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Hon. Members raised various foreign policy issues, to which I should like relatively briefly to respond. The shadow Foreign Secretary raised the matter of EU sanctions against Burma, whether they would be imposed properly and whether we would go further. The sanctions against Burma are already the EU’s toughest autonomous measures against any country and were renewed for a further 12 months, until 2010, by member states in April. The UK continues to believe that further targeted financial sanctions would increase pressure on the regime. The EU common position allows for the revising or reinforcing of sanctions to be considered in response to
actions by the regime. We are not aware of any instances of complaints about the operation of the sanctions, and we are keen to ensure full implementation, through the Treasury and the Department for Business, Innovation and Skills in this country.
The right hon. Gentleman also raised the issue of Serbia. The Government welcomed Serbia’s signature of the stabilisation and association agreement with the European Union last year. The Government are keen that the ratification of the agreement should be conditional on Serbia’s full co-operation with the International Criminal Tribunal for the Former Yugoslavia. In particular, it is obviously important that the outstanding suspected war criminals come to trial. We want to ensure that that happens. The Government would be content, on the basis of Serbia’s significantly improved co-operation, for the EU now to implement Serbia’s interim agreement with the EU.
The hon. Member for Rayleigh asked about Russia and Georgia. Obviously, there are significant issues relating to those countries that we want to pursue, but if he does not mind, I will write to him later to clarify the precise nature of the points that he raised.
Other hon. Members raised various issues, including the question of whether Mr. Barroso’s appointment would be made legally binding. That can be done only when there has been a vote in the European Parliament; that is part of the process.
The hon. Member for Kingston and Surbiton mentioned the Lille loophole. That loophole has already been closed—
Chris Bryant: Yes, it has. I travelled on the Eurostar from Paris last week, and I know that there are British border controls wherever people can get on a Eurostar train.
On climate financing, we need to press hard for a deal in Copenhagen in December to secure the 30 per cent. reduction in emissions by 2020 that I am sure the vast majority of hon. Members want to see. Several hon. Members on both sides of the House raised this issue, and I hope that they will be reassured to know that we will be pushing the Swedish presidency to ensure that we move forward on it. There can be few in the European Union who would doubt that we are the most rigorous of all the EU countries on this issue.
My hon. Friend the Member for Birmingham, Edgbaston raised the matter of the extra seat that we would get if the treaty of Lisbon were to be ratified by all member states. According to existing UK legislation, where that seat would go would be decided by the Electoral Commission, and we would obviously introduce any additional powers that it needed in that regard.
The hon. Members for Spelthorne and for North Dorset spoke powerfully about the Council of Europe, and there is not much that I can add to their comments.
However, we heard a great deal of nothing from the Conservatives about their policy on Europe. The most interesting thing of all was the charming image of the Billy-no-mates charabanc that has been touring Europe over the past couple of years. Billy got his knapsack on his back and a baseball cap on his head to protect himself from the sun. He abandoned all his influential
friends who were running Germany, France and Italy. He did not bother to go on the grand tour of the big cities—oh no! He travelled not the highways but the byways to find new friends. He did not go to France, Germany or Italy. He let on board his faithful charabanc only the
“fascists, outcasts and ne’er-do-wells”.
Those are not my words; they are the words of Struan Stevenson, a Scottish Conservative Member of the European Parliament.
It is interesting that the Conservatives are not prepared to tell us which parties will be joining them on their joyful little day out. Will they include the Polish Law and Justice party? One of its members says that homosexuals should not be allowed to teach, while another says that the affirmation of homosexuality will lead to the downfall of civilisation. The right hon. Member for Richmond, Yorks and the hon. Member for Rayleigh are both sitting there smiling now, but I think that one of the reasons why they are happy to have that party alongside them is their own voting record on these matters. That applies especially to the hon. Member for Rayleigh, who has never in his life voted for a positive measure on homosexual equality in this country.
There was another party that the Conservatives wanted to get on board: Alternativa Española, the new, far-right party in Spain— [ Interruption. ] The hon. Member for Rayleigh is now saying, “Oh no we didn’t”, but his friend, the MEP Daniel Hannan, was certainly spending a good deal of time trying to persuade people to vote for Alternativa Espanola in Spain, even though it has several of Franco’s original party members signed up to it. It also signed up to the Vienna declaration. No wonder the right hon. and learned Member for Rushcliffe (Mr. Clarke) thinks that this outing by the right hon. Members for Witney (Mr. Cameron) and for Richmond, Yorks is nothing more than “head-banging”.
