Companies (Disabled Employees Quota) (Hansard, 23 July 1986)

§ Mr. Roland Boyes (Houghton and Washington)

I beg to move, That leave be given to bring in a Bill to provide for effective penalties to be applied to registered companies which fail to employ a specified quota of disabled persons. During periods of severe economic depression, disabled persons are much more severely affected than others when it comes to getting a job. The latest data available shows that unemployment among disabled persons is double that of non-disabled persons. It is not necessary for that to be so, because there is legislation on the statute book to protect the interests of disabled people who wish to work. The Disabled Persons (Employment) Act 1944 did three important things. It defined the term "disabled persons", it established the voluntary register of disabled persons, and it outlined the form of an employment quota scheme.

The quota scheme provides that all employers with 20 or more employees have a statutory duty to employ a quota of registered disabled persons, but the Act did not fix the level of the quota. However, in 1946 it was agreed that it should be 3 per cent. of the payroll. Although the 1944 Act was not binding on the Crown, Government Departments and the National Health Service nevertheless agreed to accept the same responsibilities as other employers. I shall demonstrate that, regrettably, Government Departments are among the worst offenders against the 1944 Act.

One of the problems with the present system is that it is not an offence for an employer to be below the quota, but it is an offence for an employer to engage someone other than a registered disabled person when the employer is below quota. There is a means of opting out for employers, and that is by applying to the Manpower Services Commission for a permit. Permits are issued by the MSC when it is satisfied that no suitable registered disabled person or persons are available. Regrettably, the MSC appears to issue permits, nearly always in bulk, with the same flippancy as a guest showers confetti at a wedding. This hypocrisy must stop. The system is a shambles.

Fines can be imposed on employers. If a company is obliged to employ a quota of disabled persons, it must keep a record, and failure to do so results in a fine not exceeding £20. I am sure that a fine of that size does not worry an employer for a second.

A few examples will illustate the problem. The Banking, Insurance and Finance Union carried out a survey among 31 companies in the finance industry. Between them the 31 companies employ more than 250,000, and the survey showed that only 2,000 are disabled. That is not 3 per cent. but less than 1 per cent. That is a disgrace and an outrage. In reply to a question from my right hon. Friend the Member for Stoke-on-Trent, South (Mr. Ashley) a Minister from the Department of Employment informed him that of the 35,481 firms subject to the provisions of the quota scheme, only 28 per cent. employed the full quota. A further 52.7 per cent. were below quota but had been issued with permits, and just about all of them were bulk permits.

That is unsatisfactory, and a number of questions must be asked. How many of the companies were checked? With what certainty can the MSC state that the companies were 367 operating within the spirit of the law? How many of the 17,000 or 18,000 companies issued with bulk permits have abused them? Did the MSC do any follow-up checking? What about Government Departments? They might reasonably be expected to set a good example but, regrettably, the situation is hopeless.

At the latest date on which information is available, only one of 27 Government Departments is at quota level, and that is the National Savings Department. Of the rest, only five Departments have reached 2 per cent. or more, and four are employing less than 1 per cent. The Home Office has reached a miserly 0.5 per cent. and the Department of Health and Social Security has reached 1.4 per cent., which is less than half the quota level. It is shameful that the great Departments of State set such a bad example. Ministers should hang their heads in shame.

What happens to companies which break the law? The answer is nothing. Since 1944, only 10 companies have been to court on this issue and three of them escaped a fine. Those which were fined faced exceptionally small penalties. To counter this situation, the hon. Member for Plymouth, Sutton (Mr. Clark), who is now Minister for Trade, argued on 14 May 1985 at a meeting with the all-party disablement group that there were not enough registered disabled persons to allow employers to achieve the 3 per cent. quota, because not all disabled people choose to register.

When the 3 per cent. quota was determined in 1946, consideration was taken of the probability that not all disabled persons would register. Some disabled persons do not register because of the lack of incentive to do so, and for others registration is counter-productive. Such is the discrimination against those who have suffered certain illnesses — for example, against those who have experienced a period of mental illness or sufferers from epilepsy — that many people choose to keep quiet about their problems.

Since the 1950s, however, the number of disabled persons registering with local authorities has increased from less than 200,000 in 1956 to over 1 million. Over the same period there has been a decline in the number registering for employment purposes from over 1 million to 400,000. The decline is due to the lack of specific and 368 real benefits as a result of registration. For those registering with local authorities there was immediate and tangible benefit, including car parking badges and bus tokens.

What should be done? Employers should be made to enforce the quota system. If disabled persons saw that efforts were being made to reach the 3 per cent. quota by private and public companies and Government Departments, there would be a greater incentive to register. Simultaneously, it would be easier for the MSC to take action against those employers not reaching the quota. The House should realise that 96 per cent. of all permits issued are bulk permits. There is an urgent need to stop the issue of these permits, as the present situation is no longer acceptable on either economic or moral grounds. There is a need for more inspectors to discover the companies which are infringing the present arrangements. There is a need for more prosecutions to be taken against companies flouting the law.

My Bill is aimed at giving disabled persons more opportunity to obtain work. It is also aimed at giving notice to employers subject to quota that, if there is no improvement, effective action will have to be taken against them, and that will be by the introduction of penalties that are large enough to make it extremely costly for an employer to ignore the quota. If doing so helps unemployed disabled persons to get jobs, it will be worthwhile.

Question put and agreed to

Bill ordered to be brought in by Mr. Roland Boyes, Mr. Jack Ashley, Mr. Alfred Morris, Dr. David Clark, Mrs. Ann Clwyd, Mr. Mark Fisher, Mr. Peter Pike, Mr. Tony Banks, Dr. Norman A. Godman, Mr. Jeff Rooker, Mr. David Clelland and Mr. Richard Caborn.