§ 3.10 p.m.
§ The Lord President of the Council (Viscount Whitelaw)
My Lords, I beg to move that the House do now resolve itself into Committee on this Bill.
§ Moved, That the House do now resolve itself into Committee.—(Viscount Whitelaw).
§ On Question, Motion agreed to.
§ House in Committee accordingly.
§ [The EARL OF LISTOWEL in the Chair.]
§ Clauses 1 to 3 agreed to.291
Lord Ponsonby of Shulbredemoved Amendment No. 1:
After Clause 3, insert the following new clause:
("Pensions of members.
. In section 7(1)(d) of the 1972 Act for the word "sixty-five" there shall be substituted the word "sixty".").
The noble Lord said: In moving this first amendment I should like at the outset to say that it is not normal for your Lordships to propose detailed changes to a Bill of this sort, because such a Bill deals primarily with matters of concern to present Members of another place. However, this particular Bill does have certain retrospective implications which affect some Members of your Lordships' House, but of course these are in the minority in your Lordships' House. There are some 22 Members of your Lordships' House who were Members of another place until the last general election and those Members are being treated in a different way, according to the length of their service in another place.
§ Those Members who retired at the last general election, who had reached the age of 60 and who had the full 20 years' service, will be entitled to an immediate full pension, whereas those who retired at that election with less than 20 years' service will not be entitled to a full pension appropriate to their years of service until they have reached the age of 65. They are, of course, entitled under this Bill to take an actuarially reduced pension once the Bill becomes law, but I question whether it is right to divide former Members of another House into two different classes and that they should be treated differently solely on the question of the years of their service in another place.
§ Surely, the age at which the full, unreduced pension is payable should be the same for all. The Civil Service has a universal retirement age of 60 and it would seem right, as there are so many proposals around (and indeed we shall be discussing some tomorrow) for linking salaries and allowances in this House with Civil Service rates, that serious consideration should be given to this suggestion.
§ I know the claim will be made by the Leader of the House that it will be very expensive to introduce an amendment of this sort and it would require the whole level of contributions to be reviewed. I accept that it may not be possible to insert this amendment in this particular Parliamentary Pensions Bill at this time, but it is an issue which will have to be faced at some time. Of course, unlike the Civil Service, it does not mean that the pensions will be automatically payable at 60 because many Members retire or cease to be Members of another place at a very much later age than 60, and of course they will not draw pensions until that time. I beg to move.
§ Viscount Whitelaw
I am grateful to the noble Lord, Lord Ponsonby of Shulbrede, for raising this issue, which I agree with him is important. He will appreciate that there are problems, as he said at the end, in dealing with the matter in this particular Bill. He has also, of course, correctly anticipated some of the arguments I am going to use. That will not stop me from using them briefly, but he has anticipated them quite rightly and quite properly. Equally, we have to face some of the harsh realities.
292 The new clause would be a drastic change in the nature of the scheme. The present normal retiring age of 65 reflects the present retirement pattern for Members of Parliament. A great many Members of Parliament continue in service after 65 and only a few choose to retire voluntarily as early as 60. Most Members of Parliament, I believe, want to remain Members for as long as possible unless, of course, they have the honour to be elevated to your Lordships' House.
I realise that I am skating on very thin ice in respect of nearly all the arguments I have used. I myself did not retire voluntarily from the House of Commons at the last election, but I had the great privilege of being removed from it to your Lordships' House. Therefore, I welcomed that translation and I have had no reason since not to welcome it all the more. I realise that I am one of the lucky few: nevertheless, I am involved.
On three occasions the TSRB has considered whether the normal retirement age should be reduced, and has decided that in view of the normal retirement age of the working population as a whole it would be wrong to recommend a lower age for Members of Parliament. Instead, it recommended further flexibility in the provisions dealing with early retirement. As the House knows, a considerable extension of these provisions, which I think we would all agree is right, is already contained in the Bill.
As the noble Lord, Lord Ponsonby of Shulbrede, anticipated, I have to say that the general lowering of the retirement age would indeed be expensive. Many other aspects of the Bill would have to be looked at again if the new clause were inserted, including the 9 per cent. contribution rate. I do not think that Members of this House should necessarily assume that the proposed change would be welcome to Members of the House of Commons, many of whom already feel that the proposed 9 per cent. contribution rate is high enough already. I think the noble Lord anticipated that comment but, for what it is worth, there it is.
Perhaps I should conclude by saying that I think it is important to have this exchange to appreciate the problems that do affect Members of Parliament, and really the different problems that affect them at this particular age. No doubt, as the noble Lord suggested, this proposal should be considered on a future occasion. If, therefore, on this occasion we have called attention to it and given the opportunity to make sure that it is considered again, I think that is the right way for us to proceed. I am very grateful to the noble Lord, Lord Ponsonby, for raising this question but, in view of the arguments I have produced and because of the way he has anticipated some of them, I hope he will see fit to withdraw his amendment.
§ Lord Ponsonby of Shulbrede
I thank the noble Viscount for his reply. Of course, I accept a number of the things he has said. The question, of course, is not the need to retire at 60, but the availability of the pension at the age of 60. However, having said that, and having placed this on the record, I beg leave to withdraw the amendment.
