RESOLUTION. (Hansard, 18 April 1871)

§ MR. MONK
rose to call the attention of the House to the privilege of Commuting Pensions being confined exclusively to the War and Admiralty Departments, under the provisions of the "Pensions Commutation Act, 1869;" and to move, That, in the opinion of this House, it is expedient to extend the provisions of "The Pensions Commutation Act, 1869," to all the Departments of the Civil Service. The hon. Gentleman said, the subject was one which lay within a very small compass, and he hoped to be able to show that a more reasonable or moderate application had never been made than that which he was authorized to submit to the Government on behalf of the Civil servants of the Crown generally. The Act of 1869 was passed to enable the Government to purchase the half-pay of officers in the Army and Navy, and the pensions of clerks in the War and Admiralty Departments, and it passed through all its stages in both Houses without comment. So much confidence was reposed in the wisdom and kindly disposition of the Chancellor of the Exchequer and the other right hon. Gentleman (Mr. Stansfeld) who introduced it. Its object was to alleviate the hardships that might be entailed in consequence of the reductions then contemplated, and which had already taken place in those Establishments. That Act had given great satisfaction, not only to the clerks who had availed themselves of its provisions, but also to the Government and the public generally. According to 1254 the Return for which he had moved, it appeared that no fewer than 99 pensions had been commuted within the year in the Admiralty Department, amounting in the gross to £ 16,128, while 22 pensions in the War Department had been commuted for £4,653—showing that the operation of the Act had been most successful as far as it had gone. The Petitions which he had presented to the House prayed that the Act might be made to apply to the other Departments of the Civil Service, and he could not imagine what argument would be used to show that compliance with that prayer was undesirable. The Act was a great boon to those to whom it applied; but it was a boon which cost the country nothing. He would be able further to show that its extension would not only cost the country nothing, but that it would be a positive gain to the country and the Exchequer. It was well known that the Government did a considerable amount of business in selling annuities to the general public. The tables presented on the subject, sanctioned by Government authority, showed that the Government charged a much higher price for the purchase of annuities than it gave to their ex-officials when it purchased their pensions or retiring allowances. As for example, the sum offered by the Treasury for each annuity of £100, if the age of the pensioner was 25 years, was £1,485 3s. 10d; whereas the sum required by the Government for the sale of an annuity of £100 was £1,926 13s. 4d., so that by the double transaction the Government gained no less than £441 9s. 6d. It might, however, be said, that few clerks retired at so early an age, and assuming that to be true—although under the new re-organization scheme in the Customs, which came into operation on the 1st instant, many were retired who were under 25 years old—he would take the figures at the age of 35 years, when the Government offered £1,403 8s. 10d. in commutation of a pension of £ 100 per annum, but required £1,781 13s. 4d. for the purchase of an annuity of a like amount, thus making a profit of £378 4s. 6d. by the two transactions. At the age of 45 years the gain would be £296 5s., and at 55 years £205 9s. 8d. Under these circumstances, it would only seem to be necessary to ask the Chancellor of the Exchequer to extend 1255 the provisions of the Act to the Civil Service generally; but, in addition, he desired to show his right hon. Friend that the present was not an inopportune moment for bringing forward this subject. In consequence of the alteration made last year in the collection of the assessed taxes a considerable number of surveyors of taxes were compulsorily retired on pensions, and the memorials which they had addressed to the Government showed that they were anxious to be allowed to commute their pensions, in order that they might receive such a lump sum of money as would enable them either to engage in business at home or to emigrate. On the 1st of this month a large scheme of re-organization came into operation in the Customs Department, in consequence of which about 10 days ago 56 clerks were obliged to retire, and before the 1st July next the number would be swelled to 130. Those clerks were generally young men, several of them being under 22 or 23 years of age, and the pensions they would receive were so small as to be of no use to them in after life. In some cases the amount was only £16 per annum, in many cases from £20 to £30, and but few of the 56 clerks who had already retired would receive more than £40 a-year. It was a very moderate request that they made to be allowed to commute such pensions, and as the Act, so far as it applied, had met with the approval of the Civil Service generally, he asked the Chancellor of the Exchequer to enlarge its operation. When he made a similar request last Session the right hon. Gentleman (Mr. Stansfeld) said that as the Act was an experiment it was purposely restricted, and he added that the Government thought it advisable to wait and see how the Act worked in the two great Departments to which it was confined, before extending its provisions to the Civil Service generally. The Act had now been in operation since July, 1869, yet when he asked, a month ago, whether such an extension was to be effected, he was somewhat curtly answered by the Secretary to the Treasury that no such step was in contemplation. He wanted to know why? because the only difference in the cases was that the clerks in the Admiralty and War Departments were much better paid than those in the Customs. If the experiment had failed, the Chancellor of the Exchequer 1256 would, perhaps, oblige the House with a statement as to the manner in which the Act had worked, and in what respect it had failed; if not, he trusted he would extend the system to the whole Civil Service by a supplementary Act. The hon. Gentleman concluded by moving his Resolution.

