HC Deb 09 June 1972 vol 838 cc865-84

VOLUNTARY PARTICIPATION BY HOLDERS OF MINISTERIAL AND OTHER OFFICES

11.15 a.m.

Mr. Arthur Lewis (West Ham, North)

I beg to move Amendment No. 1, in page 2, line 30, leave out from '1972' to end of line 31.

The Temporary Chairman

I think that with this Amendment it would be in order to take the following Amendments:

No. 2, in page 2, line 34, after first 'of', insert; 'Lord Chancellor, Speaker of the House of Commons';

No. 3, in Clause 3, page 3, line 30, leave out 'being' and insert: 'and from each payment of salary to the Lord Chancellor, being, in either case';

No. 4, in page 3, line 39, leave out subsection (3);

No. 5, in Clause 4, page 5, line 6, leave out subsection (4);

No. 10, in Clause 7, page 7, line 42, leave out subsection (2);

No. 20. in Clause 9, page 9, line 30, leave out subsection (2).

Mr. Lewis

The Bill as it now stands, and without these Amendments, would enable the office holders mentioned to have the right to a supplementary pension on top of the normal pension paid to Members of Parliament. The Leader of the Opposition, the Opposition Chief Whip and the Deputy Whip, and officers of the House would all have, in effect, supplementary pension at their higher income rates. I shall have some more to say on that in a moment.

Strangely enough, the Clause, as it stands, excludes, and specifically excludes, the Prime Minister from this opportunity. I am at a loss to understand why the Prime Minister is not to be allowed the same opportunity as all those I have mentioned; that is to say, every Minister of the Crown, every officer of the House, the Leader of the Opposition, and all those office holders who, by the way, are not specified in the Clause but are listed in Part I of Schedule 2 to the Act.

[Sir ROBERT GRANT-FERRIS in the Chair ]

They will be able to draw a pension on their higher rates of pay, but the Prime Minister will not. I cannot see why the Prime Minister—this also applies to Mr. Speaker and the Lord Chancellor—should not have the opportunity of the supplementary pension based on earnings. My Amendment will put the Prime Minister on the same basis as everyone else. I want the principle to be established for later purposes.

The Prime Minister, the Lord Chancellor and Mr. Speaker all have a pension, and a very handsome pension, on a non-contributory basis. Immediately they take office, and if they hold office only for one day, they qualify. The Lord Chancellor does not have to hold the office for one day. He can swear the oath of allegiance and accept the seals of office, and he can then immediately retire and draw his pension of £7,500 a year, which has been increased from £4,000 under the proposals. This is quite a handsome pension. Some might say that it was too handsome, especially when we consider that the railway men, working all hours, are told not to ask for more than 12½ per cent.

I believe that the Prime Minister would welcome the opportunity to contribute to the pension fund. I have no personal feelings in the matter against the present Prime Minister because it would not operate exclusively against him. He is holding the position only temporarily and, I hope, will not hold it much longer. It would also apply to my right hon. Friend the Leader of the Opposition when he becomes Prime Minister.

I want to ascertain how and why all hon. Members and every office holder past, present and future are, quite rightly, expected to contribute while these three gentlemen have a non-contributory pension. I am willing to do a deal with the Parliamentary Secretary and withdraw my Amendment if he will give an assurance that everyone will be treated in the same way as the Prime Minister, Mr. Speaker and the Lord Chancellor. It is not impossible, because it happens in the Civil Service. Civil servants get their pensions on a non-contributory basis. It is argued that they get their money from the State in the first instance and there is no point in pro rata reducing the amount they would have earned in order to pay for their pension.

But hon. Members have been in that position for years. For years their salaries have been inadequate and for years they have not had the opportunity to contribute to a reasonable pension scheme. It is wrong that three selected persons should have their pensions doubled and kept on a non-contributory basis when they are well able to afford to contribute. The Prime Minister, for example, does not have all the normal expenses that face railway men. In addition to the £14,000 or £15,000 a year, Prime Ministers have two houses, servants, free heat and light, cars and chauffeurs. They also have "meals on wheels", so to speak, in that they have their food supplied. All they have to provide are the suits they wear, and even some of their clothes are provided.

