RETIRED OFFICERS' PENSIONS

HL Deb 20 January 1953 vol 179 cc1091-100

3.8 p.m.

LORD JEFFREYS rose to call attention to the grievance of officers who retired under the provisions of the Royal Warrant and corresponding instruments of 1919, and whose retired pay, after being reduced on account of the fall in the cost of living between 1924 and 1933, has not been correspondingly increased on account of the subsequent great rise in the cost of living; also to call attention to the inadequacy of the rates of pension of the older classes of retired officers of the Armed Forces; and to move for Papers. The noble Lord said: My Lords, I rise to move the Motion standing in my name concerning the retired pay of officers of the Navy, the Army and the Air Force, and particularly to consider the sense of grievance which is felt by those officers who retired under the provisions of the Royal Warrant and corresponding instruments of 1919. When I refer to-day to the Royal Warrant I hope that I may, for brevity, be allowed to mean also those other instruments which correspond—Admiralty Fleet Orders, Air Ministry Orders, Army Orders, and so forth.

As is customary in another place, I would first disclaim any personal interest in this matter. My own retired pay was granted under a special Warrant applicable only to certain officers; and I am not affected in any way whatsoever by the Royal Warrant of 1919. In the Motion as it was originally put down was a reference to the inadequacy of the pensions of officers' widows, but I withdrew that part of my Motion. The new and improved rates of pension for such widows recently announced show that something has been done for these widows, and even if those rates do not err on the side of generosity, I am encouraged to hope that the Government will do something to rectify the longstanding grievance of those officers who retired under the Warrant and Orders of 1919.

Paragraph 1 of the Royal Warrant of that year read as follows: The rate will be subject after five years to revision, either upwards or downwards"— I ask your Lordships to note those two words— to an extent not exceeding 20 per cent. according as the cost of living rises or falls. After the 1st July, 1924, a further revision may take place every three years. Those terms were the same for all three Services, though the wording was slightly different. I shall refer to that matter a little later on. In the case of the Army, the Warrant bore the signature of the then Secretary of State for War. It was a signature which was then, as it is now, a guarantee of good faith and in which there was the utmost confidence: it was "Winston S. Churchill". Can there be any doubt in any reasonable person's mind as to the intentions of that Warrant? The words of the Warrant were certainly taken as a promise by the officers concerned. I am, of course, aware that the Treasury claim that the word "may" in "may take place every three years" gives them an option to disregard the quite definite statement, "The rates will be subject … to revision," which comes earlier. I myself have been accused in another place by a Government spokesman of not knowing the difference between the words "may" and "shall." I wonder whether it is only the "gentleman in Whitehall" who can understand plain English. I suggest that this quibble is quite unworthy of a Government Department.

Moreover, whilst the terms of the Royal Warrant do include the word "may" in "may take place," Admiralty Fleet Order No. 2483 of 1919 is somewhat differently worded. It is as follows: It has been decided that 20 per cent. of the new rates of retired pay for officers shall be considered as due to the high cost of living, and shall be subject after five years to change either upwards or downwards"— and I ask your Lordships to note that those words are the same— according as the cost of living rises or falls. The revision thereafter to take place every three years up or down on the basis of the Board of Trade prices. There is no word "may" in that Order, nor does the word "may" appear in the corresponding Air Ministry Order No. 1003 of September 15, 1919. Again I say, can there be any doubt whatever as to the intentions of that Warrant and those Orders?

Now let us see what actually happened. From 1919 to 1922 the cost of living rose but, as the period was less than five years, the rise was not taken into account. That was in accordance with the Warrant. Thereafter, the cost of living fell steadily, and from 1924 onwards retired pay was reduced accordingly, until in 1933 it had been reduced to 11 per cent. below the basic rates of 1919. There is no question, I would say, of any doubt or any option as to the action of the Government. So long as the cost of living was falling, for so long the word "may" was interpreted as "shall," and the words "will be subject to revision" were taken quite literally and were acted upon. But in 1934 there was a slight rise in the cost of living figure and further rises appeared probable. Then it was that doubts began to afflict Treasury minds, doubts as to the meaning of the word "may" and the word "will," and it was decided that no risks must be taken of having to raise retired pay as a result of the rise in the cost of living. Accordingly, it was decided to consolidate and stabilise—those were the words officially used—the rates of retired pay; and in 1935 retired pay was stabilised at 9½ per cent. below the basic rates of 1919. This, I would say, was a one-sided and, I venture to add, far from creditable arrangement to which the agreement of those affected was neither asked nor given. It was, in fact, the fine old game as played by the Treasury of "Heads I win, tails you lose."

