HL Deb 09 July 1971 vol 321 cc1283-317

2.55 p.m.


My Lords, I rise to move the Second Reading of this Bill. I should like, if I may, to take the unusual step of starting with a quotation. For brevity, I will omit a good deal. It is as follows: My Lords, I have to ask your Lordships to give a Second Reading to a Bill to authorise the increase of certain pensions. It is quite unnecessary to labour the point that, owing to the great rise in the cost of living during the last few years pensions…which might…have afforded a more adequate means of livelihood…now entirely fail to meet that object. This matter was brought before the Cabinet…. The Bill was introduced into the House of Commons authorising the increase of pensions. That Bill passed through another place and is now before your Lordships…. If this Bill is passed, the total cost…of the increase of pensions is estimated at not more than £850,000 in the first year. The Bill does not provide for the increase of naval and military pensions, but additions to those pensions corresponding to those provided in the Bill will…be made in the ordinary constitutional manner by Order-in-Council and Royal Warrant…"—[OFFICIAL REPORT, 10/8/20; cols. 1161–3.] That quotation was from a speech in this House by Lord Hilton, who was then Minister without Portfolio, nearly fifty-one years ago, in moving the Second Reading of the first Pensions (Increase) Bill in 1920. Add two noughts on to the cost, and a suitable obeisance to the Royal Air Force, and there, on the face of it, we seem to have this year's Bill, too. The Bills are superficially similar, but in practice—and I mean both in principle and in detail—they are in fact utterly and completely different.

I am very glad that the noble and gallant Lord, Lord Bourne, will be speaking in this Second Reading debate. He has been until recently Chairman of the Officers' Pension Society. All those who have been in the firing line—in the noble Lord's steady sights; and they include my noble friend Lord Carrington and the noble Lord, Lord Shackleton—know how much skill, time and sheer dogged energy the noble Lord has deployed in hunting down his Ministerial prey, in furthering the legitimate interests of Armed Forces pensioners. And I am glad that other noble Lords, very well qualified to hold a brief for the civil public service—home and abroad—will be speaking in this debate which I hope (and I shall try not to be an offender) will not be too unnecessarily long.

Before I get down to the Bill, may I say that there is a particular reason why I have pleasure in moving it. First, I believe this to be a good Bill; and not only in parts. Secondly, I believe that the Bill commands wide support from all quarters: we have had more than our normal Lordly ration of Party political business this summer. Thirdly, because it springs from the loins of my own Department—the Civil Service Department. There is a fourth reason, which derives from the third. I should like to acknowledge very warmly the extensive contribution in this sphere, among many others in public service management, which the noble Lord, Lord Shackleton, has made. As my predecessor in both of my jobs, but particularly as my predecessor in the Civil Service Department, he announced early last summer the outlines of a reform which, if returned to office some fifteen days later, his Party would have worked out. Our own changes in some principal respects parallel those reforms very closely indeed, and I am glad to acknowledge the mixed parentage—the hybrid political paternity—of this measure. It is no worse for it.

But, my Lords, the Bill also fulfils pledges that my own Party has been making for quite a long time; and I can tell the House frankly that when we were returned to power this was one of the first subjects on which I called for reports and I put in train a number of rather urgent studies. I think I can claim, I hope without being immodest (and I am claiming no more than mixed parentage for this Bill), that no time at all has been lost in launching this Bill down the Statute Book slipway. I have been very glad here to make much more than a formal obeisance to the noble Lord, Lord Shackleton, but he knows as well as I do how much we Ministerial birds of passage owe in this and in other matters to the devoted labours of some very able civil servants.

My Lords, I wish to make it clear that the Bill forms part of a wider strategy of re-examination and reform of all the issues affecting the way people should be treated when they leave the public service. On May 12 I announced to your Lordships' House new and, I think, much improved compensation terms for civil servants on the occasion of premature retirement; that is, for those who have to be retired before the normal retiring age, either on redundancy or on grounds which are new in the Home Civil Service but familiar in the Diplomatic Service; namely, structural grounds or limited efficiency. At the same time—and, although this is not directly relevant to the Bill, I think it is worth mentioning this in this context—we are busily engaged in a deep review of the Civil Service Pension Scheme as a whole. This review is being conducted jointly by management and staff, and similar reviews of the other public service pension schemes are also in train. I cannot say exactly what issues will and will not be covered, and with what result. What I do say is that nothing relevant is excluded from consideration. The sort of issues which are likely to be looked at are of a kind in which I know several noble Lords are interested, such as preservation and transferability, the right level for widows' pensions and so on. All this, of course, relates to the occupational pension schemes of public employees, and is again quite separate from the review of the social security system being conducted by my right honourable friend the Secretary of State for Social Services. We are not, of course, discussing directly any of these matters to-day: we are concerned simply and solely with pensions increases. But I thought it right—and I make no real apology for very briefly mentioning this—to put our particular Bill in this wider context, and to isolate this particular item of the Bill in a rather wider context.

My Lords, may I now return to the content of the Bill itself? It has received a fair meed of publicity, and I think its main lines are now reasonably familiar. I do not wish to repeat the White Paper, the first twelve paragraphs of which are easily comprehensible even to the most lordly intelligence—I may say that I had a typist's error there: for "lordly", read "lowly". But I will follow its pattern to the extent that the Bill is best described as setting out to do five important things. In the first place, the White Paper explains in detail what a confused and inequitable legacy, a real morass, has been left us as the cumulative effect of the 11 Pensions (Increase) Acts. This is, of course, looking at the efforts of our predecessors of all political complexions with the eyes of the present, which is a most unfair way of passing judgment. But there was no doubt in my mind that the first thing we had to do was to make good the deficiences of the past, both in order to get all pensions at least restored to their original purchasing power and also, and not less important, to iron out most of the anomalies.

Those anomalies are rather horrifying. I instance the Fire Service, though one could take many other examples. For example, a fireman outside London who retired in 1952 with a pension of £326 now has £614, some £50 ahead of his original purchasing power: whilst another who retired with the same record of service eight years later, in 1960, on a pension of £435 now receives £542, £60 below his original purchasing power. Again, a Civil Service clerical officer who retired in 1946 on a pension of £207 is to-day receiving £532, whereas another who retired with the same record of service 18 years later, in 1964, on a pension of £463 is to-day receiving £491. Our first main aim, therefore, was to correct these inherited and, to my mind, grossly unfair distortions. We decided to do so by setting a baseline for the main principle of the reform—the introduction of inflation-proofing—by first restoring all pensions to their original purchasing power as on that date. The chosen date is April 1, 1969, which is the operative date of the last Act and the beginning of the first review period under the new system. Somewhere between two-thirds and three-quarters of the pensioners will receive one of these once-for-all or levelling-up increases. Most of these increases will range between 1 and 17 per cent., but some are in fact a great deal higher. They are of course additional to the increases given as a result of 1969–71 variations, which are 18 per cent.

