§ 10.25 p.m.
§ The Parliamentary Secretary to the Ministry of Supply (Mr. A. R. W. Low)
I beg to move,That the Draft Iron and Steel (Compensation to Officers and Servants) (No. 1) Regulations, 1953, a copy of which was laid before this House on 20th November, be approved.These Regulations relate to nationalisation. The No. 2 Regulations, which we shall come to in the second Motion, relate to denationalisation. The No. 1 Regulations provide for compensation to be paid by the Iron and Steel Holding and Realisation Agency to employees of iron and steel companies suffering loss of employment or loss or diminution of emoluments or pension rights in consequence of the nationalisation of iron and steel under the 1949 Act, but the Regulations themselves are made under the Iron and Steel Act, 1953, Section 24 (1, a) of which places an obligation on my right hon. Friend to make Regulations exactly for this purpose.
The House will remember that the 1949 Act, passed by the previous Government, gave the Minister of Supply power, under Section 41, to make such Regulations, but, in fact, no Regulations were made under that Act either by the previous Government or by my right hon. Friend. There was a simple reason for this. No one applied for any compensation, and those who know about these things were of opinion that no one would have any reason to apply for compensation. That 1096 is still the case, and it is, in our opinion, most unlikely that any claim for compensation will be made under these Regulations.
Nevertheless, the 1953 Act rightly made it obligatory to make such Regulations, and I am sure the House will want to have a short account of the effect of these Regulations before it gives its approval to them. Since the Regulations relate to nationalisation we thought it right to follow the pattern of compensation on nationalisation worked out by the previous Government. That seemed to us to be fair to all concerned. The basic provisions of these Regulations are, therefore, the same as the basic provisions in the compensation Regulations made by right hon. Gentlemen opposite on the nationalisation of electricity, gas and road haulage, and in some other cases such as those connected with the National Health Service and the National Insurance Act.
The most important of these basic provisions, which were discussed by the House at considerable length in the case of the electricity Regulations, and on a number of other occasions, are these. The first of the basic provisions is a qualifying period of not less than eight years' continuous service in the industry. No one who has not that eight years' service may receive anything under the Regulations.
Second, there is no entitlement under the Regulations to compensation in consequence of any disturbance that happens more than 10 years after the date of transfer to public ownership, that is, after 15th February, 1961. Third, claims must be made within two years of the loss. Fourth, 1097 a claimant with the eight years' service qualification is entitled to receive interim compensation for up to 13 weeks as soon as he makes the claim, while his claim for substantive compensation is being examined. That is an advance payment on account.
Fifth, if he fulfils the conditions for long-term compensation he is awarded compensation on the basis of his emoluments and length of service up to a maximum amount of two-thirds of his emoluments immediately before the loss. Sixth, if a claimant cannot establish a right to long-term compensation he will receive short-term compensation covering a total period of between 13 and 26 weeks, depending upon his age and length of service. Seventh, a claimant in respect of pension rights is credited with up to 10 additional years' service, depending on his age, and the amount of his pension, when payable, is increased accordingly. Eighth, compensation may be commuted, but only to a limited amount. Ninth, there is a right of appeal to a tribunal: in this case a tribunal appointed by the Minister of Labour.
On all these basic points there is no difference between these Regulations and the Regulations for nationalised industries. There are, however, two points of detail on which there are differences to which I should draw the attention of hon. Members. Both these differences relate to the weekly deductions which, where applicable, are to be made in calculating the amount of compensation. Both have been discussed and agreed with the Trades Union Congress.
The first difference is that where unemployment, injury or sickness benefit has to be taken into account, the deduction will be at the rate applicable to a person without dependants instead of, as in the previous Regulations, a deduction of two-thirds of the actual benefit claimable. This provision will be found in Regulation 8 (1, a), Regulation 13 (d) and Regulation 14, and avoids penalising claimants with dependants.
The second difference is that in calculating the interim compensation only two-thirds of any current earnings will be taken into account, whereas in previous Regulations on nationalisation the full earnings were taken into account. This encourages the claimants to take up em- 1098 ployment even at a lower rate of pay, and benefits them if they do.
I said, at the outset, that we did not expect any claims to be made under these Regulations. We hope, indeed, that this will be so and that our consideration of them tonight will prove to have been academic. But I can assure the House that in drawing them up, and in our consultations with the Trades Union Congress, we have proceeded exactly as if they were known to be of real importance. I hope that hon. Members will now be able to give them their approval.
