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Mr. Mike Weir (Angus) (SNP): I understand what the Secretary of State says and very much support the Bill, but one small group—those who have a family by means of surrogacy—has been missed out, and I have taken up a constituency case with Ministers in the light of employment relations. The Bill covers only natural birth and adoption. Will he consider including that small group within the ambit of the rights?

Alan Johnson: I would be prepared to consider that again. We found some complications with it, but there is every opportunity to look into that in Committee.

Providing genuine choice is important for the individuals concerned and for the companies for which they work, but it is also important for the country's
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continued economic prosperity. The Government are determined to increase the proportion of people in work from 75 per cent., which is the highest of any G7 country, to 80 per cent., a level achieved only in Iceland—that is the country, incidentally, not the retail outlet.

The so-called family-friendly agenda, which has a crucial economic dimension, was neglected for too long. When we came into power in 1997, a father could watch the birth of his child in the evening and be compelled to go to work the next morning. We established the entitlement to paid paternity leave for the first time in this country.

Norman Lamb (North Norfolk) (LD): Will the Secretary of State give an idea of the current take-up of the entitlement to two weeks' paternity pay? There is a great deal of concern that because the pay is quite low, and because of the straitjacket in terms of notice requirements and so on, the take-up is low.

Alan Johnson: I do not have the exact figure, but take-up is encouraging and high. The matter does not relate just to those people taking paid paternity leave under legislation, but to the number of companies that accept that paternity leave should be a normal part of employment rights. Many companies that have had arrangements for maternity leave have their own arrangements for paternity leave. I shall ensure that the hon. Gentleman gets the correct figure, perhaps during the wind-up, but it is encouraging.

In 1997, a working mother could receive a phone call from school saying her child was ill and her employer could still insist that she stay at work. We introduced a right to time off to deal with family and domestic emergencies. In 1997, adoptive parents—incredibly—were given no help whatsoever, despite the huge benefits to society of taking children out of institutions and placing them in a loving family environment. We have given adoptive parents broadly the same rights to pay and leave as natural parents. In 1997, paid maternity leave was 18 weeks. By the end of this Parliament, it will be 52 weeks. In 1997, maternity pay was £55 a week. Today, it is £106 a week.

Mr. Mark Prisk (Hertford and Stortford) (Con): The Secretary of State rightly suggests that the Bill should be about fairness. Is it fair that families who run small businesses should have to pay for the administrative costs of the changes that he is trying to implement?

Alan Johnson: In terms of maternity leave, the hon. Gentleman well knows that small businesses get 104.5 per cent. reimbursed, unlike larger companies. He was a distinguished member of the Committee that considered the Employment Bill. We also increased the level of national insurance contributions that determines the 104.5 per cent. so that more small firms managed to benefit from it. We have been meticulous in trying to keep the cost of the arrangements to an absolute minimum. In terms of maternity leave and its extension, we have introduced, as small businesses wanted us to, various arrangements to give practical assistance.
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Mr. Prisk rose—

Mr. David Burrowes (Enfield, Southgate) (Con) rose—

Alan Johnson: I want to make one final point.

In relation to paternity leave, we are taking a power in the Bill. We intend to consult widely on the regulations to enact that. A large part of that will be to determine how small businesses are affected.

Mr. Burrowes: Although small businesses can reclaim contributions, does the Secretary of State appreciate the significant impact such leave has on them? As 95 per cent. have five employees or fewer, the loss of manpower and skills could be considerable. Although much in the Bill is to be credited, many might interpret it as tokenistic. A true family-friendly policy should be within the taxation system, to give proper recognition of single-earner households and to benefit them.

Alan Johnson: I do not accept that. Interestingly, the hon. Gentleman mentions manpower, so I presume he is talking about paternity leave. We do not initially expect a large queue of people waiting to take the leave. We think that it will apply to 16,000 to 18,000, and about one in 700 small businesses will be affected every couple of years. It is unlikely to have an enormous impact.

I want to stress the positive impact on the employment market and small businesses in particular. Many small businesses, including a small business man, Simon Topman, helped us to shape much of what we have done on work-life balance since we came into power. It is about ensuring that small businesses do not lose valued members of staff. People, usually women, found it difficult to balance their working life with their domestic requirements. Many small businesses have been pleased that the legislation has been implemented because it helps to retain staff.

Several hon. Members rose—

Alan Johnson: I shall give way to the hon. Member for Buckingham (John Bercow).

John Bercow (Buckingham) (Con): I have just taken a short and enjoyable period of paternity leave and I might plan to take some more, to the obvious and understandable delight of the Whips. With reference to the secondary legislation provided for in clauses 3, 4, 5, 6, 7, 8 and 9, will the regulations be subject to the negative procedure of the House or to its affirmative counterpart?

Alan Johnson: The regulations will be subject to the affirmative counterpart.

John Bercow: Excellent.

Alan Johnson: Although we would all miss the hon. Gentleman when he goes on paternity leave, I hope that he takes it.

Alison Seabeck (Plymouth, Devonport) (Lab): To return to the point made by the hon. Member for
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Hertford and Stortford (Mr. Prisk), does my right hon. Friend agree that small businesses benefit from offering flexibility to their staff, because they might otherwise lose experienced staff whose replacements would be expensive to train? The logic behind the provision is that by offering staff flexibility, a business retains their skills.

Alan Johnson: My hon. Friend is absolutely right. In fact, the average cost, for example, of the right to request flexible working is £80 whereas the average cost of recruiting a new employee is £4,800.

Mr. Tobias Ellwood (Bournemouth, East) (Con): I am concerned about the Minister's statements on how the measure will affect small businesses. Is he not worried that if more burdens are placed on small businesses, they will design their work force to avoid the people who   might receive paternity and maternity rights? [Interruption.]

Alan Johnson: As the chorus behind me is pointing out, that would be illegal. The hon. Gentleman makes the argument that we heard when we introduced the right to request, when we introduced the national minimum wage, when we introduced adoptive leave—in fact, on every occasion when we have tackled that agenda. Conservative Members such as the hon. Member for Buckingham (John Bercow) and the right hon. Member for Maidenhead (Mrs. May) recognise that it is an important agenda. It is about time their party adopted a positive approach to it. As soon as we get anywhere near setting up decent, civilised, minimum standards in the workplace, we hear a chorus of, "This will reduce people's ability to recruit staff." Yes, that is a crucial concern that needs to be tackled and we have tried very hard to ensure that it is, with some success.

Helen Jones (Warrington, North) (Lab): In addition to emphasising the benefits to small businesses of the measures in the Bill, will my right hon. Friend resist the siren calls to deal with the matter purely through the tax system, which is a regressive way of dealing with it? Maternity rights and benefits have benefited a lot of low-earning families and dealing with the matter through the tax system will benefit only those who can afford to live on one wage.

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