REVIEW

HC Deb 17 February 1969 vol 778 cc107-41

The Minister shall, as at 1st April 1971, undertake a review of all pensions to which this Act applies and shall estimate the change if any in the purchasing power of such pensions since the last date or dates upon which such pensions were increased or if they were not so increased since the date or dates upon which they were first paid, and if in the case of any such pension there has been a reduction in any such purchasing power of more than 4 per cent. since such date or dates as aforesaid, then the Minister shall present a report to Parliament specifying the extent of any such reduction, the pensions to which it applies and the action which he proposes to take.—[Mr. Patrick Jenkin.]

Brought up, and read the First time.

7.19 p.m.

Mr. Peter Hordern (Horsham)

I beg to move, That the Clause be read a Second time.

We turn from the responsibility of youth for itself to our responsibilty for the old. We felt that we ought to put down in this new Clause as nearly as we could the assurance which was given by the Parliamentary Secretary in Committee on the Bill. I should like to remind the House of the terms of that assurance. The Parliamentary Secretary said: I am therefore ready to undertake that we will review the change in the purchasing power of the pensions to which this Bill applies as at 1st April, 1971, and if their purchasing power has been reduced by more than 4 per cent. … the Government will make a statement indicating both the extent of the reduction in the purchasing power of the pensions and what action they propose to take."—[OFFICIAL REPORT, Standing Committee F, 11th February, 1969; c. 87.] That assurance was given in response to the request that was strongly put forward on our side of the Committee—namely that the Minister should review, publish and state what he will do. We want to see this undertaking set out in the Bill, not merely because the undertaking by the party opposite is of no value as it will be in no position to implement anything after April, 1971, but because it represents a substantial change in existing legislation affecting pensions increases.

Previous public service pensions increases have depended on the severity of the pressure exerted on Governments and the pressure of organisations and of the inexorable increase in the cost of living. The Government have undertaken to carry out a review of the increase in the cost of living two years after the Bill comes into force, provided only that the purchasing power of the pension has been reduced by more than 4 per cent. in that period. This is not a very substantial provision. There has been only one consecutive two-year period over the last ten years when the cost of living has risen by less than 4 per cent., and that was between 1958 and 1960, when it increased by 1.8 per cent. Indeed, the cost of living has increased by 9.6 per cent. in the last 18 months. We may be sure, therefore, that there will be a further review to take into account the increase in the cost of living up to April, 1971.

I wish I could think that there was a real prospect that further Pensions (Increase) Bills will not be necessary every two years after that, but so long as Governments continue to finance their expenditure by an increase in the money supply rather than by genuine borrowing, so long will inflation continue and reviews be required at regular intervals. There is no provision in the new Clause for a regular biennial review, but the House will know that the Conservative Party is committed to such a review and that this was incorporated in our original new Clause in Committee, but we thought it right to write into the Bill the assurance given by the Parliamentary Secretary, which constitutes a substantial advance on existing practice, and a substantial advance on what the Government were originally prepared to offer.

I remind the House of what the Parliamentary Secretary said on our new Clause during Committee: Turning to the new Clause more generally, I have already said that I do not consider that it would be wise to accept it. The reason is that other arrangements—very suitable arrangements—are going ahead for a detailed and careful examination of what must be a complex problem, and it would be inappropriate to provide in the Bill an alternative way of reviewing and increasing public service pensions. It would prejudice the adoption of what might be regarded as something better emerging from the Committee's considerations."—[OFFICIAL REPORT, Standing Committee F, 4th February, 1969; c. 73.] I recognise there the familiar ring of the Treasury brief, but within five days that Treasury brief was squashed, and I only hope that the final result will be substantially better.

We have achieved the main objective of the new Clause, which is the adoption of the principle of a two-year review, and the bird in the hand—and it will be in our hand when the time comes to implement the proposal—is worth a large number of other birds in bushes, however attractive those birds in bushes may be. Apart from whatever may have happened in those fateful five days, the Government could not in justice have refused the new Clause, in view of the proposal set out in the White Paper on National Superannuation and Social Insurance, Cmnd. 3883, paragraphs 101 and 102 of which state: Under the new scheme the Government will be bound by Statute to review every two years the main rates of pensions and other benefits (including industrial injuries benefits) in payment. The reviews will cover present-scheme as well as new-scheme and other benefits. The increases, which will always come into operation in the autumn, will compensate for any rise in price levels since the previous increase. But this inflation-proofing is only a minimum. Pensioners and other beneficiaries will also continue to share in the nation's rising living standards. The actual amount of improvement on each occasion, beyond the inflation-proofing, must be left for decision by the Government of the day, which will need to take into account such factors as movements in earnings levels, changes in the standard of living of the community as a whole, and the general economic situation. The Government propose that the benefit increases should be brought about by regulations, without the present need for a new Act of Parliament on each occasion. It is scarcely conceivable that the treatment of public service pensioners could be less favourable than the White Paper proposals for national insurance benefits. The right hon. Lady the Paymaster-General on Second Reading went far to make sure that the House appreciated this point by saying that any new system of public service pensions … will now fall to be considered in the light of our proposals for the new State earnings-related pension scheme. … We can now consider public service pensions, which are occupational pensions of a particular kind, and the pensioner's total position under the new scheme. Now that our long-term proposals in the national field have been formulated and presented we intend to see what better arrangements we can devise for the future."—[OFFICIAL REPORT, 28th January, 1969; Vol. 776, c. 1130.] It is, therefore, inconceivable that public service pensions can be treated less generously than the proposals for the National Insurance increases.

If the Government think that there should be a two-year review and that benefit increases should be brought about by regulations, then one must assume that that is what will also be proposed for public service pensions increases in the future.

We note from the White Paper that the target date is to be April, 1972, and that payments to allow for increases under those proposals will start in the autumn. It would, therefore, be convenient that public service pensions should again be reviewed in April, 1972, at the same time as the proposals for the National Insurance benefits and that the payments should come into effect at the same time—namely, in the autumn. I can only presume that this is the reason why the Government have not themselves inserted in the Bill a new Clause covering the points which we have made. The review will take place a year after the biennial review about which they have already given an assurance. What is wanted, as has been said in every debate on every Pensions (Increase) Bill, is a regular review at least every two years, without the necessity of coming to the House. On Second Reading the hon. Member for Bristol, Central (Mr. Palmer) proposed that there should be an enabling Bill which would allow regular orders of this kind to be brought before the House, and this proposal would seem to match what we want.

We hope that the Committee considering the way in which public service pensions will be increased in future will come to a speedy conclusion. Although the Clause is modest in relation to what remains to be done, it contains a substantial advance on existing practice, and the House as a whole and the back benchers on both sides should take the credit for it. The Government dare not refuse it.

7.30 p.m.

Mr. Charles Mapp (Oldham, East)

This new Clause first saw the light of day in Committee upstairs, and it may be that I influenced the increase in the figure originally chosen from 2 per cent. to 4 per cent. On reflection, I think that it was generally agreed that 4 per cent. was a much more reliable and firm figure to use as a yardstick.

