My Lords, in moving Amendment No. 1, I speak to the consequential amendments in the group.
As I explained in Committee, the amendment inserts additional wording into the Social Security Contributions and Benefits Act 1992 to enable foster parents who have become adoptive parents on a concurrent scheme to be entitled to adoption pay. Amendments Nos. 4 and 5 ensure that similar provisions are added to Clauses 4 and 7 enabling them to qualify for additional paternity leave for adoption and additional statutory paternity pay for adoption.
Since Committee, I have tried to take into account the Minister's comments and have included Amendments Nos. 7 and 8 to Schedule 1 to try to ensure that these provisions would also be included in an entitlement to adoption leave and ordinary statutory paternity pay for adoption in the Employment Relations Act 2006.
For noble Lords who may be unaware of the concurrent planning schemes, they are bold initiatives aimed at the least possible disruption and upheaval to the baby, and yet the risks potential adopters face are enormous. Potential adopters are approved both as foster carers and adopters for the same child. The baby, or child, is placed with them on an interim foster basis while the birth family is assessed. If it is established that the baby or child cannot return to his birth parents, the placement is converted to an adoption application. However, as the law currently stands, the adoptive parents are not eligible for adoption leave or pay, nor are their rights to return to work protected. We on these Benches are the first to recognise the requirement to balance out the needs of the family and employers in this delicate situation. In Committee, I welcomed the Government's recognition of the important role that concurrent planning schemes can play.
The Minister stated that the Government wish to consider in more detail how statutory pay and leave entitlements apply and what further legislation and guidance might be required. He also said that officials and lawyers from the DWP and the DfES are working jointly on the matter. Can the Minister inform the House what progress has been made on this issue since Committee? What discussions have the officials had with organisations such as BAAF as well as those running the schemes?
I would also like to take the opportunity to share the feedback I have had since the Committee debate on the industry. I am predominantly repeating its words. It says that it picked up on the correct reminder of the noble Lord, Lord McKenzie, that concurrency carers will already have had a period at home where they have received fostering allowances when applying to adopt their child. However, the experts highlight that the fostering payments may have been less than individuals might have received if they had been entitled to statutory adoption pay. In addition, while individuals were fostering, they would have been acting as carers not as parents—for example, bringing the baby to the office for contact with its birth family for up to five times a week and attending statutory reviews.
Once the child's placement is converted to an adoption placement, the prospective adopters will need a period to relax and develop their role as parents without the pressure of the constant fear and uncertainty that the child may be returning to its family. Coram, the charity leader in this field, suggests that these parents should receive statutory adoption pay for a period in recognition of the fact that at this stage they need mentally to shift gear to allow them to deepen their emotional bond with their child. The other issue it wants to highlight is that concurrency carers do not have their right to return to work protected, as is the case for adopters. That is because the placement of their child is initially made on a fostering basis.
However, the reality is that concurrency carers are not making a long-term commitment to be foster carers. They are committed to fostering only until the courts decide on the long-term future of a particular child placed with them. At the end of that period either the child will return to its birth family or it will be adopted by the concurrency carers. In the first scenario, the currency carer will lose the child and the fostering allowances. If they do not have a right to return to work, they will be left not only without a child but also potentially very disadvantaged in terms of their employment and career.
In the second scenario, the adopters will wish to make decisions about the right time to return to work, just as any other parent would do. In either case, I believe that the Government need to look again at the balance between the needs of employers and the concurrency carers, who arguably should have the right to return to work. One way to do that may be to establish concurrency as a sub-category of foster carers, in order to enable them to be treated differently from other foster carers in this regard. Concurrent planning schemes are still in an embryonic stage, but they produce a number of advantages, with 90 per cent of these schemes having already been successful and leading to adoptions, giving vulnerable infants the nurture and security they desperately need.
I very much hope that the Minister can comment on the industry's point in his reply and give his commitment that this issue will be looked into fully and properly. I beg to move.
My Lords, I am right behind the noble Baroness, Lady Morris of Bolton, on this group of amendments. Although concurrency planning is still at an early stage, the evidence is outstanding that it is in the best interests of the child and is highly successful. We need to give it a boost at this early stage. Although we have the interests of employers in mind, the numbers that we are talking about are relatively small and the parents should be considered, as closely as we can, in the same way as birth parents and adoptive parents in order to encourage more people to move along this particular route from fostering into adoption. The idea that such people, who take on this onerous role out of kindness and concern for children, should put their future employment status at risk is quite horrifying. For that reason, I am very firmly behind the amendments, and I hope that the Minister has had an opportunity since Grand Committee to consider this whole issue further and will be able to reassure us that such people will not suffer that sort of disadvantage. Perhaps he may even be encouraged to table amendments himself of the sort that the noble Baroness, Lady Morris of Bolton, has tabled.
My Lords, I shall speak very briefly in support of both noble Baronesses on the amendment. Four years ago, a colleague of mine and his admirable wife adopted three severely damaged little girls. Over the four years in which they have looked after them, I have watched the incredible improvement in those children, which depends on the dedication of those two parents. I really do think that we as a society should show appreciation to the people who take on that kind of work.
My Lords, I, too, shall speak very briefly in support of the amendment. It makes absolute sense. Indeed, the people who take on this responsibility are doing so for the good of the community, which will end up with more responsible and better adjusted adults—and, my goodness, we need them. I very much hope that the Minister will think again.
My Lords, I start by thanking the noble Baroness, Lady Morris of Bolton, for bringing this issue back on Report, and other noble Lords who have spoken in the debate. The noble Baroness hoped that we had made progress since Committee, and I hope that what I have to say will indicate that I believe that we have. Since Committee, officials from the DTI, alongside officials from the DfES, have been considering the regulations, and officials will consult stakeholders, including agencies and employers, as the next step.
When we discussed the matter in Grand Committee, I said that we would carefully consider the way in which concurrent placements were operating to see how the existing legislation on statutory adoption pay and leave might affect them. As we agreed in Grand Committee, there is no question that the role played by adopters in society is tremendously important. That is why this Government introduced, for the first time, the entitlement to statutory adoption pay and adoption leave in 2003. We are proud of having done so. Thousands of children and families have benefited as a result. The Government strongly support concurrent planning. Although only four adoption agencies currently operate the concurrent planning model, and although the numbers of adoptions by concurrent carers is relatively small—figures suggest that children adopted in this way have represented about 0.3 per cent of all looked-after children adopted in England—the benefits to children are in no doubt. Concurrent planning reduces the number of placements for children, identifies potential permanent families early on, reduces placement disruption and cuts the time needed to reach adoption where this becomes the plan.
The statutory adoption pay and leave regulations were drafted in line with the policy rationale for the new entitlements—that is, to support adopters in taking time off work when a child is first placed with them. This helps the adopter and the child to adjust to their new relationships. The Government's view is that this helps to reduce the number of disruptive placements and improves the life chances of looked-after children. We deliberately excluded adoptions—for example, adoptions by step-parents—that take place outside the formal process. In Grand Committee, I informed the noble Baroness that officials were examining the detail of concurrent placements and how that sat alongside more conventional adoption arrangements for statutory pay and leave. These detailed considerations continue. However, I am pleased to be able to tell the noble Baroness that officials have now concluded that we see no reason why such adoption arrangements are not compatible with the existing legislation setting out eligibility on adoption leave and pay. In concurrent planning arrangements, there is, as in more conventional adoptions, a readily identifiable date by which the adopter is matched with the child for adoption and by which the child is placed for adoption as required by the statutory adoption pay and leave regulations. That also fits the policy rationale for leave and pay.
During the rehabilitation plan, the child will typically spend time with both the birth parents and the foster carers. In the event that the adoption plan is implemented, we recognise that the nature of the relationship between child and adopter changes and it becomes more permanent, which is precisely the point made by the noble Baroness. We are still looking in some detail at the administrative arrangements and will need to consult employers and other groups on any changes that they might consider necessary, including what further guidance might be appropriate. The low numbers involved mean that it is likely that general awareness is not high. It is important that employers are given clarity over who is and is not included in the definition. Once that work is concluded, I would be happy to write to the noble Baroness with a further update and to let her know what changes we consider necessary to the official guidance.
The amendments tabled by the noble Baroness would obviously amend primary legislation. We do not consider such amendments are necessary in this case to achieve the desired effect. I should also point out that there is still a small drafting error in the amendments. While they would make changes in respect of statutory adoption leave and pay, and for ordinary paternity leave and additional paternity leave and pay, they would not, however, make the relevant change to the ordinary paternity leave adoption legislation that would be necessary in order for the employee to take the pay.
Given that we appear to be in agreement over the effect that we wish to achieve and given the need for us to conclude our analysis of existing administrative and guidance arrangements, I would ask the noble Baroness to withdraw her amendments. We have concluded that we do not need to change existing primary legislation for that to happen. As I have explained, a fuller analysis enables concurrent planning to be adopted in current legislation. I hope that that will satisfy the noble Baroness.
My Lords, I thank the Minister. As he can see, I have a smile on my face. I thank all noble Lords for their support. It is a matter which I and all noble Lords feel strongly about. It is true that it is early days for concurrency, which is well established and successful in America. It will reap tremendous rewards in this country. I thank the Minister for agreeing in principle. I have never pretended to be the best parliamentary draftsman. I fully accept that it is not necessary to amend primary legislation. Will regulations then come before the House? Will we have another chance? How will this happen? Can the noble Lord comment on that?
My Lords, I believe that if the conclusion is that the regulations as currently drafted cover the position, nothing specific will be put forward, although the guidance notes will need to be amended to reflect the conclusion. I will write to the noble Baroness and all noble Lords who have spoken today in order to update them on how we take this matter forward. It is important that noble Lords are fully satisfied that what they wish to achieve is encompassed in what the Government propose putting into effect.
moved Amendment No. 2:
Page 2, line 10, at end insert—
"(1A) For the purposes of subsection (1)(b) and (c), the relationship with the child is that the employee has parental responsibility for the child or has made in some other form to be set out in regulations under this section a commitment to care for and support the child on a continuing and long-term basis."
