HC Deb 20 November 1950 vol 481 cc98-110

6.41 p.m.

Mr. I. J. Pitman (Bath)

I beg to move, in page 1, line 6, to leave out "four thousand five hundred" and to insert "five thousand."

This Amendment, and the one which accompanies it, in page 1, line 7, at the end, to insert: Provided that in no case shall such salary be less than that of a Permanent Secretary to a Government Department other than the Treasury, may, I hope, by agreement be discussed together. At least, I think that is the wish of the Financial Secretary. The Amendments are not, I regret to say, upon the Order Paper, owing to an omission, but are on a separate paper.

The Chairman

Both Amendments are, in fact, on the Order Paper, and I am agreeable to their being discussed together.

Mr. Pitman

I must explain to the Financial Secretary that, whereas I gave him notice that I would move an Amendment to the Bill to make the Comptroller and Auditor-General have the same sum of money to take home each week as he had in 1910, allowing, first, for the difference in taxation, and, secondly, for the very great difference in the purchasing power of the pound, I assure him that, on my calculation that 8s. 6d. now represents what 20s. was worth in those days, I worked it out and found that I should have had to put down an Amendment for £25,000 per annum for the Comptroller and Auditor-General. But it struck me that, whereas that might draw attention to the deplorable way in which the value of money has altered since 1910, and the astonishing way in which taxation has risen to such a high level, it was not a very practical and constructive Amendment to put down. So I put down this Amendment that we should pay him £5,000 a year, instead of the £4,500 which is in the Bill.

Why have I chosen the figure of £5,000? I would like to refer the Financial Secretary and the Committee to paragraph 26 of the Chorley Committee's Report. There, under the heading of "Administrative," it is stated: We recommend a salary of £4,500 for Permanent Secretaries. By comparison with the rates referred to in paragraph 23, with full allowance for differences in personal responsibility and in security of tenure, we should have wished to recommend £5,000 for the Permanent Heads of several Departments where we think the burden of responsibility is particularly heavy. We were however impressed by a weight of evidence which showed that an exceptional salary position would not have been welcomed by the officers in question, who place great value upon the sense of equality and the good understanding which now exist. 6.45 p.m.

I think I am right in saying that the Chorley Committee has really recommended £5,000 a year as the appropriate salary for the head of an important department, and the Financial Secretary has already said that he had chosen the figure of £4,500 because there was an understanding that the Comptroller and Auditor-General should be paid on the same level as a Permanent Secretary of one of the important Departments. If I have got him wrong in that respect I hope he will correct me, because it is even more important that we should have a clear idea whether he is to follow the recommendations of the Chorley Committee as regards the Comptroller and Auditor-General being included, as he said, on the same level as the Permanent Secretary of an important Department, or whether he equates him with the Permanent Secretary of a minor Department.

It seems to me that the issue of team work does not here arise. It is highly creditable for the Permanent Secretaries to say that, in the interests of team work, it was invidious to pay them differential salaries and that they were insistent on being paid the lower figure. But that argument clearly does not apply in the slightest to the Comptroller and Auditor-General, who could and should be paid on the merits of his case. If he is to be within the same figure as a Permanent Secretary of a major Department, then, clearly, the whole Committee would admit that he should receive £5,000, as suggested in the Amendment, and not £4,500.

The next point I would make in favour of £5,000 is that the Chorley Committee is already two years out of date. Its Report gives an impressive list of people being paid £8,500 a year and very liberal expenses, which are shown in the Appendix on the back page. There have been a number of very high salaries added to that list, and inflationary pressure has increased during that time. I think it would not be at all out of place to argue. first, that even if we pay them on the plane of a minor Department the whole scale should, in these two years, have gone up, and that, even at £5,000 for the Comptroller and Auditor-General he is not, in any way, overpaid.

Further, the whole climate of public opinion in regard to the payment of Permanent Secretaries and important executives has altered enormously in the intervening years since the Chorley Committee reported. I think it is now felt that it is far better to pay these people a high salary such as they deserve and to cut out all the trouble of giving them free cars and having arguments about whether a wife should be permitted to go for a free ride in a Government car. We ought, on the other hand, to pay our people so that they can afford cars of their own if they want them, so that they will be able to take their wives out without asking or arguing with anybody about it.

