HC Deb 10 July 1946 vol 425 cc448-56

Lords Amendment: In page 35, line 9, after the second "the," insert "continuance."

Mr. Shinwell

I beg to move, "That this House doth agree with the Lords in the said Amendment."

This, and several subsequent Amendments, deal with the benefits to employees of the National Coal Board, some of whom have been taken over from the existing colliery undertakings—it may be from the ancillary undertakings—and some who may be employed for the first time. They are also designed to safeguard the rights of pensioners.

Mr. H. Macmillan

Does that include the three Amendments at the top of page 8?

Mr. Shinwell

There are four Amendments, I think—the one I have moved to agree with and the following:

In line 12, after "deeds" insert "rules."

In line 13, leave out "under which they are regulated," and insert "made for the purposes thereof."

After the words last inserted, insert: for the transfer in whole or in part or extinguishment of liabilities under any such existing schemes or arrangements.

In line 47, at the end, insert: (3) Regulations made for the purposes of this Section may be made so as to have effect from a date earlier than that on which they are made.

Mr. H. Macmillan

May we discuss the first four together, Sir, or would you wish them to be put separately? I understand that these first four Amendments are all on the same point.

Mr. Deputy-Speaker (Mr. Hubert Beaumont)

I am agreeable.

Major Roberts

I would like to offer some remarks on the fourth Amendment. We have not had a great deal of information about this. At first sight, this seems to refer to retrospective regulations. In general, retrospective regulations are bad things, which should be watched very carefully and not allowed to go through without a certain amount of scrutiny. The Clause to which the Amendments refer is that concerning rights for pensions and gratuities. We fought this matter earlier in order to get the Clause into the Bill. I do not want to say anything which will detract from the benefits of the Clause. But, as far as I can see, the result of the Amendment will be that, where a man wishes a regulation to be made about a pension or gratuity, the Coal Board can say that they need not hurry in deciding how much to give, because it can be made retrospective and the man can get the payment at a future date. I do not want to say anything which would be unjust in respect of gratuities or pensions, but I fear that if we allow this retrospective legislation to go through it will have the opposite effect

I would like a further explanation from the Minister, or the Parliamentary Secretary—who has not spoken yet—that this is not in fact going to lead to delay. We have taken great trouble in getting the Clause into the Bill. I am afraid that if we allow retrospective legislation of this kind to be made, it will have the psychological effect of delay in bringing in the beneficiaries.

Mr. Macmillan

These Amendments, as the right hon. Gentleman the Minister has said, are all designed to strengthen this Clause and to make it more effective for the protection of persons for whom it was designed. As my hon. and gallant Friend the Member for Ecclesall (Major Roberts) has observed, we welcome any strengthening of this Clause, more particularly because it was introduced in the Committee stage as a result of proposals and pressure from my hon. Friends and myself. It seems a strange thought that this great Bill to nationalise the coal industry and set up a complete monopoly, was introduced without any provision whatever, in regard to the superannuation benefit rights, of a satisfactory character. We had many discussions on this point. The Clause now occupies the whole of page 37 of the Bill and is, on the whole, the best that can be done to safeguard the interests and rights of the employees under a Measure of this kind.

I agree with my hon. and gallant Friend that retrospective legislation is generally a procedure to be deplored. It is not a very convenient procedure. On the other hand, it is for a good purpose here because it is in order to give benefits, and to support the claims of men who should be looked after, and to that extent my hon. Friends and I do not wish to disagree with it. I ask the Minister to make sure that because we can right a wrong by restrospective regulations delay will not be caused in getting on with the job. This Clause is a most vital one. It has been enormously improved in its whole character and, although we do not like the power to make retrospective regulations, we think it is good so long as it is used for the benefit of the people, and not as machinery for delay.

6.15 p.m.

Mr. Gallacher (Fife, West)

The words should not go into the Clause at all. I do not think they are necessary. I am certain that the Clause as it stands puts the Minister into a position, when dealing with the question of transfer of liabilities of this kind, to make regulations covering the period prior to the date on which he makes them. No one is going to say that paragraph (a) of the Clause ties the Minister down to making this payment to those who are to get benefit on the day when he is making the regulation; he can make it for whatever day is necessary. The Amendment proposes that the Minister may do that, but the Minister may already do that, and I am certain that the words are unnecessary. They merely add to the size of the Bill, and do not provide anything of value. The Minister, under the Clause as it stands, has the power to make regulations from a date that will be just towards those who are entitled to get benefit, and to put in the proposed words when the Minister may already do that, is loading the Bill un necessarily.

Mr. Shinwell

The hon. Member for West Fife (Mr. Gallacher) may, of course, be right, but we must remove all doubts on this score. We could not incur the risk of the right of persons who must be protected in respect of rights to gratuities being contested, and probably coming before the courts. It would be most unfair if we did not take every precaution to safeguard their interests. Therefore, we decided to insert these words.

