Work and Families Bill

I support the amendment put forward by the noble Baroness. My first point probably answers one of her questions: we on these Benches accept that the cost to small businesses of administering these payments will clearly be more than the £4.50 referred to. That answers her question on tax. That is because if the payment is taxable, the expense is greater than the payment; therefore the overall tax burden of the employer has not increased—it has probably marginally reduced. This raises an important principle—almost the most important principle raised by the Bill. As noble Lords said at Second Reading and as various Liberal Democrat and Conservative Members said in another place, this is a moment at which the burden of regulation on small businesses can be alleviated. People did not realise when the PAYE system was introduced, many decades ago, what a burden that placed on businesses—particularly small businesses. When people talk about the need to lift regulation—as happens more often—the imposition of acting as a collection agency for Her Majesty’s Government is a significant regulation and burden, particularly for small businesses. This debate took place at least twice in another place and in this House at Second Reading, and I suspect that we will not persuade the Government of this. It is particularly unfortunate that this is one factor that has led the CBI to withdraw its support for the Bill, because we have managed under this Government since 1997 to have more or less a consensus on legislation. The noble Baroness, Lady Miller of Hendon, nods her head in agreement. I am not sure that those of us who participated with her in debates on earlier legislation would necessarily have found her nodding so agreeably; nevertheless there has been reasonable consensus across the parties. It is a shame that the CBI has been put into a position in which it has now withdrawn its approval. This clause is one of the reasons why. The prime argument made both in another place and at Second Reading for why the Secretary of State cannot take over responsibility for the administration of the scheme for small businesses was that he would have to get involved in all sorts of detail on individual provisions and circumstances which they would not have. It is difficult to believe that that is a satisfactory answer, given the computer online world that we live in, where most small and large businesses operate computer systems, and details could easily be provided to the organisation that would administer this proposal. I suspect that we will not win the argument and that the Government have made up their mind not to do this. It is a pity, but I support the amendment.