§ 4.9 pm
§ The Paymaster General and Minister for Employment (Mr. Kenneth Clarke)
With permission, Mr. Speaker, I should like to make a statement on Government action to relieve the burden of unnecessary regulation. We are publishing today a White Paper entitled "Building Businesses — Not Barriers". It contains a balanced series of new proposals for reducing the administrative and legislative burdens on business as well as a report on the progress made in furthering the proposals made in the last White Paper on this subject, "Lifting the Burden".
The White Paper reflects our firm belief that only by removing barriers to business will enterprise flourish and the essential creation of wealth and jobs follow. It presents a balanced programme that recognises that Government have a role in providing legal protection for workers, consumers and the general public, as well as protecting the environment and our quality of life. However, it also recognises that unnecessary regulations act as an inhibition to business growth and job creation.
In the White Paper, the Government have maintained these protections while still taking a series of significant steps forward in giving business the freedom to grow.
There are nearly 80 new proposals in "Building Businesses — Not Barriers". First, the work of the enterprise and deregulation task force, liaising with deregulation teams in Departments, will ensure that there is a proper analysis of the effects of proposed new rules and regulations on businesses.
We shall modernise the use classes order to allow a somewhat wider range of changes in the use of buildings or land to take place without planning permission. We shall permit businesses with planning permission for two or more alternative uses to change between these without the need for further planning applications. I stress that we do not propose to change the law on working from home.
We shall be setting up a major review of value added tax and small businesses, considering such issues as accounting for VAT on a cash basis rather than using invoices, and an instalment system for VAT payments.
We are introducing a more personal approach by civil servants in their dealings with business, so that responsibility will be linked to individual, named officials. We shall be reducing the duplication of visits by Government officials. PAYE and national insurance inspectors are now co-ordinating their visits to companies and we are introducing a pilot scheme to co-ordinate visits by Inland Revenue and Customs and Excise officials.
These are just a small sample of the efforts being made throughout every Government Department and agency to cut red tape and improve communications. Our proposals are carefully measured. None cross the fine dividing line between liberty and licence.
As well as concentrating on reducing domestic burdens, the White Paper also reports on progress towards cutting the bureaucracy imposed by EEC regulations and directives. Following an initiative made by the Prime Minister, a task force has been established within the European Commission to scrutinise all future proposals that might affect business, so that the costs of compliance can be minimised.
543 At the same time as publishing "Building Businesses — Not Barriers" the Department of Employment has launched a booklet "Cutting Red Tape". It summarises the contents of the White Paper in a popular and easy-to-digest way.
There can be few more urgent tasks than to create the climate for growth of employment. The more people concentrate on running their businesses, free of unnecessary barriers, the better for jobs, and more jobs is our aim—one, I am sure, shared by both sides of the House. This White Paper will help jobs without losing any necessary protections for the public. I commend it to the House.
§ Mr. John Prescott (Kingston upon Hull, East)
The Paymaster General's statement has a certain familiarity about it, not because it was made earlier in the other place, but because it very much follows the recommendations made in the previous White Paper on this subject, on which a statement was made on 16 July 1985. Much of the rhetoric in the Paymaster General's statement masked a further attack on the protection of employees, the reduction of controls on the employer and the continued processes heralded in the last statement, made on 16 July, on "Lifting the Burden". The motive of that White Paper, as the Paymaster General will no doubt accept, was to sacrifice the principles governing the green belt, health and safety, and industrial rights.
Is the Paymaster General aware that the phrases contained in his statement were exactly the same as those made on 16 July 1885 by the right hon. Member for Croydon, Central (Mr. Moore)? Does the Paymaster General realise that the words and phrases, lifted from column 171 of Hansard, include:enterprise to flourish … essential for the creation of jobs. … a central task force is being set up … Essential protection for workers, consumers and the general public … protect our quality of life … the balance between liberty and licence".—[Official Report, 16 July 1985; Vol. 83, c. 171.]Was the same word processor used for the two statements? Remarkably, I found that on 16 July 1985, there were 80 proposals in the White Paper, as there are 80 proposals in this White Paper.
Will the Paymaster General recognise that many of the proposals in this White Paper are embodied in the first White Paper? A great deal of rhetoric has been employed in this statement about creating enterprise and jobs. How many jobs have been created since the last exercise in cutting red tape? It was suggested that 8,000 jobs would be created, but in reality, 4,000 jobs a week have been lost since that statement.
Is the Paymaster General aware that the survey conducted by his Department justifying measures in the White Paper clearly showed that the burden of VAT was the main consideration for small companies, but again, the White Paper offers only a promise of further reviews, the payment of VAT on HP terms and that civil servants will visit less often and be nicer? Does he accept that the real reason for this White Paper is yet another attack on the limited employment rights of workers, rights that are identified in the White Paper, and which are shown in the survey not to be a difficult problem for small businesses?
