Work and Families Bill

Part of the debate – in the House of Lords at 6:30 pm on 25th April 2006.

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Photo of Baroness Miller of Hendon Baroness Miller of Hendon Shadow Minister, Trade & Industry 6:30 pm, 25th April 2006

My Lords, I should like to speak to Amendments Nos. 13 and 14 together. Both relate to the phasing-in of the Government's proposal to make the eight days of bank holiday enjoyed in England and Wales paid holidays, thereby adding a week and a half to the existing four weeks of paid leave to which every employee is currently entitled. We certainly do not oppose this concept, which is a Government manifesto commitment. However, adding an extra 40 per cent to the entitlement to paid leave is undoubtedly a big bill to expect commerce to swallow in one gulp. It would be particularly difficult for small and very small businesses.

As the CBI pointed out to the Government, commerce and industry need time to absorb the extra cost and overhead in medium-term business plans. The Minister promised to consider phasing in the additional leave when they consult on implementation. He said that consultation would take place shortly. How much consultation is really needed among interested parties? We already know the CBI's views. It is unlikely that other employers will insist that they take the eight days all in one go. We can assume that it is more likely than not that the unions will want the benefit sooner rather than later. Perhaps the Minister could write to me later to say how many people have been consulted in the past seven weeks and with what result, and who is still left to reply to the consultation.

I regret to say that I cannot accept the Minister's argument that phasing,

"may place an excessive burden on business by changing the rules every year for four years".—[Official Report, 9/3/06; col. GC390.]

With the greatest respect to the noble Lord, the administrative inconvenience of adjusting to and paying an extra eight days' wages over four years is more than outweighed by spreading the additional overhead rather than having to pay it in one big lump. In reality, how difficult will it be for even the smallest corner shop or market trader to understand that in year one, Christmas day and Easter Monday have to be paid for, in the next year it is the May and August bank holidays, and so on? It could easily be worked out. That is my point.

I was suspicious in Committee that the Government were far from keen to bring in the measure in stages. They promised the trade unions in the so-called Warwick agreement that it would be a measure for this Parliament. However, I am now heartened—slightly heartened—by the statement in the government paper Success at Work, which quietly crept out last month, in which they said:

"We will examine all the appropriate actions, including how the change might be phased in over time".

That statement provides two loopholes, which is why I am only slightly heartened by it. First, it refers to how the changes "might be phased in" and, secondly, it makes such phasing in subject to the Government's consultation—I have already commented on that.

At this point we do not have an assurance that, having passed the Bill, the Government will not decide not to phase in the additional week and a half paid holiday. Even accepting the amendment, the Government will be fulfilling their pledge still to meet the commitment in the theoretical lifetime of this Parliament. In calling for the measure to be phased in over that four-year period, we on this side are not departing from the Salisbury convention about respecting manifesto pledges. The Government can consider that amendment separately, and I sincerely hope that they will do so.

Amendment No. 14 is intended simply to concentrate the Government's mind and get them to decide when the extra days' paid holiday will come into effect—whether it is this year, next year, or whenever. It is a sunset clause to terminate the provision about the eight extra days' paid holiday if the Government do not legislate by 31 December 2007. That gives them plenty of time to sort out the matter.

I have already commented on the length of what I should have thought was a relatively simple question to comparatively few consultees. I have provided what I believe is a generous period—well over a year and a half—for the Government to decide whether they will bring it in all in one go or phase it in. I would be satisfied with a final decision on when the measure is to come into force and a firm timetable. The Government may decide that they must continue with the consultation, in response to my first amendment, but my second amendment is really easy, as they ought to be able to commit themselves to something happening within the next year and a half. If they cannot do that, it makes the whole thing rather difficult. I beg to move.