OFFICERS' RETIRED PAY

HC Deb 19 December 1952 vol 509 cc1808-32

11.52 a.m.

Mr. George Wigg (Dudley)

The matter which I wish to raise is concerned with the retired pay of officers.

Mr. Speaker

Order. Hon. Members should pass from the Chamber quietly.

Mr. Wigg

I wish to raise the question of officers' retired pay and widows' pensions. On Wednesday the Parliamentary Secretary to the Ministry of Defence gave the House information resulting from the Government's consideration of widows' pensions. I was extremely gratified by that announcement. It marked a very considerable step forward. The abolition of the means test for officers' widows must be welcomed by all who have the interests of the Services at heart.

May I also declare an interest? I was a little surprised and pleased when I heard the Parliamentary Secretary announce that widows of other ranks would receive some benefit from his announcement. When I concerned myself in the first instance with these matters I never thought that my widow would derive any benefit, because I am in receipt of an N.C.O.'s pension which was revised upwards in 1946 as a result of my commissioned service and I thought therefore that I was outside the scope of any revision. But the announcement the Parliamentary Secretary made will bring my widow some advantage, but this gain will be shared by hon. Members opposite, so my advantage will be shared in all parts of the House. But, of course, I cannot rule out the possibility that, if the Government carry through a revision of retired pay, I may benefit and it is in accordance with the traditions of the House that I should declare my interest in the matter.

The story which I have to tell starts in September, 1919. I remember it very well indeed. I was serving as a private soldier and I remember the excitement which came to the barrack room when rates of pay of other ranks were increased. I was not then aware of how officers were affected, but Army Order No. 324 of 1919 increased officers' rates of pay, and increased their rates of retired pay. But in that Army Order there was this condition: The new rates shown in the following tables are granted in consideration of the present high cost of living, and the rates of pay, half pay and retired pay will be subject, after five years, to revision either upwards or downwards to an extent not exceeding 20 per cent. according as the cost of living rises or falls. After the 1st July, 1924 a further revision may take place every three years. So in 1924 there was a revision, and so on every three years; subsequently the revision took place every six months.

That procedure continued until 1932 when, in an Army Order of that year, the Government announced that they proposed to consolidate retired pay. They did not introduce immediate consolidation. They announced the principle, and then for some months it varied until it reached a point 9½ per cent. below what it was when the rates were announced in 1919. Finally, by Army Order 182 of 1934, consolidation at 9½ per cent. was introduced as a permanent feature from 1st September, 1934.

It should be noted that the undertaking contained in the 1919 Army Order was made under the authority of no less a person than the present Prime Minister. He was then Secretary of State for War. He encouraged young men at the conclusion of their war service to take up the profession of arms as their career on the understanding that their pay and retired pay would be linked with the cost of living.

I must make it quite clear that the Prime Minister was not a Member of the Government when they departed from that principle. That departure was a thoroughly retrograde step and in its train has brought untold hardships and a great sense of injustice. I should have thought it was in the interests of the Government no less than it is in the interests of the Army that the sense of injustice, which lingers in the minds of all who are affected by the decision to consolidate in 1934, should be removed at the earliest possible opportunity.

I have here a considerable number of letters which have been sent to me as a result of supplementary questions which I put in the House. I shall not weary the House with them, for they all say much the same thing; they say, "We entered into an agreement with the Government of the day but when we had served 25, 29 or 30 years"—or whatever the case may be— "we thought we were going to get a certain sum. Instead, we find ourselves with less today than we got in 1919 or 1929"—or whenever they happened to retire.

If one examines the link with the cost of living on the formula contained in the 1919 Army Order, one finds this: that, taking the cost-of-living index as 100 in 1935, when the consolidation rates were introduced, the cost of living is today two-and-a-half times that figure. These are not my figures; I went to the statistician in the Library, whose services are kindly placed at our disposal, and I put the problem to him; and he tells me that, in terms of the purchasing power of the £, whereas the £ was worth 20s. in 1935, it is today worth 8s. That means that the cost of living today is two-and-a-half times the figure at the time of consolidation.

It does not mean that the rates of pension for these men should be two-and-a-half times as great. All I am asking is that the Government should put into operation the principle under which these officers began their service in 1919—in other words, give a tolerance of a 20 per cent. increase over and above the 1919 rates, which, in effect, would be a 29½ per cent. increase over present rates.

One can argue, as the Minister of Defence argued, that the economic conditions of the country are such that we cannot bear the cost of this increase. But the cost is not very great. In June of this year, in reply to my Question, the Parliamentary Secretary to the Ministry of Defence told me that it would cost £370,000 to bring the rates of all officers who retired before 1946 up to the 1946 figure. Again, the numbers are not great. Nevertheless, although the numbers are not great, the sense of injustice exists, and I submit that that could easily be remedied.

I do not want to take up too much of the time of the House, so I shall confine myself to this plea. I am not asking for sympathy or for pity; I am not asking for anything in the spirit of Christmas; all I am asking for these officers is justice. The Government must recognise that this plea is on an all-party basis. No one on this side of the House seeks to make capital out of it. Hon. Members on both sides of the House have worked together to reach the point of having this debate. We ask the Government to recognise that the 1919 principle was sound, that it worked well up to 1935, and that it was a thoroughly bad and unjust step to break the link between the retired pay and the cost of living.