Can the Paymaster General honestly justify his belief that the measures in the White Paper will provide jobs? For example, what help will be provided by imposing a deposit 544 of £25 on workers who go to an industrial tribunal, removing the rights of pregnant women to return to their companies, reducing the time off for trade union members to conduct trade union activities at the place of work, or removing unfair dismissal and redundancy rights for hundreds of thousands of workers in many companies?
Will the Paymaster General accept that the real purpose of this White Paper, masked in rhetoric to justify deregulation, is to cut employment rights and increase unemployment? As the House was reminded by the statements in the press today and yesterday, a further 20,000 bus workers are to go on the dole as a result of deregulation of the bus industry.
§ Mr. Clarke
I am disappointed that the hon. Member for Kingston upon Hull, East (Mr. Prescott) began by attacking these proposals for lifting various unnecessary administrative burdens on business as somehow an attack on workers' rights or a reduction of essential public control. The hon. Gentleman was a supporter of the Government who left office in 1979, leaving industry with its profits, its prices and its wage rates controlled, and under a huge burden of bureaucracy. That greatly weakened our industrial base as we went into the worst of industrial recessions. The White Paper's proposals are a series of modest steps that will get rid of unnecessary bureaucracy. The American experience, contrasted with the European experience, shows that that can only help in generating new jobs by leaving businesses more free to concentrate on the most essential tasks.
The hon. Gentleman mentioned various public policies that he said were threatened. The White Paper says that there is to be no change in policy on the green belt and the proposals made for town and country planning are modest and sensible, and allow greater flexibility for high tech companies in particular. It is made plain in the White Paper that there is no attack on the concept of health and safety at work and no intention to lower standards.
The hon. Gentleman rather dismisses the review of VAT, but it is to be a wide-ranging one, and I touched in my statement on some of the important matters that it will cover. It will also cover the operation of the new penalty system that is being introduced, after consultation, into the VAT system.
As to employment protection, the hon. Gentleman cites various measures that he says are an attack on working people. I do not think that it is easy to get indignant about the proposal that the legal entitlement for time off for trade unionists should be confined to those trade union matters that are relevant to the company where the official works.
The other changes will enable the labour market to be more flexible and they will make it easier for employers to offer different types of employment. They will also encourage the growth of part-time and short-time working and the other forms of employment that are growing, both in this economy and in every other modern economy.
I am sorry that the hon. Gentleman dislikes the fact that in this statement the same favourite phrases appear as appeared in the statement that was made by my right hon. Friend who is now the Secretary of State for Transport. However, it was made in 1985, not in 1885 when Lord Salisbury was Prime Minister. I am sure that my right hon. and noble Friend is glad to know that he is carrying on the same Tory tradition as existed then. Of course we are pursuing the same theme. That is because we are pursuing the same policies. We are deregulating in order to enable 545 business men to concentrate on the essential task of building up their businesses. The fact that there were 80 proposals then and that there are a further 80 proposals now shows that we are maintaining a good rate of progress. They are the result of looking at the activities of all branches of government.
§ Mr. Clarke
For the first time in this country we are questioning the growth of administration and bureaucracy since the second world war. We are seeking to reduce it in the interests of enabling businesses to be more free to create new jobs.
§ Mr. David Howell (Guildford)
Will my right hon. and learned Friend accept that this White Paper, like the last one, is thoroughly constructive and is to be welcomed, and that it is entirely in line with the new pattern of work and the new employment landscape that the Opposition will not begin to understand and, when they do understand it, quite wrongly oppose? I accept that in both "Lifting the Burden" and this new White Paper questions are tackled about the position of the self-employed, but the widespread impression still exists that the Inland Revenue is hostile to the self-employed and to the growing army of people who wish to organise their affairs in that way. Will he look particularly at that matter and consider how it can be changed?
Does my right hon. and learned Friend also accept that the time has come when the Government might recommend to Members of this honourable House that they, too, might consider returning to the self-employed status that they once held in order that they may understand the problems that face the self-employed in this country?
§ Mr. Clarke
I am grateful to my right hon. Friend. The number of self-employed people is growing strongly. About 12 per cent. of those who are working in this country are now self-employed. That number is likely to increase, and it should increase if we follow the kind of developments that have taken place in successful modern economies elsewhere. We have already taken steps to help the self-employed. Probably the most significant step was the reduction in their national insurance contributions. The White Paper proposes that the issue of 714 certificates to those who legitimately require them to work in a self-employed capacity in the building industry should be speeded up. I am sure that my right hon. Friend the Chancellor of the Exchequer will seek to ensure that no hostility to legitimate self-employment prevails inside the Inland Revenue. I agree entirely with the general drift of my right hon. Friend's questions.