11.15 a.m.

The poor ex-Ministers and present Ministers can and do contribute to their supplementary pension, so why should the Prime Minister be excluded from this provision? My proposal would be doing him a favour. Under the present arrangements his pension is limited to £7,500 a year, which is rather inadequate for him. If he were in the same position as Ministers and ex-Ministers, he would have the right to contribute to a supplementary pension which ultimately would provide him with a higher pension than he would otherwise draw. But he would have to subscribe and to meet the same conditions as ordinary back-benchers and he would have to serve four years under the new arrangement, qualifying for pension on an incremental basis so that it increased according to his length of service. It is surely reasonable and fair that he should be treated in exactly the same manner as ordinary back-benchers.

My second Amendment applies a similar argument to the Lord Chancellor and Mr. Speaker. These two gentlemen do not usually hold the job for long. Mr. Speaker is elected by the House and there is a tradition that, provided that he does the job satisfactorily, he will automatically be re-elected by arrangement through the usual channels. I know that in theory any hon. Member could oppose him and theoretically he could be defeated, but I do not know of that happening in recent years.

The Lord Chancellor, Mr. Speaker and former Prime Ministers are not prevented from taking other work when they begin to draw their pensions of £5,500 a year and £7,500 a year. When Mr. Speaker Morrison took a job as Governor of Australia, he got that job and his pension, too. There was a great outcry in this House, and as a result Mr. Speaker Morrison gave up half his pension and had his salary for the job in Australia. Then there was the interesting case of Lord Kilmuir, who was known when in this House as Sir David Maxwell Fyfe. He held the job of Lord Chancellor for a short time, went out on pension, and took a highly-paid job with Plessey's at £10,000 a year, which he had on top of his pension. Again, there was a great outcry.

Mr. John Hall (Wycombe)

Would the hon. Gentleman not agree that the great part of that money would have come back to the State in the form of surtax?

Mr. Lewis

Then let us give the railway men £100 a week and let it go back in surtax. If that happens, the railway men will continue proper working tomorrow and they will be paid to do it. The hon. Member for Wycombe (Mr. John Hall) puts forward a phoney argument. The poor railway men, dustmen and nurses cannot get an extra few pounds a week, but when it comes to Dick Marsh, Chairman of the Railways Board, it is decided that he shall get another £80 per week on top of his present salary of £400 a week. But this will not be announced yet because it might upset what the Government want to happen with railway salaries. The hon. Gentleman is suggesting that Dick Marsh will get only £15 out of the increase by the time he pays tax. The hon. Gentleman helps me in my case. That £15 or £20 extra is exactly the minimum on which railway men have to live.

All these gentlemen covered by my Amendment are able to go out and earn money in addition to what they are to get under the Bill. I do not object to that, whether it be writing their memoirs or whatever else they may be doing. I object on occasions when they go into print and attack their comrades. The place to do that is on the Floor of the House, quite openly, so that they can be questioned and given the chance to answer. I feel that these attacks are made almost deliberately with the aim of promoting the sale of the books. Certainly they do not write these works to help history or the political parties of which they are, or were, members. The main reason is to get fabulous incomes.

We are told that some of these ex-Prime Ministers—Prime Ministers of both parties—get £250,000 out of these books. I do not object to that—let them have the money—but let us not prevent them contributing to their pensions of £7,500. This is what must be remembered when we are considering the railway men. The old-age pensioner may have his pension reduced pro rata and I suggest that this same principle should apply to those gentlemen covered by my Amendment. We must be fair, and be seen to be fair, to everyone so that everybody is treated alike.

I have been attacked over a period of 27 years in my campaign for salaries and pensions because I have asked difficult questions which might be embarrassing to Governments of both parties. I have not worried about criticism because I believe it is not right that there should be preferential arrangements.