My Lords, Amendment No. 2 concerns the definition of the person who is to be considered as a father for paternity leave. It is a probing amendment and I should like to thank the noble Lord for his letter on the subject, which has enabled me to table this amendment. In a nutshell, the Government's argument for the definition proposed in the Bill is that the present definition for ordinary paternity leave is working well, so why change it? It may be worth considering whether this is a valid reason for assuming that there should be no change and for assuming that the same formulation will work equally well for this six-month period of paid additional paternity leave. Obviously, for the latter, the stakes are much higher. We are talking about a big amount—perhaps 10 times as much money. Therefore, there may be the greater temptation to dishonesty.
However, this is not the argument that I want to advance this afternoon for my amendment. I want to raise what I believe to be a more important issue. We are all agreed—and the Government agree—that our concern in this Bill must be to enhance the well-being of the nation's children. As your Lordships all know, there is today ample good research showing that the presence of a committed father or a father figure in the life of a child is likely to increase the child's well-being and his chances of success in education and in later life. So should we be taking every opportunity to increase the probability that fathers will make a commitment to their child?
It is not clear what the existing proposed tests as printed in the Bill mean. It says that the person in question must be responsible for the upbringing of the child. What do those words mean? Do they mean that he may or will for the period of six months help to look after the child, as a kind of childminder, or does it mean a long-term commitment by that man to that child?
In order to find out and perhaps to propose a solution to that point, I have inserted the words "parental responsibility". Parental responsibility implies a long-term commitment to the child. It may not be perfect; it may not always work, as in a marriage, but at least there is a commitment at the beginning. To have paternal responsibility in law, a father must either be married to the mother or have signed the birth register of the child or obtained paternal responsibility by application to the courts. Each of those is a positive act of showing commitment. Obviously marrying the mother or signing the birth register implies such a long-term commitment, but there may be reasons why a man does not want to marry. However, signing the birth register is something that any reasonably committed father should want to do for his child.
Conversely, any father who cannot be bothered to turn up and sign the birth register might be considered an unsuitable person to look after the child on his own for six months. A person who is not married and has not signed the birth register has to appeal to the courts to obtain paternal responsibility, but there is no such condition for a person who signs the birth register—he is free to walk in and do so. It is an option open to every father.
My contention is that if parental responsibility were part of the definition to qualify for paternity, that would be a powerful incentive to encourage any father who had the slightest intention of being a good father to sign the birth register. Fathers who do not bother to do so are scarcely likely to be suitable. I have inserted a second part to my amendment, which is a kind of failsafe. It may be that as time goes by there will be other ways in which fathers can signify their commitment to their child. For example, a draft Bill was introduced in another place by Frank Field for naming ceremonies for a child in which a formal commitment to the child would have been given had the Bill proceeded.
My argument is that the amendment should lead to more unmarried fathers taking seriously their duties to their child and to the greatly increased well-being of some of the nation's children as a result. The Government should have a record of all those who have parental responsibility, so it does not seem that any great administrative problems will be involved. I beg to move.
My Lords, it is impossible for me to add to what the noble Lord, Lord Northbourne, said. He said it so well that no one could argue with the benefit that would arise when the man takes responsibility, and when the child knows that the man willingly takes responsibility as a father during his growing years. We support the amendment.
My Lords, I too support the amendment. The purpose of the noble Lord, Lord Northbourne, in trying to clarify the relationship about which we are talking between the man and the child is commendable. Of course, none of us can ensure that, by a piece of legislation, what a man says or does when the child is born or is young is something that he will follow through with for the rest of the child's life. However, the more that we can do to have him make that commitment the better, and the more likely he is to follow through. Children need fathers and as much contact with the father as possible.
There may be a very good reason why the man is not able to marry the mother of the child—he may be married to somebody else—but that does not disqualify him from taking a real interest in the child and the child having the right to know who the father is and to make a relationship with him. I certainly welcome this attempt to clarify what the relationship should be. Whether it is accurate in terms of parliamentary draftsmanship I do not know, but I certainly support its purpose.
My Lords, I, too, support what is clearly behind this amendment—it will be behind quite a number of the amendments—to encourage the father's parental role in supporting the child right through life. I am also a little worried about whether it is drafted in the right way and whether it is actually necessary, but this debate will no doubt help to clarify that point for us.
My Lords, I thank the noble Lord, Lord Northbourne, for bringing this issue back before us. I hope that the correspondence that ensued between Grand Committee and today was helpful to him. I also thank other noble Lords who have spoken.
As I outlined during Grand Committee and Second Reading, existing paternity provisions require that, for a father to qualify for paternity leave, which will now be known as ordinary paternity leave, he must—in the case of the birth of a child, rather than an adoption—be the father of the child, or be married to or be the partner including civil partner of the child's mother, and be responsible for the upbringing of the child. That definition was consulted on prior to the introduction of paternity leave in 2003, and was accepted as a reasonable definition that encompassed a wide range of fathers who would be supporting the mother or caring for the child after the birth of the child. The definition clearly outlines who could be eligible and has been accepted as a reasonable and widely understood relationship criterion.
When claiming statutory paternity pay, a father must complete a signed declaration that he is taking time off work to care for the child and support the mother or both, that he has or expects to have responsibility for the upbringing of the child, and that he is the father of the child and/or the husband or partner of the mother. It has been, and still is, our intention to adopt the same relationship criteria for fathers to be able to take additional paternity leave—subject to other qualification criteria—as we believe that these are the right criteria and we have no evidence to prove otherwise. We do not want to upset the proverbial apple cart by adopting different criteria from those applied to existing paternity leave, and we do not believe that changing existing paternity leave criteria would be the best approach to keeping things straightforward for employers as well as employees.
We have no evidence that the existing criteria cause significant problems. We want to help both employees and their employers to understand who is eligible and keep the scheme as straightforward as possible. Having the same definition for the additional paternity leave scheme would achieve this.
We set out our intention to adopt the same relationship criteria in our consultation published on
For civil partners and step-parents, the procedure would involve either agreement between the step-parent and the child's parents or court proceedings to obtain parental responsibility. Court proceedings could take additional time and may not be completed before the point at which the parent would like to start his additional paternity leave, which may be as early as 20 weeks after the birth of the child.
The amendment suggests a second way in which a father could qualify—if he makes a commitment to care for and support the child on a continuing and long-term basis. How this commitment would be made is unclear from the amendment and it is difficult to see how it could be any firmer than the implied commitment under the existing definition that I outlined earlier. To require a person to go through this process of obtaining parental responsibility or in some other way confirming a commitment before being able to take paternity leave and pay would, I suggest, be onerous and would impact on the number of people eligible to take this leave and pay, and could reduce the number of people taking up this provision.
While we agree that it is important for a child to have continuous care beyond the first year of its life where possible, we also have to be realistic about the changes that can occur over time—the break-up of relationships, or change of partner, to name but a couple of circumstances. Additional paternity leave and pay is intended to allow fathers an opportunity to care for a child where they are responsible for that child's upbringing, so it should be available to the most appropriate person. I envisage that in the majority of circumstances the person claiming ordinary paternity leave would be committed to long-term responsibilities, as was thought at the time of its introduction in 2003. Therefore, if the same definition is adopted, we consider that the person claiming additional paternity leave and pay would, in the majority of cases, also intend to care for and support the child on a long-term basis. We would clearly want to see and support that.
The existing definition of a father is included in regulations rather than in primary legislation for ordinary paternity leave, and we intend to follow this approach for the eligibility criteria for additional paternity leave. We will develop secondary legislation once the detail of the policy is finalised, following further consultation and consideration. These regulations will be the subject of consultation and will be made by the affirmative procedure. We therefore have the time to ensure that this issue is discussed fully as the policy develops and is reviewed. We want to make sure that we get this scheme right and I can assure noble Lords that this issue will be considered fully.
In conclusion, we understand the thrust of the point made by the noble Lord. However, we hope that he will take the point that parental responsibility issues are not necessarily straightforward and can in certain circumstances be time-consuming. If that were the key criteria, that could preclude, within the timeframes necessary for these provisions, certain fathers having the opportunity of participating in these arrangements. It is certainly important that we align the definition so that ordinary paternity leave and pay are matched with the additional paternity leave, otherwise it will be a minefield. I am sure that all noble Lords would accept that. The consultation has not yet finished so we will have to await its final outcome, but we think that to proceed, as the noble Lord suggests, in terms of enshrining this in primary legislation is not the right way forward, for the reasons that I have outlined.
My Lords, I am most grateful to the Minister. I am always sceptical about consultation, especially when I have not been consulted. I wonder whether the Minister could arrange for me to have the relevant documentation and I will express my views to the consultation, although I dare say it will not make much difference.
The noble Lord omitted to comment on one of the points I made, which was that this proposal would increase the number of fathers who would take up parental responsibility. Different definitions can cut both ways. The definition of parental responsibility in the 1989 Act is the key definition of a father. It would be much better if the Government did not keep introducing in new legislation definitions of "father" different from those used in the Child Support Agency and Anti-social Behaviour Acts. We now have four or five different definitions of a father, which is helpful neither to us nor to fathers.
My Lords, perhaps I may reiterate a point. Our concern is that using this definition would potentially restrict the number of people who could benefit from these arrangements. For good or ill, we already have the definition in respect of ordinary paternity leave and pay. Our concern is that if that were the key criterion, because of the practicalities in some circumstances it would be a more restrictive test. It is quite probable that parental responsibility will align itself with the current definition over a whole range of circumstances and there will be no difference, but to require this technical provision is, we think, potentially restrictive.
My Lords, I can see that I am not going to win the argument. The final point I want to make is that I would be most grateful if the Minister could let me see the document the person will have to sign. Everything is in the detail here. If the person is committing himself to a long-term relationship, I would have no further problem with this. In the mean time, I beg leave to withdraw the amendment.
moved Amendment No. 3:
Page 2, line 46, at end insert—
"( ) Regulations under this section shall provide for the mother to provide written confirmation that the person claiming additional paternity leave has satisfied the conditions in subsection (1)(b) and (c) and is the only person claiming it; and the employer concerned shall be entitled to rely on that confirmation without being required to make further enquiries as to the matters in subsection (1)(b) and (c)."
My Lords, this amendment seeks to provide a partial definition of who is entitled to what the Bill calls "additional paternity leave", especially for the enlightenment of the employer, a point I shall explain later. In moving a similar amendment in Grand Committee, I made the point that while the old proverb tells us that it is a wise child who knows its own father, an employer needs to be far wiser to know which of possibly more than one putative father qualifies for the benefit of additional paternity leave.