Nor do I ask the Government to make an announcement today. I merely ask the Parliamentary Secretary to go back and consult the Prime Minister, who was the author of the original Army Order, and the Minister of Defence, and at least to give us today an undertaking that he will give very serious consideration to the points which we have made. As I have said, I make my plea on the ground of justice for the retired officers.

But may I say a word about the Army in general? I can assure the Parliamentary Secretary—and I know what I am talking about here—that nothing angers the ex-Service man—ex-Service officer as well as ex-Service ranker—who has served for a very long time, more than to see concessions given to the chap who has perhaps not yet entered the Army when there is denied even an element or feeling of justice towards the man who has completed his career. The principle of jam tomorrow is thoroughly bad—and I am not making that point because there happens to be a Conservative Government at present. The pages of Hansard since I have been a Member of this House contain many examples of the way in which I have "had a go" at my right hon. and hon. Friends—if I may use that colloquialism—because they have adopted the principle of giving something for the future and forgetting the man who has served.

I happen to be one of the victims. If I told the House what my pension was, I am sure they would get a shock. But I make no complaint about that. My grandfather got 10d. a day for his 25 years service—and he did not live long to enjoy that. At least I am better off than that, and my nephew and stepfather may perhaps get something out of this concession. I make no complaint on behalf of my own generation, but I say that the Government cannot go on taking for granted the goodwill of the ex-officer, the ex-warrant officer and the ex-N.C.O. They must give them a square deal, and the military families of this country—and this applies not only to officers but to other ranks—feel that their goodwill has been pretty heavily taxed during the last 30 years.

I therefore end by appealing to the Parliamentary Secretary to give us some hope that this matter will receive further consideration. If he will do that, I am quite sure that both his hon. Friends and my hon. Friends will be entirely satisfied.

12.7 p.m.

Mr. Anthony Marlowe (Hove)

The hon. Member for Dudley (Mr. Wigg) has made a very reasonable case with great moderation and fairness, and he has illustrated, too, that this is entirely a nonparty matter. If that needed reinforcement, it is abundantly reinforced by the fact that there is on the Order Paper a Motion standing in my name and the names of more than 200 hon. Members in all parts of the House—a Motion signed quite irrespective of party by hon. Members in every part of the House—calling for an increase in officers' retired pay.

The hon. Member for Dudley quite rightly founded his case on the Army Order of 1919. It is essential that it should be understood that the original principle was that there should be a sliding scale in relation to the retired pay of officers; and the principle was that, as the cost of living rose or fell, the retired pay should be adjusted to the cost of living figure. That principle was designed especially to meet such a situation as has arisen today. We have a rising cost of living and, just at the moment when the original machinery should come into operation to meet that cost of living, the principle having been removed, the purpose which it was intended to serve cannot now be achieved.

I do not want to take up a great deal of time, because the time allotted to this debate has already been considerably reduced, and I shall therefore omit a great deal of what otherwise I would have said. It is, however, important to bear in mind two principles—and the first is that the retired pay should be adjusted to the cost of living; and secondly retrospection. Here I want to deal with an answer given by the Parliamentary Secretary to the Minister of Defence on 19th November, when we raised the matter at Question Time. He said: … the policy consistently followed by successive Governments in refusing to apply retrospectively improvements in the codes of retired pay and pensions for the Forces cannot be varied."—[OFFICIAL REPORT, 19th November, 1952; Vol. 507, c. 1862.] I am sure that whoever put that into the mouth of the hon. Gentleman did not intend to be misleading, but it is quite untrue to say that the policy of retrospection has been consistently applied in this matter.

That is not the case, and I can give the simplest example. The actual rates which are in operation today were announced in this House on 30th July, 1951, by the right hon. Member for Easington (Mr. Shinwell) who was then Minister of Defence. He made an announcement about new rates which came into operation and he said there and then that those rates were retrospective as from 1st September, 1950. The right hon. Gentleman will no doubt recall what took place at that time and that the hon. and learned Member for Northampton (Mr. Paget) then rose in his place and said, "Why 1st September, 1950? Why not go further back?" The right hon. Gentleman, in effect, said in reply, "I cannot go further back than that." No doubt he had been told by the Treasury that that was as far as he could go.

But it is rubbish to say that there has been no retrospection in this matter. There has been an enormous amount of retrospection. Increases have been made from time to time following the principles which have been adopted in the Pensions (Increase) Acts. In 1944, 1947 and again this year there have been Pensions (Increase) Acts. These pension increases do not apply to the Armed Forces but to a number of servants of central and local government; but the practice has been for a Royal Warrant to follow the principle of these increases. In effect, what is done—subject to a means test and certain conditions as to age and so forth—is to give some increase, and every one of those increases has been retrospective.

