Business in mixed reaction to Tories' voluntary work proposal

David Cameron is set to divide business leaders on Friday by proposing a law that would give their staff the right to three days of paid leave to do voluntary work - a revival of his almost-forgotten "Big Society" agenda.

Previewing the Conservative manifesto, the prime minister will separately set out plans to freeze commuter rail fares in real terms until 2020, in an unfunded move that would help voters in marginal seats in the London region.

Both measures are part of an effort by Mr Cameron to give the Conservative message more popular appeal, moving beyond the party's relentless focus on the economy and negative tactics deployed against Ed Miliband.

Mr Cameron launched the Tory manifesto in 2010 with a promise to build a Big Society, and Friday's initiative on volunteering is intended to breathe life into a concept that was widely mocked at the time.

The prime minister will commit a future Tory government to giving 15m people working in companies with more than 250 staff - and everyone in the public sector - the chance to take three days' paid annual leave to volunteer.

Legislation would allow them to undertake activities such as charity work or serving as a school governor and Mr Cameron said the move would help build "a better future for our children and grandchildren".

Working-time regulations currently give full-time UK workers a statutory right to 28 days of paid leave a year, based on a five-day working week; a Tory government would change this by adding three days paid leave for volunteering.

Some companies already run volunteering and mentoring schemes, and Mr Cameron's plan was welcomed by a number of business leaders, including John Cridland, head of the CBI employers' body. "Businesses encourage their employees to volunteer in the community and should do even more to increase this," said Mr Cridland.

Sir Mike Rake, chairman of BT, said: "Corporate volunteering is a triple win - a win for the community, a win for individuals doing the volunteering and a win for the companies."

But other business leaders, speaking on the basis of anonymity, were less enthusiastic. One senior executive said the proposal was interesting in principle but thought three days was too onerous, particularly for companies with big employer bases in the retail and hospitality sectors.

"I think people will feel a bit imposed on; essentially this is a disguised tax on business," said the executive. "What they are doing is asking business to donate labour to benefit society."

Another business figure said the measure was a retrograde step from a party that had spent five years trying to reduce red tape on businesses.

"How would you define this? How do you prevent abuse?" he said. "Why are they trying to bring back unnecessary employment regulation? Wouldn't it be better to encourage employers to do this voluntarily through incentives rather than compulsion?"

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George Osborne, the chancellor, has already frozen regulated fares in line with inflation for two years. The policy cost £95m this year, but would become incrementally more costly during the course of a five-year parliament.

Conservative officials could not say how much money the taxpayer would have to give to train companies to offset lost revenue - fares had been expected to rise by 1 per cent above inflation - or where the money would come from.

"We have shown that we can afford to do this in the current parliament while sticking to our deficit-reduction plans," said one, pointing out that "efficiency savings" could help.

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