Second Reading

Part of Small Business, Enterprise and Employment Bill – in the House of Lords at 5:17 pm on 2nd December 2014.

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Photo of Viscount Eccles Viscount Eccles Conservative 5:17 pm, 2nd December 2014

My Lords, as many of those who have spoken this afternoon have pointed out, there are things in the Bill that should happen anyway. I ask myself: when we legislate for things that should happen anyway, will it work? As the noble Baroness, Lady Harding, said, space—a very important word—is needed if things are to happen which should happen. The question then sophisticates into: will legislation reduce or increase space? I suggest that normally it reduces space; it does not increase it.

The Bill is 279 pages long and, as is said in the memo to the Delegated Powers Committee,

“contains 75 individual provisions concerning delegated powers, 14 of which are Henry VIII powers”.

The noble Lord just mentioned the one-in, two-out policy. Someone has to get rid of 150 regulations once the Bill is enacted. Apart from its length and the complexity, it is a package of very different subjects and is largely enabling. Intentions have been mentioned several times this afternoon, and I will not go down the path to hell. Nevertheless, the question arises: what will actually be achieved? For anything much to be achieved under the Bill, it is dependent on secondary legislation, not on what is in the Bill.

Five months from a general election, which of the 12 parts of the Bill will attract public attention? Perhaps three, including late payments and the lending, borrowing and credit discussion. That raises the question: where and why is there market failure, if indeed there is? Why have people departed from 30 or 60 days? Prompt payment is in everybody’s interests. I think the noble Lord, Lord Mitchell, mentioned cash flow but if you want to wreck your balance sheet, you just let your creditors go crazy. That may not affect the public sector but, in my business life, it certainly would have been a very serious matter if my balance sheet had looked all adrift on current liabilities. I am sure that we will discuss this question more. It seems very strange that people do not believe in prompt payment. When we come to the lending and borrowing issues and the market failure, my question is: will this legislation help? I rather think, as the noble Lord, Lord Sugar, said, that it is not likely to be of much assistance. Indeed, market failure needs more careful thought than it has been given in recent times, since 2008.

Part 4, on the pubs, will certainly arouse public attention and much discussion will be had in your Lordships’ House; we have already had some. Within the Bill, there is a Pubs Code Adjudicator, which I think is modelled on the Groceries Code Adjudicator— not, if I may suggest, as yet a very successful model. The Groceries Code Adjudicator is struggling to find the role that was envisaged in the 2013 Act, and I dare say that a pubs adjudicator would have some of the same problems.

Then there is Part 11, headed “Employment”. To me, this illustrates a division in our society. When problems occur, there is a big following for saying, “Somebody else should do something about it”, and another following which says, “We would rather get on with this ourselves”. That is not the end of the division because there are those in authority who think that something should be done because people cannot be expected to do it for themselves. That lack of confidence in people is certainly not good for business, for entrepreneurship or for all the virtues that we have been discussing this afternoon. Nevertheless, many people think like that.

I come back to the public reaction to the Bill and to our discussion of it. In general, the public will conclude that it does not have much to do with them. They will have flashes of recognition: in the pub, they will hear horror stories about late payment and credit, and the lack of a willingness to give them credit. Indeed, ever since Mr and Mrs Stainton kept the Strong and Co Cross Keys pub, 65 years ago, tied pubs have been debated. There is nothing new in that. In a slightly imaginary world, a white van would arrive with a delivery and the following exchange might take place. The van driver might be asked, “How are you doing?”, and the driver might say, “I’m doing okay. I’m getting £1 an hour more because I only work for Fred”. The reply might be, “Something should be done about that”. So will go the flashes of recognition but there will not be much public debate. I look forward to subsequent stages and, since all three main parties will in general be agreed, your Lordships can be sure that there are several things in the Bill that will not work well.