§ Order for Second Reading read.
§ 11.4 a.m.
§ Mr. Robert Carr (Mitcham)
I beg to move, That the Bill be now read a Second time.
In about three weeks' time, I shall have the honour of having been a Member of the House for 17 years and this is the first time that I have had this good fortune in the Ballot for Private Members' Bills. Having over those years given up hope of being so fortunate, when I suddenly found myself in this position I had to give much thought to the subject on which I would seek to legislate.
In selecting a subject, I was seeking something which was not too big or complicated to be handled adequately and independently by a private Member and yet which was important and worth while. I was seeking something which was not controversial in terms of party political dogma and something, therefore, which was not a propaganda exercise but had a real chance of leading to a practical result. I was also seeking a subject which I felt would help individual people in a personal and practical way.
When I took these considerations into account, it seemed that the subject of this Bill, namely the rights and claims of public service and Armed Forces pensioners met all the demands which I have mentioned.
When I look back over my 17 years in the House or over the whole post-war period, I see that, in spite of all difficulties, they have been good years for those of us of active working age. We in our generation get opportunities for 908 work and leisure, for material prosperity, on a level which enables us, without too much immediate sacrifice, to make more provision for the future than any of our predecessors. We have had very different experience and prospects from any previous generation and this good fortune places on our generation a particular responsibility to take thought and practical action for those older than ourselves.
The Bill does not, of course, deal with all pensioners. It could not possibly do that, but is limited to those retired from the public service and the Armed Forces, in other words, to those for whom the Government and all in the House have a special degree of responsibility. Like all other hon. Members, I have, over the years in my constituency, met a considerable number of cases of public service and Armed Forces pensioners which has increasingly brought home to me the conviction that our present methods of handling these matters are not right and ought to be changed.
Also, in the last two years of the Conservative Government, my experience as Secretary for Technical Co-operation, in which capacity I had to deal with the cases of overseas service pensioners, strengthened this conviction. Those are the reasons which led me to bring the Bill before the House.
Before I come to its substance, I should like to render my sincere thanks to all those hon. Members who have sponsored the Bill with me and have helped me to prepare it and bring it before the House. I would also thank those many people outside the House who have given me advice and support. I am sure that my other supporters would not begrudge it if I said a special word of thanks to my hon. Friend the Member for Woking (Mr. Onslow) who has done a great deal of the work in assisting me to bring the Bill before the House and who, if the Bill reaches the Statute Book, will deserve more credit than anyone else.
I hope that the terms of my Bill are not only reasonably short but also simple and clear to understand. With the aid of the servants of the House, we have made a great effort to see that that is so. That being the case, I will not take up the' time of the House by going through the Measure Clause by 909 Clause. If, as I hope, my hon. Friend the Member for Woking is successful in catching your eye, Mr. Speaker, towards the end of the debate, he will try to clear up any queries which hon. Members may wish to raise about the drafting of any of the Bill's provisions.
Equally—and again to keep my remarks reasonably short—I will not give illustrations of detailed cases or categories within the public services and Armed Forces pensions sphere. I am sure that some of my hon. Friends—and, I hope hon. Members opposite—will be giving ample illustrations to bring these points home to the House. Meanwhile, I ask hon. Members, if they have not already done so, to look at the Answers which my hon. Friend the Member for Woking and I have received in the last week from the Financial Secretary to the Treasury and the Secretary of State for Defence. They appear as Written Answers in the OFFICIAL REPORT of 26th and 30th January and they clearly illustrate the anomalies and other aspects of the problems with which we must deal.
I wish to concentrate on the main purposes which the Bill seeks to achieve. I should, perhaps, make it clear, not of course for the understanding of hon. Members but principally for those outside who have been taking an interest in the Measure, that as a private hon. Member I cannot attempt to legislate to increase pensions or, for example, to reduce the age at which pension increases should be payable. That would be out of order for a private hon. Member to attempt. But, within that limit, I have sought in the Bill to meet what I regard as the two main needs of public service and Armed Forces pensioners.
The first need is for a regular review of these pensions. Action to restore the purchasing power of pensions, which have been eroded by inflation over the years, has been taken by successive Governments in a series of Pensions (Increase) Acts for the benefit of retired members of the civilian public services and by simultaneous Royal Warrants for those retired from the Armed Forces. That action has been taken on seven occasions since the war.
Whatever may be said about the adequacy of the increases awarded on each of those occasions, that is not the 910 point I wish to argue today. I wish to emphasise that these Pensions (Increase) Acts and Royal Warrants have been introduced at irregular and arbitrary intervals; and they must have been regarded as arbitrary intervals to anybody outside the Treasury.
This great body of pensioners has never had the satisfaction of knowing for certain when or whether their case was being considered, let alone acted upon. As things are at the moment, pensioners believe—I suggest with justice—that they will get their case considered only by prolonged and intense political pressure and, perhaps, by playing on the party political and electoral pressures which impinge on Governments. Even if that were right—and I certainly do not believe it to be right—pensioners are not equipped to do that job properly. In support of this claim, I quote in aid what the Financial Secretary to the Treasury said on Second Reading of the last Pensions (Increase) Act, in 1965. The hon. and learned Gentleman said:… we are concerned with people who have no powerful union to represent them and no powerful body to negotiate on their behalf. There are, of course valuable associations which speak for pensioners or for sections of pensioners, but they are not in any true sense negotiating bodies and cannot he negotiating bodies.—[OFFICIAL REPORT, 18th November,1965 Vol. 720, c. 1448.]Without further argument from me, I hope the House will agree that the present system is wrong and that it should be replaced by a known and open method of regular review, which I suggest should be at intervals of not more than two years. If hon. Members should be in doubt about that proposition, we should remind ourselves that we have now accepted that the pay and conditions of serving members of the Armed Forces are reviewed regularly and openly. If pay, why not pensions? Having accepted this need, as many of us have, we now have an obligation to do something about it.
I come to the second need which the Bill seeks to meet; the need to correct some of the anomalies which exist between one category of pensioners and another and between one individual pensioner and another. Hitherto, the main Pensions (Increase) Acts and Royal Warrants have in the main—although not entirely—been designed to make 911 across-the-board increases. They have done relatively little to remove some of the glaring anomalies, which depend on the chance of date of retirement, the particular service in which a pensioner had been employed, and many other factors.
The simple way to get rid of these anomalies would be the introduction of the principle of parity. No inquiry or reporting would, I suppose, then be necessary, because the process of adjustment would become automatic. But for many years to come anybody who is a financial realist must recognise that even if complete parity could be unanimously accepted as being right in principle, it could be brought into practice only gradually. Thus, to say that parity is the complete answer and that, therefore, it should be the only answer, would not serve to help pensioners who are in need at the moment.
We should, therefore, approach the matter by saying that, short of parity, some of the anomalies can and should be removed. If we are to do the job, it requires careful investigation and consideration to identify and define the anomalies and to fix proper priorities for dealing with them. That, I submit, should be done in a way which pensioners can understand and in which they can have confidence. That is the second need which the Bill seeks to meet. These are the two purposes of the Bill. I am convinced that they cannot be achieved satisfactorily within the Government machine by the existing methods.
So I come to the machinery proposed in the Bill to meet the two needs. This is essentially a machinery Bill. It proposes the establishment of an independent Commission with its own small secretariat. It also proposes that the Commission should have two functions, the first a duty and the second a right. The duty would be to conduct regular reviews of pension levels generally and to report, with recommendations, to the Chancellor of the Exchequer, for the first time not later than January, 1969, and thereafter at intervals of not more than two years. The Bill seeks to require that such reports should be laid by the Chancellor before Parliament. That is the duty. The second function—the right—is that, after consultation with the Trea- 912 sury, the Commission should be enabled to make investigations into particular aspects of existing pension entitlements.
The Commission would have power only to recommend. Only the Government of the day can have the power and the responsibility to decide and act. Governments always have difficult and uneviable tasks in deciding between competing claims and allocating the resources, which are always insufficient to meet all the claims in front of them at any given moment. But I hope that the House will agree that if there is to be a sense of justice among all those with these competing claims the Government should not be judges and advocates in their own cause. The competing claims between which any Government have to decide should be able to be put fairly, squarely and independently on behalf of the claimants, and that simply is not the case under the present system as far as public service and Armed Forces pensioners are concerned.
I submit that staff associations and similar bodies, with all respect to their good work—I mean that; it is not just a form of words—cannot be said to do this job adequately, because the first and proper duty of staff associations is towards their existing members actually working in the service at a given time, and in any conflict of interests in calling on resources from a limited pool, they must put their existing members in front of their retired members. They would not be doing their duty if they did otherwise. Similarly, the Government, acting in their capacity as employers, must, I submit—or certainly will be thought by pensioners to do so—put their existing employees first when the crunch of conflict comes. There is, I submit, a need for an independent assessment and presentation of the pensioners' claim, and that is what the Bill seeks to provide.
But let me stress in reverse—because I. know that some people concerned with joint consultation and Whitley machinery and so on have fears about this—that the Commission, which would be charged under this Bill with presenting reports and recommendations on behalf of existing pensioners, would not have power to interfere in joint consultation and negotiations about pay and future pension arrangements for existing public servants.
913 In this Bill I propose an independent Commission, but if anyone can put forward a better bit of machinery, I will gladly consider it and do my best to accept it. But it is not good enough merely to say that the present system will do in the future, because it will not.
Lastly, I come to the question of all-party support. As I said at the beginning, I attempted to choose a subject which is not controversial in terms of party political dogma, and I believe that that certainly should be true of this Bill. My party is certainly committed to action on these lines up to the hilt, and I hope and believe that my hon. Friend the Member for Finchley (Mrs. Thatcher) will confirm that official commitment if she is able to speak during the course of the debate. Labour Members, too, have frequently over many years made statements which I believe commit them also up to the hilt.
I have four quotations to make, three from the debate in this House on 9th November, 1962, when we were dealing with an earlier Pensions (Increase) Bill. First, I quote the right hon. Member for Sowerby (Mr. Houghton), who was speaking then not only with his own great personal authority but officially from the Opposition Front Bench. He said:we feel bound to say on this side of the House, and I am quite certain that it will he echoed on the other side of the House, first, that the present ad hoc method of dealing with this problem is not satisfactory, and that we ought to try to find something better which will give greater certainty to those concerned … There is in our view a case in 1962 for the consideration of a progressive pension scheme in which a regular review of pensions will be undertaken by reference to some measureable and relevant criterion.Next, I quote from the right hon. Member for Dundee, East (Mr. George Thomson), a senior Minister of State at the Foreign Office:I think that the most important thing that has emerged from the speeches in the debate is the universal agreement on both sides of the House that there ought to be some new method of tackling these problems. We should get away from the situation in which retired public servants have to use part of their well-earned retirement in lobbying and pursuing Governments and Members of Parliament when every few years we have a fresh pensions Bill put before us.I also quote the hon. Member for Walthamstow, West (Mr. Redhead) on the same date: 914I repeat that surely the time has come to put an end to this unsatisfactory ad hoc method, the results of which are dependent on a number of purely fortuitous factors, and to build into legislation an express provision whereby these pensions shall be reviewed at regular periodic intervals. A biennial review has been suggested and would seem to be an appropriate one."—[OFFICIAL REPORT, 9th November, 1962; Vol. 666, c. 1334–98.]Finally, I quote from a letter which the Prime Minister apparently wrote to a Mr. F. Ainsworth, of Southport, which Mr. Ainsworth quoted in a letter to Public Service, the journal of N.A.L.G.O., in the December, 1964, issue. This is what the Prime Minister wrote to Mr. Ainsworth:Since we feel the position is a positive disgrace, we have persistently brought this up in the House of Commons, and criticised the Government for its meanness. We have also called for public service pensions to be linked to some economic indicator, so that pensioners are not only compensated for rising prices, but also receive their full and fair share in rising national prosperity.I could give many more quotations, but I have selected those four because they are extremely significant—the right hon. Member for Sowerby, until only a few weeks ago a very senior member of the present Government; the right hon. Member for Dundee, East, currently a senior member of the Government; the hon. Member for Walthamstow, West, only a few weeks ago a Minister of State in one of the present Government's most important Departments; and, finally, the Prime Minister, who, as far as I know, is still Prime Minister.
I am sorry to say that, with courtesy—I appreciate the courtesy—the Government have indicated to me that they intend to oppose the Bill. If so—I appreciate the courtesy of being given this advance notice—I beg the Financial Secretary to reconsider that decision. I and my sponsors have tried our best to make the Bill acceptable and not to put in it as much as we would have liked to have put in it because, rather than score points, we wanted to achieve results.
So I say this to all hon. Members present. Let us try to persuade the Treasury. Let us be flexible in being prepared to accept any suggestions for changes which the Treasury may make which might help the Treasury to put aside its objections. But, in the end, let us assert our collective will as the House of Commons; because all of us, 915 regardless of party, know in our hearts that the present system is wrong and must be changed. All of us over the years have become increasingly committed, if not to the detailed proposals in the Bill, at least to its broad principle and purpose. Let us honour our commitments. Let us in the last resort resolve to prove that Governments of whatever party are the servants and not the masters of this House and of those whom we represent.
§ Mr. Speaker
Before I call the first speaker, may I say that it is quite clear that more hon. Members wish to take part in this debate than I can possibly call. It will help me to call more if hon. Members whom I do call will make their speeches reasonably brief.
§ 11.31 a.m.
§ Mr. W.O.J. Robinson (Walthamstow, East)
I confess immediately that, on reading through the provisions of the Bill, it seemed at first glance extremely attractive. It has also been extremely persuasively argued by the right hon. Member for Mitcham (Mr. R. Carr). I was very attracted by the right hon. Gentleman's reference to the desirability of this matter being discussed on non-political and non-party lines. I assure the right hon. Gentleman that I will endeavour to approach the matter on that basis, because I believe, perhaps because of my comparative recent membership of the House, that it would be better if on matters of this description the House did not divide so sharply on party political lines.
Before embarking upon a discussion of the Bill I thought it right to do a little research into the history of this and similar projects. I am sure that the right hon. Gentleman will not mind my saying that the Bill is not a matter of original thought, because in March, 1962, a Private Member's Bill was introduced by Mr. Donald Wade, as he then was, who was at that time the Member for Huddersfield, West. Mr. Donald Wade had the misfortune of not getting beyond the first hurdle. Apparently on a number of occasions he heard that dreaded word for private Members—"Object". His Bill was never allowed to reach the stage which the right hon. Gentleman has been fortunate enough to reach today.
However, the matter was aired again in the House, as the right hon. Gentle- 916 man mentioned, in November, 1962 during the course of the discussion on the Pensions (Increase) Bill of that year. The suggestion was made on the Second Reading of that Bill that a body very comparable to the one now proposed—pensions review board, it was called at that time—should be established. Very persuasive and forceful argument was levelled against that suggestion by the right hon. Member for Altrincham and Sale (Mr. Barber), who at that time was Financial Secretary to the Treasury.
Our own Financial Secretary has been quoted. Perhaps I shall be forgiven for saying that apparently this is a view which is held consistently by Financial Secretaries.
Again, in Committee on that Bill a Clause designed to implement the proposal of the Bill was moved and it was very forcefully and very successfully argued against by the right hon. Member for Kingston-upon-Thames (Mr. Boyd-Carpenter), who was then the Minister of Pensions and National Insurance. Because of the persuasive argument which the right hon. Gentleman levelled, the House divided and the Clause was rejected. I see that one of my hon. Friends voted in favour of the proposal, but the whole of the Conservative Party voted against the proposal.
I approach this matter from the point of view of whether there is a need for this provision; and, if so, whether the method suggested is the best way of meeting that need. I acknowledge that it will be generally accepted that there is a very drastic need for keeping pensions under review as much as possible and taking immediate steps to increase pensions if hardship is otherwise likely to be occasioned. I should have thought that that need was adequately met at present. Since 1952 six Pensions (Increase) Bills have been introduced, in the main at two-yearly intervals as visualised by the right hon. Gentleman.
I want to quote from the debate in November, 1962, to which the right hon. Gentleman referred. The then Financial Secretary said this:Under the existing procedure the Government keep the position of public service pensioners under review, and can intervene at any time with a measure of relief without having to wait for a fixed and specific date to arrive.917 I acknowledge immediately that the Bill does not suggest a specific time for similar reviews, but it can be argued, when such words asat intervals of not more than two yearsare used, that it would tend to harden into two-year intervals.
The then Financial Secretary then went on to say:If these matters were governed by a fixed time-table it might well happen that, at the time of one biennial review, the increase in the cost of living was too small to justify any action, but that within the next year or so there were developments which, added to the increase already existing at the time of the review, amounted to a level which might be considered to justify some Government action. Under the system of fixed reviews, action would have to wait for another year—or, alternatively, it would be necessary to have a special advancement of the next review." —[OFFICIAL REPORT, 9th November, 1962; Vol. 666, c. 1406.]A Bill is introduced from time to time as the Government feel it necessary to meet a need. Surely Members of Parliament have the opportunity in their own hands of harrowing the Government if they do not believe that the Government are acting sufficiently quickly to meet a demand that exists. Questions are frequently tabled to the appropriate Ministers asking if and when a review of these pensions is likely to take place.
The Bill proposes that there should be established a Commission which would be specifically charged with keeping this matter under review and making recommendations. I should have thought that hon. Members on both sides would look askance at establishing yet another body which would take part in governmental action. It is suggested that there should be a secretariat and members of the Commission, all of whom would have to be paid. This would mean engaging additional manpower, both in the Commission itself and in the secretariat. I should have thought that the expertise was already available in Government sources to deal with this matter.
I find it intriguing that the right hon. Member for Kingston-upon-Thames, when arguing against the establishment of such a body on 20th November, 1962, quoted Sir Winston Churchill in aid. I am very proud to have been a constituent of Sir Winston's. These are the words 918 which the right hon. Member for Kingston-upon-Thames quoted:Committees which are advisers or consist of persons without administrative machines and Departments at their disposal and without responsibility for making good any decisions to which they come are an encumbrance from which I am sedulously endeavouring to free our system."—[OFFICIAL REPORT, 20th November, 1962; Vol. 667, c. 1162.]That is a very characteristic utterance by Sir Winston Churchill. I subscribe to it entirely. We want to minimise the number of outside bodies which are responsible for work in which hon. Members themselves should take an active part.
It is suggested that reports should be made at intervals. I know that these intervals could be as frequent as the Commission liked, but they would be likely to harden into certain periods. I have already referred to a former Financial Secretary's view that people might miss the boat at one review and the need for an increase might arise almost immediately and not be dealt with.
We can safely leave this to the decision of the Government and any statutory provision which ought to be made. Of course, that may not commend itself to hon. Members opposite, but, again, may I quote the right hon. Member for Kingston-upon-Thames who, in regard to this proposal, said:All that it would do would be to put, as it were, another link—the five more or less wise men of the Pensions Board—into the chain."—[OFFICIAL REPORT, 20th November, 1962; Vol. 667, c. 1158.]I am wondering whether it is necessary or desirable that we should put chains into the scheme. The right hon. Member then went on to deal with the point I have already mentioned, namely, about missing the boat in relation to the submission of reports.
Hon. Members opposite at that time clearly thought it unnecessary and undesirable that it might even put a clog upon speedy action if another body were set up to deal with the matter. We have to remember that the Government have a responsibility here, not only to the pensioners but also to the taxpayers and ratepayers who are involved in the decision. It might be useful and helpful if we had expert advice from outside, but is it seriously argued that we have not in Government Departments people who can and do advise the Government on the 919 need or otherwise for a review of pensions?
§ Mr. Eric Lubbock (Orpington)
Surely the main point here is that the advisers within a Government are not impartial. One is seeking not to impose an extra link in the chain but to ensure that the advice given to the Government on pension increases is completely disinterested and is not influenced in any way by Treasury considerations, which might have an important influence on them at the moment.
§ Mr. Robinson
I should hesitate to say that the civil servants, who would advise the Government on this matter were prejudiced in the advice which they gave. Let us remember that the civil servants themselves would be interested and involved in the matter of a pension increase. I do not accept that all or any advice given to a Government Department is prejudiced. What might be prejudiced is the slant which Governments put on the advice they receive. I could not accept the hon. Gentleman's contention.
§ Mr. Cranley Onslow (Woking)
Would the hon. Member not accept that, if the advice is independent, it should also be seen to be independent?
§ Mr. Robinson
Yes, of course; I agree. I have always been joyful about the reputation which the Civil Service has for being independent and disinterested in the advice it gives. But if we are to set up a Commission for every aspect of governmental action on which the Civil Service advises, we shall have a large number of commissions.
