European Union: Acquired Rights Directive (Hansard, 2 March 1995)

§ Lord Inglewood
My Lords, Ministers and government officials have had a number of constructive discussions with representatives of other member states, both before and after the publication by the European Commission in September last year of its proposal to repeal the 1977 acquired rights directive and to replace it by a new one. Those discussions have been aimed at securing agreement on the scope of the directive, not on reducing the rights provided where it applies.

§ Lord Harris of Greenwich
My Lords, I thank the noble Lord for that reply. Does he not agree that it is 1584 more than mildly ironic that at a time when there is such substantial public concern about the pay settlements for directors of public utilities, a concern which has also been expressed by the Prime Minister, the Government are applying their minds to trying to reduce the employment prospects, wages and working conditions of people who are involved in market testing? Does that not seem wholly unacceptable?
Secondly, would the Minister like to comment on the letter which was published in the Financial Times on Tuesday of this week from Mr. Portillo, the Secretary of State, who said that the Government must avoid any public statements on this issue which would be reported to the Commission and others? Can the noble Lord explain why there is such a desire for secrecy by Ministers on this particular question? I am sure that the House will be extremely interested in his reply.

§ Lord Inglewood
My Lords, the noble Lord seems to have overlooked the fact that the purpose behind the move to contract out was to improve services and to reduce expenditure. That does not necessarily mean that overall jobs will be lost. On the contrary, jobs will be gained. In the past 12 months we have seen unemployment drop by something like 400,000.
The noble Lord referred to a piece in the Financial Times published earlier this week which makes certain suggestions about the manner in which the Government are conducting negotiations at European level. Needless to say we do not divulge the tactics which we employ in those negotiations. To do so would reduce the efficacy of our activities and as a result we might achieve a less good deal for the British people than we would otherwise manage to do.

§ Baroness Turner of Camden
My Lords, one can hardly open a newspaper without reading about yet another takeover in prospect—Dillons, not to mention Barings. Is it not deplorable that at a time of enormous insecurity in the labour market, the impression should be given that the Government seek to water down what already exists in the acquired rights directive? Should we not seek to strengthen those guarantees to workers in such situations? It is hardly surprising—is it not?—that in present circumstances there is no feelgood factor, because people are far too insecure.

§ Lord Inglewood
My Lords, it is important to bear in mind that the proposals to change the acquired rights directive emanate from the European Commission. The European Commission believes that the present legislation is inappropriate, not merely because it is badly drafted—I am sure that the House will agree on that—but also because the way in which it is interpreted by the European Court of Justice goes far beyond the intention at the time that it came into effect in 1977. Experts have been called in by the Commission. The balance of opinion is that it is appropriate to reduce its scope. We on these Benches also share that view. That is why we support the European Commission in its endeavours.

§ Lord Harris of Greenwich
My Lords, the noble Lord has been very helpful on this Question this afternoon. I ask him to recall another phrase from the letter of Mr. Portillo, which states, There is undoubtedly some suspicion of the UK's motives". He indicates that there would be real danger if it were thought that the United Kingdom was the leading member state which wanted revision of the acquired rights directive. Is that not an extraordinarily interesting indication of the Government's position on general European issues?
Quite apart from that, does the noble Lord also agree that the reduction of unemployment to which he referred has absolutely nothing to do with the acquired rights directive, which is still in existence? There could not have been the remotest relationship between the acquired rights directive and the reduction of unemployment.

§ Lord Inglewood
My Lords, as I explained in an earlier answer, it is not the Government's policy to elaborate on the tactics that they are adopting in European negotiations. The noble Lord refers to the article in the Financial Times. I do not propose to comment further on it.
On the specific points he makes about the acquired rights directive, the important point is this. We believe that the policy contained in the directive is not in the best interests of this country. That is why we wish to see the scope of the legislation reduced. We take the view that the directive is not appropriate because we believe that the approach to labour market flexibility which we have adopted in this country—it is to some extent at variance with the approach shared elsewhere in the European Union—is in our people's interest and has led to the decrease in unemployment.

§ Lord Stoddart of Swindon
My Lords, will the noble Lord remind me as to whether a change in the directive will be achieved by a qualified majority vote or does the change require unanimity? If the former, will he state what other countries support the British Government's position?

§ Lord Inglewood
My Lords, the proposal is brought forward under Article 100 of the treaty, which requires unanimity. We believe that there is a very good chance of this proposal proceeding.

§ Lord Elton
My Lords, does not the intervention of the noble Baroness, Lady Turner of Camden, nicely illustrate the reason why the feelgood factor is elusive? The reason is that politicians so often refer to closures and danger, and never to such factors as the greatest reduction in unemployment for many decades and the fact that employment in manufacturing is going up for the first time since the last war.

§ Lord Inglewood
My Lords, my noble friend makes a pertinent comment. The feelgood factor depends upon a successful economy; and our economy is becoming more successful every day.