There is one more point I should like to make. Whenever there is any question of a possible increase of pensions, it is argued on behalf of the Treasury that no new pension code can be or should be retrospective. But the stabilisation of 1935 was in fact the introduction of a new code, and since it applied to all officers who had retired under the code of 1919, it was in fact retrospective, and retrospective for some sixteen years. In another place a former Chancellor of the Exchequer, in answering me, said that he was opposed to exceptional treatment of ex-officers of the Forces. We do not ask for exceptional treatment; we ask for bare justice for these retired officers. But we also claim for them, as a right, the full benefits laid down in the Royal Warrant and other Orders of 1919 under the terms of which they retired.

I would say a word as to the Pensions (Increase) Acts of 1944, 1947 and 1952. By the Act of 1944, an increase of 10 per cent. was granted on pensions not exceeding £400 a year—that is the lowest range of pensions: that is to say, these officers get back the whole reduction, plus one-half of 1 per cent. On pensions between £400 and £600 an increase of 7½ per cent. was granted. By the Act of 1947, on pensions between £600 and £750 there was an increase of 5 per cent., leaving these short by 4½ per cent. of the basic rates of 1919. All higher pensions received no increase whatever. In the Act of 1952, the only increases are based on what is called "hardship," and are given to those on the lowest rates of pension. For instance, if a pensioner is single and over sixty, and his pension is £425 per annum or under, he gets an increase of £20 per annum. If he is married and over sixty, and his pension is £550 per annum or under, he gets an increase of the munificent sum of £26 per annum—½6 more that if he was single.

What then is the general position? The cost of living is far above that of 1919, when the cost of living figure was 115. In 1947, it had reached 203, when the new system of computation started. Under that new system, which took into consideration other factors, the cost of living in 1952 had risen 32 per cent. as compared with 1948; that is to say, in 1948 it was 211.5 and in 1952 it was 235.5. Incidentally, the value of money to-day is enormously below that of 1919. Prices are very much above those of 1919. Consequently, salaries, wages, the pay of the Services, post-1945 pensions—I may almost venture to add the salaries of Members of Parliament—have risen very appreciably indeed. Yet only the lowest rates of Service pensions come up to even the 1919 rates. The increases given were only up to the level of the 1919 rates: these men get no increase on account of the increased cost of living. And in the higher pensions, not only is there no increase but there is an actual reduction as compared with 1919—and these are the men who served longest and bore the heaviest responsibility. I wonder how many, if any, wage and salary earners—or, if it comes to that, pensioners—are paid lower than the 1919 rates, as are these old officers? I very much doubt whether anybody except these old officers is paid even lower than the rate of 1919.

It may be asked what would be the cost of granting to those entitled to it retired pay on the scale laid down in the Royal Warrant of 1919—that is to say, 20 per cent. above the basic rates of 1919. I do not know what the exact cost of doing this would be, but I have heard mentioned a figure of between £350,000 and £400,000 per annum. If that figure is correct, it is not a very large sum to spend on doing bare justice, and fulfilling an obligation to these faithful servants of their country. In these days, when in all directions millions of pounds are spent like water, I suggest that that is not a very large sum to spend on doing justice. Let it not be forgotten that, whatever view the Treasury may take as to their liability to make payments, they do not omit to collect every sixpence due in taxes, so that pensions of £700 £1,000, £1,200 or whatever they may nominally be, are, after deduction of tax, worth very much smaller amounts.

