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Unemployment

Thank you, Mr. Deputy Speaker, but I understand why my hon. Friend wanted to make that intervention, because what he told us is significant and tragic news for his constituents. I wish all those who have lost their jobs well. This reminds me of some of the problems I faced when I was in business. Leaders of a company—the chairman of the board or the managing director—sometimes have to fight desperately to keep it going, trying to find solutions by offering shares, for example, only for the bank to do the absolute opposite of what it should. It makes life more difficult and, in the case mentioned my hon. Friend the Member for Ludlow (Mr. Dunne), the bank has forced the company into liquidation or administration. I remember my business receiving a £500,000 cheque from another company for some advance work, and the bank involved happened to be one of the now nationalised ones. It happily entertained me and took me to the very best cricket matches, irrespective of whether the company was doing well, yet just when we needed the money, the bank was not there. It did the opposite of what it should have done, demanding more fees and more interest. I am afraid that, as of yesterday, that is now the position of the company in my constituency. I do not want it to finish up in the same circumstances as my hon. Friend the Member for Ludlow described. I repeat that it is one of the nationalised banks that is taking this action. I know that Ministers are also concerned and I also know that there is no magic wand, but I am highlighting a real problem in my own constituency. If we could get such problems sorted out, the potential to save jobs would be enormous. My second point deals with the other end of the scale, when people have lost their jobs. I had an Adjournment debate on the subject recently, but the point is worth making again. Forty people lost their jobs last December in a well respected company in my constituency, which had been in business for more than 100 years. The only way it could survive in business—by saving £600,000 a year in salaries—was by making those people redundant. Some of those employees had worked many years for the company—more than 30 years in some cases—so there was a £250,000 redundancy bill to pay. If it attempted to pay the redundancy money, the whole company would have gone under, with the remaining 80 people losing their jobs, too. The company therefore failed to pay the redundancy money, but the 40 people, who have been most restrained, have still not received their redundancy money. I do not blame the company for not paying it—if it had, the whole company would have gone under—and I do not blame the Government, but I think that there is a loophole in the law. The most obvious solution would have been for the redundancy payments office to step in and pay the redundancy money, subsequently claiming it back from the company over a number of years. In fact, there is a Government scheme that would have allowed that, but the problem is that the company has to approach the redundancy payments office first and negotiate with it; if the RPO is satisfied that the company is in financial need, it should pay the money. In reality, however, when people are fighting to save their family businesses and face circumstances that they have never faced before—when they are trying to deal with banks to get extended credit and to keep the company going while having the horrible job of telling people that they have lost their jobs—they are not going to go to the redundancy payments office to negotiate a settlement. My suggestion is to make a simple change in the law so that the RPO can be proactive and say to a company, "You've got a problem here; we'll pay the money and we'll try to get it back from you over a number of years if you trade out of the problem". That is not going to cost the Government any more money, because if the company fell the Government would have to pay the redundancy money. In this case, the company went into administration and the RPO will pay the workers in due course. In my view, however, the workers should have been paid in December because the company would have had more chance to trade out of its difficulties. Such a change in the law or change in attitude would not cost the Government anything, and would benefit many people. My final point is not at all party political. My constituency has had unemployment over a longer period and has seen immigration from central Europe. The problem is that some unemployed constituents blame the fact that they do not have a job on immigrants. This multi-ethnic area, which has had wonderful community relations in the past, now faces the problem of the British National party, which we never had before. We have to start talking about the issues and explaining what we are trying to do to solve the problem, but we cannot ignore it. We cannot say that there is not a problem and that people are not linking immigration with the fact that they do not have a job.