§ Amendment, by leave, withdrawn.293
§ Clause 4 [Earlier entitlement to pension]:
§ Lord Ponsonby of Shulbredemoved Amendment No. 2:
Page 9, line 9, at end insert—
("( ) after the word "House" there shall be inserted the words "or United Kingdom Representative to the Assembly of the European Communities; and" ").
The noble Lord said: This amendment has been put forward at the request of one of the trustees of the European Assembly pension scheme. I understand that there is concern among MEPs and former MEPs that service as an MEP should count for the purposes of arriving at the 20-year qualifying period for a full pension. The position is that there are now former MEPs in another place and that their service as an MEP, while of course counting for their own pension entitlement, does not add to the time for calculating the 20-year period to enable a pension to be drawn at age 60.
§ If the previous amendment had been agreed to and had been inserted in the Bill, there would have ceased to be any particular magic in the 20-year period and this amendment would not have been necessary. However, there is a logic in agreeing to this amendment without opening the door for claims to be made that people who have previous service in other acceptable pension schemes should also be included, because the nature of membership of the European Assembly is in many ways akin to and involves the same stresses and strains as those which membership of another place involves. Therefore, I should like to move this amendment so that those who were formerly MEPs can use that period of service for counting up to the 20-year period. I beg to move.
§ Viscount Whitelaw
Again, I am grateful to the noble Lord, Lord Ponsonby of Shulbrede, for raising this issue. He makes a persuasive case, but I hope I can show him that I have equally good reasons for disappointing him. There is a separate pension scheme for United Kingdom Members of the European Assembly, which follows closely the provisions of the parliamentary scheme. Both schemes will incorporate the improvements already in the Bill, including the early retirement provision. It will continue to be possible to transfer service from one scheme to the other for the calculation of normal pension benefits or, if the individual prefers, to draw two separate pensions relating to different periods of service in Strasbourg and in Westminster.
The amendment would have the effect of treating service in the European Assembly as equivalent to service in the House of Commons for the purposes of the early retirement provision, as if service in Strasbourg and Westminster were exactly equivalent. I do not think that this would really be right. It is not possible to count service brought in from other employment towards the length of service qualification because this would destroy the main purpose which is to help those who may find it difficult to secure alternative employment when they are no longer young after a long career in the House of Commons.
It may be suggested that service in Strasbourg can be equally damaging to one's job prospects, and I think 294 we must accept that there is some truth in that. But so long as we have two schemes we should keep them separate in this regard. No doubt there are other forms of employment which Members of the House of Commons may have participated in before their election of which the same could be said.
Keeping the schemes separate does carry its own advantages to Members. For example, a Member of Parliament who is receiving a pension from the European Assembly scheme does not at present have that pension reduced while he is an MP or vice versa, although if he had been receiving a pension from the parliamentary scheme it would have been stopped when he re-entered Parliament. Clearly, that is something that would have to be looked at if this amendment were carried, and I think I have to say to the noble Lord that there might he others. The main point is that there are separate schemes, and I think on balance it is right to keep them in that position. Having raised what I accept at once is an important point, I hope that the noble Lord will feel able to withdraw his amendment.
§ Lord Broxbourne
Before the noble Lord responds to the request of my noble friend, the Committee will no doubt be relieved to hear that I do not propose to contribute to the point at issue in this debate, though on its substance, speaking as a former Member of the European Parliament, I would respectfully agree with what my noble friend the Leader of the House has said. But I rise on a point of clarification which perhaps the noble Lord, Lord Ponsonby of Shulbrede, will be good enough to clear up. The amendment reads:Page 9, line 9, at end insert—after the word 'House'.I have studied page 9, line 9 of the Bill and I do not see the word "House". Conscious, as always, of the possibility of error on my part, I took the precaution of consulting my noble friend Lord Maude of Stratford-upon-Avon, whose omniscience is well known to your Lordships, and he is in consimili casu. Can the noble Lord kindly oblige?
§ Lord Ponsonby of Shulbrede
The noble Lord raises an interesting point. Indeed there was some complexity in the drafting of this amendment, because it is an amendment to the Parliamentary Pensions Act 1978 which amended the 1972 Act, and this clause in this Bill is amending Section 1 of the 1978 Act which amended Section 7 of the 1972 Act. In order for the noble Lord to be able to make full sense of this, he will have to get a copy of the Parliamentary Pensions Act 1978. I hope that that gives him the explanation he wanted.
Before withdrawing the amendment, I hope that the noble Viscount, the Leader of the House, will agree that this is something else which the Top Salaries Review Body could look at when they next come to reconsider the whole queston of parliamentary pensions.
§ Viscount Whitelaw
It would be ungracious indeed after the noble Lord's remarkable explanation of something of which I had not the smallest idea, if I did not respond to him appropriately and say that of course that is exactly what we will do.
§ Amendment, by leave, withdrawn.
§ Clause 4 agreed to.
§ Remaining clauses and schedule agreed to.
§ House resumed: Bill reported without amendment: Report received.