The Lord Chancellor's pension of £6,250 has just gone up to £8,500. That is not a bad pension and it could be given for one day's work. The man concerned just has to swear in, or kiss the Queen's hand, and then once he goes he can draw his £8,500. Then, if he wants to do so, he can take a job with Plessey or some other big concern. If he receives £10,000 a year salary at that job, I agree with the hon. Member for Wycombe that the Chancellor of the Exchequer will claim back some of it in surtax and income tax, but the ex-Lord Chancellor will still be left with quite a nice nest egg.

The object of the Amendment is to give these gentlemen the chance to come into the scheme on a contributory basis. Let them contribute out of their income for pensions, for they can afford to do so.

The Lord Chancellor recently had a 38 per cent, increase in salary and the Speaker a 53 per cent, increase. Yet we are telling the railway workers that 12½ per cent, is inflationary. In these circumstances perhaps the contributions by those gentlemen who have received these large increases might help to stave off some of the inflation. It appears that inflation occurs only when the lower-paid workers get extra; it never happens when the higher-paid man gets an increase. That has never been my view.

The right hon. Gentleman the Prime Minister will have a pension increase amounting to 87 per cent. The poor old Lord Chancellor does not do so well; he gets only a 36 per cent, increase. In comparison, poor old Mr. Speaker is shabbily treated and receives only a 30 per cent, increase in pension. This is not right.

A little later, if the Minister, as I suspect, does not agree to these Amendments, I shall argue that if it is good enough for these three gentlemen to have their pension on a non-contributory basis, it is good enough for all the rest of the Members of the House of Commons to be on a non-contributory pension basis in the same way as the Civil Service and others. These are sensible and useful Amendments which I ask the Government to accept.

11.30 a.m.

Sir Robert Cary (Manchester, Withington)

The hon. Member for West Ham, North (Mr. Arthur Lewis) has raised some important issues. Comparisons are odious and sometimes invidious and I shall leave my hon. Friend the Minister to answer the case on the first Amendment.

I ask the hon. Member for West Ham, North to bear in mind one important fact. In the main, he has been talking about great offices of State which carry considerable position and privilege in addition to the advantages in terms of emoluments referred to by the hon. Gentleman. I believe that that position should be preserved. However as in any other case, the large sums to which the hon. Gentleman refers, whether they be in terms of salary or pension, are subject to tax. Our system of taxation is such that a considerable amount automatically goes back to the Treasury. It does not matter whether we are discussing a substantial pension or any other resources which may flow to a former great officer of State from writing his memoirs. Vast sums will find their way to the Treasury under our present taxation system.

I believe that it is invidious to make comparisons between the pensions paid to high officers of State and those paid to most other members of the community who have to live on modest incomes. I ask the hon. Member to keep in mind constantly the fact that the holder of the office of Prime Minister or of Speaker of the House of Commons lives in quite a different world from that of the Private Member. I want to see the world of the Private Member preserved. He is a free man, whereas those whom the hon. Gentleman has been discussing are not free men in that sense.

I consider that one of the greatest privileges in Parliament is to be a Private Member. On that basis, I welcomed the contributory scheme when it was first introduced under the Lawrence proposals, as distinct from the benevolent scheme of which I was one of the architects and founders. As Private Members, at long last we had a contributory scheme to support our pensions. I do not want to be unfair to the hon. Gentleman, but I must remind him that the emoluments of Private Members were considered when it was known that we should have to pay some part to the pension scheme.

I plead with the hon. Member for West Ham, North, to do all that he can not to impede the progress of this Bill. It has many splendid qualities and benefits.

Mr. Arthur Lewis

The hon. Gentleman is talking about the Bill. However, we are discussing a group of Amendments designed merely to limit the pensions of three individuals, pensions to which they make no contribution, and to put them on a contributory basis with the result that they will get better pensions on the same basis as other Members of Parliament. That is all that we are discussing.

Sir R. Cary

I take the hon. Gentleman's point. However I prefer to leave matters as they are framed in the Bill, despite the hon. Gentleman's plea. I want to see the benefits remain as they are under the terms of the Bill. I say that because for the first time in these matters we have provision for a review. There will be opportunities under the system of review to look at these matters again—

Mr. Lewis

The hon. Gentleman should have told Lawrence that.

