§ Motion made, and Question proposed, That this House do now adjourn.—[Mr. Patnick.]
12.13 am§ Mr. D. N. Campbell-Savours (Workington)Industrial tribunals were originally set up to provide a procedure that was easily accessible, informal, speedy and inexpensive. In short, they are meant to provide cheap and easily understandable justice for workers wronged by employers. Unfortunately, the Government seem to have decided to run them down and to deny working people that justice.
Last year, applications to industrial tribunals increased by 10 per cent. This year, the increase is 32 per cent. That is not surprising, and it must be remembered that the vast majority of cases involve unfair dismissal claims—workers seeking compensation for dismissal or pursuing an employer for wages and redundancy money owed. A minority of cases concern sex or race discrimination and claims for equal pay. Thus it is hardly surprising that, as we enter a recession caused by the Government's economic incompetence, the caseloads should increase.
Why, in the light of that increased demand, did the Government set this year's budget allocation on the entirely unrealistic assumption that applications for cases would remain constant? Indeed, the Government's Employment Act 1990 creates the likelihood of some complex new claims arising out of the new law on refusal of employment on the grounds of union or non-union membership. It therefore clearly follows that, because of their own legislation, the Government are likely to have increased caseloads, yet they have allocated only a 3 per cent. increase in funding for the year. It is a familiar story of Government funding taking no account of demand for the service.
As a result of these inadequate allocations, the president of the industrial tribunals, Judge Sir David West-Russell, recently instructed regions which had overspent—that is all of them, except Nottingham—not to use part-time chairmen except in an emergency. As 40 per cent. of all cases are heard by part-time chairmen, we therefore face the prospect of a large backlog building up and those workers seeking justice facing the prospect of lengthy waits before their case is even taken to a first hearing.
Backlogs are currently worse in some areas than others. For example, although in my area there are currently few problems, in Southampton there has been a 40 per cent. reduction in workload which is expected to result in backlogs of six to 12 months for cases awaiting a first hearing. This horrendous prospect of delay will face the north-west region—my region—in due course, as it now faces Southampton. It will not be long before hon. Members throughout the north-west of England will begin to pick up cases and have to make representations to Government. It is merely a matter of time. How can the Minister reconcile the Government's action with the target set by the Department of Employment that 60 per cent. of applications should be heard within 12 weeks?
As you know, Mr. Deputy Speaker, I am sponsored by the Confederation of Health Service Employees, and I should make it clear that I receive no payments from that union, nor do I receive any out-of-pocket expenses. My union is extremely worried about these developments.
991 Let me give two examples involving health service workers who have been badly affected by the Government's penny-pinching. Enderby v. Frenchay health authority and the Secretary of State for Social Services is an equal value claim involving speech therapists. It commenced in February 1986. The case had made its way to the employment appeals tribunal by February 1989, where it has been held up, despite appeals by my hon. Friend the Member for Barking (Ms. Richardson) and the solicitors involved. Both were told that the delay was caused by insufficient funding of the employment appeals tribunal. Indeed, I am told that a delay of 15 to 18 months on appeal to the tribunal is not uncommon.
The other case concerns race discrimination. What has happened here will, I suspect, be an all-too-familiar story unless the Government fund the industrial tribunals adequately. This case was lodged with the London North industrial tribunal in April 1990 and listed for hearing in October. The night before the hearing the regional office of the industrial tribunals sent the following letter:
I apologise for the late cancellation of your case. I write to explain the position.In this Region there is now unavoidable delay between the time that the Originating Application is received and the date of hearing. There are two main reasons for this:I wonder how the Minister can justify the sending of such correspondence. It is clearly an invasion of civil liberties. He may care to refer to that case when he replies, although I was not able to give him notice of it when I spoke to him today.
- (1) In its budget for the current year the Region has insufficient funds to set up enough Tribunals to deal with the cases which are ready for hearing; in particular, I have been formally directed to restrict the use of part-time Chairmen. Therefore I have to limit the number of cases listed for hearing on any particular day to a number which can be dealt with by the full-time Chairmen but allowing for the possibility of pre-hearing settlements.
- (2) There has been an increase in the number of applications to the Tribunals without a corresponding increase in funds for additional administrative staff to deal with the added workload. Therefore it takes longer for cases to be made ready for hearing.
- (3) In addition to the problem of delay, it is sometimes necessary to cancel listed cases at very short notice. This occurs when there are fewer pre-hearing settlements than expected, and there is no Tribunal available to hear the case. In those circumstances, because of lack of funds, I cannot arrange for a part-time Chairman and additional Members to hear it … I apologise to the parties for the delay and inconvenience caused to them. You will understand that the circumstances are wholly beyond my control."
