Deregulation Bill

Public Bill Committee, 27 February 2014.

Jimmy Hood (Labour, Lanark and Hamilton East)

Before we begin, it may be helpful if I say a few words about our proceedings today. Members may remove their jackets, if they wish. I remind them that hot beverages are not allowed in Committee. I also remind them that the deadline for tabling amendments to be considered in a Thursday sitting is the rise of the House on the previous Monday and for a Tuesday sitting it is the rise of the House on the previous Thursday.

A selection list for today’s sitting is available in the Committee Room and shows how the amendments selected for debate have been grouped together. Amendments grouped together are generally on the same or a similar issue. The Member who has put their name to the lead amendment will be called first. Other Members are then free to catch my eye to speak to the amendments in the group. A Member may speak more than once in a single debate.

At the end of a debate on a group of amendments, I will again call the Member who moved the lead amendment. Before they sit down, they must indicate whether they wish to withdraw the amendment or seek a decision. If a Member wishes to seek a vote on another amendment in the group, they must let me know. I will work on the assumption that the Government want the Committee reach a decision on all Government amendments. Members should note that decisions on amendments take place not in the order in which they are debated, but in the order they appear on the amendment paper.

I will use my discretion to decide whether to allow a separate stand part debate on clauses and schedules following the debate on amendments to them. I hope that explanation is helpful.

Another piece of important information I want to impart to Members on the Front Benches is that I will not accept any chatter between the Front Benches, but the Whips may talk to each other outside the Committee. I do not want any chattering across the Benches. The most important person to listen to is the person who is on their feet addressing the Committee. We now come to line-by-line consideration of the Bill.

John Hemming (Liberal Democrat, Birmingham, Yardley)

On a point of order, Mr Hood. I want to declare interests as detailed in the Register of Members’ Financial Interests. It will need updating because some of my interests are going through a process of change, but in essence they are JHC Software Ltd, a software house that employs 300 people and has interests in employment law, although the software concerns financial services. I no longer own a farm, but I am a member of the Musicians Union, which is affiliated to the TUC, so I am a trade unionist.

Jimmy Hood (Labour, Lanark and Hamilton East)

I thank the hon. Gentleman for his declaration. I advise other hon. Members that they may make a declaration of interest when they speak, preferably the first time they address the Committee. That will suffice for the duration of the Committee, but if they are speaking to an amendment in which they have a particular interest, they may remind me of their earlier declaration. I hope that is helpful.

Clause 1 - Health and safety at work: general duty of self-employed persons

Chi Onwurah (Labour, Newcastle upon Tyne Central)

I beg to move amendment 3, in clause 1, page 1, line 4, leave out subsections (1) and (2) and insert—

‘(1) After section 52 of the Health and Safety at Work etc. Act 1974 (meaning of work and at work) insert—

“52A Self-employed persons: list of low risk activities

The Executive shall, for the purpose of clarifying the duty set out in section 3(2) of this Act—

(a) prepare and maintain a list of undertakings commonly carried out by self-employed persons that, so far as can be reasonably expected, will not expose any persons to risks to their health or safety; and

(b) publicise this list in such ways as the Executive thinks appropriate, including on their website.”.’.

Jimmy Hood (Labour, Lanark and Hamilton East)

With this it will be convenient to discuss amendment 4, in clause 1, page 1, line 10 at end insert—

‘(2A) Regulations resulting from the amendments made by subsection (1)(2) of this Act shall be made by statutory instrument.

(2B) A statutory instrument under subsection (2A) shall be made until—

(a) the Secretary of State has—

(i) consulted with relevant parties; and

(ii) conducted and published a full impact assessment; and

(b) the instrument has been laid in draft and approved by resolution of both Houses of Parliament.

(2C) The Secretary of State shall—

(a) review the definitions of prescribed undertakings specified in regulations resulting from this section annually; and

(b) publicise widely the prescribed undertakings and any subsequent changes made to those regulations.

Chi Onwurah (Labour, Newcastle upon Tyne Central)

It is a pleasure to serve under your chairmanship, Mr Hood. I am particularly indebted to you for your direction that the most important person is the one on their feet. It is also a pleasure to open consideration of the Bill. This is only my second Bill Committee. My first was also on deregulation, so clearly I must be doing something right. I know that many members of the Committee are, likewise, veterans to deregulatory legislative scrutiny. I therefore hope they all share my conviction of the importance of safe and considered deregulation.

The Bill may not appear very exciting on the face of it, but it contains important proposals. I am sure that all members of the Committee have read the minutes of the Joint Committee. I read in them that the Minister without Portfolio described the Bill as “Oliver’s Bill”. Obviously Oliver has had enough, as both the Minister for Government Policy and the Minister without Portfolio appear to have more pressing matters to attend to in the next four weeks.

Oliver Heald (Conservative, North East Hertfordshire)

Of course, the Bill has not lost all the Olivers, because I am called Oliver and it is my Bill too.

Chi Onwurah (Labour, Newcastle upon Tyne Central)

I am grateful for that clarification and the reminder that we have an Oliver to guide us through.

My previous sojourn on a Bill Committee was when the Enterprise and Regulatory Reform Act 2013 was being considered. On that occasion, the Government delegated the leadership of Committee proceedings to a Liberal Democrat. The Minister of State, Department of Health, the hon. Member for North Norfolk (Norman Lamb)—who was then Under-Secretary of State for Business, Innovation and Skills—was a man of hidden talents. For reasons that I do not think your patience will extend to allowing me to rehearse, Mr Hood, when we completed our deliberations we left him a present: my hon. Friend the Member for Edinburgh South (Ian Murray), the shadow Minister for Trade and Investment, gave him the book “Fifty Shades of Grey”. I hope we will all learn to appreciate each other’s talents similarly. It is certainly a great pleasure to have the Parliamentary Secretary, Office of the Leader of the House of Commons, and the Solicitor-General here.

As I said on Second Reading, the Bill is the Christmas tree Bill to end all Christmas tree Bills. I was surprised, given its breadth, that there are no proposals in it to deregulate the Christmas tree industry. After 13 years of complaints about the previous Government stifling business, including the banking sector, with regulation, we have a Bill that will remove £10 million of burdens. All businesses in the UK will share that £10 million benefit over 10 years. As my hon. Friend the Member for Hartlepool (Mr Wright) said on Second Reading:

“It takes four fifths of a second for the British economy—for the hard work and effort of millions of people and enterprises—to generate that potential saving of £1 million a year.”—[Official Report, 3 February 2014; Vol. 575, c. 97.]

Amendment 3 would remove subsections (1) and (2) from clause 1, and would instead introduce a duty on the Health and Safety Executive to maintain a list of low-risk activities. Clause 1 would exempt from health and safety legislation self-employed persons who do not pose a significant risk of harm to others. The Secretary of State can prescribe a list of the activities that would be expected to pose such a risk of harm, and self-employed persons undertaking prescribed activities must comply with section 3(2) of the Health and Safety at Work, etc. Act 1974. The clause comes from a review of health and safety legislation by Professor Löfstedt.

The Opposition, too, seek to minimise the obstacles to growth and expansion that small businesses face; it is very important to us, so we support the removal of unnecessary burdens. There is consensus on that. However, it is important to think about the words “unnecessary” and “burdens”. Health and safety for self-employed people with no employees is rarely unnecessary and, where it exists, it is not a burden. If it is necessary, it is not a burden; if it is not there, it is not unnecessary.

The Association of Personal Injury Lawyers—a group that some cynics might think would have an interest in more health and safety litigation—opposes the clause, saying:

“The work that self-employed people have to undertake to ensure that they comply with health and safety law is therefore minimal, and is not a burden.”

When the Cabinet Office consulted on clause 1, it found no clear consensus of opinion, while a significant number of respondents said they preferred no change in the law. The written and oral evidence to both the Joint Committee and this Committee showed fairly lukewarm support from business organisations. Importantly, where there was support, it was for addressing the perception of regulation and showed support for the clause only in as much as it addressed the perception of regulation. Almost all respondents conceded that clause 1 would have little impact beyond addressing the perception of regulation. Our amendment would address that perception of regulation, rather than potentially undermining the health and safety of self-employed people.

Toby Perkins (Labour, Chesterfield)

My hon. Friend is entirely right about the response of the business groups. If the British Chambers of Commerce or the Federation of Small Businesses were not in support of a deregulation Bill, they would have an existential crisis. It is clear, however, that they considered the change to be something that would make a very small difference and was actually about the Government trying to do something deregulatory. That lukewarm support stands in stark contrast to some of the risks, which I am sure my hon. Friend will identify, and puts the Bill in context.

Jimmy Hood (Labour, Lanark and Hamilton East)

Order. The hon. Gentleman made a rather longer intervention than was absolutely necessary. For the duration of the Committee, I ask for interventions that are a lot shorter than the first example.

Chi Onwurah (Labour, Newcastle upon Tyne Central)

Thank you, Mr Hood. I thank my hon. Friend for that contribution, which may have been long, but reflects his long experience running a small business and his experience of the opportunities and safety requirements that small businesses have. He is absolutely right. As I will set out, the clause is unlikely to benefit small businesses and self-employed people, and risks being significantly negative. That is why we seek to amend it.

I will return to perception in more detail, but let me say that a Government who constantly deride health and safety laws as unnecessary—I hope no one in this Committee will be guilty of that—create more of a problem with perception than a law does, and certainly more than a law that, in practice, has been working well and saving lives for more then 40 years. The legislation has been in place for four decades. During that time the economy has had its ups and downs, as we have all seen and can testify to, but it is not health and safety that has depressed the economy. I would be interested to hear evidence from those who claim that health and safety laws put off potential entrepreneurs and sole traders. Perhaps the Minister will present it. The evidence seems largely anecdotal. We have seen such a situation before. The previous Bill Committee that I served on—the Enterprise and Regulatory Reform Bill Committee—tried to shoehorn in many proposals from the Beecroft review, which seemed to be entirely based on anecdotal evidence.

Let us assume for a moment that health and safety laws deter an army of entrepreneurs—although I think that is unlikely, because there has been an exponential rise in the number of people choosing self-employment. The clause might have the unintended consequence of deterring entrepreneurs from hiring their first employee, because they would suddenly be bound by health and safety laws. Nor will the clause save entrepreneurs much time. As we heard during the evidence sessions, for many self-employed people who undertake non-risk activities, a health and safety risk assessment can be undertaken in their heads. It does not require much time. Whether or not we remove the criminal duty, a common-law duty of care remains.

The clause poses questions and will create confusion. That is why amendment 3 seeks to address the perception of the burden without creating confusion. I want to reiterate our support for businesses and the removal of unnecessary burdens. When in government—[Interruption.]

Jimmy Hood (Labour, Lanark and Hamilton East)

Order. I must say to the hon. Member for Derby North that I cannot let that go without making a comment. May I remind all hon. Members to ensure that their hand-held devices are on silent?

Chi Onwurah (Labour, Newcastle upon Tyne Central)

Thank you, Mr Hood. I hope my hand-held devices are already following your direction.

When in government, Labour introduced programmes for simplifying regulation that delivered £3 billion of savings to businesses per year without endangering the lives of working people. I am not exaggerating when I say that the proposal is a matter of life and death. Self-employment is a long-standing challenge for the construction industry. We have pledged to take action on the problem of what we call “bogus self-employment” when we come to government. Committee members know that the construction industry will not be covered by clause 1, but can Government Members be confident that that message will go out to the 2 million people employed in that sector? The law as it stands is clear: everyone is covered. No self-employed person with no employees has ever sued themselves for a breach of health and safety legislation.

I understand what Ministers want to achieve. They are targeting sole traders who work at home on a computer. In reality, no burden is being lifted from them because the situation will not change

“for those who genuinely do not pose a risk to others”.

That is why our amendment seeks to address the perception of, and information about, the reality of health and safety legislation, rather than undermining it.

In the economy as a whole, fatalities among self-employed workers are more than twice as high per million as among employees. Self-employed workers are at more than twice the risk of health and safety fatalities. In 2012, 27 million days of productivity and value were lost due to health and safety incidents. According to Health and Safety Executive estimates, the total cost to business is £13.4 billion per year. Its research shows that the most frequent causes of injury are manual handling, slips, trips and falls from height. Those basic incidents are preventable with simple precautions, and the risks can be assessed relatively easily, simply and quickly. The TUC told the Joint Committee that the most dangerous industries have a higher proportion of self-employed people in them. Anything that causes confusion in that situation is a recipe for disaster. The fatality rate for self-employed people is 1.1 per 100,000 against 0.4 per 100,000 for employees.

Health and safety is often maligned but has saved thousands of lives. The Health and Safety at Work, etc. Act 1974 changed the culture of workplaces in this country. Since then injuries at work have fallen by 77% and fatalities by 83%. This country has an enviable reputation as a health and safety world leader. We have the lowest rate of fatal injuries in the EU. That is something to be proud of. Whatever hon. Members’ views of the EU—I will not ask for interventions on that point—the fact that we have the lowest rate of fatal injuries in the EU should be a source of pride. I counsel caution in introducing confusion that may undermine that record. The amendment seeks to address the perception of health and safety burdens by requiring the HSE to maintain the list.

The Royal Society for the Prevention of Accidents told the Joint Committee that self-employed lone workers who work at home are de facto already exempt. That is a very important point. The Joint Committee also heard from the Institution of Occupational Safety and Health, which has nearly 70 years’ experience. It was clear that the burdening of health and safety on the self-employed was minimal, and that a risk assessment was such a quick and easy thing that a child could do it. In its view, the clause was “unnecessary, unhelpful and unwise” and would be a short-sighted and misleading move that would not help anyone. It would not support business but would cause general confusion. A report from the institution in 2010 put forward wider benefits of the status quo.

“We believe that taking sensible steps to protect yourself, others who you may engage to help you, and the public, is good for the self-employed person, good for their business and good for UK plc...People who are injured or are ill will need support from GPs, NHS and possibly social services. So, it makes economic sense all-round for people to take sensible steps to look after themselves at work.”