The Commission's job would be to report on any matter relevant to the purchasing power of pensions and benefits. We already have adequate machinery for the ascertainment and publication of information about the cost of living, the national economic situation and any other relevant considerations. Surely, if the Government wanted, or the House demanded, that they should take more independent advice on that, adequate and effective machinery exists at the moment. There is the Prices and Incomes Board, which is more than competent to give any advice that is wanted on this subject. To do what the right hon. Gentleman's Bill suggests would produce no real 920 benefit, and would only duplicate work which is adequately and effectively done already. I suggest that we should leave this matter where it remains at the moment, for governmental action in the light of advice and representations by the appropriate organisations which represent these pensioners.
Perhaps I may be forgiven if I point out—I realise that I am treading on political ground—that the Bill is related solely to a review of public service and Armed Forces pensions. But there are many people receiving pensions from public corporations and private employers who also are affected by rises in the cost of living. I understand that as many as 40 per cent. of private pensions schemes have no provision for automatic increases in pension such as operate in the Government service.
§ Sir George Sinclair (Dorking)
Would the hon. Member not accept as a logical conclusion of his argument that it is urgent that we should go ahead with this, and that the Government should set a good example to other employers?
§ Mr. Robinson
It is an extremely attractive argument, but we should point out, on the other hand, that private companies have a duty equal to that which the Opposition, apparently, regard as lying on the Government.
One accepts the need for constant review and for bringing pensions quickly into line with current purchasing power. My objection to the Bill is that it will not achieve this in any way. It will only interpose another commission into the procedure, which works reasonably satisfactorily at the moment.
§ Mr. R. J. Maxwell-Hyslop (Tiverton)
Before the hon. Members sits down, he stated that Mr. Wade, as he then was, introduced a Bill in 1962 and that the whole Conservative Party voted against it. We see from HANSARD of 27th March, 1962, c. 1026, that the Question was "put and agreed to." Would the hon. Gentleman give the reference to substantiate his statement?
§ Mr. Robinson
If I gave that impression, then I was wrong. I thought I said that in the Committee stage of the Pensions Increase Bill a Clause on these lines was moved and a Division came on that.
§ 11.46 a.m.
§ Miss Harvie Anderson (Renfrew, East)
I am very glad to be able to add my support to my right hon. Friend's Bill. I will certainly try to follow your advice, Mr. Speaker, in being as brief as possible.
We must all remember that the purpose of the Bill is to establish a Commission which can make recommendations only. It seems that this is a modest request, and I will endeavour to show that this might well be a more appropriate time to accept it than was possible heretofore.
The frequency with which this Bill is introduced is surely no argument against it. The hon. Member for Walthamstow, East (Mr. W.O.J. Robinson) appeared to put forward a rather forceful argument in favour of the Bill when he expressed his own initial reaction to it. There is undoubtedly a situation here where the initial reaction and response to the Bill must be one of support, and the frequency with which it appears in one form or another argues both for its need and for the degree of interest and support it commands in the country.
No section of the community can be more deserving than this one. While I accept the argument that there are other sections of the community equally deserving, that cannot be an argument for denying the section with which we are dealing today. All have served us extremely well, and all hon. Members must be greatly tempted to quote verbatim from the hundreds and, indeed thousands of letters which collectively we have received from time to time. Therefore, we can be in no doubt whatever as to the feeling of thousands and tens of thousands of our supporters, and, indeed, of those who throughout the country do not necessarily support the Opposition.
But I wish to refer particularly to the question of anomalies as they apply to two groups of people. The first group are those who have retired from the women's Services. The second are those in the teaching profession. There are anomalies in the women's Services which it may be possible to put right by courses other than recommendations from a Commission of the kind suggested, but the fact remains that they have not been put right so far, despite their having been 922 brought to the Government's notice and, incidentally, pressed by such excellent bodies as the Officers Pensions Society and others.
I understand—I have had two cases put to me—that if an officer of the women's Services dies whilst serving, a gratuity but no pension may be paid to her children, if any. This is a complicated subject, and in certain circumstances the widower of a woman who has served in the Forces may have a pension if he was dependent upon her, but there is nevertheless a glaring anomaly here which deserves attention. Second, if the death of a woman member of the Forces is due to service, a pension is in certain circumstances payable, but if she dies from ordinary causes while in the Service this is not possible.
I use those two cases as examples of the kind of anomaly which the proposed Commission would investigate and make the subject of recommendations. I hope that such a Commission would bring considerable pressure to bear upon the Government of the day and, perhaps, have greater success than hon. Members have had when putting specific cases which have been brought to their attention.
Next, the teaching profession. I have in mind teachers who retired many years ago. This is the familiar case which no one promotes more frequently and energetically than my hon. Friend the Member for Tynemouth (Dame Irene Ward). The Government tend to forget that women have dependants. There are frequent cases of a woman teacher, often the youngest member of the family, who retires to support two elder sisters or others dependent upon her and who has to do so on what becomes a very slender pension. She may well retire before the ultimate retirement date in order to maintain the household at all. I have had put to me recently five such cases in which there is definite hardship as a result of the limitations of a pension established at its present rate many years ago. We ought to make a special point of considering those who have long retired.
The hon. Member for Walthamstow, East referred to the Bill brought forward in 1962. In fact, the present situation only serves to emphasise the appropriateness of my right hon. Friend's Bill now. The cases which have been brought to 923 my notice and the notice of other hon. Members recently are all the stronger because of the rise in the cost of living since 1962. For example, there are many people in modest circumstances—this is particularly true of those who own their own property and have to face such burdens as a far too great annual increase in rates—who, when an emergency arises, resort from time to time to modest borrowing. This is now not possible for them. In today's post I have received information about two cases of pensioners who are unable to meet their financial obligations because of the rise in their rate assessments.
It seems to me, therefore, now that there are severe restrictions on borrowing and a significant rise in the cost of living, this is the most appropriate time of all to go some way towards parity of pensions or, at least, to go as far as the Bill proposes.
I put it to those who oppose the Bill that they should remember, before voting, that the Bill is designed to set up a Commission to make recommendations, and the way the Commission proceeds will depend largely upon the accumulation of cases such as I have instanced. When the full weight of these cases becomes known to a single body whose first responsibility it is to consider them, no Government will be able to refuse the merit of the cases put.
§ 11.55 p.m.
§ Mr. A. H. Macdonald (Chislehurst)
I listened with great interest to the right hon. Member for Mitcham (Mr. R. Carr). He has been in the House for 17 years. I have been here less than one year, but I can humbly say that I share his interest in this subject and his concern for pensioners. After my election, the very first deputation I received was a deputation from public service pensioners, and I suppose that the first deputation a new Member receives fixes itself in his mind with particular force—unless, perhaps, the deputation lacks the usual eloquence, This is, therefore a subject which concerns me deeply.
Although I entirely agree with the right hon. Gentleman that the present state of affairs is unsatisfactory and requires amendment, I cannot agree with the amendment which he proposes. In my view, in comparison with what ought to be the situation, the difference between 924 the present state of affairs and the change which would be brought about by his Bill is not very significant.
No one will deny that the present state of affairs is far from satisfactory, when public service pensioners have to agitate and ask for increases. Could anything be more degrading to a man's dignity'? From time to time, at irregular intervals—how right the right hon. Gentleman was to stress the irregularity of the intervals—the Government, out of their bounty, distribute an increase almost as though pensioners were a race apart from ourselves, a sort of English Hottentots to whom we could distribute a little from time to time. This is not the way to conduct our affairs. Our senior citizens are one with ourselves. We ought to treat them with more dignity than this irregular bounty from time to time.
The indignity of the situation is in no way mitigated by occasional measures to provide free public transport or concessions on this or that. This is not satisfactory either. Pensioners want to stand on their own feet, with manly dignity, paying their own way out of their pensions as they did when in full-time employment, not being dependent on a small pension and odd concessions here and there for which they have to produce a pension book or something of that sort. This is no good.
The present situation should not be allowed to continue for a moment longer than can be avoided, but the proposal for a Commission is not greatly better. It is better, but only marginally so. The concept of a Commission reviewing matters from time to time implies the possibility that it will recommend an increase, but it implies also the possibility that it will not recommend an increase. In any event, as I understand the Bill it would be only a recommendation and the Government might not see their way to agree. What I suggest is that there should be some kind of automatic proposal for increases when they are necessary rather than a review or a bounty from time to time.
Surely, the right to a pension arises from the fact that while he was in employment a pensioner worked and contributed his labour to the community. It is this that creates the right to a pension. The mere contract of employment 925 which a person enters into, providing particular terms for a pension, is only the rather old-fashioned, inefficient and archaic measure that we use to estimate the amount of the pension. It is not the contract that creates the right to a pension. Surely, a pension should be related either to the work that a man did when he was working or to his need, or to both, and not the mere fortuitous amount stipulated in the original contract of his employment.
If the cost of living increases but pensions are not increased, it is not too much to say that the pensioner has been robbed by this increase in the cost of living. Surely, therefore, any provision that we make for pensions should be of an automatic nature so that the pension goes up automatically without the necessity for asking for an increase and without even the necessity for reviews. I see no satisfactory means of bringing this about except by the introduction of the concept of parity.
I fully agree that the right hon. Member for Mitcham could not, in a Private Member's Bill, introduce the concept of parity, but it was grievous to hear him referring to this as a desirable thing in principle but something to be achieved only in the rather distant future, rather like St. Augustine praying to the Lord to make him chaste but not yet.
The way in which to approach this matter is to press on all possible occasions for the immediate introduction of the concept of parity. That would be far better than the present situation and far better than the proposals in the Bill. It would be fair and just in relation to the work that a man has done and the need that he has. Until we achieve this, I greatly fear that proposals such as these, well-meaning and well-intentioned though they are—and I heartily support the principle behind them—are no more than a mere tinkering with the problem.
It seems to me that that principle can be introduced. I have recently had correspondence with the Treasury on behalf of a constituent, and I should like to give an interesting quotation. The Treasury writes to say:When retrospective pay increases are implemented after a civil servant has retired, not only does he receive the full amount of additional pay due to him in respect of service 926 up to the date of retirement, but his pension is also recalculated retrospectively and the higher amount paid from the first day of retirement.If that is not exactly parity, it is something which is dressed up to sound very much like it. I may say that my constituent has the top copy of that letter and he and I will be watching like hawks when he retires to see that that promise is fulfilled. That, however, is not the point. The point is that evidently it can be done in the case of the man in question. Therefore, I see no reason why it should not be done for all.
It is true that the objection commonly raised to the principle which I advocate is that it would be extremely expensive. That is a curious argument. If the value of a pension has decreased due to the cost of living, I suggest that the pensioner has been robbed of what he was entitled to and it is very odd to say that it is expensive not to give it to him back. We ought to have a proper sense of priorities in this matter.
I note that consideration is being given to an increase in family allowances. I do not want to appear to be knocking that proposal, but I would have thought that the case of the pensioner should take priority. After all, the pensioners will not be around for all that long and they should not have to wait to enjoy the increases to which they are entitled. Otherwise, it will be too late.
It seems to me that the question of pensions is the social problem that our society is facing, partly because people on the whole now tend to live longer, so that after retirement a man can look forward to a fairly extensive period of reasonably active life and, therefore, will be drawing his pension for longer and the amount involved is necessarily greater.
There has also been a change in the fabric of our society. In the past, people lived in large families, so that an old man or an old woman was supported by his or her descendants and relatives living in the same house. Now, families tend 'to be smaller. As soon as sons and daughters grow up, they wish to move off to their own houses, and parents are left behind and it is no longer as convenient or practicable for them to be supported by their families. If large families no 927 longer exist in the same building and cannot support their senior citizens, it seems to me that the community must support its senior citizens and take the place and fulfil the function of what the family used to do. If this be so, surely we as a society should reconcile ourselves to the fact that the amount which we provide for pensions must be greater than it has been in the past.
I do not see why we should not work out a percentage of the gross national product and set it aside to be devoted to pensions, so that as the gross national product increases, so the amount available for pensions should automatically increase. It is this concept of an automatic increase that seems to me to be absolutely at the heart of what we ought to do for public service and Armed Forces pensioners.
§ Mr. A. P. Costain (Folkestone and Hythe)
Can the hon. Member explain why the suggested Commission could not put forward those proposals and work them out in detail to overcome the stony heart of the Treasury?
§ Mr. Macdonald
There is no reason why the Commission should not work out these details but, as I understand the Bill, they are specifically stated to be only recommendations. The Commission might not come to the conclusion which we desire. Even if it did, the Government of the day might not accept them. I would not be satisfied with any set of recommendations. What I am advocating is something inevitable and automatic. Unless we have this concept of an automatic increase, I greatly fear that proposals such as this will merely put off the day when we come to a fundamental treatment of pensions in the way that we ought to do compatible with a civilised society.
§ 12.8 p.m.
§ Sir Lionel Heald (Chertsey)
In congratulating my right hon. Friend the Member for Mitcham (Mr. R. Carr) on his presentation of the Bill, I would like to say that, having been involved in much discussion on it, like my hon. Friend I have, I think, make the same speech six times. I shall certainly not repeat it today.
I wish to emphasise the importance of appreciating that this is not a party mat- 928 ter of any kind. Without, I hope, being in any way offensive, I want to say a word about the speech of the hon. Member for Walthamstow, East (Mr. W.O.J. Robinson), who admitted that he was making a party matter of it. It has not been a party matter. It has been one of those splendid examples, which are particularly illustrated in Private Members' Bills, of back benchers against the Government. There is no differentiating between successive Governments in this matter.
In 1962 I raised the question of a review. My speech was sandwiched between two other speeches which were much more important than mine. One of them was made by the late Mr. Chuter Ede and the other was made by the hon. Member for Southampton, Itchen, and we all said the same thing. It is something to remember and to be proud of in being able to do that in the House of Commons.
We complain of the Executive's attitude in this matter, and I want to refer briefly to what was said by the Financial Secretary in November, 1965. I wish to make an apology to my right hon. Friend because my name is not on the back of the Bill. I am afraid that omission is due to an oversight. I certainly intended to put my name there, and I thought I had made arrangements for that, but, unfortunately, I seem to have failed to do so. That, however, does not in any way diminish my support.
I think the House should have its attention drawn to what was said by the Financial Secretary in 1965, because it throws a rather different light on this matter from that which the hon. Member for Walthamstow, East shed. The hon. and learned Gentleman then said:A number of hon. Members have again raised the question of whether we should not have built into our system some kind of automatic increases or reviews. This is a point of view with which I have a great deal of sympathy, but I must again point out that this is an interim, temporary Measure and that it would be wrong to try to introduce some permanent new machinery until we have devised and decided upon the permanent policy.So far as I can ascertain, there has been no evidence of serious consideration of the policy. Therefore, we are back where we were then, and the contrast is between the machinery suggested—and independent Commission—and what the 929 hon. and learned Gentleman then went on to describe, which is something of the very nature which all of us on both sides of the House for years have said is very unsatisfactory. He said that there is a machinery already. He said thatthere is a section at the Treasury which, with great skill, goes into these matters and is carefully watching the whole time the position of pensions in relation to the other factors, in particular changes in the cost of living. As soon as the gap has widened to a point when it is felt that the matter should be brought to the attention of Ministers, that is done." —[OFFICIAL REPORT, 18th November 1965;Vol 720, c. 1460–61.1One can imagine no more perfect description of this slipshod machinery which has been working in these matters. It is the very thing which hon. Members then said it was and which they again have emphasised that it is—a hand-to-mouth business of always trying to catch up from the back of the queue.
That is what we are trying to get over. Again I say that if I criticise the hon. and learned Gentleman, I do so not because of the party he belongs to but because of the stable he comes from, the Treasury stable. This is one of those changes which are long overdue. I hope that hon. Members on the back benches on both sides of the House will take this opportunity of showing what they stand for.
§ 12.14 p.m.
§ Mr. John Horner (Oldbury and Halesowen)
I should like to follow the point made by my hon. Friend the Member for Chislehurst (Mr. Macdonald). I agree with him that I do not think that the objectives of those hon. Gntlemen on both sides who have spoken this morning would necessarily be served by the establishment of a Commission. It has been pointed out that action rests with the Government. What I am concerned with is to see action on this matter, on which there is very wide feeling, not only amongst the pensioners, which have been articulate and vocal on this, but, of course, amongst the organisations which represent the people who in due course will become pensioners. This matter has been ventilated most widely over recent years. Hon. Gentlemen have referred to the fact that it has on earlier occasions been the subject of debate in this House. What I want to urge upon the Front Bench en our side is that it is really 930 about time the Treasury made good the promises which it has given to the various staff associations in the Civil Service and in other Government employ, and which have tried to bring this matter before the Treasury from time to time.
I want to refer to the Pensions (Increase) Act, 1965. As was proper, the subject was earlier under discussion between the National Civil Service Whitley Staff Side, the Trades Union Congress, and representatives of the Treasury, and I would like to draw to the attention of the Financial Secretary what the Treasury representatives are reported as saying at that time.
At that time the staff associations in the Civil Service and other trade unions representing civil servants tried through the Trades Union Congress to impress upon the Treasury that it really was time that this old practice was abandoned, the practice by which, as the right hon. and learned Gentleman the Member for Chertsey (Sir L. Heald) reminded us, it was left to civil servants to draw the attention of the Treasury to the existence of a widening gap.
Of course, it was not only civil servants in the Treasury who drew attention to the existence of a widening gap, but it was the agitation and the pressure of the normal representation which takes place between the trade unions, the T.U.C., and the Government when they try to get effective Government action to narrow that gap. What the Staff Side of the Whitley Council said was that there should be an automatic review every two years; they said this was a reasonable request, that that review should take place in association with the Treasury and the staff associations; the staff associations would be in close contact with the pensioners' representatives and organisations; we would forgo the agreed procedure of agitation and public representation and private representation; and we would know where we stood.
I want to ask my hon. and learned Friend what his observations are on the report which was given to the T.U.C. by the Treasury objecting to the idea of a two-yearly review. The Treasury is reported as having informed the T.U.C., which was supporting the National Whitley Staff Side in the Civil Service on these matters, that the main reason 931 for not adopting such a proposal was its inherent rigidity, that if an increase were justified at one review, then it would be two years before the next one, whereas the conditions might change so as to justify an increase within a very few months.
This is wonderful, I think—the idea that the Civil Service staff associations were proposing too rigid a proposition, that they might thereby be denying pensioners opportunities which the Treasury, within a few months, because of its generosity and good will, might find itself expressing through proposals to the Chancellor that there should be another Pensions (Increase) Bill—within a few months of the biennial review. I do not know what world the Treasury officials were living in when they made that proposition.
But may I address to my hon. and learned Friend this morning what the subsequent report said:The Treasury agreed, however, to consider whether some different procedure might not be adopted in the future.I do not believe that a Commission will answer that. Before this debate is over, we ought to have some statement from my hon. and learned Friend to indicate whether the Treasury has been able to pursue the course which was adumbrated in the Report to the Civil Service Staff Side of the National Whitley Council some three years ago.
It is a matter on which there is strong feeling in all parts of the House, and there is very strong feeling amongst local government pensioners. I myself have some association with a large number of men who have served the country well in the Fire Service. They believe that, somehow or other, there has to be a more regular and manifestly more just system of modifying and improving public service pensions than we have seen hitherto. I believe that the Treasury ought to be asked to tell us what it has done since it met the T.U.C. three years ago.
§ 12.20 p.m.
§ Mr. Anthony Kershaw (Stroud)
I am sure that many hon. Members will have great sympathy with the remarks which we have just heard from our visiting fireman, the hon. Member for Oldbury and 932 Halesowen (Mr. Homer). The Treasury ought to clarify its ideas about this matter.
May I first deal with the interesting point raised by the hon. Member for Chislehurst (Mr. Macdonald) about the automatic increase? I appreciate that it is good for the dignity of a person not to have to ask all the time. However, the hon. Gentleman's proposition has a number of defects. If there is to be an automatic increase, we must make sure that, by and large, the system is fair, otherwise injustices which may be built in at present will be perpetuated. There are so many anomalies now that something like a Commission is needed to get them all together and present them to the Treasury to see if a proper regime can be established before moving to an automatic increase, which, of course, is a different argument.
There is no doubt that such a Commission would be yet another body. To that extent, perhaps, it is a small defect in itself. But it accords with natural justice that negotiations on a very human matter like pensions should be conducted more or less in the open. At any rate, one should know what is being done on one's behalf. The sorts of representations which have to be made now are humiliating. In making them, one does not know whether the Treasury is on one's side or not. Those of us who object to it ask ourselves whether, in other walks of life, we would be content to find our cause represented in secret by people who are, after all, the judges in the matter as well. Would trade unionists be willing to accept a wage rate fixed by a body on which trade unionists were not represented? I feel sure that they would not, and nor should anyone else.