§ Mr. Ron Leighton (Newham, North-East)
Does the Paymaster General not recognise that the more chatter we hear from him about deregulation the more unemployment increases every month? Furthermore, are not the rights of workers being reduced? They can appear before an industrial tribunal where their case is upheld, but, in the case of the miners who were dismissed, the National Coal Board still refused to reinstate them.
The main thing that is being deregulated is accountability to this House. The Paymaster General must realise that all this was dealt with elsewhere this morning. The noble Lord, Lord Young, dealt with all of this on radio. All the House of Commons is getting is the fag-end. The Paymaster General comes to the House as a messenger boy. Is that not an insult to the House of Commons?
§ Mr. Clarke
On the hon. Gentleman's first point, it is essential that we should have a good and effective system of employment protection law, but that does not mean that we should retain obsolete or over-complex provisions which deter employers from offering new employment to those whom they might otherwise engage. That is the general theme that runs through this package.
On the hon. Gentleman's second point, he knows that all Governments have Ministers in both Houses of Parliament. My right hon. and noble Friend and I have worked together on this package. We worked together also on the drafting of this statement. We have followed the ordinary practice of making the statement together on the same day in both Houses. It was to the surprise of my right hon. and noble Friend and me when we noticed that, because of our anxiety to make the statement before the recess, we were due to deliver it on a day when the rules of another place required my right hon. and noble Friend to make his statement in the morning but the rules of this place did not enable me to make it before 4 o'clock. We try to explain Government policy to both Houses in accordance with the positions that we hold, but I am afraid that the practice of both Houses does not enable my right hon. and noble Friend and me to guarantee that we can synchronise our watches and rise in both Chambers at the same time. As their Lordships are sitting earlier than this House today, their Lordships have the advantage over us.
§ Mr. Michael Grylls (Surrey, North-West)
Does my right hon. and learned Friend accept that it is clear that he and his right hon. and noble Friend have made real progress in slaying the dangerous dragon of red tape? Therefore it would be more sensible if, rather than criticising, the Opposition were to recognise that the reason this country has created jobs at a slower rate than in the United States is that we have been over-regulated. This deregulation programme is probably the single most constructive measure we can take to create new jobs at a faster rate.
Will my right hon. and learned Friend look at the deregulation units in the Departments and examine whether they could be a little more effective and act more quickly? Perhaps a junior Minister in my right hon. and learned Friend's Department could be made responsible for deregulation. The recent problem that we experienced when responsibility for family credits was laid upon businesses would not then arise. We might also avoid the somewhat farcial situation that has arisen over the working of the Data Protection Act 1984. The policy is working, but we should like it to work a little faster.
§ Mr. Clarke
I am grateful to my hon. Friend who, throughout his time as a Member of Parliament, has been urging this kind of policy on successive Governments. am glad to hear that he is pleased that it is now being implemented in successive White Papers. We intend to keep up the effort. The White Paper explains the new deregulation arrangements that have been established throughout Whitehall. We have reached this stage following the co-ordination that was carried out by my right hon. and noble Friend and me of the activities of various Departments. Junior Ministers in those Departments have been involved in the exercise. Indeed, they are responsible for the detailed proposals that are contained in the White Paper and for their execution. We 547 have ensured that deregulation in high on the agenda in each Department in Whitehall. There are effective deregulation units in each Department.
§ Mr. Richard Wainwright (Colne Valley)
The two alliance parties welcome, so far as it goes, the Government's attempt to compensate for the hugely increased burdens on business because of high real interest rates and the extravagant unit labour costs that are due to the absence of an incomes policy. I commiserate with the Paymaster General. The statement, having been deferred from yesterday until today, when it could have been made simultaneously in both Houses yesterday, means that his right hon. and noble Friend asserted his complete leadership of the Department by delivering it four hours before the Paymaster General rose in this House.
Will the Paymaster General give an assurance that the scheme to co-ordinate visits from the Inland Revenue and Customs and Excise Departments will not decrease the honourable rule that no single Department should divulge to another Department answers that it has received from a citizen in respect of its departmental requirements?
As for the proposal that responsibility will be linked to individually named officials, before the Paymaster General proceeds down this very dangerous avenue in which his Government have already established a most unhappy precedent, will he and his right hon. and noble Friend read carefully the report of the Treasury and Civil Service Select Committee, which was published today, on relations between civil servants and Ministers? It lays down in firm, all-party terms the need for no repetition of the circumstances in which a young civil servant at the outset of her career was named in respect of a piece of behaviour for which she was in no way responsible.
§ Mr. Clarke
The hon. Gentleman began by expressing support, for which I am grateful, although he wrapped it up rather heavily thereafter. Of course my right hon. and noble Friend is the head of Department and Secretary of State for the Department. I assure the hon. Gentleman that, if he thinks that this was the result of any planning, it was at a remarkably late stage that my right hon. and noble Friend and I realised that the rules of our respective Houses would mean that the other place would act first in its discussion of this proposal.
