I beg to move,
That, for the purposes of any Act resulting from the Employment Relations Bill, it is expedient to authorise the payment out of money provided by Parliament of any increase attributable to the Act in sums payable out of money provided by Parliament under any other enactment.
The Employment Relations Bill deals mainly with the regulation of trade unions and with employment relations more generally. Its provisions make various minor changes to the existing regulatory regime to improve its operation. Many of its provisions flow from the review of the Employment Relations Act 1999, which we launched in July 2002. The review concluded that the 1999 Act was working very well, but that some relatively minor adjustments were required. None of the Bill's existing provisions requires additional public expenditure, so we did not table a money resolution when the Bill was introduced and had its Second Reading. It is now being considered in Standing Committee. On
I will not give way. There is a maximum of 45 minutes for this debate and the hon. Gentleman will have an opportunity to contribute.
The amendment plainly would have implications for public expenditure. Its tabling therefore necessitates that a money resolution be attached to the Bill. The wording of the money resolution—
I have indicated to the hon. Gentleman that I am not going to give way.
The wording of the money resolution takes the standard form authorising this type of expenditure. My amendment involves the insertion of a new section into the Trade Union and Labour Relations (Consolidation) Act 1992. The legal basis for the expenditure will be located in the 1992 Act. The reference to "any other enactment" in the money resolution reflects the way in which the power is drafted and the position of the legal basis for the expenditure.
On the day the amendment was tabled, I made a written parliamentary statement to explain the relevant background—
Thank you, Mr. Deputy Speaker. I hope that the hon. Gentleman will contribute to the debate in due course.
On the day the amendment was tabled, I made a written parliamentary statement to explain the relevant background. I indicated that we would use the power to establish a union modernisation fund, the total size of which would be between £5 million and £10 million, with the expenditure spread over several years. We do not envisage the fund opening until the 2005–06 financial year because further work needs to be undertaken that will involve—I stress—full public consultation in the autumn on the details and design of the fund.
I commend the motion to the House.
As the Under-Secretary said, the Bill was the result of substantial public consultation. The explanatory notes show that we had the DTI discussion paper, "High Performance Workplaces: The role of employee involvement in a modern economy" in July 2002. Last year, we had "High Performance Workplaces: Informing and consulting employees" to seek the views of a wider audience on the proposed scheme. The Under-Secretary knows that there was a great deal of discussion between the trade unions and the employer organisations, particularly the CBI. Those organisations basically agreed on the measures included in the Bill.
There was consensus, although the unions would have liked to go a bit further and the CBI and other organisations felt that parts of the Bill had gone a little too far. In the spirit of what was agreed, we have supported quite a lot of the Bill. However, the original Bill did not require a money resolution. The understanding of all the employer organisations was that there would not be any major demand on the public finances.
On Second Reading, my hon. Friend Mr. O'Brien said that he was concerned that the Bill would be a Christmas tree upon which other measures and demands by the trade unions or other parties would be hung. The Under-Secretary said that that was not the case and that no other concessions would be made to the trade unions, employers or anyone else. The Bill would remain exactly as it stood.
Out of the blue, we had the new clause, which requires the money resolution that we are debating. The new clause makes it clear that the Secretary of State may provide money to a trade union to enable or assist it to carry out various measures. We on this side support much of the work of the trade unions. I am meeting the TUC, with which my hon. Friend the Member for Sutton Coldfield has had a number of meetings. We have also met individual trade unions. We support the idea of trade unions providing a good service to their members and we support the idea of trade union modernisation. We feel that there is a great deal that they can and must do to help their members.
The Under-Secretary said that he envisaged the size of the fund being between £5 million and £10 million. However, nothing in the Bill states what the ceiling will be; the amount could be much, much more. There is plenty of money washing around in the DTI, such as the post office renewal fund, the Business Link budget and other budgets. It would be easy for the Secretary of State to take some money from one of those budgets and put it into the modernisation fund. Indeed, the amount could go well beyond £10 million.
Furthermore, the measure is open-ended. The new clause states:
"money may be provided in such a way as the Secretary of State thinks fit (whether as grants or otherwise) and on such terms as he thinks fit (whether as to repayment or otherwise.)"
That is extremely open-ended.
There are a lot of purposes for which the money may be spent. The note accompanying the new clause suggests that the money may be used for training union representatives in, for example, business and people management. It may be spent on helping to promote the development of high performance workplaces, on reviewing internal union structures and organisations, on enabling unions to broaden their dialogue with members by greater use of the internet or on making union systems more accessible.