The TUC was also extremely worried about the underfunding of tribunals and made representations to the Secretary of State for Employment. Even he admitted that there was a problem, and allocated an extra £500,000 this year. However, the president of the Industrial Tribunals for England and Wales, Judge Sir David West-Russell, expressed the view that £500,000 was inadequate. On 19 October, he wrote to Norman Willis, general secretary of the TUC:
I was naturally pleased that the Employment Department has been able to allocate an additional £500,000 to the Tribunal budget although this must be set against an overspend of £375,000 during the first six months of the current financial year. I am advised by the Secretary of Tribunals that, in the circumstances, we shall need more than this amount if we are to function normally for the remainder 992 of the year. I am therefore continuing to press the Department for further funds in order to ensure that the resumption of full listing procedures can be maintained on a permanent basis.The question is, will the Government respond positively to such pleas aswe shall need more than this amount if we are to function normally for the remainder of the year"?In another letter to Norman Willis, the Secretary of State for Employment also raised the problem. Replying to a letter from Mr. Willis, he wrote:The fact is that unlimited funds do not exist for the industrial tribunals any more than they do for any other activity financed by the public purse. That is why the President of the Industrial Tribunals in England and Wales, as a temporary measure, has asked regions which are overspent against their budget to use part-time chairmen for emergency cover only. It is inevitable that for the time being some people may have to wait a little longer for their cases to be heard. Of course I regret this. However, this temporary inconvenience must be set against the paramount need to control public expenditure across the board, which is a prime objective of Government. If we did not succeed in this, the consequences for the economy, and therefore for every one of us, would be very much more serious.That letter contains an admission that delays exist—a letter in the hand of the Secretary of State. It is all very well for him to view such delays as unfortunate. For the individual workers involved, they can be disastrous. First, the wait is not "a little longer", as the Secretary of State has claimed; in some cases it is a year, 18 months or even longer. Moreover, the delays are likely to worsen without adequate funding of the tribunals. Secondly, in a case of unfair dismissal, a longer delay between dismissal and the hearing will reduce even the slim chance that reinstatement can be won and leave the victim without a job and any compensation, or the prospect of receiving any compensation within a sensible period.Mr. M. A. Rick, the regional chairman of the Southampton tribunal, is of the opinion that delays will lead to higher awards because tribunals will have direct evidence of financial loss between dismissal and the tribunal's decision when it is finally made. That could lead to longer hearings as arguments about what mitigating steps applicants have taken will become more frequent and more complex. We have moved a long way from the quick and cheap justice that the tribunal system was established to provide.
I shall suggest where the necessary extra funds could he found. Last year, 31,956 people applied to industrial tribunals, and the budget was £9.92 million. In the same period, a mere 324 people contacted the so-called Commissioner for the Rights of Trade Union Members, whose job is to advise trade union members on how to sue their unions. I am sure that the Minister played a notable part in advancing arguments and impressing upon the Government the need to set up that organisation, judging by his reputation.
§ The Parliamentary Under-Secretary of State for Employment (Mr. Eric Forth)The hon. Gentleman is besmirching me.
§ Mr. Campbell-SavoursHardly.
Only 70 per cent. of the 324 cases were relevant to the commissioner's duties and only one case ended up in court. The Government allocated £1.3 million to that office and the commissioner managed to spend only one fifth of that sum. Yet the same allocation has been made for this financial year. It is clear that a great deal of money is being wasted in that area. Some even argue that the organisation 993 has no work and that valid cases are not coming forward. It seems that malcontents and troublemakers are wasting taxpayers' money. Perhaps it is a matter that the National Audit Office should be asked to examine. Even the Public Accounts Committee might wish to undertake an inquiry. It seems that the demand for industrial tribunals far outweighs the almost completely unused and unwanted service of the so-called commissioner. I suggest to the commissioner that she should shut up shop. Why do not the Government abolish the pointless office and use the considerable sum saved to ease the funding crisis that faces industrial tribunals? Is it the Government's priority to spend their time bashing campaigning unions which wish to defend the rights of their members while cutting the funds of tribunals that the same trade unions want to use in the defence of their memberships?