The only remaining point is whether this will incur delay. I should not think so. For one thing, the Board must deal with the pensions schemes which are transferred from the colliery concerns to themselves. They must deal, if there is redundancy, with persons who leave their employment, or may have left their employment. There is no question of delay in that case. Persons concerned must be safeguarded, and would require some payment, some gratuity, or benefit, and they could not be left high and dry. Consequently, there would no question of delay. I understand that this is common form. It is by no means unusual, and it is intended that persons whom we all wish to safeguard should be in no doubt about their rights being preserved. I take it that that is the general intention, and, if that is so, we can accept the Amendment.

Mr. C. Williams

I am very glad that the Minister stood out against the insinuations of the Communist Party. The hon. Member for West Fife (Mr. Gallacher) suggested that the words were superfluous and so on, but this is a matter of superannuation of people engaged in this business. As a good Tory, I should strongly deprecate running any risk of not ensuring that these poeple should be compensated. I congratulate the Minister most sincerely on the courageous stand he has made in this matter. There may be amusement on the other side of the House, and sympathy with the hon. Member on his attack on the Minister. I personally sympathise with the Minister, not the hon. Gentleman. I feel sure that this is one of the occasions when an improvement is being made which is not adding to the length of the Bill. I dislike adding to the length of any Bill, but this is a matter which should be made more clear. I do not think I need add anything. I have given full warning that we now know what type of attack we may expect. We shall have to follow things very closely indeed.

Lords Amendment: In page 35, line 47, at end, insert: (4) Liabilities (whether of obligation or under customary practice) in relation to pen- sions, gratuities and other like benefits, of a kind subsisting under such existing schemes or arrangements as aforesaid in connection with the carrying on of any coal industry activities or transferred allied activities, shall be taken into account in the valuation of compensation units comprising transferred interests owned, or in things used, for such activities, and the amount referred to in subsection (4) of section thirteen of this Act which a compensation unit might have been expected to realise on the assumed sale therein referred to shall be estimated on the basis that the purchaser would be in the like position as the owner of the transferred interests comprised in the unit as respects such liabilities and as respects resort to any transferred funds held for the purposes of such existing schemes or arrangements.

The Parliamentary Secretary to the Ministry of Fuel and Power (Mr. Gaitskell)

I beg to move, "That this House doth agree with the Lords in the said Amendment."

This new Subsection makes perfectly clear the fact that the pensions liabilities of colliery businesses which will be transfered to the Board should be taken into account in the valuation of the assets for compensation purposes. I think it is quite implicit in the compensation Clauses of the Bill, because it is there laid down that the valuation shall be on the basis of market value on an assumed sale, which would clearly include the liability to pension payments on the part of the company. This Amendment makes it perfectly clear.

Colonel Lancaster

I would like to ask the Parliamentry Secretary to clarify this a little more. Do I understand that if a colliery undertaking has assumed this liability, there will be a deduction in compensation in respect of this liability? If that be the effect of this Amendment, surely it will be to the benefit of those who, for one reason or another, have not faced up to the obligation or desirability of introducing pensions schemes for their employees.

Major Roberts

I would like to take that point further. We here see a danger in the future, not necessarily to this industry, but to other industries which are threatened by nationalisation. It seems to me that colliery companies which have put into operation schemes for pensions for old age pensioners, etc., are to be penalised by this Amendment, in that they are to suffer a deduction from their compensation, whereas other, colliery companies which have not put such schemes into operation will not have a deduction from their compensation. A number of schemes have been instituted in Yorkshire in the last seven or eight years to help the old people of the collieries. They have been appreciated by everybody concerned. Is it suggested that such a scheme is to be a liability on a colliery company in the future. If that is so, if the Coal Board is not to introduce compensation schemes of a general nature, I admit that that liability is a continuing one in the future, but what does the Minister say? He says quite definitely that the Coal Board is to introduce general gratuity and pension schemes throughout. Therefore, those small schemes of these particular collieries will be merged in the greater one. The Minister said: If there are to be Regulations, as there now must be"— that is, in regard to pensions— No person should be excluded. … I think that position is comprehensive in character. There need be no fear that any person will be excluded from the provisions embodied in the Regulations when they are made."—[OFFICIAL REPORT, Standing Committee C, 2nd April. 1946; c. 701.] If that is so, all the collieries and the people in them will come under some form of comprehensive scheme. To say that because, prior to the vesting date, some particular collieries have been forward looking, have been compassionate and have introduced these schemes they are to be penalised, does not mean that they are to be penalised to the advantage of the taxpayer. This money is not coming from the taxpayers' pocket. It will come out of the global figure already paid into the industry, and what the Government are doing by this Amendment is to penalise colliery companies which have schemes for their workpeople, and to benefit the other colliery companies which have no such schemes, because those companies will get more compensation.