§ 10.33 p.m.
§ Mr. G. R. Strauss (Vauxhall)
I have no doubt that the House will readily give its approval to these Regulations. I am aware that where there have been possible matters of dispute discussions have taken place on a most amicable basis between the Ministry and the trade unions concerned. I do not think there is any difference between them, and on this occasion there is no difference between the Government and the Opposition. I think the Regulations may be allowed to pass without further discussion.
§ 10.34 p.m.
§ Mr. Jack Jones (Rotherham)
I was interested in the concluding remarks of the Parliamentary Secretary, that the provisions of the Regulations would be purely academic and that there would be no claimants. May we agree that that shows the extent to which there was disturbance among the people to whom, we were told, there would be done this, that and the other under nationalisation? I am glad there is evidence tonight that the disturbances and displacements to which reference was made have also proved to be academic.
§ 10.35 p.m.
§ Mr. Low
I beg to move,That the Draft Iron and Steel (Compensation to Officers and Servants) (No. 2) Regulations, 1953, a copy of which was laid before this House on 20th November, be approved.These Regulations provide for the payment of compensation to employees of the iron and steel companies affected by the 1953 Act and to former employees of the Iron and Steel Corporation. We believe and hope that our consideration of these Regulations will be as academic as that given to the No. 1 Regulations.
§ Mr. Low
In compiling these Regulations we decided to follow as exactly as possible the line of the only other Compensation Regulations so far made on denationalisation, namely, the British Transport Commission (Compensation to Employees) Regulations, 1953. Since the House discussed those Regulations and approved them on 27th July I will not go into very great detail.
Some of the provisions of these denationalisation compensation Regulations are the same as those in the Regulations we have just been discussing, but there are some important new provisions.
Instead of interim compensation and substantive compensation, whether long-term or short-term, all subject to an eight-year qualification, we now provide, in these Regulations, for resettlement compensation, and for long-term compensation, each with a different qualifying period. The only service qualification necessary for resettlement compensation payable for loss of employment is either the holding of a permanent appointment, whether in the industry or the Corporation, or three years' employment in the industry and the Corporation.
The amount of compensation is calculated in the same way as the short-term compensation in the other Regulations we have just discussed. But whereas, under the old rule, the period of extension above 13 weeks for those of 45 years of age or older depended on the actual service performed after that age, we have provided, as did my right hon. Friend the Minister of Transport, that the extension period should depend solely on age. The reason for this is that it is obviously harder for an older man to get resettled. In this way, whereas a man of 45 or under could get resettlement payments for 13 weeks, a man of 58 or over could draw such payments for 26 weeks. That provision was welcomed by the House in July in the case of transport and it is hoped that hon. Members will welcome the change by which the resettlement payment is not confined only to those with eight years' service.
There is also an important change in the conditions under which the long-term compensation will be granted. Under the nationalisation Regulations it was necessary for a claimant to prove he had a 1100 right or expectation, under customary practice, to the payment of compensation in the event of discharge or reduction in earnings. In addition, he had to fulfil the qualification of eight years' service in the industry. Instead, as was done in the case of road haulage this year, we have provided the one qualification of eight years' service with one company or its predecessor in title. The House accepted this principle in connection with road haulage in July, and it is not necessary to remind hon. Members of the arguments. For claimants the change is an improvement.
My right hon. Friend has had consultations with the Trade Union Congress, as he did in the case of the No. 1 Regulations and there is no disagreement between him and them. I am afraid, however, that representatives of those former members of the Iron and Steel Corporation who are now employed with the Agency have not been willing to accept the Regulations as drafted. I had two very full meetings with them myself, and they say that special terms ought to be included to make them eligible for long-term compensation from which the eight-year qualification excludes them. But no such payment was given to the staff side of the Road Haulage Executive, nor was any special treatment given to the staff of the Electricity Commission, whose service was brought to an end in 1948. The same principles were applied to them as were applied to the staffs working in their industries. So, with iron and steel, I see no reason to draw up special qualifications and conditions for the staff of the Corporation giving them what amounts to preferential treatment not given to workpeople and staff of the companies in the industry.
We have, however—and this is important—provided, in effect, that the former members of the Corporation's staff who have transferred to the Agency may make a claim for resettlement when they leave the Agency. Without such a provision they would be barred from a claim had it been made later than 13 weeks after the date of these Regulations. They qualify for resettlement compensation, therefore, if they had a permanent appointment. They would have qualified for nothing at all under Regulations following the nationalisation pattern. But we hope very much that no former member of the Corporation's staff will need 1101 to make a claim at all. Certainly we hope that the 15—for that is the number—who have joined the Iron and Steel Board have been resettled. Of the other 45—there was a total of 60 at the time of the appointed day—one has already found new employment and 44 are now employees of the Agency.