The interventions which are made by the Government from time to time on pension increases can be made more often than a Commisison would recommend. Indeed, they can be made more often than two years. But experience tells us that they have not been. There have been delays and they have been arbitrary, which is very unsettling for those on the receiving end.
There are so many anomalies that in some cases it is difficult to know where to start. It is not my intention to delay the House too long, so I will dovetail some of them as much as I can.
933 The Armed Forces pensioners are in a category which entitles them to think that they are worse off than others. Normally, they retire earlier and, under present regulations, they are not entitled to an increase until they reach the age of 60, having retired at an average age of 45. In other words, they suffer 15 years of inflation before getting any increase. They then share in the increase given to civil servants and others, but they share on a percentage basis on the pensions which they had when retiring 15 years previously. With inflation running at about 5 per cent. a year, a man retiring on an annual pension of £800 is in the position that by the time he is 60, if his pension is to give him the same purchasing power, he should be in receipt of £1,400. However, he gets only a percentage increase on £800, thus lagging behind his colleagues in the Civil Service.
Another point, of course, is that percentage increases give the smallest increase to the smallest pensions. An officer retired on the pre-1919 code at lieut.-commander or major level today gets £693. If the purchasing power of his pension had been maintained, he would be receiving £1,620, which is two and a half times as much.
The Prime Minister has frequently alluded to the erosion of pensions. In September, 1964, he made the pledge that Service pensions would keep their purchasing power, instead of being eroded as they have been in recent years. I am certain that he intended to keep that pledge, as any aspiring Government would, but it has not been done.
A widow gets a third of her husband's pension—which is a very small sum—and percentage increases on that. The result is that widows of Service men, who may have lost their husbands young in the service of their country, in many cases are the poorest in the land. A great many of them are on National Assistance, and I do not think that that is a fair way to treat them. The widows of ratings and other ranks discharged before September, 1950, receive no pension at all. I have never been able to understand the justification for that.
Then we get the case of a widow who remarries after her husband's retirement, in which case she gets no pension at all. Hon. Members may care to contrast that with what we provide for ourselves. If 934 any hon. Gentleman suffers the indignity of being dismissed at the next election and seeks to console himself with matrimony, he can be confident that, when he dies, his widow will get a pension for the contributions which he has made. If we get it ourselves, I do not see why we should not ask the Treasury to make similar provision for these widows.
A particularly niggardly matter is that a Service widow who remarries, forfeiting her pension, and is then widowed again gets her pension back only after a strict means test, which takes into consideration any income over £200 a year. Those pensions have been paid for, although they have been noncontributory. I am not sure about the position in regard to that. The Treasury argues sometimes that, because there have been no contributions towards widows' pensions, they are not entitled to have the same sort of consideration as if they had been contributed for. On other occasions, it has said that officers and other ranks are paid at a slightly lower rate because they do not have to make contributions for pensions. The Treasury cannot have it both ways.
It has been argued from the Government Front Bench on many occasions on behalf of different Administrations that the rise in the cost of living to some extent is taken care of by the National Insurance pension, which has gone up more than the rise in the cost of living, but three-quarters of retired officers and their widows are either too old or too young to have any National Insurance pension, and therefore that does not apply to them.
I agree that the pensions paid today to officers and other ranks retiring are not too bad, but we have this long series of anomalies, built up over the years. To regularise the position, we should have a levelling up operation. It has been proposed that it should be on the basis of the 1956 code, which would cost £11 million in a year, of which £4½ million would be in respect of Civil Service pensions and £6½ million in respect of Forces pensions. This is much less far-reaching than the proposition of parity made this morning and on other occasions by leading members of the party opposite.
That parity is something which we would all like to see, but the amount of money involved is very large, and, as the 935 hon. Member for Chislehurst recognised, would not be within the power of my right hon. Friend to provide. I believe that only a Commission can bring all these anomalies into focus and exert the necessary pressure on the Government in a non-party way which will bring them to remedy the situation.
If we can have this levelling-up operation to get people who have had pensions in the past more or less on to the footing of what their contemporaries get today, we can then consider putting future pensions on a much more suitable basis, and we can talk sensibly about automatic increases and the relationship between different classes who are equally deserving, and I very much hope that the House will consent to give my right hon. Friend's Bill a Second Reading.
Even if the Government feel that the Bill might prejudice the grand review of pensions which we have been told is coming out at some time, I think that they ought to allow it to go to Committee where the matter can be thrashed out and properly discussed. We know that individually Members of the Government are not opposed to the principle of the Bill because they have often spoken in this sense themselves. Therefore, surely it is logical, and in the tradition of the House, that we should have the opportunity to go into this Bill in detail in Committee, where we can clarify our thoughts, and the Government can put their arguments, rather than reject the Bill out of hand as they seem likely to do.
§ 12.31 p.m.
§ Mr. Peter Kirk (Saffron Walden)
My right hon. Friend the Member for Mitcham (Mr. R. Carr), in moving the Bill in such restrained and felicitous terms, referred to the fact that he had seen many of these problems from the other side of the fence. I have, too, and it is this which impels me to speak for a short time this morning.
I do not suppose that any of the matters with which my hon. Friend the Member for Harwich (Mr. Ridsdale) and I dealt at the Ministry of Defence caused more trouble and concern than this one. I do not suppose that there was any matter on which we were more powerless to do anything, because whenever we had 936 discussions about individual anomalies. or general anomalies, at some stage in the discussion somebody would say, "I am sorry, but the Treasury will never agree", and that was the end of the argument.
We all know who the enemy is. It is not the Minister on the Front Bench opposite today, or the Ministers who used to sit there. It does not make a blind bit of difference who is sitting on the Government Front Bench. The enemy is the Treasury machine. I am not attacking individual civil servants. They are all involved, too. It is precedent which has built up over the years in this matter, which apparently we cannot shift. When people complain about precedents and procedures in this House, they ought to look at precedents and procedures in the Treasury and see whether they can be reviewed, perhaps even in the haphazard way that the Government are reviewing procedure in the House of Commons.
The whole question has been a football between the political parties. Each party, when it is out of office pleads for action, but when it gets into office it turns it down. It does not matter what the House thinks, what individual Ministers think, or what the Opposition think. No results are ever achieved, and this is why I support the Bill.
I agree that this Measure has deficiencies. I think that what the hon. Member for Chislehurst (Mr. Macdonald) said is right, and perhaps it will not achieve enough. Certainly the responsibility will rest finally, as it should, with Ministers and with the House, but this may be the only way of breaking into this magic circle and getting some daylight reflected on to this subject, and if this Measure can do that it will achieve something.
My right hon. Friend mentioned two specific matters with which this Commission could deal. The first is the question of a general recommendation about the need for increases in pensions. The suggestion was made, I think by the hon. Member for Walthamstow, East (Mr. W. O. J. Robinson), that this was not necessary because all the information was available, and indeed we know from my right hon. and learned Friend the Member for Chertsey (Sir L. Heald), that there is a team in the Treasury whose job it is to bring to the attention of Ministers the widening of the gap. But 937 the point is that the information presented to Ministers is confidential to them, whereas the information presented by this Commission will be seen by everyone and we shall be able to judge whether the time is ripe for a pension increase, instead of having to rely on information, I am sure is accurately presented, but perhaps partially presented in the sense that only part of it is given to the House by those Ministers.
It is not just a question whether the cost of living is high. There are other matters which have to be considered, and perhaps I might mention one. It would, perhaps, be almost impossible for me to make a speech without mentioning the European Economic Community. If the Prime Minister is successful, we shall enter the Common Market, and one of the principles of the Treaty of Rome is parity in the social services. I suspect—I do not know, and I would be interested to hear what the Financial Secretary has to say—that we in this country lag behind a number of countries in the Common Market in our treatment of State and Service pensions. If the proposed Commission were set up, it would surely be important for it to draw attention to this situation and to propose ways in which it could gradually be rectified. This would be a valuable service, and I do not see how it could be done in any other way.
The second point mentioned by my right hon. Friend was the question of the anomalies which need to be cleared up, and my hon. Friend the Member for Stroud (Mr. Kershaw) mentioned a number of them. The pension codes are a jungle which even lawyers of considerable repute find it difficult to make their way through. Men who retire one day early, or two days late, get, or do not get, pensions on a purely arbitrary basis. I remember one case which went on for seven years, with three Adjournment debates in this House, and the matter was still not settled satisfactorily. It all turned on the question of the day on which a certain message had been sent from one station to another. It is ridiculous that we should have to spend so much time arguing how much money a man will get when the decision turns on matters such as that.
938 All these anomalies would not, of course, be wiped away if we introduced a system of parity. For instance, the whole question of officers in the women's Services and the whole question of widows' pensions would still remain anomalies whether we had parity or not, because here there are cases in which, for some reason which I have never been able to fathom, people are not entitled to pensions at all, though other people in similar circumstances are entitled to them.
Simple as it would be to settle on parity, this would not deal with the matter entirely. There would still be a number of cases of injustice which would stand out even more glaringly if all the others were settled. I therefore think that there is a case for a Commission of this kind. I do not think that it is a sufficient argument against it to say that because private pension schemes do not have automatic increases, therefore the State should do nothing about it. I do not think that this argument is worthy of the House.
We are responsible first and foremost for our servants, and they are the people about whom we can do something. They are the people whose present position everybody who has spoken in this debate agrees is unsatisfactory. If anyone can produce a better system, let him produce it. The only suggestion that we have had was that from the hon. Member for Chislehurst, for an automatic increase, but there are certain objections to this, and because I believe that we must find some way of breaking out of the Treasury cocoon, I shall cheerfully vote for the Bill.
§ 12.38 p.m.
§ Mr. Julian Ridsdale (Harwich)
As many hon. Members wish to take part in this debate I shall not speak for very long, but I agree with my hon. Friend the Member for Saffron Walden (Mr. Kirk) who said that we have to break out of this Treasury cocoon, this straitjacket in which the Treasury has kept public service pensioners ever since 1945.
I congratulate my right hon. Friend the Member for Mitcham (Mr. R. Carr) on having brought in this Bill, and I only hope that the Treasury will not be so hard-hearted as not to accept it. If it does, it will mean that for the first time since 1945 the Treasury will be accepting 939 some discipline on itself, and every time it spends more money than it should, or allows Government Departments to spend more money than they should, it will not be the poor Service pensioners and public service who will have to foot the Bill.
The hon. Member for Walthamstow, East (Mr. W. O. J. Robinson) opposed me in 1959. If he had stayed in Harwich longer, I am sure that he would not have spoken nearly so complacently about the position of the public service pensioner.
§ Mr. W. O. J. Robinson
Does not the hon. Gentleman realise that if I had stayed in Harwich longer he might not have had the opportunity of making the speech he is now making?
§ Mr. Ridsdale
No. I thought that I might have educated the hon. Member better during the time he opposed me.
What concerns me is the fall in the value of money. Even in the past two years the value of the £ has gone down by 1s. 9d., or nearly 10 per cent. That is a drop in pensioners' purchasing power of £50 in £500, £100 in £1,000 and £150 in £1,500. Yet the Treasury Front Bench is still so complacent that it says that it will oppose the Bill, in spite of the promises made by the Prime Minister in 1964, when he said that the pensioners' position was an absolute disgrace. What broken promises? I hope that the Treasury will think again about some of those words.
On Monday my hon. Friend the Member for Gillingham (Mr. Burden) asked how much the position of the retirement pensioner had fallen behind prices and how much it would cost to restore that position. The answer was £135 million. I asked how much it would be for the pensioner to be put in the same position relative to the wage-earner as when the last pension increase was made. I was told that the figures were not available.
I believe that they are available but that the Treasury Front Bench is frightened to give them because the pensioners' position has fallen behind the wage-earner so much even in the past two years. It was for that reason that I wished briefly to intervene in the debate and to try to bring home to the Government what seems to many of us to be the hypocrisy with which they made their 940 promises before the election as shown by their deeds now. Let us have more sincerity.
§ Mr. Macdonald
The hon. Gentleman must surely be aware that it is not yet 18 months since a Pensions (Increase) Bill was carried through the House. I agree that the position is unsatisfactory, but the strictures he is now dishing out are remote from the facts.
§ Mr. Ridsdale
I do not know—losses in incomes of £50 in £500 and £100 in £1,000 in those two years are very considerable to those who are having to eke out their incomes when faced with the kind of prices we must pay today. I recognised that the hon. Member is sincere, but I think that when he considers the matter in his heart and looks at the facts he will realise that the Government have a great deal to answer for at present.
§ 12.47 p.m.
§ Captain. Walter Elliot (Carshalton)
It is something of a tradition of the House that our deliberations on Fridays are non-controversial. My right hon. Friend the Member for Mitcham (Mr. R. Carr) introduced his Bill moderately and reasonably. It came as something of a shock to me when he said that the Government had intimated that they would not accept it. At best, that makes our discussions somewhat academic, and, at worst, a complete waste of time. I should have thought that they would accept it, that they had every reason to do so.
Their pledge just before the 1964 General Election about parity of pensions must weigh very heavily on their consciences. I shall not go into the arguments for or against that. But I consider the Bill to be a very practical alternative which would in time go a long way to lessen the difference in pensions between those who are retiring today and those who have retired in earlier years.
If the Treasury, or the Treasury Ministers, are frightened of the financial cost I have a practical suggestion on how they could get over that problem. When a man enters the public service he is offered certain conditions, which include his retirement pension. That might look pretty good when he enters public service. Over his period of service it may change, and 941 when he retires today it is generally enough to live on. But erosion through inflation begins to make a difference.
We can argue for a long time as to whose fault that is, but it does not get us very far. The point is that inflation is not the only reason why the public service and armed services pensioner falls behind. To a great extent the blame lies on those who negotiate salaries on the behalf of the staff side of all the various categories of public servants. Men and women in the services of all sorts owe much to successive Conservative Governments. We accepted the principle of comparability for the Civil Service and the fighting services.
The acceptance of the Grigg Commission Report, the biennial review of Service pay and pensions have brought financial benefits to all the people working in their various professions today. They are well paid and retire with good pensions. But in the past they have scraped the bottom of the Treasury barrel with their demands, without thinking about the old retired people from their own professions.
My right hon. Friend mentioned that, and spoke of the pressures on the officials from their members. They are paid by the members, who exert pressures, and their jobs depend on their members' support. There is a good deal in what my right hon. Friend said, but is it asking too much to suggest that those negotiators should have the charity to forgo a small fraction of the extra money made available in order that a comparable percentage should go to those who retired earlier? I do not believe that that percentage would be very large. The number of retired people in any given profession is fairly small compared with the number of serving members, and the average pension level is perhaps half the average salary level.
Therefore, I do not think that the sacrifice would be very great. It has been argued that those who are currently earning have a right to be better off, as they are producing the country's wealth, I cannot accept that. The average pensioner lives to enjoy his pension for less than 20 years, and what happens in the country will have been decided, for better or worse, quite as much by what was done before retirement as after.
942 It will be argued that negotiations are a matter of bargaining. That is true. It is argued that the staff negotiators would pitch their demands higher to get what they regard as the right amount for their active members, but they always do that. Their demands are always too high, but in due course an offer would be accepted. The association or union concerned would then be told that if members wished their retired former colleagues to share in the settlement a small amount would be subtracted from the sum awarded. That would be done in public and if the representatives of the working members insisted on grabbing the lot, public attention and comment could be focused on them.
The case of the Fighting Services is different. They have no union to put their case, but the senior active service officers have great influence. In the first place, the biennial Service pay review which has been accepted by successive Governments was primarily based on recruiting needs, but that is not a serious reason today. Pay and pensions are well above what is necessary to attract recruits.
The Government could say, of course, that the principle which I have advocated should in future be applied to Service pay awards, that a small percentage would be deducted and given to retired older officers. This would not necessarily apply to all of them. An age level might be selected above which those pensioners would receive this extra money.
But that is not the way to do it. The Government should not do that. I would like it to come from the Services themselves. It should be announced that it is being done at the request of the professional members of the governing bodies of the Service. Properly explained, I am sure that it would be accepted by the vast majority of the men in the fighting services and it would help to improve recruitment. Pensions and what retired members of a Service say have a great effect.
That would give the moral leadership. If the Fighting Services do it, it is reasonable to expect the Civil Service and the associations of other professions to follow suit. If they do not, the nation can take account of that and discount the arguments which they put forward for their own members.
943 The Bill will provide the machinery for the sort of increases necessary to keep our pensioners in step with the rest of the nation. One hon. Member opposite said that it was the duty of hon. Members to harry Governments to do just this, but one of the purposes of the Bill is to avoid that and to take it out of party politics. I believe that the Bill will do that. I hope that the Government will accept it and consider my suggestion for raising the money. I know that a Government cannot go on producing enormous sums year after year, but I believe that the method which I have suggested might be effective and I hope that they will consider it carefully.
§ 12.53 p.m.
§ Mr. Eric Lubbock (Orpington)
I congratulate the right hon. Member for Mitcham (Mr. R. Carr) on the moderate and lucid way in which he introduced his Bill. My party and I are wholly behind the objectives which he stated. Here at least is a constructive suggestion for getting away from the periodic Pensions (Increase) Acts which have been so heavily criticised by back benchers on both sides. The right hon. Member said, logically, that if pay and conditions of Service men are reviewed regularly and openly, why should not their pensions be reviewed in this way as well? To extend this principle to the whole public service is equally logical.
It is interesting to look back at discussions on similar proposals. The hon. Member for Walthamstow, East (Mr. W. O. J. Robinson) mentioned the work done by my noble Friend Lord Wade in the Pensions (Increase) Act, 1962, when he put forward a similar proposal. He called it the Pensions Review Board instead of Commission, and the matters which it was to consider were not exactly the same as those embodied in the Bill—but the principle was the same.
He suggested that reports should be made at two-yearly intervals, dealing with changes in the situation since the last review, putting in front of the Board various matters such as any change in the Pensioners' Index of Retail Prices and any other matterwhich in the opinion of the Board, is relevant to the amount of the pension payable to the members of any such class as is mentioned in subsection (a) of this section.944 That was a very broad set of terms of reference which my noble Friend attempted to give to the Pensions Review Board.
The intentions in the present Bill, which have been thought out carefully by the right hon. Gentleman and his hon. Friends, may be an improvement, but these are all matters for discussion in Committee. I should like to quote one or two things from the debate on my noble Friend's Amendment on 20th November, 1962. First of all, he quoted from a speech by the right hon. Member for Sowerby (Mr. Houghton) in introducing an Amendment. Speaking of the successive Pensions (Increase) Acts, the right hon. Member had said:One might describe it as a fire brigade method; an ad hoc method; a hit-and-miss method. Is it not time that we considered whether it is possible to devise some proper business-like system which will provide for periodic reviews when necessary by some appropriate machinery of a suitable character applying recognised criteria?That was over four years ago and we are are still no nearer to the kind of review proposed in the Bill.
Then there is an interesting quotation from the speech of the right hon. Member for Dundee, East (Mr. George Thomson). Before he spoke, there was a speech by the hon. Lady the Member for Tyne-mouth (Dame Irene Ward), who is very active in this matter and practically always attends our debates. I am delighted to see her here today. She spoke in favour of the proposal of my noble Friend.
Then, the right hon. Member for Dundee, East, speaking of the debate on Second Reading, said:There was a general feeling that this should be the last Pensions (Increase) Bill of its kind, that we should get off this dreary treadmill under which public service pensioners have to await a succession of Bills of this kind coming before the House and that we should get away from the process whereby, as soon as one Bill is safely passed and victory is won, all the pensioners organisations have to start once again lobbying Members of Parliament or pressing the Government for the next Bill in two, three or four years' time.I heartily agree with that sentiment and I am disappointed that, since the right hon. Member's party came into office, they have not carried out the pledges which they made.
945 The right hon. and learned Member for Chertsey (Sir L. Heald) said in the same debate:We want an assurance that the file is not put away in a cupboard with a sigh of relief. Thank goodness! Now we have another three years and five months before we need bother with that again'." —[OFFICIAL REPORT, 20th November, 1962; Vol. 667, cc. 1144, 1152, 1155.]One could go on selecting quotations from all the speeches in that debate from either side of the House and one would find that the unanimous view was that the Pensions (Increase) Acts, as we had known them since the war, were not satisfactory. I know practically no-one who thinks that they are, with the exception, perhaps, of the hon. Member for Walthamstow, East, who thinks that expertise already exists in the Government and should be used for determining these increases. I would disagree heartily with the hon. Gentleman. It is wrong that the employer should dictate what pensions will be payable to his employees. I know of no other sphere of life in which this would be tolerated and certainly not by employees represented by a good trade union. They would naturally object violently to any suggestion that their final pensions should be determined by their employers, with no direct negotiating machinery or arbitration.