The second main feature of the Bill is to compensate for the rise in the cost of living since the baseline date, April 1, 1969. This is the first review, and this increase is added to the once-for-all increase which I have just mentioned, and the two will be paid together with effect from September 1 this year. This produces some very sizeable increases overall. For instance, if I may be permitted to quote this example in your Lordships' House, a Grade I Ambassador who retired on a maximum pension of £3,500 in 1962 (and I know that I can say this in the presence of the noble Lord, Lord Gore-Booth, as he retired a great deal later) will now be getting £4,004. This will be raised this autumn by 32.2 per cent., to £5,295. By the same token, a private soldier who retired on the 1945 code originally with a pension of £1.32 a week now receives £3.35. He will be due, following the principles of the Bill, for an increase of 35.5 per cent., to £4.56. I quote those just as fairly typical examples of the implications of this Bill which are not inconsiderable for those concerned.

There are one or two important details to fill in here while I am talking about the first review. The strict objective would be to compensate for the rise in the cost of living between April 1, 1969, and April 1, 1971, and this was our intention when we announced our plans in outline in the Statement I made in your Lordships' House in November last. We also explained then that we could not pay out at the higher rates before September. I had examined this very carefully because it at first surprised me that this five-months' gap was in fact necessary. But I came to the conclusion, having looked at it, that it was unavoidable for mechanistic reasons. Nevertheless, I was disturbed about this five-months' gap and my own misgivings were reinforced very powerfully by representations of a frank and forceful kind from the pensioners' organisations. This I believe was a weakness in our arrangements, but it has now been put right by the addition of a margin, which takes account of the five-months' gap, built into the increases to be awarded this year.

The next point I should like to touch on while dealing with the first review period is that all qualified pensioners who retired within it, that is to say, right up to March 31, 1971 are going to get an increase this autumn. This is quite new and by previous standards at least a fairly startling innovation. Under the Acts of the past, there was a distinctly harsh and inflexible cut-off system which prevented anyone who had retired immediately before the Act—latterly some 21 months before—from getting any increase at all. This, coupled with the interval between Acts, meant that some pensioners had to wait up to five years for their first increases. We have imported the flexible principle of a cost of living "trigger". At reviews there will be increases so long as costs have risen by 4 per cent., and anyone who retires within the review period will likewise get an increase provided there has been a rise in the cost of living of at least 4 per cent. between the period of his retirement and the end of the review period as a whole. At a period of less aggravated inflation no doubt this 4 per cent. trigger would exclude some pensioners who retire within the review period from any increase at their first review; but the machinery is there and I believe that this is an important advance.

My Lords, that brings me to the third main feature of the Bill. Having got this year's increase out of the way, its provisions require the Government to conduct further reviews every two years starting in 1973, with the same objective of maintaining purchasing power. Doubtless, this year's increases, which will be very substantial (as I hope I have substantiated), will be in the forefront of most pensioners' minds at the moment. But some of the most thoughtful letters which we have received in my Department (Lord Shackleton's old Department) have shown that these further assurances of when the next increase will be coming along and of how it will be assessed—assurances of a kind which have been so conspicuously lacking under the present dispensation, assurances which build a predictability into the system which it has hitherto totally lacked—are even more highly valued.

The fourth main feature of the Bill is the power it gives to reduce by Statutory Instrument the qualifying age at which increases may be earned. This has no effect on the retirement age in the various public services, as noble Lords will recognise. It is, however, a change which is of particular interest to those services on the civil side, notably the Police, the Fire and Prison Services, as well as, of course, the Armed Forces, in which retirement on pension at an earlier age than 60 is quite common. At the moment those who retire on pension at a younger age still have to wait more or less patiently until they are 60 before they can receive increases unless there are special circumstances, such as their being chronically sick or widowed or having some exceptional reason for qualifying on the ground that they cannot earn a proper living.

My Lords, the present Government were pledged in their Election Manifesto—and, I believe, rightly so—to this lowering of the pension threshold to 55. All I would say is that the principle is well and truly embedded in the Bill, in Clause 3(8). We have made it clear that this principle will be consummated within the lifetime of this Parliament. We Mould have liked to be able to give effect to it forthwith—or, should I say, "at a stroke"—in this Bill. But the deferment, though not for long, of this part of the reform was the reluctant result of a careful and deliberate assessment of priorities. We thought it more important to get inflation-proofing thoroughly established for those who are already over 60 or are otherwise qualified, at a cost of something like £80 million to public funds, before bringing in this further criterion of eligibility at a further cost of another £11 million or so.

Finally, on a rather more technical level, the Bill repeals the eleven Pension (Increase) Acts at present on the Statute Book and provides for their consolidation in a way which retains the rights and expectations of the many thousands of people who still have existing and contingent entitlements under them. I am sure that we have been right to consolidate in this way. The new system will also simplify administration, both because it is simpler and more predictable and also because, in future, all this will be properly codified. On all counts, my Lords, I should like—I say this with a real degree of sincerity—to pay tribute to the Parliamentary draftsman for his ingenuity in producing the Bill and planning the main Order which is to follow and which is to be made under it as described in paragraphs 45 to 47 of the White Paper.

Those then, my Lords, are the main features of this Bill. I believe that the expert commentator who wrote recently in the Financial Times was fully justified in describing it as a tremendous leap forward for public service pensioners. If one could qualify words like "fair", I would say that this measure could, if anything, be described as on the generous side of fair. I have spoken for some time, but this is a Bill which I, like the noble Lord, Lord Shackleton, before me, have been deeply concerned with, and perhaps therefore I may be excused for having taken up some of your Lordships' time.

May I, in conclusion, turn to one or two main lines of criticism about the Bill which I have heard voiced. First, I should like to express my sincere appreciation of the work of the Public Service Pensioners' Council and the help they have given us by the advice we received from them in our discussions with them during the preparation of the Bill. Equally, my Lords, in fairness I must add that my appreciation of a group of Amendments—which they appear to have canvassed in another place after the publication of the Bill—is less than total. Some noble Lords may have seen these Amendments. They would abandon inflation-proofing and substitute a hybrid of a cost of living and an average earnings index for assessing all the increases under the Bill. For good measure they throw in an annual rather than a two-yearly review, and they would substitute a 2 per cent. for the 4 per cent. minimum cost of living trigger.

At first hearing some of this may not sound wholly unreasonable, but I must make clear that I regard this package at this time as wholly unrealistic. We have costed the Council's proposals and they would raise the total cost of the Bill to public funds from something just under £80 million—£79 million—to £213 million per annum. They would cost about £100 million a year more than parity and would raise most, if not all, the individual pensioners far and away about the parity level. Frankly, my Lords, these proposals are just "not on". I have mentioned parity. I know that this principle of parity, the principle of updating old pensions by raising them to the level of new pensions currently being awarded for the same record of service, is still the long-term aim of some. In view of all that the Bill offers, I hope that it will not now be seriously proposed to us once more. Suffice it to say that the Government, together with I think the official Opposition, are opposed to parity mainly on grounds of cost, outside comparisons and intrinsic merit. I should be happy to expand on this later, if necessary.

