HL Deb 30 July 1953 vol 183 cc1157-65

2.58 p.m.

THE EARL OF SELKIRK rose to move, That the British Transport Commission (Compensation to Employees) Regulations, 1953, reported from the Special Orders Committee on Thursday the 16th instant, be approved. The noble Earl said: My Lords, may I bring you down to a much more parochial subject? I rise to move this Motion, the object of which is to enable the Minister of Transport to make regulations to pay compensation in certain cases which arise under the Act. These regulations have accordingly been submitted for the approval of both Houses. They are intended to meet the requirements of employees who suffer loss of employment or loss or diminution of emoluments arising from one of three causes: first, the disposal of property held by the Road Haulage undertaking; secondly, modifications of the functions of the Commission, such as the Commission's reduced responsibility in regard to the ports and harbours of this country; and thirdly, the reorganisation of the railways.

These regulations follow generally the pattern which has been set up in the past and, of course, in particular, the regulations of 1948 and 1950, affecting respectively railwaymen and persons employed on road haulage. The Minister undertook to put these regulations before Parliament before disposal begins, and secondly, to do so after consultation with the trade union organisations concerned. Both these undertakings have been fulfilled, and I think I can say that it is both a matter for satisfaction and, indeed, of something of an achievement for the Department, that the regulations have come forward for approval within three months of the passing of the Act.

If it is convenient to the House I will explain generally the manner in which these compensation regulations will operate, and I will note some of the differences from previous regulations. Afterwards, I will endeavour to answer any questions that your Lordships may wish to ask. So far as the railwaymen are concerned, in the first place these regulations follow very closely those of 1948. There are, however, one or two minor, though still significant, improvements, which I will mention shortly. First of all, the claimants may go straight to the tribunal, instead of going through the Commission. Secondly, ill computing interim payments only two-thirds of the earnings are to be set off, instead of the whole of the earnings. Thirdly, in setting off unemployment or insurance benefits no account would be taken of dependants' and wife's allowance. So far as road haulage is concerned, there are very material improvements in the conditions. Under the 1950 regulations, in order to get long-term compensation a man had to show expectation of compensation to retiring age in the event of discharge. This requirement has, in fact, proved almost an insurmountable barrier to the claimants. I am told that there are not more than six who have been able to establish a claim at all. These regulations are, therefore, put on a different basis, and the basis we have put it at is that a man must be able to show settled employment for a period of eight years, either with the Commission or with the previous employer whose business the Commission has taken over. These conditions are considerably easier for road haulage employees than those the previous regulations laid down.

The terms of compensation fall broadly under two heads—resettlement payment, which is to enable a man to get settled in his new job, and long-term compensation. Resettlement payment is payable to anyone who has been three years in the service of the Commission or, in any case, has held a permanent appointment since the beginning of 1952. I should like to compare this with the short-term compensation of the previous regulations which required a minimum of eight years in order to qualify at all. It will be payable for thirteen weeks plus an additional week for every year of age over forty-five up to a maximum of twenty-six weeks, and this is one of the examples among others in which the regulations are weighted in favour of the older people. The rate of payment will be at two-thirds of the loss, calculated on the current net emoluments at the time when the loss occurred. This will, of course, include anyone who is holding acting rank at that time.

Long-term compensation will be payable for those who can show eight years' continuous service. Continuous service will not be considered to have been broken by periods of National Service. It will be calculated at one-sixtieth of the current rate of emoluments for every year of service, and two-sixtieths for every year of service over the age of forty-five, again weighting the regulations in favour of the older men. Interim payments may be made pending the settlement of long-term compensation, but a decision on the matter must be reached within thirteen weeks. Any appeals can be made to a tribunal set up under the Ministry of Labour.

Paragraph 16 of the Second Schedule deals with pension rights in one particu- lar sphere. It makes it possible for the Commission to add an additional year of pensionable service for every year of service over the age of forty. This means, in effect, that any man who has served for thirteen years over the age of forty will be assured of almost his full pension rights on reaching the age of sixty-five—that is, in accordance with the length of the service which he has given. I might further mention that the general regulations for pensions under Section 27, which deals with pensions, are in an advanced stage of preparation, and are now being considered by the trade union organisations.