Sir R. Cary

Under the Lawrence proposals we did not have what amounts to an automatic review. Under the Boyle proposals we are to have an automatic review. This Parliament has about another 2½ years to run, and I envisage that in the spring of 1974 some of these provisions may be reviewed again.

I plead with the hon. Member for West Ham, North, not to press his Amendments too hard. Some of the matters that he has in mind can be dealt with at a later stage, possibly in 18 months 'or two years' time.

Mr. William Hamilton (Fife, West)

The hon. Member for Manchester, Withington (Sir R. Cary) has a very good record in dealing with matters concerning Members of this House, and my hon. Friend the Member for West Ham, North (Mr. Arthur Lewis) has taken an aggressive interest in them over a similar period of years. However the public at large will be astounded by the figures that we are discussing when we are dealing with the great offices of State. Over several years we have heard a great deal about the widening gap between this elected assembly and the outside public, and I believe that we should think very carefully before taking any steps concerning our own pecuniary interests to widen that gap still further.

It is right that there should be reasonable pension provisions for Members of this House and their dependants. But I have always thought that both major parties were wedded to the principle of a contributory pension scheme. I agree entirely with my hon. Friend the Member for West Ham, North. I cannot see why we should exclude from the contributory principle certain of the high offices of the Houses of Parliament—because we include the Lord Chancellor.

The only argument adduced in previous years to justify it is that the Speaker, the Lord Chancellor and the Prime Minister are not in the same situation as the ordinary Member of Parliament since they cannot take outside jobs while they hold their offices.

Mr. Arthur Lewis

Neither can other Ministers.

Mr. Hamilton

My hon. Friend anticipates my argument. It is said that the Lord Chancellor, the Speaker and the Prime Minister cannot have outside business interests so long as they hold office and, therefore, that that should be taken into account when we consider how to provide them with pensions. However, as my hon. Friend points out, that applies to other Ministers, and they do not get pensions on a non-contributory basis.

I do not see why anyone should be excluded. Moreover, I think it is an absurdity that the Lord Chancellor literally can take office one minute and resign the next. My hon. Friend spoke about the Lord Chancellor holding office for a day. But he can resign within a minute of taking office—

Mr. Lewis

My hon. Friend is wrong. I think that the Lord Chancellor must have kissed hands and accepted his seal of office. That might take him a day. I think that my hon. Friend should extend the minute to 24 hours.

Mr. Hamilton

These acts can be performed expeditiously. It could be done in less than a day. The Lord Chancellor can hold office for less than 24 hours. resign, and then automatically get a pension of £8,500 a year, following which he can go into the City. I do not want to be too personal, but let us consider the present Lord Chancellor. He is a very eloquent man, both with his tongue and his pen. He could have resigned after 24 hours and gone away to write his memoirs. Lord Hailsham's memoirs would be worth reading; they would make a best seller.

Mr. Lewis

A quarter of a million.

Mr. Hamilton

A quarter of a million would be chicken feed for this man. He could also go into the City and take jobs with Plessey, Shell, BP, or whatever, and make five and six figure incomes in addition to the £8,500 pension that we are giving him.

I become worked up when I compare that kind of treatment with the treatment we are meting out to millions of our citizens. My hon. Friend the Member for South all (Mr. Bidwell) and I are serving on the National Insurance Bill Committee. Let us compare the £8,500 pension of the Lord Chancellor after less than 24 hours' service with the provisions in the National Insurance Bill—for example, the invalidity allowance for men or women who are incapacitated at the ages of 35, 45 and 60. What are we giving them? If a man is incapacitated before the age of 35 we give him an additional 15p a week, roughly 750p in a year—£7 10s. in old money—compared with £8,500 pension for a Lord Chancellor who can hold office for less than 24 hours. If a man is incapacitated at the age of 60 we give him a weekly rate of 35p—in old money, seven bob a week.

We talk about the gap between the treatment of ourselves, whether we be back benchers or the officers to whom my hon. Friend the Member for West Ham, North referred in his Amendment. The gap is widening. No wonder people outside regard the Government's attitude to these matters with a good deal of cynicism.