It is not difficult to envisage a scenario where the mother is not actually living with the father of the child or where the biological father is not the one performing the parental duties laid down in subsection (1). In his response to my amendment and to a similar one proposed by the noble Lord, Lord Northbourne, the Minister acknowledged the need for a clear definition of the person who is to be the beneficiary. But he went on to insist that,
"the sensible approach would be to set out the definition in secondary legislation".—[Official Report, 9/3/06; col. GC 342.]
I am by no means convinced that that would be the best approach, but given the Government's predilection for bringing forward skeleton legislation fleshed out by regulations, we have to make do with what is on offer.
I have absolutely no doubt that skilled parliamentary draftsmen in the DTI will be able to produce an elegant, cast-iron, waterproof and totally unambiguous definition of who is entitled to claim the benefit, but that is not the problem—or rather the dual problems that this amendment seeks to address. As drafted, the clause looks at the matter only from the point of view of the claimant. However, in theory more than one person could seek to claim the benefit, but of course only one could rightly be doing so. How is the employer to know what his employee is properly entitled to? How are two separate employers who do not know each other, or even of each other's existence, to know that two separate claims are being made by two different people? One claim could state, "My wife has just had a baby", without disclosing that the couple have since separated. Another claim could state, "My partner has just had a baby", without disclosing that the biological father was carrying out the duties laid down in subsection (1). There are several such permutations that we do not need to discuss now, but the simple fact is that the employer does not have the means of verifying the validity of the claim, nor should the onus of doing so be put on the employer. That would include verifying that the claimant is actually performing the qualifying duties.
The second aspect of this amendment would ensure that an employer who has granted additional paternity leave in all good faith does not find his claim for reimbursement rejected by the Government when their computer discovers that there are in fact two claimants.
I was pleased to see that the Minister conceded in his reply that, after consultation, self-certification was the preferred option.
However, the Minister went on to explain that,
"We want to minimise . . . contact between the mother's employer and the father's employer".
This amendment avoids the necessity of any such contact. The Minister also pointed out that,
"the mother could not confirm the length of service a father had provided to their employer, or provide confirmation of the father's earnings, which are also eligibility criteria".—[Official Report, 9/3/06; col. GC 343.]
This simple amendment resolves both objections. The mother will provide a simple certificate, presumably in a form prescribed by the intended regulations which could, for example, say, "I, ABC, hereby certify that Mr XYZ is responsible for the upbringing of my child, PQR, born on such-and-such a date. I also confirm that this is the one and only such certificate that I have given in relation to this child". I am reminded of the story of a Victorian barrister who drafted a defence in a paternity case, in which he pleaded that,
"the defendant denies that he is the father of the twins, or either of them".
I suppose that is the same certificate which could cover multiple births.
The noble Lord, Lord Northbourne, expressed considerable concern both in Grand Committee and in a later letter to the Minister about the problem of identifying a legitimate claimant to the benefit; I entirely concur with him on that. Indeed, the Minister's colleague in the other place, Meg Munn, the Minister for Women, admitted in an article in the press that, as things stand, the whole concept of extra paternal leave is a possibly fruitful field for fraud. As things stand, we still have no assurances about solving this problem—which, as I have said, is fully acknowledged by the Government—except for the promise that it will be dealt with in some future regulations.
In a welfare system which has shown itself prone to all the frauds that ingenious minds can devise, we should not accept the existence of yet another open door. In this case, "jam tomorrow" is not acceptable. By now, the Government have had ample time to come up with a concrete proposal to solve the problem which they acknowledge exists. Amendment No. 3 substantially reduces the risk of such fraud, especially if the prescribed form of certificate includes a warning, in bold red ink, of the consequences of issuing a false certificate.
I repeat; this amendment does not diminish the right to additional paternity leave. It does not interfere with or even modify any definition that the DTI may produce of the qualification of such leave. It does not require the mother to investigate the qualification of the person carrying out paternal duties vis-à-vis his employer, nor does it require the employer to make any inquiries about the domestic arrangements of the mother—or even about her relationship with the claimant. In other words, as the Minister requested, it is the essence of simplicity, which I have no doubt will be appreciated by employers and fathers alike. Only yesterday, I received supportive comments on this amendment from, on the one hand, Working Families and, on the other, the Federation of Small Businesses. I beg to move.
My Lords, I support this amendment as I did in Grand Committee—not because I go along with the dire warnings of the noble Baroness, Lady Miller of Hendon, about the possibility of fraud. That was certainly the main thrust of her argument, if not the only argument. The likelihood of fraudulent claims over additional paternity leave is quite low. Few fathers entitled to such leave are going to be earning less than £108.85 per week, so they will have little interest in making such a fraudulent claim.
However, I certainly go along with the noble Baroness' claim that Amendment No. 3 provides a system which benefits from being beautifully simple—her actual words were "the essence of simplicity". I doubt whether employers will fulfil their part of the system that the Government are proposing in the Bill. There is currently a requirement on employers to write to the mother within 28 days of receiving notice of the date that she wishes to start maternity leave, and the employer's letter should state the date she is due back at work. Working Families tells me that many callers to its helpline do not receive such a letter and therefore are uncertain about the date of their expected return to work. If employers cannot even write to their own employees about such a crucial matter as the date when they should be returning to work, it certainly raises questions whether they will certify a statement that will affect the father, who is unlikely to be their own employee.
For those reasons—the greater simplicity and the fact that the measure would not rely on the employer and would be even less of a burden on them—I am very supportive of the amendment.
My Lords, this is a very ingenious solution to what is clearly a problem, so I support the amendment. The very fact that the onus would be on the individual to make the claim would reduce the burden on the employer. Further, there at least would be a basis on which suspected fraud could be investigated.
My Lords, I thank the noble Baroness, Lady Miller of Hendon, for raising the matter again. I also thank other noble Lords who have spoken. I fear that I may not be able totally to satisfy noble Lords on the matter but we start with an agreement that we want a system which is robust but light touch, and that there should not be undue burdens, particularly on employers.
The consultation on additional paternity leave and pay was published on
As I mentioned in Committee, but I think is worth reiterating today, the Work and Families: Choice and Flexibility consultation, published in February 2005, asked for views on the procedure for administering the transferable leave and pay scheme, which was being considered at that time. Three options were given. These were: self-certification by the mother and father of their eligibility; self-certification by the parents combined with confirmation by the mother's employer; and Inland Revenue compliance checks, which would require Inland Revenue—now Her Majesty's Revenue and Customs—to undertake an additional check to ensure the accuracy and integrity of the system.
From that consultation it became clear that self-certification by the mother and father of their eligibility, with confirmation from the mother's employer that the mother was entitled to maternity leave and/or pay and had notified her intention to return to work, was the preferred option as it provided a balance between keeping the bureaucracy to a minimum while limiting the potential for errors in payment or abuse of the system, through providing an additional check by employers. This principle can also be applied to the administration of the additional paternity leave and pay scheme.
It is recognised that contact between the mother's employer and the father's employer could increase significantly the burdens on employers and we believe that this can be avoided, but we want to ensure that this is what employers and employees also want and the current consultation should lead us to establishing the wishes of employers and employees.
I respectfully suggest that to pre-empt that now would not be the right way to proceed, when there is still some way to run on the consultation and when we have not yet fully gathered the views of employers and employees. The most straightforward approach would be to build on existing administrative arrangements for maternity and paternity leave, which should mean that many employers already have an understanding of the system and will not have to learn new procedures. If as the noble Baroness, Lady Walmsley, suggested, those procedures are not working properly, I would be pleased to receive further detail on that, and I will certainly have the matter looked into. There is no evidence that existing maternity and paternity schemes experience high levels of fraudulent claims or errors in administering payments, and we do not envisage that happening under the additional paternity leave and pay scheme. However, we recognise that we need to consider how to minimise abuse of the scheme as we develop policy. We do not want to make any hasty decisions. I am conscious that this has been around for a little while, but we really are partway through the process.
I noticed the noble Baroness referring to a press article. I have not had the chance to discuss it with my colleague from another place, but I am not sure that it would necessarily accurately reflect her view. I cannot be certain on that.
Nevertheless, the consultation is still open. We do not want to make hasty decisions about who is responsible for providing certain information and how that information is exchanged until we have had time fully to consult and explore the options. This aspect of the scheme should be dealt with in the regulations that will follow, and I assure noble Lords that the issue will be considered fully before the regulations are finalised. Therefore, I ask the noble Baroness to withdraw her amendment, since we are still partway through this process.
My Lords, first, I thank both noble Baronesses who supported the amendment. I say to the Minister, who suggested that I might not be very happy with his reply, that I am not sure he will be happy with my response to it. I shall have to read Hansard carefully to be absolutely certain, but I think that he said something to the effect that employers would not be particularly happy and they would find it complicated if they got notification from the mother that their employee was the father. That is quite contrary to what those who have briefed me have said. I will take to them what the Minister said, and I will bring this back again at Third Reading.
Given that the consultations will finish after the Bill has passed and the regulations will come in even later, we are having to pass this Bill at a very early stage, which is not the correct way of doing things; even more so with a Bill that had a Grand Committee stage when we could not divide. The first opportunity to explore it properly is Report stage, which would be the normal time when we would divide rather than go to Third Reading. However, in these circumstances, I want to take away what the Minister said. I absolutely reserve the right to bring this back at Third Reading, because it is unsatisfactory. The consultations are not finished, and the regulations will not come until later.
I heard exactly what the noble Baroness, Lady Walmsley, said about fraud, but I refer her to the Sunday Times article of
"Ministers have been forced to", that the noble Lord has not consulted Meg Munn. I would have thought that he would have done so, so that we could have had a definitive answer. We all know that newspapers do sometimes get things incorrect. I beg leave to withdraw the amendment.
moved Amendment No. 6:
Page 16, line 5, at end insert—
"(5) If during the period referred to in subsection (1A) a woman receives a payment which qualifies as earnings but which relates to a period which exceeds the period in that subsection, the earnings which constitute that payment shall be considered as accruing from day-to-day and shall be apportionable in respect of time accordingly.""
My Lords, in Committee I introduced the same amendment. It would reverse inequalities among employees and reduce the unnecessary cost to the taxpayer brought about by the current rules. The rules require employers to include full annual bonuses in statutory maternity pay calculations where the annual bonus is paid to the employee in the eight-week period used to calculate statutory maternity pay. The vast majority of employees will receive their bonus in the remaining 44 weeks of the year. These bonuses are therefore not included in full or part in the calculation of their statutory maternity pay.
