The Earl of Minto (Con)

My Lords, I shall also speak to Amendments 40, 41 and 45, tabled in the name of my noble friends Lord Harlech, Lord De Mauley and Lady Penn. My noble friend Lord Harlech has long been a doughty and most effective champion of our Reserve Forces. These Benches share his conviction that the reserves are indispensable to our national defence and deserve every reasonable support we can muster. However, I am afraid that I must express some reservations about the amendments in this group and in the next. This is a genuine and very difficult balancing act. On the one side sits our duty to reservists and to employers, who already, at times, go beyond the call in supporting them. On the other sits our duty to the small and medium-sized businesses that make up the overwhelming majority of Britain’s employers and that are, right now, facing a cumulative weight of obligation that these amendments risk compounding rather than ameliorating. Some 5.5 million businesses operate in this country, over 99% of which are small or medium-sized enterprises. Firms of the kind caught by the 50-employee threshold —or the 10-employee threshold in Amendment 41—are frequently the very smallest operations; they might be a family firm, a local manufacturer or a handful of tradesmen incorporated together. For a business of 10 employees, losing one member of staff for 10 working days a year for training could produce real strain on its workforce, potentially pushing back deadlines and damaging its ability to compete for contracts against larger rivals that can afford such absences more easily. It could also—this is quite dangerous—influence the willingness of employees and fellow workers to be generous with their attitude towards service. That is very important. This cannot be considered in isolation from the wider climate in which small businesses currently operate. Businesses have had to suffer two years of this Government that have made their lives considerably harder, with the increases in employer national insurance contributions and the national living wage under the Employment Rights Act. That is the context in which we judge these amendments. We are not saying that reservists do not deserve support—indeed, quite the opposite—but we believe that the existing defence employer recognition scheme, built on voluntary best practice among gold and silver employers, achieves much of what these clauses seek without imposing statutory duties that might deter smaller firms from hiring reservists at all, the very outcome we all wish to avoid. I hope my noble friend will reflect on these concerns in the spirit in which they are offered, and I look forward to continuing this conversation as the Bill progresses.