Kevin Hollinrake
MP for Thirsk and Malton · Conservative · United Kingdom
“That issue is one of the many things that the people who signed the petition are concerned about, Dr Huq. One of the big things that the Government promised, which I agree with them about, is the need to encourage faster growth in our economy. Of course that is right, but look at where that growth is.”
“The UK economy went through many challenges, of course, some of them caused by Brexit; the reality is that a change like that was bound to have a short-term effect—but only a short-term effect. The country grew faster than Germany and France during that period of time.”
“As I said before, governing is not easy; we had many challenges ourselves, and we did not get everything right, but what we did during that difficult period of time—those 14 years—was get 1.2 million more people employed in our economy. Unemployment was halved during our time in office.”
“Of course, many Government Members supported his leadership challenge. We are here now, looking forward to a general election coming down the track. We are ready for a general election when the Government are, because, unlike them, we have a strong leader—against their weak leader.”
“I was, absolutely. I thank my hon. Friend the Member for Berwickshire, Roxburgh and Selkirk (John Lamont) for his excellent opening speech. He made so many good points, not least about the level of support for this petition.”
“Members on the Government side of the House also feel betrayed and angry with their own leadership, for marching them up to the top of the hill and marching them back down again on many of these issues, but they do not feel as betrayed as the businesspeople in this country in particular.”
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“My hon. Friend is absolutely right. I understand that 90,000 pupils will be transferring to the state sector as a result of these plans. We Conservatives hold firmly to the principle that education should not be taxed. The only other nation to have tried is Greece, which abandoned the policy within months because of the disastrous consequences. The Independent Schools Council has said that some independent schools will close entirely and others will scale back the education they offer, causing significant upheaval and disruption to the lives of tens of thousands of children. As surely as night follows day, that will mean fewer children going to private schools and increased pressure on state schools.”
“The Minister talks about the transition. I talked to my farmers in Bedale on Friday, and the only transition they can see is the transition from family farms to the state. Does he realise that the farming industry is one of the least profitable sectors in the country? The return on capital employed is 0.5%—that is the Government’s own figure—and that is around a 20th of the typical profit margin in the UK. Other than by some warped socialist ideology, how can he justify taking away 40 years of profits for the typical farmer?”
“If Labour Members going back to their seat this weekend were thinking of going to a local pub for a pint and a chat with local farmers, I would think again. A publican with a mid-sized pub contacted me last night to say that because of yesterday’s changes, he would be £120,000 a year worse off, moving him from profit to loss. Labour said that its plans were fully costed and fully funded. Yesterday was a massive broken promise, was it not?”
“The Government’s choice was to hit businesses, and that is because there is not an ounce of business experience among them. Labour’s death taxes will hit farms and businesses. Families with a typical farm will have to find hundreds of thousands of pounds or see their farms broken up and sold. The Environment Secretary said 10 months ago that he had no intentions of putting death taxes on businesses. That was a broken promise, was it not?”
“As Winston Churchill put it, they are the strong horse that pulls the whole cart. The question I now ask myself is whether I would start that small business again today if the Bill were in place. Sadly, the answer is probably no—certainly not a business that employed any people. The very high cost of these measures will be borne by all companies and passed on in the form of higher prices, reduced wages and lost jobs. The measures will fall most heavily on small businesses, for which they could be existential.”
“Those who have done so are the first to appreciate the symbiotic relationship between the two. We acted during our time in office to improve workers’ rights in several areas: flexible working, parental leave, redundancy protections, ensuring that workers keep the tips left for them by their customers, and significant increases to the national living wage. I started my first significant business back in 1992. Over three decades, we grew to become a national business employing hundreds of people. We valued every one of those people. We were one of The Sunday Times ’s best 100 companies to work for and were certified by Investors in People. I believe that business is a force for good and that businesspeople do great service to our communities and the wider economy.”
