§ 27. Mr. Peter Morrisonasked the Minister for the Civil Service how many letters he has received on the subject of inflation-proofed pensions for the Civil Service.
§ Mr. Charles R. MorrisDuring the last 12 months my Department has received some 150 letters on the subject of pensions inflation-proofed under or by analogy with the Pensions (Increase) Act 1971. Not all the letters specify which of the many categories of public service pensions so covered the writer has in mind.
§ Mr. MorrisonHow does the Minister reconcile the fact that the pensions of those civil servants who have already retired will be greater than the pensions of those about to retire because they have had their pay held down under the Government's pay policy?
§ Mr. MorrisThe hon. Gentleman has referred to a major difficulty. My Department is currently giving attention to that difficulty.
§ Mr. Arthur LewisWill my hon. Friend look at my letter to him in which I pointed out that the man who is alleged to have invented or to have brought in the wage freeze, Lord Armstrong, retired a year before he should have done, postponed drawing his pension for 12 months, and then took on the chairmanship of a bank at £25,000 a year, having declared himself to be in favour of a wage freeze? Will my hon. Friend see that that is done for all the people of this country?
§ Mr. MorrisI have read every letter that has been written to me since I took on my present responsibilities. I assure my hon. Friend that the individual to whom he referred has been treated no differently from other civil servants in the same position.
28. Mr. Tim Rent onasked the Minister for the Civil Service whether he is satisfied that sufficient independent advice regarding the cost of inflation-proofing pensions is available to the Pay Research Unit.
§ Mr. Charles R. MorrisThe task of the Civil Service Pay Research Unit is to identify comparable jobs outside the Civil Service and to provide the facts about the rates of pay and other conditions of service—including pensions—attaching to these jobs. The rates of pay thus provided are subsequently adjusted for differences in pension contributions and benefits in the way described in my reply to the hon. Member on 1st December last. The Pay Research Unit does not therefore need advice on the cost of inflation-proofing a pension for its work.
Mr. RentonIs the Minister satisfied that the difference of 1.75 per cent. currently deducted from civil servants' pay is adequate to reflect the differences between the Civil Service pensions scheme and outside pension schemes? As few outside pension schemes are inflation proofed beyond 5 per cent. a year and the cost of covering inflation at the 10 per cent. rate as opposed to 5 per cent. may be estimated as requiring an additional contribution equal to 12 per cent. of salary, would it not be sensible for the PRU to take more independent advice so that it will be seen to be impartial?
§ Mr. MorrisI refer the hon. Gentleman to my answer to him on 8th 890 December 1975, which I think explained the point he has made about the 1.75 per cent.