That clearly gives rise to gross inequalities between women in respect of the treatment of annual bonuses in the SMP calculation, which in turn could, and does, create situations where women on identical remuneration packages receive significantly different benefits while on maternity leave. That is especially unfair as the employee has no control over when their annual bonus is paid, so it is a lottery whether their bonus is included in their statutory maternity pay, although, as I said in Committee, I do not think that that was what statutory maternity pay was ever supposed to be about in the first place.
As the Government refund employers 92 per cent of statutory maternity pay, this issue should be on the Government's agenda. The current system is clearly unfair and warrants reform. The amendment would reduce the cost of statutory maternity pay to the Government, avoid giving an arbitrary and potentially significant advantage to a proportion of employees and establish a precedent that could be followed in relation to any provision for earnings-related statutory paternity pay.
In Committee, the Minister accepted the aim of the amendment. The noble Lord, Lord Hunt, suggested that to unpick one element of the system was not sustainable and would serve only to complicate the administration and understanding of the existing rules. Feedback that I have received from industry suggests that that is not necessarily the case. I would therefore ask the Minister and his department to work with HR experts further to understand the issues better and to look again at the whole system.
I understand that the Department for Work and Pensions has made a commitment to consider the case for further simplification on the way in which employers administer statutory maternity pay once the measures in the Work and Families Bill have been introduced—once again, as my noble friend Lady Miller said, making decisions after the Bill has passed through Parliament. Surely that should have been looked at in preparation for the Bill rather than after it. Will the Minister confirm that the consultation will cover bonuses?
Also in Committee, the Minister kindly offered to meet those who briefed us on this issue. I hope that in his reply he can inform your Lordships on how he feels the meeting fared. I understand that during the meeting the view was expressed by the Government that the 1992 directive on pregnant workers, which contains a no detriment clause, prevents the Government reducing the level of protection offered to workers from the level offered when the directive was passed. Therefore, I understand that the Government believe that the no detriment clause prohibits pro-rating of bonuses and statutory maternity pay as that would result in a reduction of benefits to women who are eligible to receive a level of statutory maternity pay that reflects their full bonus. I am sorry but this is a bit complicated.
I have received conflicting legal advice on this directive, which is not consistent with the interpretation of the legislation by the Department for Work and Pensions. Article 1(3) states that the directive itself,
"may not have the effect of reducing the level of protection", afforded to workers when the legislation was adopted in 1992. That terminology is crucial as it is not phrased as other parts of the directive are, in terms that expressly direct member states to act or prohibit them from acting in a specific way. As such, it is suggested that this provision does not amount to a prohibition on member states reducing or amending the level of protection offered to workers. This conflicts with the DWP's contention that to reform the SMP rules, as this amendment suggests, would put the UK in breach of this directive.
We need a system for maternity pay that is fair, robust and fit for today's labour market, which has changed enormously since statutory maternity pay regulations were first introduced—as I am sure all noble Lords would agree. The example of bonus payments suggests that the current system may not be living up to those expectations. I hope for a commitment from the Minister in his reply that the Government will continue to look at this issue. I beg to move.
My Lords, I do not intend to say much, because I am absolutely dying to hear what the Minister has to say in response to this amendment. The noble Baroness, Lady Morris of Bolton, must have had to wrap a wet towel around her head in order to write her speech in moving the amendment. The Minister will probably have had to do the same in preparing his reply.
My approach to this is that there is clearly an anomaly here if two women on exactly the same remuneration package can receive totally different amounts of maternity benefit. In the real world, people regard their normal bonus as part of their annual salary. They rely on it when they decide on the outgoings of their household—for example, paying their mortgage, buying their car and all these big outgoings. Bonuses really need to be taken into account for all mothers under the same contractual arrangements.
If there is—what was the phrase?—a "no detriment clause", which means that we are not allowed to put this anomaly right, that is mad. There is clearly going to be a detriment to the woman whose bonus falls outside the period of maternity pay. I will say no more as I really cannot wait to hear the noble Lord's explanation.
My Lords, I hope I do not disappoint the House. The noble Baroness, Lady Morris, argued her case eloquently, and then anticipated what I was going to say. There is a bit of rough and ready about the current system; I do not deny that. One of the complaints that the noble Baroness did not make but that has been made is that it is open to abuse. We do not think that there is evidence of a considerable degree of abuse. We have concerns that making changes in the ways the noble Baroness suggested would actually bring much greater complexity to employers. It is also worth making the point that her amendment deals with a case in terms of taking unusually high earnings and managing them down. It does not deal with the opposite case of a period in which a woman might receive unusually low earnings, and manage it up. I will come on to the Pregnant Workers Directive in a moment because that presents a challenge in this area; I will not say more than that.
There is no question that this has been debated over the years, and there has been a constant search for a system that balances the needs of fairness and simplicity for both employers and employees. The Government have talked to interested parties, and I assure the noble Baroness that we continue to do so. She is right that, following our debate at Committee, my officials met representatives of the Prudential to discuss this matter further. We will continue to do that. I understand the point she makes; that we are shortly coming to an end with the current legislation. We will continue, post that date, to talk to relevant parties. If we can find a solution in the future, of course we would have to consider further action.
I stress that a balance has to be made between getting it absolutely right in all ways and having a straightforward system for employers to administer. From the Department for Work and Pensions' point of view, this trade-off is consistently made. Noble Lords are always asking me about the simplification of the benefits regime. We are keen to do that but, again, there is a trade-off. We have a complex benefits system because, as legislation has gone through both Houses, amendments have been made and Members of both Houses have wanted to ensure that our benefits system is as sensitive as possible. This is the same type of trade-off that we have for statutory maternity pay.
There is a question of whether employees of their own volition, and employees and employers in collusion, are seeking to abuse the current system. Obviously, it is difficult to come to absolutely hard and fast conclusions in researching this. Colleagues at Her Majesty's Revenue and Customs, who are responsible for monitoring compliance in this area, are aware that cases arise from time to time. There is no evidence that it is a significant problem, however. It is also worth noting that only 1 per cent of women getting SMP receive more than £1,000 a week for the first six weeks. Compared to very high bonuses, this is a small issue.
The House is inviting me to give a peroration on the Pregnant Workers Directive. I am not sure that I should go down that path. I can say that, following the meeting with Prudential, we received a letter from it relating, I suspect, to the legal points raised by the noble Baroness. We will look into that, and I will ensure that the noble Baroness receives a copy of any response to her points.
I would not want to hide behind the Pregnant Workers Directive. Although it is a challenge and a factor in any consideration, the Government's case rests on the fact that this is a tried and tested system. It is a bit rough and ready, but we are not persuaded that it operates so unsatisfactorily that we should move away from a pretty straightforward system for employers to administer, to one that would be far more complex. I assure the noble Baroness, however, that we will continue to talk about these issues.
My Lords, I thank the Minister for his full reply, and the noble Baroness, Lady Walmsley, for her support. She talked about a wet towel. The Japanese have a saying about a "1,000 aspirin job"; this was definitely a 1,000 aspirin amendment. I have a wonderful mental picture of the Minister hiding behind the Pregnant Workers Directive; that was very funny.
This is a complex situation, and I understand that there needs to be a simple method of calculating statutory maternity pay for employers. I do not doubt that for a moment; I am the last person to want to increase the burdens on industry. However, there is an injustice here, and not just between two women on the same remuneration package. The Minister talked about pregnant women on low earnings whose bonus boosts their earnings, but there are also lots of women who do not have any bonus at all.
The Minister said that only 1 per cent receive more than £1,000 per week, but he and I both know that some of those women receive considerably more. That was not the idea of statutory maternity pay. That money could be put to much better use. However, I understand that, because this is a complex issue and the Minister will need to look at legal advice—particularly on the Pregnant Workers Directive—this cannot be resolved now. Therefore, in good faith and knowing that the Government will continue to look at this issue, I beg leave to withdraw the amendment.
My Lords, in moving Amendment No. 9, I shall speak also to Amendment No. 10. Together the two amendments extend the right to request flexible working to all parents of children under the age of 18. In contrast to that, the Government have stated that they intend to prescribe the current age limits for that right, which is parents of children under the age of six or a disabled child under the age of 18. The UN Convention on the Rights of the Child prescribes 18 as the age under which parents have parental responsibility for their children.
I believe that it is up to parents to decide how much time they need or want to spend with their child and how they need to organise their working arrangements to enable them to do that. Some children will need more time with their parents than others. Children who go through life and school without major problems may not need quite so much time with their parents as those who are perhaps a little more troubled, have more difficulties or are having problems at school. Parents of such children may want to rearrange their working arrangements to enable them to spend more time with their children.
I believe that there is a very strong case for extending the right to request flexible working further than that which the current Bill proposes. Of course, I welcome the Bill's extension of that right to request flexible working to carers of disabled adults, but I believe that the Government's intention to continue restricting the right to request to parents of very young children fails to address the difficulties that many families face in balancing their work and caring commitments.
In Committee, the Minister argued that the right to request flexible working needs to be extended slowly to allow employers time to adjust to new groups of workers making such requests. However, I believe that this piecemeal approach makes the right to request unnecessarily complex. Of course, we have to remember that, anyway, many employers will have to introduce new policies following the passage of this Bill to take account of the new rights of the group of carers of disabled adults who happen to be their employees. A wider right to request for the parents of all children would allow employers to assess the needs of their entire workforce all in one go once the Bill has Royal Assent. If we do not change the Bill to extend the right to parents of all children, I think it will happen later, but I would rather it happened now.
Many good employers already offer flexible working to more groups than the law currently requires and often to the whole workforce. The economic case for doing so is very strong. I shall turn to that in just a minute. First, we need to consider why parents want the right to request flexible working. I believe it is because the need for flexibility in working arrangements does not stop when a child reaches school age. Finding childcare that fits around the school day can be more complex than arranging full-time childcare for pre-school children. The fact that wrap-around childcare is available does not mean to say that all parents want it. Some parents prefer to look after their children themselves. The Government need to do everything they can to enable parents to make that choice for themselves on the criteria that exist within their own families, about which they know a great deal more than any of us in your Lordships' House.