“I beg to move an amendment, to leave out from “That” to the end of the Question and add: “this House notes the balanced reforms made by previous Conservative governments to improve workers’ rights, including the National Living Wage, the prohibition of the use of exclusivity clauses or terms in zero hours contracts and the introduction of shared parental leave and pay, and declines to give a Second Reading to the Employment Rights Bill because it has been rushed into Parliament without full consultation to meet an arbitrary 100-day deadline and Monday 21 October 2024 Business Today: Chamber 19 has not been accompanied by an Impact Assessment considering the impact on the Employment Tribunal, especially as a result of the removal of the qualifying period for the right to claim unfair dismissal or the impact of the extra red tape on SMEs or the impact of establishing the Fair Work Agency; because the repeal of trade union laws will lead to more strikes and intimidation in the workplace, and will force taxpayers to foot the bill for inflation-busting pay hikes without public service reform; because the Bill undermines choice for workers about whether they want to fund political campaigning and forces firms and public bodies to bankroll more trade union facility time, including trade union diversity jobs; and because the Bill is contrary to the Government’s stated goals of improving productivity and economic growth and will increase costs for businesses and consumers.” The Conservative party will always be the party of business, but we are pro-business and pro-worker, not least because many Conservative Members have been both workers and people who have started and grown their own businesses.”
“As one business organisation put it, “You lose when you are accused.” Most small businesses saddled with such a cost would be sunk without trace. It is not just that, but the deterrent effect, which it would have had on me, and which will be felt right across the economy and by every existing and aspirant business person across this entire nation. When the Deputy Prime Minister reflects on what she is hearing from people who have actually run a business, will she at the very least consider exempting small and medium enterprises from this catastrophic Bill?”
“I was not here at the time, but it is clear nevertheless that the minimum wage and the national living wage have had a positive effect on prosperity in this country, and I would be the first to admit it. I want the hon. Lady, and other Government Members, to understand that those measures fell equally on all businesses across the UK. The measures in this Bill fall disproportionately hard on small businesses. What the right hon. Member for Ashton-under-Lyne (Angela Rayner) fails to understand is that the implication of these measures, such as a day one right to an employment tribunal, is that even a spurious case of unfair dismissal costs time and money. It is potentially tens of thousands of pounds to defend that case.”
“As drafted, that is certainly the case. My right hon. Friend is absolutely right. Members may not know that small businesses stand the cost of statutory sick pay. It is not reimbursed by the Government, so the Bill would have a significant cost for businesses.”
“The point I was making is that the case may go all the way to an employment tribunal, as the hon. Gentleman knows, but there would also be the cost of defending the case even if it does not. That small business will have to bring consultants in and will have to speak to lawyers. That itself costs money, and in many cases that will be thousands of pounds. That is what the hon. Member fails to understand: when you are accused, you lose.”
“The word “uncertain” appears 302 times in those impact assessments, and the word “risk” is used 432 times, so the cost is likely to be much more.”
“No, I will make a little progress. The cost of all these measures—in individual opportunities and to the wider economy—is huge. The Government may try to deny that, despite their clear lack of experience of the real world of business. It is extremely alarming that not one of those on the Front Bench today have ever started or run a business that employed anyone. Even worse than that, only one member of the Cabinet has ever done so, and that is the Secretary of State for Scotland. Shamefully, given what is at stake, the Government cannot deny our case that the Bill will have a huge economic cost, because today—finally, two hours before this debate—they have actually produced the impact assessments. The cost of the Bill is on the very first page: up to £5 billion per annum.”
“I am not a trade union member, and I would not know about my colleagues, but I started a business, as did my hon. Friend the Member for South Suffolk (James Cartlidge), as did the shadow Chancellor and as did many others in our party. We are proud of that fact. This morning I met business representatives covering all parts of the British economy. Like us, they have serious reservations about this Bill. The Institute of Directors highlighted the fact that 57% of its members will be less likely to hire staff, with only 2% saying that would be more likely. The Confederation of British Industry said that the costs associated with this Bill cannot be afforded by 54% of businesses.”
“I agree. I was interested that the Deputy Prime Minister said that her menopause measures would be exclusive to large businesses. I welcome that, and I ask her to look at attaching the same conditions, ideally, to the entire Bill, but if not to certain parts of it. The risks for small businesses are simply catastrophic. Even one or two cases could completely sink a business.”
