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Orders of the Day — Reduction of Redundancy Rebates Bill

Part of the debate – in the House of Commons at 12:00 am on 7th February 1977.

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Photo of Mr David Madel Mr David Madel , Bedfordshire South 12:00 am, 7th February 1977

I am certain that the Government are worried that such an increase is likely. I hope that the Minister—I shall give him plenty of time to reply—will be able to say something more about the likely increase in unemployment.

The Government will recall that the amount of pay taken into consideration for computing payments under the Redundancy Payments Act was increased from £40 to £80 in 1974. That was one of the factors that caused weekly expenditure to rise from about £500,000 in mid-1974 to over £2 million in mid-1975. Therefore, employers are wondering whether the figure for which the computation is used is likely to be increased again.

We have been debating the whole future of redundancy payments. We have been asking whether there should be a thorough inquiry into the system now that it has been working for over 10 years. I ask the Government to share their thinking with us on redundancy provision. Do they feel that the Act has led to reduced collective resistance to changes entailing redundancy? Is there any evidence to suggest that lump sum payments have helped employees to find better jobs by enabling them to look around at leisure and to make a considered choice when selecting a new job? Is there any evidence that the payments have led to unnecessarily prolonged periods of unemployment? The payments are no more nor less than financial compensation for loss of job, which is only tenuously and indirectly linked to the cost of redundancy. The Government should give us their views on that score. Do the Government think that an increase in weekly benefits for unemployment would be a more equitable form of financial compensation for loss of job and more likely to contribute to more relaxed and rational job seeking?

Now that the Act has been working for 10 years, and given the experience that exists in other countries, and the different ways in which they handle these matters, it is surely time that the Government consider in depth the questions that I have raised. What can the Government do to assist job mobility? Should they not consider the constraints, the difficulties and the obstacles which are faced by those who seek to move around? Are the Government satisfied with the co-operation between local housing authorities? I suggest that that co-operation is nothing like good enough. Even the GLC, which has been merrily overspilling into Bedfordshire and Hertfordshire for 20 years, cannot claim that the necessary contact and consultation exists between the housing authorities in our areas when people are considering transferring jobs.

The Government have announced a review of the Rent Acts. That is welcome. Surely they must admit that private sector rented accommodation has an important part to play when people are moving around the country and changing their jobs. Are the Government satisfied that there is sufficient knowledge about removal costs and grants which can be given to people when making a change of job?

Are the Government satisfied that the time off that is allowed to look for work under the Employment Protection Act has been widely enough publicised? Unless it is, that part of the Act will come to nothing.

What, therefore, are we calling for from the Opposition Benches? First, we want the Government to have more consultation with employers. The hon. Member for Aberdeenshire, East (Mr. Henderson) elicited from a parliamentary answer that the Government had no consultations with industry before bringing forward this measure. We would like the Government to consult the Association of County Councils, for example, My hon. Friend the Member for Brentford and Isleworth (Mr. Hayhoe) referred to the document sent round by this organisation. The Government must pay attention to the fact that the non-metropolitan counties this year face an alteration in the rate support grant which is bound to make it very difficult, if not impossible, for them to sustain present staff levels.

Applications for temporary employment subsidy will be accepted up to and including 30th April 1977. What happens after that? The effect of the subsidy on employment is bound to be reflected in any redundancy payments legislation.

Are the Government satisfied that there is sufficient co-operation between the Department of Education and Science, the Department of Employment and the Manpower Services Commission? I suggest that there is not sufficient consultation and co-operation. I do not think that we have begun to think through where the boundary of education ends and the boundary of training for industry begins.

What, therefore, should Ministers do? No one can say that Ministers in the Department of Employment have been inactive in the past three years. They raced through the Trade Union and Labour Relations Act and the Health and Safety at Work Act. In 1975, they rushed through the Employment Protection Act. In 1976, they raced through the Dock Work Regulation Act, although fortunately it blew up on the finishing line. Nevertheless, Ministers can claim that their time and energy have been spent pushing through major pieces of legislation. No such condition exists in 1977. The Government would do themselves a power of good if they took away this Bill and consulted management, industry, unions and the other organisations which have been mentioned and then came back again either with a measure or with some White Paper on this matter.

In my view, it never does any Government harm to say "We are thinking again in view of what this House has said." I invite the Government to do that in respect of this Bill.