HC Deb 17 July 1953 vol 517 cc2454-60
Mr. H. Wilson

I beg to move, in page 5, line 2, at the end, to insert: 3. Notwithstanding anything contained in the foregoing provisions of this Schedule the annual amount to be recommended by the Board of Trade under sub-paragraph (1) of paragraph 1 of this Schedule in the case of a person appointed as chairman or deputy-chairman of the Commission and having been within the month immediately preceding that appointment a civil servant, shall be the sum of—

  1. (a) such annual amount as he would have received under the Superannuation Acts, 1834 to 1935, and the Superannuation Act, 1949, if he had completed his service as a civil servant on the date of his said appointment; and
  2. (b) such fraction of his last annual salary in relevant service as he would have received under sub-paragraph (2) of paragraph I of this Schedule by reason only of his service as chairman or deputy chairman of the Commission.

The Deputy-Chairman

It would be convenient if, with this Amendment, we discuss the following one, in page 5. line 14.

Mr. H. Wilson

I think that will be a convenient arrangement, and I need not detain the Committee long in saying why we have put down these Amendments. The pension provisions of the Bill are provisions which, on the whole, we support, because it will help the right hon. Gentleman and any successor of his to find the best possible men for the position of chairman or deputy-chairmen, but it does seem to us that, in the pension provisions as drafted, there is a danger of certain anomalies arising as between certain servants of the Crown.

Let us suppose, for example, that a senior civil servant was appointed to the position of chairman or deputy-chairman of the Commission, and that he has served 15 years in the Civil Service before he becomes chairman or deputy-chairman. As I understand, under the Bill as now drafted the period that he spent in the service of the Crown as a civil servant can be counted as approved service—" relevant service "is the phrase used by the Treasury—to be added to the number of years which he serves as chairman or deputy-chairman of the Commission, and that the total number of years of his service with the Crown, whether as chairman or deputy-chairman of the Commission or in his Civil Service capacity, is then ranked for determining the number of fortieths of his concluding salary which would be his pension.

I am not sure that that is not a little over-generous, because, surely, what he is entitled to is the Civil Service pension in respect of the 15 or more years in which he served in the Civil Service and a special pension in respect of those years—and only those years—which he spent as chairman or deputy-chairman of the Commission. The President of the Board of Trade will probably see why we moved this Amendment. For instance, there might be some ill-feeling created within the Civil Service in respect of such appointments from within the Civil Service.

It is a matter of some importance if a particular civil servant is singled out from his fellows to act as chairman or deputy-chairman of the Commission, because it means that he receives a higher salary than those of his colleagues who stay in the Service, or, if he is not appointed until after his retiring age, then. of course, he gets a higher salary as-chairman or deputy-chairman and certainly a better pension than that to which his perhaps less fortunate colleagues are entitled.

To add to that discrimination, which I would be prepared to defend, the provision that the civil servant in question would be entitled to count the whole of his Crown service to qualify him for a proportion of the retiring chairman's pension, which is by definition better than the corresponding pension in the Civil Service, would give him an excessive advantage over his colleagues who remain in the Civil Service.

I can understand why the right hon. Gentleman asked us to agree to the proposition that, in addition to any period spent as chairman or deputy-chairman of the Monopolies Commission, he should be allowed to add other Crown service, because I think it is a fair proposition as far as it goes. For instance, let us suppose that the chairman of the White Fish Authority, on ceasing to be employed in that capacity, becomes chairman of the Monopolies Commission. I am not saying that that post would be very good training for the job, but other public appointments might be held. It seems right that, since he has embarked on a career of service to the Crown, he should be able to count both periods for the purposes of calculating his pension, and it would enable the President to have a little more freedom of choice in selecting the right person.

But, where the employment previous to becoming chairman or deputy-chairman of the Monopolies Commission has been in pensionable Crown employment, in the Civil Service or anywhere else, I think it is wrong for a man to receive a higher pension in respect of those years of service merely by the fact that, under this Bill, the Treasury is empowered to regard those years of pensionable employment as approved years of service.

In this Amendment we seek to separate the period of Civil Service employment from the period of employment as chairman of the Monopolies Commission. I do not think that any injustice is involved. On the other hand, I think that a certain element of injustice would be done to those remaining in the Civil Service if one of their number was picked out for the job, or if, on retirement from the Civil Service, he was appointed to the office of chairman or deputy-chairman of the Commission.

Mr. Mitchison

It is always rather difficult to deal with pensions within a comparatively narrow range, but I venture to suggest that this Amendment is right, not only for the reasons given by my right hon. Friend, but also for another reason. Relevant service has to be service under the Crown. There are at present on the Monopolies Commission two former servants of the Crown and a number of people who have been engaged in professional or industrial life in circumstances which normally would not have entitled them to a pension.

