HL Deb 03 May 1956 vol 197 cc119-28

3.10 p.m.

Order of the Day for receiving the Report of Amendments read.

THE CHANCELLOR OF THE DUCHY OF LANCASTER (THE EARL OF SELKIRK)

My Lords, in moving that this Report be now received, may I refer to one of the Amendments which was put down on Committee stage in the name of the noble Lord, Lord Burden, but which is not on the Order Paper to-day—namely, the Amendment he put down to the Second Schedule, paragraph 7. I agree that this is rather a wide paragraph and its purpose is to enable the structure of the Bill to be "tailored" a little in certain cases where otherwise a category of pensioners might be dealt with a little harshly as compared with other pensioners. We have to remember that in this Bill we are dealing with a large number of pensioners—about 300,000 to 400,000, whose conditions of service and pension terms vary widely. In order to deal with them all in precise equity, it would be necessary to have a Bill running not to thirteen clauses and five Schedules but probably to three or four times that number. Accordingly, we have inserted this paragraph which will enable the roughness to be evened out in certain cases.

I think perhaps I can make the matter clear by giving a simple example. Apart from any regulations made under this paragraph, the professional stipendiary magistrates would have a cut-off date on December 31, 1947—that is to say, they would not be eligible for any increase in their pensions if they retired after that date. But their salaries and their rate of pension had remained virtually unchanged since before the war and were not increased until 1951. In such circumstances as this, the cutoff date for this category of pension would be brought forward to 1951. This would enable all those retiring at the old rate of pension to receive pension increases, while those on the new, higher rates of pension would not qualify. To sum up, the intention of this paragraph is to give fair play to all concerned. The noble Lord, Lord Burden, has asked me for an explanation. I hope that he will be satisfied with what I have said. I beg to move that this Report be now received.

Moved, That the Report be now received.—(The Earl of Selkirk.)

LORD BURDEN

My Lords, may I first thank the noble Earl for his explanation? The intention of the Amendment to which he referred was to endeavour to make sure that the benefits provided in the Bill were not cut down. But having received the assurance that that is not the purpose of paragraph 7 of the Second Schedule, it being a mere matter of adjustment of the kind indicated by the noble Earl, I do not intend to raise the matter any further. It is understood that there will be no whittling down at all; it is just that broad justice should be done. With regard to the Amendment now on the Marshalled List, it will be within the recollection of the House that a similar Amendment was down—

THE LORD CHANCELLOR (VISCOUNT KILMUIR)

My Lords, if the noble Lord is going on to the first Amendment the House will wish first to pass the noble Earl's Motion that the Report be received. May I put that to the House?

On Question, Motion agreed to. Bill reported with Amendments.

Clause 1:

Increase of pensions specified in First Schedule

(2) Subsections (2), (3), (4) and (6) of section one of the Act of 1944 (which define the circumstances in which a pension may be increased under that section) shall apply for the purposes of this section as if any reference in those subsections to the said section one included a reference to subsection (1) of this section; and, subject to the next following subsection, in the application of those subsections for the said purposes, the expression "dependant", in relation to a pensioner, shall be construed as meaning a person who the pension authority are satisfied is wholly or mainly supported by the pensioner and who either has not attained the age of sixteen years, or, having attained that age is [(and except for any period of whole-time service in the armed forces of the Crown under the National Service Acts, 1948 to 1955, has at all times since attaining that age been)] either receiving full-time instruction at an educational establishment or undergoing training for a trade, profession or vocation in such circumstances that he is required to devote the whole of his time to that training for a period of not less than two years.

(3) Where, immediately before the appointed day, an increase under the Acts of 1944 and 1947 or the Act of 1952 was payable in the case of a pension by reason only that some person was a dependant of the pensioner by virtue of subsection (5) of section one of the Act of 1944, then, so long as the pension authority are satisfied that that person continues to be wholly or mainly supported by the pensioner, that person shall be deemed to be a dependant of the pensioner for the purposes of the application of subsections (2), (3) and (4) of section one of the Act of 1944 to increases under subsection (1) of this section:

Provided that—

  1. (a) this subsection shall only apply to a person by virtue of paragraph (a) of the said subsection (5) so long as that person would continue to be a dependant of the pensioner under the last foregoing subsection if the words from "and except" to "been" and the words from "in such" onwards were omitted therefrom;
  2. (b) where this subsection applies to any person by virtue of paragraph (b), (c) or (d) of the said subsection (5) and an increase under subsection (1) of this section is payable in the case of a pension by reason only that that person is deemed under this subsection to be a dependant of the pensioner, the annual rate of that increase shall be reduced in respect of any period by the amount, if any, by which the pension authority are satisfied that the annual rate of the total income in that period of that person from any other source exceeds one hundred and fifty-six pounds a year.