I understand that the Agency will, when any member of the staff leaves, do all it can to assist him to find comparable alternative employment. Secondly, I understand that each member of the staff will qualify, under a scheme which the Agency will be introducing, for a cash payment on a stated date, or for a deferred annuity calculated by reference to service and salary. For this purpose, service with the Corporation will be added to service with the Agency.
My right hon. Friend has on several occasions paid his tribute to the work done by members of the Corporation and its staff, and he has been particularly anxious that all of them should be treated with full fairness after the demise of the Corporation. My right hon. Friend and I have, naturally, been personally interested in the provision made for these men and I hope that the House will agree that these arrangements of the Agency, which are made with the full approval of the Chancellor of the Exchequer, coupled with the resettlement compensation which is included in these Regulations, are fair provision for the staff. I commend the Regulations to the House.
§ 10.44 p.m.
§ Mr. G. R. Strauss
The Parliamentary Secretary has explained this second set of Regulations with his usual clarity and charm. We always enjoy hearing him speak. We are also very pleased to know that he, and, I understand, the Minister, too, have had discussions with the various parties concerned and have arrived at compromise agreements affecting all those who work in the various iron and steel companies; and that the T.U.C. are satisfied, broadly, that these Regulations are fair and have no desire to put forward, at this late stage, any views in opposition to these Regulations. We on this side of the House are also satisfied, as far as workers in the iron and steel companies are affected by the Regulations.
Having said that, I want to put before the House and the Minister what appears 1102 to be an injustice which has been meted out to these people who have been, up to recently, officers of the Iron and Steel Corporation. I warned the Parliamentary Secretary that I would be raising this matter and he, on his part, has been good enough to devote a part of his speech to this problem. I think he realises that it is a problem; and what is quite certain is that, whether the people have suffered an injustice or not, they feel strongly that they have. Indeed, they have a strong sense of grievance that they have not been fairly treated; and, as shortly as I can, I will tell the House why.
The Act passed earlier this year makes these provisions about compensation to members of the Iron and Steel Corporation staff. It says that:The Minister shall by regulation require the payment by the Agency, in such cases, and to such extent as may be specified in the regulations…This, I admit, gives him an opportunity of not making any Regulations of compensation to various classes. One class about which I want to say a word ispersons who are officers or servants of the Iron and Steel Corporation of Great Britain immediately before the appointed day, and suffer loss of employment, or loss or diminution of emoluments or pension rights in consequence of any provision of this Act.As this was specifically stated in the Act, people in the Corporation believed, as I think every hon. Member in the House believed, that the Minister would make Regulations giving some compensation to members of the staff in respect of loss, or diminution, of emoluments or pension rights. But, in fact, the Minister has not done so. Various reasons have been given by the Parliamentary Secretary, but I do not think that they are sound.
One reason he gives is that he is following the precedent set in the Road Haulage Executive and the Electricity Commission when their staffs were abolished. But I suggest that there is a considerable difference, and the precedent, not a good one. The staff of the Road Haulage Executive consisted mainly of people drawn from the road haulage industry; people who had existing pension rights which were maintained while they were members of the Executive's staff.
Similarly the staff of the Electricity Commission had mostly, I understand, pension rights inherited from their 1103 previous employment, whereas the staff of the Iron and Steel Corporation was composed of people not drawn from the industry at all. They were people recruited to the Corporation by means of advertisement and they came from all walks of life; none, I believe, came from the iron and steel industry.
Therefore, I suggest that there is not a close connection between the Road Haulage Executive or the Electricity Commission and the staff of the Iron and Steel Corporation for the sound reason—for such I believe it to be—that those in the two former inherited pension rights while those with whom we are concerned to night had none.
The second reason why it is said that there is no provision for these people is that the Agency will do its best to find other jobs for people when they leave it. That is all very well; so it may, but it is one thing to rely on another job being found by the Agency—which might fail—and quite another to have it laid down by Parliament that there shall be provision for loss or diminution of emoluments or pension rights. Therefore, I do not think that that argument is sound.
