NATIONAL HEALTH SERVICE (SUPERANNUATION) (AMENDMENT) REGULATIONS, 1962 (Hansard, 26 July 1962)

§ LORD NEWTON
My Lords, I beg to move that these draft Regulations be approved. The draft Regulations for Scotland are similar, and it may therefore he convenient to your Lordships to discuss both together. If that suggestion meets with your Lordships' approval, then my noble friend Lord Craigton will move the Scottish Regulations formally. The main provisions are contained in Regulations 3 and 4. Regulation 3 provides for early retirement with accrued pension and lump sum benefits in two circumstances: in 1137 the event of redundancy, and in the event of an officer's retirement in the interests of the efficiency of the National Health Service.
When we debated the Hospital Plan for England and Wales earlier this year, I explained that, as the Plan is carried out, it should rarely be difficult to find other employment for displaced staff within the Service. Indeed, special arrangements have been made for cooperation between employing authoirties to help to ensure that displaced staff are absorbed elsewhere. Nevertheless, it is only right that provision should be made to meet any exceptions which may occur. Accordingly, Regulation 3 secures that, Where an officer has 'had ten years' service and has attained the age of 55, he shall be able, if retired on the ground of redundancy, to receive at once his accrued pension and the lump sum payment to which he is entitled. The line of 55 years of age has been chosen because it is in accordance with the general practice of the public services, where 55 is the minimum age for paying pensions of this kind.
The pension and the lump sum benefits will not be subject to an actuarial reduction to take account of the earlier age at which they are paid. They will, however, be reduced to take account of the redundancy compensation which has been paid. This seems to be both logical and fair. The same provisions will apply in the case of officers who are retired early in the interests of the efficiency of the Health Service. Such cases should not be numerous, but if an elderly officer finds that the strain of coping with his work is too great, it will be an advantage to him and to the Service that he will be able to retire earlier on pension. The fullest safeguards will be applied, including the right to a personal hearing by the employing authority in the presence of two assessors, one of whom will be appointed by the Minister. The Minister will make the final decision, after receiving a full report from the employing authority and the views of the assessors, if there has been a hearing.
Regulation 4 provides for an improvement in the scales of benefit in respect of service as a practitioner. In 1955 the Government Actuary reported that the superannuation contributions of practitioners who had entered at the normal 1138 age were at a higher level than was necessary to finance their superannuation benefits. At that time, the great majority of practitioners in the Health Service had entered at later than normal age. Since that time the proportion of normal age entrants has increased substantially, and the Government consider that the relationship between contributions and benefits should now be corrected. That being so, two alternatives are open: to reduce the contributions, or to increase the benefits. The professions are unanimous in preferring the latter, and that is what this Regulation does. It provides that, as from September 1, the pension of a practitioner will be at the annual rate of 1¾ per cent. of his total remuneration. The existing rate of l½ per cent. will apply to the remuneration paid up to that date. The lump sum benefits will be raised equivalently.
Both these Regulations, Regulations 3 and 4, have been fully discussed with the professions concerned, and one or two modifications have been made to meet some of their points of view; we have not been able to meet all of them. However, these Regulations are very much to the advantage of those who contribute to the Health Service Superannuation Scheme by giving entitlement to pension in new circumstances and by providing better benefits for practitioners. Therefore I commend them to your Lordships. I beg to move.

§ LORD BURDEN
My Lords, the noble Lord has explained these draft Regulations in his usual lucid manner, and I do not propose to object to or to oppose the Regulations. Indeed, so far as they go, they are to be welcomed. But I would suggest to your Lordships that they have to be considered in relation to the problems of redundancy in the National Health Service arising from the Hospital Plan. Here I agree with the noble Lord. As I know from my own experience, every effort is being made in the Service to reduce redundancy to a minimum; but these draft Regulations indicate that some redundancy appears to be inevitable. I will 1139 not develop that point, but I happen to have heard opinions which indicate that it is possible that redundancy, despite every effort made to avoid it, will occur.
I do not propose to discuss the general provisions for redundancy as outlined in a recent administrative circular, except to say that officers in the National Health Service are both alarmed and worried that the new Regulations in the administrative circular are, on the whole, a definite worsening of the terms which have applied to the National Health Service since its inception until two years ago. So far as the present draft Regulations are concerned, I welcome the reduction to 55 as the age when superannuation, in the circumstances outlined by the Minister, may be drawn. I know, of course, the arguments for the age of 55; but, bearing in mind what I have said with regard to the general worsening of all conditions in the administrative circular, it is quite possible that an officer may have had or given 24 or 25 years of loyal and devoted service, and had that to his credit, but if he happens to be under the age of 55, and should his post be declared redundant, he would be entitled, as I understand the position, merely to a refund of superannuation contributions and the terminal allowance, if there happens to be no appropriate post for him in the National Health Service. This does not appear to me to be very satisfactory. In fact, it seems to be both unfair and unjust, bearing in mind what I have said in regard to the worsening of conditions as outlined in the administrative circular.
I do not wish to comment on the second point raised by the noble Lord—that of compulsory retirement for inefficiency—as the Minister in another place gave what seems to me to be fairly satisfactory assurances on the manner in which these cases would be considered, especially the assurance that the officer concerned could be accompanied at the inquiry by a friend or trade union representative, if he or she so desired. We have always to bear in mind that inefficiency may not be due to any inherent weakness on the part of the officer concerned, but to stress and strain and ill-health arising from those conditions.
1140 Finally, while expressing appreciation of the draft Regulations so far as they go, I am bound to say, again speaking from my own knowledge, that there is both apprehension and dismay in the Service at what has been rightly described as a parsimonious worsening of the general provisions for dealing with redundancy as a whole. I agree that the draft Regulations before us make some slight improvement. Of course, we cannot discuss the broad problem on these Regulations, but I thought it only fair and right, knowing the position, that I should bring before your Lordships the fact that while staff and associations accept these Regulations, and although, as the Minister said, the regulations do not concede all that they require, they are fully conscious of the serious apprehension in the Service as a whole about the worsening of conditions which, so far as the National Health Service is concerned, have obtained from its very inception.

§ LORD NEWTON
My Lords, I am very glad that the noble Lord, Lord Burden, has admitted that these draft Regulations are an improvement. Of course they are, and they could not possibly be represented as anything else. He made some observations about redundancy generally and about compensation for redundancy. I suppose he was talking about the system of terminal payments. But, of course, these Regulations have nothing to do with that, except in one or two minor respects.

§ LORD BURDEN
They will apply, of course, to a man who is under the age of 54?

§ LORD NEWTON
My Lords, the Regulations are concerned with officers who have reached the age of 55, which is another way of saying what I was saying before the noble Lord interrupted. In my opening speech, I explained why the line has been drawn at the age of 55. It is in accordance with the general practice of the public service. Wherever one draws a line, in some sense it is arbitrary, and in the opinion of Her Majesty's Government 55 years is the right line at which to draw in these regulations. I hope that with that explanation your Lordships will see fit to agree to these Regulations.