Deputy Prime Minister Angela Rayner (Image: Getty)

       Angela Rayner's workers' rights overhaul could have a "negative" impact on employment, a member of the budget watchdog has said. The Office for Budget Responsibility (OBR) has said they have not yet been able to take account of the Employment Rights Bill, which has been championed by the Deputy Prime Minister, in their forecasting as there is not enough detail available on the policy.

       However in their predictions released today they say that regulations which "affect the flexibility of businesses and labour markets" are likely to have "material and probably net negative, economic impacts on employment, prices, and productivity". Professor David Miles, a member of the OBR's budget responsibility committee, said that measures which reduce an employer's flexibility could have a "negative" impact.

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       The proposed law is currently making its way through Parliament, and contains proposals such as a right to guaranteed hours and new restrictions on so-called "fire and rehire" processes.

       In their economic and fiscal outlook released on Wednesday, the OBR said: "We are yet to reflect the impact of the Government's Employment Rights Bill in the forecast," adding that there is not yet sufficient detail or clarity about policy parameters" for them to be able to make a useful assessment.

       They go on to say: "Employment regulation policies that affect the flexibility of businesses and labour markets or the quantity and quality of work will likely have material and probably net negative economic impacts on employment, prices and productivity."

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       They added that they will incorporate a "central estimate" of the policy in their next forecast, expected in the autumn.

       Professor Miles told a press briefing that it is "a bit difficult to know" where the legislation "may end up" after parliamentary procedures and amendments.

       With regards to what could happen, he told the briefing: "I think that will depend very much on what actually ends up being the law."

       He added: "Things which reduce the flexibility of employment contracts from the point of view of the employer in many cases might have a mild impact but when they do have an impact, I mean it's probably negative to some extent.

       "So altering, for example, the ability of employers to ask people to be flexible with the hours that they work .... it's hard to see that as anything other than a possibly mild negative on employment."

       He said that other measures in the Bill relating to tribunals and probationary periods could also be among those which make an impact.

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       Rachel Reeves told a press conference this afternoon that she is "confident" the Government's package to boost workers' rights will help the economy grow.

       The Chancellor said: "The OBR hasn't put anything in their forecast today about the Employment Rights Bill because it is still working its way through Parliament.

       "But we're confident that it will result in ordinary working people having more money in their pockets but also having the security to spend that money because they don't have to worry from week to week whether they'll be in work or how many hours they'll get."

       Shadow chancellor Mel Stride said the Tories wanted to see the Government "fundamentally drop a number of the measures" in the Employment Rights Bill, as it was "holding back growth".

       While the senior Conservative acknowledged the OBR had not yet reflected the impact of the Bill in its forecasts, he claimed there had been suggestions the cost of Bill could be "about ￡5 billion pounds", adding: "That's a rather large amount of money floating around."

       "What we have got to do, and what we are absolutely committed to, as a party is to recognise that businesses, small businesses, family businesses, business of all sizes, are absolutely fundamental to the future of this country.

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       "Unless we can get growth going, and productivity improved, and businesses thriving, then that makes the whole world that much more difficult.

       "So we are absolutely committed to having a flexible labour market. We think there are a number of things in that employment legislation that are going to hold businesses back in a way that is going to be not good for all of us."

       Mr Stride was, however, realistic about the Conservatives' inability to block the Bill, because of Labour's "huge majority" in the Commons.