We are confident that the changeover under this Bill will be smooth and, accordingly, that few people will need to fall back on these regulations. At the same time, I can say in recommending them to the House that so far as the railwaymen are concerned they are as good as, and, if possible, slightly better than, those at the time of nationalisation. With regard to the road haulage employees, they are very much more favourable, and in asking the House to approve these regulations I suggest that they go as far as is reasonably possible to meet cases of hardship arising from the changes. I beg to move.

Moved, That the British Transport Commission (Compensation to Employees) Regulations, 1953, reported from the Special Orders Committee on Thursday the 16th instant, be approved.—(The Earl of Selkirk.)


My Lords, I should like to thank the noble Earl for his usual careful exposition of the matter before your Lordships' House and also to acknowledge that the Minister of Transport has done his best, I think, to secure the largest measure of agreement with the trade unions concerned. It is a little unfortunate that full agreement was not reached, as it might easily have been by the concession of one or two minor points which I shall venture to submit to your Lordships in a few moments. Before I do so, however, I should make it perfectly clear that compensation for loss of office directly as a consequence of legislative action has a very long history in this country. It goes back for nearly a hundred years. The Civil Service Superannuation Act of 1859 in Section 7 conceded the principle. Again, it was conceded in the Local Government Act of 1888 which set up the county councils, but it was not until 1933, after nearly a quarter of a century's hard work, that a code was included in the 1933 Act for local government officers.

I refer to that deliberately because I should like to refer to a personal contact I had with compensation regulations more than thirty years ago when I was a member of the executive committee of the trade union principally concerned. I refer to the fight which was put up in a Committee Room of another place when the Railways Act, 1921, was being considered upstairs. I well remember the work which was put in by the right honourable William Graham, Member of Parliament for Central Edinburgh—or, as he was affectionately known to us, Willie Graham. I am bound to admit, as the noble Earl has, that that code was to some extent worsened in the compensation arrangements included in the nationalisation Acts of the Labour Government from 1945 to 1950. Again, it would be quite wrong if I did not admit readily that these regulations are in a few details an improvement on what was included in those compensation clauses in the nationalisation Acts.

In considering that aspect of the matter I would submit that these regulations deal with an entirely novel set of circumstances. Let me make this perfectly clear. Over a fairly long experience of compensation regulations I have never had much regard for what I may call the money value aspect of compensation. Compensation provisions, both in the Railways Acts and in other Acts, have always acted as a deterrent against indiscriminate dismissals in the changeover from one form of administration to another, because if compensation flowed from dismissal obviously every reasonable effort would be made to organise the business to prevent dismissal. Clearly, no employer, whether it is the State or a local government body, would pay two-thirds of a man's salary by way of compensation if by some slight reorganisation of the business, the slowing up of recruitment or something like that, they could find a place for him. Therefore, broadly speaking, compensation provisions prevented people from being ruthlessly dismissed to suffer unemployment.

But in the main these compensation provisions arise front the handing back for private profit—the working under private enterprise, if you like—of the nation's assets in road transport, which I have heard people refer to as a rare and refreshing fruit resulting from the Tory victory at the last Election. The people acquiring the physical assets of the nationalised road transport would not care a brass farthing about those whom they do not want to employ. They are not paying the compensation. That is the distinct difference as between compensation under the old Acts and compensation under these regulations. I know that the compensation is to be paid out of the transport levy. But who is paying the transport levy?—only the road operators. The levy has also to provide for other things than the payment of compensation, as the noble Earl well knows. Therefore, I venture to say that while I readily admit that these regulations are an improvement, obviously they would be very wicked indeed if they were not an improvement, because of the changed set: of circumstances. They are dealing with a position in reverse as compared with the other compensation regulations.

I think the noble Earl is already aware of the points which I should like to put to him. First, we think that the period of thirteen weeks which might reach twenty-six weeks is not long enough, and that there should be a maximum of fifty-two weeks. Then we feel, as do the trade unions, that the date should be brought forward a little and that the compensation provisions should apply as from May 1, the date of the Government White Paper, when it was first made clear what the Government's policy should be. I venture to think that that will not mean very much in hard cash or compensation of any kind, but it would be a fair deal. My final point has already been touched on briefly by the noble Earl. I may be wrong, but, as I understood him, he said that the compensation would be based upon the rate of pay or the salary at the time. That would cover, shall I say, only acting appointments which are in operation, where the difference between the old and the new salary was carried as a difference of ray. That would apply, broadly speaking, to the whole, and not only to road transport, because there may be a difference in pay regulations so far as the railway side of the industry is concerned.