Those are all noble measures, but surely any organisation doing its job properly in the modern world—with the internet and IT—is doing that sort of thing already. The unions are doing that already. My hon. Friends and I in the Opposition business team have great respect for the trade unions, which we think are well-run organisations.
Surely this sets a precedent for any national member-based organisation to be able to obtain Government or taxpayer's money. For example, I was just thinking how much the women's institutes would welcome such a pot of gold.
My hon. Friend is right. The Bill is not even-handed. Plenty of employer organisations that were very much part of the consultation process—such as the CBI, the Institute of Directors, the Engineering Employers Federation and the Federation of Small Businesses, as well as the organisation mentioned by my hon. Friend—would love to have public funding to modernise. Many of them would love to do more research but most, unlike the trade unions, are leanly staffed. I was talking to a trade association yesterday—the Garage Equipment Association—which has precisely one full-time member of staff and a secretary. Such organisations would love to have Government money to modernise. That is why the money resolution is not even-handed—it gives money only to the trade unions and not to other organisations.
The CBI and the IOD have in the past told the Government that they would like to be able to access public funds if they were available. However, they live in the real world and know that public finances are extremely tight. They know that they do not have a cat in hell's chance of getting public money to modernise. That is why the new clause is completely one-sided.
Furthermore, the new clause is open to abuse. The Under-Secretary's written statement says that the Government will publish for full consultation the draft rules and procedures of the fund after Royal Assent. We are making this money available; surely we should know now the draft rules and procedures. We are being invited to vote for an open-ended amount of money with no rules or procedures whatever in place.
I am listening to my hon. Friend with great interest. Is the £6 million to be given each year or is it just one lump payment? If it were each year, would that mean a transfer from taxpayers to the trade union movement or would it be a £6 million transfer from the trade union movement to the Labour party?
My hon. Friend has a suspicious mind, which brings me on to another significant concern. As he rightly points out, the arrangement is wholly open-ended and there is no ceiling, so when he talks about £6 million a year, it could really be £10 million or £15 million a year. The key point is that the money could easily be abused. No rules or procedures have been laid down, so the money could be used for blatantly political purposes—there is no question about that.
My hon. Friend believes that the raison d'être of the new fund is to help the Labour party. It may be no coincidence that, in the last financial year, the Labour party received almost exactly £6 million from the trade unions. When the Minister was asked how much would be in the fund, he said that it would be between £5 million and £10 million in total, spread over several years, but we have had no more detail.
We know that the Labour party's finances are under pressure. The National Union of Rail, Maritime and Transport Workers said that it was going to withdraw its funding of the Labour party, and Amicus is now in the hands of a pretty left-wing general secretary. Let us envisage the situation. Amicus might tell the Labour party that it is not going to pay any more funds to Labour from next year. The Secretary of State rings up Derek Simpson, and says with a nod and a wink that there is money in the modernisation fund, but Amicus is going to cancel payment—
This country's public finances are under substantial pressure. We heard only yesterday in Prime Minister's questions about a children's fund that supports many good causes such as dyslexic and dysphasic children, vulnerable young offenders and so forth, but that fund is being cut. Soldiers and marines are short of Arctic warfare equipment and 30 of them have frostbite because of the lack of Government money, yet the Electoral Commission has a budget of more than £25 million, the new supreme court will cost roughly £50 million and we now have a new fund up of to £10 million and possibly more.
There is no question that this amounts to nothing more and nothing less than what my hon. Friend Mr. Mitchell said—a bung to the trade unions. It is dressed up—
Order. I have to tell the hon. Gentleman that, whatever the merits of his points, they are more suited to subsequent debates in Committee and on Report. They are not suited to today's debate on the money resolution.
I have a speech prepared for Committee and I will indeed— on your advice, Mr. Deputy Speaker—reserve some of my best phrases for that debate. However, it is clear that the Minister's statement was dressed up in modern business school management consultancy jargon, and nothing can disguise the fact that this is a rotten use of public money. That is why we will vote against the resolution this afternoon.
I might not have chosen the same language as Mr. Bellingham, but on the substantive issue we are in agreement with the Conservative Opposition. We support the principles of the Bill and we voted in favour on Second Reading, and I am sure that the Minister will testify that we have engaged constructively in Committee.
I respect the Minister and his personal good faith, but if he is saying that £5 million to £10 million will be devoted to certain purposes, why does not the money resolution say that, rather than giving an open-ended commitment? Money resolutions usually have a figure attached. I appreciate that they do not have to have one, but it is reasonable for the House to be concerned about being asked to vote for a money resolution that literally has no price tag attached but only the Minister's indication in his speech. As a matter of principle, I believe that the House should expect the courtesy of a figure.