We understand that the Government are not prepared to do anything about public service pensions until the review of social security is complete. This causes me the gravest anxiety, because the review of social service has been going on ever since the Labour Government first came to office in 1964 and practically nothing has come out of it. The right hon. Member for Sowerby whom one could trust and who, one knew, had the interests of public service pensioners very much at heart, has now left his office. No word came out during the two years he spent in the job about the Government's intentions concerning public service pensioners. Indeed, there are other very broad fields of social security which have not yet been touched by the Government.
One therefore sees the process going on for another three or four years without even a Pensions (Increase) Bill being brought forward after the same length of interval as elapsed between the 1962 and 946 1965 Acts. I would like at least an assurance from the Government that if they reject the Bill today, they will bring forward a Pensions (Increase) Bill at the end of the normal period of time such as elapsed between the last two Acts. That is to say, it has become customary for reviews to be made at intervals of no longer than three years. That was certainly the case between the last two.
I agree with the hon. Member for Chislehurst (Mr. Macdonald) that ideally one does not desire machinery of the kind which is proposed in the Bill and that if we had a strictly arithmetical calculation of public service pensions which related them to the current salaries of grades from which pensioners had retired and which related them also to the average earnings of people in similar employment, we could dispense with the machinery.
We must, however, be realistic. We stand for the principles of parity and dynamism but we cannot see them being introduced in the country's present economic situation. I doubt very much whether a Government of any political complexion would bring them into operation except over a good number of years—I was thinking in terms of, perhaps, five or 10 years—during which time these pensioners would be left in doubt about how the matter would be dealt with.
§ Mr. Macdonald
I follow the hon. Member's arguments, but does he not feel that the introduction of the suggested Commission would give the appearance of having done something effective and would in that sense defer still further the introduction of parity?
§ Mr. Lubbock
No, I do not think so. The existence of the Commission would enable public service pensioners to argue their case before a set of men and women who were appointed for the purpose and who were known to be entirely impartial. That is the main reason why one should support the proposals in the Bill and not expect the pensioners' organisations, which are not trade unions and are not organised to do this, to try to get round the Financial Secretary and his colleagues at the Treasury through some kind of back-door negotiations and by lobbying the hon. Member for Chislehurst and myself. This is, surely, a most unsatisfactory means of 947 determining pensions. On reflection, the hon. Member will, perhaps agree that even though parity and dynamism are to be aimed at in the long run, we need interim machinery which resolves the question of pensions in a more satisfactory and logical way than at present.
As to parity, I would like clarification of the Government's long-term policy. Before the 1964 election, they gave the very clear impression to public service pensioners, both Civil Service pensioners and others—it is no good the right hon. Gentleman smiling——
§ The Minister Without Portfolio (Mr. Patrick Gordon Walker)
I was not smiling at the hon. Member.
§ Mr. Lubbock
The Government certainly gave the impression to public service pensioners that they were 100 per cent. committed to the policy of parity.
The letter from the Prime Minister to Mr. Ainsworth has already been quoted. I would like to draw the attention of the House to an interesting letter from the Financial Secretary to the Treasury to Mr. Smith, of the National Association of Retired Police Officers. From this letter, which is quoted in the winter, 1966, edition of The Civil Service Pensioner, one sees how the Government are trying to wriggle out of the promises they made before 1964. The Financial Secretary to the Treasury was trying to put a gloss on what he said at a meeting which took place between the Public Service Pensioners' Council and himself on 26th November, 1964.
The Financial Secretary kept a record of that meeting. The record states:In reply to the points made by the deputation, the Financial Secretary said that the Labour Party's election literature showed that it was sympathetic towards the principle of parity.That is plain enough.The Government intended to write this principle into the National Insurance Scheme and, as a first step, had decided on the increase in National Insurance pensions recently announced. More fundamental changes in the present system of National Insurance had been foreshadowed in the manifesto and would be phased over the life of the Government.… But there were difficulties about applying this principle outside National Insurance.I want to know from the Government why those difficulties were not mentioned in any way before October, 1964. Why 948 did they give the impression to public service and Armed Forces pensioners that they adopted the principle of parity, whether in the National Insurance scheme or in any other respect? I do not think that any hon. Member on the Govern-rent side could argue with me when I say that his own constituents are telling him that that was the impression which they had and that many people voted for the Labour Government in 1964 for this very reason. I know of them because I have had letters from people, fortunately not in my constituency; there are not any Labour voters in Orpington. In many other parts of the country, however, this could have made a difference to the result of the election.
The Government in this respect have broken a firm pledge that was given to the electorate. I have said this before and I have never had a satisfactory answer from the Government Front Bench. I would like one today and I would like to hear from whoever replies to the debate that at the very least the Government are committed to producing another Pensions (Increase) Act within the three-year period and that at that time steps will be taken at least towards the principle of parity, even if they cannot accept it in its entirety at this stage. That is to say, there should he some levelling-up for the older pensioners at least to bring them up to the level which would have applied had they retired on 1st April, 1956, as I suggested last summer.
§ Mr. William Molloy (Ealing, North)
I know that the House and people outside acknowledge the hon. Member to be a sincere if somewhat naive politician, but does he really believe that within the first year of any Government's programme, which is designed, according to our Constitution, for five years, one should pick out any part of a party's policy and say, "You have not implemented this or that"? Is the hon. Member being fair, not only to the party in office, but, indeed, to his own or any other party? What he is saying is that unless a party carries out all its programme in the first couple of weeks, it is not honouring its pledges. This is ludicrous.
§ Mr. Lubbock
I will leave it to the public service pensioners to decide 949 whether it is I or the hon. Member who is being naїve. If he will do me the honour of reading my speech on the Pensions (Increase) Bill, in Committee on the Floor of the House, on 1st December, 1965, he will find that I said definitely at that time that I did not expect the Government to implement their promise of giving parity to public service pensioners in the prevailing economic circumstances. Had the hon. Gentleman been paying attention to what I was saying he would have heard me say that because of the economic crisis which the country has faced in the last year or 18 months, it would be unreasonable to expect this of any Government. However, I want the Labour Party to reiterate the pledge which they gave prior to the 1964 General Election. I want them once again to say that some sort of long-term plan is being drawn up for putting that pledge into operation.
When I spoke in December, 1965, I suggested a means whereby the Government could approach the principle of parity by taking a number of steps, the first of them being a levelling-up of the pensions which would have been received if a person had retired not later than 1st April, 1956. I considered that to be a reasonable request in view of the calculations which I had made. The cost of my proposals was quite limited—certainly nothing like the total cost of the Pensions (Increase) Act of that year. Today I am not asking, the Government to introduce the principle of parity in the next year or two or even during the lifetime of this Parliament but I want them to reiterate the pledges which they gave prior to the 1964 election.
Increases in the cost of living have already eroded the value of the increases that were given on 1st January, 1966. I received some Answers from the Financial Secretary on this point and about the increase since that date in the level of average earnings per head of the population. From those Answers one can see that, just as between the effective dates of the 1962 and 1965 Pensions (Increase) Acts there was an average annual increase in the cost of living of about 3½ per cent., so already, since 1st January, 1966, the value of pensions has been eroded by about 3½ per cent. That trend can be expected to continue.
950 Statistics issued by the Ministry of Labour for average earnings between January and November, 1966, again show that average earnings increased by just over 3 per cent. I therefore underline what has been said about the Prime Minister's promise that pensioners would not be subjected, as they had been in the past, to their standard of living being eroded but that their pensions would keep pace with the rising standards of living of the population generally. That meant to anybody that pensioners would be recompensed for the fall in the value of money which had taken place since 1st January, 1966, that regard would be had for the increase in the level of earnings of the working population as a whole and that pensioners would share in the increase in prosperity which the population in general had enjoyed.
I will condense my remarks because many hon. Members wish to take part in the debate. There may be differences of view about the matters which should be considered by the Commission; the frequency with which it should report and so on. I suggest to the right hon. Member for Mitcham that if the Commission's first report is not to be submitted until 1st January, 1969, there will be a danger that the Government will use that as an excuse for not introducing a new Pensions (Increase) Act until some time during that year. I hope, therefore, that if the Bill goes into Committee, as I hope it will, he will consider inserting an earlier date.
§ Mr. R. Carr
This is one example of the lengths to which I and my supporters have gone to try to make the Bill acceptable to the Government, bearing in mind the present economic difficulties.
§ Mr. Lubbock
I appreciate that the right hon. Gentleman has designed the Bill with that in mind. Nevertheless, it makes it all the more necessary for the Government not to do what they have threatened—to vote against the Second Reading of the Measure—but to allow it to go into Committee so that these matters may be thrashed out. If the Government have suggestions to improve the machinery of the Bill I am sure that not only the right hon. Member for Mitcham but all hon. Members who have been active in the cause of public service pensioners for many years will be only too happy to consider them.
§ 1.16 p.m.
§ Mr. Sydney Bidwell (Southall)
Having entered the Chamber rather late, it is with some diffidence that I speak because I did not have the pleasure of hearing the opening speech of the right hon. Member for Mitcham (Mr. R. Carr). However, I am grateful to him for giving us an opportunity of discussing the subject, albeit in this way, of retirement pensions and the problems that arise, for it is only right that hon. Members should care for the welfare of the unfortunate.
It is one of the oddities of this Chamber that one can come and go during a debate as one pleases. As a new hon. Member, I have found that odd, and I know that the public must find it difficult to comprehend this and other aspects of our procedure. My hon. Friends who know me quite well are, I am sure, convinced that I am not a robot, that I do not always support the Government and that I always give great depth of thought to any proposals brought before the House. So when I say to the right hon. Member for Mitcham that I wholeheartedly support the attitude being taken by the Government on this issue, he and those who support the Bill will appreciate that I take this view after having given the matter considerable consideration.
The debate so far has presented the House with a general picture of the problems facing pensioners. These are not specifically the same problems as those facing public service and Armed Forces pensioners. As a former officer of the National Council of Labour Colleges and a former T.U.C. education officer, I have taken part in many discussions on pensions and, in those discussions, the whole subject of pensions from the beginning of the century has been covered. Not least important in those discussions has been the problems thrown up during the period of Conservative rule and the proposals of the Labour Party to meet the problems faced by pensioners, particularly in their battle with inflation.
The enemy of the pensioner is inflation and most hon. Members have spoken on this issue. They have drawn attention to the fact that it is undignified for pensioners to mount a lobby to persuade Parliament that their problems should be considered. 952 For this reason the Government must not for too long delay their general overall plans to try to alleviate these problems.
One of my first Parliamentary Questions on becoming an hon. Member was designed to draw the Government's attention to the reduction in the value of pensions generally because of the rise in the cost of living since the Labour Party came to office in 1964. I agree that we made a pledge to rectify the position as soon as we possibly could, but inflation and rises in the cost of living are not peculiar to the Labour Administration. The cost of living has been rising for decades and this and inflation has plagued all Governments. Whatever harsh criticisms hon. Gentlemen opposite may have about the present Government's prices and incomes policy, they should at least acknowledge that it is an effort to beat the inflation bogy.
As we turn from the prices and wages freeze to the period of severe restraint, I shall not complain if prices and profits continue to be frozen while wages and pension values are allowed to rise. If it were possible to bring about that arrangement, I should put up two hands for it, but I am not allowed to go through the Lobby twice here, and so that would probably be a little difficult.
All the problems put forward in regard to public service and Armed Forces pensions are the problems of pensioners generally. So if we acknowledge that Parliament has to deal with its business item by item, then, as much as I sympathise with the claims of pensioners of this kind, I support the Government. Such pensioners I suppose, regard pensions as part of deferred salaries or wages for a pretty early retirement from the period of their lives which they spend in the various types of service.
An hon. Member opposite spoke about retirement at the age of 45. To talk about "retirement at 45" is a peculiar expression. What we mean is retirement from one kind of occupation preparatory to taking up another. However, I recognise and fully support the full sense of achieving a situation, when we can do so—it has not yet evolved in any kind of Administration—of keeping the values of all kinds of pensions moving in line not only with the cost of living increases but with the rate of productivity and, 953 therefore, the general national accumulated wealth that stems from greater productivity.
If these revolutionary ideas can be achieved, it will be a magnificent thing for everybody concerned, ourselves included. But that will not come about overnight, because of the enormous sweep of the change. I recollect that part of the Labour Party's pre-1964 ideas, when the movement was going through a period of rebuilding its programme, was the proposition that we should have a national superannuation plan which, in effect, would count in the two-thirds of the working population who are at the moment shut out of any decent pension consideration. The Government must, of course, address their minds very sharply to that.
Pensioners generally fall roughly into three categories. There are the better pension opportunity types such as ourselves, superannuated workers generally, the Armed Forces and the public service employees generally, in both contributory and non-contributory pension schemes and workers—as I was at one time—in the nationalised industries such as railways, mines and electricity and gas undertakings, the wages workers—not the salaried workers—who have an underprivileged pension scheme which will not give them the kind of pensions which will make it possible for them to look forward to leisure during the eventide of their lives, not at 45 but at 65, and, indeed, 70 in some cases, under the deferred retirement pension schemes. So it is a very sweeping and broad problem that we are dealing with.
There is a third category, the bulk of the workers—the factory workers and building trade workers. Let us take the building trade workers as an example. They change their employers very frequently, and, therefore, do not have an opportunity to contribute for any length of time to a decent worker-employer pension scheme, and so they have to look to the State and to Parliament to make eventual provision for some kind of decent build-up of what is, after all, deferred wages to be used in the later part of their lives in order to uphold their dignity and ensure that they do not have to rely on their children to keep the wolf from the door.
954 It is a little odd this morning to find members of the Conservative Party coming here in the guise of benevolence versus the Scrooge-like activities of the Labour Government. This is standing history on its head. History does not support this case. Although I acknowledge that the speeches that I have heard this morning have been put forward with full force and great sincerity on behalf of the limited number of pensioners involved in the Bill, I refuse to accept the logic of this situation. We on this side of the House, and particularly on the back benches, will fight like mad to ensure that the Labour Party upholds its pre-election promises by keeping the value of the pensions moving. That must come very early on the agenda.
§ Mr. David Winnick (Croydon, South)
Recognising all that has to be done, would not my hon. Friend agree that since the Government came into office millions of pensioners have been better off not because of general pensions increases but because of the social security minimum that we established last November?
§ Mr. Bidwell
Yes, I must freely acknowledge the great progress that has been made by the present Government in that regard, but I will not let them off the hook over their responsibility for keeping the value of the pensions moving.
If I may now address myself to the right hon. Member for Mitcham, there are many ways of killing a cat, or even of keeping it alive. What he is succeeding in doing this morning is keeping the matter alive. However, it is a matter of priorities, and the prime priority must necessarily be the old people who are in urgent need of consideration at present. That is the first priority. Much of what has been said will, of course, put the matter in its correct perspective for the future.
Addressing myself to the Bill, I find it very difficult to comprehend the general position of hon. Members opposite in wanting to add to the Civil Service. One of the things that have stuck in my mind since becoming a Member of Parliament is that hon. Members opposite are always moaning about the increases in the number of civil servants. I do not mind increases in the numbers of civil servants, provided that they remain 955 civil and give us good service—those should be the criteria—and provided that they are all doing a good job. I think that, by and large, they are no different from any other collection of workers. They are as human as any other collection of workers, and I think that they work as hard as any other collection of workers.
I bear in mind the remarks of the hon. Member for Orpington (Mr. Lubbock). The Bill does not contain the necessary provisions for what he wants to achieve. It may be argued that this is a matter that might be dealt with in Committee. I think that the general situation puts the Government in not a weak position but a relatively strong position in their wanting to put this proposition aside for the present but with the understanding that urgent attention must be paid to the general problem of the fall in pension values.
§ 1.29 p.m.
§ Mr. Maurice Macmillan (Farnham)
In all the arguments we have heard today I do not think anyone has suggested that the present situation with regard to public service and Armed Forces pensions is in any way satisfactory. Such arguments as have been adduced against the Bill have put the case that a machinery Measure such as this will not help, that it might even do some harm, and that in any case it is not the right machinery. It is to these points that I shall address my arguments.
The question whether this is the right machinery to deal with the problem could well be decided by letting the Bill have a Second Reading and discussing it in greater detail in Committee. It is clear. even from the arguments we have heard so far, that some improvement in the machinery for dealing with this problem is necessary and that this necessity stems from the fact that it is the Treasury's main responsibility to limit the Government's commitment in this and other matters so giving them what must in these circumstances be a conflict of interests.
If I make any critical remarks, I assure the Financial Secretary that they are in no way directed against him, or even 956 against his party, but will be criticisms of the Government machine and its way of operating towards these pensioners.
I want to start at the 1962 Act, the sixth since the war, which cost the taxpayer £22 million and which made about twice as big an increase as any previous such Act. With the 1959 Act, it more or less covered retrospectively the cost of living rise from 1956–62. It gave some favour to the over-70s. But it still left the purchasing power of the pension below its original level and it still did not deal with the problem of the time lag which is an inevitable part of this present system of dealing with pensions.
My right hon. Friend the Member for Mitcham (Mr. R. Carr) was correct in saying that those of us who are still earning have a dual responsibilty, both as citizens and as Members. This is a problem with which I am only too familiar in a melancholy fashion in my own constituency, where there are large numbers of Armed Forces and public service pensioners whose reward in retirement is an anxiety which their service abroad and at home entitled them to escape once they finished work.
It is our special responsibility to deal with the public service, since we in the House are supposed at any rate in some sense to control the Executive, which employs them in their working hours. One would like to extend this type of consideration much wider, but we are now dealing with public service pensioners, with the problems of their early retirement and with all the anomalies and other difficulties which have been mentioned.
I cannot but repeat the quotation which has already been made from the debate on the Second Reading of the 1962 Act:… the present ad hoc method of dealing with this problem is not satisfactory …". —[OFFICIAL REPORT, 9th November, 1962; Vol. 666, c. 1334–35.]We must get away from this constant two-year haggling over public service pension levels. It is just that which to me is the most important object of the Bill.
I do not think that the hon. Member for Orpington (Mr. Lubbock) was quite 957 fair to remind the Financial Secretary of the Labour Party's pre-1964 election pledges. Of course the Labour Government had to repudiate them. After all, this is only one of the innumerable cases in which desire has been forced to outrun performance. It is, perhaps, of slight melancholy satisfaction to some of us on this side who were critical of our own party in this respect to find that the Treasury has defeated the Labour Government, too, and that, despite all their vain hopes and aspirations, Treasury implacability has led the Labour Government into the present lack of action.
It must be accepted that the 1965 Act represented the best they could do in the circumstances. Like the previous Acts, it went some way towards meeting the rise in the cost of living but it did not provide any guard against inflation in any real sense of the word, and it certainly did not do anything at all towards giving a rising share of rising national prosperity to the pensioners. [Interruption.] If the hon. Member opposite had been paying attention, he would have learned that I made a very similar criticism of the 1959 and 1962 Acts. I would say to the hon. Member for Chislehurst (Mr. Macdonald) that the longer one remains here and the more one deals particularly with this type of matter, in which the Treasury has such an important part to play, the more one realises the truth of the ancient saying that the best is frequently the enemy of the good. We would all like to do more. We on this side recognise the sincerity with which some hon. Members opposite argue, "If we do this now, it might inhibit our capacity to do more later". However, that is an unwise argument because all the evidence of the past years is to the effect that it will not happen anyway.
One of the reasons why past Acts have never been fully satisfactory is that they have had to be limited to what is immediately possible; that this limited practice inescapably becomes part of the principle and a precedent for those who in the Treasury are considering the problem. The main target, the ultimate object, of the whole operation tends to be lost sight of in seeking, quite honourably and reasonably, to do the best that is possible in the circumstances.
What we believe that the Commission could provide is a method of keeping 958 before the public, before Parliament and before the Government, the object of pensions policy, which is, after all, agreed on both sides of the House. So it becomes a practical problem of how rapidly in the circumstances of the day it can be implemented.
The proposed Commission would do two things. It would be able to consider the problem and receive representations in a way which would do away with this constant political lobbying. It could set a series of ideals and suggestions which could be considered fairly by the Government of the day and by Parliament and be known to the people as a whole. The Commission would not in any sense seek to limit the Government's capacity to make decisions, for of course the Treasury and the Government must still be in control, and must decide what can he done in any given set of circumstances according to what is practicable. However, let us have at least the priorities known in public and let it be known in public what the Government of the day have decided and what relative importance they attach to the different demands which are set before them.