Another argument which the Treasury may use against granting any increase in the retired pay may be to say, "If we do justice to Service pensioners, or indeed if we give them an increase of any kind, claims may be made by others—for instance, civil servants." I agree that some such claims may be made. Nevertheless, I submit that the strongest claims are those of officers who have served all over the world, who have faced dangers, who have endured hardships, who often have never known a settled home or good opportunities of educating their children without long separation from them, whose conditions have been less safe, less settled and less comfortable than those in the Civil Service, or indeed of any civilian, and who, on account of the necessity for physical fitness, if not for other reasons, are frequently retired at an earlier age than civil servants; and, lastly, who have been given a definite promise of certain terms, which promise has never been fulfilled.

I would add a word as to the officers who retired before 1919—that is to say, the older class of retired officers referred to in my Motion. They have had no undertaking given them such as was given to those who retired under the Royal Warrant of 1919, but their pensions are much smaller. They were granted when the pound was worth a pound—a golden sovereign. They are equally affected by the high cost of living and by the fall in the value of money. They are far from young, so if any increase is given to them the liability will not be one of long standing. There are not many of them, and some small concession as regards their retired pay would be a welcome and a generous gesture on the part of the Government. As an example, may I quote the case of a lieutenant-colonel, or one of equivalent rank in the other Services, of, say, the year 1914, and retired at £420 per annum? Again, I would stress that that is 420 golden sovereigns. Perhaps that is why, under the Act of 1952 which I have quoted, a pensioner, if he is single and over sixty and whose pension is £425 per annum or under can get an increase of twenty depreciated pounds.

My Lords, it is possible that some of my noble friends may wish to extend this debate very much further and to discuss the general question of pensions. I do not propose to do so. I am confining myself to pleading the case of the two classes mentioned in my Motion—namely, those who retired under the Royal Warrant of 1919 and who have, in my submission, a right to benefit by its terms, and the older pre-1919 officers for whose case I would beg favourable consideration. I am glad that my noble and gallant and very distinguished friend the Minister of Defence is to reply for the Government. I hope that his reply may be favourable, but in any case I am certain that on this as on all other occasions he is not unsympathetic to the interests of his old brother officers. I beg to move for Papers.

3.27 p.m.

LORD OGMORE

My Lords, I am sure all your Lordships wish to join me in congratulating the noble Lord, Lord Jeffreys, on moving this Motion in your Lordships' House. For many years in another place he tried to persuade successive Governments to take action on this matter, and I feel that, to some extent, at all events, the work that he did there has enabled or persuaded the Government to make some concession to widows and to their dependants, even though on the main question he has not had the success that we all hope he will have today. I am here to support him in the excellent speech he made. I do not propose to make a long speech because the noble Lord has covered all the ground that could be covered. I speak to your Lordships to-day merely to dot the "i's" and cross the "t's." Before going into the main subject I should like to congratulate the Government on having made the provision that they have made for widows and for their dependants, and on having extended for the first time the class of widow. This is a very considerable step forward. I do not want to look a gift horse in the mouth, and what I am trying to do to-day is to encourage the Government to go forward with their good work, not to criticise what they have already done. I feel quite certain that, in the good work that they have done, the noble and gallant Earl the Minister of Defence and the Secretary of State for Air have pulled their full weight, in the interests of the Government, in persuading their colleagues to make the new arrangements that have been made. I personally should like to thank the Minister of Defence for the work that he has done in this way.

Because originally this Motion set down by Lord Jeffreys covered the question of widows (although he has now excluded them, for the reasons that he has given) I feel that I ought just to refer to the White Paper which has been issued only to-day and which is available in the Printed Paper Office at the moment. There seems to be some distinction made between widows of various types. In paragraphs 4 and 5 of the White Paper there is a distinction between long-service other ranks, as well as officers and Warrant Officers, Class I, who have given full-time service since August 31, 1950,and officers and Warrant Officers, Class 1, whose service terminated on or before August 31, 1950. A distinction is there made which was not made in the statement given by the Secretary of State for Air on December 16 As I have only just got the White Paper—it has been available for only a few hours in the Paper Office—I have not yet had time to ascertain exactly what this distinction implies. Perhaps the noble and gallant Earl will be able to tell us when he comes to reply on behalf of the Government. I would say, however, that, apart from the merits or otherwise of the distinction, I think it is unfortunate to bring in yet another anomaly on this subject of pensions.

