CBI chair condemns ‘incoherence’ of Labour’s Employment Rights Bill
Rupert Soames, the outgoing chair of the Confederation of British Industry, has lambasted the Labour government for promising to cut regulatory burdens while pushing ahead with its Employment Rights Bill and adding to the cost of hiring.
In a closing speech at the CBI’s annual conference on Monday, Soames questioned the government’s performance and “flakey majority” after its first year in office, taking aim at policies that raise costs for businesses.
He said Labour’s “actions do not match the intentions or the words” amid government pledges to cut the regulatory burden by 25 per cent over the next five years to support businesses with driving growth.
“At its heart, there is an incoherence in government strategy,” he told business leaders on Monday.
“They want, rightly, to get people, particularly young people, into work. They point out, rightly, that one million young people between the ages of 16 and 24, who are not in employment, education or training.
“There is no better way of improving the state of the nation’s finances, or the health and welfare of millions of people, than from getting them to move from being benefits claimants to being taxpayers through employment.
“The government says they recognise the drag from burdensome regulation on business, and say they are committed to reducing it.
“In the face of these two objectives, they have significantly increased the cost of employing people, particularly the young, and they are in the process of passing the Employment Rights Bill, which will massively increase the regulatory burden and the risk of employment, and yes, introducing a whole new regulator.”
Earlier in the day, Soames also described the bill as “one of the most damaging pieces of legislation” he had seen in his working life.
Peter Kyle defends Employment Rights Bill
Soames’ comments came after business secretary Peter Kyle urged bosses attending the CBI conference to contribute to 26 consultations to be opened in response to the bill.
He told them their worries would be considered in negotiations though he defended the bill’s procedure through parliament despite a ping-pong of amendments between the House of Lords and House of Commons.
Kyle said the government was committed to working with businesses to ensuring the bill improved productivity levels in the workplace despite research suggesting that hiring would slow down and business costs could rise by as much as £5bn.
“The manifesto committed me as secretary of state to this government to listen to both sides and all sides in this, and to make sure it is not zero sum,” Kyle told City PM.
“I will not pit employer against employee or employee against employer.
“Regulation has to keep up, and the ability of the government to inspire and provide the foundations for growth within individual businesses and higher productivity is what we are set upon.”
“All of the conjecture that you’ve heard about what the bill will and won’t deliver is based in areas for which the consultation and implementation has not even started.”
Speaking shortly after Kyle, Tory leader Kemi Badenoch joined CBI bosses in criticising the bill as called workers’ rights reforms “anti-business” and “anti-growth”.
“It does not add a single unit of productivity,” Badenoch said.
“If the Chancellor had any sense, and any regard for business, she would use the Budget to say, ‘we got this one wrong’ and drop it. It would be the cheapest pro-growth measure in the Red Book.”