LORD BURDEN moved to leave out, in subsection (2), all words after "sub-section (1) of this section", and the whole of subsection (3), and to insert instead: (3) For the purposes of this section and of the First Schedule to this Act, the expression 'dependant' means, in relation to any pensioner, any person other than the pensioner with respect to whom the pension authority are satisfied that he is wholly or mainly supported by the pensioner being either—

  1. (a) a person who has not attained the age of sixteen years, or who, if he has attained that age, is receiving full-time instruction at any educational establishment or is undergoing training for any trade, profession or vocation; or
  2. (b) the father, mother, brother, sister, child, uncle or aunt of the pensioner, or of the husband or wife of the pensioner, or of the deceased husband or wife of the pensioner; or
  3. (c) the child of any such person as is mentioned in the last foregoing paragraph; or
  4. (d) the stepfather or stepmother of the pensioner;
and in this subsection the expression 'child' includes, in relation to any person, a stepchild, an illegitimate child and a child adopted by him in pursuance of an adoption order made under the Adoption Act, 1950, or any corresponding enactment of the Parliament of Northern Ireland, or adopted by him in accordance with the law of the place where he was domiciled at the time of the adoption. In calculating, for the purposes of this subsection, the income of any such person as is mentioned in paragraph (a) thereof, no account shall be taken of any income accruing to that person as the holder of a scholarship or other educational endowment: Provided that where this subsection applies to any person by virtue of paragraph (b), (c) or (d) and an increase under subsection (1) of this section is payable in the case of a pension by reason only that that person is deemed under this subsection to be a dependant of the pensioner, the annual rate of that increase shall be reduced in respect of any period by the amount, if any, by which the pension authority are satisfied that the annual rate of the total income in that period of that person from any other source exceeds one hundred and fifty-six pounds a year.

The noble Lord said: My Lords, it will be within the recollection of the House that on the Committee stage a similar Amendment to that now appearing on the Marshalled List was not moved and it was agreed that there should be consultations with the noble Earl, Lord Selkirk, in connection with the points then raised. I am happy to say that, with the noble Earl's usual courtesy, those discussions took place, and on one point the case submitted has, think, been partly met by two Amendments which stand in the noble Earl's name later in the Marshalled List. Those relate to the position of trainees. Unfortunately, Her Majesty's Government have not seen fit to meet what I believe was the very real case submitted to the noble Earl, and therefore, much to my regret, I have to ask your Lordships' indulgence while I endeavour to prove the justice of the case set forth in the Amendment. I will deal only with persons not covered by the noble Earl's latter Amendment, on the assumption that that Amendment affects a pensioner who is either a young or middle-aged widow or an elderly lady approaching the age of sixty who is struggling to maintain on a small pension a near relative wholly or partly dependent on her. Surely people falling within those categories are not those whom one would expect to find treated less generously in a Bill of this character, when the means test is being abolished—aid I readily grant that Her Majesty's Government are making substantial improvements for other pensioners.

In the Second Reading debate the noble Earl agreed that the word "dependant" had been narrowed somewhat, but the case I submit to your Lordships is that there is no ground for treating less generously these hard-hit female pensioners, for whom, indeed, one could well make out a case for more, and not less, generous treatment than they receive under the Bill as it stands. Your Lordships will be aware that under previous Acts dealing with pensions increases (those of 1944, 1947 and 1952) a pensioner who was a widow under forty or a lady under sixty was entitled to pension increase only if she was wholly or mainly supporting a dependant as defined in Section 1 (5) of the main Act of 1944. That entitlement was subject to a means test, in respect of a figure of £52 and then, under the 1952 Act, of £104.