It occurs to me that the position might be even worse than the hon. Gentleman fears. He suggests that we have been given an indication that the amount might be £5 million to £10 million, but we have not been told whether it is a one-off payment or one that will be made every year, every other year, every month or whatever. It is a seriously open-ended commitment that amounts to a blank cheque to the trade unions.
The wording on the Order Paper shows that it clearly is. I am prepared to accept the Minister's good faith, and I assume—perhaps he will make it clear—that he is talking about a total figure. Mr. Wilshire is right that it could be anything, and the new clause that amounts to the requirement for the resolution is even more open-ended.
The connection, it seems to me, should be a matter of awkward embarrassment to the Government. It rather has the shape of a reverse takeover. The Labour party was originally the creature of the trade union movement and it is essentially a wholly owned subsidiary of the trade union movement. That is why it is called the Labour party. We now have a position in which the trade unions may become a wholly owned subsidiary of the Labour party through the courtesy of the taxpayer.
It is a matter of clear concern and Ministers know perfectly well that the public will draw conclusions from it. Personally, I believe that it is unwise for the Government to take this course. There has been, in several ways, a respectable distancing of the relationship between the Labour Government and the trade union movement, but the money resolution blows away what I had thought was a real division. It now looks more like a façade.
The timing is also uncomfortable. Many of us expect that we are likely to be at the hustings within 12 to 14 months, and money will change hands between the trade union movement and the Labour party. [Interruption.] The smiles on the faces of Opposition Members tell me that they know perfectly well what this is all about and that they are very comfortable with it.
The hon. Gentleman uses his phrase again, but I have tried to express it more specifically and elegantly in my terms; I accept that both versions relate to the same basic issue.
On union modernisation, which I agree with, Mrs. Browning made a point in her intervention that was not facetious. The reality is that the unions should modernise: unions are modernising and most of us have paid considerable tribute to the change in the character of the trade union movement over the last 20 or 30 years.
When I was a member of the Trade and Industry Committee I had experience of taking evidence from trade unions. I recall some extremely constructive engagements in which the trade unions made positive contributions to business interests, relations with management, market developments and all sorts of issues that were extremely beneficial to the good working of the economy. It seems strange that taxpayers' money is now required to achieve that.
To conclude, the Minister might have acquired my party's acquiescence—I doubt whether he would have secured that of the Conservatives under any circumstances—if the wording of the motion had been more specific about the money requirement. However, I still have a concern in principle about whether the Government should be doing this. My warning to the Minister, his Cabinet colleagues and perhaps even the Prime Minister is that I believe that the Government will come to regret their decision because the political damage will far outweigh the financial gain.
Of course; both of which attacked the measure before the House. I have always had a high regard for the Minister, whom I know well and like, even though he is not listening. We have taken part in a tug of war together and on some obscure occasion we went running together, so I make no personal attack on him. It is a matter of principle. Government Members are smiling, as though this were not a matter of principle. Some of them are members of trade unions, which is absolutely fine. As far as I am concerned, free association and trade unions are important. However, I wonder whether Labour Members would like to explain to the national media and their local press how they can support an open-ended commitment of taxpayers' money to trade unions that give the Labour party large amounts of money and will receive large amounts of money back from the taxpayer. How can Labour Members sit there smiling and rubbing their hands together?
It is a great matter of principle as to whether we, as guardians of the public purse, are to give trade unions money. I would like the Minister to defend the motion on that basis alone.
The resolution refers to
"any increase attributable to the Act" and it is clear that the measure is necessary for the purposes of a clause that the Government want to introduce into the Employment Relations Bill. I fully accept that it would be wholly inappropriate to get into a discussion about what the Government may want to do in Standing Committee. However, the House is being asked to sign a blank cheque.
I had a good working relationship with the Minister in a different capacity, when he was part of the usual channels, and have the highest regard for him. Like my hon. Friend Mr. Robathan, I mean him no discourtesy and none of my observations is meant personally, but a matter of principle is at stake. The Minister will understand that when principles are discussed, the person concerned is sometimes dragged in. I apologise in advance if he feels that is happening in this instance.
The Government could guarantee that the arrangement that the Minister described cannot be departed from.
I have a shrewd idea that if I were to discuss whether the figure should be £5 million or £10 million, I would be straying into the business of the Committee. The Committee can resolve whether or not it is appropriate for funds to be used for trade unions. I would love to discuss whether the figure of £5 million or £10 million is right. I would love to discuss whether or not the measure has been properly costed, how the figures have been arrived at and whether or not it is appropriate to make payments to trade unions. However, Mr. Deputy Speaker, you have said that one should not touch on those matters, so I will leave them alone.
