Work and Families Bill

moved Amendment No. 25:"Page 12, line 10, at end insert—" ““(   )   The higher sum so specified shall not be greater than 110 per cent of the current maximum amount of a week’s pay immediately prior to the date of the order.”” The noble Baroness said: We are meant to be finishing in a few minutes. I am quite content to sit until 6.30 but I would not like to go on longer, given that, as Members of the Committee may know—certainly my friends do—that I am a carer, and my mother, who is nearly 98, is waiting for her dinner. My speech is not very long but it is an important issue; as we are in Grand Committee, we will not divide on it. I am happy to speak to it if everybody agrees. The amendment would impose a cap on the uprating of redundancy pay which is introduced by Clause 14. The noble Lord will remember that I mentioned that my noble friend Lady Morris and I were somewhat surprised when we saw the clause because we thought it was incongruous. The Minister said that it was there because it was a manifesto commitment. I have to concede that indeed it was a manifesto commitment, so long as you are used to reading the fine print in credit card agreements or holiday brochures. The manifesto says:"““The Labour Party has agreed a set of policies for the work place (the Warwick Agreement) and we will deliver them in full””." Agreed with whom? It was an agreement with the trade unions. I wonder how many of the voters have ever heard of the Warwick Agreement, let alone know what the Government promised them as the price of their continuing support. In my opening sentence introducing the amendment, I referred to the ““uprating of redundancy pay””. I used those words especially because those four scant words are the sole reference to this provision in the Warwick agreement—whereas the other one, about the eight days, is spelt out. Yet it is on these four words, and the obscure introduction of them into the manifesto, that the Government claim a blank cheque to alter the formula by which redundancy pay has been calculated for the past 40 years, and regularly updated to take inflation into account. The Explanatory Notes do not give any reason for this proposed change in that formula, nor did we get one from the Minister when I raised the issue at Second Reading, save for the fact that, as I have just quoted, it was in the manifesto. I am not impressed by the fact that the Government, in an apparent act of real self-denial, limit the right to make this increase to just one occasion, because the Government know full well that one Parliament cannot commit or bind a future Parliament. This Government may do it only once—I do not doubt that at all—but all this clause does is to set a precedent which could be prayed in aid at some time in future. There is a suggestion that some changes will have to be made to the basic formula to allow for compliance with yet another EU directive, and obviously we will need to examine this aspect when they come before Parliament under the affirmative procedure. However, what we are concerned with is the provision that the Government can make a one-off increase outside of the inflation proofing formula of an unspecified and—as the Bill currently stands—unlimited amount. Apart from not giving any explanation of this provision, except to say that it is Labour Party and trade union policy, as mentioned in the Warwick agreement, the Minister also did not comply with my suggestion in the debate that he should tell your Lordships precisely what figure the Government have in mind, or, if nothing has been decided yet, to tell your Lordships what representations they have received. I am, however, most grateful to the Minister for having written to me and to other noble Lords who share my concerns after Second Reading to give further information. He tells me that the Government are consulting with what he calls ““key stakeholders”” including the CBI and the Engineering Employers’ Federation. He did not mention whether he was consulting again with the unions in his letter, but I assume they are definitely included in the current consultation unless the Government are already aware of what amount they are seeking. We believe that the unions are seeking an increase from the current fully-indexed £290 per week to a possible £400 or £500, or even a staggering increase of 100 per cent, which would make it nearly £600—in other words, £580. The Minister did not deny this when I put that suggestion to him on Second Reading. At this present stage of the legislation, we are therefore being asked for a blank cheque. The questions are how much of an increase are the Government proposing, what is the justification for it, and what are the Government expecting in return for it? Who will be paying for this largesse? Will it be the employer, who, one assumes, will be in some financial difficulty, otherwise why would he be making staff redundant? Or will it be the shareholders in a failed company whose depleted assets will be distributed in this way? Or will it even be, in an extreme case, if an employer is totally insolvent, the taxpayer who will be left to pick up the bill? In his letter to me the Minister was kind enough to say:"““I am not prepared at this stage to comment on the timing or amount of any increase, other than to say that l do not expect the limit to be increased dramatically””." Well, it all depends, as the late Professor Joad used to say, on what you mean by ““dramatically””. We have still not been given a substantive explanation as to the reason for this change of a time-tested formula. However, this probing amendment seeks to define ““dramatically”” by setting a cap to the increase to 110 per cent of the amount of the figure applicable at the time when the Government make the order, which is also to take place on a date the Government have declined to reveal to us. In other words, the Government can add a bonus on one occasion only limited to an extra 10 per cent of the then current figure. I beg to move.