I submit that it is not wholly unreasonable to have hoped that this means test—now based on a figure of £156—might have been entirely wiped away in this Bill, which abolishes means tests for other classes of pensioners. By the Bill the income limit has been abolished in respect of female pensioners making a claim for pension increase for the first time when this Bill becomes operative. The existing definition has operated, and so far as I am aware, operated fairly satisfactorily, under the previous Acts, and I cannot for the life of me see why a young widow or an elderly lady struggling to maintain on a small pension herself and perhaps an infirm old father or other near relative should now be penalised; or if that be too harsh a word, why she should be denied benefits now made available under this Bill. As was put to us, it may well be that female pensioners now affected by the definition of "dependant" are limited in number, but if that is so, surely that is not a reason for depriving them of the increase; rather, I should think, the matter ought to be looked at in the other way. I understand that the cost to the pension authorities would not be very large. Is it worth while for a relatively small sum to leave with a sense of hardship or injustice these people to whom I have referred?

It was put, I believe with force, by the National Advisory Committee for the Local Government Services of the Trades Union Congress, when they saw representatives of the Treasury on February 17 this year, that the people concerned are such female officers as nurses, health visitors and matrons of children's homes who, under present superannuation Acts, have the right to retire at fifty-five. Those framing the superannuation schemes rightly thought that the nature of the employment—particularly of nurses, those in mental hospitals and so on—was such that at the age of fifty-five they were really due for retirement. I am sure that noble Lords will realise that a woman of fifty-five may have someone dependent upon her. In those circumstances, on a reduced income arising from superannuation, the struggle is likely to be pretty grim. It has been urged that the new Bill abolishes any means test restriction and therefore that the pensioner might enjoy a very large income and be able to support a dependant and so be eligible for an increase without deserving one. It has already been said, and agreed, that the number of pensioners affected is likely to be small. As to the number with very large pensions, I am aware, from my knowledge of the rates of salaries in the local government service, that the superannuation received is not likely to be of a very substantial kind.

The other persons affected will be those receiving widows' or allocated pensions. Neither widows' pensions nor allocated pensions can exceed one-third of the pension of the husband or allocator. Speaking from experience of the association in contact with these people, I can say that the other income is never likely to be very large. In any case, that could be dealt with, I believe, if it were feared that someone would be getting money in a case where it would not be necessary. Again, it is urged that a pensioner may also be receiving a National Insurance pension. My reply to that is quite simple. The retirement pension is not payable before the age of sixty; nor is unemployment benefit payable if the person concerned is not seeking employment. And, of course, a widow under the age of forty is entitled to a pension only if she is left with a child. That is provided for in the Family Allowances Act of 1945. A third objection raised is that a dependant may have means of his own. I put it to your Lordships that the local authority responsible for administering this Bill, when it becomes an Act, will be aware from their own knowledge of the circumstances. If that were the case they would clearly be able to deal with the position.

I apologise for speaking at such length on this matter, but I can assure your Lordships that while it might not seem of very great importance to you, and while the number of persons concerned is not likely to be very large, that is not a reason for depriving these people of the benefits of this Act. I urge the noble Earl to have a look at this matter again, and at any rate to give us some more substantial reason why these increased benefits should be denied to these people. I beg to move.

Amendment moved— Page 2, line 8, leave out from beginning to end of line 3, on page 3, and insert the said new words.—(Lord Burden.)

3.26 p.m.

THE EARL OF SELKIRK

My Lords, I do not think there is any more invidious task in this House than to try to explain the limits of a pensions increase scheme, because necessarily we all have the deepest sympathy and regard for those who are pensioners. These people necessarily are not extremely well off; in fact very often they are badly off. My task is the more difficult because, like so many of these things, the matter is exceedingly complicated to explain at all. This makes it all the more easy to give a slightly false impression. Frankly, what the Government are doing is trying equitably to improve pensions within a certain figure (a figure of about £12 million has been allocated), and it has been sought to make that money available for pensions increases as equitably as can reasonably be done.

I really do not think it is fair to say that this Bill penalises anyone or causes injustice. There are, as there must always be in the case of pensions, people who fall on one side of the line and people who fall on the other side. I am afraid that in the circumstances that is quite inevitable. The noble Lord has raised this point, and, if I may say so with great respect, I am still not quite convinced that he understands exactly what we are doing. I wish I was absolutely convinced that I knew myself. As I say, it is a complicated matter, but I will try to put it as clearly as clearly as I can because I think the Bill is more generous, shall I say, or covers a wider section of people than the noble Lords seems to think. We have agreed here that the only point he is raising is in regard to widows under forty and women who have retired in their own right under sixty.