The other thing that I found a bit depressing was that we heard not Hague the wit, but Hague the vague this afternoon. Let us compare that with his great, statesmanlike pronouncement that
“we would not let matters rest there”.—[ Official Report, 12 November 2007; Vol. 467, c. 423.]
“We would not rule anything in or out”.
We have heard that again and again this afternoon, although he could not say it with a straight face. He was smiling all the way. His great pronouncements, full of insight and clarity, also include:
“We will have among our major goals the return of social and employment legislation to national control”.
That sounds like the renegotiation of a treaty, despite the fact that the shadow—
10 pm
Motion lapsed (Standing Order No. 9(3)).
Statutory Redundancy Pay (Amendment) Bill (Money)
Queen’s recommendation signified.
10 pm
The Parliamentary Under-Secretary of State for Business, Innovation and Skills (Ian Lucas): I beg to move,
That, for the purposes of any Act resulting from the Statutory Redundancy Pay (Amendment) Bill, it is expedient to authorise the payment out of money provided by Parliament of any increase attributable to the Act in the sums payable under any other Act out of money provided by Parliament.
This money resolution is required in respect of clause 1 of the Statutory Redundancy Pay (Amendment) Bill, promoted by my hon. Friend the Member for Chorley (Mr. Hoyle). The Bill received its Second Reading on Friday 13 March and is likely to commence its Committee stage on Wednesday 24 June. In accordance with convention and as part of the parliamentary process, any Bill likely to incur additional public expenditure requires a money resolution.
This Bill proposes linking statutory redundancy pay limits to the level of average earnings. Uprating the current limit of £350 to £450—the level of average earnings at the time of Second Reading in March—would cost the Exchequer a significant sum of money.
Mr. Jonathan Djanogly (Huntingdon) (Con): Did not the Minister say earlier this afternoon in Committee that the average is now closer to £470?
Ian Lucas: I do not believe so, but I will happily check the record and get back to the hon. Gentleman on the matter; I am grateful to him for highlighting it.
We estimate the cost to the Exchequer as somewhere between £44 million and £86 million a year, so the Bill clearly requires a money resolution. I should make it very clear that the tabling of the motion does not indicate any change in the Government’s position on the Bill. Those who participated in the Second Reading debate on Friday 13 March will know that the Government’s objections to the Bill as it stands were set out at some length.
I am pleased to be able to announce that earlier today Parliament recommended for approval secondary legislation to implement the £30 increase in the upper limit from £350 to £380. In the meantime, despite our continued opposition to the Bill as it stands, I am moving this motion in accordance with convention and parliamentary process. For those reasons, I commend the resolution to the House.
10.2 pm
Mr. Jonathan Djanogly (Huntingdon) (Con): Let me make it plain that the reason why we oppose the Second Reading of this union-sponsored Bill, and the Government’s haphazard attempt this afternoon to find a compromise, is that all those proposals, and the money resolution, will reduce access to employment opportunities at a time when the Government should be doing exactly the opposite—and, as I shall show, at a significant cost, not only to business but to the taxpayer.
Since 1999 the weekly limit for statutory redundancy and unfair dismissal payments has been increased in line with the retail prices index, rounded up to the nearest £10. In 1998 the sum was £220; in 2004 it went
up to £270; in 2007 it was raised to £310; in 2008 it was increased to £330; and on 1 February this year it went up to £350. The limit has already increased by 6 per cent. this year, and earlier today we debated in Committee the Government’s plans to increase the weekly limit immediately by more than 8 per cent. to £380, at a time when we are experiencing negative RPI inflation. The Government also wish to bring the increase forward by five months, even though we have already had an inflation-busting increase this year.
Tonight we are debating the implications for the public finances of an increase from £350 to something in the region of, let us say, £470. Sadly, we seem to be entering some kind of tragic bidding war between the soft left on the one hand and the hard union left on the other. Redundancies are, of course, a last resort for employers, including for the largest employer—the state. Employers do not want to lose the investment they have made in their employees, and will try to retain their staff as long as possible. They will make people redundant only when they are forced to reduce their labour costs.
The Minister will realise that increasing the weekly limit on statutory redundancy pay, especially to the extremely high level suggested by the hon. Member for Chorley (Mr. Hoyle)—or rather, by the unions—would make redundancies far more expensive for employers, including the state. Employers, including the state, will now have to implement more redundancies to reduce their labour costs by the same amount as before. If the Bill is passed, the cost to employers could mean a rise in unemployment, resulting in a significant additional cost to the Exchequer in terms of payment of unemployment benefits and lost tax revenues.