They have, however, been subject to the various income levels, and the general effect is that owing to the amount at which the maximum permitted income was fixed these increases hardly touched any of the retired officers. That is where this problem arises. It is only the retired captain, if he is single, or some retired majors, if married, who have benefited at all from Royal Warrants which have followed the principle of the Pensions (Increase) Acts.

It means that all those officers—and many of them are the best regimental officers—who have risen to lieut.-colonels and above have not received any increase. I refer to those Warrants which have followed the Pensions (Increase) Acts only to show that they have been retrospective and that it is quite ridiculous to attempt to maintain the argument that there can be no retrospection in this matter.

I want to deal with what may be a perfectly legitimate comment in this matter. It may be said that if we make out the case for the retired officers it is going to cost the Treasury a great sum because it will be followed by a demand in relation to other ranks. I am certainly in great sympathy with any increase which could be obtained for other ranks, but there is a complete distinction between the two cases.

There is no doubt whatever that the case for the officers stands unique. It is in a category by itself at present, in that because of the reasons to which I have referred the Warrants which have followed the principle of the Pensions (Increase) Acts have already granted several increases to the other ranks. I agree that they are not enough, but the other ranks have certainly had some increases. The officer is the only person who not only has had no increase but has, as the hon. Member for Dudley has pointed out, been frozen at 9½ per cent. below the original rate.

I doubt whether one could find any other class of people who have to exist on an income which is 9½ per cent, below the 1919 level. That is what puts the officers in a special category of their own and that is what justifies us pressing their case in distinction to any others. I should be quite prepared to argue the case for the other ranks on its own merits on another occasion; but that is a different case.

Lieut.-Colonel Marcus Lipton (Brixton)

And this would cost only £370,000.

Mr. Marlowe

It would cost £370,000 at 1946 rates, though I understand that it would cost a good deal more to bring the pensions up to the rates which became operative at 1st September, 1950, and which were introduced by the right hon. Member for Easington. But, even so, the maximum cost is £2 million, and I would say that even in these difficult times it is not really asking too much to devote £2 million to those men who have served this country and who deserve so well of it.

It is not a question of expenditure which is going to increase from year to year. The amount involved must be a diminishing one every year. The most hard-hit of these people are the older ones who are unable to earn a living by any other means, men of 65, 70 and over who cannot supplement their incomes by other earnings. They have only a few years left to them and it will not be for long that they will remain a charge on the Treasury.

The Parliamentary Secretary, no doubt on the instructions of the Treasury, has sought from time to time to put up a defence to this claim on the grounds that once this door is opened there will be a whole flood of claims from other directions. That is a classic Treasury argument when any claim is made upon them. The Treasury are in perpetual fear of opening any door for fear of the bogeys which they may find behind it when they do; but there is no substance in that defence in this case, because there are no comparable claims. This claim stands by itself.

At one time it was said that once this was accepted there would be floods of claims from all the civil servants, and that even the retired postmen would have their claims. But that is not true. All those claims have been met by the Pensions (Increase) Acts, but this claim remains by itself. There is only one case which could possibly be considered as comparable to that of the retired officer of the category with which we are dealing and that is the higher grade civil servant. But there is a very considerable distinction between his position and that of the retired officer.

First, the civil servant does not have to retire until he is 60. Many Service officers have to retire at an earlier age than that—at 48 or 50—very often at an age when their children are still of school age and are a most expensive burden upon them. But the civil servant does not have to retire until he is 60, by which time he has that heavy expenditure behind him.

Secondly, the civil servant's pension is adjusted according to the last three years of his service, and by the time he is 60 he has reached the higher grades and receives an amount which is considerably higher than the average retired pay of the men we are talking about. Although it is possible to say in principle that if we increase the retired pay of the officer we must also increase the pension of the retired civil servant, the fact is that the civil servant has not the same problems and he is already on a higher level of pension. Therefore it is again perfectly easy to distinguish this case from any other existing case.

I am going to leave out much of what I should otherwise have said, but I have found that this matter is of particular interest to my constituents. Many retired officers live in my constituency and are finding life very hard. Since I first took an interest in this matter I have been overwhelmed with letters from similarly placed officers all over the country. In addition, I am glad to say that many of us have had the help of the Officers' Pension Society in getting material together and in keeping informed on these matters. I am sure my hon. Friend the Parliamentary Secretary has the courage to go to the Treasury and say, "This is a class of people which stands by itself for your consideration, and we put forward their case so that you may do justice to people who have served their country well."

Hon. Members in all parts of the House are grateful for what my hon. Friend has achieved so far with regard to widows' pensions. That was a step forward, and we are very grateful for what has been done in that direction, but it is only half the case. This matter has always resolved itself into two parts, one the question of retired pay, and the other the question of the widows. My hon. Friend announced some time ago that he would do something for the widows, and, therefore, I did not include them in the Motion on the Order Paper, but confined it to retired officers. It is important to note that the 200 odd signatures to that Motion are limited to the question of retired pay.

As I say, my hon. Friend has done well for the widows, and I think we must try to support him in doing still better in the battle which I have no doubt he will have to fight some time or other with the Treasury. I am certain that he himself is in sympathy with this matter, and I have no doubt that if it rested with him alone this increase would be granted. But, as one knows, there is always the Treasury to be fought in these matters.

