HL Deb 24 November 1981 vol 425 cc662-4

2.38 p.m.

Lord Monk Bretton

My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.

The Question was as follows:

To ask Her Majesty's Government how many London Transport employees have received a present of £50 from the Greater London Council recently, and whether these sums are taxable.

The Earl of Avon

My Lords, this is a matter for London Transport but I understand that the £50 payment was agreed during the wage settlement negotiated this summer. It is payable to all London Transport employees except the top management and will form part of their taxable emoluments. The Greater London Council are only directly involved through the revenue support they pay towards London Transport's operating deficit.

Lord Monk Bretton

My Lords, may I thank my noble friend for that reply. As I gather that this perquisite may have cost nearly £3 million, may I ask my noble friend whether he would not view it as a serious matter if this particular habit of paying out compensation for what might best be described as assumed loss of value in travel concessions spread to other areas, such as to British Airways because of lower fares brought about by competition from Sir Freddie Laker, or to British Rail because of cheaper away-day facilities offered to the public? Does my noble friend not think that perhaps this practice has gone far enough?

Thr Earl of Avon

My Lords, such payments are really a matter for negotiation between the managements in question and their employees. Obviously, however, the Government deprecate irresponsible pay settlements, particularly in the present difficult economic climate.

Lord Gisborough

My Lords, can my noble friend say under what by-laws these payments are made, and whether there is any limit to the amount of payment that can be made either to all the staff or to individual groups of staff for various good reasons?

The Earl of Avon

My Lords, I do not think this is a question of by-laws; this is a question of a negotiated settlement between the interested parties, and in particular of course it takes London weighting in view.

Lord Bruce of Donington

My Lords, would the noble Earl put golden handshakes in the same category?

The Earl of Avon

My Lords, no.

Lord Balfour of Inchrye

My Lords, would it not be rather inconsistent and rather unfair if the final result of this was that the Revenue now wish to take in tax a large percentage of all Christmas gifts to servants of clubs all over the country while these people get away with £50 without paying tax on it?

The Earl of Avon

My Lords, I think my noble friend is a little wide of the mark here, because this is a taxable emolument and it is part of a negotiated settlement.

Baroness Wootton of Abinger

My Lords, is it not a fact that the Government are strongly in favour of free collective bargaining and that this appears to be the result of free collective bargaining?

The Earl of Avon

My Lords, that is why although we deprecate it in some terms we do not deprecate it in others.

Lord Orr-Ewing

My Lords, would my noble friend say that "negotiated settlement" means that in this case the ratepayers were strongly represented in the negotiations between those who were getting the gift and those who were giving it?

The Earl of Avon

My Lords, this particular settlement was of course a matter for London Transport, and the ratepayers are affected because they are the people who give London Transport the subsidy.

Lord Underhill

My Lords, as the noble Earl referred to irresponsible wage increases, will he say whether or not in his view £50, less tax, on top of a low wage award is an irresponsible increase?

The Earl of Avon

My Lords, I would not necessarily say so, but if the noble Lord were to suggest that to old-age pensioners, they might agree.

Lord Leatherland

My Lords, can the Minister assure us that a similar method of treatment will not be applied towards the passengers on London Transport?

The Earl of Avon

I think they are getting away with quite a lot already, my Lords.

Viscount St. Davids

My Lords, would the Minister agree that some of the subsidies being granted by local councils to their workers are really quite extraordinary? Is he aware, for example, that Camden Council is now subsidising the lunches of some of its workers to the tune of £3.75 a day, a sum which in your Lordships' House would buy a three-course lunch and wine?

The Earl of Avon

My Lords, I am grateful for the noble Viscount's culinary expertise. The Government are opposed to inefficient, indiscriminate and in equitable subsidies, but we recognise that public transport needs a measure of support and that is one of the purposes for which expenditure is accepted for transport supplementary grant.

Lord Brockway

My Lords, is not the real issue here the contrast between what the labour force receive in wages, amounts which are such that often they are unable to meet the cost of living, and the amazing gifts to management and directors who are already receiving £25,000, £50,000, even £95,000 a year? Is not that the real issue in this Question?

The Earl of Avon

No, my Lords.

Lord Molloy

My Lords, is the Minister aware that many of the ordinary people who work for the GLC are also ratepayers? Would not the Government be showing a much more responsible attitude if they were investigating the £9 billion that is being fiddled in tax evasion, as revealed in an examination? Does the noble Lord agree that that figure is absolutely astounding, yet in your Lordships' House this afternoon we are straining at a little gnat in relation to working men who might be getting a negotiated increase of £50? Which issue does the noble Earl think should have the priority of the Government?

The Earl of Avon

My Lords, I should hate to trespass on the territory of my noble friend Lord Cockfield, which I feel that most of the answer to that question would do.

Lord Monk Bretton

My Lords, would my noble friend agree that the most significant aspect of this matter is the need to bear in mind that waste of public money must inevitably contribute to increased unemployment?

The Earl of Avon

I entirely agree with my noble friend, my Lords.