HC Deb 24 April 1967 vol 745 cc1085-8
Mrs. Thatcher

I beg to move Amendment No. 1, in page 6, line 27, at the end to insert: 'not excluding pensions or other benefits which, under any agreement for the time being in force between Her Majesty's Government in the United Kingdom and some other government, are payable by that other government'. The purpose of this Amendment will be clear to the Financial Secretary to the Treasury from the discussions we had in Committee. It is to clarify a point which was raised then. As the Financial Secretary will be aware, most people who served the Palestine Administration have been receiving a pension either from our own Government or from the Israeli Government. But there appears to be a small group of people who at present are not actually getting any pension although a pension is being paid into a blocked account. They are those employees of the Palestine Administration who were resident in Palestine until comparatively recently. They therefore fall under provisions of the 1950 Agreement we had with the Government of Israel, and the Israeli Government agreed to pay the pensions of these former employees who were then resident in Palestine.

The group to whom I refer have since left Israel and are not at present receiving pensions either from our Government or from the Israeli Government, although the moneys are being paid into an account in Israel. I am concerned that Clause 5 should give our Government discretionary powers to make pay- ments until such time as the position sorted out with the Israeli Government. I am sure that the Israeli Government will be most helpful and co-operative. I have always found them so in any previous discussions or questions which have been raised with them.

It looks as if there may be powers in Clause 5(1,b), but that provision refers to "ex gratia payments" in respect of the former Palestine employees. I am not sure whether a pension, which is a continuing periodic payment, could be adjudged an ex gratia payment within paragraph (b), nor am I sure whether it would be enough to make payment of such pension on condition that the sums were recovered from the blocked account when the moneys in that account were released.

My main concern is that those who served the Palestine Administration and who are entitled to pensions now should get them. They should have some visible means of support, whether they live here, in Australia, or anywhere else. I shall be quite happy if the Financial Secretary tells me that he has power to make payment of these pensions pending the sorting out of arrangements with Israel.

The Financial Secretary to the Treasury (Mr. Niall MacDermot)

I think that the hon. Lady the Member for Finchley (Mrs. Thatcher) has in mind in particular the case of one pensioner who is at present resident in Australia and who, I think, has taken out Australian citizenship. Although there may be a few other people in a similar position, it may be helpful if we discuss this problem in relation to the facts of the case.

The person in question was a local employee of the former Palestine Administration who continued to reside in Israel when that Administration came to an end. Under the Anglo-Israel Agreement of 1950, the Israel Government accepted responsibility for the payment of pensions to former Palestine Government officers who were then resident in Israel. This was one of a number of considerations which were taken into account in the financial settlement which was embodied in that Agreement.

The pension was paid by the Israel Government in accordance with the provisions of the Agreement and no difficulty arose until the pensioner left Israel in 1963 to go and live in Australia. The difficulties arose because of the tight exchange control restrictions operated by the Israel Government. They have not suspended his pension. It is still being paid, but it is being paid into a blocked account in Israel. Therefore, to that extent it cannot be said that the Israel Government are in default of their obligation under the 1950 Agreement.

Obviously, this is a very unsatisfactory position from the point of view of the pensioner, who took the matter up with the Conservative Government, who told him what the legal position was, as I have just outlined it, but they agreed to take up his case and to make representations on his behalf to the Israel authorities. Those representations were not successful at the time, but they have been continuing and the present Government have continued to urge upon the Israel Government that it would be right to release these pensions to the blocked accounts.

We understand that there is some indication that the Israel Government may be prepared to relax their attitude towards the payment of pensions outside Israel. Her Majesty's Government will continue to do whatever they can to move the Israel Government to make the necessary foreign exchange available, but we cannot agree that it would be right for us to seek to meet this situation by paying the pension ourselves; for to do so would merely be to invite the Israel Government to withdraw from a responsibility which they have never sought to repudiate. I hope that these representations will be successful before too long.

11.15 a.m.

I will now seek to answer directly the legal question which the hon. Lady put to me as to whether we would be able, if we were so minded, to make any ex gratia payment by way of advance—I think she suggested until the blocked accounts were released. The advice I have is that there would be power under subsection (1,b), which is sufficiently widely worded, to enable payments of that kind to be made ex gratia, because, for the reasons I have explained, there is no legal obligation on Her Majesty's Government to pay them.

It is only right that I should reiterate that it would not be our intention to use the power under subsection (1,b) for this purpose. We hope, instead, that we shall find a satisfactory solution to this problem as a result of the action which has been taken through diplomatic representations.

Mrs. Thatcher

If the Financial Secretary has the power, perhaps I can harry him on another occasion as to the way in which he uses that power. If he is satisfied that an advance would fall under the phraseology "ex gratia payments", which it clearly does not, I am happy that he has the power. I should have thought that an advance is not an ex gratia payment by any reasoning. However, I accept the hon. and learned Gentleman's assurance. As extra statutory payments have been made before, and perhaps could be made again, I beg to ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Bill read the Third time and passed.