I hope my hon. Friend will proceed in the matter fortified by his knowledge of the feeling that exists throughout the country on this point. I am sure he knows that he has the full support of hon. Members on both side of the House in approaching the Treasury on the subject, and in ensuring that justice is given to the people concerned who we all agree are really deserving of the best we can do for them.

12.23 p.m.

Mr. Stephen Swingler (Newcastle-under-Lyme)

intend to be very brief because I realise that we are running well behind time. I want, first of all, to say to the Parliamentary Secretary that we are thankful for small concessions, and that all who speak this morning are grateful that, as a result of the representations made by the all-party deputation to the Ministry, he has recognised the merits of the case put forward on behalf of widows' pensions and has done much to improve the position of widows and to remove many of the anomalies which formerly existed. This is in line with a tradition established after the war, since when so many improvements have been made in pensions generally, and so many anomalies have been removed, particularly in the Ministry of Pensions itself.

I merely wish to make two points. We are concerned this morning with the question of the retired pay of officers, because this is a section of the community that has been left out of all previous improvements. We are naturally concerned with all ranks and all types of pensioners, and with all people in retirement. But it is quite clear, as the hon. and learned Member for Hove (Mr. Marlowe) pointed out, that the other ranks have had a series of increases in pensions, and that many other improvements have been introduced for other types of people in retirement.

Not only have the people for whom we are speaking this morning had no improvement in their position since the end of the Second World War, but they were in a worsened position even in the '30s. That is why we are pressing their case. The second thing is a very important principle. We are concerned with the fact that whenever the Treasury considers these matters, cuts or reductions are always made retrospective whereas increases and improvements are always made prospective, and that is what has happened in the matter of the retired pay of officers.

When the cost of living went down between the wars, the Government of the day were enthusiastic enough to consolidate retired pay at a reduced rate, but when, at the end of the last war, it was decided to raise the pay of officers, it was done only for those who qualified in 1950. Therefore, these people are left in a wholly unjust and anomalous position.

Regarding the cost, my hon. Friend the Member for Dudley (Mr. Wigg) mentioned the figure of £375,000 as being the amount involved. I think all hon. Members will admit that that is a very small sum. I feel that we must be concerned this morning to do full justice to this section of the community and must appreciate that if this case is to be properly met, these retired officers should be brought up to the 1950 rates. That would only involve an amount equal to what we are spending every 12 hours on the defence budget. When we consider that sum in relation to the general budget, we see how very small it is.

The hon. and learned Member for Hove pointed out that to do justice to this section of the community would not necessitate an increasing sum of money being spent. All hon. Members who have been concerned with this matter must have received considerable correspondence from all over the country on the question. One of the important factors here is that there is no heavy pressure group which can put forward this case on behalf of the people concerned. We are much obliged to the societies that exist for the purpose of representing the interests of this section of the community, but they do not amount to a powerful body when it comes to exercising pressure on the Treasury.

I am sure that all hon. Members who participated in the all-party deputation have received many letters on the subject. I will read to the House an extract from a letter I have received from a distinguished naval officer. He puts the case in a nutshell, and much better than I could ever hope to do. In the letter he says: I am an ex-officer myself, drawing a pension after 42 years of service, including 10 years of war, but it is not because of this that I write, but because of others—my brother officers—who are similarly situated, living on their old scale pension with more commitments than I have, and struggling to meet them with a reduced purchasing power of money. There are two points in this matter on which the public are not fully aware. The first is that, taken generally, officers who retired on pension before 1950 bore the full brunt of active service in two world wars, which does not apply so much to those who retired after 1950. Their share of responsibility in war was infinitely more, and their personal risks much greater; they, certainly in World War I, bore the full heat and burden of the day to a degree much more than those who came later. The second point is that those retired before 1950, because of advancing years, are still more at a disadvantage when they try to augment their pension, as I know from many personal experiences … He concludes by saying: We have no means of putting forward our case to an unsympathetic and cold-blooded Treasury, except through public-spirited men like yourself who have the courage to speak up for us in the House of Commons. When one receives letters like that, one feels a weight of responsibility in pressing the matter upon this "cold-blooded Treasury" or through the Ministry of Defence in an endeavour to obtain justice to a section of people who, as I have said, have no great weight among the voting public or any powerful pressure group to come to their aid.

That letter was written by a man who was a former President of the Royal Naval College at Greenwich, the holder of the V.C. and the D.S.O., and who has rendered very distinguished service to his country. I hope that the Parliamentary Secretary will be able to indicate this morning that he is prepared to do for these men what the Government have done for the widows.

12.30 p.m.

Major W. Hicks Beach (Cheltenham)

I should like to join in thanking the Parliamentary Secretary for the concession he has been able to give to the widows. He is certainly deserving of their thanks. I have already received many letters from widows saying how much they appreciate it. I think that this may be an opportune moment to pay tribute to Lord Jeffreys for the hard work he has done since 1945, and when he was a Member of this House before going to another place, to improve the lot of these widows.