One company that works with health and safety equipment pointed out:

“Self-employed workers are more likely to turn to the state for support when they incur injuries, as it is unlikely that they would receive sick pay to cover their period of absence. This results in not just increased costs to self-employed workers when they are injured, but also leads to increased financial pressures on the welfare budget which will support them whilst they are out of work.”

I emphasise that point. At a time when much pressure is being brought to bear on the welfare budget and there is much debate about how it can most effectively support those getting into work, do we really want to introduce a potential risk that could lead to more self-employed people incurring accidents?

Government Members must realise that what appears to be a deregulatory measure is not quite what it seems. Like many measures in the Bill, it may simply shift a burden from one group of people to another. And what a burden: 37.5p per self-employed person, although that seems to be an overestimate, as we heard in the evidence to the Joint Committee. The hon. Member for Birmingham, Yardley, who sat on the pre-legislative scrutiny Committee—he must be a glutton for punishment—estimated it to be closer to 4p a year.

Clause 3(2) of the 1974 Act states:

“It shall be the duty of every self-employed person to conduct his undertaking in such a way as to ensure, so far as is reasonably practicable, that he and other persons (not being his employees) who may be affected thereby are not thereby exposed to risks to their health or safety.”

Is that really an unnecessary burden? Are we saying that those who are not in the list that the Minister is proposing should not conduct their undertaking in such a way as to ensure, so far as is reasonably practicable, that they and other persons are not exposed to risks? Are we saying that they should conduct it in such a way that other persons are exposed to risks?

In the example of a novelist, used both in evidence to the Committee and on Second Reading, it is a matter of common sense that he or she should ensure that they do not write a book in such a way that harms somebody else. Unless they are writing in blood or it is a murder mystery and they are undertaking rather active research, I can see no possible way that they could write a book—their undertaking—in a dangerous way, so in that case there is no burden. If Government Members of the Committee have some evidence for the burden that not writing a book in a dangerous way represents, I hope they produce it, rather than risk creating confusion for thousands of self-employed construction workers, for example. Should the novelist decide that, as part of writing her book, she undertakes, for example, some activity that ends up hurting somebody, she would be liable for a prosecution.

The fact is that if people cause injury to others, by definition their activity poses a risk to others. In short, if people pose no risk to others, health and safety is not a burden and a common law duty of care still applies. The current law requires action only to prevent risk. If there is no risk, there is no problem to solve.

As the TUC said in its written evidence,

“The Bill states that the proposals are being done ‘for the reduction of burdens resulting from legislation for businesses or other organisations or for individuals’. In fact it does the opposite as it does not actually change the situation for those who genuinely do not pose a risk to others and only creates complete confusion for all the other self-employed.”

The dangers of that in the construction sector are clear, but confusion could be created in other, perhaps less obvious, sectors. For example, the Broadcasting, Entertainment, Cinematograph and Theatre Union said:

“Despite being categorised by the Secretary of State as a “low-risk” industry, many self-employed workers in the sector are engaged in activities that involve significant hazards, both to them and others”.

I am sure we can imagine situations in which film sets—perhaps those in films that we have seen—could pose risks to the health and safety of the self-employed people working there.

It is dangerous when we start saying that one sector is dangerous and should be covered, but that another is not and so should not be covered. Confusion is bad for workers and bad for business, especially when it serves no purpose and lifts no burden. The clause will not change that. It is interesting that the outcome may well be exactly the opposite of what Ministers say they want to achieve.

The Committee heard on Tuesday how clause 1 might well lead to a proliferation of health and safety consultants and create an up-front cost to businesses in familiarising themselves with the law. Indeed, the impact assessment sets out quite a significant up-front cost to business, which may yet be an underestimate. As has been pointed out in evidence, the self-employed and small businesses are among the hardest communities to reach with specific and detailed messages.

The HSE said that the list of prescribed descriptions would be made through regulation but that the duty might still apply to individuals even if their activity was not listed. I am struggling to see why the provisions that amendment 3 would remove have been included. The vast majority of interested parties in the consultation did not favour the provisions, and they have received lukewarm and shaky support from business even though we are told that business is driving the changes. All that the provisions will do is to create confusion where at least some clarity exists. We join the Government in supporting increased clarity in health and safety where it is possible to achieve that without undermining health and safety, so the amendment is designed to extend existing clarity without removing important employment rights. Subsections (1) and (2) of clause 1 exempt the self-employed from health and safety legislation unless they undertake prescribed activities, but amendment 3 would replace those subsections with a new duty on the HSE to

“prepare and maintain a list of undertakings commonly carried out by self-employed persons that, so far as can be reasonably expected, will not expose any persons to risks to their health or safety”.

In short, that would be a list of activities in which the self-employed were not likely to hurt themselves or others. The HSE would be required to publicise that list to novelists, for example, and to others that undertake low-risk activities so that they know, if they did not already, that there is little chance of their harming anybody and so they are de facto exempt from duties associated with section 3(2) of the 1974 Act. If the Minister really wants to challenge negative perceptions of health and safety, he should do so directly rather than pandering to such perceptions by removing health and safety provisions. The IOSH said:

“We are not so clear that this would improve the perceptions.”

The institute was talking about the clause as it stands, without our amendments.

“It could even make it worse. It could reinforce the current regulatory myths and the negative stereotypes that abound about health and safety.”

Addressing misconceptions about health and safety should be done through education and publicity, and that is what amendment 3 seeks to do. Adding to the confusion with a measure such as the existing clause—without our amendments—will do the opposite of what is needed. Amendment 3 would help to make the law clearer without repealing a law that has helped to keep us safe for 40 years. If the Minister wants to add some clarity to health and safety legislation, he will accept the amendment.

Amendment 4 is a probing amendment that seeks to understand what kind of controls and safeguards Ministers have in mind, as the clause as drafted poses the risk of exempting large sections from health and safety while increasing confusion. The amendment would require the Secretary of State to consult relevant parties, and to conduct and publish a full impact assessment before setting out what activities should be covered. It would also require the Secretary of State to review the arrangements and ensure that the rules are clearly publicised.

The Government have published a draft list of prescribed activities. I have read through them, as I am sure has everybody, but I am not sure how much the wiser I am. For example, I was pleased to learn that all those self-employed people working with ionising radiation will continue to be covered by health and safety, as will those self-employed people manufacturing and storing explosives. Will the Minister tell the Committee how many self-employed people are undertaking either of those two activities? How many people does he actually expect will be exempted?

Browsing through the list, I could not see hairdressers listed anywhere. Maybe I missed them—I do not know—but if that is the case, the clause is already confusing people before it has even become law. Does the Minister really think that the many self-employed hairdressers with no employees should undertake their activity without regard to the risk that they pose to others and without having to consider the health and safety of their customers?

Just three months ago, I remember the Deputy Leader of the House sporting a moustache for Movember. I am not sure whether he visited a barber, perhaps a self-employed barber, to have it shaved off, but if he did, conscious as I am for his safety, I would like to think that before a barber took to his face with a cut-throat razor—

Tom Brake (Liberal Democrat, Carshalton and Wallington)

I reassure the hon. Lady that I removed the moustache myself, although I did not do a risk assessment.

Chi Onwurah (Labour, Newcastle upon Tyne Central)

I thank the Minister for that clarification. He might not have done a risk assessment, but I am sure that in removing that moustache he felt confident that he did not pose a risk to himself, or he would not have undertaken doing so. That underlines the point.

John Hemming (Liberal Democrat, Birmingham, Yardley)

I must admit that at times, I have cut myself shaving, so I do therefore pose a risk to myself, but I must admit also that I shave myself.

Chi Onwurah (Labour, Newcastle upon Tyne Central)

I am saddened to hear that the hon. Gentleman poses a risk to himself when he shaves. I hope that that risk is diminishing and that he will not seek to offer money to himself for his services and then sue himself for not having due regard to health and safety. This exchange has illustrated how relatively easy it is to do a simple health and safety assessment for the kinds of activities that the clause seeks to exempt.

At the same time, the clause runs the risk of exempting many activities that could pose health and safety dangers to others, such as hairdressing. I would like to think that before a hairdresser applies chemicals that can be extremely dangerous to someone’s hair, they consider the risks.

Caroline Nokes (Conservative, Romsey and Southampton North)

The hon. Lady makes an interesting point. The use of chemical hair dyes carries a significant risk and we have seen recent press coverage about people who have died from an allergic reaction to them. Does she agree, however, that most responsible hairdressers carry out a patch test before they consider putting dye on people’s hair?

Chi Onwurah (Labour, Newcastle upon Tyne Central)

To my knowledge, most responsible hairdressers do exactly that. Certainly, hairdressers should act responsibly and, therefore, in accordance with health and safety legislation. The existing legislation says that they should carry out their undertaking with due regard to their customers’ health and safety and the burden of such legislation is a common-sense, professional and responsible approach to their profession.

Kelvin Hopkins (Luton North) (Lab) rose—

Chi Onwurah (Labour, Newcastle upon Tyne Central)

Hairdressing appears to be a subject of great interest.

Andrew Bridgen (Conservative, North West Leicestershire)

Not for Kelvin—[ Laughter. ]

Kelvin Hopkins (Labour, Luton North)

My hon. Friend makes the point about chemical processes being used to beautify people, such as to take off eyebrows. I had a case in my constituency in the past month that I have written to the Secretary of State about. The unregulated nature of the chemicals used for such treatments means that terrible accidents occur. As the hon. Member for Romsey and Southampton North said, these cases have been covered in the media and I think that such practices should be more regulated than they are.

Chi Onwurah (Labour, Newcastle upon Tyne Central)

As this is a Deregulation Bill, we are not looking to propose regulations, but I will be meeting with the Hairdressing Council to discuss safety in the industry. Unfortunately, there are many examples of real injuries. Perhaps I should declare an interest inasmuch as I have had chemical burns from a hairdressers.

Thomas Docherty (Labour, Dunfermline and West Fife)

I have had a chance to look at Hansard from 30 November 2011, which shows that the hon. Members for Romsey and Southampton North and for Birmingham, Yardley both voted for the proposed amendment to the Hairdressers (Registration) Act 1964. We look forward to their support today.

Chi Onwurah (Labour, Newcastle upon Tyne Central)

I thank my hon. Friend for that typically perceptive contribution. I find it hard to reconcile supporting improved safety and professionalism in hairdressing with exempting all self-employed hairdressers, of which there are many—perhaps the Minister could tell us how many—from health and safety regulations.

Caroline Nokes (Conservative, Romsey and Southampton North)

I thank the hon. Lady for giving way again. I probably should declare an interest—although I will cover up my roots frantically.

There is a significant problem not with hairdressing but with hairdressing products. Potent dyes can easily be bought over the counter in most chemists so people can dye not only their own hair but other people’s hair. We are in something of a minefield here, because it is perfectly possible for somebody who is not a hairdresser to dye the hair of a relative, a friend or an acquaintance.

Chi Onwurah (Labour, Newcastle upon Tyne Central)

The hon. Lady makes an interesting point. I am not going to declare an interest in my roots, but I have spent significant time at the hairdressing counters of chemists. It is certainly true that many people buy strong chemicals for their own use and to use on their friends. Some kind of remuneration often takes place, so the definition of self-employment will increase the confusion about whether they must think about health and safety regulations when they dye other people’s hair. We do not want to encourage that.

Thomas Docherty (Labour, Dunfermline and West Fife)

I wonder whether my hon. Friend is as confused as I am. Government Members voted for a Bill to

“provide for the mandatory registration of hairdressers with the Hairdressing Council; to empower the Hairdressing Council to issue and charge for licences to hairdressers holding certain qualifications; to provide for the removal of names from the register by the Hairdressing Council”

and

“to introduce a scale of fines”—[Official Report, 30 November 2011; Vol. 536, c. 974.]

for operating without a licence, but they will not support basic health and safety regulations.

Chi Onwurah (Labour, Newcastle upon Tyne Central)

My hon. Friend eloquently expresses my confusion. If Government members of the Committee do not vote for our amendment, it will seem a wholesale contradiction to support increased regulation of an industry in one vote, and then exempt self-employed members of the same industry from all regulation.

Oliver Heald (Conservative, North East Hertfordshire)

Of course, the handling of a sensitising substance of the sort used for colouring hair and in other hairdressing activities is on the prescribed list already. It is the second item down, under handling, storage, transport and use. It lists various items, including sensitising substances, so anything of that sort would be covered. [ Interruption. ] I will just make the point that the HSE will consult on that list before it becomes part of the regulations. If there are other issues, they can be considered.

Chi Onwurah (Labour, Newcastle upon Tyne Central)

I am afraid that the Minister has added to my confusion. I thought I had committed that list to memory, but clearly I had not entirely. I read it many times, and it was not apparent that hairdressers are covered. If I were a hairdresser, I would not think it applied to me.

Toby Perkins (Labour, Chesterfield)

First, I want to say that when people were declaring their interests, I was getting nervous. I just want to draw the Committee’s attention to the fact that I do have hair.

I share my hon. Friend’s confusion. If hairdressers are included, they certainly would not expect to be. If chemicals are included, perhaps hairdressers who do not do dyeing are not included, but scissors and razors are pretty sharp. The Minister has made the clause even more confusing. I thought that he was wrong, but now I am not even sure of that.

Chi Onwurah (Labour, Newcastle upon Tyne Central)

I thank my hon. Friend. I wonder whether a hairdresser who was moving a chemical substance would be outside the exemption, only to be covered by it once they picked up their scissors. Perhaps we could have that point clarified.

John Hemming (Liberal Democrat, Birmingham, Yardley)

When I agreed with the Whips office to undergo the punishment of sitting on this Committee, it was on the condition that I need not necessarily support the Government on every clause.

Thomas Docherty (Labour, Dunfermline and West Fife)

On a point of order, Mr Hood. Can serving under your chairmanship ever be described as a punishment?

Jimmy Hood (Labour, Lanark and Hamilton East)

I am sure that, in years gone by, some have thought of it in that way.

