In evidence to the Committee, the FSB said it would survey its members again anyway. The Government could look at that survey and work with the FSB to see how it surveys its members. They might want to take a representative cohort of people who have taken up the employment allowance; discuss with them its impact on their businesses; and then extrapolate lessons for national take-up. I do not seek to prescribe exactly how they should carry out the review—I am sure there are clever bods in the Treasury whose job it is to think of these things—but given what has happened already in this Parliament on national insurance, it is important that we concentrate the mind of the Government. The House expects and wants this policy to succeed and not to suffer the problems of the previous policy. It also wishes to continue pressing the Government on this point.
The last element of new clause 1 concerns the effective promotion of the employment allowance to all who are eligible. In particular, I have in mind the FSB’s evidence to the Committee about the effectiveness of that communication. It is worth considering that in a review, particularly if there is a problem, such as a geographical inequality, with overall levels of take-up. How the allowance is promoted will clearly have an effect. Charities and sports clubs are rightly eligible for this £2,000 reduction in their national insurance bill, but there is a risk that they might miss out and that we promote the allowance to businesses more effectively just because they have more stakeholders and larger bodies getting the message out. The new clause seeks to ensure that we keep across that concern and that not only eligible businesses but other groups that rightly fall within its scope take up the employment allowance.
New clause 2 seeks a short administrative and compliance costs review six months after the Bill comes into force. It is motivated by two things in particular. First, as I mentioned earlier, the Government expect 90% of those
eligible to claim the employment allowance. The Institute for Fiscal Studies and others—we heard this in the Committee evidence session—have asked about the other 10%. The system for claiming the employment allowance is straightforward and everybody expects the running of it to be smooth. However, one wonders why 10 per cent. are always assumed to miss out.
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The other driver behind the new clause was the evidence from Mr Holloway, which was received after the Committee concluded its deliberations. I thought it illuminating nonetheless, partly because it gave me an opportunity to get to grips with the details of payroll software; an expertise that I have not previously had the pleasure of enjoying in this House. Mr Holloway’s evidence, which was made available to the Committee and to the Minister, suggested that there were problems about the guidance not being available in sufficient time for developers to get their software ready. He indicated that, normally, three to six months is required for systems to be developed, including time for specification and documentation of the changes, development, testing and release to clients.
On new clause 3, the Minister said that the guidance was going to be available in January, which seems to put at risk the availability of the software being ready or, at least, software developers will be up against it in getting everything tested and working on time before the employment allowance comes into force. The purpose of the new clause is that, six months in, we will have an opportunity to make sure that software-type issues have been ironed out and that businesses are not reporting compliance or other administrative costs that we will not know about until it is rolled out. If they are, that gives an opportunity for MPs and the Government very early in the life of the allowance to consider what changes might be made to remove those issues.
Both clauses are designed to assist the Government from a perspective of support for the employment allowance, a desire to see it work effectively, a desire to make sure that every business that is eligible for it is able to take it up, and a desire to see that it has a positive impact on job levels and wage rates.