§ MR. ALDERMAN LUSK
, in seconding the Motion, entreated of the Chancellor of the Exchequer to view with the most tender consideration the claims of a number of young men who had given the best years of their lives to the service of the Government with the expectation that they would be allowed to rise to the higher grades, and thus secure a competency for old age. He suggested to his right hon. Friend that it would be only fair, if reductions in one Department of the Government were considered necessary, to transfer the services of their clerks to another Department, rather than to compel them, at a comparatively early age, to retire, unless they wished to do so, upon a pension so small as to be utterly useless for any purposes of advancement, and they would then do the work of supernumeraries, as in the War Office, where a Vote of £30,000 was asked in this year's Estimates for redundant clerks. His hon. Friend, in the Motion he had made, asked for nothing unreasonable; his proposal was not opposed to economy; no fresh demand was made on the public purse. He (Mr. Alderman Lusk) thought that the Government ought to look at all the Departments under them as one, and not to make one law for the Admiralty and War Office, and another for the Civil Service of the Crown.

§ THE CHANCELLOR OF THE EXCHEQUER
said, his hon. Friend the Member for Finsbury (Mr. Alderman Lusk) would excuse him pointing out the fact that the remedy which he prescribed for the difficulties in the Civil Service would not work—namely, that of transferring the surplus clerks from one Department to another, inasmuch as they were all overmanned. That, however, was a difficulty which he apprehended would gradually disappear, because he believed 1257 it was one that had had some connection with the system of patronage, which was now done away with. Therefore, for the future he did not apprehend there would be any wish manifested to have more clerks in any Department than were really wanted. On the retirement of clerks it was frequently found that writers, who worked much more cheaply than clerks, could fill their places; it was therefore not the fault of the Government that work was not found for all the clerks at command. Since the hon. Member for Gloucester (Mr. Monk) had placed this Motion on the Paper, he (the Chancellor of the Exchequer) had carefully considered the matter involved in it; and he thought he should be able to show to him that the Government had not been far wrong in the course they had pursued. The system referred to had only been in working order about two months over the year, and it was one in which a large amount of the public money was at stake. It was originally established for the benefit of officers of the Army and Navy Departments, because they were the two Departments in which the reductions were most sweeping. The Government refused at the time to go further because they did not know how it would work, and they wished to have some experience as to its operation. Now, there were some very philanthropic persons who wished to do a great many good things at once; but the Government were often obliged to step in in order to control their beneficent desires. The salaries of the two Departments—the War Office and Admiralty—to which the Act applied, amounted to £124,000—a large sum in itself to deal with; but the salaries of the officers of the Civil Service generally would amount to double that sum. Therefore, it was a very serious question which was involved in the Motion of his hon. Friend, and the Government must be excused if they were not in a hurry to deal with it. The case, as he had before observed, had been carefully considered, and he was quite ready to meet his hon. Friend as far as he could. The House was aware that there were three ways, and only three, of obtaining pensions under the Superannuation Act by the Civil servants. One was the production of a medical certificate of continuous ill-health; the second was the fact of the 1258 claimant being upwards of 60 years of age; and the third was the abolition of the office in which the claimant was employed. Out of 350 applications for commutation, 100 of which had been granted, there were only two who applied on the ground of being upwards of 60 years of age, or under a medical certificate of ill-health. It was desirable that persons of ill-health, or in the decline of life, should not dispose of their pensions, because the original object in granting pensions was that persons who had held positions in the public service should not be reduced to poverty. He thought it would be wrong if they went too far in the first instance in restricting this privilege of commuting pensions by persons over 60 years of age, and persons retiring on medical certificates. Nine out of every ten had better not commute them, because it secured to them a certainty. The public should never forget that it was not for their interest to purchase annuities on such persons' lives. Now, what he proposed, and what he hoped would meet with the acceptance of the hon. Member for Gloucester, was that they should restrict the commutation of pensions to one class of pensioners only—namely, those who received pensions on account of the abolition of the office they held, and that they should extend that principle to the whole Civil Service. He thought, on the whole, that would be a fair and reasonable compromise. It was one that did not suggest itself to the experienced gentlemen who originally considered that subject; but it had been recommended by recent experience. He proposed to take away the privilege which had been given to the Army and Navy as far as regarded pensions on retirement after 60 years of age, and upon a medical certificate, were concerned, and to put them on the same footing as the others. No injustice, he believed, would be done by that; and they would thus get a uniform and, he hoped, a satisfactory system. It would be much better for young men, instead of lounging about here, perhaps, in idleness, on small yearly pensions, they should be able to realize a lump sum of money at once, and go and seek their fortunes elsewhere, and thus perhaps lay the nucleus of a prosperous and successful career.

§ MR. MONK
said, he thought the offer of his right hon. Friend who had just sat down was a most reasonable one; and he was most thankful, on behalf of the Civil Service generally, to accept the proposed compromise. He could only hope that the Bill promised by his right hon. Friend would be brought in and passed into law as soon as possible.