I would ask hon. Members to recall what happened in Committee, and then consider whether the Clause is really necessary. In that connection, I think that it would be helpful to pay some regard to the arguments surrounding the need for a review.

Towards the end of the Second Reading debate, I gained the impression from what had been said by hon. Members on both sides, that, following five preceding reviews, three by Conservative Governments and two by Labour Governments, and regardless of where the blame for earlier errors lay, it was felt generally that provision for a regular review must be written into the legislation. That I proposed to do.

In Committee, I sought to align myself with the principle of the new Clause Until then, the Government had not committed themselves on this narrower sphere of occupational public pensions. Two or three days before the debate, the new White Paper had been published, and hon. Members had to make their contributions on the basis of a very sketchy reading of it. But my impression, which has been confirmed since, was that the review promised in the White Paper covering the whole range of pensions was clearly conditional, for all sorts of reasons. We had the White Paper, with the promise of a Bill and, if everything turned out favourably, we might see it come into operation in 1971. In my mind, that was significant. In addition, the Government might have changed their minds about a two-year review. Other factors might have been in the Minister's mind about the timing of it. The Minister might decide on a two-year or a periodical review, or even on one which depended upon certain changing criteria.

It was with those factors in mind that, in Committee upstairs, I referred to the unfortunate impression among people who, because of the erosion of money values, wrote pathetic and not well- informed letters about our procedures saying, in effect, that it was time for a review of public pensions. In my opinion, it was degrading for them to have to write such letters, and we ourselves were a little cynical in adding our names to an Early Day Motion giving the impression to people outside that something would be done, when we knew that such a Motion did not result in any great Parliamentary advantage for the sort of measure that we had in mind. I felt that some of those decent people who had been writing to their Members of Parliament were a little misled by it.

Mr. J. C. Jennings (Burton)

Knowing the hon. Gentleman as I do, I am sure that he is not imputing wrong motives to those hon. Members who sponsored such a Motion. He knows that such Motions are part of a pressure policy intended to persuade the Government of the day to adopt a certain line of action.

Mr. Mapp

Of course. That is the last thing that would enter my mind. Indeed, it would not enter my mind at all, because there would be no room for it. I was trying to draw attention to the need, which had become evident, for members of the public to have to write to their Members in this way every two or three years. I felt that this House could find ways of avoiding people having to write to us in that unhappy way and of ourselves having to write back ponderous letters.

In Committee, at first I tried to draft a suitable form of words myself. I would have persevered had I not found the Opposition's words, if amended, much better than anything I could have produced. When we discussed the Amendment upstairs, I referred to some earlier reasons why the principle should be adopted, and I said frankly: If the Minister were prepared to give an undertaking to this Committee and to the House—and therefore to the appropriate Whitley Council which is now examining the far wider question—that in any case he will undertake to review this narrower field within two years from 1st April, 1969, and report his findings to the House, I should be prepared to accept that."—[OFFICIAL REPORT, Standing Committee F, 6th February, 1969, c. 65.] In the event, I said that my views would be supported by my vote in the Committee. I am glad to say that my reasoning commended itself to one of my colleagues, the hon. Member for Preston, North (Mr. Ronald Atkins), who felt, as I did, that the Government were not being asked to do anything outrageous in accepting the principle of the new Clause.

The Committee concluded its sitting that day without a vote being taken. On the following Tuesday, the Minister was very much more forthcoming, and gave us the kind of undertaking which had been sought. It was the kind of undertaking which, normally, the House would accept. He said: I am therefore ready to undertake that we will review the change in the purchasing power of the pensions to which this Bill applies as at the 1st April, 1971, and if their purchasing power has been reduced by more than 4 per cent.—I take the figure of the Amendment put forward by my hon. Friend, because it is more realistic than the figure of 2 per cent. in the Clause, with which proportion I do not think the hon. Gentlemen opposite will be disposed to disagree—the Government will make a statement indicating both the extent of the reduction in the purchasing power of the pensions and what action they proposed to take."—[OFFICIAL REPORT, Standing Committee F, 11th February 1969, c. 87.] I thought about those words after the Minister spoke, and I felt that we had succeeded in getting about 99 per cent. of what we asked. My reservation lay in the fact that the White Paper promised a review on the general front. Had there been no such White Paper and no general guarantee of that kind, I might have disappointed my right hon. and hon. Friends on the Treasury Bench, so overwhelming did I feel was the need for a review and that it should be written into our legislation. But merely because the legislation will carry us forward to 1971 and because the White Paper has appeared in the meantime containing a firm prospect for the future, it may be that the Government's initiative will have repercussions on right hon. and hon. Gentlemen opposite, even on general pensions arrangements. They invariably write their policy about five years after we have set out the principles. Therefore, I felt that here was an undertaking that we could firmly accept.

I have since made inquiries of people who try to get these reviews through us. Generally speaking, they are happy with the Parliamentary position reached in Committee. Therefore, if the House is faced with a Division on the issue of the new Clause this evening, it will not be concerned with the issue of principle, nor whether the Government have conceded what the new Clause is asking for; it will probably be on the question of the image outside. I shall regret it if the Opposition feel disposed, by merely having a vote, thus to demonstrate their will for the new Clause. The facts are that victory is already with us. The Government have accepted the position. I make my contribution in the hope that the Opposition will see the advantage of withdrawing the new Clause after discussion.

Mr. Jennings

I regret that I was unable to be a member of the Standing Committee that considered the Bill by reason of being chairman of the First Scottish Grand Committee which was meeting at the same time. Nevertheless, I have followed with great interest and have read closely the OFFICIAL REPORT of the three sittings of the Standing Committee on the Pensions (Increase) Bill. In what I am about to say I support the new Clause.

I was particularly interested in the statement by the Parliamentary Secretary in col. 87, which has already been quoted. There are three points in this statement of which to take note. The first is that in the Clause and in the Parliamentary Secretary's statement there is a recognition of a principle. The Parliamentary Secretary said that the principle was … that the Government should provide a specific opportunity for Parliament to take stock of the position within a reasonable time…"—[OFFICIAL REPORT, 11th February, 1969; Standing Committee F, c. 87.] The Clause does that in specific wording. Secondly, the Clause, as the undertaking of the Parliamentary Secretary also states, gives a specific date: 1st April, 1971. Thirdly, the Clause omits any reference to a biennial review. So did the statement by the Parliamentary Secretary. This was not the principle at stake in that portion of the Committee's deliberations. So we have the Parliamentary Secretary's statement and the contents of the Clause on all fours, one with the other.

Where do we differ? Why has the Clause been put down? I read the statement by the Parliamentary Secretary with great satisfaction. It was most commendable and acceptable. First, it created a precedent in all the history of public service pensions we have never had a breakthrough like this. I commend the Government for making this statement and giving this concession. It establishes the principle and the policy of a single review. This is a verbal, although a categorical statement, and without hesitation I accept it, because I believe, quite sincerely, that the Government are prepared to carry out this single review. But we must remember something very important.

