My Lords, I shall speak also to Amendments 118B and 118D standing in my name and that of my noble friend Lord Stevenson, and shall also oppose the Question that Clause 36 stand part of the Bill. I will also speak in support of the amendments tabled by my noble friends Lord Whitty and Lord Lea of Crondall.
We are in some difficulty in dealing with Part 3. We had assumed that this was going to come up at around the end of the month because that was the original schedule. However, with the pause to Part 2 agreed here a week ago, it has all been rushed forward. Part 3 has been jinxed from the start. It was a very late addition to the Government’s programme and to the Bill. The short consultation period was in August, which is not a particularly busy month for many of us, and now, given the attention that has been given so far to Part 2, we are dealing with Part 3 on the run in this House before many people are remotely aware of its significance or of what it is about. However, our contention on this side is that this part of the Bill is very important. We hope that today we will at least be able to raise awareness of the issues at stake and appeal to fair-minded Members on all sides of the Committee for their support in looking in detail at what this part involves.
We have raised our opposition to the clause standing part as part of an attempt to persuade the Government to think again and to think further about what resembles a vindictive attempt to load on to trade unions a great new dollop of red tape—a new layer of bureaucracy that is unnecessary by any objective or fair-minded standard. Of course unions should keep accurate records. Indeed, they are already required to do so under the Trade Union and Labour Relations Act. They are required to make detailed returns on an annual basis to the certification officer. They are required to have independent scrutineers in all elections, and invariably those scrutineers check the membership registers. The certification officer—the union regulator—has the power to order a rerun if there is a complaint of sufficient importance.
I note from yesterday’s press that there are allegations by a defeated candidate about a recent election in Unite. By the way, that election was supervised by
Electoral Reform Services—the old Electoral Reform Society. I also understand from the press that a complaint has now been made to the certification officer. If it is upheld, the certification officer will have appropriate powers, if necessary, to order a rerun. He does not need new powers as foreseen in the Bill. As far as I know, the certification officer has not asked for any new powers. He does not feel that he is lacking any ability to deal with issues that are referred to him. Therefore, I do not believe that there is any basis for heaping extra requirements on to unions. Likewise, industrial action ballots can be, and occasionally are, challenged by employers on the grounds either that inappropriate people are balloted or that people are missed out of a ballot. Therefore, unions have every incentive to keep accurate records.
I should like to know from the Government why they are doing this. What is the motivation for it? Why are they incurring considerable expense on all sides—unions, employers, the Government and the taxpayer—for this particular non-event? There is no rationale for this provision, which will involve extra bureaucracy and extra costs. This Government were anti-red tape when they were on the other side of the House, but they are obviously making an exception for trade unions.
The cry has gone up that we need more assurance and more confidence. I see the noble Lord, Lord Tyler, in his place. He suggested, among other things, that this was necessary because a union has a political role. Lots of other organisations have political roles, but are their membership rolls to be supervised by a public official? Are the political parties going to be thrown into the mix? Do we need some assurance about how many members they have? That would be very interesting for some of us to read. No, it is unions, again, that are being scapegoated and picked out to be given a kick on this issue.
By the way, only a small minority of unions have anything directly to do with the Labour Party, yet many, such as the Royal College of Nursing—which is, I may say, a good way off the Labour Party—will be affected by this part of the Bill. It is a blunderbuss, aimed at just one section of society that plays a political role. If I were paranoid, I would say that we were being persecuted.
The stated intended effect of the Bill is to ensure that voting papers and other communications reach union members, and so give greater confidence that members have the chance to participate in union affairs. There will be a new statutory duty to provide the certification officer with an annual membership audit certificate that provides an opinion on the union register, with the larger unions having to appoint an independent “assurer”—I have not come across that interesting title before—and a duty for the certification officer to appoint inspectors to investigate and make orders, and for those officials to issue declarations and enforcement orders for non-compliance. Heavy-handed, or what?
That is tough administration. Again, if unions were getting a litany of great numbers of complaints, I might be able to understand the reason for it. But there is no such evidence. As I and others pointed out at Second Reading, there is absolutely no practical reason for these measures to be in the Bill.
Are union membership records defective? They are not perfect; I would be the first to acknowledge that. How can they be? Unions collect their money in one of three ways. The traditional way was through regular cash collections by voluntary officials such as branch secretaries, shop stewards and others. That is very difficult in some circumstances—in construction, for example, with a fluid workforce and many people on very short-term contracts. It is difficult in many other places, too, as anybody who has ever collected money for a political party or a voluntary organisation knows. The record keeping could sometimes slip, depending on the efficiency of the individual collector; I have no doubt about that.
The second way to collect subs is by the so-called check-off method, using deductions at source by an employer, for which the union usually pays the employer a handling charge. In one of my other roles, helping to secure auto-enrolment for pensions, we are having a lot of trouble with the quality of employer payrolls. With some of them, as many as one in four workers is not properly reflected on the payroll. I know that unions and employers together have big problems handling the check-off. In certain sectors, such as retail, there is a high turnover of labour: a third of the members of USDAW, the main retail union, have to be replaced each year just for membership numbers to stand still. Keeping those records up to date is a huge administrative job. The employer is probably paying a quarter in arrears anyway, so for a significant part of the quarter a union may be some way out with its membership register. The third method is by direct debit and standing order. They tend to be more accurate, so I shall not dwell on those.