I assure the hon. Gentleman that there will be no change in the existing rules on the confidentiality of information about individuals between Departments as a result of the White Paper. The proposal about named officials will not, of course, mean that there is any transfer of ultimate responsibilities. It is Ministers who will remain accountable to this House for the way in which policy is drawn up and executed. The intention is that we get away from the situation where a business man or an individual citizen can sometimes feel that he is dealing with a literally faceless bureaucracy and have no idea who is handling his problem in a particular Department. The result should be an improvement in the relationship between Departments and citizens to the advantage, I should have thought, of both officials and citizens.
§ Mr. Robin Maxwell-Hyslop (Tiverton)
Does the White Paper herald the bringing under control of the Inland Revenue and Customs and Excise by the Minister's own Secretary of State, so that they do not in future issue 548 practice directions or regulations that undercut what his Department is doing? This is very important. For instance, there is the change in the rule that, after a VAT inspector has certified accounts as being in accordance with his Department's requirements, a subsequent inspector can cancel that and say, "No, I don't agree with the previous inspector." It is very important that a Minister in his own Department should see in advance and approve all changes in the Inland Revenue practice directions and regulations that do not pass through this House, and similarly in the case of Customs and Excise. Has this now been arranged as a working process so that the Treasury and its subsidiaries do not undercut the valuable work done by his Department?
§ Mr. Clarke
It is my right hon. Friend the Chancellor of the Exchequer and the team of Treasury Ministers who are accountable for the Inland Revenue and Customs and Excise, and it is to them that the Inland Revenue and Customs and Excise report. I am glad to say, however, that liaison between my right hon. Friend the Chancellor and his team of Ministers and the team of Ministers in my Department is very good. In regard to our responsibilities for small business in particular, we ensure that, with our representations, the representations of my hon. Friend the Member for Rossendale and Darwen (Mr. Trippier), the Under-Secretary of State for Employment, who takes a close interest in these matters, are regularly put into the Treasury and taken into account when the Inland Revenue and Customs and Excise are considering the way in which they behave.
§ Mr. James Lamond (Oldham, Central and Royton)
Is the Minister aware that what he referred to as bureaucratic regulations, particularly in regard to planning, have over a number of years often avoided rather unhappy situations? If he is trying to tell us today that change of use regulations, for example, have to be considerably modified or swept away, will he not remind himself of the cases that he, like all hon. Members, must have had, of the entrepreneur who has come along, spotted a redundant chapel and thought it would make a nice place for breaking up motor cars or boiling sheeps' heads? The people who live in the area, far from regarding change of use regulations as bureaucratic, see them as an important defence for them and their neighbours. Surely we must take that into consideration.
§ Mr. Clarke
I agree with the hon. Gentleman that we need an effective system of town and country planning control. I also agree that the present system has piled up over the years, often as the result of individual problems. I believe that it is important that we step back occasionally and make sure that the system as a whole corresponds to public needs but does not put unnecessary obstacles in the way of business expansion. The next stage, for instance, in the use classes order revision is to go out to consultation, again with a modified version of the proposals first put forward by the Property Advisory Group. I assure the hon. Gentleman that changes will be made only when we are satisfied that this can be done without damaging the legitimate interests of people living in residential areas who obviously do not want noxious businesses near where they live.
§ Mr. Henry Bellingham (Norfolk, North-West)
While I welcome the White Paper as a positive step forward and 549 applaud the Minister on his presentation, which compares very favourably with that of the hon. Member for Kingston upon Hull, East (Mr. Prescott), who shows yet again that he is out of date and out of touch, will my right hon. and learned Friend agree that it is not enough for the White Paper to talk in terms of officials giving their addresses and telephone numbers? What is needed is a complete change of attitude, so that all officials become more pro-business and more pro-entrepreneur.
§ Mr. Clarke
I am grateful to my hon. Friend. I agree with his point. I am sure that most officials would welcome pressure to adopt such an approach. A great deal of effort is being put into training officials in Departments such as Customs and Excise to make sure that they improve their relationships with the general public and understand the needs of small business when they are carrying out their essential tasks.
§ Mr. Tam Dalyell (Linlithgow)
May I ask a question that is not necessarily hostile? Has the question of responsibility of named civil servants been discussed with the Civil Service trade unions? Regarding his answer to the hon. Member for Colne Valley (Mr. Wainwright), is the Minister entirely happy that ultimate responsibility will still remain with Ministers because, once individuals are named, the fact is that, like it or not, responsibility sticks to them? In the circumstances, and in the light of the agony of the Ponting trial, is there not yet again an argument, if the Government are going to do this, for setting up some body to which a civil servant who is in difficulty can turn? As long as ultimately one has the Cabinet Secretary as head of the Civil Service, in real terms it is very difficult for a civil servant to appeal.