Despite what has been said in the course of the debate, I fear that all the facts are not fully known in every case. It is not so much simply a question of how much mathematically a pension or any one set of pensions has lagged behind the rise in prices or the increase in wages. All the circumstances of the pensioners concerned matter, too; whether the impact is on the same people who are affected by the rising rate burden; what is the effect on them of the housing situation, of the movement into the South-East, and of the fact that many of them have had to return from abroad and come late into housing queues and other situations. There are many factors which could be considered and studied, and on which research could be done by the Commission. This might well be one of the not less important parts of its work.
I should like to say a few words about the anomalies. I do not wish to go over the many details that have already been given. However, it is important that there should be a separate body with powers to study and compare what we do and what is done elsewhere; and also to compare 959 what is being done for the different classes of pensioner. This is particularly important with regard to the overseas public servant.
I should like to quote from one letter among many which I have received:Since I began to receive my pension in 1963 the purchasing power of each £ of it has declined by about 2s. The Tanzania Government will certainly not be making up the lost 10 per cent., nor, as things are at present, will H.M.G. The pensioner is therefore completely at the mercy of inflation with no one to help him. I understand that the French and Belgian Governments have taken over responsibility for the payment of their colonial pensions, Britain alone adopting a position of inflexible parsimony.We all know the difficulties of these colonial pensioners. I am not now arguing that the Government should assume full responsibility for their payment. The complications are very great. But I suggest that the problems involved, and the impact of these problems—which is perhaps even more important—on different people and different groups of people in this country, are one of the many things to which the Commission could give impartial, expert, and prolonged consideration.
I cannot see why the Government should wish to oppose the Bill, or, at least, its Second Reading. There are difficulties and problems. The Treasury and the Government have a very great responsibility to the great body of taxpayers and ratepayers. But we are not seeking a wild expenditure of public money. We are seeking only a Second Reading for a small, limited, moderate, and, in my view, necessary Measure—a Second Reading which will give us a chance to discuss it in greater detail, and the Government an opportunity, perhaps, to see what they can do to help.
§ 1.43 p.m.
§ Mr. William Molloy (Ealing, North)
The House has listened with great interest to what the hon. Member for Farnham (Mr. Maurice Macmillan) had to say, and I agree with quite a lot of what he said. I find it regrettable, however, that the Bill has such a tiny, narrow concept. After all, the subject under discussion is probably one of the most tender and poignant matters which the House can discuss at any time. The prob- 960 lem has been with us for many years. It might sound a paradox to say that the whole idea of pensions for ordinary people has never been an issue which goes back deep into history. It is a comparatively new idea, as is the idea of democracy itself.
Irrespective of which party has been in power at any given time, we, as a country, have always tended to push into the background the problems of old people, whether it be about their pensions, their housing, their illnesses, and so on.
What is equally remarkable—and I say this quite sincerely—is that back benchers on both sides of the House are always prepared—and it is right that they should be—to try to introduce Measures which they know full well their party were not prepared to contemplate when they were in government. Therefore, they try to introduce them when another party has taken over. That is right and proper. I am not criticising this in any respect, or saying that people try to make party political capital out of it. I do not think that is done.
I welcome the endeavour behind the Bill, because it gives the House an opportunity to consider, as often as possible, the whole field of pensions, and the problems that are associated with it. Unless the Government really get down to the quintessentials and the real problems which affect the whole wide field of pensions, then the morass in which we have been for the past 40 years in regard to pensions will become more strangling than it is now.
As a nation, we have never given any serious consideration—other than perhaps in party political pamphlets, no matter which party it is—to what the Government intend to do and what they would like to do. Having traced the history of this problem, it seems that all Governments, when in opposition, have quite sincere and remarkable ideas on what should be done in the field of pensions, but when they become the Government there is some form of crisis or difficulty which pushes pensioners in general back that little bit.
In fairness I should say that I am not satisfied with what the Government have done. This is something which 961 hon. Members opposite should be prepared to acknowledge in regard to their own Government. But one of the first things this Government did in 1964 was to make a remarkable increase, not merely in pensions but in all the allied services which affect old people in this country. That was done immediately. I would have hoped that everyone would have applauded that, irrespective of their political flavour. Therefore, I found it somewhat repugnant when hon. Members opposite said at that time that the idea was wonderful. They said, "We approve of it, but we are not with you when it comes to finding the money to finance it."
That is supreme hypocrisy, and it is to be hoped that we shall have no more of that behaviour in the House of Commons. That is the sort of thing that really annoys people. I hope that that attitude will drop, because the problem ill become more severe.
What has been happening over the years—and it will continue in this way—is that the number of people who are not actually contributing to our economy is growing. That is to say that the number of people up to the age of 16 and 17—and I hope this may extend later to those aged 19 and 20—who are still learning and who are not actually contributing to our economy, will increase.
At the other end of the scale, the number of older people is increasing, and for a number of reasons. Life has become easier over the past few decades. People are living longer, and the probability is that the pension age will be reduced. I am all for this happening.
I do not consider that it is the responsibility of the nation merely to provide a money pension for somebody who reaches the age of 60 or 65. Our objective should be to see that the retirement age is such that people can still go on enjoying the pleasures of life. The State should provide these things. Many of us in the Labour Movement have been saying this time and time again.
I can remember how I used to listen to my grandfather and his brothers, who were coal miners. To them a couple of hours in the sunshine was worth more than a few hours underground at double rates. Very often people who were not acquainted with the industry could not 962 understand this. When we are talking about pensions, we should at all times consider that there are other aspects more important than the provision of £ s. d.
I say again that I applaud the right hon. Member for Mitcham (Mr. R. Carr) for introducing the Bill because of the opportunity it gives us to remind themselves of our responsibility to all pensioners, not merely pensioners of the public service and the Armed Forces. I have had experience as a former staff side officer in the Civil Service. I am sorry that the hon. Member for Orpington (Mr. Lubbock) is not here at the moment—I suppose he has to eat like everyone else—because I want to remind him that the first talk about pensions in the Civil Service does not come from the pensioners' associations It starts at the beginning of service. This is one of the reasons why the Civil Service unions, the Civil Service Clerical Association, the Institution of Professional Civil Servants and the First Division exist. Their negotiations are directed not only to conditions of actual service but to the level of pensions when their members retire. I wonder whether they would be prepared to hand over to what, after all, would be a Government-appointed body the right to determine all aspects of their members' pensions.
§ Mr. J. C. Jennings (Burton)
The hon. Gentleman is mixing up two different issues when he speaks at the same time of the conditions of employment of people still in service and the plight of pensioners already retired, many of whom retired long years ago. It is the pensions and conditions of life of people already retired that we are considering under the Bill, not the prime conditions of a pension scheme but the raising of current pensions to a level which will compensate or, perhaps, more than compensate existing pensioners for the rise in the cost of living in a modern society. The two issues are different.
§ Mr. Molloy
I understand that perfectly well, and I was coming to it. There are two questions here. There are the problems of people when they retire, and it is the responsibility of the pensioners' associations to try to make good the deterioration in conditions after a civil servant or member of the Armed Forces has retired. The point I am making is that this is not lost sight of by 963 the staff associations. For years they have tried to write into their service and retirement arrangements some form of guarantee which would prevent the situation which has arisen and, indeed, prevent the need for a Measure such as this. In short, the idea is by no means new.
§ Mr. Molloy
One of the complications in the Civil Service, just as in the Armed Forces, is that there are various grades, from clerical assistant, clerical officer, executive grade, right the way through to principals and so on. Conditions vary enormously. There are some senior civil servants who can receive more in pension in half a dozen years of retirement than a lower grade civil servant can earn in 20 years. This is a difficult situation. In relation to the contribution which a senior man makes in a high executive post, it is right and proper that a certain level of pension should be paid, but it is difficult to convince someone of this when he believes that he has made a valid contribution to his country as, say, a messenger or artificer in one of the industrial grades of the Civil Service. So the problem is even more complicated than some of the thoughts expressed this morning indicate.
One of the grave risks we run in talking in isolation of pensions in relation to particular contributions made to the nation is that we can be thought to imply, quite erroneously, that somehow or other miners, carpenters, engineers and technicians working in private industry are not serving the nation or the State. Of course they are. Some of them receive very good pensions, but some do not. We must look at the whole matter of pensions with a much wider view.
I quite understand that hon. Members opposite may find this a difficult argument to accept, but I remind them that within the. Civil Service and the Armed Forces there are gradations of responsibility, of job and of remuneration which are precisely similar to what is found in occupations in what I might describe as the non-State side of life. There should be no difficulty in bringing the two together to create the grand ideal about which Nye Bevan used to speak when he argued that it ought not to 964 be an insuperable problem for a modern industrial society to say to everyone, whether soldier, civil servant, collier or technician—no matter what—" You are a Briton and here is the pension which you will get at the end of your time ". It ought to be possible for us to do this without adding to the complexities of the present situation with all the various cards, stamps of different colours, different contributions, and so forth. We could do away with all these problems by going for the principle of comprehensiveness.
To a great extent, we can see this in the implementation of our National Health Service arrangements. We do not ask a person what his grade is, whether he is a civil servant or a soldier, or what his remuneration is. Yet the system works. This is the test. I hope that we can do something along the same lines for pensions when the Government make their proposals.
While I have considerable sympathy for the Bill and the ideals behind it, I hope that some of the points which I have made about complications within the Civil Service and the Armed Forces will be understood. These complications ought to be viewed in association with the complications in outside civil life, and the correct way for any Government to come to grips with the problem is not to diversify even more but to try to bring all together. My fear is that the system proposed under the Bill, which in its context is admirable, could be a little good which later on caused a great deal of harm.
This does not mean that the problem of civil servants who are retired now can be shelved. There ought to be an interim contribution from the Government to alleviate many of the difficulties which afflict people on pension now. But this of itself will not solve the future problem, which is what concerns me. The future problem includes everyone in the nation, not merely civil servants and members of the Armed Forces. I acknowledge that they make an important contribution to the nation, but treating them or any other group in isolation will store up even grimmer problems for the future.
Here is an analogy to show what I mean. One of the little good things which in the end has proved damaging, in my estimation, has been the form of 965 private pensions. For the people concerned it was a good thing, and very often it was an attraction to work in a particular industry or firm. I say in parenthesis here that the State, irrespective of the Government in power, has always been a first-class employer in this respect. Many of the pension schemes in private industry could learn a great deal from the State.
My message to the House and the Government is that we can go no further in making these tremendous diversifications in pensions. If we accept the principle of comprehensiveness throughout the whole range of our people, as we do in the National Health Service, then all these related problems of different grades in the Civil Service and in industry can be wiped out within a decade in the same way as we have moved very much towards this approach in the National Health Service. I hope that the Government will look at the National Health Service to see how many of these principles can be applied to the whole of pensions arrangements.
§ 2.1 p.m.
§ Sir John Eden (Bournemouth, West)
Like other hon. Members who have spoken, my first words are to congratulate my right hon. Friend the Member for Mitcham (Mr. R. Carr) not only on the choice of the Bill which he has presented to the House but also, as has most fairly been said from all sides of the House, on the manner in which he presented it. All hon. Members on this side of the House wish the Bill every sucess. I very much hope that the Financial Secretary to the Treasury, who is to speak for the Government, will recognise the strength of feeling on these benches and at the very least will enable the Bill to go to Committee where the matter can be further discussed.
The last few speeches by some hon. Members opposite have in some way sought to broaden the debate, or at any rate to introduce matters not wholly relevant to the Bill. May I remind them that the Bill is entitled the Public Service and Armed Forces Pensions Commission Bill. In other words, it is concerned with the pensions of the forces, serving officers on retired pay, civil servants, local government officers, teachers, the police, firemen, those who are employed in the National Health Service and overseas service pensioners to the extent that the United 966 Kingdom Government are responsible for their pensions. The Bill goes no further than that. I do not think it wrong to attempt some form of modest improvement in our legislation or the methods by which we could help these people in their retirement even though at the same time we are unable to cover the whole range of pensions. I am sure that on reflection hon. Members opposite will agree with that.
Apart from those present and those who are concerned with these matters, I am very much aware of the many thousands of people outside the House who are anxiously awaiting the outcome of this debate. For them this is not merely a matter of form, not merely a matter of determining some fresh Government machinery. It is not a piece of lifeless mechanics. To them it represents the essentials of their life in their old age.
Some hon. Members have hesitated to quote from letters which they have received, and I well understand that hesitation, because all of us must have received letters in great abundance. But it does no harm to single out one or two instances in order to paint the picture in human terms, so that all of us are reminded, as the moment of decision approaches, what we are considering. I will quote this morning from only three letters. The first is from a retired soldier who was compulsorily retired at a comparatively early age. He writes:I am now 49 and unemployed, though not for want of trying to obtain employment. I cannot expect to benefit from the Pension (Increase) Acts until my sixtieth birthday in May, 1978. I am up to my neck in mortgage and my savings are exhausted.I will next quote from a letter from the widow of a Government servant who provided valuable service in some of our territories overseas. She is in receipt of a small widow's pension. In her letter to me she writes:With the cost of living rocketing up almost every day and with no other income except the pension, it is almost impossible to keep out of debt. Sheer necessities and no luxuries are in my weekly budget, and I am almost afraid to go into the shops for fear of being told that something else has gone up in price.The third extract which I quote—and I will deliberately not give too many details, because I am sure that hon. Members understand that I do not wish to 967 identify the persons concerned—is from the widow of an extremely distinguished servant of this country who was honoured, quite properly, for the work that he did in some of our overseas territories. She writes.I am 86 years old this month, and my widow's pensions come to £10 19s. monthly. I have been in such difficulties that a year ago I was obliged to ask for public assistance.Such instances are not peculiar by any means to me, for I am sure that every hon. Member could produce examples in abundance. All I say about them is that it is a disgrace to us all that we should be treating our public servants and their widows in this way.
I know that a point has been made about the action of past Governments. I am not pillorying the present Government because they happen to be in power at the moment. All Governments have resisted over a long time pressure from all sides of the House to improve the machinery by which we deal with our public servants in their retirement in order to avoid circumstances arising such as those which I have had to describe to the House.
The hon. Member for Walthamstow, East (Mr. W. O. J. Robinson), who made an extremely interesting contribution, seemed to me to put somewhat touching faith in the power of hon. Members to harry the Government to good purpose. As so many of my hon. Friends have already said, it is through and beyond the Government that we are seeking to get at the moment. It is to those who have constituted the machinery by which the decisions are taken that we wish to penetrate, and it is extremely difficult for hon. Members to achieve this, no matter how strongly they may feel on the subject at the time.
I particularly favour the Bill because it would end the necessity for hon. Members to harry the Government to such an extent. It would end the necessity for persistent lobbying by the organisations representing the pensioners and by the pensioners themselves. That is not to say that this would take from the Government their freedom of action and their freedom to decide whether or not to heed the advice and recommendations of 968 the Commission when it reports. There would still be opportunities given to hon. Members of this House to press the Government, but they would then be pressing the Government, not on evidence brought to them in multifarious examples from their constituencies and elsewhere, but on evidence brought publicly to the notice of the nation as a whole as a result of the careful scrutiny undertaken by the independent Commission.
The value of this Commission would be that it would provide a yardstick by which to judge the manner in which the Government of the day discharge their responsibilities to the public servants of this country. It would provide this House, and, indeed, the country as a whole, with an independent and informed basis and criterion from which to assess the needs of our public servants and their widows. It would, better than any other way, bring out the true nature of the problems with which these people have to deal, and the many anomalies in the existing pension arrangements.
One final point I wish to make, in considering the position, in particular, of widows, or of those who have married after retirement, or of those who marry again, a second time, and subsequently are bereaved, is that these pensions have been earned during the serving life of the man or woman concerned. What we are dealing with here is a form of deferred pay; it is part of the conditions of the service and employment of these people to have regard to the payment they shall receive at the end of their working life. I am quite certain that when they entered service the contract into which they entered had the intention of providing them in their retirement with a realistic amount of money which would pay for their essential needs and requirements in their retirement.
So we must seek some reasonable, foolproof way of meeting the consequential effects of inflation. Parity has been suggested; it has been talked about by a number of hon. Members. I agree that we cannot expect parity at the moment, but we could go some way towards it; we could bring all the oldest pensioners, those on the oldest codes, up to the 1956 code, and we could certainly set about removing some of the many anomalies existing at the present time.
969 Though the Commission would not of itself exempt the Government from their responsibility and from their right to take the final decision in this matter, it would, I believe, provide us with the machinery through which we could make a start on bringing order, justice and equity into our treatment of those who have retired from the nation's service.
§ 2.14 p.m.
§ Mr. Edwin Brooks (Bebington)
The hon. Member for Bournemouth, West (Sir J. Eden) has spoken with great passion about a subject on which all of us are moved sometimes to passion, sometimes to anger at the anomalies and injustices which surround this immensely difficult problem of pensions in our modern society.
I must join my hon. Friend the Member for Southall (Mr. Bidwell) in apologising to the House for having missed some of the earlier speeches, including the speech by the right hon. Member for Mitcham (Mr. R. Carr) when he introduced his Bill, a speech to which many subsequent speakers have paid testimony, for its documentation and for the skill of its presentation. However, I have heard with interest many of the speeches which have been made subsequently on both sides of the House, including the speech made from neither side, I suppose, but from that strange political purgatory where 12 Liberal apostles dwell, and made by my hon. Friend the Member for Orpington (Mr. Lubbock)—[HON. MEMBERS: "Friend?"]—from neither side; I am being generous this afternoon.
The points to which I should like to refer are several. I should in particular like to focus on the Bill itself. I feel that on occasions we have strayed somewhat from the specific provisions of the Bill, and while it is inevitable that to some extent one must do this, I feel that there are some ambiguities within the Bill which should be clarified. While I do not wish at this stage to subject the Bill to the type of detailed criticism which is more properly reserved for Committee, I feel that some of those ambiguities stem from the very nature of the Bill itself, and underly its essential principles.
The Bill, as the hon. Member for Bournemouth, West pointed out, relates to the public service and the Armed 970 Forces. He drew attention to the fact that many of the speeches seemed to stray from this particular context. I suggest that that was perhaps inevitable, because of the way the Bill is drafted. It is true that the Bill sets out to establish a Commission, which has defined terms of reference, but when one looks at the definition of those terms of reference, particularly Clauses 2 and 3, one sees that they are, I think, in such wide terms that it is very difficult indeed to say what are the criteria upon which the Commission would make recommendations.
In Clause 2(2) we see that the Commission shall report every two years orat intervals of not more than two yearsand make recommendations. There is nothing at all in the Clause, as I read it, which specifies on what basis those recommendations shall be made. Any hon. or right hon. Gentleman in this House can at this moment make recommendations to the Chancellor of the Exchequer. A recommendation could be—although I think there is no doubt that it would be most unlikely—for a cut in pensions. This would be such a monstrous and outrageous recommendation that we would not consider it for one moment, but it is quite obvious that unless one does define fairly clearly what are to be the criteria on which the Commission shall make recommendations, the statement in itself is inherently ambiguous.
Looking further down that same subsection we see what may perhaps be argued to be some measure of qualification of what the recommendations should be, that the recommendations shall take accountof any matter relative to the purchasing power of such pensions and benefits"—That, I think, is fairly straightforward; but then the next point is far less straight-forward, that they should take accountof any matter relative to the … national economic situation.This surely extends the terms of reference and the Commission's functions to quite extraordinary limits. The national economic situation would almost certainly have to take into account not only the gross national product but the determination of priorities in the allocation of the gross national product not only between 971 pensions—say, between the Armed Forces and the other public services and in other parts of the community—but also between pensions and all the other various commitments of the Government, including, no doubt, overseas expenditure, which, clearly, is expenditure not without relevance for the social services.
Therefore, the Commission is almost bound to produce bulky reports, no doubt of great weight, but, as we have learned to our cost from many of the reports of Royal Commissions of equal weight and bulk, this is not necessarily a good thing if one wants immediate and effective action.
The final words of the subsection are to the effect that any other relevant consideration may also be taken into account in making recommendations to the Chancellor. It is fair to ask, relevant to what? Is it relevant to the purchasing power of such pensions or, presumably, to something much wider and even mote ill-defined?
As I said earlier, I would not want to quarrel with particular points of drafting or phraseology just for the sake of it in a Bill of such importance, in terms of the problems that it is seeking honourably to overcome, were it not for the fact that I suggest that the ambiguities about the terms of reference of the Commission make its powers and functions highly problematical and dubious.
