PROVISIONS WHICH MAY BE INCLUDED IN CERTAIN REGULATIONS (Hansard, 16 December 1971)

§ Mr. Booth

I beg to move Amendment No. 8, in page 29, line 8, leave out 'recoverable or'. 990 The Amendment deals with a subject about which we expressed grave worries in Committee, so the Government are not unfamiliar with what inspired it.

The Amendment would take away from the Secretary of State power to make a regulation to reduce a pension or benefit by an amount calculated by reference to damages recoverable but not recovered. We are not relying on difficult legal interpretations. In any case, I have had the Amendment independently legally examined.

The cause of concern relates to two problems, and I should like to deal with the lesser first. It concerns the legal definition of recoverable". The officer responsible for administering the regulation might be advised that, say, a local government officer or other employee injured by a third party in the course of his job or in an accident while he was travelling to or from his work was entitled to recover £3.000 by way of compensation. It would he open to the officer administering the regulation to say that that was the amount recoverable although the accident victim might secure only £1,000 in court. There would be no guarantee that that £1,000 would be the amount upon which the reduction of his pension or subsequent benefits was calculated because it would still be arguable that a higher amount was recoverable.

The graver of the two worries arises from the not uncommon circumstance of somebody who successfully pursues a claim in court not being paid. Often someone wins a substantial award but the person against whom the damages are claimable cannot pay. A case in point was that of a trade union member, a member of an insurance company staff, who died within 24 hours of a road accident, leaving a widow and six-weeksold child. The widow was advised that she could without any difficulty win a claim against the driver of the car that killed her husband. In fact, he went to Durham Gaol and would not have been able to pay a quarter of the sum which would have been awarded against him, and therefore, the case against him was not proceeded with. There are other cases, few up to now, but who can say what will happen when someone wins a claim against a person who is insured but whose insurance company goes bankrupt? We had a recent example.

991 Both those instances show that there is no guarantee that the amount recoverable will be the amount recovered. We were assured in Committee that the Minister would never intend that anyone should have his pension rights calculated on the basis of an amount recoverable that was not recovered. If that is so, I can see no reason for including the words that we seek to delete. If it is not the intention to calculate any future pension reduction on the basis of an amount recoverable but it is the intention to calculate it on the amount recovered, surely it would be sensible to take these words out of the Bill. To add to the hardship of failing to obtain damages the additional penalty of a reduced pension is totally wrong.

We are not here dealing with a small number of people. I have taken the trouble to check with a union which represents a large number of local government officers, and the union is handling about 1,000 claims for damages in a year. A number of people who are, unfortunately, injured in the last few years of their working life may retire prematurely. People in the last few years of their working life are killed and leave dependants. For these people not only to run the risks inherent in legal proceedings for damages but simultaneously to run the risk of having a reduced pension is wrong.

It is perfectly fair that, where substantial damages are recovered, if the pension scheme is such as to provide insurance rights so that the pension is made up over and above that which is secured in damages, this should properly be written into the scheme. What is unjust and intolerable is that a person or a dependant should not only be deprived of the damages which the court has said should be his, but at the same time, should have his pension reduced by the amount which cannot be secured, and this cannot be the Minister's intention. It may be that the draftsman has not had a proper regard to what was intended. The Government must meet us on this point so that we can be clear about their intention.

§ Mr. David Howell

The hon. Member for Barrow-in-Furness (Mr. Booth) has put before us his two worries arising 992 from the inclusion of the words "recoverable or" in the Schedule, and has given us a particular example from which one of his worries springs. My right hon. Friend would not regard moneys as recoverable where patently they were not, but, even so, I see the validity and the tragedy of the case the hon. Gentleman has described, and I accept and understand his worries.

In Committee the right hon. Member for Sowerby (Mr. Houghton) volunteered to think further about this and made some rather perceptive remarks. I also undertook to think further about it, and I have had the opportunity outside the House to reflect on the matter. As the hon. Member for Barrow-in-Furness knows, I have also had the opportunity to explain the Government's thinking at some length.

Despite that, I take it that the words of the hon. Gentleman, who has obviously done a lot of hard and patient work and has gone into this deeply, mean that, notwithstanding our reflections and my explanations, there is continuing unease about this problem. We have asked ourselves whether we could manage with the reduced power. Our legal advice is that we should just about be able to get by in meeting immediate needs in the National Health Service, the only place where there is a Schedule 3 scheme of this nature. So, in the circumstances, I accept the Amendment.

I hope that it does not sound churlish if in so doing, I carefully dissociate myself from some remarks of the hon. Member in Committee about the iniquity of taking powers that it is not intended to use. As I explained on Second Reading, the main purpose of the Bill is to avoid the need for further primary legislation and thus to take wide powers, although with significant and valuable safeguards for the staff interests. That said, I am happy to accept the Amendment.