Next week’s Budget must avoid imposing fresh costs on business in the wake of the Employment Rights Bill, the Recruitment and Employment Confederation has warned.
The REC’s chief executive Neil Carberry said: “In light of the impact assessment of the Employment Rights Bill forecasting billions of pounds of additional costs to business, the last thing firms want to hear in the Budget is news of even more costs, or more complexity for how they run their businesses.”
Carberry focused on NHS staffing as an example of short-term fixes being allowed to override the pressing need for holistic reform. He said: “The NHS staffing model is in dire need of an overhaul; it is failing to deliver value for money. Huge investments go into the training of medical and clinical staff in the NHS who end up overworked and undervalued – and then leave the service unless they take a temp job where they can better manage their working lives.”
Employment Rights Bill
Impact of Employment Rights Bill published as consultations launched
Employment Rights Bill: 12 key takeaways
Employment Rights Bill: government outlines next steps for future reforms
Non-permanent NHS staff had been treated “abysmally”, Carberry said, in the sense that for many years they have been excluded from pay rises. This has led to a situation in which NHS internal banks were often more expensive than agency staffing models.
Calling for a “fundamental change to how the past government approached workforce issues”, Carberry said business and public investment underpinned growth, so boosting these needed to be a priority over short-term issues.
He warned: “Savings today to spend more in three or four years is not the way to underpin public services or bring the tax burden down.”
The REC said it understood there were some difficult choices to make in the Budget – but businesses needed measures that help them to unlock investment. It said: “An additional pound spent on rising government charges, tax or complying with badly designed regulation is a pound that can’t be spent on investing in the future.”
It agreed with ministers that a more effective NHS would be critical to reducing economic inactivity, improving lives, and saving money over the long-term.
Ministers needed to put a UK workforce plan at the heart of industrial strategy, which would give the government and business a clearer understanding of the modern labour market. An important first step to this plan was to conduct the first Workplace Employment Relations Study for a decade to inform policy based on an accurate view of the current jobs market, said Carberry.
Rachel Reeves, the chancellor, must also incentivise investment in skills needed to build a UK workforce aligned to the jobs of the future, he said. This includes ensuring the long-overdue reforms to the apprenticeship levy to allow recruiters to better utilise the millions of pounds they pay into the levy pot which go to waste every year.
Carberry argued that more investments should be made in transport links: investments in the Elizabeth Line and the Borders Railway repeatedly outperformed Treasury growth expectations and had a significant labour market activation effect.
He added: “By addressing skills and labour shortages, reducing economic inactivity and boosting productivity, we can ensure our prosperity and lower the tax burden. Improving access to quality jobs, especially flexible, temporary roles, and equipping people with the necessary skills will enhance their well-being and drive productivity.”
Sign up to our weekly round-up of HR news and guidance
Receive the Personnel Today Direct e-newsletter every Wednesday
Latest HR job opportunities on Personnel Today
Browse more human resources jobs