What do we find? When we look at Part III of the Regulations, dealing with long-term compensation for loss of employment or loss or diminution of emoluments or pension rights, we find that the Regulations which follow apply only to people who are working in iron and steel companies and not to members of the staff of the Iron and Steel Corporation. But, the Parliamentary Secretary says, they are, nevertheless, to get some compensation, called resettlement compensation, when they lose their jobs. That resettlement compensation will last for probably 13 weeks. It may be adequate, or it may not be, but it certainly puts these people in a separate category and does not entitle them, as they thought they would be entitled from reading the Act, to the same sort of compensation as people who are working in the iron and steel companies.
The argument is also put forward—and I agree that there is force in it; that it is unlikely that these people are to be employed by the Agency for eight years, and long-term compensation is 1104 only payable to people working in the industry after working there for eight years. That is perfectly true. But who can tell? We may have the disastrous situation in which a Conservative Government remains in office for eight years. We hope not, but it might happen.
It might also happen—indeed, it is likely if the present Government remains in office—that the Agency will continue in existence for eight years because it will not be able to get rid of all its iron and steel assets during that period. If that should happen, these people will not have the same rights of compensation as those working in the iron and steel companies, and they have a measure of grievance about that. But their case is much stronger in regard to no arrangements having been made for their loss of pension rights.
Again, I come back to Section 24 of the Act, where it is clearly stated that members of the Iron and Steel Corporation would receive compensation in respect of their pension rights which they might forfeit—
§ Mr. Strauss
I shall come to that in a moment.
Under the Act they are entitled to expect compensation in respect of pension rights which they will forfeit as a result of the passing of the denationalising Act. They joined the Corporation on the justifiable expectation that a pension scheme would be set up, because the advertisement which was issued inviting people to join the staff of the Corporation definitely said that a pension scheme was to be established.
As soon as possible, steps were taken to consider what would be the most appropriate pension scheme. But before it could be drawn up, the political situation changed, and it was considered that it would be unwise to go on with it any further in view of the possibility of denationalisation. But definitely, the people joined the Corporation in the belief that there was to be a pension scheme. I can quote the advertisement if the hon. Gentleman wants me to, but I do not want to waste the time of the House.
1105 Because no pension scheme was set up, the Corporation set aside a sum equal to 10 per cent. of the salary of each of the people concerned so as to form the nucleus of a pension scheme when one was established. There was no doubt, therefore, about the proper expectation that there was to be a pension scheme, or about the intention of the Corporation to set one up as quickly as possible. But, under these Regulations, the people will not get their pension rights which they were led to expect they would enjoy, or the compensation in respect of those pensions which they were led to expect they would receive under the Act.
It appears to me that there has been an injustice there. We are told that the staff concerned are to get something out of the pension fund which has been set up. There is to be a return to them of the 10 per cent. contributions paid in by the Corporation. But that is nothing to do with pension rights. Therefore, it seems to me that they are being cheated out of compensation rights which they were entitled to expect to be paid to them in some form of compensation. The fact that this money is to be paid either in cash or in some form of insurance which will give them a little money when they are 65 years old does not correspond to the pension rights which they were entitled to expect. They were sure that they were to have these rights, because they were told so when they applied for the jobs.
Reading this Act, they are entitled to say that they were to get proper compensation for loss of pension rights because the Corporation was to end. These people have a justifiable grievance. The Government can argue that they have only been working there for two years, and that they have a job with the Agency—44 of them. That job can last for a long time, or for a short time. Whether these people have, or have not, a reasonable job as a result of denationalisation has nothing to do with the matter. The fact is that by the Act passed by this House, and put forward by the Government, everyone was led to believe that these people would have a pension. I therefore ask the Government to look at this matter again.
I suggest that the Government are technically entitled not to give compensation if it does not want to; but in view of the wording of this Act, I say it is not 1106 playing fair with the House—and it has certainly caused considerable perturbation and annoyance among the staff concerned—to find that they are not to get compensation for these pension rights. I hope that the Minister will look at this matter again and perhaps bring in some amending legislation. The grievance, it is true, concerns fewer than 60, but this House has always been as jealous of the rights of small numbers as of large numbers. Because we are satisfied with the effect of these Regulations upon the great majority working in the industry is no reason why we should not ask the Government to look at the problem of the small number who feel, with justice I believe, that they have been unfairly treated.
§ 11.0 p.m.