The hon. Members for Wycombe (Mr. John Hall) and Manchester, Withington said that most of this pension will be taken back by tax. I hope that the tax system treats them no differently from any other citizen. The old-age pensioner would be glad to be treated on the same basis. The old-age pensioner will get a 75p increase in October, with the concession that that sum will be tax-free. However, he would be glad to settle for a £10 a week increase taxed. That is no argument at all.

The Government must justify the reason why these are non-contributory pensions and why there is no service qualification as there is for back bench Members who get a pension according to the amount of service they have put in. That is not the case with the three officers to whom my hon. Friend the Member for West Ham, North has referred. I hope that the Minister will give us adequate replies to these questions.

Mr. Dennis Skinner (Bolsover)

The House of Commons is rather a strange place. All this week and for many weeks before we have been considering and expounding various beliefs on why people should not have certain things and how to combat inflation. The Government are now dealing, or failing to deal, with the railway men. There is the argument about the backdating of their salaries to 1st May, 1972. The CBI joins in. All the political pundits have an answer to the problem of how to combat inflation. We discuss these matters week in, week out, and suddenly, on a Friday, we forget all that has gone before, all the arguments about wage increases and pensions for old people, and become introspective and discuss our own little internal problems.

It seems hypocritical that we are discussing whether to allow the Prime Minister and other office holders an increase of £3,500 in their pensions backdated to 1st April, 1972, when all these other people are accused of holding the country to ransom. I do not want to continue this matter to any great extent, for the good reason that some hon. Members want to deal with a matter which is perhaps more important to them, especially those who have been here a considerable time, who argue that they have a special problem in relation to the Bill, but that is on a contributory basis.

I intervene to say that it seems hypocritical that week in, week out, day in, day out, we condemn the railway men, the miners and the industrial workers, anybody we can hang on to, for asking for wage increases, and so on, and yet on a Friday morning we can come here and say that it is all right for the Prime Minister to get a £3,500 increase in his pension for which he does not have to pay a penny piece.

11.45 a.m.

The Parliamentary Secretary to the Civil Service Department (Mr. Kenneth Baker)

I have some sympathy with the last sentiment by the hon. Member for Bolsover (Mr. Skinner). It is embarrassing for the House to discuss its remuneration and pension arrangements. It has always been embarrassing. That is why the previous Conservative and Socialist Governments moved to the system of appointing review bodies—first Lawrence and then Boyle—to do the work which we would find embarrassing. I shall return to that matter on later Amendments.

The hon. Member for West Ham, North (Mr. Arthur Lewis) correctly concentrated on the three high offices of State. The difference between Ministers' and Members' pensions will arise on a later Amendment, so I will concentrate my reply upon the three high offices of State. What I have to say applies equally to all the Amendments moved by the hon. Gentleman under this group. Their purpose is to remove the special provisions relating to the Prime Minister, the Lord Chancellor and the Speaker.

The hon. Gentleman made it clear on Second Reading that he objected to preferential treatment, whoever got it. That really is the root of the hon. Genleman's argument today and that of the hon. Member for Fife, West (Mr. William Hamilton). With respect to both hon. Gentlemen, that argument does not stand up. Even if we were disposed to order our social and economic affairs to carry their views to their logical conclusion, I do not think that we should start with pension provisions.

That brings me to the main target of the hon. Member for West Ham, North—the three high offices of State. There is a long tradition, hallowed in successive Statutes, that any holder of these offices should receive a substantial pension. The Lord Chancellor's provisions go back to the Act of 1832. It has been the custom since 1832, on the retirement of the Speaker, to pass a special Act giving a pension to the retiring Speaker. Those pensions have been unrelated to service. I will return to that in a moment.

The statutory pension for the Prime Minister is a relative newcomer. That was not introduced until 1937, when it was fixed at £2,000 a year.