“My hon. Friend is right. This morning we met representatives from UKHospitality, who said exactly that: the Bill is coming on the back of a number of changes and some difficult times during covid for industries that employ a lot of people, which will be particularly badly affected by this legislation. The Government should think twice about implementing it at this moment in time.”
“I agree. We should be low tax and low regulation. One of the saving graces of this legislation is the detail, although the Bill itself is light on detail: many of the measures will be brought in through secondary legislation, therefore making it easier for a future Government to reverse some of the catastrophic changes.”
“In their failed attempt to allays concerns about the Bill, the Deputy Prime Minister and the shadow Business Secretary have stated that they have consulted businesses—”
“I will make some progress. The Government’s own impact assessment acknowledges that the measures will mean price rises for consumers and job losses. In it, 40% of firms surveyed said that prices would go up, and 17% said that they will reduce the number of employees. That is hundreds of thousands of jobs at risk. The criticism of the Bill does not stop there. The Institute for Fiscal Studies has warned that it risks lower employment rates and lower wages for employees. The Local Government Chronicle has warned that the Bill will place financial pressure on councils. The Recruitment and Employment Confederation has said that the Bill will fuel long and complex litigation. The Financial Times has warned that the Bill is causing deep unease among business leaders. In short, jobs down, wages down and prices up.”
“Sorry, though I think the Prime Minister is guilty of similar; I do apologise. The Deputy Prime Minister and the Business Secretary have stated that they have consulted businesses. Really? The Federation of Small Businesses said not only that the Bill will “inevitably deter small employers from taking on new people”, but that it is a “rushed job, clumsy, chaotic and poorly planned” and that the Government are guilty of shallow engagement. So much for the “strong horse”. Several representatives at this morning’s meeting said that they have been talked to but not listened to—including those representing the hospitality and retails sectors some of the most labour-intensive in our economy, which is acknowledged in the impact assessment.”
“There are already 58,000 fewer payroll jobs than when Labour took office. Confidence levels at the Institute of Directors on future investment intentions have dropped from plus 30 in June to minus six today. The Government are planning 30 consultations on the measures in the Bill. They should have taken place before the Bill was introduced, so the legislation could be precise about what it will do.”
“Despite 100 days of gloom and doom, talking the economy down and wrecking business confidence, they managed it—just. The Government are not even listening to their own legal experts. Only last week the Attorney General said: “excessive reliance on delegated powers, Henry VIII clauses, or skeleton legislation, upsets the proper balance between Parliament and the executive.” Because the Bill is such a rushed job, it takes swathes of delegated powers, including Henry VIII powers, meaning the final policy will be decided later at the Secretary of State’s whim—not now by Parliament. Legislating that way is causing real concerns for businesses today. The Deputy Prime Minister and her colleagues preach stability, yet in the same breath they are causing instability, uncertainty and falling confidence at a cost of jobs and investment today.”
“My right hon. Friend is absolutely right. There speaks somebody who has actually run a business and understands the impact on a small employer. That is why we say there should be a carve-out, certainly for small and micro businesses. We have to ask ourselves this: if the Government are not listening to businesses who “pull the whole cart”, who are they listening to? I think we all know the answer to that. A consultation is not five minutes inside No. 10 and a photo opportunity. Proper consultation is working with business, listening, taking your time and not rushing things—the exact opposite of what the Government have done. We know why that is. The Deputy Prime Minister made a misguided promise to Labour’s trade union paymasters that legislation would be introduced within 100 days.”
“My hon. Friend makes a strong point. That certainly needs looking at very carefully. As the Government’s attempt at business consultation has clearly failed, and as no one on their Front Bench has any business experience, I will draw the right hon. Lady a picture of what the Bill actually means for businesses.”
“They will have to deal with a new right to demand flexible working, such as a four-day week. The right hon. Member for Islington North (Jeremy Corbyn) must be proud. Businesses will have to become the free speech police to prevent any of their customers offending their staff. They will have to deal with a new regulator, the fair work agency, which will have the power to enter any business premises, confiscate documents and levy fines—all backed up by new criminal offences with penalties of up to two years in jail.”