I think there is one further extremely important and potent argument in this connection, and that is that the way in which Secretaries are paid in the Civil Service has stopped recruitment to the administrative class. Over the last four or five years, I think there have not been enough people for the posts offered, and, for the first time this year, the number of people who passed the examinations is, I am told, up to the number of posts offered. Does the hon. Gentleman realise that 25 per cent. of those people who passed the examination and who were then offered the posts declined to accept them? It is a most important and sig- nificant fact, and one which we ought to take very seriously into account, that the rates of remuneration paid to our civil servants are such that they do not attract sufficient entries for the examination nor induce the successful candidates to accept the posts offered.

I may say that most of those who would be suitable for the posts have gone into some tax free educational service or into business and have been lost to the British Civil Service, which I would say—

The Chairman

The hon. Member appears to be dealing with the general question of the recruitment to and salaries of the Civil Service. He must restrict his remarks in that connection to the Comptroller and Auditor-General, who is the subject of the Amendment.

Mr. Pitman

On Second Reading, I put forward the argument that we recruited our Comptroller and Auditor-General as a gamekeeper from the poachers who are the spenders of the taxpayers' money in the Departments and that the Comptroller and Auditor-General's post is one of the plums to which people in the Civil Service look forward as the result of a successful career in what is a very glorious and famous Service.

I will not, however, elaborate the point because I think it is perfectly clear to the Committee as a whole that whether it is the Comptroller and Auditor-General or a Permanent Secretary with whom he is equated we have got the best civil servants in the world and are probably unique in giving them the worst pay. Therefore, I particularly recommend this Amendment to the Committee as putting right, at any rate in so far as one civil servant is concerned, a rate of remuneration which is an improvement on the rate put forward in the Bill.

I now come to the constitutional issue, which is that the House has always been very jealous that the Comptroller and Auditor-General should be paid by the House and not by the Government. In fact, I think that is the only reason why I am allowed to move an Amendment to increase a payment out of the funds of His Majesty as, otherwise, it would be a Government expenditure and I should not be in order in moving such a charge on the funds. I am allowed to do it in this case because it is specifically a constitu- tional point and one of which we are very jealous that the Comptroller and Auditor-General is the servant of the House.

Is it right that the Government, rather than the House, should determine the salary in this particular case? I think it is wrong in principle that it should be the hand of the Government that feeds the dog. The dog always looks to the hand that feeds him. Throughout the ages, in so far as offices of profit under the Crown or any of those other matters are concerned, we have always been extremely anxious that any payment to a person who is to watch the Executive shall be a payment made by the House in its capacity as a whole.

The Chairman

I think there must be some misunderstanding. The salary of the Comptroller and Auditor-General is based on the Consolidated Fund and not on the House of Commons' Vote and the matter is definitely one to be decided by the House. Therefore, I am not clear to what the hon. Gentleman's remarks are directed.

Mr. Pitman

I think I made it quite clear that I accepted the fact that it was based on the Consolidated Fund, but in the case of the Comptroller and Auditor-General there is something completely different from the payment made to anybody else in the Civil Service, in the military service or in any of the other Services which comes out of Governmental money. This is money which is voted by the House to its own servant. The Comptroller and Auditor-General, as I said just now, is the gamekeeper who is watching the poachers who are spending money on behalf of the House, and it is only right that his salary should be determined by the House and not by the Government.

I am really asking the Government whether they intend to put their Whips on for this Amendment, and I would like a clear answer from the Financial Secretary as to whether or not he is going to leave it to a free vote so that the Committee may decide what it will pay its own servant. If the Committee agrees, as I hope it will, that the salary should be paid, at any rate, in accordance with the recommendations of the Chorley Committee, then I trust it will support my Amendment.

Mr. Pickthorn (Carlton)

I want a minute in which, if I may, not so much reinforce as emphasise the plea for maintaining, and, if possible, of enhancing at least the independence and dignity of the Comptroller and Auditor-General. I do not know whether, in connection with the argument that it should rather be for the House than for the Treasury Bench to fix this salary, you, Major Milner, would allow me half a minute, perhaps on the very fringes of order, to question—that is, if the Financial Secretary does not mind; it is rather a technical point—whether the word "may" is appropriate here.