I explained on Second Reading why these three jobs seem to the Government, as they evidently seemed to the Boyle Committee, to be unique. I do not propose to detain the Committee by rehearsing those arguments again. Successive Governments have thought it right to give special treatment to these offices. The Boyle Committee clearly endorsed that in Chapter 9. It also suggested that consideration should be given to linking pension of these three high offices to the level of salary that they are receiving, so that if the salary was increased the pension would go up pro rata.

It is true, as the hon. Member for West Ham, North said, that the Prime Minister's salary was recently increased from £14,000 to £20,000 a year, an increase of 43 per cent., and that the salaries of Members were also increased by about 38 per cent. But it would do a great deal to reduce the amount of cynicism outside the House, to which the hon. Member for Fife, West referred about these adjustments if he and his hon. Friends went on to explain that 43 per cent, spread over the years comes to 5.2 per cent, for the Prime Minister and 4.6 per cent, for Members, both of which are well below the increase in the cost of living over the last eight years. It is a great pity that there has been such concentration on figures of 43 per cent, and 38 per cent, when the true figures in relation to railway men, or whoever they may be, are 5.2 per cent, for the Prime Minister and 4.6 per cent, for hon. Members.

Mr. William Hamilton

The hon. Gentleman is being a little unfair. I was referring not to the salaries but exclusively to the pension and the non-contributory basis of it.

Mr. Baker

I shall come to that. I wanted to get straight this matter of the increase.

On the question of the percentage increases for pensions, the hon. Member for West Ham, North said that the Prime Minister had had an 87½ per cent. increase, the Lord Chancellor a 36 per cent, increase and Mr. Speaker a 30 per cent, increase. I congratulate the hon. Gentleman on the accuracy of his figures. Those are the exact increases; but spread over the years from the time when the pensions were last adjusted they come to 9.4 per cent, for the Prime Minister, 4.5 per cent, for the Lord Chancellor and 3.9 per cent, for Mr. Speaker.

Mr. Gerald Kaufman (Manchester, Ardwick)

When the hon. Gentleman gives these percentages, is he giving them by a straight division sum of the number of years divided into the pension, or have his statisticians taken into account, as I believe it is appropriate that they should, the cumulative percentage increase, which would mean that the actual percentage in each case is considerably less?

Mr. Baker

The statisticians based the percentages on the second of those alternatives.

The hon. Member for West Ham, North said that he would like to give the Prime Minister the opportunity of contributing to his pension in the way that other Ministers and Members do and, therefore, possibly earning a higher pension than we give. I shall draw my right hon. Friend's attention to the solicitude which the hon. Gentleman has for his pension arrangements.

I now turn to the non-contributory basis of the pensions. When pensions were first established for these three posts they were established on the basis of being non-contributory, and neither the Lawrence Report nor the Boyle Committee recommended any change. Indeed, it would have been difficult to have done so in the case of Mr. Speaker, because he was granted a pension only after he ceased having any salary and, therefore, he could not contribute towards it during his time as Speaker. Both Boyle and Lawrence looked into this and agreed that the pensions should remain on a non-contributory basis.

I now come to the question of a day's service. It is true that these pensions would be paid to these three office holders for one day's service—I dare say for one minute's service—and I cannot help reflecting that it might be of benefit to us all if we were all allowed to have one day at the job on a rotating basis. I hesitate to think how difficult it would be to get the person to resign at the end of 24 hours. But the pension is payable to somebody on that basis.

However, when one looks at the history of the matter one sees that that has never happened. I cannot, of course, predict the future. It is possible that any of these three office holders may die on the day on which he is appointed, but it has never happened so far. The shortest time for which anyone has been Prime Minister this century is seven months, and that was Bonar Law. There was a shorter one in the 18th century, the successor to Walpole—Wilmington, who went mad after five months and had to resign. But in this century the shortest tenure of office was by Bonar Law, for seven months.

Mr. Douglas Houghton (Sowerby)

And then he died, and presumably never drew any pension?

Mr. Baker

That is true. Bonar Law would not have drawn a pension because there was not a pension for the Prime Minister in 1923 when he resigned. But he died shortly after that of cancer of the throat.