Some more discerning critics have singled out and argued particular aspects of the Council's package on their merits, and particularly the proposed annual review. Conscious that both main political Parties had earlier come quite independently to the conclusions that two-yearly reviews are right, they have argued that the rate of inflation in recent months would be a justification for change now. I could not deny that there is some force in this suggestion, but the Government are (and I would be disingenuous if I did not make this clear) firmly against it on merit. In reaching this conclusion they have had regard principally to the quantity and quality of the whole package of the Bill, the practice of other good employers and our own firm view that those who ask for annual reviews are too much influenced by the experience of what I regard as an exceptional and rather untypical period, and are, in consequence, taking too pessimistic a view of the future course of inflation.

The last respect in which I would like briefly to anticipate the possible interests of some noble Lords concerns overseas pensioners. This Bill represents no change of policy on the part of Her Majesty's Government. The coverage is basically the same as under previous Acts. Clause 12 has been added in another place only to provide beyond doubt a contingent power, which we had earlier thought and said was already provided, but which further legal advice revealed to be in doubt. Under that clause it would be possible, if any Government were in future so to decide, to bring within the ambit of the Bill certain over-sea expatriate pensioners who were not Crown servants and who have sometimes been loosely described as "quasi-Government" pensioners. Again, I could say more about this at the end of the debate, if required.

I apologise for speaking at some little length, but the Bill we have before us is one which affects in an intimate and direct way the welfare, the prospects and, indeed, the happiness of many hundreds of thousands of our fellow citizens, who are now retired but who have deserved well of our society and our State. I hope that in view of what I have said about the value of this new deal as a whole—and I believe that it is a very fair deal—your Lordships will be able to give this Bill, with whatever qualifications your Lordships may wish to give it, in general a warm and unreserved welcome.

Moved, That the Bill be now read 2a.—(Earl Jellicoe).

3.22 p.m.


My Lords, it is my experience that when your Lordships' House meets on a Friday, we try if possible to finish by 4 o'clock. I think that this may be too optimistic, but I shall try to make my own contribution fit as near as possible to that target. My task is made all the easier because of the clarity of the noble Earl's exposition and because of my almost total agreement with what he had to say. He was good enough to pay some generous tributes, and at the risk of this appearing to be a mutual admiration society I would say that I am grateful for what he had to say. It is a surprising thing that in another place they appeared not to know the genesis of this Bill and to think that somehow it all came out of the Conservative Election Manifesto. As the noble Earl knows, the proposals in that manifesto were for establishing a sort of 1956 parity, which would have been nothing like as good as the proposals now put forward by the Government.

I am rather conscious of behaving like a retired headmaster who is continually giving advice to the present headmaster, but I am bound to say that it is a matter of great personal satisfaction to me—and it does no harm to say so in these contentious days—to recognise a community of view on certain things which the noble Earl singled out. He took the initiative on two matters which I feel are of primary importance. One is a realisation of the morass that existed in pension increases in the past—of which he gave examples—and the second is in establishing a better system of premature retirement. I know from my own experience that it is not always easy to persuade one's colleagues that what seems to one just and necessary should be done, and I congratulate the noble Earl on his success, and on the speed with which he acted. He might not have been so successful a little later and this, I think, shows good political judgment on his part.

I am sorry to go on with these bouquets, but he is right in paying tribute to his Department. It is not usual to refer to officials by name and I do not propose to do so, but the noble Earl will know that we hold in high regard a particular under-secretary and others who are associated with him. They have put us right. The inflation-proofing scheme which came out of the Civil Service Department is unquestionably the best and most practical scheme. The noble Earl was good enough to laugh at the point about doing something "at a stroke", as to which he will no doubt say that we have misinterpreted the Prime Minister. So, equally, in another matter, where the previous Prime Minister was misinterpreted, this Bill ensures that the pound in the pensioner's pocket is not devalued—though let me hasten to add that I have always thought that that particular phrase was grossly mishandled for political purposes.

This set of proposals will, I am sure, stand for a long time. We agreed that there should be these regular reviews; but I cannot help feeling that by establishing this system, in the present context, and in the new type level of pensions that exist outside, they are fair: but, I still say—I agree with the noble Earl—on the generous side. I am bound to say that I think the pursuit of parity would not really be practicable, nor would it be just to the rest of the community, for many of whom provision is still inadequate. This Bill, of course, covers vastly larger numbers than the Civil Service. It has surprised me how many people are still unaware of the benefits that it confers on them. The fact that doctors in the National Health Service, consultants (and perhaps the noble Earl will confirm this in his winding-up speech), teachers, firemen and others will benefit from these proposals is something which is of great value. This is particularly true of the Armed Forces (and we shall leave this to the noble Lord, Lord Bourne, who has been so active on their behalf to comment on) who will benefit by a different Instrument.

The noble Earl gave us a number of quite extraordinary anomalies that existed under the previous system. I am not quite sure that they are anomalies which should have been given as examples to me: they seem to be even worse than some of those that I have heard about. Not the least of the virtues of this Bill is that it produces a great measure of equity generally by removing so many anomalies. There is one point that we shall want to consider and may wish to discuss in Committee. I agree that some of the suggestions that have been made for Amendments to this Bill are suggestions which I should find it difficult to support, and which I do not believe are actively pursued by the principal trade union leaders concerned. One of the great advantages in dealing with the Civil Service is the sense of responsibility of the unions—in this context I could make a comment about the Industrial Relations Bill; but I will not do so.

I think we should consider further the question (the noble Earl may wish to comment on this) as to whether two years is now the right period. I agree that it was the view of both Parties on the passing of the last Bill that two years was the right period, and, if my memory is correct, if there was a 4 per cent. increase in the cost of living during that period then the Government were to announce what action they were going to take. This is now all regularised. But there is little doubt that a strong argument could be made that, if two years was the correct period in order to ensure reasonable justice then, under present conditions, the interval ought to be one year. There are arguments against this, and in fact a review is in progress into linking pensions with a proper national pensions system.

One of the tragedies (though I do not wish to pursue this point) in the situation is that Mr. Crossman's National Insurance proposals, which very much complemented this Bill, and indeed provided a greater justification for the dynamising in effect of public service pensions, are not to be applied. We therefore, for the moment, have to look at this Bill on its own. There may well be practical arguments against it, but in terms of justice, if the cost of living goes up by as much as 8 per cent. in one year, instead of 4 per cent. over two years, as it might have done, there would seem to be a strong case for a review. The difficulty is that one would never cease reviewing; and that I acknowledge. The noble Earl has managed to overcome other difficulties, and I should like to ask him to consider this matter further, because we may return to it at the Committee stage. In this connection, I must say that the change with regard to the effect of benefit from these schemes on those who have to retire earlier than 55 is an addition made by the Government: themselves, and they are entitled to the credit for it. But I think the noble Earl will still agree that it is less important than the broad sweep of this Bill which he has now introduced.

I mentioned just now its relationship to a proper national pensions system. The absence of this makes more difficult, I believe, a satisfactory system of pensions for ill-health retirement, which is one of the subjects we were discussing. The absence of it also makes more difficult projects and intentions regarding transferability, which I know the noble Earl himself favours both transferability and preservation. However the Government will go ahead on their own, because I know that talks will be taking place parallel to those we were having with the Joint Superannuation Committee a year ago.