I suppose that if we took the Explanatory Memorandum, we might discuss this afternoon the broad position flowing from the announcement of the Minister of Transport that he was dispensing with all the Executives except the London Transport Executive; but in an atmosphere such as we have this afternoon, and just as the House is rising, and as these regulations will come into operation before the House resumes, I think it would be far easier to postpone comment on that action until we can have a set debate on the question. As is the normal practice in your Lordships' House, it is not our intention to press our objection to these regulations to a Division, but we feel that we should voice here what those objections are. If they had been put right they would have carried the good will of the trade unions concerned.

3.18 p.m.


My Lords, I should like to thank the noble Lord, Lord Burden, for so frankly acknowledging that these are the most advantageous conditions of compensation which have ever been presented to Parliament.


I would ask the noble Earl to quote me accurately. What I said was that they were an improvement on the worst code—which was a very different thing.


They are an improvement on anything which any Socialist Government has ever presented to Parliament: there is no doubt about that. Whether the noble Lord agrees or not I do not mind, but that is a fact. I am grateful to him for drawing attention to it and I think we all appreciate it very much. I do not want to detain your Lordships by explaining the advantages in detail, but, as I have said, there are one or two small but still significant improvements throughout the whole range of these regulations.

The noble Lord mentioned three points particularly on which he would like some further information and with which I should like to deal. First, he has suggested that the resettlement period should be fifty-two weeks. In examining that, one must remember that there has never previously been a comparable period of resettlement. The 1950 regulations required a period of eight years' service before a person qualified for short-term compensation. He can now get short-term compensation after a period of two years' service. It is much more easy to get than it was at an earlier date. If the noble Lord's suggestion for fifty-two weeks' payment were adopted and a man were unemployed for that time, it is conceivable that someone would get a year's compensation after two years' work, which, I must say, is pressing the point a little far when we are dealing with public money. I think it would be over generous—certainly much more generous than any Government has ever attempted to be before. This is meant only to be a period of resettlement, and I suggest that for people under forty-five years of age thirteen weeks is quite a reasonable period, while for those above that age the period is up to twenty-six weeks—approximately six months. I think that this is a reasonable method and it is in line with previous regulations.

The noble Lord also said that he would like the period of qualification to run from May, 1952, instead of from January, 1952. I admit that that is a fairly short period, and for that very reason I wonder why the noble Lord makes so much fuss about it. It is not a long period. There was no doubt at all of the position after the present Government took office, after the King's Speech in the autumn of 1951, in which it was laid down quite clearly what was going to happen. I will read the passage. It is as follows (OFFICIAL REPORT, Vol. 174, Col. 8): Proposals will be made to facilitate the extension of private road haulage activities. The Home Secretary said (OFFICIAL REPORT, Commons, Vol. 493, Col. 720): Whatever else honourable Members opposite may have doubt about, they cannot have any doubt about our intentions in this matter. They are set out quite clearly in our election documents, and our intention is, as it has always been, to diminish the monopolistic powers of the British Road Transport Commission… Anyone who after that went into the Road Haulage undertaking of the Transport Commission must have done so with the knowledge that there was a measure of uncertainty with regard to its future. We have taken a date after these speeches—that is to say after the King's Speech and after the debate on the Address—and put it at the end of December, 1951. I think it is a very reasonable date from which eligibility for compensation should run.

The third point which the noble Lord raised was the question of "acting pay." I have dealt with that already, and I think that what I have said covers the matter. Compensation applies to the current rate of emoluments at the time the loss occurs. All that is taken off are additional payments, perhaps for travelling, subsistence allowances, or anything of that kind. The current rate of pay at the time when the loss occurred is the effective basis. I hope that that meets the point which the noble Lord raised. The noble Lord says he would like the full agreement of the trade union organisations to have been obtained. I wonder whether the trade unions realty would like to be in a position to say that they got full agreement—to say that they had not asked for anything more than they had got. They are born negotiators, and they want to get as much as they possibly can for their members. That is only human nature. I think we can assume that the trade unions in this matter are not ill-satisfied with the outcome of the negotiations which they have conducted.

On Question, Motion agreed to.