Where are the problems with all this? It is not perfect, I agree. If I were the assurer I would not quite know how to deal with some of the sectors where unions have to collect their money and organise their members. Between 2000 and 2004, a total of six complaints were received by the certification officer, five of which were dismissed—and even for the sixth one he did not issue a declaration. He just expressed an opinion that some things could have been done differently. There had been no complaints in respect of a vast majority of unions. In fact, I did not know about another one at all until I read the Sunday Times yesterday.
I stress that there is no real problem. This is a remedy in search of a problem. I would like to think that many noble Lords on the other side of the House would be embarrassed about this waste of effort and time. The cost to unions of this part of the Bill on the Government’s own estimate is about £460,000. By the way, that is an underestimate, which fails to take into account the necessary changes to rule books. Some unions have to have rules revision conferences and some have them only every five years or so. It does not reflect the continuing cost of having the assurer and annual audit done year after year. It is not only unions that will have to pay. Business will have to pay and the estimate is about £400,000, £100,000 of which will end up on the Government’s budget, and therefore on all our budgets as taxpayers.
Some noble Lords will no doubt be thinking, “As a former general-secretary of the TUC, he would say that, wouldn’t he? It’s predictable stuff from the TUC”.
But they do not need to take my word for it on this occasion. They need only glance at the report of the Regulatory Policy Committee, a business-dominated government committee attached to the Department for Business, Innovation and Skills whose sole purpose is to curb red tape. I emphasise that the committee is composed largely of business representatives from the chambers of commerce, the Institute of Directors, and others. It has issued a rare red card to the Government on this matter—a stop notice in effect on Part 3. Unfortunately, this was not available at Second Reading. The House as a whole needs to be alerted immediately to the report, and I hope that it will be prepared to look afresh at this proposed legislation.
Some noble Lords may not care too much for trade unions; they may think that they deserve all the flak they get. But I ask the fair-minded to take a look at the report. I shall quote some points. It says that the impact assessment of the Bill,
“needs to provide a more detailed assessment of all likely costs to trade unions … supported by further evidence that was gathered … It is unclear how accurate and up-to-date a membership register will have to be for a union to be considered ‘compliant’ … or what process of investigation would be undertaken by an independent qualified assurer, or how rigorous that process would be”.
It also refers to the recurring costs. The committee illustrates that it was only after the Bill was published that the short August consultation period was started. It highlights the failure to follow appropriate better regulation processes—hence the issue of that very rare red card.
Our case today is not just about red tape. Individuals sometimes have to be careful who knows they are in a union. Countries that require a public official to know who is or is not in a union tend to be despotic tyrannies. Although I do not belabour the Government with that charge, information on union membership is very sensitive. Blacklists do exist. Eight major construction companies have recently admitted that and more than 2,000 workers are in line with legal cases against some of the biggest household names in British construction. There are worries about membership information finding its way to the unscrupulous end of employers. Worries have been expressed by parliamentary committees about breaching the confidentiality of union membership records. There are concerns, too, that Part 3, despite what is in the Bill, is not compatible with Articles 8 and 11 of the European Convention on Human Rights or with certain obligations concerning the International Labour Organisation.
The Political and Constitutional Reform Committee has asked the Government to address these concerns during the course of proceedings on the Bill. There is plenty of criticism from around the House of this part of the Bill. Part 3 in fact confers powers on state officials in relation to voluntary organisations that seem odd in a liberal democracy—organisations which, under these international obligations, are protected from too much state interference. Only if there is a proportionate need, is the theme running through them, should curbs be brought in. I have not seen anybody yet demonstrate that there is any sort of proportionate need. Therefore, in the period between now and Report stage, we will be trying to raise general awareness about Part 3 and its rather vindictive,
malicious nature. The Government did listen to reason on Part 2 and I hope that they will listen again on Part 3 in this intervening period. We are looking for support for our contention that Clause 36, a keystone clause in Part 3, should not stand part of the Bill.
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I hope too that there will be support for the other amendments. I refer briefly to Amendment 118A, which would adjust the reporting duties so that it would be only once a complaint was received that the process laid out in the Bill would have to kick off. Amendment 118B would introduce an appeals mechanism for unions to say, “Come on, this is ridiculous”. I leave the merits of Amendment 118C in the capable hands of my noble friends Lord Whitty and Lord Lea. On Amendment 118D, I simply point out that the amendment is part of a series that seeks to make the Bill less onerous, complicated and costly to unions and employers. It aims to probe whether the Government are really hell-bent on a Bill based on anti-union prejudice or are open to constructive ideas. It seeks to do this by deleting the requirement on a union in relation to these reporting periods—a duty to submit the membership audit certificate in relation to each reporting period—which would be at least one year. We seek to alter this to require a union to submit a membership audit certificate if the section is invoked.
At the moment the Government resemble Don Quixote, tilting by reflex at the trade union windmill, dreaming up remedies before they have identified the problems, and prodding unions with a stick, like little Albert in Stanley Holloway’s piece, to try and incite some reaction and make a rather shabby political point. Polishing up union-bashing credentials seems to be a right of passage for some on the other side of the House. Just remember this. A recent poll has shown that 78% of the population believe that,
“trade unions are essential to protect workers’ interests”.
The Government therefore should think again before Report. They should start to act in a fair-minded way and not be blinded by ill-informed prejudice. I beg to move.