The hon. Member for Oldham, East (Mr. Mapp) would not press a new Clause like this. He referred to the White Paper, the subsequent legislation, and the fact that occupational pensions may or should have a special place and some treatment in the new legislation concerning income-related pensions. We are not yet certain what that place will be or what arrangements will be made. Nor are we certain that they will be in operation on 1st April, 1971, the date specified both in the new Clause and in the statement of the Parliamentary Secretary. Therefore, I submit that neither the White Paper nor any proposed legislation on the White Paper has any bearing on this date. I think that the most important fact is 1st April, 1971. Unless something unforeseen happens—take, for instance, the unlikely happening of the present Government extending their own life—there will be a new Government in office on 1st April, 1971. There may be a change of Government or conceivably—depending on the swing of the pendulum—the same party may be in power. Who knows? I am not speculating—[Interruption.]—One of my hon. Friends says "John, John", as if I were doubting the return of this side to power. Politics is a curious game. Anything can happen.

What I am seriously saying is that no Government, no matter what their complexion, can consider themselves bound by a verbal statement of a Minister of a previous Administration. That is the crucial argument. Much though I believe the sincerity of the hon. Gentleman and the Government in making this statement, it is conceivable that a new Government could repudiate a verbal categorical statement. That is why we should like this proposal written into the Bill so that it binds a future Government who, should they want to alter it, will have to legislate in order to do it.

I appeal to the right hon. Lady the Paymaster-General to look at the new Clause seriously. The approach to the Bill has largely been an all-party approach. There has been no spleen, spite, or party-political bias about it. We have approached it, as far as I can see at any rate, in an all-party spirit. In consideration of this, I ask the right hon. Lady, because no future Government can be bound by the sincerity of the statement of the Parliamentary Secretary, to reconsider the new Clause and to write it into the Bill.

Mr. Douglas Houghton (Sowerby)

I really do not think that this matter is worth a lot of powder and shot. It is true, as the hon. Member for Burton (Mr. Jennings) has said, that this is the first time that we have had a Government pledge to review at the end of a specified period. In all the years that we tried to get that out of the Conservative Government on Pensions (Increase) Bills we failed. I mention this as a matter of historical fact, not in any spirit of reproach. We never got it, but now we have got it. But, of course, Oppositions always run true to form. They ask for something, they get it, but it is not enough.

"It does not go far enough" is one of the clichés which is used by Oppositions more than enough. I do not blame the present Opposition even for that. But let us look at this. We have a pledge given on behalf of the Government by the Minister in terms which seem to be very similar, if not identical, to the terms of the new Clause. One possible reason why the Government do not want to writs the Clause into the Bill is that by so doing they might tie the hands of a Conservative Government who are pledged to do something better. It would be a great encumbrance to a Conservative Government to be tied to what the Clause says when they want to do something much better and sooner. I think that out of consideration for the honouring of Conservative Party pledges the Government are withholding a statutory limitation upon their room for manoeuvre.

Another reason why it is perhaps not desirable to write the Clause into the Bill is that I hope that by 1971 the Civil Service will have done something more sensible about its conditions of service and superannuation arrangements. I can speak only for the Civil Service, because that is the Service in which, and for which, I have spent a great deal of my life. The real trouble about superannuation in the Civil Service is that serving officers do not take enough interest in it. If they had done, something much better than this could have been achieved years ago, and on the Second Reading of the Bill I gave some indication of what I thought might have been possible had the Civil Service taken this matter seriously in the past.

During the Second Reading debate we heard from my right hon. Friend the Paymaster-General about the setting up recently of a committee of staff interest and the Government, the Civil Service Department, to review the superannuation arrangements in the Civil Service in the light of the proposed new National Superannuation scheme and also in the light of the Fulton Report. As has already been suggested, the Fulton Report thought that some alternative to the legislative process should be found for dealing with changes in pensions and pensions increases. This, I am sure, is right.

A pension is part of the conditions of service and should, I think, be subject to discussion and negotiation as part of the conditions as a whole. Serving civil servants should know what they are setting aside for the future, and what price they may have to pay for it, what surrender of current consumption they may be asked to make to assure them of more adequate superannuation payments later on. These are matters which should be within the discussions on conditions of service in any body of workers today. Separating superannuation from everything else, treating it as a different matter entirely, making it subject to an Act of Parliament, and not subject to negotiations on the Whitley Council in the ordinary way is out of date. I hope, therefore that something different and better will emerge.

I hope that we are not going to be pressed to divide on a matter of this kind, the Minister having gone so far, because even if the Clause were written into the Bill it would not command the Minister to do anything except say something, and that does not seem to be worth legislating for. The Clause says that the Minister shall present a Report to Parliament specifying the extent of any such reduction, the pensions to which it applies and the action which he proposes to take. There we have a statutory provision that the Minister shall up and speak. If he ups and says to the House, "If you ask me what I propose to do about it, the answer is nothing", what will Parliament do? The Minister will not have broken his pledge literally, though he might have broken it in spirit. In any case, one does not want to pursue these matters to logical absurdity.

What greater guarantee is there in having a Clause of this kind in the Bill as against having a pledge given by the Minister? If we have a Labour Government after the General Election, this pledge will be honoured. If we have a Conservative Government, this or something better will be honoured, according to what the Conservative Party says. We are all honourable Members, and pledges are honoured if they are given. I think that Civil Service and public service pensioners can be satisfied with this as an assurance for the future, but I repeat that their future security on pensions would rest more firmly upon an agreed scheme of conditions of service and superannuation and on a specific declaration by serving civil servants of what provision they are prepared to make for the future of those who have gone on pension, knowing full well that it will be their turn next.

Captain Walter Elliot (Carshalton)

Over the years we have enjoyed listening to many speeches on this subject from the right hon. Member for Sowerby (Mr. Houghton), but I confess that I thought I detected a large tongue in his cheek when he seemed to argue that the Government were thinking of the next Conservative Government when he referred to this pledge. The Government are holding out this offer, but it may be—through no fault of their own—that it will never be honoured because they cannot honour it. I see the hand of the Treasury behind this pledge and the way it is put, and I feel that in the end we shall all be sorry for it, and that it may grossly mislead the pensioners.

I was a member of the Committee which considered the Bill. I do not want to detain the House for very long, or to repeat the speech that I made there, but we did not get the opportunity to comment on the Minister's summing up of our debate, and I should like to make one or two brief remarks now.

The Parliamentary Secretary uttered sympathetic words about a similar Amendment, culminating in this offer of the inquiry, but on reading his speech very carefully one sees that he used words almost identical to those which have always been used by Ministers in replying to the many debates that we have had on this subject, whichever Government have been on the benches opposite.

What it boils down to is that the Parliamentary Secretary expressed sympathy with everything we said, but then commented, "This is not the way to do it". We always get that, whichever Government are on those benches. In my view this is the way to do it, just as the Grigg Committee's biennial review is the way to deal with the pay and pensions of the fighting Services.

