HC Deb 15 March 1965 vol 708 cc1002-11

Motion mode, and Question proposed, That a sum, not exceeding £35,840,000, be granted to Her Majesty, to defray the expense of non-effective services, including a grant in aid, which will come in course of payment during the year ending on the 31st day of March, 1966.

9.35 p.m.

Mr. Goodhart

Appendix I of the Army Estimates refers to two types of male officers who get less than the basic rate of pay. One is a dental second lieutenant. I must admit that I do not mind very much if he gets less than the basic rate of pay, because 20 years ago a dental second lieutenant did grievous damage to one of my teeth.

The other type is a full colonel quantity surveyor in the Royal Engineers, who, when he is drawing his full increments, gets 4s. less than the basic rate for an ordinary colonel drawing his full increments. I believe that this is the last time that this anomaly will appear in the Estimates. I understand that all colonel quantity surveyors in the Royal Engineers are to be discharged in the coming year; they will all be retired, and so there will be no colonel quantity surveyors left.

I understand that there are only nine of these officer quantity surveyors still in the Army, so that only nine persons are affected by this compulsory retirement. But they are rather worried about what they hear of the negotiations going on about their retirement terms. I have heard that they are to get considerably less in the way of terminal grants than were offered in the 1957 White Paper to those officers who wished to take a "golden bowler". Surely it is not right that eight years later officers who are coming to the premature end of their military service should be offered substantially less—perhaps £2,000 less. I can tell the Under-Secretary that, although only nine officers are involved, this matter is being watched with considerable care outside, because this is the first time that Ministers have had to stand up and negotiate with the Treasury on behalf of a group in the Armed Forecs who are becoming redundant, and it will not be the last time. Persons outside will be watching carefully to see that good terms, and terms not less than those obtained in 1957, are obtained by the present Government.

I turn to the smallest item in the Vote, which is Vote D, for Polish ex-Service men. Last year the Estimate was raised from £50,000 to £75,000. Ministers of the last Administration were attacked for their parsimony, and it was said by members of the Opposition that at long last justice ought to be done by this small group of Polish ex-Service men who had contributed much to the defence of this country in its hour of need. The case was very eloquently put from the Opposition benches in those days.

Now we find that the £75,000 in last year's Estimate has been cut by £10,000 to £65,000 by the very people who pressed for much more generous treatment. This is not the only instance in which there has been a reduction in real terms by those who in the past have called for greatly increased payments. Looking at the whole Vote one finds that in real terms there has been a reduction compared with the amount of money paid out last year. The actual increase in the Vote is 1.935 per cent. compared with last year, which represents a substantial loss in real terms.

From this Box throughout last year, the Opposition, as the party opposite then were, pressed for vast increases in this Vote. I should like to quote from a speech made by the hon. and learned Member for Northampton (Mr. Paget) on 14th December. He told the Committee: I then had the task, the very pleasant task, of being the spokesman for the Labour Party at the Dispatch Box on the last two Army Estimates and of making this pledge in most specific terms, which was that we would take the first opportunity to raise the pensions of the retired Service people to what they would have been had the man retired upon the latest pay scale"— in other words, parity.

The hon. and learned Member went on to say: I was authorised to give that pledge"—

The Chairman

Order. Is the hon. Gentleman quoting from the debates of this Session? It is not in order to give the quotation unless it is from another stage of these debates.

Mr. Goodhart

One could say that it was, Dr. King. At least, the hon. and learned Member went on to point out that he had discussed that pledge with the former Leader of the Opposition, Mr. Hugh Gaitskell, and with the then Opposition spokesman on defence. Mr. Gordon Walker, and that this had been specifically approved by the present Secretary of State for Defence, who was sitting beside him at the time he was making that pledge.

As the hon. and learned Member said: We do not discard an undertaking of that sort merely by discarding the spokesman."—[OFFICIAL REPORT, 14th December, 1964; Vol. 704, c. 76.] When this pledge has been brought to the attention of Ministers opposite, they have answered by saying that a review was taking place. No doubt the Chief Secretary, whom I see in his place, is one of those who is taking part in the review, which, we heard this afternoon, is being conducted by the Chancellor of the Duchy of Lancaster. What are the terms of that review? Do the Government accept that the words used by the hon. and learned Member for Northampton constitute a pledge and commit them? If so, is this commitment to be found in the terms of reference of the inquiry? We should like an answer to that this evening.

9.45 p.m.

Mr. Scott-Hopkins

I wish to ask three short questions. First of all, about the Royal Hospital, Chelsea. We see that there are vacancies there, and I hope that the hon. Gentleman will consider with the hospital authorities making maximum efforts to ensure that the vacancies are filled at the earliest opportunity, because I am certain we all want to see the complement kept to the full at the Royal Hospital, Chelsea.