§ Mr. P. B. Lucas (Brentford and Chiswick)
I only wish to raise one matter briefly. This relates to Part III of the Regulations, which deals with loss of employment, emoluments, and pension rights. I find myself in the somewhat remarkable situation of being in some degree in agreement with the right hon. Gentleman the Member for Vauxhall (Mr. G. R. Strauss). He quoted Section 24 of the Iron and Steel Act, 1953. I shall not weary the House with that again; but it appears to me that the Regulations we are considering have been so framed as to exclude from the provisions of Part III any reference to the officers or servants of the former Corporation.
I fully appreciate and welcome the assurances which my hon. Friend has given tonight, but on the face of these Regulations it would seem that in the event of the Treasury dissolving the Agency, as provided under Section 25 of the Act, these people could—I do not say they would—suffer any or all of the losses referred to in Section 24, without any guarantee of compensation.
This is a state of affairs which I had hoped might not arise, having due regard to the provisions of Section 24 (1, c) of the Act, but in spite of the assurances which have been given tonight my interpretation of these Regulations makes it questionable whether there are sufficient safeguards for those who were members of the staff of the former Iron and Steel Corporation. On the basis of their permanent employment with the Corporation, I was under the impression that they 1107 had acquired certain pension rights, but, so far as I can gather, under this proposal, should the Agency be dissolved in the future there is no certainty that comparable pension rights would, in fact, become operative.
I know that my hon. Friend has been most courteous, in meeting representatives of the Agency's staff association and hearing their views, and I am sure that they are grateful to him for the time that he has given to them. Nevertheless, they do retain the impression that, whereas, under these Regulations, the industry and the employees of the companies concerned have been adequately provided for, the treatment which they are receiving is less favourable. This may seem a small matter, but it is certainly causing them some concern. I hope, therefore, that when my right hon. Friend replies to this short debate he will elaborate a little more, and clarify a little further, the position of this small but deserving group of men.
§ 11.2 p.m.
§ Mr. Jack Jones
I want to intervene only very briefly in reference to what the Parliamentary Secretary has said. As the story of steel unfolds itself we really get the facts. Whereas we were told, ad nauseam, that there would be bureacracy going mad and "jobs for the boys" when this industry was nationalised, it now appears that it was successfully run by a staff with a maximum of 60 and a reasonable minimum of 44. That is a very interesting fact. [Interruption.] The hon. Member for Edinburgh, South (Sir W. Darling), like myself, wants to get to bed, if I properly assess the look of him.
There is the question of what I consider to be unfairness to these people who had a genuine right to expect compensation when this Corporation was set up. My right hon. Friend the Member for Vauxhall (Mr. G. R. Strauss) dealt with that. I want to refer to the individual who, it is suggested, might leave the employment of the Agency. There are some who might, and it is questionable whether they are getting a square deal. But what about the fellow who does not leave but gets the sack? What happens to him? Perhaps the Minister can tell us.
Within this Agency, there is bound to arise a clash of opinions. At the moment, I am looking at the Financial Secretary to 1108 the Treasury. I might, as a practical, technical fellow, be sitting on the Agency with him, and he and I might have a clash of opinion. He knows all about finance, and I know nothing about it, but I know how to make steel and what should be done with certain works. I want to know what happens to an individual who has a clash of opinion with Treasury officials and is given notice to leave. Will he get a job so easily, and get the amount of money which it is suggested might come to him? What about the man in the industry who, as a result of the technical inefficiency of the Agency, finds himself out of work?
I cast my mind back for a moment to Barrow Works, probably one of the least economic in the possession of the Agency, and will be for more than eight years if there is no slump. But if there is a slight recession in steel in this country and in the world, that is the sort of place that will find itself in debt very quickly. And what about the men who, in the employment of the Agency, have not been technically efficiently looked after through there not being technically efficient persons in charge?
I think we are at the stage in the steel industry where people own who cannot control and people control who do not own. Only part of the shares have been sold, and the remaining part has been left in the control of people who only own a part or percentage of the shares. What can the Minister tell us about individuals such as the man who loses his job as a result of recession, as a result of inefficiency, or as a result of being under the control of financiers rather than the steel makers?
§ 11.6 p.m.