Mr. Charles Pannell (Leeds, West)

It has not so far been mentioned, and I am sure that it will not be unless I raise it, that the Prime Minister's pension of 1937 arose from the fact that it was considered to be a scandal that in his declining years one of the greatest Prime Ministers of all time, Lloyd George, lived largely on an annuity provided by Andrew Carnegie. That was not thought proper for the holder of such an office, and that was the precursor to the introduction of the pension in 1937.

Mr. Baker

I am grateful to the right hon. Gentleman for that.

The argument that an office holder can get a pension for a day's service is unrealistic. The average tenure of premiership this century, from Arthur Balfour down to the right hon. Member for Huyton (Mr. Harold Wilson)—one has to stop the statistical percentages there—is 4 years and 10 months. Sir Winston Churchill was the longest holder of office, with 8 years and 8 months, and Asquith was next, with 8 years 7 months.

When one looks at the other offices of State, one finds that no Speaker has served for just a day. The average tenure of the Speaker ship is much longer than the average tenure of the Prime Minister ship. In this century the average time that the Speaker has held office is 9 years 5 months. When one comes to the Lord Chancellor ship, one finds that no Lord Chancellor has served for only a day. In this century the average service of Lord Chancellors is four years. Lord Kilmuir served for 7 years 9 months, and Lord Caldecote, at the beginning of the war, served for 8 months. It is, therefore, unrealistic to say that a pension can be earned for just one day's service.

I think it was the hon. Member for West Ham, North who said that it would be possible to draw two pensions, one as an ex-Speaker, and one as an ex-Prime Minister.

Mr. Arthur Lewis

I did not say that.

Mr. Baker

But that could happen. Someone could draw a pension as an ex-Speaker, and also get a pension as an ex-Prime Minister. In addition he could draw a pension as an ex-Lord Chancellor if he also happened to have occupied that post, though that would be a rather unusual career pattern. The nearest that anyone has got to that in our history is Addington, who succeeded William Pitt in 1801. He was an undistinguished Speaker, and an even more undistinguished Prime Minister for two years. If these arrangements had been operating then, he would have been able to draw two pensions.

Mr. Lewis

I did not raise this matter, but I appreciate the Minister's having mentioned it. Could the situation arise that a Prime Minister retires—or, as I should prefer it, is defeated at a General Election—and receives a pension, then becomes Leader of the Opposition and pays a contributory basis and in due course receive that pension, and then becomes Mr. Speaker, and on retirement gets that pension too?

Mr. Baker

It opens up most interesting career possibilities, but I have to inform the hon. Gentleman that that would not happen under the pension arrangements, because when a Member of the House becomes Prime Minister and qualifies for the Prime Ministerial pension he cannot go back into the Members Pension Fund. That is one of the exclusions in the Bill. When he becomes Prime Minister, he ceases to be a member of the Members' Pension Fund; his contributions are frozen and they are repaid to him when he ceases to hold the office of Prime Minister. When he ceases to hold that office, if he remains a Member, as the right hon. Member for Huyton has, he does not go back into the Members' Pension Fund; he therefore gets a pension as a former Leader of the Opposition, or as a former Member. I hope that I have now dealt with that.

Mr. Lewis

I was not referring to the fact that the individual still had a job. I was assuming that he had retired. As I understand the Clause, an ex-Prime Minister would been titled to his pension under the old scheme, and will now be entitled to contribute on the basis of his £9,500 a year for the supplementary pension.

12 noon.

Mr. Baker

The hon. Gentleman did not quite follow me. The pension rights position of these three high offices is unique. When a Member of this House becomes Prime Minister or Speaker—or a Member of the House of Lords becomes Lord Chancellor—he ceases from that moment to be a Member of the Members' Pension Fund and of the Ministerial supplemental scheme. When he ceases to be Prime Minister or Speaker he does not go back into the scheme.

I have been asked why these three high offices should have special treatment. As I said on Second Reading, they are unique Offices of State. The Speaker represents this House in our corporate entity, the Prime Minister represents our country, irrespective of his party, and the Lord Chancellor is the head of the judiciary. There has been a long tradition that we should make special provision for these high offices.