Secondly, is he aware of the difficulties we have had in the past over a complication in the pensions of officers, in that, when an officer wants to commute part of his pension he has to submit the ground on which this should be done? In the past, as at the moment, the decision on the submission is taken by the hon. Gentleman and his right hon. Friend on the advice of their advisers in the Department. The point at issue here is the fact that a lot of people feel that the Department is judging matters which it is not qualified to judge. The Department may say that the grounds put forward in the proposals are not a good business proposition or, at any rate, are not good business.

Would the hon. Gentleman look at this point to see if it is possible to set up an independent panel of advisers to advise himself and his right hon. Friend? I am certain that this difficulty arises not only in the Army but in the Royal Air Force and the Royal Navy as well. I think that, if the hon. Gentleman did this, he would find that retired officers, when putting forward applications to his Department, would feel that their applications would be properly dealt with by people able to understand and assess the business possibilities of the officers' proposals, and the reasons for their wanting to commute part of their pensions.

My last question arises on appropriations in aid and pension contributions for Commonwealth and other Governments. Can the hon. Gentleman give an assurance to the Committee that where and when changes take place in pensions because of circumstances in this country, such as the cost of living going up here, or because there is depreciation of money, he will make the strongest possible representations to overseas Governments to see that officers receiving contributions from those overseas Governments get comparable increases in their pensions from those overseas Governments?

9.47 p.m.

Mr. Allason

I wish to reinforce what my hon. Friend the Member for Cornwall, North (Mr. Scott-Hopkins) has said about commuting pensions. As I understand it, the vast majority of officers are entitled to commute up to 50 per cent. of their pensions without inquiries being made, but when it comes to other ranks there is very close inquiry as to how the money is to be spent. I think there is an undue amount of paternalism taking place here. It seems to be a pity that there should be difference of treatment between officers and other ranks to this degree in this matter. Therefore. I sincerely hope that the Under-Secretary of State will be able to assure us on this and tell us that a new procedure will be adopted in the future on commuting.

Mr. Eric S. Heffer (Liverpool, Walton)

I should like to ask my hon. Friend a question or two about the Royal Hospital, Chelsea, and about the in pensioners. How much is the basic pay, and how does one arrive at the various rates according to circumstances? How often are these rates reviewed, when do increases take place and in what circumstances are they made?

9.49 p.m.

Mr. Reynolds

It is perfectly clear, as the hon. Member for Beckenham (Mr. Goodhart) says, that nine officers who are quantity surveyors are involved. The transfer of this type of work from the Army Works organisation to the Ministry of Public Building and Works took place under the previous Administration. That has, in fact, left those officers with us, although the work is being carried out by another Department.

The hon. Gentleman is correct when he says that discussions are going on about the exact compensation terms to be offered in these cases. The present circumstances are rather different from the "golden bowler" scheme of 7 to 8 years ago. Then there were a large number of officers who were being induced to leave the Army because of the rundown of the Army. There was the problem of them all coming on to the labour market at the same time and of trying to get jobs. In this case, however, we have nine officers, and even if they all came on to the labour market on the same day they would not have an appreciable effect on it. As I say, we are still negotiating terms, and I will let the hon. Gentleman know the position in clue course.

Mr. Goodhart

They are going on to a small labour market. They are all qualified quantity surveyors, and nine quantity surveyors thrown on to the quantity surveyor's market may swamp it.

Mr. Reynolds

I do not think that I can accept that. Once the negotiations have been completed. I shall write to the hon. Gentleman and let him know the terms.

The hon. Member for Cornwall, North (Mr. Scott-Hopkins) asked about the pensioners at the Chelsea Hospital. He asked that we should fill the vacancies which exist. To the best of my knowleds there are no vacancies at the moment. If the hon. Gentleman reads Appendix X he will see that the Royal Warrant provides for 588 people to be accommodated there. The hon. Gentleman says that there are fewer than that number there at the moment. The Estimate is based on the average number expected to be there.

Mr. Scott-Hopkins

I have visited the Chelsea Hospital about three times in the last year. The hon. Gentleman will find that there are vacancies there, and all that I was asking him to do was to use his good offices to see that they were filled.

Mr. Reynolds

There is a waiting list for the hospital and the governors meet every six weeks to consider the position. I understand that it was an historic occasion last week when two Ministers, the Paymaster-General, who is the Chairman, and myself, were there. We have to be careful not to confuse what the Royal Warrant says with the number of vacancies which actually exist for people to move into.