The hon. Member for Dudley (Mr. Wigg), in his very cogent speech, dealt very fully with the terms of the 1919 Warrant, but there are some other considerations that ought to be before the House concerning the terms of the Service Orders which were published at that time—1919. I should like to draw the attention of the House to Admiralty Fleet Order No. 2483 of 1919, which, compared with some Service Orders, was commendably brief and commendably plain. It says as follows: It has been decided that 20 per cent. of the new rates of retired pay for officers shall be considered as due to the present high cost of living, and shall be subject after five years to change, either upwards or downwards, according as the cost of living rises or falls. The revision thereafter to take place every three years up or down on the basis of the Board of Trade Prices. The Army Order of a similar kind, No. 324 of 1919, although it did not put it quite so strongly, said this: These rates will be subject after five years to revision upwards or downwards to an extent not exceeding 20 per cent. according as the cost of living rises or falls. The Air Ministry Order No. 1003 of 1919 covered similar ground, and was almost identical except for the opening words: In the light of the high cost of living … I mention these three Orders because they make abundantly clear to these Service officers, even if they did not study the Warrant, what the intention of the Orders was.

The hon. Member for Newcastle-under-Lyme (Mr. Swingler) referred to the numerous letters he had received. I have, of course, received a great number, too. I shall not weary the House by reading them, but I should like to refer to just two typical cases mentioned by the writers because that will help the Parliamentary Secretary to give the concession on the lines we are suggesting.

Here is a letter from a man who served 20 years in the Royal Air Force, 10 years in the ranks and 10 years as an officer. Here is a man who is obviously a go-ahead type, starting in the ranks and getting a commission—a type we want to encourage. He retired in 1945 just under 60. His pension on the present scale, the 1919 scale as stabilised, amounts to £119 9s. 2d. That is not a very great reward for a man who has given 20 years to his country.

Here is one other example of a higher grade pension, so that it cannot be said that I have been quoting only the lower examples. This is the example of a lieutenant-colonel who had 39 years' service. He commanded his regiment abroad for a very considerable period, and retired in 1939. Then he rejoined and saw service in the Royal Air Force on a home station. Unfortunately, he had to commute part of his pension to provide himself with furniture and the like when he retired in 1939. He is now seeking to maintain himself, his wife, and his three sons, of whom two already have commissions and the third is going shortly to Sandhurst, on a pension of £534 15s. a year. I have quoted this, one of the top grades, because I do not think it can be seriously said by anyone that a pension of £534 for a man who has given 39 years' service to his country is a proper reward.

There is another point. Let us suppose for a minute what would be the position of a man who entered the service of a big firm, a private firm or anything else, and took on an executive position on the basis that they were going to pay him a non-contributory pension, and that then they deliberately broke their contract, as was done by the Government in 1935? The firm, in my humble judgment, would be liable to a civil action. I am not suggesting to the Parliamentary Secretary that I am going to rush off and issue writs against him, because this does not apply in the case of a soldier, but if we had in civilian life a parallel case with that of these soldiers there would be a right of action. I think that that is a very important consideration relevant to this matter.

I want to be as constructive as I can, and, therefore, I have two or three suggestions to offer to the Parliamentary Secretary in order to solve the problem. It is clear that what we want first is to bring the pre-September, 1950, pension up to the 1952 level. That is the only fair and reasonable step. If my hon. Friend finds he cannot do that at the present time I would suggest that there is one other possible solution. It would not be so good; it would not produce so high an increase in pension; but, at least, it would put the pension back on the basis of the original contract.

I do not see why they should not abolish the 1935 Royal Warrant Order and simply give these retired officers whose pensions are 9½ per cent. below the 1919 rate a cost of living increase, to give them back the 20 per cent. revision on the cost of living basis. I have not the figures that my hon. Friend has or could obtain, but I calculate that that would cost the Treasury less than increasing the pension up to the 1952 values. It is not a satisfactory, but it is a possible, solution.

Another possible solution, which again would not be so good, but would assist officers who are living in great trouble through old age, is this. Would it not be possible, if the other suggestions cannot be adopted, to say that, where an officer attains the age of 60, he should be paid the 1952 level of pension? That would mean that quite a number of officers would not get the concession, but it would mean that those who are at a very difficult age, and who cannot get employment, would be given assistance.

We hope we are going to get some concession, and I also hope that this debate will not be regarded as one of those that are sometimes called "blowing off steam" debates, because I can assure my hon. Friend that hon. Members on both sides of the House feel very strongly on this point, and propose to take any legitimate Parliamentary action we can, if my hon. Friend is not able to give us the concession today or to promise that something will be done.

12.37 p.m.

Lieut.-Colonel Marcus Lipton (Brixton)

I shall be unusually brief because, in my submission, the case that has been made out is unanswerable. I will content myself with quoting one instance, because it is a case with which I am personally acquainted. It is that of an officer who was camp commandant at the first headquarters to which I was posted with a commission. Here is a man who was a ranker officer who had served for 25 years in the Regular Army, and who was finally discharged with the rank of W.O. Class I in April, 1937.

