Austin Mitchell
Main Page: Austin Mitchell (Labour - Great Grimsby)Enterprise and Regulatory Reform Bill
Austin Mitchell Excerpts
Austin Mitchell (Great Grimsby) (Lab)
It is always a pleasure to follow the hon. Member for Northampton South (Mr Binley), provided that one does not follow him too far down his idiosyncratic paths.
It is difficult to speak about the Bill, as it is very much a rag-bag of a Bill. I would say it was a curate’s egg of a Bill, if we could assume that curates ate pterodactyl eggs that were good in parts but monstrous in others. It is a very mixed bag and it looks to me as though the Secretary of State for Business, Innovation and Skills, who is, I think, the only wise man in Government—certainly in the Cabinet—has had a difficult fight beating off some of the more lunatic proposals that were put to him by Beecroft and others in the Conservative party. He has finished up with not a Bill but a bric-a-brac stall, with several bits that are very broken and others that are very messy.
We were told that the Bill is about growth—that it is about “encouraging long-term growth”—but that is completely crazy. Our economy is not growing because of the way in which the Government are handling it. They are obsessed with debt rather than the real problem with the British economy, which is demand. In an attempt to cut debt, they are cutting spending, firing public servants and reducing public spending, but those actions in turn are reducing demand with the result that we are acquiring more debt and that the burden of debt weighs more heavily on the shrinking economy. The economy was 4% below its GDP in 2008 and if we count the growth it should have had in the interim years, we can see that it is well below what it should be. Ours is the only economy in the world that has fallen that low, yet the Government are compounding the problem by trying to cut debt while widening the deficit, requiring more debt to pay the wages of misery and unemployment. That is an economic folly and what the Bill does to encourage growth is as nothing when set against that.
It is a deceit to pretend that business is hung down with regulations, tribunals and employment regulations, that that is the cause of the problems and that if we get rid of all the regulations and obligations to the workers, we will suddenly have a surge of energy and enterprise. That is absolutely not true. Workers in this country have less protection and fewer rights than those in nearly every other advanced country apart from two. Less protection, fewer rights. We have heard some tear-jerking examples today of small businesses being unable to fire people. I accept that there are some problems, but it is easier for such businesses to fire people than it is in most comparable countries. When multinationals want to reduce their international work force, they notoriously always fire people in this country first because it is easier and less expensive in redundancy payments. No surge in employment will come through concessions to small businesses in the form of regulation. Speakers from the Government Benches have been rather like the captain of the Titanic, locked in his cabin discussing how to reduce the conditions and pay of the stewards while the ships sinks with an iceberg making a great hole in it. That is the level of the debate on those Benches.
Let me look first at what the Bill does not do, because its inadequacies are more glaring than its adequacies. It offers a green investment bank—or, to give it its proper name, a pale green investment bank—that is not a bank and that is certainly too little, too late. It is much like the time when Michael Heseltine used to go around distressed towns in the north in the 1980s offering them a garden festival; the green investment bank is the Liberal party’s wreath from Government. What we really need is not a green investment bank with very little money at its disposal but a national investment bank that will raise money on the markets—it could use some of the proceeds from quantitative easing, too—and invest it in business, in housing projects and in infrastructure projects to get the economy moving.
Austin Mitchell
No, I want to be very brief.
We are being offered a marginal increase in shareholder rights when what we need is an increase in worker rights and worker representation, particularly representation. Workers are the ones with the interests of the company at heart and they want to see the company maintained, viable and healthy. Workers, as well as shareholders, should be represented on the remuneration committee, on the audit committee, which should have a central role, and on works councils, such as those that they have in Germany. I would move rapidly towards the Mitbestimmung system of co-determination and partnership that they have in Germany. The Bill does not do that, which is a failure. It offers a simplified structure for competition issues when what we need is a British version of the Securities and Exchange Commission in the United States and a business commission to enforce effective corporate governance of British companies and to impose tougher rules on mergers and foreign takeovers.
As Alex Brummer shows in his latest book, we have very few national champions left in this country and a higher proportion of our big firms have been taken over by foreign firms than in any other country. That means that they are dancing to a tune dictated from Zurich, Hamburg, Delaware or wherever else rather than to a British tune when making their investment decisions. We need to check and control foreign takeovers on that stage.
Let me make a brief mention of what the Bill does; it has to be brief, because it does not do all that much. First, the simplification of the tribunal process is okay and acceptable, provided that ACAS gets the extra staffing and money that it will need to take over the conciliation process before industrial tribunal. Secondly, we need a one-track approach, rather than having to go first to ACAS and then to the tribunal. The approach should be integrated down one track.
We need better protection and provision for whistleblowers. In many cases, that is the only way we will find out what is going on inside companies such as A4e—we heard all the revelations about what that company had been doing because they do not have an adequate audit structure or control structure. That means that fraud can be perpetrated at the lower levels, whereas the top management is not concerned and does not want to know what is going on. We need proper control structures and some system of strengthening and protecting whistleblowers to encourage them to come forward and reveal what kind of business practices are going on. If the Bill does not provide that, it will fail. Those are important provisions that must be implemented.