In Clause 3, there are certain risks arising out of the rather vague and unspecified powers which the Commission would seem to have given to it under the terms of the Bill. It says that the Commission may, after consultation with the Chancellor of the Exchequer, take certain action which I shall discuss in a moment. What form will that consultation taken I assume that it will be consultation in private; it will be consultation, doubtless, dealing with those poignant and personal problems to which the hon. Gentleman referred a moment ago and to which all of us are given access almost daily in our postbags. Clearly, it would be improper for this sort of consultation to take place in the full light of day, in public. It would have to be confidential. What would happen if the Chancellor of the Exchequer decided after consultation that the inquiry into particular provisions 972 of the statutes, etc., should not take place? Would the Commission then be able to disclose that the Chancellor had refused, if indeed he has powers under the Bill to refuse, any further inquiry?
The Clause goes on to point out that the Commission may then make such recommendations for the revision of the various matters which it is discussing, as it thinks fit. Again, I should have thought that that begs the questions which arise out of the same phraseology in Clause 2(2).
To make recommendations for their revision here might involve more difficult problems still. Recommendations affecting the generality enable justice to be seen to be done. Immediately one starts to make recommendations affecting individuals, where, by the very nature of the inquiry being conducted, it may be impossible to disclose all the circumstances, it becomes increasingly difficult and perhaps inherently impossible to ensure that justice is seen to be done.
In Britain today, pensions are already so complicated that all of us must be tempted at times to wish that we could go back to square one and start all over again. Almost daily, we get letters which argue that on the basis of this or that precedent, some anomaly has arisen in relation to a particular individual. There are so many precedents which can be argued, sometimes contrary to one another, that at times it is difficult to indicate to someone, even having written to the Minister concerned, that justice is being done in the case under dispute.
§ Sir J. Eden
The House is extremely interested in what the hon. Gentleman is saying and in the manner in which he is examining the Bill. But surely the whole effect of his speech, at any rate for those of us on this side of the House, is to indicate how important and desirable it is that the Bill should go to Committee, where these points of detail to which he is now referring on Second Reading can be properly examined.
§ Mr. Brooks
I appreciate the hon. Gentleman's point. I said at the outset that I felt that the ambiguities which I am trying to indicate perhaps go to the heart of the Bill. If the hon. Gentleman will bear with me for a moment or two longer, I will try and indicate why I 973 feel that this is not, in principle, the best way to tackle the very real problem which is under review.
I do not wish to dwell any more upon the problem of anomalies. I should have thought that, in the event of Clause 3 being implemented, we are likely to find numerous new anomalies emerging and new precedents being defined in such circumstances that very often the basis for them is unclear to all concerned.
It was said by an hon. Gentleman opposite that we are not arguing about an institution or procedure. But, with great respect, that is precisely what we are doing. We are arguing about a form of procedure whereby problems can be elucidated. The hon. Member for Farnham (Mr. Maurice Macmillan) quoted to one of my hon. Friends the aphorism that the best is often the enemy of the good. One does not want to exchange such pleasantries in the course of this debate, but I am tempted to remind the hon. Gentleman of the proverb that too many cooks spoil the broth. In a matter of this sort, there is a danger of trying to bring in too many bodies of experts whose terms of reference are ill-defined and whose powers seem to be immense.
In the concluding speech of my hon. and learned Friend the Financial Secretary, I am sure that the Government will make it clear that the action proposed in the Bill should be seen in the light of the wider review which has been under consideration far many moons. I join with my hon. Friends in asking the Government not to delay very much longer on this one. We have lived with this fundamental review for a long time now, and there is a danger that it could become an excuse for inaction. It is a danger which will not be revealed in practice. I am sure.
Having made the point about delay, I am sure that the time is now ripe for this review to be published. I agree entirely that it is the right way of going about it. The fundamental review is long over-due, but it has been overdue for many years. In the course of those years, we have been tinkering about all too often with a problem which has to be looked at in a wider context.
On Monday, I had a Question down to my right hon. Friend the Minister of 974 Social Security in which I sought to clarify the problem of retirement. It is quite obvious that with advances in medical science, with the possibly revolutionary developments which are on the near horizon in arresting the ageing process, the problem of retirement will have to be looked at in a new context within the next decade and possibly even earlier.
Not only is there the problem of a possible review of the age of retirement, but also the growing certainty, which to some extent the Bill misses, that, with increasing sophistication and technological advance in our economy, it will become more customary for people to change jobs in the course of their working lives.
There is no assumption that in the years to come people who commence their careers in the public service will terminate them there. It seems to me that it will be all to the good if there is much greater interchangeability between the public service and other sectors of the economy. Nothing but good could come from this, and we should encourage it. We should encourage much greater mobility between the professions and the various trades in our society. If this is true, and I suspect it is, it surely means that the problem of pensions for the Armed Services and the public sector of the economy should not in principle be divorced from the problem of pensions as a whole.
It is on those grounds, and particularly on the arguments which have been advanced at length by some of the earlier speakers, especially from this side of the House, that I feel that there is here a very real problem. I think that the House should be grateful to the right hon. Gentleman for having introduced this Bill, but I feel that we should wait until the fundamental review is available, and I urge the Government to make it available in the shortest possible time.
§ 2.31 p.m.
§ Mrs. Margaret Thatcher (Finchley)
I should like to intervene for a few moments to make some comments on the Bill.
First, I congratulate my right hon. Friend the Member for Mitcham (Mr. R. Carr) on his choice of subject. Secondly, I congratulate him even more warmly on the way in which he introduced it. His 975 speech was a model for many Ministers when introducing big Bills from that Dispatch Box, and I hope that it will be very widely read.
I wish that the hon. Member for Bebington (Mr. Brooks) had deployed his analytical capabilities when we were discussing the Selective Employment Payments Bill, because if he had, it would never have passed into law, and he would have prevented many of his hon. Friends from voting for it. I think that the hon. Gentleman and many of his hon. Friends have struggled hard to adduce arguments against the Bill, and in the end they all fell back on the characteristic argument, "Please, we want something much more than this, and therefore we do not think that we will vote for it." I always think than this, and therefore we do not think far better to take something small if it is within one's grasp, rather than hold back for something which one may never get.
As the hon. Member for Walthamstow, East (Mr. W. O. J. Robinson) said, in all the Pensions (Increase) Acts since the war there have been a considerable number of improvements, not only in rates, but in the way in which the increases have been given. We have not always given increases on the same basis. There have been successive improvements, and my point in raising this is that it would now be a logical and reasonable step to have a different arrangement for pension increases, and this new step which the Bill puts forward follows the previous Acts.
In 1947 and 1952 increases were given only to those with the smallest pensions, on acute hardship grounds. By 1956 the concept of relative hardship was recognised, and much greater increases were given right up the scale. In 1959 the upper limit on increases was further raised, and the increase did not depend entirely on hardship, but more on the right to retain the purchasing value of the pension, and possibly to get some small increase over that. In 1962 we had a new principle. There was a bonus for the over 70s. In 1965 we had what was described by the Government spokesman as a holding operation. Thus, until 1965 we had been embodying new principles all the time, and there is therefore nothing different about having a new principle for determining public service pensions.
976 The Chief Secretary introduced the 1965 Measure and said:This Bill, however, is essentially a holding Measure awaiting the outcome of the fundamental review of social security."—[OFFICIAL REPORT, 18th November, 1965 Vol. 720. cc. 1353–54.]We have not had the outcome of the fundamental review of social security. Indeed, its chief architect has now left the Government, and very sad and sorry we are that the Prime Minister thought fit to have the right hon. Member for Sowerby (Mr. Houghton) leave the Government, because I believe that he knew more about pensions and Inland Revenue matters together than anyone else in the Government, and as much as anyone else in the House.
It seems unlikely that we shall get very much if we wait for this fundamental review. Indeed, I do not think that it will ever produce very much by way of constructive help in this matter. For a start, I believe that it was meant more for National Insurance funds and matters of that kind than for basic occupational pension schemes in the public service, which is what we are talking about today.
A number of hon. Gentlemen opposite have thrown at my hon. Friends the fact that there was a certain reluctance to accept the principle of the Commission when they were in power, and have quoted the speeches of the then Financial Secretary, now my right hon. Friend the Member for Altrincham and Sale (Mr. Barber), in support of their contention.
May I examine my right hon. Friend's two main arguments, which have also been advanced today. First, that if we have this system we will get a certain rigidity in the reviewing of public service pensions, the implication being that if that rigidity is not there, these pensioners will get their increases more quickly. Because of experience, I reject that argument altogether. Surely we can look to the experience of the last few years. There has not been a faster review without a Commission. Indeed, it has probably been slower. I know that Government spokesmen who reply from the Dispatch Box often have to use any argument that they can lay their hands on. I think that this was just such an argument and I give my hon. Friends the firm assurance that after the next election 977 I shall not when I reply from the Dispatch Box use a similar argument.
The second argument which was used on the occasion to which I referred was that one must have regard to those taxpayers who are living on modest incomes when considering increases in public service pensions. On any matter of public expenditure one always has to have regard to taxpayers living on the smallest incomes, but such a defence would come ill from the present Government because their policy is to put up public expenditure and it will be very sad and sorry if, during a period when they have planned increases in public expenditure, some of the public service pensioners cannot get some of this increase. If they cannot get some, then they never will.
I do not accept the two favourite arguments which are likely to be put up against the Bill. I accept them the less so because, as the Financial Secretary knows, during the last Budget he and his Government refused to increase the age relief which would have reduced the taxes on many of these people whom we are trying to help today.
There would be some analogy with National Insurance if the Financial Secretary and hon. Gentlemen opposite were to feel able to give the Bill a Second Reading today. After all, National Insurance pensions have an advisory committee, the National Insurance Advisory Committee to which points are often referred. It often has referred to it special anomalies or points of principle. The Committee reports to the Minister and he, as in this Bill, can either accept or reject its recommendation. The power of decision must remain with the Government, and the Bill recognises this. This does not prevent the National Insurance Advisory Committee from making some very valuable contributions, and I believe that there is a more careful and objective study of the anomalies of the system because of the existence of this Committee than there would be without it.
There is also an Industrial Insurance Advisory Committee and a War Pensions Advisory Committee from which recommendations are translated in the form of Royal Warrants. There is nothing 978 new about having some independent body of distinguished and impartial people such as the Bill recommends.
I hope that the Financial Secretary will advise some of his hon. Friends to allow the Bill to go to Second Reading. He will counter my argument by saying that the National Insurance Advisory Committee cannot study rates of pension. I accept that, but I share the views of a number of my hon. Friends that one of the things the Commission should most earnestly consider is the many anomalies which give rise to so much grievance throughout the public service pension sector. If it made a systematic study of that problem, it would do a very great service, particularly if it studied the conditions and pensions under which the widow must live. That would be a service not only for the widows but for the men who serve, because I believe that every man should be able to make, and be sure that he can make, proper provision for his widow.
We are concerned mainly with the older pensioners, those who are already retired, who are hit badly in two ways, first because their pensions are very small, and secondly, because the value of their savings has dwindled tremendously. They often saved in gilt-edged, sometimes War Loan and sometimes 2½ percent. Consols. They were often very frugal, and sometimes saved a far higher proportion of their income than people today who have very much higher wages.
I echo some of the points made by my hon. Friends about parity. The proposals of the Conservative Party in our manifesto at the last General Election, which we now repeat, were very modest; that is in keeping with our whole attitude towards election promises. The proposal in the Bill was one of them. Hon. Members opposite had election proposals which conveyed the impression that they had accepted the principle of parity. People said at my election meetings, "The Labour Party has accepted that principle. Will you now accept it on behalf of the Conservative Party?" I had to say, "No."
Because that impression was conveyed, public service pensioners' hopes were raised very considerably. I think that they were raised falsely, and one of the worst things that can be done is to raise 979 hopes falsely, particularly at election time. But they were raised, and I believe that those pensioners are now entitled to expect something from the Government. We know that what they want at the moment is the Commission which the Bill would provide. Many of them will have very heavy hearts tonight if the Bill is not given a Second Reading.
My final point to hon. Members who appear to be thinking of voting against the Second Reading is that we ourselves have done very well by referring our pay and similar matters to an independent Commission. We did very well out of the taxpayers' purse. It ill becomes us to refuse this small Measure which could give hope to so many.
§ 2.44 p.m.
§ The Financial Secretary to the Treasury (Mr. Niall MacDermot)
I join with the hon. Member for Finchley (Mrs. Thatcher) in paying the warmest tribute to the way in which the right hon. Member for Mitcham (Mr. R. Carr) introduced the Bill. It was a model for a speech of its kind.
But he was a little optimistic when he said that he thought that he had chosen a subject which had a chance of being accepted. As he well knows, and as hon. Members have been reminded, the proposal in the Bill is virtually the same as one moved by the Liberal Party in an Amendment to the 1962 Pensions (Increase) Bill, a proposal which was rejected by both the then Government and the then Opposition. My right hon. Friend the Member for Sowerby (Mr. Houghton) was the spokesman for the Opposition then, and having more immediate prospects of being a member of the Government than members on the Front Bench opposite have today—with the full weight of that responsibility on him—he had to advise the House not to accept the proposal, although he showed great sympathy with the problem the Amendment was intended to meet.
As the right hon. Member for Mitcham made clear, he approached me before introducing the Bill and inquired whether the Government could support it, so that it could be put forward with all-party support. I had to tell him that we could not support it, and as this is a matter in which traditionally we try to avoid party controversy, I thought it only fair to 980 write to him giving a reasoned reply. I am grateful to him for not reading it, for that would have made my speech today sound rather repetitious.
I do not seek to contend that there is no room for improvement in the present system of dealing with public service pensions. Speeches today have shown that there is general agreement that there is. But I do not believe that a Commission of the kind suggested would be a satisfactory solution.
Let us consider what it is proposed that the Commission should do, first in relation to pension increases and then the various superannuation schemes. The Commission would be charged with instituting a regular process of submitting recommendations at intervals of not more than two years on the general level of all the pensions in question and then making a report to the Government, who would be required to lay it before the House within one month.
A number of hon. Members who have spoken in support of the Bill stressed that the proposed Commission would be advisory only, and that the Government's freedom of decision would be unimpaired. I hope that I am not doing hon. Members an injustice if I say that I take that argument with a small pinch of salt. Surely they at least hope that the Government would in practice find it very difficult to reject the Commission's recommendations? And unless the Government gave an undertaking in advance that they would accept the Commission's recommendations on either the timing or amount of pension increases, I am not clear what the proposal would achieve.
One of the chief arguments for the Bill which has been repeatedly put forward today is the "hand-to-mouth" argument to borrow a phrase used by the right hon. and learned Member for Chertsey (Sir L. Heald), that the pensioners are always trying to catch up from the back of the queue, and that repeated agitation and discussion by Members of Parliament and outside bodies are needed before any further legislation takes place. As another hon. Member opposite put it, we want to get away from the two-year public haggling. How would the proposed Commission eliminate that agitation? As some of my hon. Friends have pointed out, all it would do would be to add 981 another stage to the argument, another weapon to the armoury of those who are agitating for the change.
Perhaps I cannot deal with the argument better than by quoting what was said by the right hon. Member for Kingston-upon-Thames (Mr. Boyd-Carpenter) when speaking as Chief Secretary at the time the similar proposal was discussed before. He said:… this proposal would not obviate that in any degree whatever. All that it would do would be to put, as it were, another link—the five more-or-less wise men of the Pensions Board—into the chain. It would still no doubt he the wish and desire of outside bodies, as in a free society they are entitled to do, to approach hon. Members. It would still be the view of hon. Members who felt strongly about this that they should indulge in the traditional and proper activity of harrying Ministers, and it still would be necessary for Ministers, when convinced of the desirability of the move, to produce legislation, whether precisely on the lines of this Bill or not. Therefore, whatever may be the merits … of the hon. Gentleman's proposal, it does not begin to meet the general point to which he referred…".—[OFFICIAL REPORT, 20th November. 1962; Vol. 667, c. 1158–59.]It was slightly naïve of me, as I appear to have done—and have been quoted as doing on a previous occasion—to say that these people have no one to argue for them. They have about 630 very strenuous representatives who repeatedly argue on their behalf and there are some extremely effective shop stewards, most of whom I see in their places today, who are constantly taking up their cause.
At the time of the previous debate, about 75 hon. Members voted against the proposal. They were all members of the party opposite. The hon. Member for Tiverton (Mr. Maxwell-Hyslop) asked rather aggressively when this had been rejected. I would invite him to look at the debate from which I have just quoted, at column 1170, where he will find his own name among those who voted against this proposal. Members of our party were a little more consistent in their attitude, because I think only one hon. Member, who is now a member of the Government, voted in support of the proposal.
I believe that it is argued that periodic reviews by a Commission of this kind are needed to keep up the pressure on the Government and to ensure that they keep this problem in the forefront of their minds. I can assure hon. Members 982 that the constant review of the public service pensions is a reality. I was somewhat sceptical—as I often am when assured that a matter is constantly under review—but when I came into my present office and assumed responsibility for these matters, I discovered how much of a reality that review was.
I can assure the House that, at the time leading up to the last Pensions (Increase) Bill, we in the Treasury were always several steps ahead of the agitation. The decision had effectively been taken within the Government to introduce another Pensions (Increase) Bill before any substantial agitation had got under way in Parliament in favour of it. I therefore assure hon. Members that there is reality in the assurance which has been given many times before.
I am sure that the House will understand why no Government could bind themselves automatically to accept the recommendations of a body of this kind——
§ Mr. R. Carr
Before the hon. and learned Gentleman leaves that point, even if we accept that this review is constantly going on in the Treasury can he deal with the point about the need for justice to be seen to be done, so that, at any given moment, we know the results of the review and can compare them with what the Government of the day are able to do? We are realistic enough to realise that these two cannot always match up with each other, but if there is to be a sense of fairness, this should be in the open.
§ Mr. MacDermot
Justice is seen to be done when proposals are brought forward by the Government, as they were on the occasion to which I referred. I will come to the detailed measures in a moment.
As I was saying, the Government recognise, of course, their responsibility as employers to ensure fair treatment for public service and Armed Forces pensioners, but this is a responsibility which the Government must shoulder themselves. It cannot be shuffled off on to some other specially created body.
I now turn to the argument that the Commission is needed as a fact-finding body. First, when dealing with increases, it is not difficult to keep track of the 983 purchasing power of public service pensions, nor to assess the extent to which they may at any particular time have fallen behind the increase in the cost of living, or—if that is thought to be a more appropriate criterion—the increase in earnings. This part of the exercise is largely statistical and presents no great problem.
The right hon. Gentleman asked why, if we need a permanent machinery for a pay review in the public sector, we do not also need permanent machinery for pensions review. Of course, the two are entirely different. Public service pay is based on the doctrine of comparability, fair comparisons, and what is needed here, in different sectors of pay, is a machinery for examining and establishing movements in the outside pay to which comparison is being made. For that, we need a permanent machinery.
However, if it is a matter of watching the extent to which a given level of pensions has been eroded by cost of living increases, there is no need to set up some elaborate and special machinery. This is something which is well recognised: hon. Members put down Questions about it and it is closely followed by the Government and by hon. Members all the time.
What is more difficult is to assess when the situation has reached a point at which action to compensate public service pensioners for these changes should be given the necessary priority over other claims on limited national resources. If the long-term interests of pensioners are to be served, their demands must be judged against all the other conflicting claims for improved living standards and for losses suffered by inflation to be made good. The alternative is a free-for-all, from which the pensioners, with or without the Commission, would have nothing to gain.
A body constituted to review the level of pensions and other aspects of pensions provisions would not be well equipped to weigh the claims of other members of the community—this was the point made by my hon. Friend the Member for Southall (Mr. Bidwell)—for example, the claims of lowly-paid workers or those where there is an acute manpower shortage. If the Government need advice in 984 this respect, they could more properly turn to the Prices and Incomes Board. Although it is tempting to put pensions and pensioners into a special category, we should not forget that pensions are a form of income no less than salaries and wages.
The last Pensions (Increase) Act, in 1965, cost, in total, about £25 million a year and any other Measure of the same traditional pattern could well cost even more, since the number of pensioners goes up all the time and the pensions themselves are becoming progressively larger, as the terminal salaries on which they are based go up as a result of pay increases. I do not see how the Government could justify putting the initiative for proposals involving this order of costs into the hands of an independent Commission, even to the extent proposed in the Bill, and in this respect the proposed Commission cannot possibly be compared with bodies such as the National Insurance Advisory Committee. It is not, however, simply a question of cost but rather a question of a combination of cost and priorities.
