HC Deb 11 July 1966 vol 731 cc943-4
3. Mr. Ridley

asked the Minister of Labour how many firms of labour-only subcontractors are now in existence; how many men they employ in total; and how they are to be classified for the purposes of the Selective Employment Tax.

Mrs. Shirley Williams

No figures are available of the number of firms of labour-only subcontractors, nor of how many men they employ. Most firms of this kind are likely to fall under Order XXII (Professional and Scientific Services) or Order XXIII (Miscellaneous Services) of the Standard Industrial Classification and will receive neither premium payments nor refunds under the Selective Employment Tax scheme.

Mr. Ridley

Ought not the hon. Lady's Department to know how many firms and how many people there are operating as labour-only subcontractors? Does it not make it extremely difficult to run the economy without this information? Does she not agree that the Selective Employment Tax is bound to encourage the development of this sort of thing?

Mrs. Williams

I fully agree that this information should have been available a long time ago. The Government are at present undertaking a number of inquiries to try to establish this incidence. In answer to the second part of the question, the Government will, of course, keep very close watch on this development and the effect of S.E.T. on this group.

Mr. Channon

Does not the hon. Lady agree that it would have been wiser to await the information before introducing the tax? Would she not agree that an increase in the direct labour subcontracting force is against Government policy? Why introduce a tax which is bound to have the effect of increasing it?

Mrs. Williams

I fully agree that the Government are anxious to limit the amount of labour-only subcontracting. I do not accept the last part of the question.