When he retired in April, 1937, he had a Service pension of £2 5s. 6d. a week. This excellent fellow immediately joined the Territorial Army, and when the Second World War broke out he was embodied in the Service, with others of us who were in the Territorial Army before the last war. He served in a commissioned rank from 1939 to 1948, and in that way put in another nine years' service as an officer on top of the 25 years' service he had done in the ranks. As a result of this additional nine years of officer service in the second war, his original Service pension of £2 5s. 6d. was brought up to £4 10s. ld. After 34 years on the active list, including two world wars from start to finish, with nine years as an officer in the Second World War, he now has to live and maintain his wife on £4 10s. Id. a week.

He left the Service with the rank of major, and earned a decoration. I would also add that he carried out the whole of his officer service under a disability, because he had lost a leg towards the end of his other rank service. There is no disability element in the Service pension to which he is entitled because, unfortunately, this is one of the cases in which it was not possible to prove that the loss of the leg was due to or aggravated by his military service.

He is now 56. It is difficult enough to find work at that age, with only the experience of the professional soldier behind him, and more so with only one leg. Several years ago he developed angina pectoris. His wife and himself have to live on this miserable amount of £4 10s. ld. a week. What savings they have are nearly exhausted. What can a man serving the ranks for 25 years, with this additional service in the last war, with frequent changes of duty stations, separation from his wife, and that sort of thing, possibly save in that time?

The officers on behalf of whom both sides of the House are appealing are people who, for the most part, served during two world wars, unlike the post-1950 officers who are in a much better pension position. It would cost £2.1 million to give this concession. I hope that the Parliamentary Secretary will not adopt the rôle of defender of the Government against the legitimate request that is being made to him, and that as a result of this all too brief discussion we are having today he will be able to announce that some concession will be made.

12.42 p.m.

Brigadier Christopher Peto (Devon, North)

I have to make the customary declaration as to interest in this. I am one of the officers to whom the hon. and gallant Member for Brixton (Lieut.-Colonel Lipton) referred, having served during both world wars, practically the whole of the first and the whole of the second. I retired from active service in November, 1946, so I am one of those under the new code of 1946 (Cmd. 6750), which is applicable to those who retired after 19th December, 1945. Having declared those interests, I shall be as brief as possible.

The three Questions that were asked and replied to in this House by the Parliamentary Secretary on 19th November were, to my mind, most important, and the reply was most unfortunate. To use the words of my hon. Friend the Member for Twickenham (Sir E. Keeling), it was just a plain, blank negative. The effect on the feelings of those to whom the Questions referred, the ex-officers who had retired after many, many years of faithful service, was indeed unfortunate. Through that answer, they felt that the Government were entirely unsympathetic, and that their case was not well understood. I hope those two criticisms will be taken note of in the reply that is made today.

The Government rest their case for refusal on two so-called principles. The first principle is that no code can be retrospective. That has already been shown by my hon. and learned Friend the Member for Hove (Mr. Marlowe) to be entirely false. Practically all the codes are retrospective. Certainly the 9½ per cent. cut below the 1919 level in 1935 was nothing but retrospective. That principle, therefore, does not hold water.

The other principle on which the Government rest is that if something is done for one it must be done for others; that if an increase in pension is given to officers a similar increase will immediately have to be given to retired civil servants. There again, I maintain that for many reasons, on which I could elaborate at length, that principle is entirely false. For example, does the Parliamentary Secretary realise that the mode of life of officers on the active list in any Service is entirely different from that of a civil servant who works in his office and has his little house nearby to which he can return every evening? I have no doubt he does realise that, because he has been on service himself.

Again, does he realise that the average retiring age of a civil servant is between 60 to 65, whereas for a major or lieutenant-colonel retiring after perhaps 25 years' service the average retiring age was 40 or 45 to 50? In other words, a civil servant has the advantage of about 15 years more service on full pay than the ex-officer. Not only does he have that advantage, but he has a considerable accumulation of prospects when he retires. He has a little house and his furniture, his children are educated—everything he has been working for. Whereas an officer who has been kicking around the globe has nothing and no prospects of getting a job—unless he becomes a Member of Parliament, as I did. It is obvious that the two cases, that of a civil servant and that of an officer retiring, are by no means parallel.

I do not wish to keep the House for more than another minute because so many others wish to speak, but I would say this, in conclusion. These old officers do not expect the Government and a grateful country to give them charity. They do not ask for charity. They do not ask for anything the country cannot afford, to use the words of the Minister of Defence on 19th November in another place, "in the present economic and financial position." We do not ask the country to overstrain itself on our behalf, but we do ask for justice, and for my part, whatever the cost and whatever the inconvenience to the Government, I shall not rest until we get a satisfactory answer.

12.49 p.m.

The Parliamentary Secretary to the Ministry of Defence (Mr. Nigel Birch)

We have had a very interesting debate on a subject which, very naturally, raises the strongest feelings. I am glad that a general welcome has been given to the scheme for Service widows and children which we were able to announce this week. It is a matter of general gratification, I think, that, in certain unfortunate circumstances, the wife of the hon. Member for Dudley (Mr. Wigg) might benefit. It is good that we have been able to get rid of many old-fashioned restrictive conditions, and that we have been able to extend the scheme to the widows of long-service other ranks. We have also been able to give slightly better benefits.