Flexible working incorporates a wide range of working patterns, including flexi-time, working from home, part-time working, job-sharing and so on. Many parents want only very small changes in their working arrangements. They do not necessarily want a complete upheaval in their working week. They may simply want to start half an hour later to enable them to take their children to school or finish half an hour earlier to enable them to collect their children or they may want to work only on weekdays so they can have time off to be with the family at weekends.
The Minister argued in Grand Committee that any employee now has the right to ask to work flexibly, regardless of whether they have a statutory right to do so. But without a statutory right to request, parents in low paid or low status jobs have limited ability to negotiate with their employers. They are the underdogs in those negotiations. They may ask for changes, but their employer has no duty to consider their request unless they have that statutory right.
I shall give one example, which is different from the ones that I gave in Committee. A single parent of a 10 year-old child called the Working Families helpline. She worked in a hostel for homeless people, and her shift work included working nights about once a week. She had childcare arrangements to take care of that, but those arrangements broke down and she asked her employer to change her to day shifts. The employer refused to do so because much of the work took place at night and he preferred to recruit somebody to do the lighter workload during the day than somebody to do the heavier workload at night. Her child was too old to enable her to use the statutory right to request, so she did not have the support of the law in the good case that she was trying to make.
There are many benefits for employers and many employers know it. They know that allowing their employees to work flexibly brings them business benefits. The DTI's report Success at Work notes that:
"Employers who have introduced family friendly working policies report improved morale, commitment and retention of staff, leading to financial savings, improved customer service and the ability to react more effectively to changes in demand".
The CBI agrees. It stated that 87 per cent of businesses surveyed by it reported that the existing law had either a positive or no impact on their business. Additionally, evidence from the Government's former Work-Life Balance Challenge Fund reveals that workplaces with flexible working policies have reported financial savings, reductions in staff turnover, reductions in absenteeism and improved productivity—as much as a 50 per cent improvement in that area.
In Committee, the Minister argued that he is concerned about the impact of extending the right to request to small businesses whose resources to meet an increase in demand for flexible working are limited. This led the Government to be cautious about widening the scope of the law. But the Employment Act 2002 already sets out many reasons that small employers can give to turn down a request to work flexibly. They can do that quite legitimately. There are nine reasons: eight specific ones and one catch-all;
"such other grounds as the Secretary of State may specify by regulations".
If this amendment is accepted and the Secretary of State finds that a lot of small businesses were being disadvantaged by it, the Employment Act 2002 already gives the Secretary of State power to introduce more legitimate reasons why small businesses could turn down such a request. The power is there. Small businesses unable to meet a request for any of those reasons can legitimately turn down a request. Given that safeguard for small businesses and all the evidence that we have from the CBI, the DTI and other organisations of the many economic benefits of having a flexible working system within the workforce, I wonder whether the Minister has thought again about the arguments he made in Committee. I do not think that they hold water. There are sufficient benefits and safeguards. It is the intention of the Government to give parents the opportunity to look after their children, avoiding the need for parenting orders or ASBOs—which are used for young people far too much—and to exercise the responsibilities they have as parents, balancing their caring and employment responsibilities. The Government would be in line with their own policies if they accept these amendments. I beg to move.
My Lords, while we have great sympathy with the concept underlying the amendments, we cannot support them. I feel churlish in saying that because the noble Baroness, Lady Walmsley, has been supportive of everything we have done so far in the Bill.
I thank the Minister for his letter following our debate in Committee when we discussed the much-needed support of older children with mental health problems. I am pleased to see that parents of children aged between six and 18 years with mental health problems are covered by the right to request flexible working if the child falls within the definition of disabled. However, I remain concerned about those who will not fall within the definition.
We have enormous sympathy with those who seek to extend the right to request flexible working, but our sympathy is shared with those employers who have to shoulder the burden of the regulations. Although the noble Baroness, Lady Walmsley, said that the Secretary of State would be able to amend that under the Employment Act 2002, I am not sure that that power would be used.
As I said at Second Reading and in Committee, we genuinely believe that flexible working is an area where big business is often ahead of legislation and where small business is the original flexible employer. One of our main concerns with the amendment is that if the right to request flexible working is extended to parents of children up to 18 years, alongside the proposed extension to carers and the existing right for employees with a child up to the age of six, you run the risk of leaving a small number of employees with no such rights and a grievance that any extra work will fall on them.
"There is no point in being family-friendly if we are not job-friendly".—[Hansard, Commons, 5/12/05; col. 656.]
My Lords, I support the amendment. The Government have done a tremendous amount to improve the rights of women, and men too, and to broaden the opportunities for both sexes to continue in their jobs and undertake their responsible role as a parent.
My main reason for wanting to extend to the age of 18 is that now is an ideal opportunity. As the noble Baroness, Lady Walmsley, pointed out, small businesses and other organisations will be able to advance a number of reasons why flexible working should not be granted. However, what I wish to take place more quickly is for fathers and mothers to be equally entitled within their employers' set-up to take parental leave for those up to the age of 18. That makes perfect sense to me. As we have heard, stress can occur within a family. To reduce the stress and help the young person to move through it, one needs that flexibility.
Another reason is that I have looked back at the pamphlet produced in 1996 by Demos on parental leave. That is a long time ago. It would be a shame if we had to wait another 10 years. I quote these words because they sum up the noble Baroness's point about persons being responsible adult citizens because they have had the full support of family and the community. The pamphlet expects to see major pressure on policymakers in this whole area. It states:
"In part this will be a shift from seeing parenthood primarily as a private choice, and children as a private good, towards seeing the quality and quantity of parenting as a public concern and well-brought up children as a public good".
It goes on in that way. That is exactly what the Government have been doing at a much faster rate, I have to say, than any previous government have done that I have been alive for. I would like to see them take this profoundly important step at this stage, which will encourage the real leap forward that we need for both fathers and mothers, and encourage the employers to set this as the normal expectation for people working within their organisations.
As we have heard already, a tremendous number of companies have done this already. We know too that Working Families, which is an amazing group of organisations, supports what is suggested here. I hope that the Government can think again.
My Lords, I am grateful for what has been said by the noble Baronesses, Lady Walmsley and Lady Howe, and I support both of them. I am still really taking aboard the reluctance of the noble Baroness, Lady Morris, to do so. I support the provision from these Benches.
I regret that I was not here for earlier stages, but I am here as a successor to my colleague the right reverend Prelate the Bishop of Southwell and Nottingham, who took part in earlier stages of the Bill.
The noble Baroness, Lady Howe, has expressed gratitude to the range of organisations which have offered briefing. In that light I should express an interest as a member of the Mothers' Union, which is among those organisations. It is—as are the Churches, other Members of this House, and indeed the Bill—committed to working very closely on the welfare of children and families, so sustaining marriage and other marriage-like relationships, on the question of work/life balance as regards the welfare of children and young people, and on the welfare of adults involved in their care and of adults themselves.
Allowing flexible working in circumstances of real need for parents and carers up to the age of 18 is just as important as the noble Baronesses, Lady Howe and Lady Walmsley, have said it is. Any of us with experience of the pressures on our married children who are both working and engaged in childcare and child responsibility know that it is just as difficult as the noble Baroness, Lady Walmsley, described to make the right arrangements. That difficulty does not stop there. I do not have family experience of this; I have a lot of other experience of it. That difficulty does not stop at the age of five or six.
I will not go into the debate that the noble Baroness, Lady Walmsley, and my colleague the right reverend Prelate the Bishop of Southwell and Nottingham went into in Grand Committee of just what all that means. But the difficulties are very real. Granted the Government have admirable intentions, on which the noble Baroness, Lady Howe, has rightly congratulated them, but the logic is that this amendment should be accepted and carried.
I have read the material in Grand Committee about pressures on small businesses, and I understand that, but there are ways of assisting them. The Government put out an astounding amount of information assisting on a lot of things. I do not see why they should not do so on this set of matters and assist small businesses employing only a few people to understand the issues, and to understand that overcoming these difficulties in the end, as so many businesses have experienced, is good for businesses and good for relationships.
The last thing I want to say is that, as again the noble Baroness, Lady Walmsley, noted, there is a particular need to be alert to the needs of those representatives of families who may be less well paid, less able to negotiate, less well educated and perhaps most at threat in today's society, which puts high pressure on marriages and other relationships. I shall not go on longer but, for all those reasons, I think this is an important amendment, as are Amendments Nos. 11 and 12 for the same reasons, and I support it.
My Lords, I, too, support the noble Baroness's amendment. We are, after all, moving into a business society in which we have a global economy and where businesses are expected to run for 24 hours a day, seven days a week, and for 364 days a year in some cases. There are enormous pressures on families in this context. But we have fought these issues in this House looking in the other direction, and this is an opportunity to look in the direction of children and families and to do something positive for them. Only 27.5 per cent of a child's waking hours are spent in school, if you include holidays and weekends. That leaves some 70 per cent of that child's time which is at least nominally the responsibility of parents. How in the world can they enable their child to manage that time if both of them are working to some sort of pattern that makes them unavailable at the time?
Yesterday evening, there was a very good programme on BBC2 about children in a Welsh valley who came out of school, got on the train and mucked about as teenagers will, went home, got all dressed up, got on the train, came back and then painted the town red. Of course, they had nothing else to do. Presumably in many cases their parents were not at home. I support the amendment.
My Lords, this has been a very good debate. We are at one in recognising the pressures on many families, particularly where both parents are at work, and the already great success of flexible working. I cannot accept the amendment, because I believe that flexible working has been so successful up to now as a result of the consensus that has been reached with stakeholders, employees and employers. That general support has meant a great deal of encouragement and success in the way in which flexible working has actually operated. It is very important to keep that consensus. The noble Baroness, Lady Walmsley, calls it a piecemeal approach. I prefer to call it a step-by-step approach that has been very successful and will, I think, be very successful in the future. The main ingredient of its success has been employers' ability to support it.
The noble Baroness, Lady Walmsley, quite rightly quoted several employers, but I could also regale the House with quotations from employers who support what is being done and what we are going to do. Equally, she is right that many employers have extended to employees flexible working that is over the current statutory limits. That is very much to be welcomed, but this policy is much more firmly based on a proposal that receives support from all those concerned and for those who have to operate such a policy.