The first, of course, was made for William Pitt, when in 1806, on his death, a Resolution was moved in the House to pay his debts of £40,000. Over the years this has been an area of sensitivity, and in this century it has not been unknown for former Prime Ministers to be in difficulty in their retirement. Balfour, although he started life as a rich man, had become relatively hard up towards the end of his days. Perhaps the most eloquent example is Asquith, who, after many long years of great service to our country, found himself, in 1925–26, in financial difficulties. Some of his friends and, indeed, some of his opponents got together a fund to pay him a pension for the last few years of his life.

I cannot believe that this is how we should treat people who have held these high offices. There has always been a special recognition here, and this is what the Bill extends. It tries to correct the relationship between the value of the three pensions which have got a little distorted—the Lord Chancellor being the head of the field, as it were, by his judicial connections.

I must therefore ask the House to resist the Amendments. They are very much against the spirit of both Lawrence and Boyle, for the reasons that I have explained.

Amendment negatived.

Question proposed, That Clause 2 stand part of the Bill.

Mr. Arthur Lewis

I believe that the Minister may be wrong on a point that I raised with him earlier. An ex-Prime Minister has an automatic pension right which is now £7,500. When he ceases to be Prime Minister, one may assume that he might become Leader of the Opposition, in which case he would be classified under subsection (2)(b). Paragraphs (a) and (c) are specific, but paragraph (b) only refers us to part of Schedule 2 of the main Act, which lists the Leader of the Opposition at £9,500 a year, the Chief Opposition Whip at £7,500, the Assistant Opposition Whips at £4,000, the Opposition Leader in the House of Lords at £3,500 and the Chief Opposition Whip there at £2,500.

Under Clause 2 they will be able to make voluntary contributions on the higher pensions which Ministers and ex-Ministers, if so classified, will be able to get. So the poor old ordinary Member of Parliament will be rightly limited to his salary while these other hon. Gentlemen will be able to get a pension based upon those incomes.

Taking it a step further, a Leader of the Opposition who had been Prime Minister would automatically have his Prime Minister's pension of £7,500, non-contributory, but, if he wished, he could contribute from the time that he was Leader of the Opposition on the basis of his £9,500 salary. If he contributed enough, his pension could be more than the £7,500, and I presume that he would then be able to select which one of the two pensions he would like to draw.

Mr. Kenneth Baker

The hon. Member is perceptive in looking at Clause 2(2) and perhaps drawing that conclusion, but he must also look at Clause 3(3) and Clause 4(4), which specifically say that a Member of this House who has been and has ceased to be Prime Minister, if he remains a Member of the House, cannot go back into the Member's Pension Fund or, if he becomes another Minister, into the Ministers' scheme. He ceases to have that right. The rights that he had built up as a member of the Members' Pension Fund before coming Prime Minister are terminated on his appointment to that office, contributions are frozen and they are repaid when he ceases to be Prime Minister, That is the position under the Bill.

Mr. James Wellbeloved (Erith and Crayford)

The Minister's case is absolutely right in respect of these three great Offices of State. We would want them properly protected in future by adequate pensions. But, having listened to my hon. Friends, I believe that there is an unanswerable case for writing in at some future time a length-of-service requirement and a contributory responsibility. Is it the Government's intention to ask the Review Body when it meets again—I believe it is now required to do so every four years—specifically to pay attention to those two points—length of service and contribution for the pensions—and make recommendations to the House on the next occasion if it thinks fit?

Mr. Baker

I am sure that the Review Body will take careful note of this debate when it next examines the question of Members' salaries and pensions. I want to refer to the matter in speaking to a later Amendment rather than in this discussion on the Question "That the Clause stand part of the Bill".

Sir R. Cary

It is not possible under any part of our structure to draw a State pension and a State salary at the same time. The Leader of the Opposition must have one or the other.

Mr. Baker

I confirm that that is not possible, as I understand the position. There is a later Amendment which deals with this matter rather more specifically.

Question put and agreed to.

Clause 2 ordered to stand part of the Bill.

Clauses 3–5 ordered to stand part of the Bill.

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