Where on earth does one start with this poor excuse of a Bill? It is worth reflecting on where it all started. The Bill was a ridiculous and badly thought-out idea cooked up for insertion in the Chancellor of the Exchequer’s conference speech. It has been so badly handled and so badly thought through that people from all political parties, employers and employees have united in almost universal opposition to it.
Lord Bilimoria, one the country’s best-known business men, who voted against the plan in the other place yesterday, described the policy not just as a dog’s breakfast, but as a mad dog’s breakfast. The noble Lord is a man to whom all hon. Members should sit up and listen. I do not know whether hon. Members have partaken of Cobra beer while treating themselves to a curry, but Lord Bilimoria is the man behind Cobra. He is certainly worth listening to. He said that:
“from a businessman’s point of view, this does not make sense. It is absolutely unnecessary to do this”.—[Official Report, House of Lords, 24 April 2013; Vol. 744, c. 1450.]
The Minister referred to the concessions—that concessions have been forced out of the Government serves only to reinforce how badly thought-out the proposal was. Whether or not JSA claimants could lose their benefit if they refuse to accept job offers carrying the employee shareholder status was an obvious question. I first asked it in November, when the Government ignored it. I repeated it, and the Government said that they could not lose their benefit. When they were mauled on the point in the other place, they effectively admitted that they could. In order to get the proposal through in the face of opposition from several former Conservative Cabinet Ministers, the Government had to come to the House last week and agree to amend the guidance for Department for Work and Pensions Jobcentre Plus advisers to state explicitly that a jobseeker cannot be mandated to apply for an employee shareholder job. They should have done that in the first instance. What a total shambles.
Another issue is the advice and guidance to potential employees, and the need to ensure that they understand what they are getting into. Of course people were going to be concerned—that was obvious. If, as is the case at the moment, the law requires that people who sign away their fundamental rights on leaving employment receive proper legal advice and guidance, then of course people were going to insist on getting similar advice on entering into employment. I doubt the thought even passed through the Chancellor’s mind as he pursued his ideological fixation with watering down people’s rights at work.
Now there is a requirement for employers to pay for that advice in advance of a potential employee shareholder entering into an agreement. The point is this: these concessions are not enough and they were never going to be enough, because this entire proposal is wrong in principle. I think that most Government Members know that: it has been notable how few Government Members have stood in support of this measure.
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During the passage of the Bill, no coherent explanation has been offered for why it is necessary to link employee ownership to people losing the fundamental rights at work that we all enjoy. No evidence has been put forward to suggest that this is what people want. The expert in this matter is the Employee Ownership Association, which has been a major influence behind the growth of employee ownership in the UK. Its chief executive could not have been clearer on this point yesterday, when he said that its membership have been absolutely clear that
“There is no need to dilute the rights of workers in order to grow employee ownership and no data to suggest that doing so would significantly boost employee ownership. Indeed all of the evidence is that employee ownership in the UK is growing and the businesses concerned thriving, because they enhance”—
enhance—
“not dilute the working conditions and entitlements”—
of the work force.
Never mind the principles, all the way through the passage of the Bill, in the other place and in this House, Ministers have simply failed to convince on how it would work in practice.
I mentioned industrial relations on a previous occasion and explained that, from a practitioner’s point of view, I do not understand how it would help employee relations if, in the middle of one’s employment, an employer suddenly says, “You know what? I think I’m going to give you some shares, but in return I want you to give up your fundamental rights at work.” No explanation has been given as to why, practically, that would work. I have said that taking away people’s employment rights, such as unfair dismissal, will simply encourage people, when they fall out with their employers, to bring spurious discrimination claims. This measure will inevitably lead to that, and there has been no explanation of how that will be addressed.
On the valuation of shares, I have asked how on earth shares given to employees will be valued. Again, very little information has been given. In fact, the Minister in the other place, Viscount Younger, last night acknowledged that for private companies there is no traded market that enables easy valuation of shares.
There is then the issue of tax avoidance. This is the Government who say that they want to clamp down on tax avoidance. The independent Institute for Fiscal Studies says that to the extent that this proposal will be used, it will foster tax avoidance on a grand scale. Viscount Younger said that the Government would not allow the scheme to be used in that way yet, as we have seen all along, he gave no specific detail whatsoever on what the Government would do to prevent it.
I want to finish by dwelling on what the Bill is all about. As the Minister said, it is called the Growth and Infrastructure Bill. We have learned that the economy has gone back to where it was six months ago and that we are undergoing the slowest economic recovery in 100 years, and the Government have come forward with this. There is no evidence whatsoever to show that the Bill promotes growth.
What of my opposite number, the Secretary of State for Business, Innovation and Skills? He has been nowhere to be seen at the scene of this crime. Where has he been? He is the man who said that he fundamentally objected to the Beecroft proposals put forward by the Conservative donor, yet he is not here and the Bill will strip away people’s rights at work in a way, some would argue, that even Beecroft did not contemplate. [Interruption.] I am told he is in Brazil. He said last February, in his famous letter to the Prime Minister and Deputy Prime Minister, that the Government had no compelling vision for growth and were coming forward with fairly piecemeal measures.