There is sometimes a tendency to speak of public service pensioners as though they were singled out for specially harsh treatment. I do not for a moment underestimate the problems of the pensioner. I see a great deal of them in correspondence with hon. Members and with pensioners, as do other hon. Members. But the fact remains that the provisions of the public sector pension scheme are not in themselves by any means ungenerous, either as regards basic pension benefits or as regards pension increases. At the time of the 1965 Act, which came into effect 13 months ago, the cumulative effect of that and previous Pensions (Increase) Acts was in the majority of cases to increase the total pension income, including the National Insurance pension, of those who benefited by more than the increase in the cost of living since their retirement.
This is a fact which is sometimes forgotten, and it shows that the substantial majority of public service pensioners are sharing in the increase in prosperity after the time of their retirement. I do not think that this can be regarded as ungenerous. As we have been reminded by one or two of my hon. Friends, we should also remember that 40 per cent. 985 of all pensioners in private pension schemes have no arrangements at all for the augmentation of pensions, whereas in the public sector nearly all pensioners are or in due course will be eligible for pension increases. There are also many people in the private sector who receive no occupational pension at all.
§ Mr. Costain
Is the hon. and learned Gentleman aware that in the private sector annuities are generally bought and that the high rates of interest at the moment help with higher pensions?
§ Mr. MacDermot
That may apply in some cases, but I was pointing out that in many cases in the private sector there is no provision at all for increases. I do not want to make too much of this point, but it is a point which should be made because of the emphasis in some of the speeches.
So far I have commented only on the proposal that the Commission should operate in the field of pension increases. It seems to me that the same arguments apply to the suggestion that it should interest itself also in questions arising from the structure and administration of the pension scheme. In my experience, there are two quite separate classes of proposal which arise for amending or reforming the pension structure. At one extreme, there are the highly technical and usually uncontroversial amendments which arise because experience of administering the laws throws up anomalies and hard cases which are often quite unintended consequences of previous legislation. These can be put right only by changing the law. But an independent Commission which was not associated with the administration of the law would not be able to take effective initiative in this field. It would largely be dependent upon the much-abused Treasury to bring these anomalies to its attention, together with the suggested means of amending them. [HON. MEMBERS: "No."] This is what would happen in practice. The duplication which is involved in this proposal would not, I think, commend itself to those hon. Members, such as the hon. Member for Woking (Mr. Onslow), who are constantly urging us not to expand the Civil Service.
§ Mr. MacDermot
I can assure hon. Members that they are referred to the Treasury or, in the case of Service anomalies, to the Ministry of Defence, and the information is very rapidly and readily available to the Department.
At the other extreme are the big issues, some of which have been mentioned—for example, parity or full reckoning of unestablished service where considerable expenditure over a long period is involved. At present, parity would cost £90 million in the first year, and full reckoning would cost over £300 million in all over a long period, and even if it were introduced on a phased basis, several million £s annually would be involved in the first few years.
Here, quite apart from any questions of principle, the issues are, again, those of priorities. I do not see how any Government could do other than keep the handling of these affairs under its own control. In my experience in handling these problems related to pensions, I have found very little to fall between these two categories. Where specialist advice is needed, it is often in an actuarial form, and in that case advice is obtained from the Government actuary.
In short, I do not believe that the setting up of an independent Commission, as proposed, to operate in the sphere of public service pension is either necessary or appropriate. I know that this may come as a disappointment to many hon. Members who have come to argue the case today, but I take comfort from the fact that the same conclusion was reached by hon. Gentlemen opposite when they were in government—and, as I have said, they were supported in that conclusion by the then Opposition. —[An HON. MEMBER. "By the Treasury.".] By 75 hon. Members who were not all Financial Secretaries at the time.
The then Chief Secretary, the right hon. Member for Kingston-upon-Thames, said on that occasion that he would endeavour to find out whether some improvement in the present arrangements was possible. 987 To be fair to him, he added that it would be a rash man who would say that he would be able to find a better solution; and certainly he did not, in the event, find a better solution. In the Pensions (Increase) Act, 1965, we attempted to put right some of the more glaring anomalies which then existed. However, as has been said, my right hon. Friend the Chief Secretary said then that it was being introduced as a holding measure and that any radical revision of the system of pension increases would have to await the result of the wider social services review.
A number of hon. Members have referred again to a possible solution of this problem along the lines of an automatic provision—perhaps related to some economic index—for increases in public service pensions. My hon. Friend the Member for Chislehurst (Mr. Macdonald) in particular spoke on these lines. Far be it for me to suggest that the Government want to rule out the consideration of any proposals of that kind. It is difficult, when speaking at this Box, to express a personal opinion, but my view, as I have indicated previously, has been that if we are to get away from this exercise, whether biennial or triennial, of agitating and lobbying on behalf of these pensioners, it can only be done if we succeed in finding some way of introducing a built-in system of automatic increases of one kind or another.
As my right hon. Friend the Chief Secretary made clear in the 1965 Act debates, proposals of this kind cannot be considered in relation to public service pensions alone. Such proposals which are based on the principle of relieving pensioners from the hardship resulting from inflation must take into account the National Insurance pension as well.
It is sometimes forgotten in these debates that more than 90 per cent. of all public service pensioners are also in receipt of a National Insurance pension. Perhaps this is a convenient moment to reply to the hon. Member for Saffron Walden (Mr. Kirk) who asked me how our system compares with that of certain continental countries. It is a fact that some of the E.E.C. and E.F.T.A. countries have public service pension schemes which contain provisions which certainly approach the doctrine of parity. But what is sometimes forgotten when comparison 988 is drawn to them is that in all those cases they do not leave the equivalent to our National Insurance pension intact. There is abatement of one pension or the other so that, in consequence, one must look at the public service pension together with the National Insurance pension if one is seeking to introduce some sort of automatic provision of the kind suggested.
Yes, but that is on the assumption that the man is still fit and able to work. If he is not, then different considerations apply and he gets the pension increase. That is rather a different case and one cannot treat it as being just the same. So, in addition to this, there are other wider questions in this field that need to be considered at the same time. Clearly, if anything is to be done about pensions in the private sector, such as the question of the transferability of pension rights, or any provision for increases in pensions in the private sector, they would all be matters that it would be desirable to consider at the same time.
As the House knows, and as has also been mentioned, a fundamental review of the whole system of social security is now in progress. [HON. MEMBERS: "Oh."] It would obviously be inappropriate, and probably a complete waste of time, to try to make any fundamental change in the structure of public service pensions until that review is complete. [HON. MEMBERS: "When will that be?"] The position is that we are committed to reviewing not only the system of public service pensions, as were the previous Administration, but also our social security arrangements as a whole.
We shall certainly fulfil our pledges in this respect. But what we do not propose to do is to try to wash our hands of all the difficulties and complications by handing this over to an independent body in the pious hope that it will produce a solution for us, and, what is more, a solution that will make sense against the back-ground of the wider economic and social considerations to which I have referred.
§ Lieutenant-Commander S. L. C. Maydon (Wells)
The review has been going on since October or November, 989 1964. The hon. and learned Gentleman talks about fulfilling the Labour Party's pledges. Can he tell us when the findings of the review are likely to be made public so that those pledges can be fulfilled?
§ Mr. MacDermot
We have never pretended that this was a short-term business. It is obviously an extremely involved and complicated matter. The hon. and gallant Gentleman's party was in power for 13 ears but did not succeed in doing it. Perhaps hon. Gentlemen opposite will have a little more patience.
What does all this mean for the pensioners? Does it mean that they will have to await the outcome of the review before there is any chance of receiving any further pensions increase? This question was put to me, in effect, by the hon. Member for Orpington (Mr. Lubbock). I do not know whether it was suggested by some hon. Members that pensioners are, as it were, already overdue for an increase. I do not think that that was suggested, but I can certainly assure the House that, whatever happens in the course of the social service review, we shall in the meantime be keeping watch on the level of public service pensions, and if further action appears justified before the social service review is completed, we shall take what action is needed, if necessary in the form of a further increase Measure in the traditional pattern, without awaiting the result of the review.
The hon. Member for Orpington also asked for an assurance that in that case there would be some levelling up for the older pensioners. I entirely agree with him that this is a crucially important matter, and I think that we gave recognition to it in our last Measure. The older pensioners then had a 16 per cent. increase when, if my memory is correct, there had been a 13 per cent. increase in the cost of living since the previous Act. The result was that we gave a greater increase to the older pensioners and moved forward in the levelling-up process to which the hon. Gentleman referred.
In any event, I cannot agree that the point has yet been reached where action of that kind would be justified. It is 13 months since the last Measure came into effect, on 1st January, 1966. The effective date of the previous Act was 990 January, 1963. Between those two dates the cost of living had risen by 11.2 per cent. Since 1st January, 1966, the cost of living has risen by 31½ per cent.
I do not think on those figures that anyone would argue that the time was ripe yet for a further Pensions (Increase) Measure. As I said, we shall be watching closely the position of these pensioners and will take further action of an interim nature, if it is necessary, before we are able to introduce our measures for a more radical reform of the system.
This may be a disappointment to some hon. Members who have sponsored the Bill and spoken in support of it, but I can only repeat that, however sincere and well-intentioned their motives are—I fully accept that they are—the proposals contained in the Bill are neither necessary nor acceptable, and I must advise the House to reject them.
§ 3.15 p.m.
§ Mr. Eldon Griffiths (Bury St. Edmunds)
There was only one word in the Financial Secretary's speech with which I agreed. That was that his reply would be disappointing. It is more than disapointing. It is a very bad reply indeed. It will be received among public service pensioners as a cruel disappointment to their hopes.
The hon. and learned Gentleman made great play with the comprehensive review which allegedly is going on—I take it that it is going on—somewhere in the recesses of the Government. May I quote to him the comment of the National Association of Retired Police Officers in its recent publication on that subject:Public service pensioners have been told throughout the life of the present Administration that they must wait … until the completion of the Government's comprehensive review … but no information can be obtained as to whether this will be within the foreseeable future. Indeed, it is reasonable to assume that it will not be produced even if it is completed, so long as the economic freeze lasts.I think that the Association has a good point there.
When my right hon. Friend the Member for Mitcham (Mr. R. Carr) introduced the Bill, in a splendid speech, he said that it was not a party matter. I am sorry that the Financial Secretary made it a party matter. I support the Bill with confidence, because I know that it has 991 in my constituency the support, not just of Conservatives, but of Liberals and Socialists and of the "don't knows". This is not a party matter. I was returned to the House in a by-election under the Conservative Government. I said at that time that I believed that the Conservative Treasury Ministers were wrong in the attitude they took to public service pensioners. I said that then. I say it with even greater conviction now that Labour Ministers are taking the same attitude.
I support the Bill, first, on a matter of general principle, because it is time that we stopped treating the public service pensioner as the flotsam and jetsam of our society—pushed about one way and the other depending upon which party happens to be in power. I support the Bill, too, because we ourselves are public servants. I therefore think that we owe a particular duty to those who are part of us just as we are part of them.
The Bill is a modest Measure. It would cost no money. I hope that no hon. Member opposite will say that at a time of economic difficulties it is irresponsible to introduce the Bill. Nothing is called for from the public funds. The Commission is not asked to recommend until 1969. If the Financial Secretary says that the country will still be in the same parlous economic condition in 1969, he only confirms what we on this side believe to be the case.
I think that the Bill would have the inestimable advantage of going some way at least towards getting pensions off the hustings. We have all of us seen the disillusion, the cynicism, which is growing in the British people because politicians have over-promised. I do not acquit either side of the House of that propensity. Though how to raise money and how to establish priorities is always a political decision made by the Government, I am sure that it is time that we did something to stop pensioneering at our elections.
This Bill, modest as it is, would relieve three particular groups of people in Britain. It would relieve the pensioners themselves from the humiliating task of having continually to bang on the doors of Parliament, the Press, or anywhere else. It would relieve them every other year virtually of getting out a high-pressure begging bowl. Men and women 992 who have served our country well deserve better than that.
It would relieve, too, the civil servants. It would relieve them of a great deal of badgering and argument if only we could take this matter out of the hands of so many departmental Ministries, which are at present concerned with it, and get it under a single, independent, impartial and objective hat.
It would relieve a third group, very dear to us in the House—namely, Members of Parliament. We all get letters. Many have been quoted. Many of us feel helpless and hopeless in the face of those letters. How much better it would be if we had the benefit of an independent Commission's advice, and the ability to tell our constituents that they have not been forgotten, that this Commission is a continuing body concerning itself from day to day and from month to month with their affairs.
I turn briefly to two particular interests of mine. The first is my constituency, where there is a very large number of retired Army, Air Force and overseas Civil Service pensioners. Most of them have given the best years of their lives to this country. Most of them are still engaged in voluntary service, at county councils, in villages, doing the kind of thing without which our country would be very much poorer. They are having a very hard time, and they support the Bill with remarkable unanimity. The former soldiers, former teachers, and the former members of the overseas Civil Service, have impressed me with the unanimity of their support for this Measure.
My second interest concerns retired police officers. Theirs is a special case, because, to begin with, the police tend to retire early. The average constable and sergeant is compulsorily retired at the age of 55, and, as the House well knows, such has been the inflation in recent years that the younger a man is when he retires, the longer period will he have in which his pension will be eroded.
There is another special feature affecting the police service. The police were not brought within the National Insurance Acts until 1948. Therefore, any policeman—and there are many thousands—who retired before that time is not eligible in the normal way to benefit from the ordinary old-age pension.
993 I should like briefly to mention a precise example to illustrate my point. A police constable, retiring by September, 1967, will get, as his pension, £736 a year. That is the 1967 retirement pension. The man who retired in 1960, after the same 30 years of service, gets only £525. The man who retired in 1952, after the same years of service, gets only £481, and the man who retired in 1939, after the same years of service, gets only £393. So, depending on the year of retirement, a man may get, as he does today, £700-plus or £400-minus.
This cannot possibly be right. It is unjust, and I think the House recognises that. Other hon. Members will wish to speak, so I will not refer to the many individual examples which I have received. I will say only that there is, among retired police officers—and their widows, who are worse off—unanimous support for the Bill.
When I read the Bill, I wondered about its effect on the existing Whitley Council negotiating machinery. As the hon. Member for Ealing, North (Mr. Molloy) said, with reference to other sections of the public service, the police normally negotiate between the official side and the staff side, and that machinery takes into account the whole question of pensions. I wrote, therefore, to my right hon. Friend the Member for Mitcham and put our doubt or misgiving to him. He sent me a courteous reply, as always, in which he gave his complete assurance to those of us who were worried about the matter that his Bill would in no way compromise or infringe the sovereignty of the existing negotiating machinery. We were extremely grateful to him for that assurance, and I say to him in return that, in that knowledge, he has the strong support of the professional organisations of the police in this country.
The Government have turned down the Bill today in the knowledge that it would be a great help to many thousands of elderly and poor people, people who have given the best years of their lives to Britain. The Bill does not ask for money. Coming from the back benches, it could not ask for money. All it asks is that we should give these people some hope. Hope is the most precious thing that the hon. and learned Gentleman could have given 994 them today, but he has withheld even that.
Many of these pensioners, I fear, will die before the Government's comprehensive review is completed. I hope that hon. Members opposite, in considering how they will vote or in considering, as I suspect they will, whether to talk the Bill out because they are afraid of voting, will recognise that, in the years which pass before the Government's comprehensive review is completed, some of those for whom we have spoken today will have died without receiving from this country their undoubted desserts.
§ 3.27 p.m.
§ Mr. George Wallace (Norwich, North)
The hon. Member for Bury St. Edmunds (Mr. Eldon Griffiths) says that we should take pensions out of party politics. Even if the objectives of the Bill were achieved, they would not take the pension issue out of party politics. Pensioners themselves would probably make representations to the Commission. In any case, however desirable might be the principle of taking pensions or any other social question out of party politics, we never shall.
We had an instance of this today. The hon. Member for Bury St. Edmunds put in some special pleading for one section of pensioners whom he represents inasmuch as he is Parliamentary representative to the Police Federation. I do not object to that, but to say, on the one hand, that pensions should be taken out of party politics and then, on the other, to indulge in party politics on the very same issue is not fair.
§ Mr. Eldon Griffiths
In what way is reflecting in this House the desires of the police service a matter of party politics?
§ Mr. Wallace
Of course, it is. There is nothing to be ashamed of. Anyone would think that "party politics" was a dirty four-letter word. It is not. It is part and parcel of our job. We represent political opinions in this House and we represent constituents also. But to put ourselves in a white sheet and say, "No party politics", and then in this Chamber or in Bury St. Edmunds say, as the hon. Gentleman does, that one condemns the Government is sheer hypocrisy.
995 I support the hon. Gentleman on one issue. The Government have talked about their comprehensive review for far too long. It is time we had it, and until we have a continuing review of all pensions there will be some degree of injustice done to pensioners because of changes in the cost of living. But I cannot accept that this Bill would help in that aim because it would be a Measure for one section of the community only. I say that, having as much sympathy for that section as any other hon. Member has.
I think that the best way to do it is by an all-round comprehensive system, because one would not then make fish of one and fowl of another. It is for this reason, after great thought about the matter, that I will not support the Bill, because it would treat one section of the community differently from another.
No hon. Member can say that over a number of years I have not fought on the social services issue, particularly for old people. I understand the promoters of the Bill to say that it would not involve additional expense, but there is reference in the Bill to expenses being met by a Government Department.
Any hon. Member who imputes to another narrow party political motives in going into the Lobby against the Bill is entirely wrong. I would take my place beside the hon. Member for Bury St. Edmunds. My record is as good as, if not better than, his in fighting for justice for old-age pensioners. I spent 30 years fighting the Tory Party to get reasonable social services. I recognise that the present Government have gone far ahead of the Tories in the short period during which they have had absolute power, although I criticise them for their restraint and their delay in completing the comprehensive review. The quicker they do it the better. On the other hand, the Bill is not the way to deal with the problem that its promoters have presented.
§ 3.32 p.m.
§ Mr. A. P. Costain (Folkestone and Hythe)
I know that a number of hon. Members on this side of the House are anxious to take part in the debate, so I will curtail my remarks. One cannot, however, represent a constituency like Folkestone, which has a great number of retired pensioners, without realising the 996 importance of the problem. I therefore congratulate my right hon. Friend the Member for Mitcham (Mr. R. Carr) on introducing the Bill and on the way he has presented it.
I pledge myself here and now to support the Bill, whichever Government introduce it. [Interruption.] The hon. Member for Gravesend (Mr. Murray) laughs. He has not been here much today. He does not know the sincerity which has been shown in this debate.
§ Mr. Costain
No, I will not give way.
I realise that the problem for the Treasury on this matter is the balance between the public purse and the public conscience. I appreciate the difficulty of the Treasury and its officials putting forward a case which affects their own pensions, and I am sure that they have regard to the fact that they would be affecting their own position. We in this House, however, have ourselves been given the benefit of an independent commission to look into our own pensions. From the moment when that was done, I do not think that any hon. Member has the right to deny it to any other public servant. We have set that standard for ourselves and it should be the example for others.
The elderly pensioners in my constituency are hit particularly by the increases in rates. It is because of factors like this that any ordinary cost-of-living index does not apply to old-age pensioners. One of the most important items in their cost of living is fuel, which has increased a great deal more in cost than other factors in their cost of living.
Many of these people have settled down in their years of retirement to live in small bungalows. Unfortunately, in my opinion, small bungalows are over-rated. Because they can yield an income during the holiday months, they are given a higher rateable value. Factors like this have to be taken into account.
These are the reasons why we should, and must, have an independent Commission to look into these matters and to publish the facts. We do not say that the Chancellor of the Exchequer must accept them—we do not have power to say that—but we have the power to ensure that justice is seen to be done. In that way it could be done.
§ 3.35 p.m.
§ Mr. William Wilson (Coventry, South)
I am sorry indeed that I was not able to follow the hon. Member for Bury St. Edmunds (Mr. Eldon Griffiths) when he was talking about the condition of the police pensioners, because he took me back to my very first political meeting as a candidate. It was so long ago that I was ready to answer questions about the groundnut scheme. The first questioner was a police pensioner. He asked me what I would do, if I were elected, about the pensions of retired police officers. My answer was completely off the cuff. It was simply that I looked upon the work which they did while they were police officers as continuing even in their retirement, because the benefits of their work showed themselves in the years after they retired.
The object of the Bill of bringing up the pensions of retired public servants and individuals retired from the Armed Forces is one which must, by its sense and essentiality, command support. I sometimes think back to that election of 1951 and the reply that I gave, and wonder whether or not we have made any real progress to meeting the problems of these pensioners. It is in that light and in that sentiment that I speak this afternoon.