Order. If this helps the hon. Gentleman, it would be perfectly in order to talk about the amount of money that could be made available. Only moving beyond that subject would be likely to lead the hon. Gentleman into difficulties.
I am most grateful. I was trying to get there without being told that I could not.
Missing from the motion is any indication of how much money is involved. We have the Minister's word, but given the way that politics work, he might not be the Minister tomorrow.
I am suggesting that he might be promoted rather than sacked. He is such a good Minister that he might be doing something else. While I respect his explanation to the House, I cannot say that I have the same confidence in all his colleagues. It may be that tomorrow, the day after or next week the figure of £5 million to £10 million that the Minister suggested will become something entirely different. Who knows how much pressure may be exerted?
Will the hon. Gentleman remind the House of the cap placed by Margaret Thatcher on the cost to the taxpayer of trade union political fund ballots when she introduced them? In the main, trade unions chose not to use that taxpayers' money. I remind the hon. Gentleman that more than 7 million trade unionists are themselves taxpayers.
I would like to discuss Margaret Thatcher and her sensible policies but I suspect that that would be well beyond allowable debate. If the hon. Gentleman wants to discuss that issue, let us meet in the Strangers Bar and see how we get on. We would not be constrained by the terms of the motion.
It is important that there should be some justification for the appropriateness of the figure of £5 million to £10 million. The Minister's estimate is pretty sloppy guesswork. The Government should have known that devising a resolution to give money to their trade union masters would be controversial and be seen as a party political move. The least they could have done was explain how they calculated the figure.
Is there not a remarkable coincidence as regards the sums quoted by the Minister and the amounts voted by trade unions to the Labour party? Would it not be sensible for trade unions to use the political money to fund their modernisation?
The hon. Gentleman is being very kind, for a Liberal Democrat. Perhaps he is being kind to the Government. That would make some sense. I take a more cynical view. I do not believe that it is a coincidence that the two sums of money are much the same. That is exactly what the resolution is all about. A figure has been announced by the Government's trade union masters, and the Government feel obliged to pay up. Since the trade union masters have not said precisely how much the Government must pay, there is a 100 per cent. variation in the figure that should be in the resolution, but is not. The Liberal Democrat view that there is a coincidence is too generous by half given how the Government work and the way in which they are controlled by the trade unions.
If the Minister wants to continue to be held in high regard, all he need do, since the money resolution is unamendable, is to confirm that he will arrange for a new motion to be brought before the House that imposes a limit. Whether the figure is £5 million or £10 million, there must be some justification for it. Surely somebody in the Minister's Department or the Treasury is capable of doing some sums, rather than saying simply that there may be a 100 per cent. variation in the figure first suggested. It should not be difficult for the Government to present definite figures to the House and say, "If we need more, we guarantee that we will return to the House for further discussion."
Although we are told that the purpose of the measure is to enable a particular clause to be added to the Employment Relations Bill so that a bung can be given to the trade unions, the motion does not say that but refers to
"any increase attributable to the Act".
I accept the Minister's assurance, but if that is the resolution's purpose, why does it not say so? If the motion stated that a maximum amount of money should be made available for a specific purpose, we would know exactly where we stood.
The Minister may be promoted shortly and his successor may say, "I have thought of another reason. The motion refers to 'any increase', and I do not need to come back to the House to justify a payment."
I understand, Mr. Deputy Speaker. I would not dream of quarrelling with you, but I am bothered by the motion's wording. The Standing Committee will debate the use of the money when it considers the relevant clause, but the House should not write blank cheques to whichever organisations the Committee inserts into the Bill. It is a question not only of the amount of money involved, but the purposes to which it is put. I do not like the fact that the motion uses the phrase "any increase attributable". I should prefer it to be specific.
I hope that the Minister will live up to his justified reputation, and that he will prove it to anyone who has doubts about his ability, integrity or sincerity by saying that he understands the error of his ways and will use his influence to put the matter right. He should guarantee a maximum amount, and limit the purposes to which the money is put.
I declare an interest as a member of a trade union. I congratulate my hon. Friend the Minister on the motion before us. It is a money resolution, and I am sure that it will be subjected to some debate in Standing Committee, but I am surprised at the anger that it has generated among Opposition Members, which means that my hon. Friend must be getting something right.
I expected that the process of modernisation—of trade unions or business—would be supported by the House as essential in a modern society. The Government have given considerable amounts of money towards the modernisation of business, with the support of hon. Members of all parties, including those who belong to trade unions. Sums have been mentioned of between £5 million and £10 million. For obvious reasons, I should like the amount to be much higher. The modernisation of trade unions is essential.