I would draw the attention of both sides of the House as to what effect this type of provision will have in other industries which are under the threat of nationalisation. Take steel, coke ovens, transport, etc. People might say "why do we not set up a scheme for our work-people? It would be a good thing." The answer would at once be "No, you will be penalised by the Government when they take you over; people who do not set up such a scheme will get a corresponding benefit." That is the danger I see. It is wrong that we should, from this House, encourage such a thing. It is wrong that any Government of any colour should try to stop the giving of pensions and benefits of this kind. I seriously suggest to the Parliamentary Secretary that if he can—it may be too late—he should bring in some order at a later stage which will put this matter right, and make quite clear to other industries which may be nationalised that they will not be penalised to the benefit, not of the taxpayer, but to the benefit of the more backward members of the same industry.

Mr. Gaitskell

I have a good deal of sympathy with the two previous speakers. I quite appreciate that this Subsection makes clearer the fact that a company which has had a pensions scheme will, in a sense, suffer by reason of that. But I repeat that this is really implicit already in the compensation proposals we had earlier. If the valuation is based on a willing buyer and a willing seller, and a willing buyer takes over the liabilities of the company to pay pensions, surely it is clear enough that in such a case the price would be adjusted accordingly.

Mr. H. Macmillan

Up or down?

Mr. Gaitskell

Down, of course.

Mr. Macmillan


Mr. Gaitskell

I say "of course," because it is a liability. May I put another point? It may be that the existence of the pensions scheme has led to relationships between the management and workers which have resulted in improved output and enhanced the good will of the undertaking. I think that is perfectly possible and, to that extent, it might have the effect of enhancing the value. Indeed, it is a point on the side of the Government. All we are doing is to make the position clear. It has to be taken into account. For my part, I cannot see that there is any serious criticism to be made on that point.

6.30 p.m.

Mr. Macmillan

I venture to interrupt only because I do not want it to go on record in this House that the fact of having set up the most advanced form of compensation and pension scheme; progressive management should be held necessarily to depreciate the value of the property. It might well be that the valuers would say, on the contrary, that it had been to the benefit of their undertaking as opposed to others. I thought it would be a pity if that possibility were not put upon the record. It is true that this Clause only makes clear what the lawyers tell us is implicit in the Bill as it stands. It is, alas, too late to do more than place on record the complication which is involved. In the first place, colliery companies, like all other industrial undertakings who had these pensions schemes, are now faced with the enormous problem of bringing them into line with the national pensions scheme. In the Bill, as the hon. Gentleman knows, they are given certain options. Many of these liabilities which were absolute are now only relevant in regard to the passage of the so-called Beveridge Bill. Certain rights of contracting out are given. All that will have to be taken into account because the whole structure of the National Insurance Bill impinges upon many questions in many industries.

As I understand it, there is no question of reducing the total compensation. That is fixed by the global figure. There is the rather paradoxical situation that unless it can be shown that they have increased their goodwill by virtue, those who have clone the least will gain some advantage in their slightly higher claim to compensation over those who have done the best from the social point of view That is an unfortunate thing. It is, as my hon. Friend says, doubly unfortunate. Not only is there the actual nationalisation of this industry but the threatened nationalisation of many industries in this period, and perhaps in other periods. What is the object of this legislation? Is it to prevent this during any period of the next 50 years while there may be a Socialist Party wanting to nationalise this or that industry? Is it to discourage employers from this forward movement? Is that their purpose? That would indeed be very serious. I think it would be worth while for the Government to look at this to see that we do not have this situation repeat itself because I think it is bad for the country and bad for the general progressive attitude towards modern industry.

Mr. Haworth (Liverpool, Walton)

I, too, think there is point in the criticisms which have been made and that an in- justice is being done. There is the possibility of injustice to the up-to-date employer under the system of compensation laid down in Clause 4. I would like the Parliamentary Secretary to look at the matter from another angle. Would it not be possible to insert a form of words to penalise the employer who has not instituted pensions schemes which he ought to have arranged? If we are to try to get equity as between the up-to-date employer and the one who has not done his duty to his employees, I think inquiries should be made to see whether a form of words could be devised whereby the valuers could take into account the fact that these employers have not brought the industry up to date and that they have been saving money at the expense of their workpeople. That matter should be taken into account in the valuation, and less compensation should be paid to them. That would answer the criticism and it would avoid the injustice which may be done under this Clause. Rather than saving money for the good employer it would save money at the expense of the bad employer. I hope that would meet with the commendation of hon. Members opposite.

Question put, and agreed to. [Special Entry.]