I know it is not strictly in order on this Amendment, but it is part of the same argument that the payment ought to be, and ought to be plainly seen to be, coming from the decision of the House and not from the decision of the Government. Of course, it would obviously be grossly indecent to put in a Bill that His Majesty "must" do this or that.

Whether this is one of the cases where "may"—the lawyers tell us that "may" has a compulsory effect—should be used, or whether, if not, we should consider, on the Report stage, some other form of words rather than this, which appears to leave it permissive to the Executive to pay the entire salary, seems to me to be a question which ought to be raised, although I apologise for raising it now when I am aware, that it is not strictly in order.

The Financial Secretary to the Treasury (Mr. Douglas Jay)

In reply to the hon. Member for Carlton (Mr. Pick-thorn), so far as I know, the word "may" is the customary and appropriate word to use in these cases, but I will certainly examine the point before the Report stage to see if there is any doubt whatever about it.

In reply to the hon. Member for Bath (Mr. Pitman), I wish to say, first of all, that I think there is no dispute between us about whether the salary of the Comptroller and Auditor-General should be decided by this House and charged on the Consolidated Fund. That is certainly the case—for good constitutional reasons. The hon. Member will recall that I said so myself in the Debate on Second Reading. Nevertheless, I think that the Government are perfectly entitled—and, indeed, it is their duty—to propose to the House what they think the salary should be, and to ask the House to reach its decision accordingly.

The hon. Member for Bath is proposing that this salary should be raised from £4,500 to £5,000 a year. I rather thought, judging by his speech on Second Reading, that he was going to base that argument on his calculation of what we should have to pay in order that the Comptroller and Auditor-General should get the same income in real terms after taxation as he got in 1910. Had he argued that, I should have been compelled to point out, first, that there has been a certain redistribution of incomes in this country by taxation since 1910 which has affected all of us and not merely the Comptroller and Auditor-General or, indeed, senior civil servants, and, secondly, that the argument that we have got to increase any money income, however large, because there have been changes in the cost of living is, of course, the classic argument which leads to inflation. Therefore I should not have been very much impressed by those two arguments.

7.0 p.m.

I think the hon. Gentleman realised the weakness of both arguments when he calculated that a salary not of £5,000 but of something like £25,000 would have to be paid in order to reach that result. Therefore, as I understood him, the hon. Gentleman changed his ground and rested his case on paragraph 26 of the Chorley Report. He quoted one or two sentences from the earlier part of that paragraph which rather suggested that the Chorley Committee would have liked, on certain arguments, to have suggested a salary of £5,000 for a Permanent Secretary.

Mr. Pitman

Of a major department.

Mr. Jay

The hon. Gentleman, however, did not quote the sentence in which the Chorley Committee summed up their conclusions on this point, and which reads: In the circumstances we think it better to recommend £4,500 for the whole range of posts now paid at £3,500. That was the conclusion of the Committee, and that is, in effect, a proposal that the Comptroller and Auditor General's salary, like that of other Secretaries, should be raised to £4,500.

Mr. Pitman

It is quite clear in the early part of this paragraph that it was only in the interest of team work as between heads of Departments that this equality arose at all. Their clear cut recommendation is that what they would have liked to have done was to pay £5,000 to some and £4,500 to the others.

Mr. Jay

Nevertheless, taking into account the fact that, ever since 1866, the salary of the Comptroller and Auditor General has been the same as that of the majority of Permanent Secretaries, it is perfectly fair to argue, in view of the sentence I have quoted, that, if we follow the general conclusions of the Chorley Committee, we are bound to propose a salary of £4,500.

I thought the hon. Gentleman's other argument was to the effect that the Chorley Committee's proposals altogether were out of date and, therefore, could not be quoted as authority for the proposal we are making. If I followed that argument far, I should also get out of order, because I should be led into a discussion of the salaries of civil servants generally and not simply that of the Comptroller. Therefore, I would only say again, that arguments based on changes in the cost of living over a very short period are very unsafe grounds for proposing immediate changes in salaries of this kind. It is, of course, precisely the argument that every money income must follow movements in prices which leads us to inflation.