In the dark days of the distant past, trade unions often used to act in ways that could not be called honourable. The trend is different today. Trade unions have earned the right to support for modernisation that is vital in today's world.
Any press release that I put out expressing my support for the money resolution would be supported by my constituents. I am sure that the hon. Gentleman will put out a press release that says something entirely different, but that is his business.
The money being set aside in the motion is important. I do not want to stray out of order, but my hon. Friend the Minister made it clear that the £5 million to £10 million will be used for trade union modernisation. It is not a bung, as has been claimed. To my surprise, the Liberal Democrat spokesman, Malcolm Bruce, supported the use of that word, although in a different context. If the money is used for training union representatives, I hope that Opposition Members will be in favour of those representatives getting the best training possible. In that way, they will understand the problems facing unions trying to support the businesses that are essential to the country's future.
I hope that we can debate the money resolution again, although I know that the Minister may not agree.
There is no need for the Government to come back to the House to increase the figure, as it is unlimited and has no ceiling. The Government could pay £15 million, £20 million, £30 million, £40 million, £50 million or £60 million a year, if they wanted to.
I am delighted by that interpretation. I hope that the Minister agrees with it, but suspect that he does not.
I remind the House that the Government have given 83,000 loans to small businesses, worth £3 billion. There is also a bad-debt provision worth £116 million over the next 10 years. We should compare that with the £5 million to £10 million that is being proposed today.
Order. I think that the hon. Gentleman knew that he was trespassing outside the confines of the debate. I have allowed a wide scope for the debate on the money resolution, and I have given the hon. Gentleman fair opportunity to rebut points made by Opposition Members. I hope that he will confine his final remarks to the money resolution itself.
On a point of order, Mr. Deputy Speaker. The House will vote on this motion in a few minutes, and I seek guidance from you. It is clear that hon. Members who are sponsored by trade unions could benefit directly if the funds to be voted on this afternoon prevent the need for an increase in trade unions' political or other funds. Would it be proper for those sponsored hon. Members to vote in the forthcoming Division?
This has been an interesting debate. I am sorry to say, however, that it has not been a surprise. Parliamentary procedure requires a money resolution if public expenditure is attached to a Bill. It is not unusual for a Bill such as the Employment Relations Bill to change as it proceeds through Standing Committee. It is therefore proper to have a debate on the money resolution, and the details can be reviewed in Standing Committee, on Report and at Third Reading.
I am surprised at the response from Liberal Democrat Members, as the key elements in the Bill are information and consultation. It aims to change the culture of industrial and employment relations in the UK. I expected some Labour Members to ask why we are calling it a modernisation fund, given that the unions are doing a good job already. However, there has been a complete change since 1997 in the way that unions and employers work with each other. The information and consultation directive—the framework agreement arrived at by the TUC and the Confederation of British Industry—is a perfect example of how we want things to continue in the future. I utterly refute the attack that the fund has anything to do with the funding of the Labour party.
It is interesting that Conservative Members have forgotten the time when the Conservative Government gave £24 million to trade unions for political fund ballots and £28 million to trade unions for education. Conservative Members have lost the foresight that their predecessors had to make sure that trade unions are involved in education. We know that they are not interested in good industrial relations: at the Tory party conference, the director general of the CBI said that the Conservative party could no longer be guaranteed the support of business because it looks backward rather than forward.
People will bid into the fund, and it is difficult to state the exact details until the bids are forthcoming. It may be that match funding will be required in the bidding process, which would mean that unions would have to put in some money as well. The scheme is similar to the partnership fund on which trade unions and employers have come together successfully.
Let me turn to the £5 million to £10 million figure. Unions spend about £800 million each year. Assuming that 5 per cent. of that figure—about £40 million—equates to investments by unions in their futures, the fund could support a 10 per cent. increase in such union expenditure over a two to three-year period, which is how we reached the £5 million to £10 million figure.
I thank Conservative Members for protecting my integrity, although I am sure that Labour Members will call into question my relationship with them. The fund is genuinely about good employment relations and good industrial relations. We understand that the Opposition parties would like to have a kick about with the money resolution. However, the Committee will discuss the matter, there will be another debate on Report, and hon. Members will have an opportunity to examine the details over the summer. [Interruption.] Quieten down. After hon. Members have examined the details, they will support the modernisation fund if they truly want good industrial relations and good employment relations in the UK in the coming years.
Question accordingly agreed to.
That, for the purposes of any Act resulting from the Employment Relations Bill, it is expedient to authorise the payment out of money provided by Parliament of any increase attributable to the Act in sums payable out of money provided by Parliament under any other enactment.