Examination of Witnesses (Questions 160-179)
BRITISH CHAMBERS
OF COMMERCE
30 NOVEMBER 2004
Q160 Chairman: There is also a degree
of self-selection in the sense that you can decide whether or
not you wish to send it back.
Mr Sidnick: Yes.
Q161 Chairman: It is no different from
the Daily Mirror asking, "Should Becks stay married
to his wife?" or something like that, so there is a certain
statistical concern about self-selecting samples.
Mr Sidnick: Yes there is, but
when such powerful messages come back—for example the majority
on Minimum Wage, 80% say they want a cap now; on maternity 83%
are opposed to extending payment to twelve months—that sends
a message. You can question the reliability of statistics as always.
Q162 Chairman: Basically what you are
telling us is that you do not really have accurate statistics
about the number of your members who would be affected by the
Working Time Directive opt-out.
Mr Sidnick: Not of our entire
membership but we have a sample.
Q163 Chairman: We have already agreed
that there is a difficulty with the quality of the sample. It
may be that everybody who is concerned has written in and that
is fine, but we still do not know that for sure so that to base
your arguments on samples of this nature is, to say the least,
statistically dubious. You cannot tell me in any accurate way
the number of people who would be affected by the removal of the
opt-out; you just know a lot of people do not like the idea of
having it removed.
Mr Sidnick: It depends on the
way you look at the statistics, but what is true is that the UK
has the strongest economy in Europe and we also have the most
flexible labour market in Europe. Those two together would suggest
that things like the Working Time opt-our and the Minimum Wage
and other regulations do play a role. I think that is the point.
Q164 Chairman: What about Denmark. That
is a small economy admittedly but has very high levels of economic
performance but also has high levels of regulation.
Mr Sidnick: But then you can refer
to the US which has a stronger economy and low regulation.
Q165 Chairman: So you could say that
it is very difficult to draw any conclusions from the information.
Mr Sidnick: I think it is broadly
accepted that if you impose the high levels of regulation there
will be a point where it starts to affect your competitiveness.
Q166 Chairman: All I am saying is that
there are examples—the US one and the Danish one—and
it seems that there are others who might well be struggling for
other reasons altogether.
Mr Sidnick: Yes, that is true.
Mr Toye: The effect of some of
these regulations will definitely change the UK scene in a way
to make it slightly harder and more expensive for business. I
have two female employees pregnant and I have two expectant fathers
which amounts to about 20% of our workforce. We can see the cost
of these regulations. I am pleased that we have this from a paternal
point of view, but if, for example, maternity is extended from
six to 12 months we do see genuine effects on our business.
Q167 Chairman: Have you any idea of how
many employees are already working on average 48 hours a week
or less, extrapolating from your wide-ranging albeit self-selective
sample?
Mr Sidnick: There are some government
statistics on the labour force survey but I do not have those
to hand. It is a sizeable number. I could write to you with those.
Q168 Chairman: What I am trying to get
at is what surprises me is your obsession with this issue. I can
understand parental leave concerns; these are perfectly understandable.
As far as the other ones, I just wonder if it is quite as big
an issue as you would have us believe. I know it is administratively
a pain in the neck—a lot of things are—but this seems
to be an easy target to shoot at rather than a big problem and
the two might not necessarily be the same.
Mr Sidnick: It is the issue that
our business members keep coming back to us on so we take what
they say.
Q169 Sir Robert Smith: What is the response
rate to the survey? One goes to every member of the Chamber through
the network.
Mr Sidnick: Yes.
Q170 Sir Robert Smith: How many come
back?
Mr Sidnick: On this survey 1,200
responded but it is hard to gauge how many were actually sent
out. It is up to each Chamber itself to send it to their members
so we do not have a response rate figure. It is sent to all Chambers
and they send out a certain number.
Q171 Sir Robert Smith: Do they not send
it to all their members?
Mr Sidnick: No.
Q172 Chairman: Is there a method of establishing
who gets sent it and who does not?
Mr Toye: It is a website and we
just get an email; we do not know necessarily what the survey
is about. You just pull up the website and answer the questions.
Q173 Chairman: So first you have to be
on the net; secondly you have to be interested enough to fill
it in; thirdly, surprisingly enough since it is on the web, you
do not keep statistics as to where they come from and which parts
of the country and what numbers?
Mr Sidnick: We do have that; we
know the percentage from each region.
Q174 Chairman: What does that mean, a
percentage from each region?
Mr Sidnick: We do know how many
survey responses each Chamber sends us back.
Q175 Chairman: But you do not know how
many members they have in each region.
Mr Sidnick: Yes we do, but it
is up to each Chamber of Commerce to send it to their members
as they wish.
Q176 Chairman: So it is put out on their
website rather than on the national BCC one?
Mr Sidnick: It is on both and
also a paper version is sent as well. All forms are used.
Q177 Chairman: If you were really bloody-minded
you could do all three.
Mr Sidnick: I would imagine you
would only reply once. I think a survey of 1,200 business does
give an indication of what the current environment is. Our QES
of over 6,000 is the largest survey in the UK, so over 6,000 businesses
each quarter which is reliable evidence.
Chairman: I think we will move on, Mr
Sidnick. All I would say is that if I had to depend on that methodology
for canvassing my constituents at election time I would not have
been here for the last 25 years. That is all I can say.
Q178 Mr Hoyle: You have obviously touched
on the National Minimum Wage and I think like everybody I would
like to congratulate the success of the Minimum Wage since it
has been introduced, but I think now the question is why do you
think organisations feel that it ought to be limited, either capped
or in line with inflation? It is the same sceptics, presumably,
who said that the Minimum Wage will not be successful, it will
be detrimental to businesses, businesses will fold overnight.
That never happened; it still has not happened. What would you
like to say?
Miss Owens: We are not opposed
in principle to the Minimum Wage. When it was introduced in 1999
at £3.60 it was seen as a reasonable rate to have, but rises
in recent years—the last couple of rises at 7.5% this year
and last year—are more than double the average earnings
growth. There was also a rise in 2001 or 2002 of 10%, three times
average earnings growth. It has now got to the stage where many
businesses recruit at a level and around the National Minimum
Wage, and around £5, and those are the businesses that are
saying to us that this is a problem. It is having an impact on
differentials further up the chain and it is also becoming an
issue for employers who do not want to be seen necessarily as
a Minimum Wage employer but may have no choice.
Q179 Mr Hoyle: How does that go and how
do you run it past your own mind when you think 10%, 8% of £4,
yet the same people are saying to you. "We don't like this"
but then having 20%, 25% on £200,000 a year. Do you not think
there is a whiff of hypocrisy in that?
Miss Owens: Our main constituency
of businesses employ between 50 and 100 people. They are SMEs
and obviously dependent on the sector—care home sector,
retail sector, manufacturing sector—and they are employing
people in and around the rate of the National Minimum Wage and
if it is not that now it soon will be.
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