The right hon. Member for Sowerby seemed to question the value of a review. He said that the Minister would not be committed to anything, but if one looks at the various recommendations of the Grigg Committee over the years one sees that it has acquired such influence that it is always accepted. I submit that this is the right way. I detect the Treasury's hand behind its rejection.

In Committee it was most interesting to listen to the Parliamentary Secretary from the Ministry of Social Security replying to the debate—

The Parliamentary Secretary to the Ministry of Overseas Development (Mr. Albert E. Oram)

May I correct the hon. and gallant Gentleman? I am the Parliamentary Secretary to the Ministry of Overseas Development—which may be even more puzzling to the hon. and gallant Member.

8.0 p.m.

Captain Elliot

At any rate, the hon. Gentleman was replying on behalf of the Ministry of Social Security. I found that most interesting, because over the years, whichever Government have been in power, such debates have regularly been replied to by a Treasury Minister. That means that no question of social justice is considered; it is question of cash. The Treasury knows the possible cost of any recommendation which may be made. That is most important. We cannot ignore it. But we can get over the difficulty if the case for an increase in pensions is investigated at the same time as is the case for an increase of salaries for those still earning.

I realise that no Government can go on producing enormous sums of money, whether it be for those currently earning or for pensioners, but in the past the pensioners have always been the ones to suffer. Those currently earning scrape the barrel so that there is nothing left. When retrenchment is necessary the burden need not always fall on the pensioner. If their case is considered at the same time as the case for those currently earning, the money can be properly divided between the two. The Clause will protect the pensioner, and I very much hope that the Minister will accept it.

Mr. Eric Lubbock (Orpington)

The hon. and gallant Member for Carshalton (Captain W. Elliot) has made a very important point in submitting that instead of the biennial review proposed in the Clause pensions should be reviewed at the same time as are increases in salaries. I agree with him absolutely about that, but it is far too much to ask the Minister to accept that principle, known as "dynamism", which holds that the pensions of persons already retired should move in relation to the salaries of those currently earning. The new Clause is probably as good as we will get.

The biennial review may not take place at such frequent intervals as increases in salaries are made, but at least it would be an improvement on the frequency with which pensions increase Measures have been brought before the House. In the Second Reading debate the right hon. Lady reviewed the periods which have elapsed between successive Bills, and I need not go into that matter. It is enough to say that the minimum period has been about three years.

The Clause asks the Government to undertake such a review at slightly more frequent intervals, although not committing them to any action. As the right hon. Member for Sowerby (Mr. Houghton) has said, the Government might submit a report to the House and do nothing about it. But at least they would have an obligation to set out in black and white by how much the purchasing power of pensions had decreased since the previous review, and what action they proposed to take.

When such a report was presented to Parliament we would have our own remedies if no action were taken to have the matter debated. We could ask the Leader of the House at business question time every Thursday why he had not arranged for a debate on the very important subject of the report presented to the House by the Minister. We could table early day Motions—although I share the misgivings expressed by the hon. Member for Oldham, East (Mr. Mapp) on this point. He was right to point out that in a sense such Motions were a fraud on pensioners. It is something of a fraud to sign such a Motion knowing that when we tell our pensioner constituents that we have signed such a Motion, in practice it makes very little difference and has little effect on the Government.

I say that without prejudice to my admiration for the sponsors of such Motions, in doing whatever they can. Early Day Motions are only one of the means by which an issue can be drawn to the attention of the Government. I am in no way denigrating them, any more than was the hon. Member opposite, but in public we tend to over-emphasise the effect of such Motions on the mind of the Government.

As to whether the Clause should be voted upon, different views are held on both sides of the Committee. If assurances were given by the Parliamentary Secretary upstairs in nearly the same words as those in the Clause I cannot see why the Government should refuse to accept it. The hon. Member has given a pledge. I suppose that he spoke on behalf of the Government, although, if we examine the statements made by hon. Members opposite when they were in opposition immediately before 1964 we see that even statements made in the House—and even by such Members as the hon. and learned Member for Northampton (Mr. Paget) and the right hon. Member for Sowerby—are not necessarily regarded as a positive commitment by the Labour Party.

We want something more precise. I am not casting any reflection on the hon. Member who, I am sure, made the pledge in good faith, but in view of the past history of this matter I should feel happier if this provision were in the Bill, rather than that it should be left to us to quote what was said in Committee upstairs—to which very little attention is paid.

That is why I hope either that the right hon. Lady will accept the Clause—which would cost her nothing—or the official Opposition will press the matter to a Division.

Mr. John Nott (St. Ives)

I listened to the right hon. Member for Sowerby (Mr. Houghton) with great interest. He knows more about this subject than I am ever likely to know. But in raising the question of the failings of previous Conservative Administrations, he ought not to feel that this should inhibit any of my hon. Friends or myself from making good proposals for the future. He says that if the Clause were accepted it might restrict the freedom of manœuvre of a future Conservative Administration—but that is precisely what we want to do. We are anxious to give this proposal statutory backing in order to ensure that whatever Government are in power it will have binding statutory effect.

I was not fortunate enough to be a member of the Committee on the Bill but I have tried to follow the debates from the OFFICIAL REPORT. I want to refer to the Minister's comments at the second sitting of the Committee, before he gave his undertaking at the third sitting. Some days elapsed between the two sittings, and to some extent the Minister's off-the-cuff answer at the second sitting is rather important.

The Minister put forward two principal objections to the new Clause. First, he said that any new machinery set up should allow full consideration of the relationship between public service pensions and the new State scheme. Secondly, he said that anyhow an inter-departmental committee was already keeping this subject under review. The latter objection was fully covered by my hon. Friend the Member for Wanstead and Woodford (Mr. Patrick Jenkin) in Committee, when he said that all the Opposition were asking for was for the Minister to review, to publish and to state what he would do, and that that was as far as it went. Therefore, even if an inter-departmental committee is keeping these matters under review, there can be no objection to the new Clause because it does not commit the Government to payment.

But it was the former objection which made me most nervous. The public service pension is an occupational pension, and the Minister's objection raises the question of whether we are talking about entitlement or discretion. In Committee we were told that the pension itself is an entitlement but that the increases are a question of discretion. I wholly dissent from that view. Considering future pensions schemes, we must surely accept that there should be as much of a dynamic element in public service pensions as there is now for pensions in the private sector, and so I would regard increases in public service occupational pensions as a matter of entitlement and not discretion.

The right hon. Member for Sowerby talked about pensions being a part of service, and said that they should be come so and that increases should be automatic and outside Parliament's control. The trouble here is that the Government's scheme in the White Paper is as "pay-as-you-go" scheme. If he is suggesting that public service pensions should be incorporated in the new State scheme, I can only say that that would have a serious adverse effect on our financial situation, because many such pensions are funded, including the local authority ones, for instance—

Mr. Houghton

I was not suggesting that. Whatever happens to the Civil Service pensions scheme, which is non-contributory, it will have to be part of the occupational scheme of the Civil Service in the same way as those of teachers and local government employees and the rest and not brought within the scope of the State scheme.