The Secretary of State defended the proposed introduction of pre-hearing reviews and deposit orders following the expression of concern of the TUC's general secretary in his letter to the right hon. Gentleman. The Secretary of State explained that the proposals were designed to
weed out ill-founded cases.There must be a genuine concern, however, that the system would place an unreasonable element of doubt in the minds of any applicants who felt worried about their chances before a tribunal. It could even discourage them from making use of a tribunal regardless of the merits of their case.What comments does the Minister have about that? If consistency in government is the name of the game, can he explain, given the failure rate of the Commissioner for the Rights of Trade Union Members, why the system of deposit orders is not extended to those who attempt to take cases against their own unions? Surely such orders should apply to both or neither. These are important issues in the classless society that the new Prime Minister believes that he can create before the end of the century. Natural justice must surely be of paramount importance.
§ The Parliamentary Under-Secretary of State for Employment (Mr. Eric Forth)I am grateful to the hon. Member for Workington (Mr. Campbell-Savours) for raising this important matter. I share the concern that he expressed about recent delays in industrial tribunal hearings. I welcome the opportunity to make it clear that the Government have taken steps to ensure that the industrial tribunals can continue to operate effectively and that delays are kept to a minimum.
It is obviously in the interests of all concerned—applicant, respondent and tribunal itself—for cases to come to a hearing quickly. That is why, as the hon. Gentleman said, the tribunals have as their target that 60 per cent. of cases should come to a first hearing within 12 weeks of the original application. The hon. Gentleman will recognise that this target represents a much faster performance than the ordinary courts normally achieve. That is why the industrial tribunals are so helpful in sorting out individual industrial relations problems. They can and do produce a quick solution to a problem which 994 is usually acceptable to both parties. I pay tribute to their work, day in, day out, in quietly sorting out problems and avoiding damaging disputes.
Perhaps I could now sketch in the background to the recent problems which the hon. Gentleman has rightly raised. They arose because of the great and unexpected surge in the number of applications to industrial tribunals in England and Wales over the past 12 months or so. I do not want to get bogged down in statistics, but I must give a few figures to illustrate the problem that we face.
From 1981 up to the 1988–89 financial year, the number of applications fell in every year except one. In 1981, there were just over 40,000 applications. In the financial year 1987–88, there were fewer than 27,000 and in the following year the number of applications fell still further to just over 26,000. In other words, there was a significant and sustained long-term downward trend. Some of this reduction, but by no means all, was, of course, due to the fact that in 1985 we increased the qualifying period for making applications from one year to two years. But even allowing for that change in the law, the caseload was obviously falling significantly.
A few months into the financial year 1989–90, this long-term downward trend was reversed and the number of applications started to rise. By the end of that financial year—1989–90—the annual total had reached over 31,000 applications, a rise of 20 per cent. In the present financial year—1990–91—the number of applications has continued to rise substantially. Up to the end of October, there had already been over 21,000 applications, and on present trends the annual total will have risen to about 37,000 by the end of this financial year. That amounts to a further increase of 20 per cent. over last year, which itself showed an increase of 20 per cent. over the previous year.
The reason for this sudden increase are still not entirely clear—certainly not to us. Part of the increase, especially in 1989–90, is due to an unexpectedly high number of applications under the Wages Act 1986. But that is far from the whole story. The great bulk of tribunal applications—around 70 per cent.—concern unfair dismissal and redundancy payments. Applications under these jurisdictions have also increased substantially.
In the light of that, I turn now to the budgetary matters that the hon. Gentleman rightly raised. This year's budget for the Industrial Tribunals was, of course, drawn up in early 1988 when the caseload was around 26,000 and still falling. Earlier this summer, it became clear to the president of the Industrial Tribunals for England and Wales that, if the present trend of applications continued, the tribunal budget for 1990–91 would be overspent.
The president therefore very properly decided that to keep within their budgets the tribunals must cut their use of part-time chairmen, who are paid a daily fee for their work. I should emphasise that this was the president's decision—not, as I think the hon. Gentleman may have suggested, the Government's. That is how it should be. It was not for the Government to tell the industrial tribunals how to ensure that they keep within their budget. That is and remains very properly a matter for the president.
The president of the industrial tribunals therefore told the industrial tribunal regional offices on 7 August that part-time chairmen were to be used only in emergencies. That was not an easy decision to take. It was clearly going to cause delays, since, on average, part-time chairmen hear a quarter of all cases. It was also clear that it would 995 seriously affect performance in relation to the targets which I mentioned earlier and to which the hon. Gentleman referred.
But in my view it was a responsible and correct decision. Perhaps at this point I can pay tribute to the president of the Industrial Tribunals for England and Wales, His Honour Judge Sir David West-Russell. Sir David will retire at the end of the year having spent more than six years as president. He has been an excellent president and a tonic for the industrial tribunal system generally. We are sorry to see him go, but we look forward equally to working with his successor, Judge Timothy Lawrence.