John Hemming (Liberal Democrat, Birmingham, Yardley)

The hon. Member for Newcastle upon Tyne Central described me as a glutton for punishment, since I am on the Select Committee on Regulatory Reform—an excellent Committee with an excellent Chair—and was on the Joint Committee for pre-legislative scrutiny of the Bill. Of course, my view of the clause will not be known until I speak on the amendment, but I want to make the point that there is a difference between the law of tort, relating to the damage that someone does to someone else, and health and safety regulations. That is not necessarily an argument to substantiate the hon. Lady’s case.

Chi Onwurah (Labour, Newcastle upon Tyne Central)

I thank the hon. Gentleman and look forward to seeing his voting behaviour. His comment was important, but I think that the issue I am raising is relevant. There is obviously a difference between the law of tort and health and safety legislation, but what we want to achieve, and the objective that I hope is shared on both Government and Opposition Benches, is the improvement of health and safety.

Regardless of where legal responsibility and blame might lie, we want to improve the health and safety of self-employed people, because that would be a good in itself. There would be a contribution to the economy, it would be better for society and it would reduce the burden on the welfare state. We want better health and safety, so there is an objection to anything that contributes to confusion on health and safety.

John Hemming (Liberal Democrat, Birmingham, Yardley)

The point I am making is that there is no exemption from a duty to ensure that people—the people having their hair dyed—are safe. My hair, I must admit, has not been dyed, but I have a little bit left. [ Interruption. ] You never know. It is a sort of indicator of age and experience.

The point is that people would not be absolved from the responsibility and duty to minimise accidents; the law of tort would maintain that. So even if hairdressers were exempt—which they are not—they would not be exempt, anyway.

Chi Onwurah (Labour, Newcastle upon Tyne Central)

I may want to quote that in future—even if they were exempt, they would not be exempt anyway. We have had a profound summary of the impact of the measure.

Andrew Bridgen (Conservative, North West Leicestershire)

Perhaps I may share some thoughts. My degree was in behaviour and genetics. Human beings are programmed to make risk assessments consciously or subconsciously thousands of times a day from when they get up in the morning, including such things as crossing the road. The mere fact that we are all here means that we are quite good at making those risk assessments; otherwise we would not be here any longer. Indeed, most people would regard it as common sense, without the need for legislation or regulation. Perhaps common sense is not always as common as we should like, but the whole population will have to make a huge risk assessment next May.

Jimmy Hood (Labour, Lanark and Hamilton East)

Order. The hon. Gentleman has moved a little far from the subject in his intervention.

Andrew Bridgen (Conservative, North West Leicestershire)

I think you knew where I was going, Mr Hood.

Chi Onwurah (Labour, Newcastle upon Tyne Central)

I think we do know where the hon. Gentleman was going, and I know where I think he will be going in the next year. I look forward to a longer speech from him.

Our discussion on hairdressing has highlighted significant flaws in the clause, which our amendments are intended to probe. Perhaps it will be beneficial if we do not move on to the subjects of mountain guides and beekeeping, which were discussed with some fervour on Second Reading. As the Minister without Portfolio put it, only

“A small and select group of specialist people”—[Official Report, 3 February 2014; Vol. 575, c. 98.]

took part in the Second Reading debate, in which we were treated to a speech by my hon. Friend the Member for Bassetlaw (John Mann) about mountain guides and beekeepers. Unfortunately, that did not attract quite the same debate and good humour.

The list may be in draft form, but the huge potential for loopholes and further confusion is already clear. I am not convinced that the Government have a clear idea of how they will make the clause work, so we are attempting to draw that out through amendment 4. Will the Minister tell us how the list was drawn up and who was consulted? How were activities determined to be dangerous, where does the threshold lie and who decided on that? What safeguards are in place to ensure that no grey areas emerge? What plans do the Government have to review the workings of the clause and its impact?

Amendment 4 would provide for significant scrutiny, including parliamentary scrutiny, and consultation on that list, which may involve significant work for the Minister. The greatest proportion of the Bill deregulates and reduces burdens on Ministers rather than business, despite the Bill’s objective being not to make life easier for Ministers but to reduce burdens on businesses and reduce regulatory burdens altogether. We want to understand that the activities on that list can be justified by evidence and that, if the Minister truly is proposing to take such a risk with our excellent health and safety record, the list can be revisited in time.

John Hemming (Liberal Democrat, Birmingham, Yardley)

You are an excellent Chair, Mr Hood—that is no criticism of the members of this Committee. I have spent a lot of time looking at all these issues. I declared my interest earlier: I have been self-employed—I was on my own initially, in 1983—and my companies now have 300 staff. Therefore, we are now covered by health and safety laws. At one time, however, my business was made up of someone with a computer, which is exactly the sort of situation we are discussing.

I have certain principles on rules and laws. One of them is “If it ain’t broke, don’t fix it” and the other is “keep it simple”. Sadly, the clause fails on both. I am therefore unsure whether I can support the Government, as I have not been given a good reason to support the clause. Amendments 3 and 4 also fail, because they would further complicate a clause that complicates a relatively simple situation.

The impact assessment provides the best argument for why the clause should be gently forgotten and drift into the mists of time. It says that the initial impact of the clause on business will be a cost of £1.7 million. There would be a gradual move towards savings in theory, but the confusion that we have experienced in our discussions on what is in, what is out and what is going on would be replicated across the country. Were the clause to go through, I do not think that it would provide a massive hazard to health and safety, but it would create a lot of work for no real benefit.

Health and safety is important and we want to see improvements that prevent people from getting hurt at work or whatever it may be. There is no question about that. It is also true that people use health and safety as a spurious reason for not doing things. That is not supported by the Health and Safety Executive and it is an issue of concern in the country. There are two measures that people abuse: one is data protection and the other is health and safety. They use them as if they trump all other rational considerations. It is a problem and it needs fixing. The clause does not fix the situation; it fixes something that is not broken.

Chris Williamson (Labour, Derby North)

That is more of an urban myth. Can the hon. Gentleman give concrete examples of where health and safety has meaningfully made a difference in stopping something from happening?

John Hemming (Liberal Democrat, Birmingham, Yardley)

We have had problems with parades, for instance. There can be circumstances in which the response of the police to rolling road closures has massively increased the cost of parades. That might be about insurance—the insurers might have over-complicated the situation—or it might be that somebody cannot be bothered. That is a good example because historically in Birmingham we used to have lots of parades with rolling road closures.

Toby Perkins (Labour, Chesterfield)

The hon. Gentleman makes an important point. One thing applicable to whole deregulation argument is that when businesses talk about regulation, they do not always mean regulation. Sometimes they mean insurance or saving themselves from getting sued, but not the things that the Government are talking about under the heading of regulation, which so many of us in business talk about.

John Hemming (Liberal Democrat, Birmingham, Yardley)

Indeed. It tends to be used as a justification, hence the media stories about it. Something must be done—the clause is something, but it is not necessarily something that will achieve anything.

Chris Williamson (Labour, Derby North)

Is that the best the hon. Gentleman can do? Is he really suggesting that we should go forward with this legislative measure on the basis of a problem with parades? That is just ridiculous. If that is the best example he can come up with, there is frankly no justification.

John Hemming (Liberal Democrat, Birmingham, Yardley)

The hon. Gentleman obviously has not been listening.

Thomas Docherty (Labour, Dunfermline and West Fife)

The hon. Gentleman makes an interesting and important case. Does he agree that part of the problem is that people hide behind health and safety when the issue is not health and safety? In fact, the HSE has run campaigns to say, “This is not us. We do not support this nonsense.”

John Hemming (Liberal Democrat, Birmingham, Yardley)

That is exactly the point I am making.

John Cryer (Labour, Leyton and Wanstead)

The hon. Gentleman refers to the insurance issues. Today we are talking mainly about the Health and Safety at Work, etc. Act 1974, which is riddled with the phrase

“so far as is reasonably practicable”.

That gives an awful lot of companies and others a get-out, because they can say, “It wasn’t reasonably practicable to undertake that risk assessment or spend money on those safety features.” Since the Act received Royal Assent in, I think, 1975, the phrase has allowed people all sorts of loopholes.

John Hemming (Liberal Democrat, Birmingham, Yardley)

That is also true. I do not think that there is a substantive problem with health and safety legislation. There is clearly an issue with people using it as an excuse to stop people doing things when there should be a rational argument. The hon. Member for Dunfermline and West Fife made exactly the right point earlier.

Andrew Bridgen (Conservative, North West Leicestershire)

My hon. Friend talks about how “reasonably practicable” is used in health and safety legislation. Is it not true that what is deemed reasonably practicable prior to an accident is often not deemed reasonably practicable just after the accident has happened? That is a great worry for an employer.

John Hemming (Liberal Democrat, Birmingham, Yardley)

That is true, but we are moving further and further from amendment 3.

Thomas Docherty (Labour, Dunfermline and West Fife)

On the point made by the hon. Member for North West Leicestershire, is not the clause about self-employed people, not employers?

John Hemming (Liberal Democrat, Birmingham, Yardley)

That is also true, and we return to the point that the clause provides a solution to a different problem than the one that exists. It does not solve a problem; it creates an additional burden for business of £1.7 million, which gradually whittles down over the years. I have not tried to calculate when business runs into profit.

Andrew Bridgen (Conservative, North West Leicestershire)

The simplest solution is to take out of health and safety legislation altogether the self-employed whose activities pose no risk. Then there is no confusion. It is straightforward and exactly what happens in Germany, France and Italy—economies with which we must compete.

John Hemming (Liberal Democrat, Birmingham, Yardley)

That is true, but we have to compete on the basis, in part, of quality and, in part, of price. If this puts our prices up, it is not necessarily a good idea.

Kelvin Hopkins (Labour, Luton North)

I want to speak briefly about this issue. I congratulate my hon. Friend the Member for Newcastle upon Tyne Central on her excellent speech. She made many important and valid points. I wanted to speak because I have particular concern about health and safety, which has been under attack in certain areas of the media. The provision is a token Government swipe at health and safety, but possibly the thin edge of the wedge for more radical attack later.

Health and safety has made a real difference to working people in Britain over several decades. I have a personal interest, because I was at the TUC in 1974 when the legislation went through. It was seen as a great victory —not only for working people, but for everyone. As my hon. Friend said, the costs of people being injured at work, or dying, are enormous—in wider social terms, as well.

At the time, I was also the staff member responsible for setting up the TUC construction committee. Construction was bedevilled, as it is even now, with bogus self-employment and a terrible record on health and safety. Thousands of people must have survived who might otherwise have died, or lived a healthy life who might otherwise have been injured, thanks to that legislation. It has been enormously beneficial.

I am certainly the oldest person in the Committee. I remember working in industry in the 1960s before the legislation came through. I saw horrendous practices. I will not go into detail, but industry was an extremely dangerous place. In my own brief experience of industry, I saw a number of serious problems that were subsequently addressed by the legislation.

Andrew Bridgen (Conservative, North West Leicestershire)

The hon. Gentleman talks about genuine concerns about bogus self-employment. Is he not somewhat relieved, therefore, that the Bill will mean that the risk is on activity, not job titles? The activities of the person, whether self-employed or bogusly self-employed, account for whether they are in or out of health and safety legislation.

Kelvin Hopkins (Labour, Luton North)

If the individual is taken out of the legislation, they will not be inspected at all.

I want to talk about bogus self-employment. We have seen an enormous rise in self-employment in recent years, which is often for tax avoidance or possibly even tax evasion reasons. Certainly that was true in the construction industry all those years ago. Employees would take cash in hand, taking some financial benefit by not paying tax and national insurance. That has been addressed to some extent over time. Of course, bogus self-employment is still going on and many people in the IT sector are really employees in a genuine sense, but technically work as self-employed people.

Toby Perkins (Labour, Chesterfield)

I agree entirely with my hon. Friend. He is saying that bogus self-employment continues. In fact, it is proliferating hugely. We are seeing not just IT contractors and construction workers, but a whole raft of staff—in accounts, sales and so on—who to all intents and purposes look like employees, but are contracted on a self-employed basis.

Kelvin Hopkins (Labour, Luton North)

My hon. Friend is absolutely right and reinforces my point. The real employers—if the position is legitimate, they will be the main contractors—might set up workplaces for supposed self-employed people, and would not be subject to restrictions or have to have regard to health and safety if some provisions in the Bill are enacted. I support the amendments of my hon. Friend the Member for Newcastle upon Tyne Central, but my preference would be for this part of the Bill to be removed entirely. If that were proposed, I would support it. In the meantime, I will support my hon. Friend, who has made some valid and important points, which would mitigate the Bill’s effects if it were unamended further.

John Cryer (Labour, Leyton and Wanstead)

I was not trying to intervene, but I find it difficult to shut up once I am on my feet. I am going to talk on this subject shortly. Does my hon. Friend agree that the proliferation of practices such as introducing payroll companies into the economy means that bogus self-employment is becoming more, not less, serious?

Kelvin Hopkins (Labour, Luton North)

My hon. Friend is absolutely right. The sheer cost to society of bogus self-employment in terms of tax avoidance and evasion is enormous. The tax gap is gigantic, so encouraging self-employment is not a good idea. I would like to see a lot of it abolished and people brought back into proper employment, where employers would have a duty to adhere to health and safety legislation.

I return to my original point. Certain sections of the media and some employers go on and on about health and safety. Health and safety legislation has made an enormous difference to society; it has been massively improving in so many ways; yet that attack is now reflected in this legislation.

Oliver Heald (Conservative, North East Hertfordshire)

I am sure the hon. Gentleman would accept that this legislation does not change the definition of who is self-employed. It is all still there in section 53 of the 1974 Act.

Kelvin Hopkins (Labour, Luton North)

Indeed, and I thank the Minister for his intervention. The fact is that this legislation is about pandering to that pressure from outside and not about a real burden on employers. Employers, if legitimate, have to pay taxes. If health and safety legislation is reduced in extent, more people will suffer injury, our tax bill will go up to pay for the suffering of people who have been injured or have died at work, and society will not benefit in any way.

I hope we can support the amendments. In my best of all possible worlds, I would like to see this clause entirely removed.