§ Mr. Clarke
When the hon. Gentleman asks questions that are necessarily hostile, he sometimes asks easier questions than the ones which are not necessarily hostile.
I do not believe that any formal consultation has been carried on on this proposal. We will obviously be interested in any views that the Civil Service unions have. I would expect that officials in the relevant parts of the Administration will probably welcome the changes that we are proposing. I assure the hon. Gentleman that there will be no weakening of the constitutional position, whereby the responsibility rests with the Minister answerable to this House. Policy responsibilities that are properly those of the Government and of Ministers will not be wished on to officials.
When the hon. Gentleman goes into the last matter, of course, he goes far outside my field and far outside the White Paper. I do not believe that the White Paper will present any difficulties between officials and Ministers of the kind that he describes.
§ Mr. Tim Smith (Beaconsfield)
As small businesses regard the recording and collection of VAT as the major burden that they have to bear, does my right hon. and learned Friend accept that the proposal for a major review of VAT will be widely welcomed by small businesses? Can he make sure that it will include the proposition made by the National Federation of Self Employed and Small Businesses for the elimination of VAT between registered traders on credit transactions? If accepted, that could reduce the burden of those traders very substantially.
§ Mr. Clarke
I am grateful to my hon. Friend. I assure him that it will be a wide-ranging review and can certainly 550 look at propositions put forward by the National Federation of Self Employed and Small Businesses, which is actively interested in this matter. It will probably not be completed before 1987, but we are already taking some steps, such as our efforts to raise the thresholds. We have already had some success, although we still have to lobby further in the European Community. In addition, we have introduced some relief on VAT payments for bad debts. This, too, has been of benefit to some small businesses.
§ Mr. Ken Eastham (Manchester, Blackley)
Is it not a fact that, when the original consultation document' Lifting the Burden" was issued, it was highly speculative as to the people being consulted and, in the event, workers' groups and the trade unions were never consulted? Many people look on this as a possible cowboys' charter. We have seen reductions in the standard of planning and building reguslations and fire precautions. With regard to the emphasis on small companies, I remind the Minister that some of the greatest disasters have occurred in small firms. In 1981 at a small chemical firm in Stalybridge just outside Manchester, at which only 15 people worked, there was a fatality and half the town had to be evacuated. Are these the kind of standards that the Minister is encouraging?
§ Mr. Clarke
There is obviously an essential level of public safety and safety for people at work that nobody wishes to lower. The imposition of unnecessary or bureaucratic standards in industry is undoubtedly very inhibiting to business growth. The purpose of this exercise is to try to sort out the one without damaging the other—thatis, to sort out those parts of bureaucracy that can be relaxed without damaging essential public safeguards. I hope that more people in the trade union movement will come to realise that a constant demand for ever more regulations to increase, as they see it, the rights of those in work can sometimes lead to damage being done to the interests of those not in work if the result is to discourage business or employers from taking on new employees.
§ Mr. John Butterfill (Bournemouth, West)
Will my right hon. and learned Friend accept, in relation to the use classes order that many of the concerns arise not because of changes within, say, parts 3 to 10 on different types of shop or extensions to shops, but because of activities in residential areas that may be offensive to the residents? Will he bear that seriously in mind when considering the matter? Will he also bear in mind that some of the changes proposed within the residential connotation, such as the change of use from hotel or guest house to a rest home, will cause considerable difficulty in many resort towns in my constituency in particular?
May I congratulate my right hon. and learned Fiend on the proposals for redundant agricultural buildings? It is absurd that agricultural buildings of considerable architectural merit have in the past been allowed to fall into disrepair and decay simply because no alternative use could be found for them. Will he please encourage the Ministry of Agriculture, Fisheries and Food to reconsider its policy of insisting that agricultural land must remain agricultural land for ever when at times it could he better used for leisure or recreational purposes without damage to the countryside or the landscape?
On the point made by my right hon. Friend the Member for Guildford (Mr. Howell), may I urge my right hon. and 551 learned Friend to consider the position of the self-employed whose businesses may fail and who may be unable to enjoy the benefits that would otherwise accrue to those unemployed?
§ Mr. Clarke
I am grateful to my hon. Friend. On the town and country planning points, it will be easier to make progress with changes that give greater flexibility in the use of business premises. I think that those can go ahead rapidly. It is necessary to take more care over changes that might affect residential areas. I am sure that that will be the principal aim of the further process of consultation that is envisaged before we come to conclusions on the use classes orders.
