all its endeavours.
I depart, however, from the majority view in one important respect, as I do not agree that the law as it stands is failing to work. Legislation can always be improved to make the workings of the law more effective, but we must discuss whether the Bill is the appropriate vehicle for doing that. I sympathise a great
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deal with hon. Members' general comments, but they will broadly agree that we already have a health and safety record of which to be proud. In recent years, there has been much progress, which is the result of the hard work and dedication of the Health and Safety Commission, the Health and Safety Executive, employers, workers, lobby groups, and of course the trade unions. I congratulate and thank everyone who has contributed to that improvement in the health and safety record.
The House, however, will know that deaths and injuries continue to occur. Every death is a tragedy, and even one is too many. Indeed, only a fortnight ago, two construction workers were killed at a school building site when a crane collapsed on top of them. We must therefore strive constantly to drive up health and safety standards. Last week's construction health and safety summit was attended by the chief executives of some of the UK's biggest construction companies as well as trade union general secretaries in the field. They acknowledged that progress has been made but that, as has been argued today, much more could be done. As hon. Members will be aware, it has been the Government's long-standing policy to encourage all employers to take responsibility for ensuring that risks to their employees' health and safety are properly controlled. We consider it essential that boards of directors in all sectors and in organisations of all sizes play their part by providing the necessary leadership and direction to ensure the health and safety of their employees and of people affected by their activities.
There is evidence that a growing number of boards of directors have taken responsibility for health and safety and are providing the necessary leadership. There are differing views, however, about the speed of that progress. I acknowledge that in a significant number of organisations—one in six, it is estimated—boards have not taken on that vital responsibility and have indicated that they have no intention of doing so, so there is more progress to be made. We are doing a great deal already, and it is not all about legislation. A key theme of the Health and Safety Commission's workplace strategy is helping people to understand and benefit from sensible health and safety policies and practices. I agree with the hon. Member for Daventry (Mr. Boswell) about the business as well as welfare benefits that flow from sound health and safety practice. That includes publicising examples of best practice, the benefits of board-level corporate responsibility and the persuasive evidence of the benefits, both economic and social, of director leadership.
We have evidence that the guidance issued by the Health and Safety Commission in 2001 on directors' responsibilities has had an impact in raising the profile of health and safety at board level and in changing director behaviour. The Government welcome the recent action by the commission to make the case for director responsibility and leadership more persuasive. The House may be aware that the Health and Safety Executive recently published a series of director leadership case studies containing powerful messages about the social and business benefits of such an approach.
We are sure that the case studies, drawn from the private, public and voluntary sectors—employers such as Esso, Anchor Housing Association and Buckinghamshire
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county council—will attract considerable interest among peer organisations and will drive improvements. The Government will study carefully the impact of those and other measures in persuading reluctant directors to take responsibility.
Legislation is already in place covering such matters. The Government expect company directors to be fully aware of their legal duties and to discharge them seriously in the interests of their workers, customers and shareholders. The Health and Safety at Work, etc. Act 1974 imposes requirements, which are relevant and have an impact on criminal liability. Under sections 36(1) and 37, directors can, in specific circumstances, be found personally guilty of a health and safety offence in their capacity as directors in addition to the company being liable corporately. My hon. Friends have referred to that and have drawn attention to the low number of prosecutions. Under Section 7 of the 1974 Act a director may, in specific circumstances, be found guilty of an offence in his capacity as an employee.
The Government, the Health and Safety Commission and the executive would expect company directors to be fully aware of the criminal liability that they already face and to ensure that they and their companies discharge their statutory duties seriously. The commission's enforcement policy statement, published in February 2002, states that
"when the enforcing authorities are investigating possible health and safety offences, they should consider the management chain and the role played by individual directors and managers. Enforcing authorities should take action against them where the inspection or investigation reveals that the offence was committed with their consent or connivance or"
The Health and Safety Commission and the executive are monitoring the impact of that policy statement on investigation and prosecution decisions in cases undertaken by the Health and Safety Executive.
Mr. MacDougall: Does my right hon. Friend agree that given the number of Members of Parliament who hold directorships, a decision today would send an important message of leadership in support of the Bill?
Jane Kennedy: Yes, not only would a message go out from the House but many of the relatives of those involved in those cases described to us this morning—they attended a reception last night—will be listening to the debate and watching our actions in this House. We must all stand accountable for the decisions that we take.
The Health and Safety Executive's health and safety offences and penalties report 2003–04, which is its most recent report, stated that the executive prosecuted 17 directors and managers of which 11 cases resulted in convictions. That is fewer than during the previous year, and the executive believes that that suggests progress rather than failure under the existing legislation.
A sanction of disqualification of company directors is also available to the courts under the Company Directors Disqualification Act 1986 and I assure the House that that power has been and will continue to be used. However, there are further calls for more
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legislation covering directors' duties involving health and safety, often with the backing of the trade unions, and the Bill promoted by my hon. Friend the Member for Jarrow is an example. I accept his comment that the weight of opinion in support of the Bill goes wider than the trade union movement, important though that is.