At the end of their period of service they will get a comparatively small pension based only on the period during which they have served as chairman or deputy-chairman because there will have been no other relevant service, and cannot have been because they were not in the service of the Crown, whereas the former civil servants will have had a long term of years which may be counted as relevant service before that, and will therefore get not only a higher pension, but a much sharply higher pension.

Some of these service terms rather remind me of the kind of War Savings Certificate that does not bring in any interest at the beginning and then goes up pretty steeply later on. That, of course, is the effect of a table of this sort which begins at ten-fortieths and goes up in 15 years to twenty-fortieths. The result is that if one can add to the beginning of one's service, one gets a rather disproportionate mathematical advantage over the people who cannot so add to the beginning of their service.

I do not think it is quite fair in that case to operate it in that way. To separate the two things and to give the former civil servant his full Civil Service pension up to the date of his appointment and then to add to it exactly what the other man would get for his service as chairman or deputy-chairman is certainly complete justice as between those two people.

The other sort of case I have in mind is this. Civil servants in this country are certainly not overpaid, and we may get a sharp rise between the last salary which a man receives as a civil servant and what he gets as chairman or deputy-chairman of this Commission. He gets a very considerable advantage in that case over his own Civil Service colleagues.

I feel that the reasonable justice of the matter demands that we should put former civil servants as nearly as we can in the same position as other people who have been engaged in a profession or industry, and who then take on this job. As I understand the arrangements in this Schedule, they are that the Board of Trade are bound to recommend either these amounts or others. That is the technical position. The Clause is imperative, and that, of course, is common form in these pension arrangements. It is also common form to have Treasury designation.

2.45 p.m.

Perhaps I misled the hon. and learned Member for Middlesbrough, West (Mr. Simon). Though there is not a strict entitlement, in practice, that is what they are going to get. In any case, where a man had qualified by length of service, the Board of Trade would make no recommendation unless there was some very grave or serious reason for doing so, and that is not the sort of thing we are considering. If they make the recommendation at all, then they are bound to recommend these amounts. Therefore, it is of importance to see that the amounts are correct.

Pensions are always singularly difficult things about which to draft Clauses, if only because of the extraordinary complication of the legislation about them. I think that this is quite a good Amendment. As I have been the person who has criticised the right hon. Gentleman most, I hope I may take the opportunity of saying that really the criticisms have been quite small and that some have been by way of teasing the President, a Friday afternoon operation to which I am sure he does not seriously object.

Mr. P. Thorneycroft

I agree with the hon. and learned Gentleman that these pension provisions are never simple. There is a real point in this which has to be met. The Bill, as it stands at present, provides that the Board of Trade may recommend an annual pension to be paid after not less than five years' service and provided that the chairman has passed the age of 65. That annual sum is based on the proportion of relevant service. The relevant service is defined as the pensionable service under the Crown, that is to say, whether or not it was completed and led to a pension, plus the pensionable service under the Commission.

Thus, a man who had five years' service as a civil servant and six years with the Commission would count for 11 years service altogether. That is all right as far as it goes, but, unfortunately, the Bill as drafted appears to allow him to keep his Civil Service pension in addition to adding the sum total of pensionable service in the Civil Service to that which he receives in the course of his service with the Commission, which was certainly not the intention we had in mind.

On the other hand. I think that the Amendment goes rather too far in the other direction. To give an example. Under the Amendment a civil servant who had nine and a half years of pensionable service in the Civil Service or under the Crown, and who then left the Commission on medical grounds after four and a half years service, would receive no pension at all. I do not think that was really the intention of the mover of the Amendment.

I am not going to stand pat on the technical difficulties of drafting Amendments to deal with a situation of this kind, but I will give an undertaking that we will have a look at the matter to see whether an Amendment can be drafted to ensure that there is no duplication in these cases. It may be that in order to do so, it would be necessary to ensure that earlier service should only count for pension in accordance with regulations made by the Treasury, which is a method that has been adopted in previous legislation for dealing with problems of this kind. I think it was dealt with under the National Insurance Act, 1946. Perhaps hon. Members will accept my undertaking that we will have a look at this matter to see whether we can deal with it in that way, or some similar way, and if so, I will try to see that an Amendment is introduced in another place.

Mr. H. Wilson

I would thank the right hon. Gentleman for taking the point that we have embodied in this Amendment so quickly and clearly, and for the undertaking which he has given. It certainly was not our intention that the Amendment should have the effect that he described. We should not want to deprive anybody of a pension to which he was entitled, but, at the same time, we are anxious, both on the ground of saving money and of preventing injustice and inequity, to prevent the situation which I described in my remarks two minutes ago. I therefore beg to ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn

Schedule agreed to.