§ Mr. G. R. Mitchison (Kettering)
I shall be very brief. What these people were promised in the subsection of the Act which was devoted specially to them and did not cover the company service was compensation for suffering loss of employment, or loss or diminution of emoluments or pension rates. Now there are two headings of compensation. One is resettlement compensation for loss of employment, which does apply to them, and which appears to be compensation rather like the widow's benefit under the National Insurance Act. It is small benefit. But when we come to the actual language in this subsection of the Act, which is repeated in these Regulations, 1109 the very words about loss or diminution of emoluments and pension rights, we then find that they are specifically omitted from it. When we turn to see what are the pension rates and look at the definition, we find it is exceedingly wide. It is not merely a formulated scheme. It means an arrangement "whether by virtue of any statute, trust, or customary practice, or otherwise in connection with his employment as a person or servant," and it then carries on as to the contracts of the employing companies. Now, if a man is invited by an advertisement, which offers, or suggests that he shall have pension rights, to undertake a job which at the time looks like being permanent, I should have thought that was getting precious near the kind of language that is used here.
I want to put it a little more broadly. These people, we are told, and it is not denied, came from outside. They came into a particular skilled kind of office work in a public corporation, and I imagine they felt they would get the kind of treatment that people who go into the Civil Service get. I am certain that was the sort of thing they had in mind, and it is borne out when we look at the terms of the pension arrangements, which, I hope the Minister will agree, are modelled on what is prevalent in the Civil Service. There is the same old formula about the number of years, and the rest of it, that dates back to some 19th Century Act in connection with the Civil Service.
These people seem to me to have been misled. They could assume that they were going into a public service in respect of which pensionable arrangements would be made for an employment of long, practically indefinite operation, and that they have abruptly, owing to this piece of legislation, been deprived of it. So much for the pension.
But there is another matter; they were also promised compensation for loss or diminution of emoluments. So far as I can see—I am sure I shall be corrected if I am wrong—that has been entirely omitted. They are entitled to this widow's benefit, as I call it, as resettlement compensation for a very short period, but suppose in fact, as a result of this change, they get another job, and get it at considerably lower emoluments, that is specifically the case that was to be covered by the Regulations made 1110 under this subsection. It is covered, of course, in the case of servants of the company, and it was also promised under this subsection to officers or servants of the Corporation. Why do they not get it? There may be argument about their strictlegal right to a pension. There cannot be very much about their moral right to it, I should have thought. When it comes to loss or diminution of emoluments, I do not know what the Minister's answer is. Why were they promised that in the Act, and why are they now not entitled to have that promise fulfilled?
§ 11.12 p.m.
§ Sir William Darling (Edinburgh, South)
I hope the Parliamentary Secretary will not yield to these blandishments. I confess I cannot hope to know very much about the subject, but it is perfectly apparent from the speech of the hon. and learned Member for Kettering (Mr. Mitchison) that no promise was given, that it was presumed that pensions would be paid, that it was imagined that pensions would be paid, that people thought they were joining a kind of Civil Service. These aparently were just attractions in an advertisement which invited these 60 persons who knew nothing about, the steel trade to come into the industry, and they are now trying to claim pensions.
§ Mr. G. R. Strauss
The hon. Gentleman said he knew nothing about the matter. In that, in this point, he was absolutely correct. He said they were not led to expect there was to be a pension scheme set up. I have the advertisement here to which they replied:Persons appointed may be required to join a contributory pensions scheme which the Corporation intend to set up in due course.
§ Sir W. Darling
"May be required." If the right hon. Gentleman will make much out of that he can talk to his hon. and learned Friend the Member for Kettering. There was not a promise of a pensions scheme, and the Parliamentary Secretary takes his stand apparently on that premise, and I want to support him. The present large appetite for pensions in this country seems to be becoming endemic. This will be soon an entirely pensionable community. The other day it was pensions for policemen, and a little while ago pensions for retired officers, and now there is this specious claim for no doubt deserving men and women who joined 1111 this industry, who knew it to be precarious.
They were men and women with practical knowledge who knew this proposition was being forced on the country by the Socialist Government, and was a policy which was resisted apparently by half the nation. In spite of those plain facts they came forward to join something as though it were as permanent as the Civil Service. If they had been wise in their generation then, no doubt, in the few months they were in office they would have seen that this pensions scheme was set up; they could have seen that the promise which apparently was inherent in their minds was brought into very rapid being. If it was not they should be indicting the right hon. Gentleman the Member for Vauxhall (Mr. G. R. Strauss), who had a good deal to do with it, for not having set it up. He did many things; why did he not do that? Those who are not getting the pensions now should not lay the blame on this Government but lay the blame on the previous Government who were so busy doing other things they neglected to attend to the circumstances borne in the minds of those who joined the party.