I am grateful for what my hon. Friend said about the use of former agricultural buildings. That would be a great advantage to rural areas. In continuing conversations with my right hon. Friend the Minister of Agriculture. I shall bear in mind what my hon. Friend said about the present arrangement for protecting agricultural land.
As for the self-employed, we give a great deal of support through the enterprise allowance scheme and through the small business service to those unemployed who wish to become self-employed. I agree that it is important to bring home to the self-employed the possible consequences of moving into self-employment, particularly if the business fails. Obviously all our efforts are designed to reduce the risk of business failure.
§ Mr. D. N. Campbell-Savours (Workington)
Is not much of the document based on the mistaken premise that deregulation in the United States of America put several million people back to work during 1983, 1984 and 1985? Is not the real truth of the American success that its economy was reflated due to a very high budget deficit and PSBR, that they spent money to put people back to work and that they did not have to deregulate?
§ Mr. Clarke
I am not one of those who believe that any one cause can be identified for favourable or unfavourable movements in employment. This is not the occasion to debate the performance of the American economy over the last few years. Certainly there was an unintended increase in the American deficit, which had some effect on the economy. It involved a deficit that could not possibly be sustained by an economy of our size. An important element in the American experience has been the much more dynamic nature of their economy, the greater spirit of entrepreneurship which undoubtedly exists in America, and the fact that their experience of deregulation has enabled their most enterprising business men to make more rapid progress. In Massachusetts, where unemployment has collapsed from 11 per cent. or 12 per cent. five years ago to under 5 per cent. one of the elements was undoubtedly the fact that that is a much less regulated economy than the equivalent here or in western Europe.
§ Mr. Richard Holt (Langbaurgh)
My right hon. and learned Friend has done a wonderful job in bringing this forward. One part that I heard with delight was the reference to the £25 deposit. I hope that he does not think that he can fob me and the rest of the business world off with that as the only thing that will help with industrial tribunals. We have twice been promised a thorough review of the activities and workings of industrial tribunals, 552 particularly their legislation. The lawyers here may not agree, but I hope that my right hon. and learned Friend will have the courage to bring forward a review of legalisation.
§ Mr. Clarke
My hon. Friend has strong and clear views about the working of the industrial tribunal system, some of which I had the pleasure of listening to in the proceedings on the Wages Bill.
I am glad that we have given limited satisfaction to my hon. Friend by proposing for discussion a £25 fee. It has always been the aim of successive Governments to avoid unnecessary legalisms in the industrial tribunal system. We continue to have that aim. There are limits to how far one can go when a system which has been set up by statute decides on set awards of compensation. Anything we can do to avoid an increase in unnecessary legalism we shall continue to do.
§ Mr. Peter Pike (Burnley)
Can the Paymaster General state clearly how many people the proposals will put back to work and how far his Department is prepared to go in eroding the conditions of workers and the protection afforded to employees in order to solve the problems created by his Government?
§ Mr. Clarke
The hon. Gentleman knows that it is impossible to put exact figures on the extent to which particular actions of Government will help to create more jobs, or the extent to which they will damage job creation. I believe that the White Paper will make it easier for business to create jobs in the economy. To return to a more rigid system of controls and regulation favoured by the Labour party would have the perverse, though unintended, effect of actually reducing the prospects of more employment.
§ Mr. William Cash (Stafford)
Will my right hon. and learned Friend accept that in many respects the proposals follow the Small Business Bill introduced last Session? Will he accept further that there are in the proposals many interesting factors that have yet to be improved? It would be better in certain respects if we went for a package of deregulation and at the same time for a package which ensured that the legislation itself was reduced before coming into effect; in other words, we should have fewer regulations so that we do not have to deregulate afterwards.
§ Mr. Clarke
I happily acknowledge our indebtedness to my hon. Friend and others for the proposals which have arisen from the Small Business Bill and for their continued interest in the subject. It is a continuing process. Some of the proposals which I wish to implement will require legislation. The unit will continue to identify other areas where we can deregulate. The most important part of the proposals is that we will have a unit in the Department expressly charged with keeping an eye on what is emerging from the whole of Whitehall. In future no Department of Government can introduce fresh regulations without first considering their compliance cost for small business. It is the inexorable growth of more and more bureaucracy that the Government are trying to avoid.
§ Mr. James Couchman (Gillingham)
Speaking for small business, may I point out to the Minister that the prospect of a co-ordinated visit by Her Majesty's inspector of taxes, the DHSS lady in regard to the national insurance contribution, and the water guard wishing to examine my 553 VAT returns is daunting and is likely to precipitate my throwing in the towel, not to mention possibly causing an untimely by-election in Gillingham.
To be more serious, does my hon. and learned Friend accept that one of the biggest barriers to growth in the hotel, restaurant, catering and licensed trades is the outdated licensing law? Does he agree that paragraph 8.54 on liquor licensing hours is disappointing? Will he speak to his right hon. Friend the Home Secretary about getting earlier action than is presently promised?