“I welcome the fact that there is at least some business experience on the Government Benches. Perhaps the hon. Gentleman joined the wrong party. The hon. Gentleman will recognise the picture of what the Bill means for businesses. They will be terrified to take new people on for fear of huge compliance costs and legal action. They will be tied up in red tape, something that the Prime Minister said he was taking an axe to. They will have to cope with measures such as the need to frequently recalculate all workers’ hours for each reference period for each separate employee, each of which will have a unique date as they will be required to proactively offer guaranteed hours. This is not even restricted to those on zero-hours contracts. It will be for anyone on low hours—a bureaucratic nightmare.”
“[Interruption.] That is what the Government’s impact assessments say. Labour Members should check their impact assessments. 1970s, here we come! There is much more, but in short, it all means that the tail will be wagging the dog.”
“That is not what my right hon. Friend said at all. I worked with her when she was Business Secretary, and at no point did she ever say that about maternity pay. She was talking about regulation costs. She was simply pointing out that for many businesses, particularly in retail and hospitality, the rise in the national living wage has been very difficult to cope with. She was not talking about abolishing it. Businesses will have to deal with new union powers to gain access to any business premises and contact its staff—wonderful!—in order to recruit and organise members and make it much, much easier for a union to gain recognition. As the impact assessments state—this is great news; this will really cheer everyone up—there will be “increased industrial action” and tax rises to pay for increased pay demands.”
“That will line Labour’s pockets with default donations from working people. This trade union charter will abolish the thresholds for strike action, unleashing waves of low-threshold strikes, and crippling public services by putting power in the hands of militant trade unions. This trade union charter will force employers to inform their staff that they can join a union at every turn. This trade union charter will reduce notice periods for strike action, meaning that businesses will be plagued by zero-warning strike action, which will unleash misery on the public at the last minute.”
“She declared her interests as a union member, but she did not declare her interests as someone who had taken £13,000 from unions in donations. The question of what is orderly is up to your judgment, Madam Deputy Speaker, but it seems to me that that should be declared at the start of any Member’s contribution. This is not an Employment Rights Bill, but a trade union charter—a charter that will bring about no-knock warrants that allow unions to access all business premises, from the local takeaway to the local pub. Clearly, shutting the beer gardens is not enough for this Government; they are now relying on strike action to stop you getting a pint. Under this trade union charter, trade unions will revert to requiring people to opt out of donating to unions’ political funds.”
“Sixteen Cabinet Ministers, including the Chancellor, the Foreign Secretary, the Home Secretary and the Energy Secretary, have hired people for roles that involve working outside regular hours and at weekends; six Cabinet Ministers have hired people to roles with extended probation periods; and seven Cabinet Ministers, including the Chief Secretary to the Treasury and the Deputy Prime Minister, have hired on “insecure” fixed-term contracts. Why would they introduce legislation that they do not understand or even comply with themselves? The answer is, of course, their union paymasters. Much like the more than 200 Labour MPs who have taken trade union cash, the Deputy Prime Minister has her donations to think of.”
“I am very concerned about that. Today there are 4 million more jobs in our economy than there were in 2010, and 1.2 million fewer people are unemployed. I am very worried about the things that my hon. Friend is very worried about. Making work pay is a laudable aim, but as one stakeholder put it this morning, “work doesn’t pay if there’s no work”. Most people recognise that one of the reasons why the UK is the third most popular destination in the world for inward investment, which creates hundreds of thousands of jobs throughout the economy, is the flexible labour market that the Government are now seeking to eliminate. Do the Deputy Prime Minister and her Cabinet colleagues realise that? Perhaps they secretly do, given that nine out of 10 of those Cabinet colleagues recruit on terms that are at odds with these new regulations.”
“At a time when the Government claim to be scrambling for cash and are taking the winter fuel payment from 9.5 million pensioners, they have the gall to drive up taxes to reward their trade union paymasters. That will be done not just through higher national insurance, a hike in fuel duty or whatever other punishing measures the Government choose, but through council tax. Because of the Government’s Corbyn-style collective bargaining for social care, councils will be required to stump up an additional £4.2 billion, or £150 per household. The path that we took in government was pro-worker and pro-business. Whereas this Government put party first and country second, we worked in partnership with businesses and workers to deliver improvements without risking investment, unemployment and businesses going bust.”
