HC Deb 04 March 1982 vol 19 cc461-6 7.33 pm
The Under-Secretary of State for Energy (Mr. John Moore)

I beg to move That the draft Mineworkers' Pension Scheme (Limit on Contributions) Order 1982, which was laid before this House on 11th February, be approved.

Perhaps, Mr. Deputy Speaker, we could discuss also the draft Redundant Mineworkers and Concessionary Coal (Payments Schemes) (Amendment) Order 1982.

Mr. Deputy Speaker (Mr. Bryant Godman Irvine)

If that is for the convenience of the House, so be it.

Mr. Moore

The first draft order is similar to orders which the House has considered at about this time each year since 1977. Section 2 of the National Coal Board (Finance) Act 1976 empowered the Governmènt to make contributions of up to £18 million per year for 20 years for the purpose of reducing the deficiency in the mineworkers' pension fund attributable to those persons who had left the industry before 6 April 1975. The rapid contraction of the industry during the 1960s meant that by then such persons outnumbered the active contributors to the fund, and it was not considered right to ask the industry itself, or the active contributors, to carry this burden of the past.

The 1976 Act also allowed the level of contributions to be raised by statutory instrument to take account of the increases in deficiency occasioned by increases in the pensions paid to the pre-April 1975 pensioners. As I have said, this has been done every year since 1977, so that currently the permitted level of contribution stands at £49.28 million per year. Last September, the basic mineworker's pension was raised in accord with the retail price index, from £8.92 to £9.93 per week. We are advised by the Government Actuary that the consequent increase in the deficiency could be met through an annual payment of £5 million for the remaining 14 years of the support arrangement. Therefore, we have laid before the House the draft of an order which raises the permitted level of contributions to £54.28 million.

The 1976 Act requires the Secretary of State to lay with the draft order a statement explaining the considerations that have led him to conclude that the order should be made. The statement sets out in detail the points that I have touched upon. It also points out that the extent of support that the Government are giving to the board's operations generally does not give any scope for contending that the board could meet the additional cost of £5 million during either this financial year or next. For later years, the position can be kept under review. The order empowers the payment of £54.28 million per year up to 1994–95, but follows the wording of the original 1976 Act in not compelling the Government to pay all or any of this sum.

I turn to the second draft order. On Second Reading of the Coal Industry Bill, and again during the discussions in Committee, I recalled the substantial improvements in benefits under the redundant mineworkers' payments scheme that were introduced through the amendment order that the House considered on 18 March 1981. The present amendment order introduces no such radical measures; it simply tidies up a number of features of the scheme and updates the level of benefits.

Each year there is introduced a new table of basic benefit under the redundant mineworkers' payments scheme, payable now for up to five years in addition to unemployment benefit or its equivalent. The table applies to persons made redundant during the subsequent year. The level of basic benefit is adjusted to preserve the overall level of benefit at about two-thirds of previous earnings, taking account of increases in unemployment benefit, which are payable in addition, and of certain other factors. In addition, the new tables introduced in the past have often increased the maximum level of earnings reckonable in the assessment of benefit. This year is no exception. The increase is from £130 to £140 per week.

As an example of how the table works, a married man made redundant on or after 6 April with pre-redundancy earnings of £140 per week will receive £55.14 per week scheme benefit, plus £36.40 unemployment benefit in his first year of redundancy—a total of £91.54 per week, which is approximately two-thirds of £140. In subsequent years, of course, his scheme benefit will be increased in accord with the cost of living, and unemployment benefit equivalent will also be paid at the current rate.

There are a few other minor upratings and amendments. In particular, the position of the few people who have reentered coal industry employment following an earlier redundancy and payment of weekly benefit is clarified. If such a person is made redundant for the second time on or after 6 April, his payments of benefit will resume and will now continue at the approximately two-thirds rate for a total of five years, irrespective of whether his earlier redundancy was before of after 11 March 1981, provided that his period of re-employment lasted at least a year. In addition, he will be able to elect whether to regard his first or second redundancy as that which determines his benefit for all purposes. This is a complex amendment. It affects very few people, but makes their position fairer.

In the light of all those points, I seek the agreement of the House to both orders.

7.38 pm
Mr. Alex Eadie (Midlothian)

I do not wish to detain the House unduly, but I have some comments to make. As the Under-Secretary of State said, the proposed measures are an improvement on the existing situation. The Secretary of State's statement and the draft instrument explain why the 1982 order contains an increase from £49.28 million to £54.28 million. As the hon. Gentleman said, that is an increase of £5 million.