I hope very much that two other aspects will be covered. One is better widows' pensions. There is no doubt that a one-third pension is not fair to a widow; and we all know of women connected with the Civil Service or with the Armed Forces whose husbands have died in some way not attributable to the Service, and who are living only with great difficulty. I hope that soon we shall move to a 50 per cent. widow's pension.

I should also like to mention pensions for temporary staff. I have always disliked the idea that in an occupational pension scheme some of the temporary staff—and obviously there must be sensible administrative limits—should not be able to benefit from an occupational pension scheme. One must bear in mind that there are many so called "temporaries" (they are "temporaries" because they are not established, even though they may have been for 20 years or so in the Service) who never become established; if they did, their service would count. I think it is important that provision should be made for them, again as an example to the rest of the country.

I should have liked to discuss some of the inadequacies of occupational schemes outside the Service, but it would not help to do so. However, I am grateful to see this Bill coming into law. It will certainly set an example which I hope will be followed more widely. There are still difficulties; and I note what the noble Earl had to say about overseas pensioners and the provision now being made in the Bill, because of the mistaken impression, as I understand it, of the Government that this provision could have been made under the Bill as originally drafted. There was an unfortunate slip here. However, when I was in this position I had to resist this particular claim. None the less, it may well be that something can one day be done. At present, there is a feeling of injustice. But it would certainly not be appropriate for me, in the position I have taken up, to seek to press the noble Earl further. So I end by congratulating the noble Earl, and by saying that I hope some of the points which I have made, and which other noble Lords will be making, will be considered, and that in due course we may wish to raise some points on Committee.

3.35 p.m.


My Lords, my noble friend Lord Beaumont of Whitley, who has had to leave to catch a train to Liverpool for a long standing engagement, after having taken part in the Civil Aviation Bill, has asked me to say one or two words about what he felt-upon this Bill. First of all, he wanted me to say how grateful we were for the provisions of the Bill and, in general, how pleased we are about it.

There were three points in which he was particularly interested, all of which the noble Earl has touched upon. The first of them concerned the machinery. I know that my noble friend will be disappointed with what the noble Earl had to say about a suggestion for the rectification of rates of pension by way of taking an average of the index of cost of living and the index of wages instead of in terms of cost of living index only. I know that there have been many suggestions, of which this is one, to try to devise some anti-inflationary device which could be built into pensions so that they rise automatically with the rise in the cost of living, without themselves being inflationary. This was one of those devices. I know how disappointed my noble friend will be to hear that such a scheme would cost in the order of something like another £100 million a year. This is very disappointing. I am sure that the noble Earl is right in his figures; nevertheless, I am sorry to hear that.


May I interrupt the noble Lord? I have less confidence about being right in my own figures if they are really my own figures; I have complete confidence in those who have given me those figures.


My Lords, my noble friend was also interested in the question of the two years as opposed to one year. I notice that the noble Lord, Lord Shackleton, also felt that there was something to be said for having a review annually instead of biennially.

The third point, upon which the noble Earl also touched, was the question of quasi-Government employees in former Colonial territories. I know that it has always been the Government's view that a line must he drawn somewhere, and they wish to draw the line between those who worked for the central Government and those who worked for, say, a local authority or university. Nevertheless, I cannot help feeling that the amount of money involved would not be very great, and that it would be of immense value to servants of those institutions if it were possible to protect their pensions as well. I should have thought, from the way the Bill is drafted, that there is no reason why the Government, without introducing new legislation, should not be able, under the powers that they already have, to make rules defining the eligibility of pensioners to receive the supplement. This means that under certain conditions the Minister can authorise supplements without further legislation. This seems to me to be something on which the Government could think again. I hope that I may have the support of noble Lords like the noble Lord, Lord Gridley, and the noble Lord, Lord Gore-Booth, who have great experience in this matter.

Those were the points on which we felt that there was room for improvement in the Bill. Apart from that, we welcome it very strongly. A lot more, I feel, could be said upon this Bill, but there are six more speakers and, if we are going to follow our tradition of trying to finish our proceedings before four o'clock, that means we can have four minutes each, and I think that I have had my four minutes.

3.39 p.m.


My Lords, I will try, like my predecessors, to keep my remarks short. I should like to thank the noble Earl, the Leader of the House for his excessively kind remarks about the Officers' Pensions Society and my part in the negotiations. In return I would say that I very much enjoyed discussing with political leaders on both sides this very important subject and that F received really hearty co-operation. In particular, I remember Mr. Reynolds, who was the Under-Secretary of State for Administration and who died in a military hospital not far from here. He had this subject really at heart and helped us tremendously. My general feeling about the Bill is one of thanks on behalf of the Armed Forces, if I may for the moment speak for them. It is a tremendous advance and represents a new concept in the system of pensions which allows for inflation at whatever speed that may go. It is a great advance, to my mind, on the previous system, which was relief of hardship at three-year intervals and entailed much lobbying and a lot of hot debate, and was not always, in spite of the generosity, very satisfactory because of the mass of anomalies which the noble Earl the Leader of the House mentioned. The automatic nature of the biennial reviews is also a system of keeping up with the inflation and keeping pensions up to the purchasing power for which they were originally issued. It is something for which we have been pressing for a good many years.

There is only one criticism on this aspect of the Bill. Although it provides a measure of inflation-proofing, it does not provide for any increase in the sharing of the rising standard of living which the Leader of the Labour Party actually referred to as a "share in rising prosperity". He mentioned that six years ago, and I am sorry to say we are still waiting for it. When we join the Common Market we shall find, if we are not careful, that pensioners in the other countries are sharing in their rising national prosperities while we British, although this measure represents a very great advance in the public service pensions system, will not be sharing in that rising standard of living. It may be quite important as the years go by. I have a suspicion that there are two standards of living. One is for the workers. In the case of the Armed Forces, the generals, the private soldiers and the admirals who are actually defending us receive rates of pay, and consequent pensions, which are the rate for the job; and a very good thing too. But the retired officers and retired civil servants, ratings and other ranks, do not receive any share in the rising standard of living—at least not under this Bill. They have contributed to that share in the rising standard of living but they receive nothing in return.

My next comment is about the choice of the April, 1969, base line, which is fair and incidentally has entailed much work. We appreciate that and the very good reasons why the new pensions cannot be paid until September 1, 1971. But the moment one brings in a system which contains original gaps, those gaps will percentage-wise not change, but from the point of view of money they will change very much. May I give two examples. Majors retiring on the 1964 and 1966 codes have a gap at September 1, 1971, of £159. On a 5 per cent. annual rise in cost of living, that gap will rise, from the money point of view, to £254. If cost of living should rise by 10 per cent., it will rise to £394, which is a very big amount. The other example is that of brigadiers, who under the 1964 and 1966 codes would have a gap at September 1, 1971, of £390. On a 5 per cent. basis that would widen to £629 and on a 10 per cent. rise in cost of living basis the gap would widen to £971, very nearly £1,000. That is the difference for those two types of elderly retired officers.