I hope the Parliamentary Secretary will remember the Government he represents. This is a Government who are hard pressed financially in many directions, and it is not for him to interpret in any generous terms these arrangements whereby public money is to be freely dissipated. I hope he will resist this specious plea by the right hon. Gentleman the Member for Vauxhall and stand by the rigid letter of the law. No more; no less; preferably less.
§ 11.16 p.m.
§ Mr. Anthony Marlowe (Hove)
I wish to take a contrary view to that expressed by my hon. Friend the Member for Edinburgh, South (Sir W. Darling). I feel a great deal of sympathy with the case made by the right hon. Gentleman the Member for Vauxhall (Mr. G. R. Strauss), but I was surprised at his naivety in that he found himself unable to understand the failure of the Treasury to keep a promise. He should know by this time that there is a well-established precedent for that, when we are dealing with matters of pensions. The right hon. Gentleman 1112 should be well aware that there are many cases in which the Treasury goes back on its promises with regard to pensions.
It may be considered irrelevant in this discussion to go into the matter of the pensions for certain officers in which I am interested in another connection, but the parallel is very much in point. As I understand his case, the right hon. Member for Vauxhall says that a particular inducement was held out to people to accept a particular post on the under standing that when the time came for a pension to be awarded to them that would be done—
§ Mr. Marlowe
It would be considered. My hon. Friend says that it was to be considered. I could cite a much stronger case where it was promised, where a contract was made on the basis that a particular pension would be paid at a particular time; and by some calculation which the Treasury was able to arrive at it was able to say, "We have now decided that the pension should be greatly lowered."
§ Mr. Deputy-Speaker (Sir Charles MacAndrew)
Order. The hon. and learned Gentleman is going far beyond the matter under discussion.
§ Mr. Marlowe
I do not wish to weary the House with another subject, but I am merely putting this forward as an illustration of the point made by the right hon. Gentleman opposite. I thoroughly understand the case he has made. He is saying that there is a casewhere there was a bargain made—
§ Mr. Marlowe
An anticipated bargain, and the bargain was not kept. I merely wish to point out to the right hon. Gentleman that he should not be surprised when these things happen. Apparently it is a well-established practice for the Treasury to enter into bargains of this kind and, when it suits them, to back out. I hope that the extension of this principle will not be carried any further.
I have not heard what this will cost, but I should like to know what the cost will be. We understand there are 60 people involved, and I should like to know if there is any cost falling on the Treasury. It may be that there is none, but I think 1113 we are entitled to know before leaving this matter, and whether any expenditure involved is equivalent to the £200,000 which the Government refused to the pensioned officers in whose case I am particularly interested.
§ 11.20 p.m.
§ The Minister of Supply (Mr. Duncan Sandys)
I can assure my hon. and learned Friend the Member for Hove (Mr. Marlowe) that there will be no payment from the Treasury. The money which has to be found by the Agency will come from its own revenues.
The right hon. Gentleman the Member for Vauxhall (Mr. G. R. Strauss) and other hon. Members concentrated their remarks on the compensation to be given in the event of loss of one kind or another suffered by members of the staff of the Corporation as a result of the processes of de-nationalisation. I wish to correct the impression that there has been any act of bad faith, or any failure on the part of the Government to carry out any assurances given during the debates on the Bill. The right hon. Gentleman gave the impression that we had promised in some way or another that Regulations would be introduced to give the kind of benefits he has been claiming this evening—that is to say a complete departure from the provisions of the eight year rule which was well established in previous compensation Regulations. I should like to draw his attention to the terms of the Act itself. Section 24 statesThe Minister shall, by regulation, require the payment by the Agency in such cases, and to such extent as may be specified in the regulations.Obviously, now that the matter has come before the House for the first time, it is for discussion whether the Regulations go far enough. However, nothing in the Act says that a particular type of compensation is to be granted. Under subsection 3 these Regulations apply to officers and servants of the Corporation.
The last thing in the world I would wish is that there should be any suggestion that we are treating anybody shabbily. I have taken the view that, if there is any doubt whatever, we must do a little more, if necessary, than is absolutely fair so that there can be no possible suggestion that any body has been unfairly treated because of this legislation.
1114 Under the original draft of the Bill as presented to the House, as the right hon. Gentleman may remember, there was no mention whatever of a compensation scheme for the staff of the Corporation. The reason was that all compensation schemes were based, apart from the short-term resettlement, or the widow's benefit as the hon. and learned Member for Kettering (Mr. Mitchison) described it, on the eight-year period of service. As the staff of the Corporation could not possibly qualify under the eight-year rule, we left them out in the original draft of the Bill. At a later stage, as a result of discussion in the House, they were brought in under a subsection of Section 24.
