My Lords, I begin by underlining this Government’s commitment to fostering growth and restoring the UK’s economic prosperity. We recognise that legislation itself cannot generate economic activity, but it can help to set the framework in which enterprise can flourish. The Bill provides a package of measures that will get rid of unnecessary bureaucracy that encumbers business, improve the competition framework to ensure well functioning markets and advance business and consumer confidence alike.
To support enterprise, we are including several initiatives: to legislate for the UK Green Investment Bank; to improve the employment tribunal system and promote resolution of disputes; to give shareholders of UK quoted companies binding votes on directors’ pay; to promote competition through a single Competition and Markets Authority—CMA—and strengthen powers to address anti-competitive behaviour; and to make our copyright laws fit for the modern age.
We intend to simplify regulation and reduce unnecessary red tape by extending the primary authority scheme to more businesses for one-stop advice; by providing clear powers to time-limit new regulations via sunset clauses on new measures introduced; by ensuring regulation, such as on heritage protection, is delivered in an efficient manner while still providing necessary protections; and by repealing other unnecessary regulatory requirements on business.
I will address each of these measures in turn. On the Green Investment Bank, the transition to a low-carbon economy is important for the future, both globally and nationally. Some analysis suggests that more than £200 billion of investment will be needed over the next decade to develop the new technologies and products that will underpin this transition. Yet these are new markets, and the long-term nature of returns on green infrastructure investment may be deterring private-sector investors. That is why we have established the world’s first Green Investment Bank, which is now fully operational and ready to drive the UK towards a green economy.
Our employment reforms reflect our commitment to tackle employment legislation to help employers manage their workforce more effectively and ensure growing businesses have the confidence to take on new staff. Through the employment law review, we are taking decisive steps to remove the fear of employment tribunals and reduce the legislative burden on employers which stifles growth. This includes measures outside the Bill, such as introducing fees to the employment tribunal system and a fundamental review to streamline the rules on employment tribunals and make sure they operate as efficiently as possible. The Bill will provide business with more certainty about its liabilities and provide clarity on dismissal and tribunal processes, while supporting both parties to resolve their disputes earlier. The changes, such as on early conciliation and settlement agreements, will save time and cost for employers and employees. The Bill will give businesses more confidence and flexibility to deal with workplace issues, thereby providing the platform for growth that employers need.
On directors’ pay, the Government are clear that an effective corporate governance framework is necessary to support long-term sustainable growth. Investors agree that the governance of directors’ pay needs to be strengthened. The growing gap between pay and performance is damaging and unsustainable. Our reforms will require companies to be more transparent and to give shareholders a binding vote on remuneration policy. For the first time, shareholders will be able to agree real limits on what companies can pay. Investors agree that these reforms will help tackle excessive pay while still allowing companies the necessary flexibility to set pay packages that suit their specific circumstances and which reward genuine success.
On competition, a free and open market place is key to a growing economy. Pressure from competitive markets enables efficient and innovative businesses to thrive, which benefits consumers. The Government are setting up the new Competition and Markets Authority, which will provide a single, strong voice on competition. It will have a duty to promote competition to the benefit of consumers. The Bill will also streamline and strengthen competition enforcement powers, meaning that anti-competitive behaviour will be tackled more quickly and effectively, bringing benefits for businesses and consumers alike.
Chattels are a particularly damaging form of anti-competitive behaviour.