Mr. Nott

I appreciate the point, and I agree that public service pensions should not be incorporated into the State scheme. If that happened, we should lose the funded element of a large portion of the present public service pensions. The "pay-as-you-go" scheme proposed by the Government is thoroughly irresponsible. For any Government to publish a White Paper committing themselves on a pay as you go scheme to an automatic increase in the State pension related to inflation is quite irresponsible. How the Treasury has allowed them to do so. I cannot conceive—

Mr. Lubbock

It is not for 20 years.

Mr. Nott

Perhaps it will not have its fullest impact for 20 years until 1991, but for any Government to commit themselves to fixing increases in pension over the next decades is irresponsible. The The new Clause does not do this. It requires only that the Minister should be bound to make a review and give the results to the House.

I am sure that everyone welcomes the undertaking which the Parliamentary Secretary gave. It is a great advance, and I would not detract from it. But the right hon. Member for Sowerby asked, "If the Minister has given an undertaking, why should hon. Members opposite require more?" With no kind of concern about what Conservative Administrations might or might not have done when in power, I would only say that for the public service pensioner there is a fundamental difference between a statutory undertaking in a Bill and a Ministerial undertaking. He would feel happy that this was a genuine advance if it were contained in an Act of Parliament. With the best will in the world, a Ministerial undertaking is quite different. The Parliamentary Secretary said in Committee that he accepted the objections put by my hon. Friend, but it still would be infinitely more valuable to the pensioner if written into the Bill.

8.15 p.m.

Then there is the question of the likely change of Government. The history of this matter since the war is one of back benchers of the Opposition and the Government ganging up on the Government of the day, who withstand the demands which they make. Since this is bound to continue, it must be better to have the new Clause as a statutory undertaking rather than have to rely on a Minister's undertaking now.

The new Clause meets three admirable objectives. First of all, it meets the Government's own criticisms of the present system in paragraph 100 of the White Paper. Second, it meets the points made in the Fulton Report. Third, it meets the Conservative Party's own election undertaking of having a biennial re view. To meet a Conservative pledge, a Fulton recommendation and a Socialist criticism all in one fell swoop—

Mr. Lubbock

And also a Liberal Amendment to the Pensions (Increase) Bill of 1962.

Mr. Nott

The Liberals are very fine people, but they are not of much consequence.

Mr. Mapp

The hon. Gentleman has just asserted, unwittingly I think, that this promises a biennial review. That was the case with a new Clause moved in Committee, but this one refers only to a review on 1st April, 1971, and does not promise a biennial review.

Mr. Nott

I accept the hon. Member's point, but to have a statutory review in April, 1971, is a greater step towards a biennial review than a Ministerial undertaking, as I think he will agree.

As I said, to meet a Conservative pledge, a Fulton recommendation and a Socialist criticism seems to be worthwhile, and I hope that the Minister will accept the new Clause in that spirit.

Sir Brandon Rhys Williams (Kensington, South)

One hon. Member said that we made a serious attempt in Committee to solve the problems of pensioners in a no party spirit, and that is absolutely true. It was an interesting Committee in which many important points were made; but we ended as much at sea as we had begun because we could never latch on to any principle to apply to the claims upon the present generation which the previous generation is trying to make. We all felt that there was some degree of obligation upon us to do something for public service pensioners, but we were not able in Committee to determine precisely what it ought to be.

Although no answer on questions of principle came out of Committee, my hon. Friends who were present felt that at any rate some degree of commitment had been accepted by the Government in so far as the Parliamentary Secretary gave what appeared to be a firm undertaking, as a result of which the original Amendment, out of which this present Amendment has arisen, with withdrawn. The wording of the new Clause is already so weak that its effect has been brought practically to vanishing point—and yet, we understand, the Government are not prepared even to commit themselves to this extent. Out of the Committee, therefore, came neither a principle nor a commitment. It seems to me as if all the time we spent upstairs was wasted.

I ask the right hon. Lady tonight to speak quite clearly and to make quite plain what is her position. When we are dealing with money we must be precise. Will she explain precisely why the Government have proposed these particular increases and how they relate these increases to the unfortunately continuing trend of rising prices? We are entitled to ask the right hon. Lady whether she considers that the increases proposed in the Bill are related directly to the cost of living.

If they are related directly to changes in the cost of living, then we must be a little more accurate in our consideration of these changes. For those on a relatively high standard of living, those on an average standard of living and those on a low standard of living, particular changes in prices have a different bearing. To use one set of percentages across the board, therefore, is not necessarily fair or related to any principle. Moreover, we understand that the Government are soon to bring out an old people's cost-of-living index, which will refer particularly to the items which old people need to buy. May we, therefore, be precise about what we mean when we talk about changes in the cost of living?

Will the right hon. Lady also tell us exactly how the National Insurance element is blended into the increases proposed in the Bill? I understand the Government's anxiety to reduce their total commitments. If they are increasing the amount of money paid to public service pensioners through National Insurance, they may well feel that they are not also obliged to give them money by increases in their pensions. But, once again, the principle must be established: is a public service pension an entitlement or is it related to need? If it is related to need, then it is understandable that changes in National Insurance now and in the future can be taken into account; but if it is related to entitlement, then National Insurance is also an entitlement—a different entitlement—and it ought not to be blended into this picture.

In the White Paper there occurs the splendid phrase that pensioners should be allowed to share in the nation's rising living standards. Will the right hon. Lady explain how the Bill relates increases in pensions to rising living standards and how she proposes they should be so related in the future? These are the questions which arise on this issue—how, by what index and how often changes are to be made?

There have been a series of these Bills—I do not know how many. On each occasion we have required pensioners' organisations to exert pressure, to state their claims, to make their case and to speak for themselves again and again. If we feel that what we axe giving them is theirs by right, it is unseemly that we should oblige them to mount this exercise again and again. Sooner or later Parliament, too, must grow tired of having to make these painful reviews. It seems it is not a question of defining precisely what the public service pensioners should have and making sure that they get it; it seems to be a question of listening to how loudly they shout—and that is the wrong approach. What we are admitting is that we are not concerned with what the pensioners' claims amount to; we are more concerned with what their votes amount to.

I hope that the Government mean what they say in the White Paper that in future there will be an automatic review every two years. But we have challenged them, on the first occasion on which it is possible, to apply the two years' principle—and they begin to shuffle their feet and to say, "We do not want to write it into the Bill". How will the thousands of pensioners affected by the Bill read that refusal by the Government?

This is not just a matter of party politics. It is a moral issue which concerns us all. We must ask ourselves, "When we become old, how shall we establish the basis of our claim on the generation who will have to pay for our pensions?"

Truth is said to be found at the bottom of a well. In this case it is probably found in the small print on the last page of the Government's White Paper, in which it is envisaged that there will be a relatively sharp increase in the contributions which are due to be made around the turn of the century in order to carry out the commitments in the White Paper. The question which our children will ask us is, "How did you treat your pensioners?" We shall have to say, "We did not commit ourselves. We did not like to go too far. We drove a rather hard bargain."