I am not very impressed by the argument about what right hon. and hon. Gentlemen opposite said when they were on this side of the House, because really it is so much verbiage. The real question is, what is to happen to these pensioners? Are we to give them an increase, or are we not to give them an increase?
Looking at this Bill I ask myself, will it, honestly, take us nearer the point where the pensioners will receive an increase in their pensions and where the many anomalies which exist will be dealt with and the pensioners' needs provided for? The more I have thought about that—and I have listened to a considerable part of this debate—the more have I come to the conclusion that I cannot see that the setting up of this Commission would virtually bring the needs of the pensioners nearer being met. Indeed, I have heard it said in the last few minutes that the Bill, if it became law, would not really cost us anything at all. That is really the objection I have to the Bill, because I want a Bill which will 998 bring about an increase in the pensions. For that reason I feel that to say that the Bill is not going to cost anything, and then to commend it to the House as the means of solving the problems of the pensioners, is just verbiage once more.
§ 3.38 p.m.
§ Sir George Sinclair (Dorking)
In the few minutes allowed to me I should like to say, having the interests of the overseas pensioners especially in mind, what a great disappointment will be the answer given to us from the Government side today. They had been looking forward to the culmination today of a long-supported and determined effort by back benchers in debates at the Second Reading of several Public Service and Armed Forces Pensions (Increase) Bills—an effort to get the review of these pensions put on a more regular basis.
We have heard again all those phrases, which ring so true, about pensioners having to go cap in hand to the Government, forming pressure groups, and lobbying M.P.s at irregular intervals as the pinch becomes more and more difficult and as they find themselves up against the rising cost of living.
Until today, this was not a party issue. It was not produced as a party issue by my right hon. Friend the Member for Mitcham (Mr. R. Carr), who moved the Second Reading of the Bill in such measured terms and with such a wide reference to support from both sides of the House.
I would ask hon. Members to bear in mind the work done by right hon. and hon. Gentlemen on both sides of the House in the pensions increase debates of 1962 and 1965. I am very sorry that the right hon. Member for Sowerby (Mr. Houghton) is not here today to give support to the movement, in which he played such a great part, to get a less haphazard means of dealing with this review. I regret the absence of my right hon. and learned Friend the Member for Chertsey (Sir L. Heald), who spoke earlier today. I have the honour to have him in my constituency. He also, in earlier debates, played a great part. The hon. Member for Walthamstow, West (Mr. Redhead) made a sustained effort to get a more rational system for the review of pensions. Support came from all sides of the House. Do not let 999 us pretend that the strong tide of determination of back bench Members will not affect the position in the end.
I think that the Government are wrong. The Treasury was knocked off course in 1956, when the principle of immutability upon which it had been holding back the adjustment of pensions for many years, was abandoned.
Now there is pressure mounting in the country, and through back bench Members it will come again, to get a regular review system established not only for overseas pensioners but for all those covered by the Bill. That tide will not be easily stemmed.
I think that the hon. Member for Walthamstow, East (Mr. W. O. J. Robinson) was rowing against this tide when he flew the Treasury flag from his bows. I do not believe that the Government will be able to withstand the tide for long.
At this point, I must declare an interest. I number myself among the members of the Overseas Pensioners' Association. There are some 10,000 of them looking forward to a favourable result today. As a member of that Association, therefore, I am involved in any future increase in pensions. We want to see pension increases taken out of the haggling of the market, and put on to a dignified basis. We hoped for some reassurance from the Financial Secretary. Instead, we got the old threadbare argument from the Treasury that the Bill was too rigid and might work against the interests of pensioners. However, that is a risk which, I am sure, they would be prepared to run.
I am sorry that the Government have given such a disappointing answer today. All that I can do is to pledge the effort of a great number of back bench Members on both sides who will go on trying to get a regular review system built into the pensions increase legislation.
I am grateful to have had an opportunity to say a few words, in the closing minutes of this debate, on behalf of the overseas pensioners, who are grateful to have been brought within the orbit of this Act by a Conservative Government in 1962.
1000 In conclusion, I wish to pay tribute to my right hon. Friend the Member for Kingston-upon-Thames (Mr. Boyd-Carpenter) who piloted that Measure through in 1962, and to my hon. Friend the Member for Liverpool, Wavertree (Mr. Tilney) who got overseas pensioners brought within the ambit of the Act.
§ 3.45 p.m.
§ Mr. Cranley Onslow (Woking)
I think the House will agree that this has been a very good debate, and will be grateful to my right hon. Friend the Member for Mitcham (Mr. R. Carr) for choosing this as the subject of the Bill for which he is seeking a Second Reading, and also for the way in which he introduced it. I am particularly grateful to him for the kind words which he used about my part in helping him.
When I made my maiden speech in the House, I said that it was one of my hopes that at any future regimental re-union there would be no need to set a place for the spectre of poverty, however genteel, and if, as I think it will, this Bill goes some way towards removing that unwelcome necessity I shall be very pleased to see it become law.
The people who want to see this Bill become law—and there are many more of them than the Financial Secretary suspects—will be grateful for the support which my right hon. and hon. Friends have given to the case put before the House today, and the powerful, and as I think overwhelming, arguments which have been deployed, and the evidence which has been adduced in support of the Measure.
There have been many speakers from this side of the House, but my hon. Friend the Member for Somerset, North (Mr. Dean) has sat here throughout this debate and I am sorry that he has not had an opportunity to speak because I know of his close interest in this matter.
I do not wish to rehearse at length all the arguments which have been put forward in support of the Bill, but I should like to deal briefly with one or two of the arguments which have been put forward against it, and I hope that I shall not be thought guilty of being political or contentious if I say that they appeared rather thin.
Earlier today we had a contradictory set of arguments, one from the hon. 1001 Member for Walthamstow, East (Mr. W. O. J. Robinson), who broadly deployed the view that everything was all right, that we should leave things alone, and the other from the hon. Member for Chislehurst (Mr. Macdonald), whose main criticism was that the Bill did not go far enough. These two arguments seem to cancel each other out and leave the Bill in the middle as an acceptable compromise to both hon. Gentlemen.
We then had from the hon. Member for Walthamstow, East a slightly curious argument, which was picked up by the hon. Member for Southall (Mr. Bidwell), and by the Financial Secretary, that one objection to the Bill was that it would create more civil servants. I hope that the hon. and learned Gentleman will accept that this is not one of my purposes in coming to the Chamber today to speak, and he may well have some past evidence to bear out my contention in this. I suppose that there might be a marginal increase in the total number of public employees if this Commission is established and staffed adequately, but I think it unlikely that it will run into three figures. But should the hon. and learned Gentleman think that this is alarming and overwhelming, if he gives me 10 minutes at his desk I will cut 10 times that number of civil servants and pay for the increase in pensions into the bargain. I hope that we shall not hear very much about that unconvincing argument.
From the hon. Member for Ealing, North (Mr. Molloy) we heard a point of view which may seem to have some colour, and with which my right hon. Friend and I in dealing with the pensioners organisations and in drafting the Bill were very careful to cover. It is the argument that the staff side of the Civil Service are necessarily adequate negotiators in the cause of the pensioners.
I think that this is a rather dangerous view to take. My hon. and gallant Friend the Member for Carshalton (Captain W. Elliot) quite rightly put forward the proposition that the negotiators on behalf of established civil servants have as their main and chief duty to represent the interests of existing employees. He said that they have to seek to scrape the bottom of the Treasury barrel. I would not suggest that anyone 1002 should be so indelicate to the Treasury as to do that, but this is a point of view, and I ask whether it is right that the Staff Side should be put in an invidious position, where it should be part of its function to negotiate on behalf of pensioners. The question, indeed, whether they want to do this, whether it is not in itself just as objectionable that they should be doing this or be forced to do it, as that the Government should be both judge and advocate in their own cause—and the Government have been rightly criticised on this very score. Should we be happy with a state of affairs in which it is possible, even if it does not necessarily happen, for the pensioners to be a pawn in negotiations between employer and employed? I for one do not find that at all an acceptable state of affairs.
We also heard from the hon. Member for Bebington (Mr. Brooks) an attack on what he called the Bill's ambiguities. At best, most of those were Committee points and at worst they were examples of legal logic chopping which do not carry us much further forward.
The Financial Secretary kept a face of commendable straightness while reading what must have been a rather indigestible brief. I find his arguments against the Bill singularly unconvincing. His first was that because something similar was rejected before, we should reject it again. That is not an argument that is ever likely to lead to progress. Perhaps he finds it convenient but it did not carry great force. I may have misunderstood him but his second criticism of the Bill apparently was that he disliked the idea of the Commission because its recommendations would not be mandatory. But, of course, they could not be mandatory and he subsequently accepted that, and the fact that power must be left with the Government and that it was right to do so. Therefore, that did not get us very far either.
He also said that the creation of a Commission would not eliminate haggling but merely add another stage in the negotiating process or give another weapon to those who wanted to see pensioners receive an increase. Was that really in the Treasury brief? "Give another weapon" is an interesting remark. Perhaps that is what we need; perhaps that is what the debate is all 1003 about, and we are here because there are not enough weapons and we want more. If the attitude is that those who seek to fight on behalf of the pensioners must not have weapons, it seems a very dangerous attitude.
§ Mr. MacDermot
My reference to the weapons was only to answer the argument of those who appear to think that the Commission could be a trade union for the pensioners. There seems to be some inconsistency in the arguments of hon. Members opposite that it would be both advocate and judge in the pensioners' cause.
§ Mr. Onslow
The hon. and learned Gentleman must have misunderstood the purpose of the Commission. It would be a judge to which pensioners could put their advocacy. That would be its best and most important purpose. Its recommendations would be independently and impartially arrived at and might or might not be a weapon to get action from the Government. But it would be seen to be an independent and impartial process.
The hon. and learned Gentleman had some other arguments to read out. I shall not detain the House by going over them at great length, but they seemed to suggest that public service pensioners did not need special attention, not merely in the immediate context, but in general, on the grounds that they had shared in the increases in general prosperity. I challenge that view. I have received a letter from the Secretary of the Civil Service National Whitley Council, in which he says:There is no doubt, therefore, that public service pensioners have not shared in the general increases enjoyed by the rest of the community.The hon. and learned Gentleman went on to say that we must be kind to anomalies; he is evidently a founder member of the "Society for the Preservation of Anomalies." He seems to say that because anomalies are there we must not eliminate them, and that in any case it would be necessary for the Treasury to draw their existence to the Commission's attention. I doubt that very much. I doubt whether my hon. Friend the Member for Bury St. Edmunds (Mr. Eldon Griffiths) would have to wait for the Treasury to draw to the Commission's attention anomalies in the position 1004 of police pensioners, or whether it would be necessary to wait for the Treasury to draw to the Commission's attention the fact that widows of private soldiers discharged in August, 1950, get no pension, although their husbands might have served for as much as 32 years. On the other hand, the widow of a soldier discharged three months later can get a pension of up to 33s. 4d. a week. We all know this, but no one seems to be doing anything about it. This is what we are trying to do something about today.
I was depressed during the hon. and learned Gentleman's speech to find that he had no better solution to offer—indeed, no solution at all except the reference to the "non-stop review" by the "Windmill Government", the idea that it will all sort itself out somehow. He stands before us like a latterday Pangloss, proclaiming that all is for the best in the best of all possible worlds. That is not a view which we or the pensioners share or a view which he should expect them to endorse.
The Bill sets out to meet a number of inadequacies with which we are all familiar in the pensioners' position and their scope to improve it. They are just as keen as we to see an end to "pensioneering". They like it no more than we or the Treasury do. It is not dignified or democratic. My right hon. Friend and I met many pensioners' organisations, including bodies representing police, officers' and Civil Service pensioners, and we drafted the Bill in careful consultation with them. They want it.
I want there to be no misunderstanding in the Financial Secretary's mind about that. This Bill has the support of the pensioners' organisations. Its purpose is to put right the inadequacies of the Treasury and I can use the hon. and learned Gentleman's own testimony for this existence. He told us, something which he repeated again today, on 18th November, 1965:In fact, there is a section at the Treasury which, with great skill, goes into these matters and is carefully watching the whole time the position of pensions in relation to the other factors, in particular changes in the cost of living. As soon as the gap has widened to a point when it is felt that the matter should be brought to the attention of Ministers, that is done.But we are here today because we are not satisfied that this is done, and we 1005 want it put right. This is the Treasury cocoon, which my hon. Friend the Member for Saffron Walden (Mr. Kirk) was talking about. He at least has had the power and time to burst out of it. Perhaps one day the Financial Secretary will.
The Bill will also put right the inadequacies of Parliament and the inability of hon. Members to get action from Front Benchers. My right hon. and learned Friend the Member for Chertsey (Sir L. Heald) was right: this is a battle between back benchers and the Treasury and the Government.
Again, I would quote the Financial Secretary in support of my argument. Also on 18th November, he said:It is clear to anyone who has listened to the debate and read reports of similar debates in recent years"—
this was 1965—
that there is general dissatisfaction in all parts of the House with this excessively empirical approach."—[OFFICIAL REPORT. 18th November, 1965; Vol. 720, cc. 1461 and 1449.]
§ This is as true today as when he said it.
§ So this Bill is a way to improve the situation. It has the support of the pensioners and I believe that it deserves the support of the House. I hope that this afternoon it will get it.
§ Question put, That the Question be now put:—
§ The House divided:Ayes 96, Noes 105.1007
|Division No. 262.]||AYES||[3.58 p.m.|
|Allason, James (Hemel Hempstead)||Gresham Cooke, R.||Mott-Radclyffe, Sir Charles|
|Beamish, Col. Sir Tufton||Griffiths, Eldon (Bury St. Edmunds)||Murton, Oscar|
|Bennett, Dr. Reginald (Gos. & Fhm)||Harris, Frederic (Croydon, N.W.)||Neave, Airey|
|Berry, Hn. Anthony||Harrison, Brian (Maldon)||Orr-Ewing, Sir Ian|
|Blaker, Peter||Harvey, Sir Arthur Vere||Page, Graham (Crosby)|
|Body, Richard||Harvie Anderson, Miss||Peel, John|
|Boyd-Carpenter, Rt. Hn. John||Hastings, Stephen||Pike, Miss Mervyn|
|Braine, Bernard||Higgins, Terence L.||Pounder, Rafton|
|Brown, Sir Edward (Bath)||Hill, J. E. B.||Pym, Francis|
|Burden, F. A.||Hobson, Rt. Hn. Sir John||Quennell, Miss J. M.|
|Campbell, Gordon||Hogg, Rt. Hn. Quintin||Rawlinson, Rt. Hn. Sir Peter|
|Channon, H. P. G.||Howell, David (Guildford)||Renton, Rt. Hn. Sir David|
|Clark, Henry||Hutchison, Michael Clark||Ridedale, Julian|
|Costain, A. P.||Iremonger, T. L.||Rippon, Rt. Hn. Geoffrey|
|Crawley, Aidan||Irvine, Bryant Godman (Rye)||Rodgers, Sir John (Sevenoaks)|
|Crouch, David||Jenkin, Patrick (Woodford)||Roots, William|
|Currie, G. B. H.||Jennings, J. C. (Burton)||Royle, Anthony|
|Dance, James||Johnson Smith, G. (E. Grinstead)||Russell, Sir Ronald|
|Dean, Paul (Somerset, N.)||Kerby, Capt. Henry||Scott, Nicholas|
|Deedes, Rt. Hn. W. F. (Ashford)||Kershaw, Anthony||Sharples, Richard|
|Dodds-Parker, Douglas||Kirk, Peter||Sinclair, Sir George|
|Doughty, Charles||Lloyd, Rt. Hn. Selwyn (Wirral)||Smith, John|
|Drayson, G. B.||Longden, Gilbert||Taylor, Sir Charles (Eastbourne)|
|du Cann, Rt. Hn. Edward||Lubbock, Eric||Thatcher. Mrs. Margaret|
|Eden, Sir John||McAdden, Sir Stephen||van Straubenzee, W. R.|
|Elliot, Capt. Walter (Carshalton)||MacArthur, Ian||Walters, Dennis|
|Fraser,Rt.Hn.Hugh(St'fford & Stone)||Mackenzie, Alasdair(Ross&Crom'ty)||Ward, Dame Irene|
|Giles, Rear-Adm. Morgan||Macmillan, Maurice (Farnham)||Weatherill, Bernard|
|Gilmour, Ian (Norfolk, C.)||Maddan, Martin||Wells, John (Maidstone)|
|Glover, Sir Douglas||Maxwell-Hyslop. R. J.||Worsley, Marcus|
|Glyn, Sir Richard||Maydon, Lt.-Cmdr. S. L. C.|
|Goodhart, Philip||Mills, Stratton (Belfast, N.)||TELLERS FOR THE AYES:|
|Grant, Anthony||Mitchell, David (Basingstoke)||Mr. Cranley Onslow and Mr. Robert Carr.|
|Atkinson, Norman (Tottenham)||Buchan, Norman||Diamond, Rt. Hn. John|
|Benn, Rt. Hn. Anthony Wedgwood||Butler Mrs. Joyce (Wood Green)||Dickens, James|
|Bidwell, Sydney||Cant, R. B.||Driberg, Tom|
|Binns, John||Chapman, Donald||Dunwoody, Mrs. Gwyneth (Exeter)|
|Booth, Albert||Coe, Denis||Dunwoody, Dr. John (F'th & C'b'e)|
|Boston, Terence||Corbet, Mrs. Freda||Edelman, Maurice|
|Bottomley, Rt. Hn. Arthur||Cronin, John||Edwards, Robert (Bilston)|
|Boyden, James||Crossman, Rt. Hn. Richard||English, Michael|
|Bray, Dr. Jeremy||Darling, Rt. Hn. George||Ennals, David|
|Brooks, Edwin||Davidson, Arthur (Accrington)||Fitt, Gerard (Belfast, W.)|
|Broughton, Dr. A. D. D.||Davies, Robert (Cambridge)||Fletcher, Raymond (Ilkeston)|
|Brown, Rt. Hn. George (Belper)||Delargy, Hugh||Floud, Bernard|
|Brown. R. W. (Shoreditch & F'bury)||Dell, Edmund||Foley, Maurice|
|Foot, Sir Dingle (Ipswich)||Macdonald, A. H.||Pavitt, Laurence|
|Foot, Michael (Ebbw Vale)||McKay, Mrs. Margaret||Percy, Ernest G. (Battersea, S.)|
|Ford, Ben||Mackie, John||Prentice, Rt. Hn. R. E.|
|Fraser, John (Norwood)||Maclennan, Robert||Rankin, John|
|Gardner, Tony||MacPherson, Malcolm||Redhead, Edward|
|Gordon Walker, Rt. Hn. P. C.||Mallalieu, J.P.W. (Huddersfield, E.)||Richard, Ivor|
|Gregory, Arnold||Marquand, David||Robinson, W. O. J. (Walth'stow, E.)|
|Hart, Mrs. Judith||Marsh, Rt. Hn. Richard||Rowland, Christopher (Meriden)|
|Healey, Rt. Hn. Denis||Mellish, Robert||Shaw, Arnold (Ilford, S.)|
|Horner, John||Mendelson, J. J.||Short, Rt. Hn. Edward(N'c'tle-u-Tyne)|
|Howie, W.||Mikardo, Ian||Silkin, Rt. Hn. John (Deptford)|
|Janner, Sir Barnett||Mitchell, R. C. (S'th'pton, Test)||Skeffington, Arthur|
|Jenkins, Hugh (Putney)||Molloy, William||Spriggs, Leslie|
|Judd, Frank||Morris, Alfred (Wythenshawe)||Storehouse, John|
|Kerr, Mrs. Anne (R'ter & Chatham)||Moyle, Roland||Tuck, Raphael|
|Kerr, Dr. David (W'worth, Central)||Murray, Albert||Wallace, George|
|Kerr, Russell (Feltham)||Newens, Stan||Wellbeloved, James|
|Lee, Rt. Hn. Frederick (Newton)||Noel-Baker, Francis (Swindon)||Wilson, William (Coventry, S.)|
|Lee, Rt. Hn. Jennie (Cannock)||Oram, Albert E.||Winnick, David|
|Lestor, Miss Joan||Orbach, Maurice|
|Lipton, Marcus||Owen, Dr. David (Plymouth, S'tn)||TELLERS FOR THE NOES:|
|MacColl, James||Owen, Will (Morpeth)||Mr. Alan Fitch and Mr. Ernest Armstrong.|
|MacDermot, Niall||Pannell, Rt. Hn. Charles|
§ Debate to be resumed upon Friday next.