§ Mr. Campbell-SavoursHow can the Government possibly blame that gentleman for taking the decision that he had to take because the Government refused to give him adequate resources to ensure that everyone had a hearing within the target date? It was the responsibility not of that gentleman but of Government. I want to hear in the Minister's speech a commitment that all cases will be heard within the target time and that money will be made available to ensure just that.
§ Mr. ForthI regret the hon. Gentleman's use of the word "blame". I tried to make clear that it was the responsibility of the president—which he correctly discharged—to ensure that, within the resources available at the time, correct decisions were made about how to administer the system. That was done. I shall come in a moment to the present position in response to what the hon. Gentleman said. I want to put it clearly on record that I do not accept the use of the term "blame". I have acknowledged that the president correctly discharged his responsibilities.
The decision to cut the part-time chairmen attracted some publicity, to which the hon. Gentleman referred. He also referred to the TUC's concern and the fact that there was an exchange of letters on the subject between Norman Willis, the general secretary of the TUC, and my right hon. and learned Friend the Secretary of State.
The hon. Gentleman also referred to the difficulties caused by this decision and to the large number of NHS cases before industrial tribunals. He acknowledged his special interest in NHS matters. I do not deny those difficulties for one moment. Nor do I deny the difficulties in Southampton. They arose with particular acuteness in Southampton because that region makes more use of part-time chairmen to hear cases than do most other parts of the country. I know that the regional chairman in Southampton was especially worried about the situation.
But I am happy to tell the hon. Gentleman that those problems are now substantially over. At the same time as he took his decision about the use of part-time chairmen, the president naturally approached the Department of Employment to see whether additional funds could be made available to the tribunals. After careful consideration, the Government decided to make further funds available to the tribunals so that they could operate normally for the rest of the year. Those extra funds—amounting in total to some £750,000—have now been allocated. The hon. Gentleman will be pleased to hear that that has enabled the president of the 996 industrial tribunals to review his decision about the use of part-time chairmen. He has decided—it is his decision—that it will be possible to use them again for hearings in the normal way. The tribunal regional offices were therefore told on 9 November that they could return to normal working.
§ Mr. Campbell-SavoursMay I take it, therefore, that no longer will there be problems of backlogs, that any backlogs will be cleared and that perhaps from some date in the next few months all cases will be heard within the target date that the Government have set for the hearing of such cases?
§ Mr. ForthI can certainly say that the resources now available to the tribunals are adequate for their needs and that the president is satisfied that the work of the tribunals can continue in the way that he would desire. The additional resources to which I referred are adequate to the needs of the moment. I shall come on to the future in a minute.
The main issue that we must explore is the need to make better and more effective forecasts of industrial tribunal applications—that is from where our difficulties have stemmed. As I tried to suggest, such forecasting is notoriously difficult. I doubt whether we can come up with anything that carried any certainty, but it is important to try to achieve it. Given the hon. Gentleman's interest in the matter, I should be happy to consider any suggestions that he has for making forecasting more effective in the current circumstances. I do not want the problems to recur.
I cannot say anything definite about next year's budget—because final decisions have yet to be reached about the detailed allocation resulting from the recent public expenditure settlement that my right hon. Friend the Prime Minister announced when he was Chancellor.
I believe that the concept of industrial tribunals as inexpensive, speedy and informal dispensers of justice is important. I want to do all that we can to preserve that concept. I am therefore grateful to the hon. Gentleman for raising this matter and for giving me the chance to put on record the response that the Government have been able to make to the difficulties that arose.
§ Mr. Campbell-SavoursCan the Minister assure me that he will keep under permanent review whether target dates are met in terms of hearings held in the target period? Will he ask for a report every three months from the chairmen? If at any time it appears likely that, due to increasing caseloads, a backlog may develop again, will he use his best endeavours to ensure that moneys are made available?
§ Mr. ForthGiven the lessons that we have learnt about the forecasting system and its inadequacies, and the experience gained from the president, I assure the hon. Gentleman that we are reviewing all the relevant parameters. We are attempting to ensure as best we can, within the limitations of the budgeting and forecasting system with which the Government are inevitably involved, that the problems will not recur. We are working closely with the president to ensure that the system works effectively.
997 We believe in the system of tribunals and we want to make them work properly. I am grateful to the hon. Gentleman for raising this matter again and strengthening my hand to deal with it as effectively as possible. I hope 998 that he will accept that we are approaching it in the most positive manner. Tonight's debate will benefit the system of tribunals that we both value so highly because of the contribution that they make.
§ Question put and agreed to.
§ Adjourned accordingly at eighteen minutes to One o'clock.