There is only one way out of this system by which anomalies increase. It is, of course, to increase parity. We know very well that the cost of parity has hitherto precluded both kinds of Government from accepting it, but this Bill will cost £79 million a year. I wonder how much extra it would cost to bring in parity. That would get rid of the gaps I have mentioned. In any other system without parity, inevitably these gaps will be involved and they will inevitably widen from the money point of view. It has always seemed very curious to me that we accept a system of parity under National Insurance and everyone gets the latest increase. The same applies, by the way, to disability pensioners who also receive the latest increase, whatever their age or disability. It has never been explained to me why one section of the community, the elderly and the disabled, should receive treatment by parity and yet the million or so public servants and Armed Forces pensioners should not receive parity and that in fact it should be refused. I am not pressing for it in this particular Bill, but I should be interested in the answer to that question.

My last point on the Bill itself concerns the business of reducing the age of eligibility for increases to 55. The sooner that is done the better. "During the life of this Parliament" is a fairly vague phrase. Two things must not be forgotten. One is that now changing one's career is much more difficult than it was immediately after the war. It is especially difficult for retired officers who are not qualified in many ways like other ranks and ratings. Sometimes they have to retire as early as the age 45, which means 15 years of erosion before they get the increase. For warrant officers and N.C.O.s retirement is even earlier, but they do not have so much difficulty in getting a second career. In other words, what I am pressing for is that as erosion starts hitting the retired officer or the retired public service pensioner straight away if he retires at 45 or 50, which is very early indeed by Civil Service standards, he ought to get the increases straight away. In other words, the age limit should be withdrawn altogether.

My Lords, I have no Amendments to offer to this Bill, but there are two connected matters about widows which have already been mentioned by the Leader of the House and by the Leader of the Opposition and to which I wish to refer. One is widows' half-rate pensions. Big companies such as Shell and Unilever pay these already. Our friends in another place also get half pensions, although admittedly they contribute to them. An officer cannot return his contribution because of being in a jungle or a swamp, but the fact remains that he has earned his pension; therefore his widow should get it. Lastly, there are widows who married after retirement of the husband. This point has been pressed again and again. The husband earned the pension and, in my opinion, it is iniquitous that the widow should not get anything at all. It is high time that this small matter was put right. It will not cost very much; indeed, with proper safeguards it could be done quite cheaply. Therefore my general remarks about the Bill are to thank the Government very much on behalf of the Armed Forces and the public service pensioners for a Bill which ought to take the heat out of the annual debates in Parliament and at last give justice to the retired officers and public service pensioners.

3.50 p.m.


My Lords, I will try to conform to the general desire to be as brief as possible and will talk in shorthand—if that is possible. I wish to speak about the Royal Warrants and war pensions, which are akin to this matter and allied to the matter about which the noble and gallant Lord, Lord Bourne, has just spoken. He asked how it came about that a soldier, sailor or airman who comes out of the Services gets a very modest pension, be he officer or man, whereas the disabled and the elderly have very much better pensions.

The answer surely is age. The disabled man, generally speaking, cannot earn a living very easily, nor can the very old man; and that seems to me to be the simplest answer to this question. I am not unsympathetic to the soldier, sailor and airman. Indeed, it is well that they, among all our citizens, should be the best friends of the disabled ex-Servicemen —and they have been. I have cooperated with General Jeffreys and I would co-operate with the noble and gallant Lord, if I were asked, and would help him in his campaign in the way I was helped when I was campaigning for the disabled.

For over 50 years, all Parties in the State, all Parliaments and the people generally, have accepted the fact that an increasing burden or responsibility rests upon all the people to see that disabled ex-Servicemen are generously treated; and efforts have been made over these 50 years by all Parties, leading to a situation which is at any rate not ungenerous. This involves a certain priority, the kind of priority which the noble and gallant Lord, Lord Bourne, was talking about. There is the priority given to the old, to the disabled and to the blind. I hope and feel that such priority must be continued. Whatever else is done, I hope the pattern that has been set these 50 years will continue; that the disabled ex-Servicemen—and particularly those disabled in the highest degree—will take a special place in the hearts of the people and that assistance to them out of the pockets of the people will be continued.

I am glad to think that the pattern set by the nation, the pattern evolved by St. Dunstan's and the pattern of other similar organisations, under which very special attention and a great deal of money has been spent upon disabled ex-Servicemen has found fruit in the civilian field. Those now disabled in industry, those going blind or disabled for other reasons outside a war—perhaps even outside industry—by natural causes, are very much better treated than they were. Civil Service pensioner nurses are treated very much better than they were, all because of the example that was first set for the ex-Servicemen and particularly the disabled ex-Servicemen.

It may well be said that disabled ex-Servicemen have done something for others in similar plight by blazing a trail. But I hope priority for them will go on, because it must be a long time before this nation can afford to upgrade all to the standard of the highest. Let us not then in any way depart from the feeling that has moved all Parliaments, been spoken of by all Leaders and by all Ministers for 50 years, under which these categories do receive a special favour from the nation—if you like, a special preference, a special priority: for example, in the matter of jobs, in the matter of housing, in the matter of allowances for rates in local authority housing. In all these fields there has been a special privilege given to the disabled man, and. I hope it will widely continue.

I do not speak for the Royal British Legion, though I did at one time; but I know, having talked to them, that they would wish me to associate them in thanking all Governments over these 50 years, but in thanking this Government now for the arrangements made for the war pensioner. They are in general not ungenerous; but I will deal in brief sentences with the field I know best, of the war blinded. These men, according to their various degrees of blindness and other disabilities, such as additional loss of limb and so on, and the allowances they get, have been granted in the award I am now talking about, which parallels with this Bill, a rise of from 19 to 28 per cent. That is related to a rise of 11 per cent. in the cost of living since the last award was made. So it will be seen as not ungenerous—I will go further, indeed generous. But of course—and here we come to the crux of the matter—the award was made and the rates were set six months ago, and they will not be the same in September. The gap, the advantage, will not be the same in September, and will certainly not be the same in two years. I associate myself with the view expressed by the Opposition and by others. The Government will, it seems to me, have to consider something a little more immediate than a two year review, if such inflation as we now have persists.

Here I want to mention one figure only, which may impress your Lordships or anyone who reads what we say. In the three months period from January 20 to April 20 this year the cost of living went up 5 points. Let us "put that in our pipes and smoke it," because it is a valid criticism of the two years period. The noble Earl told us about the gap—it made me think of a credibility gap, but that is something else, of course—the five months gap which he benevolently said he is going to fill in, if I understood him. Is he going to fill it in for the disabled war pensioners? I hope he will answer that question when he comes to reply. If I understood him aright about filling in this gap, what was said five months ago will be altered in September above what was set; at least I suppose that is what he meant.

