HC Deb 11 December 1980 vol 995 cc417-8W
Mr. Ernie Ross

asked the Secretary of State for Employment if he will extend the length of time of assistance under the temporary short-term working compensation scheme from nine months to 12 months in special development areas.

Mr. Jim Lester

In his statement about the Government's special employment measures on 21 November, my right hon. Friend announced that the maximum period of support under the temporary short-time working compensation scheme would be extended to nine months. This is to be financed by cutting the rate of reimbursement from 75 per cent. to 50 per cent. of normal pay for workless days. We have to strike a balance between the needs of industry and what the country can afford and I can see no prospect of our being able to extend the scheme further in 1981–82 in the way the hon. Member suggests.

Mr. Marlow

asked the Secretary of State for Employment whether firms of under 10 employees can benefit from the temporary short-time working compensation scheme or any similar scheme.

Mr. Jim Lester

[pursuant to his reply, 4 December 1980]: I regret that firms with fewer than 10 employees are unable to benefit under the TSTWC scheme. The scheme is designed to enable employers to keep together a particular work force, which might be difficult to reassemble and there is a limit below which this argument ceases to have force. Moreover, the figure of 10 redundancies coincides with the requirement in the Employment Protection (Consolidation) Act that only redundancies affecting mere than 10 workers need be notified to this Department; this notification is used under the scheme as evidence that there is a real threat of redundancy.

Mr. Aspinwall

asked the Secretary of State for Employment if, in view of the fact that many smaller companies are unable to take advantage of the temporary short-time working scheme, he will seek to reduce the minimum threshold for qualification from the intention to make 10 more workers redundant to five or more; and if he will make a statement.

Mr. Jim Lester

[pursuant to his reply, 9 December 1980]: I have no plans at present to reduce the minimum threshold to enable companies with a potential number of redundancies of less than 10 to qualify for assistance under the temporary short-time working compensation (TSTWC) scheme.

I do not think it would be cost effective to reduce the threshold further. The scheme aims to avert redundancies, thus helping employers keep together a particular labour force which might be difficult to re-assemble, and there must be a limit below which this argument has force. Moreover, the figure of 10 redundancies coincides with the requirement in the Employment Protection Act 1975 that only companies faced with making 10 or more workers redundant need notify the redundancies to my Department; this notification is used under the scheme as evidence that there is a real threat of redundancy.

Mrs Renée Short

asked the Secretary of State for Employment (1) what representations he has received regarding the allocation on non-working days under the temporary short-time working compensation scheme; and if he will make a statement;

(2) if he will change the rules of the temporary short-time working compensation scheme to make it more flexible with regard to allocating non-working days in specific divisions of four—four and live weeks;

(3) what study he has made of the difficulties that are being caused to some firms by his Department's insistence that the allocation of non-working days under the temporary short-time working compensation scheme must be used in specific divisions of four—four and five weeks; and if he will make a statement.

Mr. Jim Lester

[pursuant to his reply, 8 December 1980]: I have received very few representations requesting a change to this ruling.

The temporary short-time working compensation scheme was designed essentially to provide support on a weekly basis and thus the maximum entitlement to support is expressed in terms of workless days per week. However, in order to allow firms some flexibility in regulating their work and also to allow them to work a week on—week off system of short-time working it was decided to allow firms to spread claims over a four or five-week period up to a maximum entitlement of four or five times the weekly maximum. For individual workers on short time, there has to be at least one normal day's work after a period of seven consecutive days without work.

There is also scope within the rules for firms which find their trading position deteriorating while claiming support to adjust this maximum entitlement by increasing the size of the redundancy group. Most have found the flexibility provided to be sufficient. I have no plans therefore to change this ruling.