John Cryer (Labour, Leyton and Wanstead)

It is a pleasure to serve under your chairmanship, Mr Hood. I support the amendments in the name of my hon. Friend the Member for Newcastle upon Tyne Central. I tend to agree with my hon. Friend the Member for Luton North, in that I would prefer this clause to be removed completely. Failing that, it would preferable to make the amendments.

The Minister touched on the root of the problem with the clause: that the distinction between self-employment and employment has been blurred. The list we have seen is a lawyers’ charter. If this clause is passed, we will see court case after court case for years, to argue about who is on the list, and who is and is not covered.

John Hemming (Liberal Democrat, Birmingham, Yardley)

The hon. Gentleman expects court cases about the uncertainty. Who would initiate those court cases?

John Cryer (Labour, Leyton and Wanstead)

I would expect them to be initiated to some extent by employees who do not know whether they are covered and who would potentially take out cases against their employers.

John Hemming (Liberal Democrat, Birmingham, Yardley)

But this applies only to the self-employed.

John Cryer (Labour, Leyton and Wanstead)

Yes, but they would not know whether they were officially self-employed or not, and would not know whether they were covered or not. That is the problem with the list and the way the clause is drafted. Clause 1 is drafted on the basis of the world of work 30 years ago, when there was a clear distinction between being employed and self-employed. That distinction has become blurred.

Chi Onwurah (Labour, Newcastle upon Tyne Central)

I thank my hon. Friend for giving way and I am sorry to interrupt the excellent point he is making. He is right to make the point about a lawyers’ charter. To offer an example, if a self-employed hairdresser, not subject to health and safety legislation, burns my head with chemicals, I might sue the chemical manufacturer, claiming that the chemical should be covered by the law, or I might sue the trading standards authority for not making it clear whether those chemicals are under the law. Uncertainty opens the way to litigation.

John Cryer (Labour, Leyton and Wanstead)

I agree with my hon. Friend. We have talked a lot about construction this morning, and the section of the list dealing with construction is very vague. What about people working in homes? Are plumbers, carpenters and electricians covered or not? It is not clear, and that is the sort of thing that will lead to problems.

John Hemming (Liberal Democrat, Birmingham, Yardley)

Coming back to the earlier point, if there is uncertainty about whether somebody is employed or self-employed—[ Interruption. ]

Jimmy Hood (Labour, Lanark and Hamilton East)

Order. There is a hum about in the Committee. I said earlier that the most important person is the one who is on their feet addressing the Committee, and if I cannot hear that person, somebody is out of order. There are so many people responsible that I do not want to identify anybody in particular, but I ask the Committee collectively to give attention to the person who is on their feet.

John Hemming (Liberal Democrat, Birmingham, Yardley)

Thank you, Mr Hood. The question whether somebody is employed or self-employed is an issue now, and the clause makes no difference to that.

John Cryer (Labour, Leyton and Wanstead)

Actually, it will make a difference, because that blurring is becoming more and more marked as time goes on. I return to a point I made in an earlier intervention. If an employer transfers the work force to being self-employed, they will lose rights to holiday pay and sick pay, and they will lose their employment rights, so there will be the ability to hire and fire at will. We are constantly seeing new additions to that process, and one of the most recent is the advent of payroll companies. For hon. Members who are not familiar with payroll companies, they take over responsibility for employing people. As a result, the payroll company, rather than those who direct the work force, has a relationship with the work force. The payroll company will say to the employers, “Give us the payroll contract and the work force will lose all employment rights and rights to holiday pay and sick pay.” In some cases, payroll companies even promise that companies will not have to deal with HMRC any more. The practice goes as far as that.

A report on payroll companies was produced a few months ago, which was commissioned by the Union of Construction, Allied Trades and Technicians—I should mention that I am a proud member of UCATT. The author of the report, freelance journalist Jamie Elliott, set up a front company called Fairbrother Builders and approached various payroll companies. Hudson Contract, the biggest payroll company in Britain, made the situation clear in a letter to Mr Elliott:

“We can save you money, 20 per cent of your labour costs, by reclassifying PAYE staff, paying them through CIS.”

For hon. Members who are not familiar with CIS, it is the construction industry scheme for self-employed people. The letter continued:

“Self-employed operatives, paid under CIS deduction through Hudson are not entitled to holiday pay, redundancy or notice. We are helping companies to move their PAYE labour over to CIS…Last year this saved our clients over £25 million in employers’ NIC, placing tax and employment law liabilities with us.”

If the employer goes down that route, the work force will be asked to sign a contract. Some form of compensation is usually paid for the loss of benefits, but it is usually quite a small amount. Once the contract is signed, the employee no longer has a relationship with the original company, despite the fact that the original company still directs operations and is still responsible for what happens in the work place.

Andrew Bridgen (Conservative, North West Leicestershire)

The hon. Gentleman makes an important point. However, with regard to the Bill, it is clear that members of the construction industry will remain under health and safety legislation even if they are self-employed.

John Cryer (Labour, Leyton and Wanstead)

I am grateful to the hon. Gentleman for that intervention, but I am afraid that he is wrong. The definition on the prescribed list is very vague. As I have said, it is not clear when it comes to plumbers, carpenters and electricians. What about a building site with an office and several office staff? They will not be covered by a prescribed list, but they could still be transferred to being self-employed overnight. In some cases, work forces have woken up one morning to discover they are suddenly self-employed. Technically that is illegal, but if someone works for a company that says, “You are now self-employed and there is nothing you can do about it,” are they really going to report that company to the authorities? It has been made absolutely clear what that company thinks of that person and how they will be treated in future.

There are all sorts of other scams that have appeared in recent years, such as offshore companies.

Toby Perkins (Labour, Chesterfield)

I am keen to intervene before my hon. Friend moves on. There is a danger that we focus too much on the kind of workplace. People who work in an office are entitled to be protected under health and safety legislation. People in a variety of office trades are now being asked to go self-employed and invoice the employer, rather than being employed under the traditional working arrangements. They should have the same right to protection, whether the workplace is considered a dangerous place or not.

John Cryer (Labour, Leyton and Wanstead)

I absolutely agree with my hon. Friend. It is an important point that everybody should be covered by health and safety legislation.

I do not want the Committee to get the wrong idea about what I am saying about payroll companies, so I should make the important point that there are perfectly legitimate and respectable payroll companies that do not undertake such scams. Mr Elliott, who wrote the report for UCATT, contacted a number of payroll companies whose response was that the practice was disreputable and that they would not help to transfer people to being self-employed when they are clearly not. At the dodgy end of construction and in other industries, such as catering, hotel management and security—an important industry that employs large numbers of people—this practice of bogus self-employment is increasingly creeping in.

My fear is that we are effectively seeing the abolition of full-time, permanent work in many industries in Britain today. That has the other knock-on effect of creating economic instability and insecurity. People do not have the confidence to spend the money they earn. They worry if they are self-employed, being dealt with by a payroll company, are on zero-hours contracts or are agency workers. They have much less confidence that work will be there tomorrow, next week or next month. Therefore, they do not spend and stimulate the economy, and that is important to all of us on the Committee.

There are other wheezes, which I will not go into now, such as the offshore wheeze. A company called ISS employs 24,000 supply teachers across the UK. Because it is based in the Channel Islands and is a payroll company, it does not have to pay employer’s national insurance. There is a question that has never been quite sorted out: are those teachers self-employed or employed? That has never been settled. Such arguments are becoming more dominant in people’s lives. My worry is that if the Bill is passed in its current form, we will be sitting here in years to come facing other problems in the workplace and saying that the Treasury is losing a lot of money.

I had an Adjournment debate a while ago and the Minister responsible, the hon. Member for East Dunbartonshire (Jo Swinson), admitted that possibly tens of millions of pounds are missing from the Treasury coffers because of bogus self-employment. She admitted that, although I suspect the figure is a lot higher than the Government believe; I do not think the Treasury has accurate figures. I think the problem is lot worse and more widespread, and I suspect that the taxpayer is losing a lot more than the Government are prepared to admit.

There is an argument over the exact figures. Nevertheless, there is an admission on all sides that we are losing an awful lot of money through bogus self-employment. If, as the Bill requires, these people will not be covered by health and safety legislation, there is a further incentive for employers to think it is a great idea to transfer the work force to being self-employed. They would not be covered by health and safety legislation, thus avoiding those problems, as well as other responsibilities such as holiday and sickness pay and the other factors I previously alluded to.

Chris Williamson (Labour, Derby North)

It is a great pleasure to serve under your chairmanship, Mr Hood, for what I believe is the first time. I rise to support the amendments tabled by my hon. Friends, which I am sure is no surprise, and to reinforce some of the comments made by my hon. Friend the Member for Leyton and Wanstead.

I am no longer a member of UCATT, but I was formerly. I remember in the 1970s, before the protection afforded by health and safety legislation, the extremely hazardous circumstances on building sites that I and my fellow workers were subjected to. Indeed, I sustained an industrial accident owing to the poor health and safety provision that pertained to the building sites that I worked on. Thankfully, I am here today to tell the tale, but the injury was severe and the accident could have led to my death. Many colleagues died on construction sites and, even with improved health and safety provisions, many still do.

I get concerned when I see legislation proposed that confuses and undermines the health and safety that is so important to manual workers in particular—although workers in white-collar occupations in offices and so on are just as entitled to such protection, as my hon. Friend the Member for Chesterfield pointed out. They would also be subject to hazard if safety provisions were not in place.

In a former incarnation, I worked as a welfare rights officer and I saw real concerns and problems for people in the situation that my hon. Friend the Member for Leyton and Wanstead suggests will get worse, when they are unsure about their employment status and whether they were employed or self-employed. That makes a real difference, not just in the scams, tax fiddles and so on that take place, but in the risks that people are potentially prepared to take or expected to take. When clients whom I represented sustained an industrial accident, there was an issue about whether they were covered by the industrial injuries provisions, because as self-employed earners they were excluded from certain provisions.

I fear that if we increase the scope of self-employment, that will not be in the interests of ordinary workers on the ground who are forced into an occupation. My hon. Friend the Member for Luton North made that point. We all need to think very carefully before we rip up legislative protections and muddy the water. That will not be in the interests of the people who will be victims of these changes, because their earning potential will be affected, as will their health and safety.

We should also be mindful of the succinct point made about the impact on the Treasury’s tax take. If we see a reduced tax take, that will have a knock-on implication on our ability to ensure good quality public services.

Jimmy Hood (Labour, Lanark and Hamilton East)

I remind the Committee that with this we are discussing amendment 4, in clause 1, page 1, line 10, at end insert—

‘(2A) Regulations resulting from the amendments made by subsection (1)(2) of this Act shall be made by statutory instrument.

(2B) A statutory instrument under subsection (2A) shall be made until—

(a) the Secretary of State has—

(i) consulted with relevant parties; and

(ii) conducted and published a full impact assessment; and

(b) the instrument has been laid in draft and approved by resolution of both Houses of Parliament.

(2C) The Secretary of State shall—

(a) review the definitions of prescribed undertakings specified in regulations resulting from this section annually; and

(b) publicise widely the prescribed undertakings and any subsequent changes made to those regulations.

Chris Williamson (Labour, Derby North)

I think I was coming to a conclusion in my remarks. [Hon. Members: “Aah!”] I know that Members want me to go on for longer, but there might be other opportunities for them to benefit from my oratory skills.

I want to refer to the point made by colleagues on the tax take. Increasing the number of self-employed workers has an impact on the tax take, and that is important for those concerned about ensuring that we have a decent society. Our public services define a decent society. Public services ensure we are cared for when we are old, looked after when we are sick and keep our streets clean, as well as the rest of the gamut of public service activities. If the tax available to sustain those services is impinged on by increasing the number of self-employed workers, that has an impact.

The original purpose behind the health and safety provisions stands today. Muddying the waters in the way that the Government propose takes us backwards, which would be regrettable. Our job in this place is to ensure that we make progress and do not take our country and citizens back to a time when less protection was available to them. For that reason, I will support the amendments tabled by my hon. Friend the Member for Newcastle upon Tyne Central, and I urge colleagues on both sides of the Committee to do the same.

Oliver Heald (Conservative, North East Hertfordshire)

May I start, Mr Hood, by joining the welcome to you as Chairman and saying how delightful it is to be under your tutelage once again? I also welcome the hon. Member for Newcastle upon Tyne Central and her colleagues on the Opposition Front Bench.

Part of the Government’s main policy objective is to reduce the burdens on business to achieve growth. As a number of Members have said, the Health and Safety at Work, etc. Act 1974 is an important milestone in health and safety. Health and safety is important and I do not think anyone on the Committee would disagree with that. There have been considerable achievements, as has been mentioned, not least last year when we saw the Olympic site developed. It was the best health and safety project in Europe at the time.

Kelvin Hopkins (Labour, Luton North)

Will the Minister give way?

Oliver Heald (Conservative, North East Hertfordshire)

In a moment. I will just get started, if I may.

Recent reviews have highlighted that there is a perhaps unjustified fear of health and safety, a fear of being sued and a perception of heath and safety that is unhelpful. Poor health and safety advice is given by badly qualified consultants. That mix is a restraint and burden on business. The Government have acted to try to make improvements to reduce burdens, but we have not done that on the basis of headlines in newspapers or anything like that; we have done it on the basis of rigorous research.

Professor Löfstedt, who has been mentioned already—we have his letter supporting the Government’s approach—is the king of risk management. He is a professor at King’s college London and is highly regarded. When the witnesses gave evidence, they all accepted that he was a top academic in the field. The point that he made in his report was that there is a case for following a similar approach to other countries and for

“exempting from health and safety law those self-employed whose work activities pose no potential risk of harm to others.”

He said that this

“will help reduce the perception that health and safety law is inappropriately applied”.

It is the Government’s case that it is important that this perception should change,

Chris Williamson (Labour, Derby North)

Will the hon. and learned Gentleman give way?

Oliver Heald (Conservative, North East Hertfordshire)

I will give way first to the hon. Member for Luton North, but will make one more point. The Government put forward their proposal to the Joint Committee, which looked at it and felt that it was necessary to define the group that was to be non-exempt or exempt more accurately than had been done in the first attempt. That is why clause 1 is as it is.