May I conclude by giving a very few figures which I feel ought to go on the Record. The £1 of the year 1938 (the 100p as we now call it) was 10 years later worth 51p, practically half. It is now worth 22p—ponder this: under a quarter—in half of my lifetime. If this progression is taken on to the end of the century it will be worth an old shilling or what is now called 5p. As everybody knows, inflation is the greatest of the problems that faces us. Above all, it faces all the categories for whom we are talking and thinking to-day—the old and the disabled. I want to take the opportunity of saying "Thank you" to ail those who work, to all those who save and all those who make a living for Britain, because it is to them that the old and the disabled must look. Unless they work well and successfully and make money, and unless the economy thrives, there cannot be benefits for those who fire to some extent dependent. I feel we should say "Thank you".

One last word in support of the noble and gallant Lord, Lord Bourne, in what he said about the standard of living. This is something quite different from the cost of living. All through my lifetime, and the lifetime of anyone in our vintage, there has been an increase in the standard of living; and what used to be taken as luxuries now become, if not necessities, at any rate enjoyments of life, and it is our hope that the old and the disabled, and especially those for whom I speak, may continue to enjoy, each time there is a review, a little of the increase in the standard of living which is the common lot of the British.

4.2 p.m.


My Lords, I rise not because I have anything highly new and original to say nor because I am an expert on the subject like the noble and gallant Lord, Lord Bourne; I am merly the recipient of a small sum which seems to vary very mysteriously from month to month and I have the mixture of laziness and virtue which has dissuaded me from asking what this Bill is going to do to me. I am grateful for the noble Earl's suggestion that it may be beneficial. None the less, I felt that somebody who is a retired civil servant should say a word in this debate both of comment and, if I may anticipate later remarks, appreciation.

This is obviously a reform of the very greatest importance, since it removes one item in the whole matter of calculating pensions which I think, quite apart from its mathematical implications, has been a difficulty. I think it is always possible psychologically to demand more than you deserve for what you are actually doing; on the other hand, to ask for not quite enough for what you have stopped doing is, even for people of great articulateness, a little difficult. There has always been this emotional and psychological difficulty about pension increases and, quite apart from mathematical benefits and the money benefits which this Bill will confer, there is this psychological difficulty removed, I hope once and for all, from this arena.

Now as to whether there are criticisms. An ex-civil servant will always look first for weasel words in a Bill like this, and I am happy to say that one finds very few. I do not like the phrase, "as soon as may be" but perhaps it is a term of art. I also notice in Clause 2(5) the phrase: On any review…the cost of living shall be assessed by such means as the Minister thinks appropriate. Any Minister within sight, past or present, does not worry me at all, but I would appreciate a comment by the noble Earl on whether he feels that that definition of how the cost of living should be assessed for the purposes of this Bill is fully safeguarded in the interests of future pensioners. I am sure that the answer is in the affirmative, but I should like to feel that there is some really thought-out justification for feeling that the position is truly safe under that definition.

I should like to associate myself with the noble Lord, Lord Shackleton, and others in the matter of widows. Somehow or other the pensions for widows tend to get left at the bottom of the argument. When I joined the Diplomatic Service no arrangements were made at all, and we have always taken a little time to catch up. I still wonder whether the present arrangements are in fact adequate, and perhaps the noble Earl would say a word on that side of the matter.

On the question of early retirement, I have some sympathy with what the noble Lord, Lord Bourne, has said; with, however, the qualification that, certainly from the point of view of the Diplomatic Service, this all ties up with the reason for which retirement has taken place. It is conceivable that this will be dealt with more satisfactorily under the parallel argument on the terms of premature retirement, but it is a point which should not fall between the two separate pieces of legislation. A point was raised by the noble Lord, Lord Henley, and I apologise to him because I was not quick enough in following his argument. If there is anything which I can contribute to the point that he made, I shall be very happy to discuss it with him later.


My Lords, I must apologise. I think I mentioned the noble Lord, Lord Gore-Booth, but it was perfectly clear to me that what I meant to say concerned the noble Lord, Lord Gridley, and the noble Lord, Lord Milverton, and was not really in the field of the noble Lord, Lord Gore-Booth.


My Lords, I am deeply relieved. On the matter of the annual review, I find myself very much, as a former civil servant, in sympathy with the noble Earl. I think an annual review would, if I may speak colloquially, mean administrative fidgets all the time, and I think in a matter of this kind it is a good thing to have the Administration doing its work for one year, and then perhaps sitting back and looking at its effects, repercussions and details for the next year. One must then wag a symbolic finger in the vaguely political direction, and say that if inflation goes on at the rate at which it has proceeded in recent years, the demand for an annual review will undoubtedly become irresistible.

Those are some of the points which have been made, and which seem to me to be the most important ones for further consideration. It only remains for me to express the appreciation, which I forecast, first to the Government and to the noble Earl, not only for having produced this legislation but for having found time to accelerate its consideration in another place and in your Lordships' House. I do not think that the noble Lord, Lord Shackleton, need worry too much about lack of appreciation. I can assure him that, certainly in circles which knew more intimately what he was doing, we appreciated very much indeed the understanding and humane manner in which he took up this matter when it was brought to his attention, and we know about his great contribution to what has finally appeared.

If I may just add one thing, it is that the possibility of producing this very important legislation has come about, in a sense, because there is now a Ministry of the Civil Service. Previously the difficulty over matters like this has always been that there have been petitioners on one side, the civil servants or whoever it may have been, and there has been the rock of resistance (not an irresponsible one), the Treasury, on the other. It has been possible to sort this out only because the Department of the Civil Service has been the man in the middle with a financial conscience and yet, in a different way, also on the side of the Civil Service.

If I may add to those compliments, perhaps I may put in one little plug for my own Department. It has been something of a privilege to be on the edge of these matters in the sense that the Diplomatic Service, through being a smaller Service, has been hammering away at the frontiers of what happens to people when they retire. We achieved a certain amount in the Acts which now exist but perhaps not enough, and I think we have been able to make to the work of the Civil Service Department a certain contribution which has helped towards this felicitous result. With those comments, it only remains for me to join other noble Lords in thanking the Government for what they have done in this matter and to wish this Bill a rapid and harmonious progress into legislation.

4.11 p.m.


My Lords, I do not intend to detain your Lordships for very long. I realise that this is a Friday evening and that most of us want to get away at the end of what has been a rather strenuous week. But it is with great pleasure that I rise to speak on this Second Reading, because in our discussions on previous Pensions (Increase) Acts we have cut right across Party lines. We have been constructive, and there has been a general desire in all parts of the House to make a constructive contribution. I should like to pay my tribute to the noble Lord the Leader of the Opposition, because he and I discussed a subject, which we dealt with in Committee on the previous Pensions (Increase) Act, which has to do with certain categories of officers who at that stage were omitted. I shall deal with that briefly at the concluding stage of my speech.

I give a general welcome to this Bill, for three reasons. First—and one must declare one's interest in this matter—I am a retired Colonial civil servant and this Bill benefits me. But, in addition to that, I feel that to some extent it rectifies the difficulties which Colonial overseas pensioners have faced in recent years since they retired to this country. Secondly, and perhaps more important, at long last this Bill goes a long way to mete out justice to pensioners of the Overseas Civil Service. I say that with some diffidence, because I have had the honour to be a member of that Service. This Bill recognises that there were inequalities under previous Pensions (Increase) Acts, and that pensions would need a once and for all increase to bring them up to an equitable base line from which it would be possible to make biennial reviews. Previous noble Lords have commented on the biennial reviews, and the noble Lord the Leader of the Opposition, thought, with some justice, that with the increase in the cost of living it might have been more equitable instead to have annual reviews. The noble Lord, Lord Henley, made a similar point. I should like to give this matter some consideration before the Committee stage but, in view of the rapid increase in the cost of living, there is some substance in what the noble Lord, Lord Shackleton, said.