The evidence that it is working is quite clear. The introduction of the right to request flexible working commenced in April 2003. A survey by the Policy Studies Institute, which was published on
The second reason for success is what one might call the halo effect, although I am not sure that this House would ever say that legislation has a halo effect. However, legislation can sometimes be used to cause a change in behaviour. I believe that, in this instance, there is again very persuasive evidence that that has occurred. The original legislation has had the effect of making businesses focus their minds on the business case for flexible working, which is why we are seeing such an encouraging response from businesses when they have been asked to comment to noble Lords on this legislation. Very innovative approaches to the provision of flexible working arrangements are coming forward.
It is not very fashionable to commend McDonald's these days. However, only a few days ago, I received a letter from it enclosing its family contract. It enables two people from the same family who work in the same McDonald's restaurant to cover each other's shifts with no prior notice. I understand that that is very helpful to employees—and there are other great examples of that. The evidence seems persuasive that this light-touch, step-by-step approach to legislation is having a very powerful impact, but it is also encouraging employers to do more. That is just the kind of legislation which this House in particular has wanted to encourage and advocate in the years that I have taken legislation through it.
In this Bill, we are extending the right to carers of adult persons, which has received warm support. The consultation document Work and families: choice and flexibility asked what more the Government could do to help families find working hours to match their caring responsibilities. There was strong support, including from employers, for the idea that carers should receive the priority in any extension of the law. We have listened to that and have followed suit. Extending those rights to carers increases entitlement to 1.5 million employees. Already we reckon that 3.6 million parents are covered under current legislation. Accepting the amendment would mean that another 4.6 million people would be entitled.
Of course, I understand the arguments. The noble Baroness would say that such a large number is the reason to support the amendment. But, from the point of view of employers, one has to consider that very large number. She is right to suggest that there are safeguards. None the less, this has been outstandingly successful legislation, which has encouraged a wholesale change in culture among employers. The step-by-step approach is the right one to take. Having the support of employers in this approach means that it is much more likely that it will come to a successful fruition.
My Lords, I thank the Minister for his response. I thank all noble Lords who have supported my amendment, including the right reverend Prelate. I am of course disappointed that the noble Baroness, Lady Morris of Bolton, was unable to do so. As I understand it, her reason was concern for other workers who might have a greater burden because of the flexible working arrangements that might be given to a parent. However, the other workers probably are or have been the parents of young children and would understand the pressures on the parent asking for flexible working arrangements at that time. If it is not too hard for companies which are already implementing flexible working policies to bring other workers along with them in the consensus that the Minister mentioned, it probably is not too hard for new companies to do the same.
The Minister objected to my amendment on the basis that the current success is due to a consensus that has been developed. I do not see why that sort of consensus could not apply just the same if the right to ask for flexible working was made statutory for parents of all children up to 18. We must remember that this is not a right to have flexible working; it is just a right to ask for it. I reiterate the safeguards that I mentioned. I did not list them deliberately because I did not want to weary the House, but they are considerable for employers to give as legitimate reasons for not granting flexible working.
The figures that the Minister quoted for those who are taking part in flexible working are welcome, but we need to go further. I wonder whether the Minister is worried that employees who ask for flexible working and are turned down on some of those grounds would feel resentment, and that that would interfere with their relationship in the workplace. Similar resentment may be felt by workers who would like to ask for flexible working but do not feel that they have sufficiently strong rights to be able to get anywhere.
The Minister also talked about the halo effect. I hope that he is right that such best practice will trickle out among the industry and the workforce. I worry about the power of inertia, because businesses have a great many things to worry about without worrying about something like that. It takes a visionary employer to implement some of those best practices in relation to family-friendly working policies.
The Minister mentioned that this was a step-by-step policy. I welcomed hearing him say that, because before I withdraw the amendment I would like to ask him whether he is considering another step after this one; for example, will he consider the step that would give the statutory right to ask for flexible working to parents of children up to say, the age of 11, when they go from primary to secondary school? That is a natural change of life for the child and the family and it would be the logical next step if we are thinking about a step-by-step arrangement.
My Lords, I cannot give a commitment to the noble Baroness, but we will monitor the introduction of the new provisions and continue discussions with stakeholders. We will also pick up the issue raised by the noble Baroness, Lady Morris, about children with mental health issues to see how that is working. This matter is not set in stone. Equally, I will not say that we have a target in a few years' time that the provisions will be extended, but it is an act of faith that we will keep the matter under review and continue to discuss it with stakeholders.
We all want to make flexible working successful. We want to see it embraced by as many parents as possible, but we want to do it in a way that does not place huge burdens on British business at a time when we face many challenges. We want to do it with the support of employers. I am convinced that this is the way to do it.
My Lords, I am slightly reassured by what the Minister has said and I thank him. If we are to believe the many reports that tell us about the enormous economic benefits for businesses of adopting those practices, we should not withhold them. I hope that businessmen reading our debates today who perhaps have not thought about such policies will be stimulated to do so and to consider many of the good examples cited in your Lordships' House. In the meantime, I beg leave to withdraw the amendment.
moved Amendment No. 11:
After Clause 12, insert the following new clause—
(1) Section 80A of ERA 1996 (entitlement to paternity leave: birth) is amended as follows.
(2) In subsection (3), for "at least two weeks' leave" substitute "at least four weeks' leave".
(3) In subsection (4), for "a period of at least 56 days" substitute "a period of at least 182 days, and of no more than 365 days"."
My Lords, in moving this amendment, I will speak also to Amendment No. 12, which is grouped with it. The purpose of Amendment No. 11 is twofold—to increase the entitlement to ordinary paternity leave that is set in regulations from the current level of two weeks to at least four weeks with the potential to increase it further and, secondly, to extend the period during which such leave has to be taken from the current period of eight weeks after the birth to a minimum of six months and a maximum of 12 months after the birth—the period again to be set in regulations. Ordinary paternity leave needs to be of longer duration than at present and it certainly needs to be more flexible in terms of how it can be taken. The amendment deals with part of that flexibility and Amendment No. 12, to which I will come in a moment, deals with another aspect of that flexibility.
The amendments would meet with the spirit of the Government's declared intention to provide more support and choice in the first year of a child's life. I was encouraged to get a little support for that belief by the words of the noble Baroness, Lady Crawley, on 22 of March when she responded to a Starred Question by saying:
"Yes, my Lords, families are the first to know when they need support. The Government are there to help and to support and not to interfere unduly".—[Hansard, 22/3/06; col. 233.]
to which I say, "Hear, hear". A similar amendment could—and should—be made in relation to Section 80B of the ERA 1996 which deals with entitlement to paternity leave: adoption.
Making paternity leave a little longer and allowing parents to choose over a longer period when it should be taken would better meet the needs of working fathers and their families than the Bill's provision in respect of ordinary paternity leave. Relying on the new additional paternity leave to give fathers more opportunity to support the mother and bond with their children is not valid. The Minister relied on evidence in Grand Committee that most fathers take time off after the birth and are satisfied with the amount of leave that they have. What he did not give us was a breakdown and analysis of what sort of leave they take. Many of them take some of their statutory holiday or a few days of compassionate leave that a generous employer might give them or a mixture of both plus some of the ordinary paternity leave.
There was some dispute among us about the actual figures for uptake of paternity leave. My figures are based on the number of fathers who take the full entitlement to paternity leave because the fact that you have to take the two weeks together—if you take only one week you lose the second week—means that many fathers are not taking that full entitlement. That is a lack of flexibility that I regret.
The Minister also relied on the entitlement to 13 weeks' unpaid leave to which the father has the right up to when the child is five. Since that is unpaid, it is not a realistic option for most families. If the Government really want fathers to have the opportunity to support the mother at a time when a child is very young, to bond with the child and to develop the feelings of fatherhood which will add to his commitment to support the child right through his or her childhood, we must focus on ordinary paternity leave rather than the additional paternity leave which many fewer fathers will be taking—welcome though it is.
In Grand Committee on
"in recognition of the fact that both are likely to be most in need of that care and support during the first few weeks. To allow the leave to be taken up to a year later would be to fundamentally change the purpose of the entitlement. We are introducing additional paternity leave for those fathers who wish to take leave later on in the first year of the child's life".—[Official Report, 9/3/06; col. GC 383.]
In insisting on that, the Government are making the decision for the family. It could very well be that it is not in the first few weeks after the birth that the mother really needs the support. She may well have the support of her own mother at that time, or the father's mother. It may be later on, perhaps when she has some reaction to the birth of the child, as some mothers do, or when she decide to change the method of feeding the child—from the breast to the bottle. There are many examples of why it may be much more appropriate for some families to choose to take the leave a little bit later.
The Minister mentioned that he was concerned about the effect on businesses of extending the period over which the father can take ordinary paternity leave. I fail to see why this disadvantages them to extend that period. We are talking about only a very short period. Unless the part of my amendment that doubles the entitlement is agreed to—and I am somewhat doubtful as to whether the Government would accept that—we are just talking about two weeks. It is the same as the period of a normal family holiday. It would be of little disadvantage to a business to allow the father to take that leave at another time, a little bit later on in the child's life.
I turn to Amendment No. 12. The purpose of this amendment is to increase the flexibility for the arrangements for the ordinary parental leave entitlement by reducing the period of notice required for the employee to give to the employer up to a maximum of,
"two weeks for each week of leave to be taken".
Today, fathers are entitled to take up to two weeks of ordinary paternity leave but they must give their employer notice of their intention to take leave by the 15th week before the baby is expected. We are talking about 15 weeks' notice for a two-week absence.
The current period of 15 weeks is out of proportion to the amount of time off allowed. According to Regulation 15(1) of the Working Time Regulations 1998, an employee wishing to take annual leave should give twice as many days' notice as the amount of leave he or she wishes to take. So, for a two-week holiday period this would equate to four weeks' notice. The introduction of ordinary paternity leave has been important and I commend the Government for encouraging fathers to take time off to spend with their young child. However, many fathers have found that the 15-week notice period has frustrated their intention to take such leave because they have not really been aware that they had to give it. Some employers who are reluctant to grant ordinary paternity leave have stood by their rights and said, "You have only given me five or six weeks' notice and I am entitled to 15, so you are not going to have it".
