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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 John Golding Mr John Golding , Newcastle-under-Lyme 12:00 am, 7th February 1977

If the hon. Gentleman reads the later part of Mr. Gunter's speech, he will find that matter well dealt with.

We are not debating the principle of whether we should have redundancy payments. The basis of the Opposition's attack tonight is that they still confuse redundancy payments with unemployment benefit. We strongly believe that redundancy payments should remain. The hon. Member for Brentford and Isle-worth made up his own interpretation of the Chancellor's speech. It is clear from re-reading the Chancellor's statement that the importance of this measure is that it is one contribution towards shifting the emphasis towards selective assistance.

I share the concern expressed for the small firm and for any who are declared redundant. That is why I regard the temporary employment subsidy as having made such a great contribution in the last 12 months to helping small employers and to helping to avoid redundancy.

We heard the hon. Member for Brentford and Isleworth put forward a supposition about the figures, but I must tell him that the figure of £18 million is not and cannot be precise. It does not depend entirely upon the calculated future level of unemployment. We are not talking about unemployment benefit. Redundancy payments will be paid whether or not individuals are unemployed. It is compensation for loss of office.

At a time of high investment, there can be a substantial increase in the number of redundancies without any increase in unemployment. Conservative Members must get this clear. They opposed the Redundancy Payments Bill in 1965 on the basis that they would have preferred first to see wage-related benefits.

If less money is taken from the fund, more is available for lending to the Government, and that would reduce public expenditure. But borrowing from the fund does not take money permanently out of the fund. That is the answer to the hon. Member for Brentford and Isleworth.