Fears raised over rights for shares plan

UK Political Editor

Tuesday 9 October 2012

GEORGE Osborne's proposed "rights for shares" scheme has been condemned by trade unions, but business leaders have welcomed the move as increasing flexibility at the workplace.

Custom byline text:

MICHAEL SETTLE UK POLITICAL EDITOR

In his keynote speech to the Conservative Party conference, the Chancellor said the Coalition was backing those who have at conference often been described as Britain's "strivers" – those who aspire to work hard and get on.

As part of this, he announced a voluntary three-way deal for a new "employee-owner" scheme. Under the scheme, firms would give workers shares of between £2000 and £50,000; they in return give up rights on unfair dismissal, redundancy, flexible working and time off for training while the UK Government foregoes Capital Gains Tax on the new shares."Get shares and become owners of the company you work for; owners, workers and the taxman all in it together," declared Mr Osborne, adding: "Workers of the world unite."His aides denied it would impact on job security and was a back-door hire and fire scheme. They predicted hundreds of thousands of people would take it up in the next few years.The Treasury expects the plan to be introduced next year and calculates the cost in lost capital gains by 2017/18 will be around £100 million.TUC general secretary Brendan Barber said: "We deplore any attack on maternity provision or protection against unfair dismissal. But these complex proposals do not look as if they will have much impact as few small businesses will want to tie themselves up in the tangle of red tape necessary to trigger these exemptions."Sarah Jackson of the Working Families' campaign group said: "Offering owner-employee contracts – where employees effectively sell their employment rights for shares – is unlikely to deliver the highly motivated, engaged workforce you need."Her advice for employees was to "think long and hard before accepting such a one-way deal".Entrepreneur Adrian Beecroft, who called for employment rights to be scaled back in a report for Prime Minister David Cameron, hailed Mr Osborne's plan as "creative and exciting", arguing it could help deliver the motivated and flexible workforce that growing businesses need.The Chancellor admitted the slump was lasting longer than expected but said British courage and creativity would prevail.While he said the rich would pay more, even though the LibDems' mansion tax was ruled out, Mr Osborne made clear the deficit would not be brought down on the wallets of the rich. This was a contrasting statement to Nick Clegg's assertion the deficit would not be brought down on the "backs of the poor".Treasury sources said details of how the rich would pay more may be revealed as early as the Chancellor's autumn statement in December. Mr Osborne defended cutting the 50p top rate of income tax, saying it raised no money and cost jobs.In response to Ed Miliband's bid last week to rebrand Labour the One Nation party, appropriating a hitherto Tory label, the Chancellor insisted it was the Conservatives who remained the true party of "one nation working together to get on".As Mr Osborne underlined the need to make an extra £10 billion in welfare cuts, he stressed how the party's belief was that it was wrong for someone to be better off on benefits than in work.Among those likely to lose out from the cuts are under-25s, who look set to be stripped of housing benefit, and unemployed parents, who could face reductions in the amounts of support they get for additional children.Last night Deputy Prime Minister Nick Clegg signalled Tory colleagues would face resistance, saying: "Nothing in detail has been agreed on cuts to welfare," adding extra contributions should start with those at the top of the income scale.

Contextual targeting label:

Local government

Commenting & Moderation

We moderate all comments on HeraldScotland on either a pre-moderated or post-moderated basis. If you're a relatively new user then your comments will be reviewed before publication and if we know you well then your comments will be subject to moderation only if other users or the moderators believe you've broken the rules, which are available here.

Moderation is undertaken full-time 9am-6pm on weekdays, and on a part-time basis outwith those hours. Please be patient if your posts are not approved instantly.

Fears raised over rights for shares plan

Commenting & Moderation

MOST READ

SPONSORED LINKS

MOST COMMENTED