The Department for Business, Innovation and Skills had its statutory instrument approved this afternoon. The impact assessment was based on an increase in the weekly limit on statutory redundancy pay from £350 to £380. The Government estimate that business would incur up to £121.2 million in extra costs. It is obvious that an increase from £350 to £470, as proposed by the Bill, would lead to significantly higher costs, and could have a devastating impact on many businesses across the country. Unemployment is increasing every week, and it is therefore likely that the cost to businesses would be greater than is suggested by any current estimates.
What is recognised in the motion, however, is that the Exchequer, too, will be faced with enormous costs if the Bill is passed. Again, all we have to refer to is the impact assessment based on an increase from £350 to £380. In the assessment, the Government estimate that that will cost the Exchequer up to £53.9 million. We have seen what an increase of 8 per cent. will cost the taxpayer. An increase of around 34 per cent., from £350 to £470, would cost the taxpayer considerably more. I calculate the amount to be in the region of £210 million, which strikes me as a conservative figure. I should be grateful if the Minister could explain the cost implications of the motion for the state.
Given the perilous position of the public finances, we know and the Minister knows—I think he more or less accepted it in his opening speech—that the country simply cannot afford this unnecessary measure. The Government—a Government on their last legs—are desperate to appease the trade unions that back them. That is what is so bizarre. I had thought that following
this afternoon's concessions to the unions by the Government, the private Member’s Bill would be withdrawn and there would be no need for the motion. That seems not to be the case, which shows just how feeble and unable to deliver the Government have become. They now need to focus on the reality of the situation, which is that they are imposing a large and unnecessary burden on both business and the taxpayer.
Conservative Members cannot support an arrangement that makes businesses, or the taxpayer, subject to such large and unnecessary additional burdens, especially during the almost unprecedented recession in which we find ourselves. I hope that the Minister will sort out this mess before the Bill returns to the House.
10.8 pm
Lorely Burt (Solihull) (LD): The Liberal Democrats consider this to be a not inappropriate increase in the maximum amount that a person could be allowed to claim in statutory redundancy pay. We understand that the future of the Bill is still in the balance. We shall wait to see what happens, but on the whole we think that the motion is worth supporting.
10.8 pm
Ian Lucas: I have had an opportunity to check my notes from earlier today, and the correct figure is indeed £470. I am grateful to the hon. Member for Huntingdon (Mr. Djanogly) for pointing that out, and I apologise to him and the House for inadvertently giving an incorrect figure. I am also grateful to the hon. Member for Solihull (Lorely Burt).
In his peroration, the hon. Member for Huntingdon rather misrepresented the Government’s position. The Government do not accept the submissions from the trade unions, they do not accept the Bill presented by my hon. Friend the Member for Chorley (Mr. Hoyle), and they do not accept the figures given by the hon. Member for Huntingdon. Today the Government have proposed a measured, balanced, considered figure of £30 as an increase.
Mr. Djanogly: Will the Minister give way?
Ian Lucas: Because I am in the middle of a speech, and I choose not to give way.
I think that we— [Interruption.] Yes indeed, and we had a very good debate earlier today. We had an accurate exposition of the Conservatives’ policy, and of their disregard for individuals who are made redundant. We heard from them their resistance to giving help to people who have lost their jobs. They have not only indicated in the Chamber that they oppose that, but they have voted against it. I will certainly be conveying to my constituents—including those who are losing their jobs—the fact that the Conservative party opposes giving constituents real help now.
Ian Lucas: I shall give way to the hon. Gentleman now.
Mr. Djanogly: As we are talking about a money resolution, it is important for the Government to give some idea of the cost of the proposals to the Exchequer.
Ian Lucas: The Government are not supporting the Bill; we made our position very clear on Second Reading. The figures for the Government position were fully set out for the hon. Gentleman earlier this afternoon.
This is a measured, considered response from the Government and, unlike the position of the official Opposition, it offers a balanced approach. I therefore commend the money resolution to the House.
Business without Debate
Delegated legislation
Motion made, and Question put forthwith (Standing Order No. 118(6)),
That the draft Companies Act 2006 (Accounts, Report and Audit) Regulations 2009, which were laid before this House on 5 May, be approved.— (Ms Butler.)
Armstrong Group Pension Fund
Motion made, and Question proposed, That this House do now adjourn. —(Ms Butler.)
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