Finally, with all due respect to the hon. Gentleman, I am bound to point out that his proposals are one further example of the Opposition although always enjoining economy on us, in practice proposing additional expenditure. I regret that I cannot accept the Amendment.

Sir Herbert Williams (Croydon, East)

I think the Financial Secretary slipped up in his reply to my hon. Friend the Member for Carlton (Mr. Pickthorn). He said he would look into the question whether "may" means "may" or "shall" with a view to putting it right on the Report stage, if he finds that is necessary. If, as it is probable, this Bill goes through without Amendment, there will be no Report stage—

Mr. Pickthorn

I assumed that the Financial Secretary was going to accept the Amendment.

Sir H. Williams

—and, therefore, it might be necessary to do it in another place. It would be said in another place that it is a matter of privilege, because to instruct His Majesty to make a payment is outside their purview. In view of that, the Financial Secretary had better think again, and think now.

The Chairman

I think the matter arose because, possibly, I was at fault. I should not have permitted the hon. Member for Carlton (Mr. Pickthorn) to raise a point on which he had not put down an Amendment, and which, to be raised at all, could only now be properly raised on the Motion "That the Clause stand part of the Bill." I hope the matter will not be taken further.

Mr. Pickthorn

I am afraid, Mr. Chairman, that that will almost compel me to ask you to permit it to be raised on the Motion "That the Clause stand part of the Bill." I thought I had made it clear at the time that I was not going to do that.

The Chairman

That might not be necessary.

Mr. Assheton (Blackburn, West)

I think I am right in saying, Mr. Chairman, that you told the Committee that we were discussing two Amendments in the name of my hon. Friend the Member for Bath (Mr. Pitman). So far, we have only had an answer from the Financial Secretary to the Treasury with respect to the first Amendment. As I hope that he may agree to the Amendment we have not yet discussed, it may be that there will still be a Report stage of this Bill. Therefore, I will not enter into the argument that my hon. Friend the Member for Carlton (Mr. Pickthorn) has raised.

On the first Amendment, I gathered from what the Financial Secretary has said that the Government are not prepared to accept it. In other words, they are not prepared to raise the salary of the Comptroller and Auditor General to £5,000, instead of £4,500 as proposed in this Bill. The Financial Secretary commented that hon. Members on this side of the House were inclined to suggest increasing expenditure, whereas on other occasions they called for economy. The position we have always tried to make clear on the matter of payment to civil servants—and I am not proposing to get out of order by discussing that at any length—is that there are far too many civil servants, that the Government engage in far too many activities, but that we should like to pay those we have very well indeed. I am quite certain that no one in this House would deny that the Comptroller and Auditor-General deserves a good salary and should get one, and I am sorry the Government have not seen fit to accept this first Amendment.

As to the second Amendment, which I hope the Financial Secretary and others in the House will think is a very sensible one, on this occasion we have to have a Bill specially to raise the salary of one individual man. That is not altogether a convenient method because, from time to time, the House is very busy, and it is not always easy to find time to fit in a Bill. I should have thought that there was something to be said for the Amendment which my hon. Friend the Member for Bath has put down, and which is to enable the salary of the Comptroller and Auditor-General to be raised when the salaries of civil servants of similar rank are raised generally.

That would avoid the necessity, on a future occasion, of having a special Bill introduced in this House and, at the same time, there is something to be said for that course as being convenient. I should be obliged if the Financial Secretary would be good enough to tall the Committee whether he is able to accept the second Amendment.

Mr. Jay

I think the suggestion of the hon. Member for Bath (Mr. Pitman), although not entirely carried out by this Amendment, is, in effect, that we should lay down in this Bill not that the salary of the Comptroller and Auditor-General should be any particular figure but that it should move with the salaries of Permanent Secretaries. If that were desired, the Amendment would have to be slightly different from what it is.

Mr. Pitman

My suggestion was not that it should move, and possibly go down, but that it should go up.