I do not think that this is very seemly. There is no wonder that the pensioners have ceased to trust the Government. The right hon. Lady will win the respect of the House and the gratitude of tens of thousands of people if she will speak unequivocally on these issues and prove her commitment by accepting the new Clause.

8.30 p.m.

The Paymaster-General (Mrs. Judith Hart)

The point which we are discussing on the new Clause has given rise to a great deal of concern on both sides of the House in the past—to both back benches, to my party now in power and to the Conservative Party when they were in power. The issue is one of trying to find a way in which we can guarantee to public service pensioners a share in rising standards, as the hon. Member for Kensington, South (Sir B. Rhys Williams) said, and, in particular, the right to have their pensions protected against changes in the cost of living over the years. It is significant that over the years, on all the Pensions (Increase) Bills, as hon. Members on both sides of the House will readily agree, no way has been found of avoiding the kind of Bill with which we are dealing tonight.

It is important that we should understand what arises in the context of this new Clause and what does not arise. My right hon. Friend the Member for Sowerby (Mr. Houghton) put very clearly the issues which arise and those which do not arise. Some of the arguments used in the debate have been more directed to matters which do not arise from the new Clause than to matters which do. We are not talking about guaranteeing that in April, 1971, there shall automatically be paid to public service pensioners any amount arising from a review. Some arguments have seemed to suppose that this were the case. It is not. Therefore, that is not what we are arguing about.

Mr. Hordern

Would the right hon. Lady say which hon. Member mentioned that argument? I have not heard it today.

Mrs. Hart

Two or three hon. Members—I think that the hon. Member for Orpington (Mr. Lubbock) was one of them—spoke in general terms of seeing the new Clause as a guarantee of moving towards an automatic system of biennial review such as is proposed in the White Paper on National Superannuation and Social Insurance.

I readily accept that if one were to guarantee automatic reviews it is likely that certain consequences would follow. But the Clause does not suggest, nor did the hon. Member for Horsham (Mr. Hordern) who moved and spoke to the new Clause in Committee suggest, that we should write into the Bill any payment to be due shortly after April, 1971. Therefore, we are not discussing that. Nor are we discussing, as the hon. and gallant Member for Carshalton (Captain W. Elliot) suggested, the acceptance or rejection of carrying out a review in April, 1971, because a clear undertaking has been given. Nor are we discussing an automatic payment following the review.

What, then, are we discussing? Primarily we are discussing the difference between an undertaking clearly given by the Government, and equally clearly given by Opposition Front Bench spokesmen, and attempting to write a good intention into a Bill. Hon. Members opposite would find it extremely difficult to discover precedents and examples in our legislation for writing merely good intentions into Bills. It is our custom to demand that our Bills should be specific and clear and we should be ready at the same time to accept serious undertakings.

My hon. Friend the Parliamentary Secretary to the Ministry of Overseas Development gave a very clear undertaking in Committee which I shall be happy to repeat tonight. At the same time, the hon. Member for Wanstead and Woodford (Mr. Patrick Jenkin) said during the second sitting of the Committee: My party committed itself in the 1966 Election … to a proposal for a biennial review."—[OFFICIAL REPORT, Standing Committee F, 6th February, 1969; c. 75.] He repeated that undertaking in one or two other contexts during the Committee's third sitting. I am sure that the hon. Gentleman will forgive me if I now make what will be the only party point that I shall make in this speech: that commitment emerged only after the Conservative Party left office, not during the years that it was in office. We know that the mind reflects very deeply when it is out of power, and it is understandable and welcome that the Conservative Party should have made that commitment.

The Government have given a firm commitment. The hon. Member for Orpington referred to the difficulty of commitments made whilst in opposition, and sometimes Governments fail in power to fulfil specific and detailed promises given while in opposition. However, he will agree that commitments made by a Government acting with advice and collectively and on the basis of responsible decisions made collectively are always to be regarded as absolutely firm. Therefore, he can only be doubting the undertakings made by the Opposition, who are out of power. But the Opposition are convincing us over and over again that were they to come to power by some mischance in 1971 they would fulfil the kind of undertaking which the Government have given.

I see no problem at all about the difference between an undertaking and writing a good intention into a Bill. Therefore, the hon. Gentleman's desire that the House should divide on the Amendment was somewhat misplaced.

Mr. Hordern

Can the right hon. Lady explain how an undertaking given by the Parliamentary Secretary can be translated into a good intention when that undertaking is simply transferred into the words of our new Clause?

Mrs. Hart

The words of the new Clause ask that it should be written into the Bill that The Minister shall … undertake a review … shall estimate the change … which has taken place "in the purchasing power of such pension" and present a report to Parliament specifying the extent of any such reduction, the pensions to which it applies and the action he proposes to take. At the end of the day all that is requested is that the Minister shall make a report to Parliament. The undertaking which has been given, which I gladly repeat, is that we shall review the change in the purchasing power of the pensions to which the Bill applies as at 1st April, 1971, and if that purchasing power has been reduced by more than 4 per cent. the Government will make a statement indicating the extent of the reduction in the purchasing power of the pensions and what action they propose to take.

The Government have given a clear and firm undertaking. It is an undertaking which many hon. Members on both sides of the House welcome because it means that for the first time there is something rather more than has been forthcoming when we have discussed previous Pensions (Increase) Bills. To introduce the new Clause would mean that Government undertakings made in such deliberate terms would no longer be respected. That would be a grave mistake for the House to make. Putting this into the Bill would take the matter not a bit further than the undertaking I have given, provided one accepts that both the Government and the Opposition will adhere to the undertaking. I have given my firm commitment that we will adhere to it and the Opposition for their part have clearly indicated the same.

Mr. Lubbock

The right hon. Lady is suggesting that one does not trust the Opposition if members of the Opposition should happen to be in power in 1971.

Mrs. Hart

My confidence that we shall be in power is such that I do not regard that as one of my major anxieties.

Mr. Nott

Is not the right hon. Lady skating on rather thin ice? Paragraph 101 of the White Paper clearly commits the Government to expressing their good intentions in a Bill. She says that under the new scheme the Government will be bound by the statement to review every two years. I cannot see an important distinction between that and what the right hon. Lady is saying.

Mrs. Hart

I suggest that the hon. Member reads the whole Bill and the White Paper. The difference is that the White Paper commits the Government to present a Bill to the House which will contain statutory provisions not merely for reviewing in the sense of the words in this Clause and following that by presenting a report to Parliament and stating the action the Minister proposes to take. The words of the paragraph indicate that the Bill will contain an undertaking to make statutory regulations. Had this new Clause said that the review must be followed by statutory regulations to be provided for in this Bill which will take account of whatever change in purchasing power over 4 per cent. has taken place, it would be a different matter, but that is not what we are discussing.