LORD BURDEN

From fifty-five to sixty.

THE EARL OF SELKIRK

So far as children are concerned—the noble Lord has not dealt with them—we have broadly come to an agreement. I am moving an Amendment in a few minutes' time which will not cut a child out in the event of a break in the education. I looked at the period of education of two years, and it seemed to me that for anyone undergoing a period of education of less than, two years the education they received would not be a very serious one. I think we want to encourage people to take some form of serious education.

Now we come to the other point, that of a pensioner who has been maintaining, say, an infirm relative of some kind The first thing I should like, the noble Lord to be clear upon is this. Anyone who is already receiving any benefit under the 1952 Act will get a 10 per cent. increase straight away. It is very important to appreciate that, because that means that there are not many people who retired before 1952 who fall into the category which the noble Lord has in mind and who will not be receiving some increased pension under the 1952 Act and accordingly will not get a 10 per cent. increase automatically under this measure. I have looked at this matter and, so far as I can see, the only people who fall into that category would be pensioners whose outside income was so high that they were excluded by the means test in the 1952 Act, or dependants who had outside means which brought their income to such a level that they are excluded from benefit under the 1952 Act. All the people below that level would come under the 1952 Act and would be cut off, except for averaging, under the Act. So that those who already receive that benefit would automatically get 10 per cent.

Therefore, I am forced to the conclusion that the people affected by this Amendment must be very few and almost all of them must have some outside means. As the noble Lord says, it is true that something may happen in the future, but I think we have to recognise frankly that here there is an element of compromise. When this Bill was put forward, great pressure was brought to bear to abolish the means test, and, as the noble Lord knows, that has been achieved. I think we are all glad about that. There has been a great sense of relief. It has many advantages, including great administrative simplification. It means that when a pensioner gets to sixty, he will get his increase regardless of the means of his dependants. If we granted increases for those under sixty, I think it would be difficult to do so without imposing a means test of some kind. The noble Lord says that we can trust the local authorities. I do not say that we cannot trust them, but, after all, it would put them into an invidious position to have to decide whether a person is dependent or not without any means test at all. I think that Parliament would have to face this squarely and put into it a means test of some kind. We have not done that and, on the whole, I think the method we have chosen is the fairest way of doing it, and the only way of keeping a means test out of future legislation. I do not pretend that this explanation is clear or simple, but I have gone into this matter with the noble Lord and have since looked at it again. Whilst I admit that there are always bound to be hard cases just outside the borderline, I think there is a strong logical case for the line the Government have taken. I think the noble Lord will find that those who are already within the scope of the 1952 Act will get the 10 per cent. and there will be very few of those hardest hit who did not get benefit and who conceivably could come into this measure. I have gone so far as I can to meet the noble Lord in the other matter and I hope he will not press this Amendment any further.

LORD BURDEN

My Lords, with the leave of the House, I should like to say that I am grateful to the noble Earl for what he has said. I know it would be useless to pursue this matter much further in view of the line that he has taken. All I can say is that I profoundly regret that such hardship as will arise under this Bill through drawing this line will fall on the hardest-worked category of female labour in local government service, who will not be able to retire at fifty-five and will have to go on until they are sixty to get full pension. I beg leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

THE EARL OF SELKIRK moved in subsection (2), to leave out all words in parentheses, beginning "(and except for" down to "been"). The noble Earl said: My Lords, this is the Amendment to which I have already referred. The noble Lord, Lord Burden, advanced the view that a break in education should not necessarily remove the benefit of education, and this Amendment takes out the necessity for education to be continuous. I hope that this meets the noble Lord's point. I beg to move.

Amendment moved— Page 2, line 14, leave out from ("is") to end of line 16.—(The Earl of Selkirk.)

LORD BURDEN

My Lords, I am sure that the noble Earl appreciates that I had not intended to deal with this Amendment and I only mentioned it in my previous speech. I readily recognise that the noble Earl has gone as far as he could in this Amendment. It does not give us all we ventured to ask for, but it goes some distance along the way; and for that we are grateful.

On Question, Amendment agreed to.

THE EARL OF SELKIRK

My Lords, I beg to move the next Amendment.

Amendment moved— Page 2, line 36, leave out from ("if") to ("the") in line 37.—(The Earl of Selkirk)

On Question, Amendment agreed to.