The noble Lord. Lord Gore-Booth, raised the question of administrative difficulties. I am not in a position to make any comment on that, but I am here to represent the interests of overseas Service pensioners. But in paying a tribute to what lies behind this Bill, I think I should say to your Lordships that I am aware of the many considerations that have gone into its framing. Nobody has been more aware than I, in my capacity as a member of the Council of the Overseas Service Pensioners' Association, of the courtesy extended to our Association by Governments when our delegations had points to make when we thought this Bill and previous Bills could be improved upon, or when we thought there was the possibility of removing some particular case of injustice. It is particularly moving to me personally to record this, because when you come home after years of service overseas you find that which, during that time, you had always believed in; that is, that you always get justice from some British Government, no matter what the political colour of that Government might be. I think it is only fitting, in connection with this Bill, that I should say that this evening.

My Lords, it has of course always been utterly impossible to strike, and nobody would ever think of it. If ever we wanted to improve our conditions of service, there was never any thought of a strike. We never could strike and we never would strike. No civil servant would ever contemplate such an action. Therefore, the only way we could get injustices remedied or improvements made to the conditions of service in which we were employed was to make constructive suggestions, to get one's point of view considered dispassionately and a reasonable compromise or agreement reached. I should like to express my appreciation, in all of this, to the present Minister of Overseas Development and Administration, and to his Ministers and officers. But as I said when I started my speech, it would be quite invidious of me to mention only members of the Government in this connection, and I should like to pay my tribute, as I did at the outset, to the noble Lord, Lord Shackleton, as Minister for the Civil Service in the previous Government. I think that probably this Bill, as it sees the light of day to-day, is the result of the devoted labours given by two Administrations, both Labour and Conservative, and therefore I should like to record my great appreciation for the Bill.

My Lords, having said all that, there are still certain anomalies in the Bill and certain injustices which I think I must mention now, although I do not want to stress them on Second Reading. I think that perhaps it would be more appropriate if I dealt with the subjects when we get to the Committee stage. But there are still certain categories of officers—namely, those overseas officers of the former Achimota College in Ghana, and members of the Nigerian Coal Corporation and of the Lagos Town Council—who for years have not been able to get any supplement to their pensions. I will not go into any specific detail to-day beyond stating that it is my belief that there is an injustice here. These men were in all circumstances overseas officers, recruited as such by the Secretary of State for the Colonies, subject to all the Colonial regulations and so on which apply to all officers similarly recruited; but they have so far been unable to qualify under the various Acts as certifiable overseas officers.

I do not want my noble friend the Lord Privy Seal to feel that he must give me a categorical answer this evening as to what may happen to these officers. I have a feeling that possibly they will be covered under Clause 11 or 12 which give power to the Government to include them and to see that they qualify for pension. Apart from that, I know that at the present time meetings are taking place between the Ministry of Overseas Development and our association to try to iron out some of these difficulties. It may be that the Government will be able to give us some answer at the present time. I do not believe that the cost of meeting the just claims of those officers who still survive can be very high. I would ask the Government to consider the suffering of the widows and to give sympathetic consideration to the very serious plight of these people. I thank the noble Lord, Lord Henley, and also Lord Shackleton who, although he did not touch on this subject, stressed the difficulties which I mentioned in a previous debate. I give my support to the Second Reading of this Bill.

4.22 p.m.


My Lords, I had not intended to make a speech of any length in this debate, but in view of the appeal from the Front Bench to limit what one says I do not propose to make a speech in the ordinary sense at all. I should like merely to say that I, among many others, deeply appreciate the skill and the work which has gone into this Bill, which all of those of us who come from overseas—and many others too—welcome heartily. I had intended to deal with one or two points but I will yield to the request from the Front Benches not to take any part in this debate. The only thing I should like to add to the remarks of the last speaker is this. If it is true that Clause 12 gives the Government power to translate sympathy into action, then I would point out that the need for action in these cases of what are called quasi-Government officers is very urgent indeed. There are also widows suffering very considerably. These officers went out under the auspices of the Crown Agents or such organisations, and when Independence came to those territories these men were given the assurance of the British Government, through their new masters, that they would in no wise lose, either in pension or other respects, from the transfer if they wished to serve under the new authority. That assurance had the moral support and the promise of material support in the event of those authorities failing to honour this obligation.

I had intended to go into greater detail. I could have given some details which are vital to a proper consideration of this question. I know that the Government have had appeals over the last three years from the Overseas Association. I know they are in possession of the necessary facts which I could have put succinctly to your Lordships; but I will spare you that. I implore the Government to take immediate action under Clause 12, as I gather from the noble Earl the Leader of the House that that clause empowers them to take the necessary action without any legislation being necessary.

4.25 p.m.


My Lords, I should like to say how much I apreciate the general welcome which this Bill has received. Quite a number of questions have been put to me but, because of the plea regarding time and that we should "draw stumps" reasonably soon, I will be as brief as possible in my reply. If, peradventure, I fail to answer a question, I will try to ensure that I communicate with the noble Lord concerned. Because of the general welcome received by the Bill I think I should concentrate on the points of moderate criticism or advice which have been made or proffered.

I turn to the possibility, mooted by a number of noble Lords, that perhaps we have been wrong in holding to the two-year review cycle. I listened carefully and was not surprised to hear suggestions made for an annual review period. The Government understand the anxiety of pensioners living in a period of far too rapid inflation. We are not without sympathy for the suggestion that reviews should be made at shorter intervals. Once again. I would stress the importance of looking at this Bill as a package and at the very great benefits that it will bring. I think that these have been fully recognised by noble Lords. Under the Bill, the situation for pensioners will be transformed almost beyond recognition. As an example, I would refer to a letter received from Mr. Feather, General Secretary of the T.U.C. (this was as a result of a deputation which came to see me), in which he described the Bill as containing virtually all the features for which the unions in local government have been pressing for a number of years. My Lords, the Government cannot prove objectively, and I would not seek to do so, that two years must be right and a yearly review would be wrong. But we have considered this point with very great care because it was obvious that we should be pressed on it. If we were to add annual reviews to this already attractive and not ungenerous package, we should certainly involve ourselves in further expenditure, as was recognised by the noble Lord, Lord Gore-Booth. We should also involve ourselves in a considerable and added administrative burden. More generally, we should be doing more than we could easily justify to the taxpayer who foots the Bill, and who, incidentally, in most cases cannot expect anything like comparable treatment. By doing what we are now proposing to do in this Bill we are, I think, placing ourselves near the top of the list of what good employers give to former employees. I think it is right that we should so place ourselves. I should have some doubts about the desirability of our placing ourselves too far ahead of the best of the field. But if need be, we can come back to this matter at a later stage. I feel that there is a great deal to be said for the two-year review provision.