Kelvin Hopkins (Labour, Luton North)

The point has passed. It was a small point, but the Minister mentioned the Olympics and the construction work in east London. It contrasts in an extreme way with what has been happening in Qatar, where hundreds of Indian and Nepalese workers have died because they do not have the protections that workers do in Britain.

Oliver Heald (Conservative, North East Hertfordshire)

I think we all agree with that.

Chris Williamson (Labour, Derby North)

On the point that the Minister makes about the perception of health and safety being an impediment and a burden, does he not agree that it is unhelpful for Ministers and Members on the Government Benches to be constantly reinforcing the view that health and safety is in some way excessive and a barrier? It would be incumbent on Ministers to stand up for health and safety. If we give the true picture, maybe the perception could be dealt with through that route, rather than taking the legislative measures that the Minister proposes.

Oliver Heald (Conservative, North East Hertfordshire)

If it is true, as I argue, that there are badly qualified consultants going round giving poor advice in this field and there are a lot of people who are concerned that they might be sued or prosecuted, then surely the hon. Gentleman must accept that if we are to do something about it, taking the advice of a leading figure in the field and exempting people where we can is a sensible thing to do.

Thomas Docherty (Labour, Dunfermline and West Fife)

The Minister is being most generous with his time. Will he clarify a point that we were discussing during our short recess? If a clerical worker who is self-employed works in an office-based job, but the office itself is within, say, the Olympic construction site, a power station or something else, in the Minister’s learned opinion would that self-employed clerical worker be exempt from these regulations or not?

Oliver Heald (Conservative, North East Hertfordshire)

We are trying to exempt people unless they are on the list of activities. If they are on the list of activities then they are not exempt, otherwise they would be if they are self-employed.

Toby Perkins (Labour, Chesterfield)

To clarify what the Minister is saying, if someone performs a task that is not considered dangerous, such as working at a computer on a desk, but they are in an environment that we might consider dangerous, such as a power station or a building site, would they not be covered because the task they are doing is safe?

Oliver Heald (Conservative, North East Hertfordshire)

Clearly, there will be very good consultation in respect of this. [ Interruption. ] No, the point I am making is that the HSE has said it will consult on this. If the hon. Gentleman or anyone else has a particular concern that there is a dangerous situation that needs to be covered, they will have the opportunity to put that forward. That is clear. The other point to make, which is important, is that the HSE has a role in advising business and will issue guidance so that businesses are aware. We had the example of the hairdresser earlier. If a hairdresser looks after and uses chemicals, then that activity is on this list. Certainly as regards the activities of that person, they would have the general duty on them. That is my point.

Several hon. Members rose—

Oliver Heald (Conservative, North East Hertfordshire)

I will give way to my hon. Friend the Member for Macclesfield.

Thomas Docherty (Labour, Dunfermline and West Fife)

Help him out.

David Rutley (Conservative, Macclesfield)

Far from it. I just want to amplify the concerns that the Minister has been addressing. I will never forget the time that I was in Macclesfield, talking to a constituent, who was concerned about excessive regulation giving health and safety a bad name. I asked the person who they worked for and they said, “The Health and Safety Executive.” They were so concerned that excessive regulation was giving their industry a bad name. Does my hon. and learned Friend agree that we have to deal with that perception, and that the steps he is talking about will help tackle that?

Oliver Heald (Conservative, North East Hertfordshire)

That is exactly the point I am trying to make. Reports on health and safety concerns have stated that there is that perception, and that poorly qualified consultants are giving poor advice. The Government are dealing with that. It is a barrier to growth and restraining business. We want business to grow, because we as a country need it.

The Government’s efforts are based on research of an academic kind; they are measured and not based on headlines or anything of that sort.

Toby Perkins (Labour, Chesterfield)

Will the Minister give way?

Oliver Heald (Conservative, North East Hertfordshire)

I just want to make one further point.

In so far as a hairdresser is handling chemicals and storing and using them, they would be covered by this duty, so a hairdresser who does not do that would not be. If people were to work on a construction site, as in the example given by the hon. Member for Dunfermline and West Fife, and not doing construction, and it was no part of their role to do construction in any way—in other words, they are not doing the hazardous activity—they would not be covered, because they are a self-employed person not doing something hazardous.

Thomas Docherty (Labour, Dunfermline and West Fife)

I worked at a nuclear power station for three years. We had lots of self-employed or agency staff working in important clerical roles, but it is common sense that there is a duty regarding behaviours for people next to a nuclear reactor, particularly as it is a busy industrial site. Does not the Minister understand that he is solving a problem without recognising that the location is as important as someone’s specific activity?

Oliver Heald (Conservative, North East Hertfordshire)

Just to be clear, people in the hazardous part of the business environment will obviously be covered because they are in a hazardous situation.

Thomas Docherty rose—

Oliver Heald (Conservative, North East Hertfordshire)

I think the hon. Gentleman is trying to make a point that is really not there.

Thomas Docherty But will the Minister say which bit of a nuclear power station is not hazardous?

Oliver Heald (Conservative, North East Hertfordshire)

I am not suggesting for a minute that there are not parts of a nuclear power station that are. Of course it is a hazardous place. It is on the list. Anyone who works there would be covered, whether they are self-employed or not. My point is that people working on a construction site in an office who are not involved in any hazardous activity and are not in any way involved in it would not be.

Several hon. Members rose—

Oliver Heald (Conservative, North East Hertfordshire)

I shall make a bit of progress. I think that the point is pretty clear.

Clause 1 is currently worded to exempt self-employed people, except those on the prescribed list, and it should exempt approaching 2 million people, but it does not change the law on self-employment in any way. The definitions remain the same. There is no reason to think that it will change employment law at all: it will not.

Of course, the issue raised by the hon. Member for Newham about examples of payroll companies and the like—

John Cryer (Labour, Leyton and Wanstead)

Leyton and Wanstead.

Oliver Heald (Conservative, North East Hertfordshire)

I apologise; I have it written down.

The hon. Gentleman’s example sounded bad, but the Bill would not deal with that in any way. He will know that there is long-standing employment law on this point, and long-standing national insurance law as well, which is dealt with by the Treasury. The leading case in deciding whether somebody is employed or not goes back to 1968. There have been cases that the trade unions and major companies and employees have been involved in for many years.

The current draft prescribed list of undertakings has been compiled to include work activities that have the potential to cause serious harm to others. It includes international health and safety obligations and cases where high numbers of self-employed people are working in areas where there are high injury rates, such as agriculture—that would include a beekeeper, provided he was doing that in the course of a business—and it has all the existing definitions to support it. On this list, where a subject is entitled agriculture, it is defined in accordance with the existing law.

Kelvin Hopkins (Labour, Luton North)

The Minister is drawing distinctions between activities, some being hazardous and others not. It is not necessarily about the activities; it might be the equipment. Office workers have contracted repetitive strain injuries and damage to eyesight from poor screens. In my office we have an electric guillotine that, without a guard, would be extremely dangerous. There all sorts of potential dangers even in an office. It is not the activity; it is the equipment. Electrical equipment always has the potential to inflict shocks. There is especially a problem if children are around. There all sorts of items that could raise dangers even in a self-employed office environment.

Oliver Heald (Conservative, North East Hertfordshire)

Of course, all the duties regarding an employer and employee remain. There is no question of changing those. A self-employed person might possibly have an action in tort if they were injured by other people’s equipment. The point about the Health and Safety at Work, etc. Act 1974 is using the criminal law to enforce a general duty. It has always been seen as a measure to use against serious risk. That approach does not change under the proposals we are making. We are not saying that 2 million people have to look at the risks and consider them in detail when they are in safe occupations.

The Opposition seem basically to agree with that approach, but their amendment suggests that we should prepare and maintain a list of self-employed people undertaking low-risk activities. It would be a time-consuming, enormous task to produce a list of every possible activity that is safe. It would also be pointless, because the evidence base is the other way. The Health and Safety Executive and others have collected information about the hazardous risks we are talking about for years. To compile a list of occupations that have risks is a much more straightforward, simple and sensible thing to do than to try and produce a list of what is safe, which would be massive.

Chi Onwurah (Labour, Newcastle upon Tyne Central)

The Minister must have a vivid imagination if he believes we share a common approach. We share a common desire to improve regulation and reduce burdens, but our amendment is to clarify and address the issue of perception, rather than to remove legislation for health and safety.

Oliver Heald (Conservative, North East Hertfordshire)

The hon. Lady’s amendment proposes that the Health and Safety Executive should prepare and maintain a list of self-employed people undertaking low-risk activities. That would be an enormous task and create confusion. It would be a less satisfactory way of doing what the Government are trying to do, which is to create a simple, clear way of allowing people to see whether they are covered or not.

Toby Perkins (Labour, Chesterfield)

The hon. and learned Gentleman says that the amendment would cause confusion. He is proposing legislation specifically naming what is dangerous. Hairdressers who use dyes are on the list; those who just clip hair are not. Someone who has to walk across a building site every day but is working on a computer is not on the list. The idea that what he is talking about here is simplifying the situation is ludicrous.

Oliver Heald (Conservative, North East Hertfordshire)

To put it the other way, on the hon. Gentleman’s list would be hairdresser, non-use of chemicals, and clerical worker, not working in construction. There is no difference; it is just that his list—[ Interruption. ] I do not know: 10 times as long. It would be an enormous list trying to include every safe occupation. It would be a genuine lawyers’ feast. The most important point is that we had the benefit of pre-legislative scrutiny on this Bill, and those who scrutinised it said that they wanted it to be easier to understand who was and who was not exempt. They were in favour of exemption but they wanted it to be clearer. It is much simpler to do that by providing a short-ish list of the hazardous occupations than by providing an enormous list of safe occupations. Also, the evidence base is of what the hazards are; it is not of what is safe.

John Cryer (Labour, Leyton and Wanstead)

I think I am right in thinking that the Minister said earlier that the list would be subject to a Health and Safety Executive consultation, but we are now at Committee stage and presumably Royal Assent is not that far away. How will that fit in with the consultation, because the Health and Safety Executive—which has been cut, so it has fewer resources—must hold a consultation, wait for the responses, then contribute to the Bill. Will the Bill be issued with the list, or will that come later?

Oliver Heald (Conservative, North East Hertfordshire)

The idea is that the regulations should be in place at the time when this is implemented; otherwise, it could not be implemented. So the idea is to implement the clause when the regulations are in place.

John Cryer (Labour, Leyton and Wanstead)

The list?

Oliver Heald (Conservative, North East Hertfordshire)

The list would be in regulations.

Jimmy Hood (Labour, Lanark and Hamilton East)

Order. I am trying to be helpful. Hon. Members were asking earlier whether we would have a stand part debate. If they will not allow the Minister to get through his response without a huge number of interventions, which will cover part of what would be expected to be in the stand part debate, hon. Members may be talking themselves out of having a stand part debate. So I would hope that interventions are to the point, as has been previously raised, and that they would be short interventions and not contributions to a debate.

Oliver Heald (Conservative, North East Hertfordshire)

It may help the hon. Member for Leyton and Wanstead if I finish my remarks anyway, because I deal with a lot of these points.

The current drafting of clause 1 and the existing statutory framework within the Health and Safety at Work, etc. Act 1974 does achieve a number of aspects that amendment 4 purports to introduce. Clause 1 limits the duty in section 3(2) of the 1974 Act to undertakings “of a prescribed description”. “Prescribed” is already defined in the 1974 Act to mean prescribed by regulations made by the Secretary of State. It is not necessary, therefore—I do not know whether this will help—to specify in the clause that regulations need to be made by statutory instrument. That is already there in the 1974 Act.

The amendment seeks to impose a statutory obligation on the Secretary of State to consult with relevant parties and to conduct and publish a full impact assessment. The new regulation-making power created in subsection (2) is a relevant statutory provision, and as such it already falls subject to the statutory duty to consult in section 50 of the 1974 Act, so consultation is there already as well. There is no need to repeat that in a separate amendment, and the Government will comply with the requirements to produce and publish an impact assessment alongside any new regulations, which they always do. The existing statutory framework in the 1974 Act does not provide for the new regulation-making power to be subject to affirmative resolution procedure, because the increase of parliamentary time that that would require is not considered appropriate, and normally the affirmative procedure is kept for cases where primary legislation is being changed by secondary legislation. But the option would be available to pray against the regulations if there was concern, and of course the business managers would then wish to ensure that there was a debate.

Chi Onwurah (Labour, Newcastle upon Tyne Central)

Just to clarify, is the Minister saying that a full impact assessment regarding that list will be published, which will identify, for example, the impact on hairdressers and nuclear workers of that list?

Oliver Heald (Conservative, North East Hertfordshire)

It will set out, in the normal way, all the impacts that the Government are required to set out under their policy and guidance on this. Certainly if, in the course of the consultation, the hon. Lady or other people raise concerns, they will be considered, as they should be.

Most of what the hon. Lady is proposing in amendment 4 is already covered by existing law. It is worth noting that the Delegated Powers and Regulatory Reform Committee looked at the clause and did not consider the affirmative resolution procedure to be appropriate, although it would normally say so if it thought that that would be right.

Finally, the need to ensure that new regulations are regularly reviewed is accepted under the Government’s better regulation agenda. Amendment 4 would impose a statutory obligation to review the regulations annually, which is over-burdensome. Our intention, however, is that any new regulations made under the power will contain a duty for the Secretary of State to review them every five years. That complies with the Government’s better regulation guidance. The Health and Safety Executive will produce guidance on its website to ensure that the legislative change is properly understood by those affected. It will also ensure that clear guidance, with examples, is available to the self-employed engaged in high and low-risk activities.

On that basis, I hope that the amendment will be withdrawn.

Chi Onwurah (Labour, Newcastle upon Tyne Central)

The debate has realised my expectations with regard to the expertise of Members, as well as their interest in—and at times excitement about—the subjects we are considering.