Pensioners never get all they want; and they certainly never get all we should like to give them. In this case they have got something more. It is fair to point out that the basic rates and conditions for widows' pensions had been unchanged for over 100 years. Therefore, the position of the ordinary Service widow's pension was different from that of any other class of pensioner. I only wish that I could today give equally good news about the pensions of officers who retired before 1st September, 1950. If the House will bear with me for a minute or two, I think that it is worth while looking at the history of this matter.

Mr. A. G. Bottomley (Rochester and Chatham)

Would the hon. Gentleman tell us the cost of the widows' pensions?

Mr. Birch

In the first year, the cost will be approximately £600,000 more than the cost of the existing scheme.

I was about to turn to the history of this matter, because it has ben raised by many hon. Members. After the First World War, retired pay rates were fixed in 1919. During the First World War, there was a very steep rise in prices, and it was held at the time that the pension code was worked out so that 20 per cent. of the retired pay rates was to be attributed to the increased cost of living at the time they were granted. This element of 20 per cent. was to be subject to periodical revision, both upwards and downwards.

In fact, as the House knows, owing to the very sharp fall in the cost of living after the First World War, all the subsequent changes were made downwards. In this debate, and during many debates of the last 17 years, this question has come up again and again—the question of the so-called 9½ per cent. cut—because when pensions were stabilised in 1935, they were stabilised at a rate of 9½ per cent. below the basic rate announced in 1919.

It has been held that the stabilisation in 1935 was not consistent with the Warrant, and was a piece of sharp practice on the part of the Government of the day. It has been persistently maintained by Governments of all complexions ever since that, in fact, there was no breach of the letter of the Warrant of 1919. I myself believe that was true. If we are to hold that there was a breach in the letter of the Warrant, we have to maintain that the word "may" has the same meaning as the word "will," and I do not think that any one can do that. The hon. Member for Dudley may be killed by lightning, but that is not the same thing as saying that he will be killed by lightning. I do not think the letter of the pledge was broken.

Nor, at the time it was made, was the settlement really a shabby one. When the 1919 Warrant was issued, the cost of living was 107½ per cent. above what it was in 1914. There was then a big fall. At the time of the 1935 stabilisation, the cost of living was only 40 per cent. above the 1914 level—a substantial fall—whereas in actual fact the pensions were stabilised to correspond to a cost of living index of 55 per cent. above 1914, and not 40 per cent.

To say that when the 1935 stabilisation became effective it was foreseen that there would be a long, costly war; to say that it was foreseen that that long and costly war would be followed by six years of Socialist Government; and to say that it was also foreseen that during that period a vast re-armament programme would be put into force—to say all these things could have been foreseen at that time, is, I think, ascribing to the Treasury more prescience and more wisdom than that institution would really be entitled to lay claim. In fact, the cost of living did not rise appreciably until the war started.

I think that it is wrong to say that the 1935 stabilisation did involve a breach of faith, and that it is also wrong to say that, at the time it was effected, it was a shabby one. It is also fair to remember that at the time it was effected, the climate of opinion, both of officers in the Army and officers in the Civil Service, was in favour of stabilisation. They were sick of having reductions, and they wanted stabilisation. After that stabilisation, there were various minor adjustments, but there was no general revision of the retired pay code until 1950.

Brigadier Peto

Has my hon. Friend the figure for the cost of living in 1935 as compared with today?

Mr. Birch

No.

Brigadier Peto

The figures I have show that if 1914 was 100. 1935 was 143 and 1952 was 235.

Mr. Birch

I am not contesting my hon. and gallant Friend's figures. What I was discussing was whether this was unfair at the time it was made. I am coming to the subsequent history.

I was saying that there was no new pensions code until 1945. The object of the 1945 code was to put all the three Services on the same basis. We always tend to talk in terms of the Army, but we put Navy, Army and Air Force officers on the same basis, and this code, generally called the 1945 code, laid down that there were to be no automatic rises or falls in pensions as the result of changes in the cost of living. That was specifically stated in paragraph 69 of Cmd. Paper No. 6750.

Very many officers retired between the wars and were not entitled to the 1945 new code—which, as my hon. and gallant Friend the Member for Devon, North (Brigadier Peto) rightly says, applied to those who were still in the Services or who joined after December, 1945—but it is relevant to remember that a large number of these officers did serve in the Second World War and had their pensions re-assessed as the result of that further service.

May I say one word on the question of retrospection? I think that is a point about which there is some confusion. Both in the 1945 code and the 1950 code, a date was laid down after which an officer had to serve in order to get the new rates. In bringing in a new code, there has to be an effective date of some sort. None of these codes have ever been brought in with unlimited retrospection and, therefore, to say that the principle of retrospection was departed from in either of these codes is not really valid. In 1950 there was a fresh review of pay and pensions.

Mr. Marlowe

Matters affecting merits, conditions and means tests applied in the Pensions (Increase) Acts have been retrospective in every instance.