While I am on this point, I think I can give the noble Lord, Lord Gore-Booth, the assurance for which he asked, about how the assessment of the rise in the cost of living between reviews will be made. I am happy to repeat what my honourable friend said in another place and assure the noble Lord that for the foreseeable future our intention is to use the normal Department of Employment index of retail prices. It may be that at some future date an index will become available that reflects more nearly the circumstances of public service pensioners. That is the only reason why the matter is left open. I think it would be a mistake to tie ourselves too rigidly to any tine index for all time, because we know that indexes are not always perfect. But there was no insidious, Machiavellian motive behind the words which the noble Lord quoted.

I am grateful to the noble and gallant Lord, Lord Bourne, for his generous welcome to the main provisions of the Bill and for what he said about reducing the qualifying age now or in the very near future. I think, at root, there is little between us. We fully accept in principle that the qualifying age should be reduced to 55. We are clearly committed to this and recognise this commitment. We also fully accept that it is less easy to obtain employment in one's later 'fifties than it is at an earlier age. I myself found that problem before I was in my later 'fifties, may I say. All I would add is that the timing we propose simply reflects our best estimate of the interests of public service pensioners as a whole and of priorities and costs. I need not repeat what I said in introducing the Bill, when I think I anticipated some of the suggestions which the noble and gallant Lord made. When one is making a very considerable advance, as we are in this Bill, it is not always possible, much as we should like it, to advance across the whole front at the same time. But it is certainly our firm intention to push this particular sector forward, certainly within the lifetime of this Parliament.

The other point the noble and gallant Lord made was in pressing, as I have known him to press before, that we should go beyond inflation-proofing and move towards parity. I think that we could spend more than a minute or two in philosophical discussion of this point, but I am not certain that it would be particularly appropriate at this moment. I suspect that for the time being, at least, this is an area in which the noble and gallant Lord and I will have to agree to differ. But there is a point within the point here. The noble Lord referred to the need (I hope that I am not travestying his words) to give public service pensioners some share in the nation's growing prosperity, and my noble friend Lord Fraser of Lonsdale had the same point in mind in some of his remarks. We recognise this and, indeed, already do this, in two ways. In the first place, as my noble friend Lord Fraser of Lonsdale said, it is our degree of prosperity that enables the Government to afford to be a good employer and produce this Bill. If only, God willing, we continue in the right direction and become more prosperous, we shall be able to move further in these directions.

Secondly, the Government believe, like their predecessors, that what we can afford over and above inflation-proofing should be distributed to all older people through the medium of social security benefits, and that is why, consistently with this, the value of National Insurance retirement pensions has increased, not merely in step with inflation but, in real terms, by something like 70 per cent. in the last 20 years; that is, between 1950 and 1970. The great majority of public service pensioners benefit from National Insurance retirement pensions. I make these points not by way of an argumentative reply, because I have little doubt that, whatever I say at this early hour—the noble Lord is thinking about his train to the West—we shall remain divided in theory on this particular point, and I expect that he and his colleagues will return to this charge.

Let me deal, before I sit down, with some more specifics. A number of noble Lords—the noble Lords, Lord Bourne, Lord Shackleton, Lord Henley, on behalf of his noble friend Lord Beaumont, and Lord Gore-Booth—raised the question of the inadequacy of the present widow's pension. I can say that I have taken due note of what was said. This is, as I mentioned in my remarks at the outset, a matter that is under review. I do not think I would dissent from the view that to pitch it at one-third is at the present time pitching things too low. I am aware that in some sectors of private industry it is pitched higher. But it would be fooolish of me to predict the outcome of the review which is at present in train, and improper for me to try to do so. All I would say is that I should have thought it inconceivable that the level at which a widow's pension is fixed should not be one of the matters that will come up for critical scrutiny in that review. I suspect that noble Lords, reading between the lines, can understand the meaning of my words here. The pensions of widows of marriages entered into after retirement, another point to which the noble and gallant Lord referred, are a somewhat different matter. He is aware that Ministers have recently received a deputation on the matter, and it is under study. All I think I can properly say here is that our answer will be given and made known as soon as possible.

On the question of pensions for temporary staff, raised by the noble Lord, Lord Shackleton, I think I can give him—perhaps the noble Baroness will pass on these words—the sort of assurance that he would like to have. This is another matter that is at present being considered in the context of the more general review of Civil Service pensions which is in train at the present time. Due to that, I think it would be wrong of me to make any firm commitment at this stage, but I is certainly one of the areas in which I hope it will be possible for us to make some progress in the course of that review. I can also confirm to the noble Lord, Lord Shackleton, what I think he already knows; namely, that there are few doctors and dentists who will not benefit from the provisions of this Bill.

Finally, on the other specific point (and I hope I have not missed too many of the specifics), there is the position of the quasi-Government pensioners. As I made clear when I introduced this Bill, the Government had no change of policy in mind when they introduced in another place the new clause, which is now Clause 12. I think there are few noble Lords interested in this not unimportant matter who do not know that since 1962 successive Governments have taken the view that only those who have worked for the Crown in the service of the central Government of the country concerned, and for whom the Secretary of State for the Colonies is strictly responsible, should be entitled to protection. That is the line which I think successive Governments have consistently maintained.

Nevertheless, I think we have all felt anxiety about this—an anxiety that was clearly expressed in your Lordships' House this afternoon. That was why, when the present Government came to power, my right honourable friend the Minister for Overseas Development set in train a review, as a result of which we came reluctantly to the conclusion reached by previous Governments, that the only defensible line we could draw was the line of Crown service. However, there are two matters in train at the present time. First, when my right honourable friend Mr. Richard Wood explained this to the Overseas Service Pensioners' Association he agreed to arrange meetings between officials of his Department and the Association within a Working Party to examine whether each category of quasi-Government pensioner was correctly being so regarded and whether the dividing line was drawn at the right place. Those discussions in the Working Party are now in train. Secondly, I should like to go back to the earlier point: that the Bill provides, without any shadow of doubt, the power to bring these people within its scope should there be a decision at any time in the future to treat them, or some of them, in this way. That is all I can say at this stage on that particular point.

My Lords, I am afraid we have overrun now by the large amount of forty minutes our normal 4 p.m. deadline on a Friday, but may I just say, in conclusion, that something that the noble Lord, Lord Gore-Booth, said affected my own Department, and although it particularly pleased me I hope I can be sufficiently objective to stand back a little from the argument which he advanced. I believe that this type of legislation springs easily from a Government structure which includes a Civil Service Department with its own specific and defined areas of responsibility. I think, without being unduly immodest so far as my own Department is concerned, that this is probably objectively the effect. Having said that, I would again thank noble Lords for the general welcome which they have given to the Bill, and wish to say in conclusion that I think they feel, with me, that it represents a not inconsiderable advance. Perhaps we may push the frontiers a little further back over the next decade or so, but I think this represents a very big push indeed. I beg to move.

On Question, Bill read 2a, and committed to a Committee of the whole House.