The hon. Member for Birmingham, Yardley made a considered contribution based on his experience. My hon. Friend the Member for Luton North made a number of excellent points about the importance of health and safety. My hon. Friend the Member for Leyton and Wanstead described the clause without our amendment as a lawyers’ charter and emphasised the point about increasing bogus self-employment, which I did not feel able to mention enough in my remarks. My hon. Friend the Member for Derby North talked about his own experience of industrial accidents, again emphasising the importance of what we are discussing and in particular why we must retain our strong health and safety requirements while addressing perceptions as necessary.

A number of my hon. Friends wished to vote against the clause in its entirety, although they expressed their support for amendments 3 and 4. I understand their wish and considered long and hard before tabling the amendments. My hon. Friends may say that I am being idealistic or naive, but I wanted to be in Committee with a shared desire to address true underlying concerns about the perception that health and safety represents a burden, while maintaining the strength of our existing health and safety legislation.

I thank the Minister for his response. He gave some clarity about the impact assessment at least, if not the timing, so I still find myself confused.

Toby Perkins (Labour, Chesterfield)

The Minister’s speech was similar to an organic process: we could see the Bill evolving and changing in intent before our very eyes. The idea that what has been presented will in some way offer certainty to people about whether they are included is so obviously wrong.

Chi Onwurah (Labour, Newcastle upon Tyne Central)

My hon. Friend accurately, if perhaps a little harshly, describes my sense of remaining confusion, which many will unfortunately share.

Oliver Heald (Conservative, North East Hertfordshire)

The hon. Lady expressed concern about the timing. The impact assessment would be published when the regulations were before the House. The aim is for the whole legislative package, including the regulations, to be in place by the time of Royal Assent.

Chi Onwurah (Labour, Newcastle upon Tyne Central)

Although that is a clarification, I truly do not understand how we are expected to give the Bill full scrutiny when we have no assessment of its impact in so many different areas. I look forward to an explanation that would clarify, for example, what would happen if my hon. Friend the Member for Dunfermline and West Fife was working in a clerical role in a nuclear station and was visited by a hairdresser who had chemicals. Would the hairdresser be subject to health and safety legislation while my hon. Friend, who might have access to the nuclear power station’s entire IT system, would not be?

Andrew Bridgen (Conservative, North West Leicestershire)

Were the Opposition not comforted and reassured when they received Professor Löfstedt’s worthy letter, which deals with some of those concerns, at lunchtime today?

Chi Onwurah (Labour, Newcastle upon Tyne Central)

I am conscious of your guidance about the stand part debate, Mr Hood, but I will briefly respond to that point. I have read Professor Löfstedt’s letter, but it is an academic clarification in the truest sense of the word. Although Professor Löfstedt says that he asked for action to be taken, he says:

“I believe this position was consistent with the spirit of my recommendation.”

I would not call that a ringing endorsement of the provisions.

Oliver Heald (Conservative, North East Hertfordshire)

It is better than “I disagree.”

Chi Onwurah (Labour, Newcastle upon Tyne Central)

It is, but it is still not a ringing endorsement. Amendment 4 is simply a probing amendment. Amendment 3 is designed to address the Minister’s concern about perception, which we share, without undermining the critical health and safety legislation that self-employed people deserve as much as others do. I want to press amendment 3 to a vote, and I hope the Minister and others will join us in voting for it.

Oliver Heald (Conservative, North East Hertfordshire)

I beg to move amendment 2, in clause 1, page 1, line 11, leave out from ‘Executive)’ to end of line 12 and insert ‘after subsection (4A) insert—

‘(4AA) Subsection (4)(b)(i) does not apply in relation to the making of regulations under section 3(2) for the railway safety purposes (and, accordingly, the Executive shall submit under subsection (3) such proposals as the Executive considers appropriate for the making of regulations under section 3(2) for those purposes).”.’

Chi Onwurah (Labour, Newcastle upon Tyne Central)

It is a great shame that the Committee chose to reject our amendment 3. As it stands, the clause is an ideological change to a law that has existed for 40 years and saved many lives. I must confess that I am experiencing déjà vu because, as I have said, the last Bill Committee on which I served considered the Enterprise and Regulatory Reform Bill. It, too, was full of attacks and policies based on anecdote, and here we are again. The Government have given up even pretending to tackle issues that matter to small businesses and ordinary people, such as access to finance and energy prices. Instead, they are taking up the case of the oppressed novelist tied up in red tape—the dead hand of the state stopping him finishing that book while he produces an impact assessment of health and safety on his work.

This week, I read a Cabinet Office report of 2013, entitled “When Laws Become Too Complex”. It was mentioned in evidence to the Committee this week and I recommend it. It quotes Edward VI:

“I wish that the superfluous and tedious statutes were brought into one sum together, and made more plain and short.”

The truth is that the Health and Safety at Work Act, etc. 1974 brought together myriad statutes into one simple and easy to understand one. The Cabinet Office has a good law initiative whereby laws should be

“necessary, effective, clear, accessible and coherent”.

The 1974 Act is all of those things, but we have seen in the debate on a small number of activities and occupations that this clause is ineffective and confusing.

I challenge Government Members to produce one piece of evidence or a witness who can demonstrate with proof, rather than anecdote, that the clause will be effective. I also challenge them to convince us that they have thought through all the possible unintended consequences. It is clear from the debate that they have not thought through even a small number of the possible consequences.

I will not again raise the vision of the hairdresser visiting the nuclear power station, but let me present one scenario in a little detail. Let us suppose there is a worker in a call centre in Newcastle—which is an excellent location for call centres and, indeed, all support services. Their employer tells them that, rather than having an employment contract with a salary, they will now be a self-employed service agent. That happens all too often; remaining levels of unemployment in my constituency and elsewhere across the country mean that many workers find themselves persuaded, shall we say, into unwanted self-employment.

The worker is still doing exactly the same job. They turn up at their employer’s premises, but they are no longer covered by health and safety legislation. The employer is no longer officially an employer, because there is merely a service contract. What happens if the worker overbalances on their badly designed chair or knocks a potted plant on their neighbour’s head? As my hon. Friend the Member for Leyton and Wanstead said, this clause is a lawyers’ charter. Who is to take responsibility? Is that not simply introducing more and more confusion, and for what? It is 37p per self-employed person; 4p per year is probably close to the mark.

Far from improving perceptions of the law, this clause causes confusion. If Ministers want to improve the perception of health and safety, they should support health and safety and champion how it can improve lives. They should tell stories like the one my hon. Friend the Member for Luton North told about health and safety saving lives in this country over decades, and about disregard for health and safety still causing fatalities in many places around the world.

I challenge Ministers again to show real evidence—not what a friend told them, or what somebody mentioned in a pub—that the law is currently being applied inappropriately or that it is stifling enterprise or holding back our economy in any way. If they cannot produce that evidence—Professor Löfstedt’s most recent evidence is clarificatory, not new—this is bad law. I would argue that, contrary to being bad for business, the Health and Safety at Work, etc. Act 1974 has made our economy more competitive over the past four decades. Safe, secure employees are more productive employees. Safe and healthy workplaces are more productive workplaces. That is the case regardless of the size of the business. Health and safety is a crucial part of good management and long-term planning.

On long-term planning, there is another area of unforeseen consequences on which the Government have failed to deliver any evidence: occupations that may arise in the future. We live in a rapidly changing environment, in a time when technology is changing our lifestyles, our working environments and our jobs. How will this legislation react to new activities and new jobs in which self-employed persons may pose risks to others?

I want to quote a woman who works for the European Union and health and safety organisations—Conservative Members may not wish to listen. Ms Christa Sedlatschek, director of the European Agency for Safety and Health at Work, said last month that a Europe-wide survey of more than 36,000 businesses found that

“it is not the perceived cost or complexity of health and safety legislation that prevents some workplaces from taking preventive action, but rather a lack of awareness about relevant workplace risks.”

I suggest to the Minister and Government Members that the clause will only reduce awareness of risk among self-employed people and small businesses.

Our work force is ageing, in particular the proportion of those going into self-employment since 2008—I think 60% were over the age of 50. In general, the workplace is ageing, as older people increasingly stay on in work, as well as starting their own businesses, and they will be more susceptible to risks at work—not only falling off a ladder, but a bad back, stress and other conditions that are becoming more commonplace. In future, we need to be more aware of risk, not less. The argument is economic, as well as about health and safety. Members should also consider the human argument: no cost can be placed on human life, injury or suffering.

If it is not apparent by now, our intention is to vote against the clause standing part of the Bill, in summary for the following reasons. We have seen no rigorous evidence to support any of the benefits that the clause is supposed to bring at any stage. It will have negligible benefit to small business and self-employed people, at the cost of creating confusion for millions of self-employed people in a variety of sectors and dangerous occupations. Furthermore, the clause contributes to a narrative that health and safety is inherently a bad thing, rather than something that can make our economy more competitive and a safer place to work. I sincerely hope that Government Members will look seriously at the clause and not choose ideology and partisanship over something that could cost some people very dear.

Kelvin Hopkins (Labour, Luton North)

It was remiss of me earlier not to welcome you to the Chair, Mr Hood, and to say what a pleasure it is to serve under your chairmanship, but I was caught slightly unawares this morning. It is a genuine pleasure. I want to support strongly everything that my hon. Friend has said from the Front Bench and to make one more point, which she hinted at in her speech.

Health and safety legislation is not only about restricting people or making them do things, but about a culture in which we all become conscious of dangers in what we do in our daily lives, at work and outside work. Unfortunately, I was not so sensible myself and slipped on an oil patch—it was nothing to do with work—but I am now much more conscious of the fact that there are dangers. We all become conscious of dangers.

In other areas of life, too, we have become more conscious of dangers, such as wearing seat belts in cars. That was introduced as voluntary, but people did not wear them; once we had to wear seat belts, we became conscious of the dangers in driving and of what can happen with forces of deceleration on the human body when it hits something hard.

Legislation can often change cultures. It can change attitudes, making us more aware. That is what health and safety legislation does, and cutting back on it will have little economic impact. It could be argued that it will have a damaging economic and social impact. Appearing to window-dress for the sake of prejudice outside this place—that health and safety is somehow a bad thing—is a retrograde step and not one that we should welcome. We should be standing up for health and safety and saying that the existing law is the least we should have. The fact that our health and safety law is stronger than that on the continent of Europe is a matter of pride, as well as of common sense. We ought to vote down the clause.

Toby Perkins (Labour, Chesterfield)

I want to add to my hon. Friend’s point and one made earlier about the comparison of what happens in Britain with what happens in some countries overseas. One point that has not been made is that in Germany it is much more difficult to set up a company than it is in the UK. One strength of the UK economy is that it is easy to set up a company and to become self-employed. In Germany, it is much more complicated to set up a company and the way that a company is constituted is very different. For that reason, using Germany as an example is different, because companies that employ people in Germany are different.

Kelvin Hopkins (Labour, Luton North)

I thank my hon. Friend for making a strong point. The extent of self-employment in Britain is vast, so restricting the application of health and safety legislation to the self-employed is much more serious here than it might be overseas.

I have made the points I want to make; we should vote the clause down. We ought to persuade the Government that they should be standing up for health and safety. They should be saying that the kind of prejudices that float in some sections of the media are utterly misguided, and that Members from across the whole House should stand up for health and safety and express pride in the impact that it has had on our society over the past 40 years and that it will continue to have in future. I therefore support my hon. Friend the Member for Newcastle upon Tyne Central.

Oliver Heald (Conservative, North East Hertfordshire)

We have had a short but none the less interesting debate. The Government’s point is not that there is anything wrong with having good quality laws to enforce health and safety and using the criminal law as we do, but that we should not use the law as a restraint on growth when it is not necessary. Professor Löfstedt made that point in his excellent report. It is nonsense to say that there is no evidence, when he had a commission, which included my hon. Friend the Member for North West Leicestershire and other experts from across industry. The report makes the point, which I was making earlier, that there is a problem in Britain and concern that health and safety is being applied unnecessarily in some cases, and that there is influence from third parties, who are promoting the generation of unnecessary paperwork, focusing on health and safety activities that go beyond what is required.

Chi Onwurah (Labour, Newcastle upon Tyne Central)

I just want to clarify that when Opposition members of the Committee ask for evidence, we are asking not for evidence about an issue with perception—which the Minister is right to say that Löfstedt speaks to—but for evidence and documented examples of issues with health and safety.

Oliver Heald (Conservative, North East Hertfordshire)

The hon. Lady is perhaps missing the point. There are business people throughout the country and those who want to set up in business, and we do not want to restrain their activities unnecessarily. We want them to go out, set up business and grow. We do not want barriers to growth.

Thomas Docherty rose—

Oliver Heald (Conservative, North East Hertfordshire)

Let me just finish the point. Perception is a barrier to growth. We can exempt 2 million people from legislation because they are in safe occupations. They will all be saved from having to do risk assessments, at 15 minutes a person according to one estimate. However, it is not so much the money, as the barrier that the perception creates that is the problem.

The hon. Lady says there was no support for the measure. When the British Chambers of Commerce gave evidence, it supported it. The business organisations support it, because they understand that we have to see whether we can remove barriers to growth and to enterprise. Yes, we are a safe country, and that is a good thing. No one is trying to change that. The difference between the hon. Lady and me is that she wanted a safe list of occupations, whereas I am arguing that there should be a list of high-risk occupations, because that is a simpler way of effecting what Löfstedt says.

Tom Brake (Liberal Democrat, Carshalton and Wallington)

It is much more focused.

Oliver Heald (Conservative, North East Hertfordshire)

It is indeed a more focused approach, as my right hon. Friend says from a sedentary position, because it is based on evidence accumulated over the years about what is and is not hazardous.

Chi Onwurah (Labour, Newcastle upon Tyne Central)

I thank the Minister for giving way and enabling me to correct, again, his assertion that the only difference between us is the nature of the list. I want the legislation to remain and to support more publicity about what occupations are not risky. He wants to take away the legislative protection of many self-employed people and put a list in its place.