In the draft regulations on additional paternity leave and pay which appears later on in this Bill, it is proposed that an eight-week notice period is sufficient for a father notifying his employer of his intention to take a much longer period of leave—up to 26 weeks. Therefore, 15 weeks' notice for a two-week period is both excessive and illogical and completely out of proportion. Most importantly, reducing the notice period for ordinary paternity leave to a maximum of four weeks for the current entitlement of a two-week leave would further improve the take-up by fathers, to the benefit of the whole family. Although there was some dispute between us as to how many fathers take up paternity leave, we cannot be satisfied until 100 per cent of those who want it actually manage to get it.
The Government have talked of the need for consistency. It is just as easy to be consistent about the period of notice required for holidays or, slightly longer, the notice period required for additional paternity leave, rather than be consistent with the regulations for the notice period that the mother has to give her employer. After all, they are probably two different employers, so the benefits of consistency between notice periods for paternity and maternity leave are unlikely to be felt. Moreover, here we are talking about a much shorter length of time. The mother can take six months' leave; that is soon to rise to nine months and eventually, it is hoped, to 12 months. It is right that an employer is given plenty of opportunity to plan for cover. He may need to recruit someone. But the father has only a short period of leave—no more than would normally be taken for a family holiday. It is therefore perfectly consistent that the same rules should apply to the amount of notice given. I beg to move.
My Lords, organisations including Working Families and the Equal Opportunities Commission have raised important concerns about certain issues surrounding paternity leave, which the noble Baroness, Lady Walmsley, has emphasised by tabling these amendments. We are the first to recognise the important role a father plays within the home in the nurture of his children. One of our concerns about the right to existing paternity leave is its rigidity, a point forcefully made in Grand Committee and again today by the noble Baroness.
Employers may be concerned that if paternity leave may be taken in a series of single days, it might mean that some fathers would work 10 four-day weeks. Some businesses could ill afford that, but others might prefer their employees to take their entitlement in individual days rather than in whole weeks. Further, if an employee takes only one week, then to lose his entitlement to the other week is harsh. It could also be that some employers and employees want a mixture of whole weeks and single days.
Legislation should not be so prescriptive that it does not provide flexibility when it is desired and agreed between employers and employees, and employees would be happier with their current entitlement if there was more flexibility. Perhaps this is a way forward, and I hope very much that the Minister will agree to consider the proposal before Third Reading.
My Lords, I rise briefly to add my support to these amendments. I know that both Fathers Direct and the Equal Opportunities Commission are concerned that many fathers simply will not be able to afford to take up the additional paternity leave entitlement if it is paid at only £109 a week. We have to decide whether we really mean it when we say that fathers are important. If we do think so, the Government ought seriously to consider stumping up the money for an extra two weeks.
The other consideration is flexibility. I strongly agree with the noble Baroness, Lady Walmsley, that it is absurd for legislation to prevent an employer and employee agreeing on their arrangements for paternity leave. I do not think that I need say any more.
My Lords, I warmly support the amendments. This may seem a small step—I would prefer to see more sharing of the time between the two parents—but flexibility is clearly the key here and this Bill is all about flexibility at work. The legislation seeks to increase opportunities for people to work in flexible ways, to the benefit of families. I hope that this small but necessary step can be agreed. The fact that it has the support of the Equal Opportunities Commission and a number of other organisations reinforces the need to do something, particularly for low-paid workers.
My Lords, I begin by thanking the noble Baroness, Lady Walmsley, for tabling each of these amendments. We have a bit of a rerun of the discussion that we had in Committee. I start, therefore, by saying that it is not our current intention to propose any changes to the existing two-week entitlement. Although we always reflect on debates—the noble Baroness, Lady Morris of Bolton, pressed this—we believe that the law as it stands is working well and serves the interests of employer and employee.
These amendments, taken together, seek to make substantial changes to the fabric of the existing right to paternity leave. The first seeks to extend the period of existing paternity leave available to the father immediately after the birth from two weeks to four— there is, obviously, a cost associated with that—and to increase the period during which it may be taken from eight weeks to between six months and a year. The second would significantly reduce the amount of notice an employer would receive of a new father's plans to take paternity leave. Similar amendments were discussed in Grand Committee.
First, I take the issue of two weeks of paternity leave. Such leave is, of course, still a relatively new right. We have been extremely pleased by the fact that many thousands of employees have made use of it. The recently published Maternity and Paternity Rights Survey of 2005 provides much encouraging data on the uptake of the entitlement. For example, according to that survey, around 93 per cent of fathers surveyed said they had taken some leave around the time of the birth—and, of those, four-fifths said they had taken at least some of that time at full pay—while around 80 per cent of fathers surveyed had used at least some of their statutory leave entitlement.
The existing entitlement was structured following careful consultation with stakeholders, including business. The outcome of that was the creation of a two-week entitlement, which the Government judged struck an appropriate balance between allowing a father, on the one hand, to spend time with his new baby and the baby's mother and, on the other, the needs of his employer. We have seen no persuasive evidence since then to suggest that we should change that.
Two weeks off work soon after the birth gives a father the opportunity to give mother and child the support and care they need at that critical time, and to begin to play his important role in the child's upbringing from the earliest opportunity. Research tells us that fathers often take more time off work than their statutory two weeks, making use of other entitlements—as the noble Baroness, Lady Walmsley, acknowledged—such as annual leave. The 13 weeks' unpaid parental leave also provides them with some flexibility to take extra weeks once the child is over eight weeks old. That can be taken until the child is five years old.
Amendment No. 11 would not provide for flexibility in how the leave is taken in separate days but the employee has flexibility to choose when, within the relevant period, he will take his leave and whether to take one week or two. Noble Lords will agree on the importance of getting the right balance between the interests and needs of employers and employees. The maximum statutory entitlement reflects that sensible balance and the needs and views of those who contributed to the consultation prior to the introduction of the new law.
I turn to the question of the time during which paternity leave may be taken. To argue that the two weeks' ordinary paternity leave should be taken at a time of the father's choosing, up to a year following the birth, is to ignore the purpose of ordinary paternity leave. That point was touched upon in Committee; I will not reiterate it but, as the noble Baroness acknowledged, we are introducing additional paternity leave for those fathers who wish to take leave later on in the first year of the child's life.
Allowing up to eight weeks in which to take the two weeks' leave in our view allows a sensible degree of flexibility for the employee to choose when best to take it. The majority of employers recognise their responsibilities at that time and play their full part in supporting the father during this process. But to require them to allow fathers to take their paternity leave over what, under this amendment, could be anywhere from birth to between six months and a year after the date of birth of the child would be to place far too great a burden on the employer. The eight weeks currently allowed for in the legislation are a proportionate and fair entitlement. Extending the time over which paternity leave can be taken would reduce certainty for employers at a time when we are bringing in other measures to increase certainty for employers, such as extending the period of notice women must give if changing their return from maternity leave.
The second amendment touches on the notice that must be given. As was noted, currently an employee must give notice of his plans for paternity leave by the 15th week before the week in which the baby is due. This amendment would reduce that to two weeks' notice for each week of paternity leave. So an employer would receive only two weeks' notice if the father were planning to take one week's paternity leave.
I stress that we consulted widely on our plans for paternity leave ahead of its introduction. The point at which a father must give notice of his paternity leave reflects the point at which a mother must give notice of her maternity leave. We recognise that there is a difference in the length of time off which the mother and the father will be taking. However, what is common to both is that the leave must be planned for and managed by their respective employers. In developing the paternity leave system, and indeed the adoption leave system, we heard it would be simplest to ensure the new schemes were as close as possible to the maternity leave scheme. Keeping the notice periods in step means that employers and parents need remember only one set of notice requirements and that employers are clear about when they can expect notice from an employee.
As with other types of leave, the notice period for paternity leave is a measure which protects employers, ensuring they have time to plan. Employers are, of course, free to accept a shorter period of notice if they wish and indeed must accept shorter notice if it was not reasonably practicable for the employee to give the notice set out in the regulations. There is some flexibility for the employee, who can change his plans provided he gives 28 days' notice. As regards the alignment of the 15th week for maternity and paternity leave, I accept that it may not be a case of the parents of the same child, but employers will have both mothers and fathers who wish to avail of these provisions and therefore will have systems to deal with both.
We are consulting on the notice which a father will have to give of his plans to take additional paternity leave. The consultation document suggests that he should give eight weeks' notice. This was suggested as it reflects the notice the mother will give of her intention to return to work. So the notice points for additional paternity leave would be aligned with the relevant maternity leave rules, just as the notice points for ordinary paternity leave are aligned with the notice point for maternity leave. Of course, it is likely that an employee who takes additional paternity leave will probably have already taken ordinary paternity leave, so the employee's notice of additional paternity leave will not be the first the employer will know of the employee's new baby. For example, there could have been discussions between the employer and employee about the possibility of the father taking additional paternity leave when the employee first gave notice of OPL. Indeed, such a dialogue would be desirable and to be encouraged.
The noble Baroness drew a comparison between the notice for paternity leave and the notice for annual leave. There are two points I would like to make about that. First, an employer can prescribe when an employee may take annual leave. So if the employee's plans are not convenient, the employer can refuse to allow leave at the requested time. There is quite rightly no scope for an employer to refuse to allow paternity leave at the time of the employee's choosing. Secondly, a request for annual leave will generally be specific about the timing of the leave. It is harder to be so specific about the timing of a baby's arrival, so where the father is planning to take his leave immediately following the birth, the employer is presented with what is really a guesstimate of the timing of the leave.
The noble Baroness also mentioned concerns that some fathers are losing out on paternity leave because they were not aware of the notice requirements. Evidence suggests that most fathers are aware of their right to paternity leave. The maternity and paternity rights and benefits survey found that 85 per cent of fathers were aware of their entitlement to paternity leave before their baby was born. The Equal Opportunities Commission survey Dads and their babies: leave arrangements in the first year, which was published in 2005 and part-funded by the DTI, also found that most fathers were aware of their rights before their child was born.
As part of the work and families package, the Government are reviewing the guidance available to parents and their employers. The new employee pages on the Directgov website contain straightforward information for employees about their employment rights. Those are linked with pages on having a baby, so expectant parents will find all the information they need about paternity leave and pay alongside other articles that they will be looking at when making plans about the arrival of their baby.
We would always hope that employers would be flexible and would support employees in managing their family responsibilities alongside their work. However, as I have set out, the notice period, the length of leave available and the period over which it can be taken reflect a balance between the interests of the employer and the employee. The amendments would shift that balance and place an unreasonable burden on employers. In conclusion, we will reflect on the comments made in the debate, review Hansard, and doubtless we will return to the issue at Third Reading.