Mr. Jay

I think that makes the suggestion even less attractive. Nevertheless, the real objection which we see to the proposal implied in this Amendment—which has the effect that the Comptroller's salary should be decided, not by a Bill passed by this House, but by decisions taken from time to time by the Executive—is precisely the point which the hon. Member for Bath made earlier. If we were to do that, then to some extent the Comptroller's salary at any given time would be decided by the Government without reference to this House, in so far as they decided to raise the salaries of higher civil servants—and I agree that it is not the case if the salaries were lowered, which is perhaps not quite so probable. Therefore, although I think it is an arguable proposition and some grounds can be advanced for doing it in the other way, on the whole we prefer to make not the slightest infringement of the constitutional principle that the Comptroller's salary should be decided by the House and not in any way by the Executive, the Government.

Mr. Assheton

If the Financial Secretary thinks that the constitutional position of the House would be infringed in the slightest way, then I should not ask him, to accept this Amendment. I had hoped that the ingenious Parliamentary counsels which are at his disposal would have been able to find some way of achieving the object of the Amendment without in any way infringing the constitutional position of the House. If that cannot be done I, for one, should be bound to agree with him.

Mr. Pickthorn

I am not sure whether I shall be out of order to raise the question again, but I should like to put this point quite distinctly. Perhaps I may raise it on the Question that the Clause stand part.

Amendment negatived.

Amendment proposed, in page 1, line 7, at the end to insert: Provided that in no case shall such salary he less than that of a Permanent Secretary to a Government Department other than the Treasury.

Amendment negatived.

Motion made, and Question proposed, "That the Clause stand part of the Bill."

Mr. Pickthorn

I am sorry to raise the point again and I shall be extremely quick. The Financial Secretary said just now that he was very anxious to preserve the constitutional principle that the salary is fixed by the House and nothing but the House. Upon that principle, the question I shall put to him is this. Is he quite certain that the words "His Majesty may" in this Clause and, again, I think in Clause 2, do not in fact give some chance of the decision being taken other than by this House?

To put it in another way, can we be assured that His Majesty's Ministers cannot conceive of His Majesty's advisers, whether themselves or others, advising against the payment of the salary as indicated in this Bill, because unless they can answer that question quite categorically they are doing what the Financial Secretary has said he is particularly anxious not to do—that is, whittling down the constitutional principle that the payment should depend entirely upon this House and nothing but this House and should not depend upon His Majesty's advisers.

I hope I have put the question plainly. I apologise, for it may well be that there are technical reasons why the answer to it is quite obvious. The answer is not plain to me. I hope I have put the question plainly and that the Financial Secretary will answer it plainly.

7.15 p.m.

Mr. David Renton (Huntingdon)

I should like to add to what was said by my hon. Friend the Member for Carlton (Mr. Pickthorn), because so often in these days we find we are passing merely enabling Bills—Bills in which we are not making the final decision ourselves, as the public generally expect us to do, but are giving the power to somebody else to make it. In this case, one has to speak with great deference and respect because the power is given, in the terms of the Bill, to His Majesty. At the same time, the principle remains the same. We know, after all, that His Majesty will be advised by a responsible Minister and that that Minister will take responsibility for whatever decision His Majesty reaches in this matter. But this is a question of public finance and, in such matters more especially, should there not be not an enabling Bill but a Bill in which the House takes the final decision? It is important, therefore, that my hon. Friend should have an answer to the point he made.

Mr. Jay

I am advised that in practice this wording leaves no discretion in the hands of the Executive to vary the salary. It may be of interest to both hon. Members to know that the Exchequer and Audit Departments Act of 1866 reads in precisely the same way, in Section 4: Her Majesty may by such letters patent grant to the persons therein … and so forth. In fact, the salary has never been varied from the figure in the relevant statute. I am advised that the only reason why the word "may" is used is that it is the appropriate form of words in a Clause where the Sovereign is mentioned.

Mr. Pitman

The hon. Member for Sowerby (Mr. Houghton) and others in the House are very interested in this question of the principle of the introduction of legislation in order to increase remuneration of this kind. May we have an assurance from the Financial Secretary that, in opposing the second Amendment which I put down, he intends that the Government should introduce any such legislation if and when it should be desired?

Question put, and agreed to.

Clause ordered to stand part of the Bill.

Clauses 2, 3 and 4 ordered to stand part of the Bill.

Bill reported without Amendment; read the Third time, and passed.