I turn to the relationship between this and the White Paper because it is clear, and I welcome this, that hon. Members on both sides have seen in the commitment given in the White Paper on National Superannuation and Social Insurance something which is extremely important to existing and future pensioners other than public service pensioners.

Mr. Jennings

I am sorry to intervene, but the right hon. Lady is going on to another subject. I should like to bring her back to her statement that neither the statement by the Parliamentary Secretary nor the new Clause guarantees a statutory increase after 1st April, 1971. I agree that the words in both do not say that, but both the statement and the new Clause are statements of good intention. Will she be frank and honest in considering the words if . . such purchasing power of more than 4 per cent. this is a norm which has been set in the statement— the Government will make a statement indicating both the extent of the reduction in the purchasing power of' the pensions and what action they propose to take. What does she mean by those words, what action they propose to take"? Is not the intention to make some compensation to the pensioners for the erosion by 4 per cent. of the purchasing power of their pensions, or is this just playing with words?

Mrs. Hart

What the words indicate is exactly what they say—that the Government then consider what action they propose to take. The House should remember that as statutory provision is not written into the Bill for regular reviews every time it is necessary because of changes in purchasing power or whatever to increase the level of public service pensions, we must have a Bill of this kind. Therefore, we must bear in mind what legislative time is available for a new Bill. We have to consider at precisely what point of the Parliamentary year the Bill is introduced, and so on. These considerations must necessarily be allowed for in terms of Government undertakings, which have to be fulfilled by actual legislative time and by Bills. This is why I cannot be more specific.

Here is where I relate this to the White Paper and to the biennial review as it is proposed in the White Paper. [Interruption.] I must be allowed to make this complete point because the two are inter-related. The White Paper contains a proposal, which is being welcomed by both sides, for an inflation-proofing biennial review with statutory powers [Interruption.] I understood that it had been welcomed in many quarters, and I understood that most of the remarks this evening directed towards the desirability of a regular review of public service pensions to some extent at least derived from, and had certainly referred to, the proposal for biennial reviews made in the White Paper. If the Opposition are arguing that they are against biennial reviews for ordinary pensioners—[HON. MEMBERS: "No."] Then I do not understand the point of the intervention.

Mr. Patrick Jenkin (Wanstead and Woodford)

The point of the intervention is perfectly clear, and it was made by my hon. Friend the Member for St. Ives (Mr. Nott)—that there is all the difference in the world between a review which results in a report on which the Government have a discretion to act, which is what the Clause is asking and which in relation to public service pensions is all that my party has ever pledged itself to, and what is written into the White Paper, which gives the promise, as I understand the matter, of automatic adjustment of National Insurance pensions so as to compensate for the rise in the cost of living. On that I do not want to say more than that we have not yet accepted the point as the right hon. Lady sought to put it a few moments ago. No doubt we will be debating the White Paper and it will be for the spokesmen on behalf of my party to state definitively what the attitude of the Opposition is; but it is not as the right hon. Lady has said.

Mrs. Hart

I am glad that we have that clear. What is clear to me now is that there is considerable confusion of thought among hon. Members opposite. The hon. Member for St. Ives (Mr. Nott) interposed to ask—this was the tenor of it; I do not get the words correct—whether it was not clear that, if the Government review in the field of public service pensions discovered that the cost of living has risen by more than 4 per cent., they would be bound to carry that into effect; and what was the difficulty about the Government now giving an undertaking that they will do so? That is precisely the kind of commitment that we are making in relation to other pensioners in the White Paper—that the review will automatically be followed by statutory regulations.

Therefore, there is some confusion and difference of view amongst hon. Members opposite as to what exactly people want, both in relation to ordinary pensioners and in relation to public service pensioners.

Mr. Nott rose—

Mrs. Hart

If I give way to the hon. Member, he will merely confound the confusion on this point or will reveal it at even greater depths.

8.45 p.m.

Mr. Nott

The right hon. Lady said that I ought to read the whole of the White Paper, which was a little pejorative. There are two specific points made in paragraph 101. There is certainly the point which says that the Government commit themselves to give inflation proofing. But there is also the second portion of paragraph 101 which says that the actual amount of improvement on each occasion beyond the inflation proofing must be left for decision by the Government of the day. It was to that that I was referring when I said that there is not much distinction between what we are debating now on the new Clause and this sentence in the White Paper.

Mrs. Hart

I think the hon. Gentleman has slightly confounded confusion in terms of his own Front Bench, because that is not quite what his own Front Bench was saying a few moments ago. He will find, if he discusses it with his Front Bench spokesman, that there is a degree of difference between the two of them as to what they have said tonight in relation to the White Paper.

May I relate what I have just been saying about that paragraph in the White Paper to what we are discussing here in terms of this new Clause? Clearly, this is a major new departure that is presented in the White Paper—a statutory biennial review. Clearly, this has great bearing on what we would like to see in the future for public service pensioners. It seems to me that the position really is as follows. Within two weeks of the publication of the White Paper and, as the hon. Member for Wanstead and Woodford said, before it has been discussed in the House of Commons, we are being asked here to write into a public service pensions Bill something the implications of which, as hon. Members opposite have clearly said, would involve the kind of commitment that the White Paper envisages. That is despite the fact that the whole relationship between the proposals in the White Paper and the future working of public service pensions must now be the subject of a great deal of detailed work in depth.

As my right hon. Friend the Member for Sowerby said, there will now be a review in considerable depth of the Civil Service superannuation scheme in relation to the occupational pensions and their relationship to the National Insurance pension proposed by the White Paper. This is one clear area of deep study that is now being undertaken and must now proceed. It is most important that it does. Simultaneously with that we have the Standing Inter-departmental Committee, to which my hon. Friend referred in Committee upstairs, which carries out its review of public service pensions. Here again there will be a relationship between the two. It is an indirect one, but all the processes must now be gone through.

Concurrently with the examination of the White Paper, now to be examined by all of us, will be the study of the Civil Service superannuation scheme in relation to the proposals in the White Paper, and concurrently with that will be the study which will be made by the Inter-departmental Committee whose job it is to consider public service pensions, which again must be to some degree at least in relation to the Civil Service superannuation study. There are certain links between them.

Therefore, it would not be right if we were to go beyond the proposition that a clear undertaking is given by the Government to review the public service pensions in April, 1971. To this extent I agree with the hon. Member for Wan-stead and Woodford when he said in Committee that he would not want to write into the Bill a requirement to increase the pensions following the review. We are at least agreed on that, even if some of his hon. Friends seem a little uncertain about this point.

We come back, therefore, to the proposition that a Government undertaking to review should be regarded by the House as a great step forward. It was welcomed in Standing Committee. But to go further would be to make assumptions about the new thinking and new work which is now to go on in this whole subject following publication of the White Paper. The Opposition are not being reasonable if they press the new Clause. They have the undertaking. It will be honoured by us. I am certain that hon. Members opposite fully intend us to believe that their party would honour it. The undertaking being given, no one can reasonably want anything beyond that. The difference lies merely in whether it should be written into the Bill.