Oliver Heald (Conservative, North East Hertfordshire)

The hon. Lady cannot get away with that. Her amendment 3 said there should be a list of safe occupations and that the people on it would no longer be subject to the law. She cannot now be saying, “Oh, we put that down and if it had been passed, we would still have voted against the clause.”

Chi Onwurah (Labour, Newcastle upon Tyne Central)

That is not what I was saying. I am not sure that the Minister has fully read my amendment, because it would have removed the subsections that remove self-employed people from health and safety legislation. With my amendment 3, the legislation would have remained as it is under the Health and Safety at Work, etc. Act 1974. In addition, there would have been a list that helped those who are self-employed to understand what limited risks they faced.

Oliver Heald (Conservative, North East Hertfordshire)

Well, either way I am glad we opposed amendment 3. I would just say to the hon. Lady that if that is what she intended, so be it.

Toby Perkins (Labour, Chesterfield)

Will the Minister give way?

Oliver Heald (Conservative, North East Hertfordshire)

No.

Toby Perkins (Labour, Chesterfield)

It is a small point.

Oliver Heald (Conservative, North East Hertfordshire)

I will continue for a moment.

The point is that Professor Löfstedt, who is the leading expert in the field, supported by those in the business world who know about these things, says that people in low-risk activities should not face inspection or have to do risk assessments when they are unnecessary. To have that in the law is bad for the perception, which is a restraint on business and growth. The point Professor Löfstedt makes in his letter, which amplifies what is in his report, is this. Why should somebody in a clerical job—a software developer or writer; people like that—have to go through this process? Why should they have to worry about this? We are talking about 2 million people being required to waste their time and put in fear. [Interruption.]

Jimmy Hood (Labour, Lanark and Hamilton East)

Order. I said at the beginning of the Committee this morning that I did not want chatter between the Front Benches. A lot of restraint would be helpful at this stage.

Oliver Heald (Conservative, North East Hertfordshire)

I think we have had a good debate; I am not sure whether the hon. Member for Chesterfield has a further point to make.

Toby Perkins (Labour, Chesterfield)

The Minister says that this is not so much about that issue, but all about the perception. If he were in charge of the Home Office, rather than in his Department, and a rumour swept the town that a moose with the mouth of a tiger was marching up and down the side of the river, then rather than a make a public information announcement that there was no moose with the mouth of a tiger, he would be bringing in a force to kill the moose with the mouth of a tiger. He is dealing with perception. What he should be doing is telling businesses out there about the sensible policies on health and safety, rather than changing the law in a dangerous way in order to deal with a perception that does not legally exist.

Oliver Heald (Conservative, North East Hertfordshire)

The hon. Gentleman makes a point that I do not think stands scrutiny. He admits that imposing a burden on 2 million people is unnecessary, because he admits that there is very little that they should have to do to tackle health and safety concerns because they are in low-risk occupations. What is the point of that? It gives an opportunity to the consultants to go in and give them poor quality advice of the sort that Professor Löfstedt talks about. Perhaps it creates a bit of business for them, but it does not do anything for the reputation of health and safety, which is something that needs protecting, as other hon. Members have said. I do not think there is much more that I can add, but I commend the clause to the Committee.

Clause 2 - Removal of employment tribunals’ power to make wider recommendations

Oliver Heald (Conservative, North East Hertfordshire)

Clause 2 would remove the power given to employment tribunals in the Equality Act 2010 to make wider recommendations to employers who have lost a discrimination case. When introduced, those wider recommendations were intended to benefit the wider work force in cases where the claimant had already left the employer’s employment. However, the Government have found the power to be unnecessary, to generate cost and confusion and to have no known effect in ensuring that employers do not breach equality law again.

Most of the recommendations made by tribunals since 2010 are generic and related to process. We believe that since then, 30 tribunals have chosen to make wider recommendations. About 85% of those concern training for management or updating company diversity policies. Common sense and business sense mean that employers who lose a discrimination case will often take additional actions voluntarily. They do so in the interest of avoiding similar cases being brought against them in the future.

The Government have been working proactively with business through their Equalities Office to improve compliance with the Equality Act. In 2012-13, the Government Equalities Office partnered the British Chambers of Commerce in events across the country, explaining the Act to small business. About 300 businesses attended the events and a follow-up booklet, “Business is Good for Equality”, was more widely distributed by regional chambers to their members, which together, employ more than 5 million people.

The director general of the British Chambers of Commerce wrote in the booklet’s foreword that the popularity of the events is

“proof of just how much business people appreciate the opportunity to meet government face-to-face to discuss their challenges and successes. I hope that other departments can learn from this partnership between the Government Equalities Office and the Chambers of Commerce Network”.

I should point out that even the figure of 300 businesses that attended the events to learn at first hand about their obligations under equality law is 10 times the number of employers who have received a wider recommendation in the past three years. Moreover, the power is, in practice, discretionary. It has no legal sanctions to ensure that a recommendation is carried out. The tribunal has no power to force a non-compliant employer to carry out the recommendations. In practice, tribunals are left trying to set deadlines or seek confirmation of compliance, but it is completely understandable that some employers are just confused about the nature and extent of the requirement itself.

Some hon. Members have expressed concern that repeal will reduce protections against discrimination in the workplace, but I assure them that that is not the Government’s intention, it will not be the result, and the repeal does not reduce the rights of complainers. Tribunals continue to have the power to make recommendations. The repeal does not reduce the rights of other employees in the business, as the wider recommendation is unenforceable. If an employer fails to act after losing a tribunal case and a further successful complaint is made against them, a tribunal is entitled to take the previous judgment into account anyway. That can even lead to greater sanctions being imposed by a tribunal if the previous behaviour is relevant.

We consider that that is an appropriate approach to encourage the small number of non-compliant employers to change their practices. Some commentators, including some hon. Members, have suggested that employers want tribunals to have the power to guide them in improving their workplace practices, but we have listened to business and heard evidence that they do not agree. Business representatives, the Institute of Directors, the British Chambers of Commerce and the Federation of Small Businesses support the repeal. They tell us that the wider recommendations power causes burdens to business through uncertainty, risk and cost.

The point was made that an employer, when deciding whether to contest a case, may feel that they have a strong case but worry about the burden and that may affect their decision. Such burdens fall disproportionately on small businesses and affect their ability to operate competitively.

This modest change will take away some of the uncertainty, risk and cost and ensure that when an employer responds to the wider implications of a judgment against them, they are free to act as they—and not just the employment tribunal—judge to be in the best interests of their business. That, in turn, will help small businesses to grow, take on more staff and aid the recovery.

Kelvin Hopkins (Labour, Luton North)

I strongly oppose the clause. In one of our sittings on Tuesday, I said that I had chaired a group of Members that was established to campaign against what the Government are doing in weakening tribunals. Tribunals should be a fundamental human right and any weakening of them is very serious. This is a relatively minor part of a tribunal’s powers.

Oliver Heald (Conservative, North East Hertfordshire)

The hon. Gentleman knows that thousands of cases every year deal with discrimination, yet in the more than three years since 2010, the power has been used in only 30. That shows that this is not a power that the tribunals are even using.

Kelvin Hopkins (Labour, Luton North)

The Minister mentions that only a few have been brought forward. Why, then, bother removing the power in any case?

Thomas Docherty rose—

Kelvin Hopkins (Labour, Luton North)

I will just answer the point. The power is there if the tribunals wish to use it and, where they have, I am sure that it has had a beneficial effect.

Thomas Docherty (Labour, Dunfermline and West Fife)

The Minister made our point for us: this power is used sparingly as it is. Does my hon. Friend agree that it is not a cumbersome burden on business?

Kelvin Hopkins (Labour, Luton North)

My hon. Friend is absolutely right. I know of tribunal cases, people who have sat on tribunals and those who have gone to tribunal—indeed, some hon. Members, shamefully, have had tribunals against them. For a tribunal to have the power available to make a general recommendation that is not enforced or an obligation to wise up the employer so that they will not make similar mistakes in future must be elementary common sense, even if it is not widely used.

Once a tribunal case has found against them, most employers will mend their ways, but some may need a little more pressure or encouragement to do the right thing in future and not cause distress to those who have suffered from wrongful dismissal or whatever. That would also benefit their company in future; it would mean that they did not make the same mistake again and incur all the costs involved in defending themselves in another tribunal case.

It is perfectly sensible to keep the power in the law as it stands. It may not be used widely, but it costs little and when it is used I am sure that it is beneficial.

Toby Perkins (Labour, Chesterfield)

I agree with my hon. Friend in many ways. As a former self-employed business owner, I know that no one goes into business because they want to spend more time with their bureaucracy and everyone wants less regulation. Many businesses across the land will have been quite excited or even rejoicing when they heard that, after 13 years of talking in opposition and almost four years in government, the Government were finally bringing forward a Deregulation Bill. Sadly, the Bill’s name is one of its best parts. We will support many clauses in the Bill, but, frankly, they are hardly game-changing.

Much of the Bill includes measures that will make little or no difference and some of it is not deregulatory at all—some of it will cost business money. Overall, the Government’s estimate of the savings for business in the Bill will be less significant than if they had simply sent every British business a single second-class stamp every year. That is the full extent of the money being saved by business under the Bill.

Clause 2 would remove employment tribunals’ power to make wider recommendations in discrimination cases that affect employers’ dealings with persons other than the claimant. Before looking at why the power is being abolished, there is value in looking at why the power existed. I went back to the Bill Committee for the 2010 legislation to learn about what Members were saying at that time. It was a very different Conservative party in those days. They were still in their “hug a hoodie, try to pretend to be reasonable” stage—very different from today.

The hon. Member for Weston-super-Mare (John Penrose) tabled a couple of amendments and made it very clear that he supported the intentions of the proposal. However, there was something he was worried about:

“I am sure that all members of the Committee would agree that it may be necessary, when a finding has been made that an organisation has been behaving in an illegal fashion, for that organisation to clean up its act and to change what it is doing.”

He questioned whether the power would be used far too widely and whether the steps would be binding or mandatory. He questioned whether the impact on business would be significant. He received a reply from the Solicitor-General of the time, who told him:

“The key is that any recommendations made to benefit the broader work force and indeed the business would have to be proportionate to the case that is brought, otherwise it would be unlawful.”

He was also told some of the typical recommendations that the then Solicitor-General anticipated the tribunal making.

“Some typical recommendations that might help include taking steps to implement a harassment policy more effectively; providing equal opportunities training for staff involved in promotion procedures; and introducing more transparent selection criteria in recruitment transfer or promotion processes.”

In fact, that is precisely the kind of recommendation that has ended up being made. The then Solicitor-General went on to say:

“It is a pretty simple, logical follow-on to a finding in a tribunal that there is a problem and a recommendation on how best to put it right.” ––[Official Report, Equality Public Bill Committee, 25 June 2009; c. 511-513.]

It was there to support businesses. Having listened to those assurances, the hon. Member for Weston-super-Mare withdrew the amendment and supported the proposal.

The Conservative party of the time—very different from today’s—having scrutinised the intentions of the Bill, recognised that it was positive and supported it. It now turns out that precisely what the then Solicitor-General said would happen has happened. It has been used sparingly and been relatively modest in terms of what was expected. In fact, we have something that was supported by the Conservatives and that has delivered exactly what they supported back then.

Now, with this very different Conservative party, it is no longer acceptable. That is very revealing about the state of politics in this country. It also shows that we have a Government who have run out of ideas for useful things to do and are simply trying to deal with perceptions in the business community rather than take action about existing problems.

I have spoken about what the Conservative party said, but what the Liberal Democrats said at the time was even stronger. I particularly enjoyed what the hon. Member for Hornsey and Wood Green (Lynne Featherstone) had to say; I think colleagues might enjoy this.

“The passion that drives and motivates Liberal Democrats—that beats in our hearts—is our quest for, and commitment to, a fairer and more open and equal world.”

That sounds wonderful. That was what the Liberal Democrats believed then. She went on to say that her only objection to the proposed legislation was that the Government could have taken a more radical perspective. She wanted to see them go further. That is where the Liberal Democrats were in those days. I heard some of them myself. She wanted guarantees that were

“radical and would give us a constitutional right to fairness”.—[Official Report, 11 May 2009; Vol. 492, c. 577-8.]

That is what the Liberal Democrats were saying when we brought this legislation in. We now have a Liberal Democrat Member who, far from calling for it to be more radical, says that this very proportionate and sensible legislation should be got rid of.

Kelvin Hopkins (Labour, Luton North)

The word “flexibility” is used frequently in politics these days as a good thing. It seems that the Liberal Democrats are almost infinitely flexible. Are the Conservatives fond of their flexible friends?

Toby Perkins (Labour, Chesterfield)

According to The Daily Telegraph , not so much any more, but we will see how that pans out.

Let us suppose for a minute that the situation was different. Let us suppose that instead of tribunals making just 30 recommendations and taking a very measured and proportionate approach, they had gone wild and made wider recommendations all over the place, causing huge problems to businesses. Then we would be debating something that businesses across the country were very concerned about and, if we follow what the Minister has said to its logical conclusion, he would have been much happier, because there would have been loads of recommendations. He would have been able to say, “This is a really important power that is being used on a huge scale.” In fact, because tribunals have done exactly what the previous Solicitor-General said and used the power proportionately and moderately, he now says, “Let’s get rid of it.” That does not seem to make much sense.

The Government held a consultation on removing the power to make wider recommendations. They received 157 responses: 12% were in favour and 79% were against. When the Government do a consultation and 79% of responses say, “You’ve got it wrong,” but they say, “We’re going to do it anyway,” people are bound to say, “What was the point of the consultation in the first place?”

We need to recognise this power in its context. Many of us have, in different ways, been aware of and perhaps had some experience of employment tribunals. The hon. Member for North West Leicestershire said tantalisingly in one of the sittings on Tuesday that he had been to a few in the past. He did not expand—perhaps he would like to—on whether that was in his role as an employer, whether he was a wronged employee or whether he is just one of those people who likes to go and watch employment tribunals.

Andrew Bridgen (Conservative, North West Leicestershire)

I think I have probably attended five tribunals in 25 years as an employer employing up to 250 staff and, from memory, I think that I won four of the five cases.