“We deserved to lose the election fair and square, but the hon. Gentleman should look at that result, because it was not a popular vote for Labour. The party’s popularity is dropping by the day, and the business confidence that we need to protect in this country is dropping by the day. The Bill is a trade union charter. By repealing the Trade Union Act 2016, it will increase the number of strikes by 53%. It is a charter that will take Britain back to the 1970s—a stated goal of the Deputy Prime Minister. The public will pay the price not just through uncollected waste, dysfunctional local government and picket lines outside hospitals, as in the 1970s; they will be forced to pay through higher taxes—a fact that the Government have now admitted in the impact assessment, despite pledging not to increase taxes on working people.”
“For small businesses particularly, it creates an existential crisis of a magnitude not seen since the pandemic. The future of hundreds of thousands of business people and millions of jobs is in the Deputy Prime Minister’s hands. I urge her to think again, withdraw this legislation and listen carefully, not just to the unions but to the voice of business, before it is too late.”
“I wish the hon. Member for Dudley (Sonia Kumar) was with me for the hour I spent with the representatives of organisations this morning. They do not feel as she does—that there is nothing to see here and nothing to worry about. They are very concerned, and we should all be worried about that. Through our approach, we doubled the minimum wage, boosted employment by 4 million, cut taxes on working people by £900, cut youth unemployment, slashed the employment rate and rolled out the biggest ever expansion of free childcare. Our approach recognised that by harming business, which is the strong horse that pulls the whole cart, we are harming workers—a fact that this Government have clearly failed to grasp. This Bill puts the cart firmly before the horse.”
“If they can name a single metric that is worse today than in 2010, I will be happy to hear it.”
“It is good to hear investors saying that now is the right time to invest in the UK. We can see why. [ Laughter. ] No, it is not necessarily because there is a Labour Government. It is because inflation is running at below 2%, whereas it was running at 11% only two years ago. In this country we have only 4% unemployment, our economy is growing as fast as any other in the G7 and our deficit stands at 4.4%. That is what we handed over to the Minister’s Government. The deficit was higher than we would have liked, but in 2010, by comparison, it stood at more than 10%. We constantly hear from Labour Members the refrain that they inherited the worst economic situation in history, but that is simply not the case. I am happy to take an intervention from the Minister, or any other Government Member, on that point.”
“We know that there is a bottleneck in our economy, particularly in planning and infrastructure, so we will welcome any changes that the Government can successfully make to accelerate the projects that have been held up by problems. We also welcome the work—for which I understand the Minister is responsible in her other role as Minister for pensions—on the Mansion House compact and the Mansion House reforms, which could liberate £75 billion of capital into our productive economy. That is much needed: only 3% or 4% is invested today in equities, compared with 50% a couple of decades ago, so it is very important that we continue the reforms started by the last Government. We were pleased to see all the positivity on Monday, despite the gloom and doom that we have heard from Government Members in recent weeks.”
“May I welcome the Minister back to this place and to her new position? I assure her that I am very happy to work with her to further the best interests of the United Kingdom. I very much welcome what happened on Monday. Having 300 investors come to this country is very welcome; this country is clearly open for business. We are keen to help the Government to succeed, because it is in everybody’s interests. I speak not only as a constituency MP, but as a former businessperson. I was also pleased to hear the Prime Minister talk about cutting red tape and regulation. We would all welcome that, although I have some questions.”
“There is no doubt that we have been through a difficult time, given the effect of covid and the cost of living crisis on a services economy, but the right hon. Gentleman will acknowledge that back in 2010 the deficit was more than 10%, whereas today it is only 4%. In real terms, adjusted for inflation, that is a difference of about £160 billion, the equivalent of the health budget. The inheritance left for the present Government is much better than the one we received in 2010.”