I do not wish to rehearse the reasons, because they are set out in order and the statement. In the explanatory note, which is not part of the order, four changes have been set out. I think that the Minister is aware—as some of my hon. Friends are—that discussions take place between the unions and the Department of Energy. The unions advanced what seemed to them to be improvements in the RMPS. In their representations, they put forward a number of suggested changes, which I shall list as it is important to put them on the record.

First, they said that during the first year of benefit single men or married men with working wives were at a disadvantage as their benefit would be calculated on the assumption that they were in receipt of unemployment benefit allowance for an adult dependant.

Secondly, the unions suggested that, by virtue of the requirement to register as unemployed, members who were invited to visit their families or who took a holiday would be unable to qualify for RMPS benefit during the weeks in question.

Thirdly, the unions said that the requirement to register as unemployed had been a bone of contention with their beneficiaries for many years and asked the Government to adopt a more flexible approach.

Fourthly, they said that a member made redundant under the RMPS could qualify for the concessionary coal allowance under the industry agreement that he would have received had he retired at 65, but that if he took up any employment following redundancy he would lose his concessionary coal entitlement—for life, in the majority of cases. Many of my hon. Friends deal with such cases. Sometimes we cannot for the life of us understand why that should happen.

The unions' fifth point was that the RMPS was conditional on the employee becoming redundant, mainly as a result of a colliery closure or a reduction in the services there. The unions drew the attention of the Department of Energy to a number of employment conditions within the mining industry that were not as yet covered by the scheme. The Minister and his officials must be aware that we are here discussing other ancillary undertakings in the mining industry.

The unions also asked the Minister for a more realistic earnings ceiling in the light of the earnings pattern in the mining industry. He made passing reference to that. As I understand it, the main provision is an increase from £130 to £140 per week in the limit on earnings reckonable for weekly benefits for persons made redundant on or after 6 April 1982. The Minister touched on that also. The new limit represents a larger advance than recently provided with respect to payments under the Employment Protection (Consolidation) Act 1978. That is why I said that the proposals that the Minister has announced represent an advance. The Opposition recognise that.

The second main effect of the orders is to tidy up some provisions relating to persons who have re-entered the industry and again become redundant, if they are made redundant for the second time on or after 6 April 1982. Those persons will be entitled to five years basic benefit, whenever the first redundancy occurred. It is made clear that the level of benefit may be based on earnings before the second redundancy.

My third observation is that the usual raising of the normal minimum level of basic benefit for all beneficiaries is in line with mine workers' basic pension. The Minister will be aware that there was a seminar organised to discuss the RMPS last year—I must also put this on record—at which some representatives of the union were present—"officials" in the sense of what one might call the civil servants of the union. A representative of the Department of Energy was also present.

I believe that some responses were put forward in relation to the rules of the scheme regarding unemployment benefit. The Minister may wish to comment on this. I understand that the subject of registration for unemployment and payment of benefit is being considered by the DHSS/Department of Employment working party, but I am not sure whether discussions are still going on or whether conclusions have now been reached. Can the Minister give any information on that? I am also told that the NUM is discussing with the board the concessionary coal provision for persons re-entering employment and that the Department of Energy has said that in the arrangements for eligibility to quality for RMPS the present criteria are…fundamental to the basis of establishing RMPS, as a special Government scheme in recognition of the particular circumstances of the coal industry. I stress once again that real progress has been made with the Minister's announcement about the orders. The orders achieve an improvement and we shall certainly support them. Nevertheless, to some extent, they are born out of contraction and redundancy in the industry. I put on record once again the figures that I gave when my hon. Friend the Member for Bolsover (Mr. Skinner) spoke about this. Since last March, 13,000 men have left the industry, of whom some 8,000 were made redundant. The Minister may wish to confirm those figures, as I know that his resources for checking figures are greater than mine, although I think that my figures are correct. The Opposition certainly approve the orders, but it is sad to note that, from March to March, 1981–82 has seen the highest rate of pit closures since 1971. Therefore, although we appreciate the progress being made and are grateful for the way in which the Minister has introduced the orders, there is nevertheless an element of sadness because contraction of employment in the industry is involved.