I referred at the opening of my remarks to the weight of opinion that has supported my hon. Friend's Bill. He has drawn into the Chamber for this debate experienced colleagues from throughout the House, including colleagues who have an experience of agriculture, the offshore oil industry, the construction industry and the mining industry. The right hon. Member for Bromley and Chislehurst (Mr. Forth), who has a distinguished record in the House as a Minister, has the experience of working for Ford, and therefore knows the manufacturing industry extremely well.
I assure my hon. Friend and supporters of the Bill that the Government are not deaf to these representations. I accept that the debate on the need for further legislation on directors' duties is an extremely important one, not only for directors who bear responsibility but for all workers and their families. It is one that is firmly on my agenda, as my hon. Friend knows.
The hon. Member for Gordon (Malcolm Bruce) described a case where regret was expressed by the sheriff that there had not been a heavier penalty available to him to impose. There are other occasions when my hon. Friends would probably join me in bemoaning the fact that the courts too infrequently impose the maximum penalties that are available. Cases have been described to us where the fines imposed have been at the lower end of the scale that is available to the courts. It makes a great impression on those of us who listen to the representations being made when it is reported to us that it is those in charge of the courts who are commenting on a lack of more severe penalties.
My right hon. Friend the Member for Newcastle upon Tyne, East and Wallsend (Mr. Brown)—it is a great pleasure to share this debate with him, and I know that he took a great interest in these matters when he held the post that I am now privileged to occupy—made some forceful comments. Indeed, he makes forceful representations outside this place, which have not been lost on the current holder of the post that he once occupied. He made a thoughtful and telling contribution, as did my hon. Friend the Member for Manchester, Central (Tony Lloyd).
The right hon. Member for Bromley and Chislehurst asked us to consider whether it would be possible, if the Bill were to become an Act, that those lower down the chain of authority might feel that some of the responsibility had been lifted from their shoulders. I think that there would be some hollow laughter if that were to be the effect of the Bill. The point has been made that a higher proportion of those who are prosecuted now seem to be at the lower end of the responsibility chain within management.
I was interested to hear about the former experience of my hon. Friend the Member for Chatham and Aylesford (Jonathan Shaw). I, too, was a care assistant. Far too many workers in the public sector, too, are left
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to learn safe practices by watching colleagues and emulating them, rather than learning from a structured programme of instruction on safe working practices.
We accept and recognise that a change in the law as proposed in the Bill may well assist prosecutions of errant directors of large companies. However, it is far from clear what improvements in health and safety would result from the proposed changes. We must be sure that such a change in the law would have a major impact on reducing injury and ill health in the workplace. At present, we do not have that confidence.
Reference has been made to the recommendations contained in a report of the Work and Pensions Committee's health and safety inquiry, calling on the Government to introduce proposals for pre-legislative scrutiny during this Session. In our response, we stated firmly our belief that there is already an appropriate balance of legislative and voluntary responsibility on directors in relation to occupational health and safety. We asked the Committee to note that we had no immediate plans to legislate as recommended. However, this might be an appropriate moment to say that we have a firm intention to legislate on corporate manslaughter and Crown immunity—two sides of the same coin—and the Bill will be published shortly.
The evidence to the Committee made clear the contentious nature of the research findings on what motivates directors to take responsibility for and to provide leadership on health and safety. We appreciate the views of those who consider further legislation and regulation as the only real influence on motivating directors to take responsibility, but we need to be convinced that making directors more liable to prosecution is one of those key motivators.
Will my hon. Friend the Member for Jarrow consider the regulatory impact of his Bill? When framing new law we must be clear about its costs and benefits, and we would be interested to know what, if any, information he has on that. Several hon. Members have referred to the fact that the Bill deals with the biggest companies, corporations and institutions in the UK. It is worth noting that fewer than 8,000 companies would be affected by the Bill's requirement to nominate a health and safety information director. It requires only large companies to appoint such a director. According to the DTI's figures, the UK has some 3.7 million businesses, of which 99.8 per cent. are defined as small and medium-sized, all of which are excluded from that requirement.
Hon. Members will also be aware that the Government, in their response to the Committee, reported that we have asked the Health and Safety Executive to undertake a further evaluation to assess the effectiveness of current measures on director responsibility. We have asked it to review all the available evidence and to report its findings, together with recommendations, by December 2005, and that work is under way. My right hon. Friend the Member for Newcastle upon Tyne, East and Wallsend described the good and healthy working relationship between the Health and Safety Executive and Commission and Ministers, such as he and I, who exercise the relationship between Government and the executive and commission. It is the executive and commission's firm view that the balance of the legislation is broadly right. However, the Government never seek to duck the opportunity to test our policy against firm arguments
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such as those that have been advanced today. The Government are not able to support the Bill, but neither shall we oppose it.
12.43 pm
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