Since I have had the pleasure of being concerned with the noble Lord, Lord Saltoun, and others in this matter, we have found that the whole subject bristles with anomalies. Indeed, it seems to he very much a question of engaging in a "lucky dip" to see what you are going to get out of it. Apparently it depends entirely on when an officer entered a Service what pension he or his widow or his dependants get. Surely that is ridiculous. The service of an officer is equally valuable at any time. You have an Army, and au officer is engaged as an officer in that Army, whether he serves in one particular twenty-five years' period or another. Which twenty-five years' period he serves in should have no bearing whatever or the matter of pension. It is an absolutely illogical state of affairs that the pension which an ex-officer or his widow or his dependants get should depend on whether his service was between one particular period of years or another. To bring in yet another anomaly, as is now apparently being done—and it appears to be a retrospective anomaly at that—seems to be adding fuel to the fire.

Three aspects strike me in connection with this particular question. The first, as the noble Lord, Lord Jeffreys has explained, is that pension rates in 1919 were based on the cost of living. When the cost of living went up, the pension was supposed to go up also. On the occasions when the cost of living went down—and in my experience such occasions have been very rare—the pension would go down, and so on. Now it so happened that the cost of living did go down—at least, according to the computations of the Board of Trade—in or about the year 1933. And down, with great celerity, went the pensions of the retired officers, the widows and the rest. From then on, the cost of living began to rise. But pensions did not rise. In fact, in 1935, as I understand, pensions were fixed at a level 9½ per cent. below that of 1919.

The second aspect of this matter which strikes me is this. Officers who retired after September 1, 1950, receive more than those who retired before. On what basis of logic, or common sense, can this be justified? Does an officer who retired on August 31, 1950, eat less than one who retired on September 1, 1950? Does he wear fewer clothes? Does his fuel cost him less? Does his housing cost him less? If he has to educate children, are the school fees less for the officer who retired on August 31, 1950, than for the officer who retired on September 1, 1950? Surely the Treasury, if they are going to make distinctions, should not make absurd distinctions of this kind. Personally, I do not think it is a good thing to make distinctions in pensions. There may well be distinctions by reason of rank, of course, but there certainly ought not to be distinctions relating to the time when the service was given, because, as I have pointed out, all service is equally valuable so far as the country is concerned. At all events, it is not within the scope or the competence of the officer to make a decision affecting this matter. So, as I have said, this distinction seems even more absurd and illogical than most.

The third aspect which strikes me in regard to this question is that we have two types of service in this country—and I am using the term in its highest sense. The first is the Naval, Military or Air Service, and the other is the Civil Service. Since 1948, Civil Service pay, I understand, has been increased three times. As the pensions of civil servants and their widows are dependent upon the Civil Service pay, that means that Civil Service pensions have been increased three times in the last three years. Why has there been no increase at all in the pensions of officers of the Armed Services? I am not decrying our civil servants. I believe that the British Civil Service is the finest in the world, but he would be a bold man who would say that service in a chair in Whitehall is of greater moment to the State than service in Korea, or in the last war. Certainly, in the case of service in Whitehall one would imagine that the risk to life and limb is nothing like so great. I am afraid the real reason for the present state of affairs is that in this country we have never treated old soldiers with the consideration they ought to have. This goes for all soldiers at all times, however far back you go in history.

We on this side of the House would most certainly support a movement to recognise adequately the gallant service of these old soldiers, and in this I feel certain that we have the support of the noble and gallant Earl who is going to reply for the Government. No one, I am sure, could possibly wish to do more for his old comrades than he who led them with such gallantry and success out of Dunkirk, out of Burma, and in North Africa and Italy. I am certain that the noble and gallant Earl is on our side, however much he may have to talk from a brief here. I would ask him to throw aside the brief, if he can, and to answer from his heart, and to give to the old soldiers who have served their King, their Queen and their country with such gallantry in the past the consideration which is warranted by their great merits.