The hon. Member for Beckenham referred to the position of officers and other ranks who retired several years ago, and the need to review the pension scales which they now enjoy. There is nothing that I can add to what was said by my right hon. Friend the Secretary of State for Defence in reply to questions during the defence debate, again during discussions on the Army and Air Force votes, and what was said this afternoon by my hon. Friend the Under-Secretary of State for Defence for the Navy.

A review is being carried out by the Government, and when we have come to a conclusion about what can be done an announcement will be made to the House. I cannot go any further than that. The hon. Gentleman will have to contain his impatience. We have been looking at this for only a few months. The problem has existed for the last thirteen years.

Sir Arthur Vere Harvey (Macclesfield)

The problem has existed for many years, but a certain amount has been done. Two years ago something was done to help widows, but not enough. Will the hon. Gentleman bear in mind that his party's letter to the Officer Pensioners' Association gave a specific undertaking about what would be done? I think that the country is entitled to hear what is being done, and when.

Mr. Reynolds

The House, the country, officers and other ranks will know the result of the review which the Government are carrying out when the review has been properly carried out in detail. When that has been done, there will be a report to the House, to the officers, to the other ranks and to the country as a whole. We have been in office for four and a half months, and the review is under way. It is being carried out, and the result will be announced as soon as possible.

Mr. Goodhart

May we take it that what was said by the hon. and learned Member for Northampton (Mr. Paget) did not constitute a commitment by the Government?

Mr. Reynolds

A review is being undertaken to see what can be done. It is not a question of saying that a colonel who retired 25 years ago should get the same pension as a colonel who retired last week. Over the period terms of service and length of service before getting a pension have altered, and all these points have to be considered. Once the review has been completed my right hon. Friend the Secretary of State will make an announcement to the House. There is a great deal of difference between considering the principle and looking at the minutiae of detail involved in doing anything. All this is being done now.

Sir A. V. Harvey

When the hon. Member's party wrote to the Pensioners' Association they surely must have studied the problem beforehand?

Mr. Reynolds

The problem has been studied by many hon. Members on both sides, and by all the parties, for many years. Now it is actually being looked at by the Government. That is the improvement that has taken place since 15th October. We want to see what can be done in this case.

I was also asked to look at the position with regard to commutation. It must be realised that the majority of people who retire from the Services are in receipt of a pension, and because they have earned a pension they have also earned a considerable lump sum, which is paid to them on retirement. As for other ranks, if a small amount of money is required by way of commutation to assist, say, in the purchase of a house, it is usually granted automatically, but if anything further is required, justification is asked for.

In my view the present system operates well. I am satisfied with the advice that I have been given, and I do not accept that specialist advice should be brought in.

Mr. Scott-Hopkins

Several cases have come to my knowledge affecting both officers and other ranks in my constituency who have put forward business propositions which the Minister's hon. Friend has turned down. I have merely asked the Minister to see whether it is possible to bring in an adviser so that these people are not only fairly treated but are seen to be fairly treated, and so that their business propositions are properly assessed by people who are fit to judge. Much as I like the hon. Member, I do not give a fig for his judgment.

Mr. Reynolds

The hon. Member has been doing a lot of work on the Estimates this evening—reading them just before he has made his speeches. I do not deal with these matters myself, nor does my right hon. Friend. Advice is available to us in the Department. Whether or not the hon. Member cares a fig for the advice that is available in the Department, my right hon. Friend and I are satisfied with the way in which the system is operating at present.

Pensions are awarded for services rendered, and are intended to enable the individuals concerned to be assured of a certain level of income which they have earned during their service. Every time a commutation takes place that income is diminished, and it can result—if a business venture goes wrong—in the individual concerned becoming a charge on public funds. That possibility has to be guarded against, and the interest of the individual also has to be protected. As I said, I am satisfied with the present system. I understand that no provision is being made for any commutation in respect of the pensions of Members of Parliament.

As for overseas pensions, I will bear the point in mind. Where provision is possible we will do all in our power, but it will not apply in every case.

Mr. Goodhart

The hon. Member has done well in trying to answer a great many questions, but he has not touched on the point of Polish ex-Service men. May we have some explanation why the £75,000 has fallen to £65,000?

Mr. Reynolds

I am afraid that Polish ex-Service men are a diminishing number.

Question put and agreed to.

Resolved, That a sum, not exceeding £35,840,000, be granted to Her Majesty, to defray the expense of non-effective services, including a grant in aid, which will come in course of payment during the year ending on the 31st day of March, 1966.

To report Progress and ask leave to sit again.—[Mr. Gourlay.]

Report of Resolutions to be received Tomorrow.

Committee also report Progress; to sit again Tomorrow.