Toby Perkins (Labour, Chesterfield)

So it was as an employer. I am glad that the hon. Gentleman was able to update us on that. I have not, I am happy to say, been to an employment tribunal myself, but my background is relevant. Hon. Members may be aware that I had my own business for five years before coming to this place, but before that, I worked as a manager at a recruitment firm and I had a number of staff—although nothing like as many as the hon. Gentleman—working for me across five branches. In the course of five or six years, in what was a very high-turnover environment, a number of people who came to work for us subsequently were not able to do the job and ended up moving on, but the way in which the process was handled meant that we did not end up at a tribunal.

We all recognise that sometimes we have employees who cannot do the job that we have taken them on to do and they have to be dismissed, but the fact that that happens does not logically mean—I want to clarify that I am not in any way casting aspersions about the kind of employer that the hon. Gentleman is—that it is inevitable that we end up in front of a tribunal. I was in a business that had a lot of staff turnover. None the less, such situations were managed in a way that did not involve us having to keep going to tribunals.

None of this is to say that there are no employers who have had bad experiences with a tribunal. I know, from a huge series of business consultation visits that I and other members of the Labour party business team have been doing up and down the country, that the issue of tribunals exercises some employers. It is unsatisfactory that employers sometimes feel—the Minister referred to this—that they have a case, but they are nervous about defending themselves, either because of the costs, even though they think that they are right, or because of the reputational risk.

Andrew Bridgen (Conservative, North West Leicestershire)

I will give an example. A constituent came to me. They had a very small business, employing seven or eight people, and they were involved in an employment tribunal. The aggrieved employee demanded that all the employees of the business be there for a three-day tribunal. The business owners had no choice but to settle, because they would not have had a business if they had had to send everyone to a tribunal for three days.

Toby Perkins (Labour, Chesterfield)

I absolutely recognise that, but the clause would not have helped that business in any way whatsoever. That is the important point. There are some difficult issues to solve with tribunals. I recognise that those issues exist and that the process leaves some businesses feeling bitter. They mention the cost and so on, but no businesses have said to me that the issue is the wider recommendations. That never came up.

Oliver Heald (Conservative, North East Hertfordshire)

But it is the case that the British Chambers of Commerce, which meets more businesses than the hon. Gentleman or me, said that the wider recommendations power was a concern for employers in deciding whether to contest a case. If it is concerned, we should take account of that.

Toby Perkins (Labour, Chesterfield)

I certainly think we should take what the British Chambers of Commerce says seriously. Those who read the evidence that it gave on Tuesday will remember that it considers the power a small matter. It was not wildly excited in any way and said that it considered that the power made a small difference, if I remember rightly. That is not to dismiss the concerns, but some of the arguments that we will hear during this debate will put those concerns into context.

I have had many discussions with business groups. Sometimes, there is a danger that, in representing the views of members, the British Chambers of Commerce ends up painting the business community into a position on employee relationships that is not at all reflective of what the business community thinks. It creates a perception that is not reflective. The vast majority of businesses out there are anxious to ensure that they have good relationships with their employers.

There is a balance to be struck. The Bill addresses an insignificant issue to attempt to alleviate a concern, without dealing with the problem that businesses have. It would be good if we saw some policy making from the Government that identified a problem and proposed a solution to it, rather than proposing a solution to deal with the perception of a problem. By their own definition, it is not even the problem.

Andrew Bridgen (Conservative, North West Leicestershire)

What if those wider recommendations are erroneous or not accurate or not going to address the issues facing the business? The hon. Gentleman is arguing that a tribunal, in only a couple of days, will have more knowledge than the paid directors or owners of the business, and that might not be the case.

Toby Perkins (Labour, Chesterfield)

The sense that we had from the trade unions in evidence on Tuesday was that the power was modestly used, but was designed to be helpful.

Chi Onwurah (Labour, Newcastle upon Tyne Central)

My hon. Friend is making a strong and passionate point that has not so far been made in this debate on the reputation of small businesses and their interest and desire to have a harmonious working environment. While owners might not always know everything that goes on within a business, or how certain employees feel in certain situations, most businesses would welcome a better understanding of how the working environment could be improved, which these recommendations might provide.

Toby Perkins (Labour, Chesterfield)

Absolutely. That is an important point, which I will expand on in a moment.

Oliver Heald (Conservative, North East Hertfordshire)

Will the hon. Gentleman give way?

Toby Perkins (Labour, Chesterfield)

I will finish responding to my hon. Friend the Member for Newcastle upon Tyne Central, and then happily give way. I will expand in a moment on how businesses might feel after they lose a tribunal case and the effect that the wider recommendations might have on their perception.

I went from working for an employer with 500 or 600 members of staff to running my own business, so I know how difficult it is for small businesses to recruit staff of the right calibre. Lots of people, I think wrongly, want to work for a big company and do not recognise the opportunities in small businesses. It is incredibly important that we do not send out the message that if people want workers’ rights and a fair deal, they should work for a big businesses, and if they work for a small business they can forget all that.

Oliver Heald (Conservative, North East Hertfordshire)

The point that the British Chambers of Commerce made is that although the number of cases was small, the decision to fight them in the first place has a broader impact; its worry is that that affects employers. All the business representatives who responded to the consultation were in favour of repeal.

Toby Perkins (Labour, Chesterfield)

I thank the hon. and learned Gentleman for that point, but why do the 12 representations from businesses he received trump the 125 representations he received from everyone else? The fact is that 79% of those who responded on the wider recommendations think he is wrong, but he is saying, “Hang on, we’ve got a few who say we are right.”

Anyone who witnessed the evidence session on Tuesday will recognise that the British Chambers of Commerce must represent its members. When the Government introduce a Deregulation Bill that removes the expectation on its members, we know that it must support it. However, it was not hugely passionate, and it gave no sense in its representations that the Bill will make a big difference. We will not march out of here and be carried through the streets of Whitehall because of the change. On balance, it will not be good for employers. The British Chambers of Commerce felt that it needed to show some support for the Government’s attempts to deregulate, albeit that it did so modestly and unambitiously.

Andrew Bridgen (Conservative, North West Leicestershire)

But does it not say something that the employers’ organisations are happy to have the recommendations taken away in the full knowledge that it does not absolve the employers of their responsibilities or future liability, but only takes away the recommendations?

Toby Perkins (Labour, Chesterfield)

I guess the point the hon. Gentleman is making is that the fact that the recommendations are not enforceable is a bad thing. I think it is a positive thing. The employer can receive advice, take advantage of the recommendations and make the necessary changes to prevent it from going back to the tribunal. However, if it goes back to the tribunal 12 months later, the tribunal will say, “Hang on, some wider recommendations were made last time you were here. It looks like you didn’t take any notice of them.” That is an important piece of information for the tribunal when it considers how seriously the employer is trying to improve things from when it saw them 12 months ago.

Andrew Bridgen (Conservative, North West Leicestershire)

It would be sensible to assume that all employers who find themselves at the wrong end of an employment tribunal decision will look at their business practices, not necessarily because of wider recommendations. What if those wider recommendations are not compatible and would not help to solve its problems?

Toby Perkins (Labour, Chesterfield)

The hon. Gentleman is tempting me to get ahead of myself in my speech. He is asking whether all people who lose in a tribunal make changes. The evidence is that 59% of businesses that lose in a tribunal make changes and 41% do not. Clearly, that is a partial change. Sometimes there will be isolated incidents, but what happens in one tribunal case does not mean that a change of policy all the way down the line is needed. In many cases, people who lost a in tribunal once might want to make changes and are not doing so.

I have spoken to a huge number of employers over the past three years, and although they have brought up concerns about tribunals, not once have they brought up the issue of the wider regulations. No business likes being taken to a tribunal, and a business would like losing a case even less. Businesses often contest cases because they think that they are in the right in the first place. People across many sectors object to the idea that there is someone who can tell them what they have done wrong, but not how to put it right. We see that in school inspections and many other fields. People say, “They come in and criticise us but they do not actually tell us what we have to do to make things right.” We currently have a tribunal system that not only gives the stick but provides help on how to put things right.

The vast majority of employers want to be good employers, within whatever limitations they might have. They certainly do not want to be told that their office environment is sexist, racist, homophobic or whatever. Nevertheless, if they fall foul of the law—sometimes, particularly as businesses are growing, the culture changes without the owner’s intention—and a culture develops that they want to sort out, it is much easier for bigger companies with more resources and established policies to handle things. For small employers, who are often spinning thousands of plates at the same time and trying to keep their heads above water, it can be difficult to keep a grip on an unhealthy culture that develops as the company grows.

The panel empowered employers to say, “Right, the courts have told us that we got it wrong. We’re not going to get it wrong again. They have told us how we can ensure that we are not seen as an environment where racism, sexism or homophobia are casually accepted. We are going to take the necessary action.” If someone then says that there is a problem, the employer is actually protected. They can say, “Hang on a second; we had a complaint before. You gave us some recommendations and we went away and took advantage of them.” They would be in a stronger place to defend themselves in future tribunals.

By the same token, if employers have not taken the required steps, they cannot claim ignorance. If they are one of the small number of casual employers who do not care about these things, it will be there in black and white. A member of staff will be able to go a tribunal knowing that the company was told to take action a year ago because racism existed in the workplace, but nothing was done. That is the right balance.

To give some context, 56% of employers make changes after they lose a tribunal case. Many of the others are not subject to wider recommendations anyway. The change is therefore not about making things better but about the Government being able to go to the business community and say, “Look, we are trying to make things better for you.” That is being done with electoral purposes in mind, and rather than dealing with business’s issues, it deals with their perception.

The Minister cites the fact that not that many recommendations are issued as a reason to get rid of them; I think that the fact they are issued responsibly is a reason to keep them. Of all tribunal cases, 15% are lost on the grounds of discrimination. About 3% of that 15% actually go as far as the courts. Of that 3%, less than 1% get wider recommendations. That shows that we are talking about a power that is being used responsibly. It is still in its early days, and was supported by the Conservative party in its more enlightened days—as well as by the Liberal Democrats in their even more enlightened days.

It will be a big mistake to get rid of wider recommendations, and the Government are wrong to do so. It is far better to work with employers and say, “Look, tribunals are a rare thing, and we want to support employers so that they do not end up before one,” than to add to the impression that taking on members of staff is a terrifying thing to do. We are discussing a modest power that is being used modestly. The Government’s own impact assessment says that the net impact of the change will be to increase the cost to businesses because they will not have that crutch to lean on. It is not the part of the tribunal system that employers fear; it is a helpful addition to a process that may have been resented or found troubling. Removing the power will weaken tribunals, with no benefit whatever to employers.

Oliver Heald (Conservative, North East Hertfordshire)

We have had a short and lively debate. I was not too surprised when the hon. Member for Luton North said that he disagreed with clause 2, because he has made that point in the past. In so far as the hon. Member for Chesterfield is concerned, it is not right to see the Bill as the only thing that the Government are doing on deregulation because it is not. It is part of a process that includes the red tape challenge and measures taken to remove regulations. This Government will be the first to have less regulation at the end of their term than at the beginning, which is a remarkable achievement.

The consultation process is not a poll. It is about what the arguments are and whether they hold water. The Government are right to pursue a growth agenda to pull the country out of the mess that it was in. To do so, reducing burdens on business is important. If all the employers’ organisations say that something should be repealed when we ask them, if in evidence to the Committee they say that it has broader impacts on whether employers fight cases that they feel they should fight but perhaps do not in case the tribunal imposes heavy burdens and if a power is passed by this House but not used, as here, surely it should be scrapped.

The hon. Gentleman acknowledged that if employers lose a tribunal case, they look at what went wrong and at what was said to them. He made the point that most of them make changes so that something does not happen again. He said that changes were made in a little more than half of cases, but in some cases the problem is not systemic; it might simply be that a supervisor or someone else in the business did not behave as they should, rather than that proper protections and policies were not in place. My argument to the Committee is that this power is not being used to any extent, it makes no real difference and it is unenforceable, but it is affecting employers and hampering growth.

Karl Turner (Labour, Kingston upon Hull East)

The Solicitor-General is an eminent barrister and, no less, the adviser on legal matters to the Government. He suggests that because something is not being used, we should simply scrap it. The offence of infanticide is rarely used in my experience, but it is on the statute book for good reason. The offence of a mother within 12 months of giving birth bringing about the death of her own child is, I suspect, not one that is often charged but should we scrap it because it is not being used?

Oliver Heald (Conservative, North East Hertfordshire)

We are talking about deregulation. Of course there is a role for the offence of infanticide and I do not wish to see it repealed, but in Committee we are talking about business being restrained by barriers to growth, stopping this country achieving everything that it can economically. The power to be repealed is only a small part of the picture, yes, but the British Chambers of Commerce said that it can have broader impact and has affected the way in which employers see the tribunal process. It was interfering in that way, to use my words. In such circumstances, there is a case for repeal, which is why I am making it.

Kelvin Hopkins (Labour, Luton North)

We will come to the wider debate on growth a little later, but I made the point in a previous sitting that growth arises because of increasing consumer demand. Minuscule changes to the supply side by taking an almost negligible cost away from employers will make no difference at all to the wider economy. It is political window-dressing. I apologise, but I should make one other point. With tribunals, most employers learn from their one mistake—if a case goes against them—and do not do the same thing again. Tribunals, however, might judge that a particular employer—a minority—does need a bit more advice, if I may put it in those terms, and does need to be told.

Jimmy Hood (Labour, Lanark and Hamilton East)

Order. A bit too long.

Oliver Heald (Conservative, North East Hertfordshire)

I will make the point that what the hon. Gentleman has said reminded me of everything that is wrong about Labour. If we look after the pennies, the pounds look after themselves. The Bill will save £300 million over a 10-year period. That is not insubstantial. He may have noticed that some of the measures are small, but there are a lot of them, and the overall effect is to deregulate. We are also trying to reduce taxes and to do things that free up business to go out and achieve. Those things make a difference and I commend the clause to the Committee.