My Lords, we may very well do so. I thank the Minister for his reply, and I thank all other contributors to the debate. Any employer who does not know that his employee is about to become a father is a bit of a disgrace—at least at some level in line management. Therefore, the notice period in a way is academic when it comes to the employer knowing that he or she must plan for some leave. If four weeks is enough notice for a change in the date, it certainly should be enough to allow the employer to plan for the original notice period. The Minister is very insistent on the issue of consistency, and he seems to think that the poor employer has such a small brain that he can keep only one notice period in his head at any one time. In that case, why did the Government not make the notice period for additional paternity leave 15 weeks as well? Why did they choose eight weeks?
My Lords, I thought that I touched on this. The eight weeks is aligned with the notice period that a mother is required to give of her return to work. There is symmetry in the arrangements from that point of view.
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
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.
My Lords, I am convinced by the appropriateness and adequateness of the rollout period proposed by the Government, and I am attracted by the simplicity of the arrangements. Therefore, I regret that I cannot support the amendment.
My Lords, I am conscious that quite a lot of our debate on the Bill has involved the noble Baroness pressing matters on the Government, and the response being that we are in the middle of a consultation or are about to undertake a consultation that we must see through. As anticipated, that will be the tenor of the response to these amendments.
Amendment No. 13 would require that the additional leave entitlement is phased in over a period. Such a phased introduction would give a longer period for business—particularly small businesses—to adjust to the new arrangements; it would spread any additional cost over a longer period, and the amendment reflects the position of the CBI.
I think that it is true to say that only the CBI has called for four phases of the introduction. Other stakeholders who will be affected—small businesses in particular—may have a different view as to the phasing. As the Government have already stated in their recent publication Success at Work: Protecting Vulnerable Workers, Supporting Good Employers, we will consider phasing in the additional leave entitlement. We hope to consult over the summer on this and the other issues on how to implement the annual leave provisions in the Bill. We should not pre-judge the outcome of that consultation, as this amendment seeks to do.
The amendment suggests a specific pattern of phasing in the additional leave—two additional days per year over a four-year period. That is just one possible pattern that should be considered, but it would place a significant burden on employers by changing the rules every year for four years. I will hang on to that point, despite what the noble Baroness said when moving her amendment. The outcome that the noble Baroness seeks to achieve—allowing time for business to adjust and to spread any cost of this measure—may be achievable in a less burdensome and more straightforward manner. Before we decide whether the additional leave should be phased in, and over what period, we should consult those affected—both staff and businesses—on what would be most appropriate.
Amendment No. 14 would place three requirements on any regulations made under the powers in Clause 13. First, it would appear that any regulations must specifically include bank holidays if the powers under Clause 13 are to be preserved beyond the end of 2007. However, there may be more appropriate ways of achieving our intent; for example, by making paid leave equivalent to bank holidays and additional to the annual holiday entitlement. The reference specifically to bank holidays could then be unfortunate.
The second requirement is that the inclusion of bank holidays should be phased in. As I said when discussing the previous amendment, we will consider phasing in any additional leave, but should not pre-judge the outcome of the forthcoming consultation that will include whether the introduction of any such leave should be phased and, if so, over what period.
The third requirement is that both Houses must approve any regulations made under Clause 13 by the end of next year. It is certainly our intention to make the best possible progress on the annual leave measure. However, the issues are complex, not least because of the variety and complexity of working patterns today. It may be that the full and extensive consultation that we are committed to throws up further issues that will require careful consideration and further consultation. I would not wish to tie our hands to a definitive timescale at this early stage in the process, and I am sure that the noble Baroness would not want us to commit to a timetable at this stage that will cause problems for both Houses later on.
For these reasons, we cannot accept the requirements that this amendment would place on the Government, and I ask the noble Baroness not to press either amendment.
My Lords, I certainly agree with what the Minister has said and am interested in his remark that there might be an alternative way of dealing with this, which I will find out more about in due course. Could he at some stage give me an idea of how the consultation is going? As he knows, we loathe having to pass Bills before knowing what the consultation outcomes and regulations are. They just come out, and there ought to be a definitive time by which this must end. I do not know why Bills cannot be timetabled to be dealt with after all that has finished. Having said that, I beg leave to withdraw my amendment.
moved Amendment No. 15:
Page 12, line 10, at end insert—
"( ) The higher sum so specified shall not be greater than 110 per cent of the current maximum amount of a week's pay immediately prior to the date of the order."
My Lords, Amendment No. 15 in Clause 14 introduces the concept of uprating of the ceiling on the amount of wages for the purpose of calculating redundancy pay. In a piece of self-denial, the Government claim that this will be a once-and-for-all provision. Yet the Government know perfectly well that not only can no government bind a later one, but also one administration cannot be prevented from amending their own legislation in the same Parliament if they believe that circumstances warrant it, or if they change their mind. I absolutely do not, and never would, impugn the good faith of the Minister on this; I accept his word unequivocally. However, the pledge that the Government give in this clause, that this is a once-only provision, is technically and from a legislative point of view meaningless. One may mean to do it that way, but it can be changed.
I bring this political point into my argument because of a telling phrase used by the Minister in Grand Committee when he rejected my amendment. He justified this increase on the grounds that—I quote him exactly—
"we should recognise that successive governments have let the relative value of the weekly limit fall . . . because it is linked to RPI rather than average earnings".—[Official Report, 9/3/06; col. GC 393.]
The Government's paper Success at Work claims that the statutory limit,
"is less in real terms than it was when Statutory Redundancy Pay was introduced in 1965".
As statutory redundancy pay has always been linked to the RPI, as the Minister admitted to the Committee, the explanation in the paper is not correct. The real explanation will be found in the Minister's refreshingly frank admission in Committee which, to some extent, gave the game away: the Government want to restore the link between redundancy pay and average earnings. To achieve this, they will have to make an increase more dramatic than the Minister had promised—or, despite the self-denying provision in this clause, sooner or later the unions will be back, like Oliver Twist, asking for more.
As an aside, perhaps the Minister will explain why it is right in principle for the Government to restore the link between average earnings in the case of redundancy pay, but refuse to do so in the case of state pensions. Clearly, the brothers have more political clout than their mothers.
This is not a matter where the Government are free of expense. In many cases, the employee is made redundant because the employer is insolvent. In such a case, the taxpayer has to pick up the pieces and make good the deficiency in the sum available to pay the employee. There are more civil servants now than ever before, so redundancy pay is simply not a problem for the government—except perhaps in the National Health Service, where staff now appear to be sacked wholesale.
However, once again, the form of this legislation is that of a blank cheque. We do not know when it will come into force. The Minister wrote to me to say that he was not at that time prepared to comment on the timing of the increase, and the Government refuse to commit to the amount of the increase—except that the Minister told me in Committee that he suspected:
"that an increase of 10 per cent may be rather closer to the mark than 100 per cent".—[Official Report, 9/3/06; col. GC 393.]
Once again, the Minister cites "consultations" as the reason for all this uncertainty and the Government's reluctance, even at this very late stage of the Bill, to commit to a figure. It does not take much imagination for me to work out the employers' organisations likely attitude. I suspect that some continuing haggling is going on between the Government and the unions. Of course, I do not know; I only suspect—as the Minister would probably expect. Perhaps the Minister will give us a clear picture of who is asking for how much in these consultations.
Taking the Minister at his word—which I have no hesitation in doing—that any increase is closer to the 10 per cent mark, that is the figure I have again inserted in the amendment. The Government have had since this Bill first went to Committee to come up with a binding figure. I put this amendment down early to give them time to consider their position. Even at this eleventh hour—just before seven o'clock—I am open to a serious offer. I have to say, however, clarity is essential on an important matter such as this. The Government cannot leave Parliament in this vague and uninformed state. I beg to move.
My Lords, I will be brief. Although the Government are clearly not in a position to restore the link between redundancy pay and average earnings, we regard this measure as a step in the right direction. Despite the fact that we deplore the Government's coyness in not telling us how much they have in mind, if the noble Baroness, Lady Miller of Hendon, wishes to test the opinion of the House this evening, I am afraid that we will not be supporting her in the Lobby.
My Lords, in response to the noble Baroness, Lady Miller, I always try to be refreshingly frank in these matters. She will certainly bring me to book if I am not. Perhaps I may challenge her on trying to put words in my mouth about where we are going on this. There was certainly reference to the fact that the figures had been eroded over time in relation to earnings, but the one-off adjustment cannot, and should not, be seen as a relinking of that with average earnings. On pensions, she will be aware that the answer is, as usual, that we need to await the Government's response to the Turner report which will, doubtless, be with us before too long.
We have been slightly political on this last amendment. I think it was a Conservative government who cut the link in the first place. I do not think I can help the noble Baroness further than I did in Committee. The Government's position on the amendment has not changed since it was discussed in Committee. As I said then, discussions on the level of the limit will continue over the next few months and I do not expect a figure to be agreed for some time. I repeat the assurances that I gave in Committee about the likely level of the limit. The Government do not have any intention of making an irresponsible increase which business cannot accept. I expect the increase to be much closer to the 10 per cent figure sought by the noble Baroness than the 100 per cent figure quoted in some press articles.
It seems to me that over and above the assurances that I have just given, the key point is that the regulations will be affirmative. This will provide an opportunity for Parliament to scrutinise what comes forward in due course. I hope that the noble Baroness will withdraw her amendment and that that has again given her the level of assurance which I sought to give her in Committee.
My Lords, I thank the Minister for his reply. I have a couple of comments. I did not attempt to put any words into the Minister's mouth. I shall look very carefully at what I said and what I thought it meant. On the fact that the noble Baroness, Lady Walmsley, cannot support us on this amendment, I shall simply have to bear that with as much fortitude as I can muster.
On the fact that the figure is still 10 per cent—I am still talking about it—the Minister is saying that he thinks it will be closer to that than the 100 per cent that was bandied around. We were talking about the figure being close to £600 a week, whereas at present it is £290. If it went up with the RPI, it might be £300 or whatever.
I really think that as these consultations will take for ever. The Minister has said that it will be an affirmative regulation, but we cannot do anything about that; we cannot amend it. I really do not like passing Bills with we know not what regulations and with consultations still taking place. In those circumstances, I shall test the opinion of the House, so that the Minister will know that I am serious about the way in which these Bills are conducted.