On 11 January 2007, I announced the launch of a further consultation on draft regulations to increase the holiday entitlement from 20 days to 28 days (pro rata for part-time staff), implementing the Government's manifesto commitment to make paid leave for bank and public holidays additional to the existing statutory entitlement.

The Government propose to implement this change over a two-year period. Today I am publishing the Government's response to the further consultation and laying regulations for the approval of Parliament. Based on views expressed in the responses to the further consultation, we are proposing changes to the earlier draft regulations.

The Government's preferred approach in the January 2007 consultation had been to introduce half of the additional holiday entitlement from October 2007, and the remaining half from October 2008. On further consideration of the cost pressures, in particular for the health and social care sector, the Government intend to delay the second increase in the holiday entitlement from 1 October 2008 until 1 April 2009. The initial increase will come into effect on 1 October 2007, as originally proposed.

We propose to enable payment in lieu of the additional holiday entitlement to continue until 1 April 2009 in order to give those employers that use such measures to ensure staff cover, such as the residential care sector, sufficient time to recruit and train enough staff to cover for the additional holiday periods. We also propose to provide an incentive for early compliance, whereby employers that already comply with the full requirements of the regulations as at 1 October 2007 will be taken outside of the regulations, as long as they continue to meet those requirements. This approach is consistent with our policy of supporting good employers, whilst protecting vulnerable workers.

Copies of the Government response to the further consultation have been placed in the Library.