“The Minister is a very sensible person with experience both in the private sector and in politics, so I am surprised that she mentions that figure. Of the £22 billion, £9 billion was a result of her Government’s actions in lifting public sector pay without any commensurate productivity improvements and in scrapping the Rwanda scheme. It is fake news to say that there is a £22 billion black hole, I am afraid, and the Minister absolutely knows it. There is no doubt that there are tough spending decisions and tough choices to be made, but it is very disappointing that one of the Government’s tough choices has been to scrap the winter fuel allowance. Let us see what their other choices will be.”
“Only 20% of what was announced was not already in the pipeline before the investment summit. The reality is that much of it was already baked in. There is bound to be an overlap when a new Government come in, but let us have some transparency and honesty around the numbers.”
“That is simply not true—just read what the Bank of England said about that time. All the numbers went back to normal within a month of that fiscal event. The hon. Gentleman can choose his opinions, but he cannot choose his facts. Let us look at some facts. Of course we welcome the £63 billion that has been announced, but as the Minister and her Government stand on a platform of honesty and transparency, let us put some honesty and transparency around the numbers. The Amazon £8 billion was announced on 20 March this year. The Blackstone investment of £10 billion in a data centre was announced on 23 April this year. Of the £63 billion announced, £36 billion was announced prior to the investment summit or initiated via things like auctions by the previous Government.”
“Ernst & Young said that “60% of asset management (private equity) clients have asked them to start work on moving abroad.””
“Let me read out some of the comments about the changes that the Government are thinking of making that will damage investment. The Federation of Small Businesses said that its members are viewing the measures coming down the line with “trepidation”. Tina McKenzie described them as “clumsy, chaotic and poorly planned.” She said: “There are already 65,000 fewer payroll jobs since Labour took power, and the new Government is sending out troubling signals to businesses and investors.” Those are her words, not mine. The Institute of Directors said that confidence is fizzling out. Its index in relation to investor appetite has gone from plus 30% in June 2024 to minus 7% in October 2024. That is in just four months. The CBI said that 62% of employers say that the UK will be a less attractive place in which to invest.”
“All the uncertainty around business taxation will mean a suspension of investment and a reduction in the amount of hiring, particularly when it is seen in conjunction with the potential workplace changes that the Government are making, which we will debate in the House on Monday and about which we have great concerns. In particular, those relating to union powers could take this country back to the 1970s. I know that many Members in this place will not remember the 1970s, but I do and it was not a good place to be. In the Prime Minister’s statement, he talked about cutting red tape. If, as currently drafted, the 28 new regulations—particularly those for small and medium-sized enterprises—are added to the Employment Rights Bill, it would seriously damage growth, investment and SMEs. But the Minister does not need to take my word for that.”
“It is hugely important that the Government do continue it, because it affects some of this country’s fantastic family businesses, which generate around £200 billion of tax receipts every single year and employ nearly 14 million people. That business relief is there for a reason. It is not a tax loophole; it is an incentive for family and intergenerational businesses to pass on their assets from one generation to the next. Similarly, that happens with agricultural property relief. We are also concerned about the Government’s unwillingness to confirm that there will be no rise in national insurance for employers. Members on both sides of the House have described that as a jobs tax, and that is exactly what it is.”
“She is absolutely right to say that stability is the key. It breeds confidence in investors, which breeds investment. That is why we are particularly concerned about the changes to business taxation. Some were floated months ago and have been left hanging in the air. We know that this is now affecting investment, particularly around capital gains tax and around business relief—it used to be called business property relief—which is very close to my heart. Business relief gives private businesses and businesses listed on AIM the ability to pass on their assets to the next generation without inheritance tax. There are a number of questions around whether that relief will be continued.”
“But when I thought about it, and when I heard about the reversal of position on the DP World investment, I thought, “Well, it’s obvious why they’ve done that: they’ve asked Elton and the Transport Secretary to join in a duet of ‘Sorry Seems to Be the Hardest Word’.” Interestingly, a No.10 press release on this mentioned a rogue operator—I was not sure whether that meant the Secretary of State or the company—so I am not sure where that all landed in the end, or whether that was just a rogue comment by the Secretary of State. None the less, we welcome the investment and we will absolutely support any successes that the Government can achieve, but, as the Opposition, it is right that we challenge where challenge is due. We have many concerns about some of the things to which the Minister refers.”