PARLIAMENTARY DEBATE
Employment Costs - 30 January 2025 (Commons/Commons Chamber)

The Government are pursuing the reforms needed to deliver sustained long-term growth. Developed and delivered in partnership with business, we have taken significant steps, including launching a consultation on the modern industrial strategy, establishing the national wealth fund, transforming our planning rules, committing to a 10-year infrastructure strategy and introducing the Employment Rights Bill to boost productivity. We have also added extra protections for small businesses by increasing the employment allowance and freezing the small business rate multiplier.

I think the Minister may have misunderstood my question; I asked how he would reduce employment costs. The president of the Confederation of British Industry recently said that, because of things like the Employment Rights Bill, employers will be laying people off and will be less likely to employ, and that is before the national insurance tax on employment imposed by this Government. Does the Minister accept responsibility for the increase in unemployment that we are already seeing?

I think it is something of a stretch to say that a Bill that is not even law yet, most of the provisions of which will not come into force until next year, is driving unemployment already. I quote back to him what the head of the CBI said yesterday about our growth plan. He said:

“This positive leadership and a…vision to kickstart the economy and boost productivity is welcome.”

I call the shadow Secretary of State.

I thank the shadow Secretary of State for his question. We believe that a 0.4% increase in the overall pay bill, which is what we have estimated the Employment Rights Bill will mean for businesses, is actually a fantastic return for greater security at work, greater pay, better staff retention, increased productivity, making jobs more secure and family friendly, banning exploitative zero-hour contracts, supporting women in work in every stage of life, providing a genuine living wage, turning the page on industrial relations, and bringing an end to fire and rehire. This is a pro-business, pro-growth, pro-worker agenda from the Government, and we are determined to deliver it.