What is of importance to public service pensioners, looking to the future, is the work now going on, which, I hope, will ensure that we can avoid having to come to the House from time to time, whichever party be in power, with a Bill of this kind. We want to replace that system with something much better, with something which guarantees to the public service pensioner regular increases when he ought to have them. Precisely how that should be done it is too early to say at this stage, but I believe that we can within a reasonable time, on the basis of the work which is being done, find a way to devise a new and better system.

Mr. Patrick Jenkin

The right hon. Lady has done her best to throw dust into the eyes of hon. Members on both sides in attempting to confuse a simple issue. The question, as she herself said at one point, is whether we should write into the Bill as a statutory obligation an undertaking which her hon. Friend the Parliamentary Secretary gave to the Standing Committee. I say that the right hon. Lady attempted to throw dust in our eyes because she brought into the argument to an extent which seemed merely to confuse the issue the obligation which the Government set out in paragraph 101 of the White Paper.

The hon. Member for Oldham, East (Mr. Mapp), who was a doughty champion both on earlier occasions and in Committee for the proposition that public service pensions should be reviewed every two years, gave as his reason for not wishing to write the undertaking into the Bill his belief that the matter was bound to be discussed in the context of the White Paper. Yet, as I understood one part of the right hon. Lady's somewhat confusing speech, her reluctance to see the undertaking written into the Bill stemmed not from the reason given by the hon. Member for Oldham, East but from, as it were, an entirely different point, namely, that to do so would appear to give the impression that the Government were undertaking an obligation comparable with that set out in paragraph 101, whereas, as she told the House, both she and I had made clear on previous occasions, and on this, that there was no such intention.

Let us put the question of the White Paper out of the way once and for all. It is yet to be debated in the House. My party's attitude is yet to be definitively stated. However, even at this stage, we are, to put it no higher, extremely doubtful of the wisdom of any Government undertaking a scheme of National Insurance and writing into it, as the Government have apparently done in the White Paper, not only an auto- matic review but an undertaking automatically to grant cost-of-living increases in the light of the review. We do not seek that for public service pensioners, and have never sought it. My hon. Friend the Member for Burton (Mr. Jennings) has pressed over and over again that Governments should accept such an obligation, but I do not believe that it would be a responsible attitude for any Government to accept it in relation to public service pensions.

It would not surprise me if, when we debate the new White Paper, a similar view is expressed from this side of the House in relation to the obligation the Government have written into paragraph 101. The most we have ever said—and, like the right hon. Lady, I repeat it again—is that we would undertake a biennial review of public service pensions to see to what extent their purchasing power had been eroded by inflation since the date of the last increase.

The question, therefore, comes down to whether we should write the undertaking into the Bill, even in the truncated form in which it was finally given by the Parliamentary Secretary of merely having one review in April, 1971, two years after the operative date under the Bill. The argument for this was put by a number of my hon. Friends. Basically, it was that this was an obligation which now rested on the Government, that there was no reason to believe that it would not be honoured by them, and that therefore they could perfectly well accept it in the Bill, where it would not only bind the present Government but their successors.

The right hon. Lady, on the other hand, put the argument that what she called a clear and firm undertaking having been given and repeated on the Floor of the House, which we welcome, it would merely become a good intention when it was put in the Bill. That frightened me. I wondered, "Are the Government, having given an undertaking in the words of the Parliamentary Secretary in Committee, now writing it down to the status of a good intention, so that if it were included in the Bill it would be merely a statement of intention, which was fully and honestly intended at the time, but which any Government would feel entitled to resile from if the conditions changed?"

Mrs. Hart

The words "good intention" refer to the payment which would need to follow the review. It was made clear by hon. Gentlemen opposite that we have no point of difference on this.

Mr. Jenkin

I am sorry if I misunderstood the right hon. Lady. Hon. Members will be able to study HANSARD tomorrow. It did not appear to me that the words "writing into the Bill a good intention" had anything to do with the question of payment of an increase but merely the question of the reviewing and reporting to Parliament.

Mrs. Hart indicated dissent.

Mr. Jenkin

If the right hon. Lady shakes her head, I accept her explanation and will rely on that. Is it really to be said that to take an undertaking which has been given in Committee and to enshrine it in statutory form in the Bill, so that it binds both the present and successive Governments, is, as she put it, a writing down of Government undertakings? I find that a very strange proposition.

Mr. Lubbock

Is not it a rather curious doctrine that no assurances given by the Government in Committee can ever be written into the Bill in case that might cast doubt on their validity? Will not this mean that we shall have some more yawning gaps in future legislation?

Mr. Jenkin

I entirely agree. I do not understand the right hon. Lady's philosophy in this matter. She says that the undertaking has been given by the Government in Committee and repeated by her on the Floor of the House, that it stands on the record and will be honoured by the present Government, and that their successor, which will surely be a Government formed by my party, will honour it, and therefore it is unnecessary to include it in the Bill.

An argument that she did not make was that it would clutter up the Bill with unnecessary Clauses. That is an argument that we have had often enough on other Bills, such as the Selective Employment Payments Act, for which Clauses were refused on the grounds that they would clutter up the Statute Book. If the words were refused on the grounds that they would be cluttering up the Statute Book, that would be an argument to which some weight might be given. However, the argument which was put was that it would be a statement of good intention if it were put in the Bill, a statement of good intention, as the right hon. Lady now says, about the payment of increases. Alternatively, it would be a general writing down of the Government's intention. These are arguments I simply cannot accept.

9.0 p.m.

My hon. Friends have been entirely right to debate this new Clause and the undertaking which was given by the Parliamentary Secretary, and to make it abundantly clear where both the Government and the Opposition stand in this matter. I will briefly restate the position. It is that two years after the operative date in the present Bill, the Government, whichever Government it may be, will undertake a review of the pensions to which the Measure applies and will ascertain to what extent, if any, the value, the purchasing power, of the pensions has fallen by more than 4 per cent. since the date of the last increases, and will then present a report to Parliament.

This is the obligation which, as I understand it, rests in honour on both sides of the House. It is an obligation which I feel absolutely certain will be carried out at any rate by any Administration it will be my honour to support. The right hon. Lady is nodding assent, and I have no doubt that she is echoing my words and applying them to any Administration which she will support or of which she may even be a member.

That being the case, the question finally comes, do we need to write this into the Bill? I would be happier to see this in the Bill. I have no doubt at all that I would be much happier if this were in the Bill. If I felt there to be any doubt about the bona fides of the pledges which have been given by the Government I would have no hesitation in calling upon my hon. and right hon. Friends to—as it were—nail the marker to the mast by dividing in favour of this new Clause. However, the right hon. Lady has committed herself hip and thigh, hook, line and sinker, on this matter, and it seems to me that she, like myself, is under the strongest obligation of honour to observe this, and in these circumstances I think it would be wrong that I should ask the House to divide on the new Clause. However, it is sufficiently important to justify the Amendment not being withdrawn. I think it would be better that it should be left to be negatived.

Question put and negatived.