Mr. Birch

I am coming to the Pensions (Increase) Acts. I was saying of pensions codes that there always has been a definite date. When the 1950 code came in—and I should like to emphasise this—it was laid down in paragraph 2 of Cmd. Paper No. 8323 that its object was to look to the future. I know that hon. Members have objected to that. It was laid down that its object was to stimulate Regular recruitment and to induce those on Regular engagements to stay on for a long Service career. So much for the code.

As my hon. and gallant Friend pointed out, there have since that date been a number of Pensions (Increase) Acts, which have been extended to the Services by the appropriate Prerogative Instruments. There have been Pensions (Increase) Acts in 1944, 1947 and 1952. The 1944 and 1947 Acts provided not only for hardship increases, which were subject to an upper income limit, but they also provided certain automatic increases.

The automatic increases provided by the 1944 Act were of between 10 and 5 per cent. for persons receiving up to £600 a year, while under the 1947 scheme increases were allowed for pensions of up to £787 10s. a year. These increases, incidentally, did not apply to those who were on the 1945 code, because their rates were higher than both the 1919 rates and the 1935 rates.

The last Pensions (Increase) Act was in 1952. When the present Government introduced it, they made it clear that in their view the economic condition of the country made it impossible to extend pensions except in the cases of severe hardship. It is true to say that the 1944 automatic increases, as amended by the 1947 increases, substantially restored the 9½ per cent. reduction to the great majority of cases—in fact, to all except those drawing the higher rates of pension. The number of officers who retired before the last war and were not re-employed during it, who have had no increases during or since the war, amount to fewer than 400, and these are officers in the senior ranks drawing the higher rates of retired pay.

It is often said that Service pensioners have come off very much worse than Civil Service pensioners and that the 9½ per cent. cut was not applied to Civil Service pensioners. That is not true. The stabilisation of Service pensions followed a similar stabilisation for Civil Service pensions which resulted from the Tomlin Report.

Major Hicks Beach

Is my hon. Friend suggesting that the stabilisation applied to all civil servants? My information is that it applied only to certain civil servants in the higher grades.

Mr. Birch

I am not saying that it applied to all of them. What I was pointing out was that the stabilisation followed the Civil Service stabilisation.

Mr. Marlowe

That is exactly the point about which I pressed my hon. Friend. I said that the only comparable case was that of higher grade civil servants.

Mr. Birch

What I am saying is that the stabilisation of officers' pensions followed similar stabilisation in the Civil Service.

Major Hicks Beach

Only in certain cases.

Mr. Birch

There is one other point with which I should like to deal. There has, very naturally, been a good deal of talk about older officers. Although the point has not been made today, it is often said to be very unfair that people cannot get any of these pensions increases unless they are either 60 years of age or disabled. One must recognise that it is very hard, but it is fair to point out that, particularly in the case of the lower ranks, Service pensions contain a substantial element of compensation for the early termination of a career. An officer, of course, draws his pension for a good deal longer than a civil servant.

Miss Irene Ward (Tynemouth)

He does not want to.

Mr. Birch

He does, in fact, do so. I also recognise the extraordinary difficulty of officers in getting jobs, although a great many do obtain them. It would be a pity if we were to say that a man's earning life had ended when he retired before the age of 50.

I fully admit that these retired officers are in great difficulty. The basic reason is that we have had years of inflation and rising prices, starting in the war and continuing since. The trouble about inflation is that its effects are so capricious. It generally harms the sheep and only too often positively benefits the goats. The people who have been most harmed by inflation are pensioners of all sorts, including Service pensioners, Civil Service pensioners, people living on private pensions or annuities, or on the income of money they have saved and put into Government securities, and people living on fixed stipends or emoluments like members of the Church.

All these people have suffered very much, but it is hardly possible for a Government to put all of them back in the position they were in before. All these cases cannot be dealt with by Government and it is, perhaps, invidious to single out particular cases and to deal with them. The best thing that a Government can do is to stop the inflation continuing, and that is what we are bending all our energies to achieve. I hope that we will have the help of Members on both sides of the House in the things we are trying to do.

As already announced in the House, to bring all officers up to the 1950 scale would cost £2,100,000. If I understood the hon. Member for Dudley aright, his scheme would cost more than that. The figure of £370,000 which he quoted covered a narrower range of cases. The difficulty of the Government is not only that all increased expenditure adds to the dangers of renewed inflation, but that one concession definitely leads to another. Nothing would be more likely to prejudice still further the conditions of these people than a further large increase in Government expenditure.

I am, therefore, very sorry indeed to say that I cannot hold out any very substantial hopes that the Government will be able to do anything towards satisfying the claims which have been advanced during this debate—

Miss Ward

Monstrous.

Mr. Birch

—on behalf of retired officers of the Services. But I fully admit that the case which has been put today is a weighty one, and I can promise that it will be carefully considered by Ministers.

Brigadier Terence Clarke (Portsmouth, West)

In view of the thoroughly unsatisfactory answer, I give notice that I will raise this matter again at the earliest opportunity.