§ Mr. Clarke
I know that no business man welcomes a visit of any kind from officials in those departments, not least because it consumes much time. One co-ordinated visit should be better than visits on successive days, which might occur. On the licensing laws, my right hon. Friend the Home Secretary made it clear earlier this week that the Government accept in principle the case for reform of the licensing laws. I have always believed that our licensing laws are archaic and much in need of reform. The Government will try to find out what consensus emerges for improvement and how soon it will be possible to bring proposals before the House.
§ Mr. Roger Gale (Thanet, North)
Those of us who are interested in the development of the tourist and leisure industries will be especially grateful for the support that my right hon. and learned Friend, his noble Friend and the deregulation unit have given to those industries. Needless to say, we hope very much, as my hon. Friend the Member for Gillingham (Mr. Couchman) has said, that that support will be carried through into action and that there will be a change in the licensing laws.
I draw my right hon. and learned Friend's attention to the point made by my hon. Friend the Member for Bournemouth, West (Mr. Butterfill). Chapter 5.7 of the report deals with the use classes order. It states:The Department of the Environment will be publishing early next month a consultation document which sets out the Government's proposals in detail.Is my right hon. and learned Friend aware that those of us involved with the tourist industry will be very concerned if consent is given for the conversion of small hotels and guest houses either to rest homes or to a return to the DHSS use that we saw two summers ago?
§ Mr. Clarke
I am grateful to my hon. Friend for his first point. It is interesting that hon. Members who take most interest in the development of the fast-growing sectors of the economy such as tourism and leisure have welcomed this document and the initiative. I believe that many new jobs will be created through the Government's approach to tourism and leisure. I understand what my hon. Friend says about the use classes order. There will be consultation over that matter and I am sure that my hon. Friend's point will be made very strongly to my right hon. Friend the Secretary of State for the Environment before any changes are made.
§ Mr. Eric Forth (Mid-Worcestershire)
My right hon. and learned Friend will know by now that there is universal welcome from the Conservative Benches for the initiative that he is taking. However, will he tell the House whether he is satisfied about the progress that has been made in connection with the "Lifting the Burden" initiative adopted by' his Department last year'? Will he give the details of the progress that has been made? Does he believe that the same progress will be made, with the same speed, with the proposals that he has brought to the House today?
§ Mr. Clarke
Annex 1, appendix A, of the White Paper and, indeed, annex 1 generally, deals with a summary of the action on the proposals set out in "Lifting the Burden". I admit that one or two of the proposals have bitten the dust since "Lifting the Burden" was published. However, we have made progress with most of the proposals. The changes that have been made reflect the care that must be taken in sensitive areas such as health and safety, which hon. Members have mentioned today. This is a continuing process and our main anxiety is, as my hon. Friend would wish, that we should not lose the momentum behind the exercise.
§ Mr. James Hill (Southampton, Test)
I see That planning appeals are to be speeded up. That will he appreciated. The document also states that planning controls will be reduced in some minor way. The whole idea of deregulation is to create job opportunities. Is my right hon. and learned Friend aware of a campaign that I have been fighting on behalf of the six freeports in the United Kingdom? We are desperately seeking deregulation in such ares as Customs and Excise taxes and imposts, and on VAT between customers within the freeports. The lack of deregulation in the freeports is causing difficulties and is not creating job vacancies. Is there anything in the White Paper which will give me hope when I speak to the manager of the Southampton freeport?
§ Mr. Clarke
In answer to my hon. Friend's point about planning appeals by inspectors, we have now managed to release the results of the efficiency scrutiny report that we carried out, and targets have been set to reduce the handling time of appeals. That is set out in paragraph 5.17 of the White Paper, and I am glad to see that my hon. Friend is making use of the clear, shorter document, and that that has enabled him to ask this question.
Freeports will be involved in the review of VAT. My hon. Friend will be reassured to know that the full White Paper expressly mentions that as a matter for investigation. The impact of VAT rules and the application of VAT on the development of freeports will be examined.
§ Mr. Peter Bruinvels (Leicester, East)
I welcome my right hon. and learned Friend's continued commitment to helping small businesses. I believe that "Building Businesses—Not Barriers" is a great success story that should be promoted throughout the country. Will my right hon. and learned Friend develop from annex 4 the question of wider competition in our postal services? Competition is healthy and small businesses can benefit from the alternatives that other fast letter carrier services can offer. In connection with the Registered Homes Act 1984 and the Nursing Homes and Mental Nursing Homes Regulations 1984, my right hon. and learned Friend will be aware of my anxiety that too many of these homes are springing up —rather like mushrooms — without proper controls. While I want controls to be reduced, will he reassure the House that no advantage will be taken of our old people when they need to be looked after?
