Work and Families Bill

My hon. Friend the Member for North Norfolk (Norman Lamb) is correct. The Government made a commitment to simplify the system for employers, but it seems to consist of a CD-ROM and a do-it-yourself guide. That is not simplifying the system for employers and that is not what employers read into the Labour party manifesto. I hope that the Government accept new clause 1, because we are trying to assist them in implementing their manifesto. New clause 1 would transfer responsibility for the administration of payments for maternity, adoption and paternity pay from a person’s employer to Revenue and Customs. The procedures involved are complicated, and they will become even more complicated with the introduction of additional paternity pay, because in most cases parents work for different employers, which introduces an extra level of complexity. The Government have referred to a cost-benefit analysis produced by HM Revenue and Customs, which claims to show a minimal benefit. However, that cost-benefit analysis considers only statutory maternity pay and does not attempt to examine issues such as adoption pay or paternity pay. Many small business owners challenge the assumptions in the cost-benefit analysis—in particular, they take issue with the time that the report assumes that it will take them to perform the necessary tasks. Employers who have examined the report say that it will take them far longer to carry out those tasks than the analysts from Revenue and Customs suggest. It is questionable whether the savings to employers set out by Revenue and Customs will accrue from the transfer of direct payments, and it is also questionable whether the benefits to employers will be as low as the report suggests. We need to take account of the great burden on small employers who come across new working procedures for the first time. A big employer with large human resources and IT departments will handle the new processes easily, but a small employer who is faced with working out additional paternity pay for the first time will find that it takes a great deal of time, even with the help of the Government’s CD-ROM and do-it-yourself guide. As hon. Members have said, that time is often late at night, and if the employer tries to deal with the matter during the day, it distracts them from trying to grow their business and create jobs. New clause 1 states that companies with fewer than 50 employees should be given the choice between running that part of the payroll themselves or transferring it to HM Revenue and Customs, which should be able to run such procedures more easily given the benefits of scale. That would compensate small employers—the Government are giving small employers more work by introducing new rights for workers, and they should help them by taking on that part of the administration. It is vital that we free up small employers to enable them to grow their businesses, and we can do so by giving them a choice on the burden of administration. Finally, I remind the Government of their manifesto commitment, which I hope that they honour today.