In doing so, I said:The second Amendment relates to compensation for officials and employees of the Iron and Steel Corporation. This was not referred to in the original draft because the period of their service has been too short to qualify them for compensation under any of the Regulations so far issued. The possibility of bringing employees of the Corporation within the scope of the compensation regulations which might in due course be issued should not be excluded in advance."—[OFFICIAL REPORT, 24th February, 1953; Vol. 511, c. 1950.]That is all I committed myself to doing, namely, bringing the staff of the Corporation within the terms of the compensation arrangements notwithstanding the fact that they would not in any normal conditions nor in accordance with previous precedents, qualify for compensation under the eight-year rule. That is the only commitment I made to the House. We did not wish to exclude by legislation the possibility that the staff of the Corporation might be included in the compensation schemes. That is what we have done. We have included them, but have not been able to give them compensation on a scale which would not be granted to anybody else in similar circumstances. That is the difficulty of the situation.
As my hon. Friend explained earlier, we have followed closely the terms of the Transport Denationalisation Regulations, which have been approved by the House. We should get into great difficulties if we introduced a different set of Regulations for compensation in different industries. The circumstances are in almost all respects absolutely identical. There is one difference, and that is that a certain number—I do not know how 1115 many, but I doubt whether it is by any means all—of the staff of the Road Haulage Executive had previously been employed in the road haulage industry. Therefore it was quite possible that by adding the period of service under the Executive to the period of service in some other capacity in the industry, they were able to make up the eight-year period, and therefore to qualify. That does not happen in the case of the Iron and Steel Corporation staff who, almost without exception, were not previously employed in the industry.
The question really is whether people who have served a body for different periods until the Corporation was dissolved, some two years and nine months at most—we are not talking about short-term resettlement compensation but about long-term compensation—are entitled, to the same extent as a person who has worked all his life, or for a great number of years, in an industry, to what is described as "long-term" compensation. That is the issue.
The fact is that we are, under these Regulations, providing compensation for the staff of the Corporation on exactly the same basis as for the Road Haulage Executive, subject to the fact that their service may be different, and as for the workpeople throughout the whole of the iron and steel industry. I would find very great difficulty, and so I think would hon. Members on all sides of the House, in providing compensation terms for the staff of the Corporation which were superior, better and more advantageous than the compensation which we are offering to the working men in the iron and steel industry. What is suggested here is that we should accept the period of two years and nine months as the qualifying period for long-term compensation. I would find it very difficult to refuse compensation to a steel worker who, owing to denationalisation, lost his job, while the administrative staff of the Corporation should qualify for it. We should get ourselves into great difficulties and I do not see how we could possibly justify it.
The right hon. Gentleman said that the staff had been led to expect some scheme when they joined the Corporation. That is true, but it was more, as the right hon. 1116 Gentleman read it out, a warning that there might be a contributory scheme. But, as my hon. Friend, the Parliamentary Secretary has already explained, this matter has by no means been neglected in the short time that the Agency has been in existence; it has now produced a scheme to meet just this kind of case. As has been explained, the members of the staff, under this scheme, will qualify for a cash payment at a stated date, or a deferred annuity; calculated in each case by reference to service and salary, and an important aspect of that is that in calculating service, service with the Corporation will be added to service under the Agency.
I only wish that this scheme had been made known to the members of the staff of the Agency at an earlier date; but we have had discussions over a number of months, and it was only in the last few days that the scheme has been made known. I say this because I think that the attitude of the staff of the Corporation might have been different if they had known of the scheme. I hope, and I have every confidence, that they will feel reassured by announcement of this scheme.
That, broadly, is the position and, in addition to this, we are providing a resettlement benefit—short-term compensation. I am assured that the Agency is as anxious as hon. Members in all parts of this House to see that cases of special hardship do not get overlooked. It is prepared to deal specially with cases where hardship arises; but I am hopeful that hardship, or loss, or injury, at any time will not occur. So far as other employment is concerned, I can tell hon. Members that, with the exception of one person, who has found employment elsewhere, all the members of the staff of the Corporation are now employed by the Iron and Steel Board, or the Agency, I have no doubt that it is most unlikely that there will be any cases of hardship arising from de-nationalisation any more than there were as a result of nationalisation.
That the Draft Iron and Steel (Compensation to Officers and Servants) (No. 2) Regulations, 1953 [copy presented, 20th November] be approved.