7.48 pm
Mr. Jack Dormand (Easington)

I shall be brief. I wish to raise a matter relating to concessionary coal. For some years this matter has caused concern in my constituency—and, I suspect, in other parts of the country—and I regret that the Minister made no reference to it.

Miners' widows aged over 60 do not qualify for concessionary coal. I say immediately that I do not think it is a problem of easy solution. Nevertheless, some injustice is being caused. There are anomalies and inconsistencies in the present arrangements.

In my area, and perhaps in other coalfields, it is possible for a man to work for 46 years in the mines and, if he dies before he becomes entitled to the concession, for his widow to be refused it. That seems a manifest injustice. Again, if a man retired early through ill health and was not in receipt of concessionary coal, his widow will not receive it.

There is a rule banning the receipt of concessionary coal by any widow who works for more than 16 hours in one week. That is particularly harsh. Many women find it difficult to manage on the pension they receive. Therefore, they are forced to work and so forfeit the coal allowance.

It is galling and frustrating for widows who are affected in these various ways to know that women in other parts of the country are not so affected. There is a crying need for a national agreement on this matter. I find it difficult to understand why it is taking so long to have it established. The Durham miners, with whom I am proud to be associated, have pledged their support for it. I am sure that miners everywhere will share their view.

The question of cost will, of course, be raised, but there can be little doubt that it will be very small. In the debate on the Coal Industry Bill, many millions of pounds were authorised. A scheme such as I am proposing would cost considerably less than £1 million. I hasten to add that I have not seen any costing of the scheme, nor have I attempted to make one.

No section of the community has made a more effective contribution to society than the miners, but they would be the first to say that that contribution could not have been made without the dedication of their wives. Miners' wives have to endure all the worries of this unique industry. The time has now come to rectify the shortcomings and anomalies in the present arrangements. The undertaking must be carried out, with full consultation with the National Union of Mineworkers which, I am sure, will give every possible help.

The need is urgent. I ask the Government to take the initiative now to bring about a more just settlement of this unhappy situation.

7.53 pm
Mr. John Moore

With leave of the House I shall touch briefly on the points that have been made, because I imagine that hon. Members will want me to come back to them in greater detail in correspondence.

The hon. Member for Easington (Mr. Dormand) raised a point to which I said I would return in detail. The details of the agreement on the provision of concessionary coal are arranged between the board and the union. The hon. Gentleman asked about the Government's contribution to the costs, but I have already made a commitment to pursue that point.

The hon. Member for Midlothian (Mr. Eadie) asked questions, of which I am aware because they are raised through the normal negotiating machinery, concerning payments of married rates, holidays, the requirement to register, concessionary coal and the conditional relationship to RMPS payments relating to closures in the industry. He also commented on the need for a more realistic earnings ceiling. I shall come back to him on that, but he will be aware that the union and the board are discussing these particular points with the Government.

The hon. Gentleman had the figures relating to the redundancies for the year generally right, but I think it would be wiser to have the figures officially on the record. I shall try to do that through a letter or by a specific parliamentary answer to him.

It might be useful to put on record the part of the review to which the hon. Gentleman referred and on which he asked to be updated regarding the problem of registration relative to RMPS benefits. The conditions have not changed—they have been the same since 1968—and the problems associated with them have not changed. This is a long-standing issue which is wider than the RMPS. It affects everyone receiving unemployment benefit. It was considered by a joint study group of officials from the DHSS and the Department of Employment. The officials who looked at the whole system of benefit payments in consultation with Sir Derek Rayner last year, recommended that people should be able to miss one fortnightly signing in a year. The timing and introduction of changes in procedures based on this recommendation are still being considered by my right hon. Friends the Secretaries of State for Social Services and Employment. Obviously, I shall draw their attention to the points that have been raised in the debate. My Department has a particular interest because of its relationship to the RMPS in this particular area.

I appreciate the welcome that has been given to the orders. They represent a tidying up and a modest improvement. I have taken note of the points that have been made and I will try to come back to hon. Members on them. I hope that the House will allow the orders to go forward.

Question put and agreed to.


That the draft Mineworkers' Pension Scheme (Limit on Contributions) Order 1982, which was laid before this House on 11th February, be approved.


That the draft Redundant Mineworkers and Concessionary Coal (Payments Schemes) (Amendment) Order 1982, which was laid before this House on 11th February, be approved.—[Mr. John Moore.]