§ Mr. Clarke
My hon. Friend will have noticed, as I have, that parts of the trade union and labour movements are still keener on the barriers than on the businesses when it comes to a choice between the two. I also approve of competition in the interests of the consumer, and I shall draw his remarks to the attention of my right hon. Friend the Secretary of State for Trade and Industry, who has responsibility for the postal services.
555 The Government legislated less than two years ago to improve the controls over new nursing homes, to ensure that the interests of the best and legitimate nursing homes were not damaged by the incursion into that area of homes which dropped below essential nursing and other standards. That shows that, when it is necessary to protect the public, the Government improve controls, so long as we are satisfied that they serve a serious purpose, and best protect elderly and sick people against exploitation in sub standard homes.
§ Mr. Anthony Steen (South Hams)
I welcome my right hon. and learned Friend's comments about licensing. Is he aware that there is a special problem about the 200 commercial vineyards? These need a special vineyard licence to allow them to offer tourists tastes of their wares throughout the day. At present, they must have an off licence and an on licence. If a visitor arrives during the off licence period, he cannot taste wine as he can anywhere else in Europe. Will my right hon. and learned Friend make a simple alteration to this excellent document to allow tourists to taste our splendid English wine whenever they choose to drop in at a vineyard?
§ Mr. Clarke
At present we are considering no fewer than 65 licensing systems, as is explained briefly in the Bill. We are certain to act promptly on the licensing requirement for public billiard halls. That dates back to social conditions, which have no relevance today. My hon. Friend has raised a pertinent point and he appears to have identified yet another of the idiocies of our liquor licensing system. We all hope that my right hon. Friend the Home Secretary will soon be able to crystalise his ideas over the licensing laws. We shall then have to see when we can get the legislative time to bring reforms forward.
§ Mr. John Evans (St. Helens, North)
Is the Paymaster General aware that, when the Minister of State for the Armed Forces rises to make a statement to the House in a few minutes' time, the other place will interrupt its business so that a simultaneous statement can be made? is that not an excellent example, not only of the contempt that the Secretary of State for Employment has for this House, but of the contempt he has for the Paymaster General?
Is the Paymaster General also aware that his proposition that individuals should be charged £25 deposit for appealing to an industrial tribunal is yet another example of the way that the Government have steadily removed and eroded the rights of the ordinary citizen? The former Financial Secretary to the Treasury referred to about 80 new proposals when he presented the "Lifting the Burden" White Paper last year.
This year the Paymaster General mentioned nearly 80 new proposals. Can he clarify whether those 80 proposals 556 are different proposals? If so, how many of last year's 80 proposals were carried into effect? Does he also recall that last year it was said that cutting red tape and ending form-filling would create some 8,000 jobs? Will he tell the House how many jobs were really created? Does he appreciate that the Opposition would welcome proposals from the Paymaster General or his noble Friend the Secretary of State for Employment which would begin to reduce the appalling dole queues rather than glossy documents, empty words and rhetoric?
§ Mr. Clarke
Like me, the hon. Gentleman has served time in the Whips Office. He also probably knows more about the procedures of this House than about the procedures in another place. The statement on "Building Businesses — Not Barriers" was made by Cabinet Ministers in each House. The Lords took the statement, made by the Secretary of State for Employment, at the time that they always take statements, after questions when sitting in the morning. The statement on defence matters will be made by my right hon. Friend the Minister of State for the Armed Forces who is sitting beside me. That statement will be repeated in the other place by a Minister who is not a Minister in that Department. The rules of the other place require the statement to be repeated. My right hon. Friend the Leader of the House has agreed that we shall look at all that, but the fact is that parliamentary procedure is responsible for where we are and it does not really feed the hon. Gentleman's main point.
On the £25 fee, the problem, which I hope the hon. Gentleman will accept, is that some cases which are going before industrial tribunals really should not be brought. At the moment, an individual can go to an industrial tribunal at no cost to himself and at the very least he will impose considerable costs on his employer simply by raising the complaint, and cause considerable public expenditure while ACAS and the tribunal system deal with it.
We have deliberately avoided anything that would cut people off from access to justice or be punitive in that way. The £25 fee will be returnable in most cases, but at least it might cause people to reflect before they casually make a complaint to an industrial tribunal, and thus leave tribunals freer to get on with the important cases that they have before them.
The part of the White Paper that relates to the hon. Gentleman's last point is only one of many policies in our Department. We are engaging in other inititatives which he and I will have many other opportunities to discuss. However, the fact is that since the spring of 1983 we have seen the creation of 985,000 — nearly 1 million — additional new jobs in the British economy. That has arisen because the British economy is expanding and because it is being made freer and more flexible in the operation of its labour market. That process must continue, and the White Paper is a small but important part of that.