§ 1A In subsection (1)(a) after ("training") insert ("or to any other relevant benefits, facilities or services to which sub-section (2) applies").
§ Lord Wedderburn of Charlton
My Lords, I beg to move that this House do agree with the Commons in their Amendment No. 1, as amended by Amendment Nos. 1 A to 1E. We thank the Secretary of State for taking us through Amendment No. 1 from another 957 place. As this is the first time that your Lordships have seen these new clauses, it would be right to subject them to scrutiny. We give them a muted welcome. Welcome, because it is right that we come into line with the judgment of the European Court of Justice as we must. However, we have problems with the new Clauses 1 and 2, both as regards their general policy and substance which my noble friend will speak to later, and also in respect of the result of the Government's own logic, or the narrow objection which these amendments make.
In moving Amendment No. 1A, I understand it would be right if I spoke to Amendments Nos. 1 B, 1C and 1D. In our contention, reflected in these amendments the new clauses may well not satisfy the standards of the Community directive and the Marshall judgment of the court which interprets it. As the Secretary of State has said this is the directive which requires equal treatment in working conditions for men and women, including dismissal. It is true that the directive appears to exclude social security matters which are dealt with by a different directive.
As we understood the Government's position as it was put in another place and is reflected in the speech of the Secretary of State, the Government take the view that social security matters including occupational pension schemes, and redundancy payments cannot he dealt with and need not be dealt with under this judgment. We take issue with both those points, but not now. These amendments accept those two points, whether they are right or wrong, and accept them on the Government's own statement. Categorisation of redundancy payments as social security matters, which we understand to be the Government's position, seems to us to be highly odd, both in history and in logic, but we shall come to that later.
Accepting both of those points, we then face the statement that the new clause (which will be the amended subsection (4) of Section (6) of the 1975 Act) is to match up to the standards of the Marshall judgment, apart from occupational pension schemes and redundancy payments, under statutory schemes.
If one looks at the 1975 Act one finds that Section 6(2), except so far as it is limited by other subsections—including subsections (6) and (7), which are not here relevant—tells the employer not only that he must not discriminate directly or indirectly in offering employment which has already been laid down, but that he must not do so:in the way in which he will afford … access to opportunities for promotion, transfer or training or to any other … benefits, facilities or services",or by refusing or deliberately omitting to afford her access to them. It is with those words in paragraph (a) of subsection (2) that these amendments are concerned.
The amendments do not reflect that formula quite apart from the issue of occupational pension schemes and redundancy payments which we put aside by our Amendment No. 1D as, for the moment, common ground. The new clause and the new subsection (4) would prevent discrimination in relation to retirement. It is concerned with offers of employment, dismissal, detriment involving demotion and 958 promotion, transfer or training. That is to say, it would not include any phrase relating to benefits, facilities or services. The effect of our amendments would he to introduce the words "benefits, facilities or services" over the same range as subsection (2), apart from occupational pension schemes and redundancy payments matters.
The only two objections advanced by the Government, (so fat as we can see) to the words "benefits, facilities and services" are that they would cover occupations pension schemes and redundancy payments. Those two matters we have put aside and we say to the Government: surely these words should then be inserted? If they are not inserted, the result would be, and I hope I do not misrepresent the words of the Secretary of State, however, when I see Hansard I will see if I have done so—I believe in his introductory speech the Secretary of State said that these would broadly reflect discrimination in Section (6) of the 1975 Act. However, "broadly" is not enough.
In another place, the Government appear to have accepted that the omission of the words "other benefits, facilities and services" quite apart from the points on occupational pensions and redundancy would allow for lawful discrimination in relation to retirement so far as concerns detriments and lack of benefit of retraction of benefit.
Perhaps I may quote the Parliamentary Under-Secretary, which is all that we have so far. At col. 199 of the Official Report of Standing Committee A. he said:The denial of a benefit that was a key part of the employment contract would be a detriment entitling an employee to claim that she had been constructively dismissed".I pause there. Of course that may be so. However, anyone who has ever looked at the case law on constructive dismissal should not rely only on that. The Parliamentary Under-Secretary continued:Therefore unlawfully discriminated against, under subsection 1(c) of the new clause. It is unlikely that any employer would, for example, allow both sexes to work until 65, but remove from women at 60 some minor facility such as the use of the canteen, or discount purchase arrangements. We do not expect employers to be petty in that way and to deny such benefits, but if it happens in practice we shall look at the provision again".That is not good enough. That is a brief for counsel in the European Court of Justice at Luxembourg if an employer does anything of that sort. It may be petty, but it does not meet equal treatment and it will not he unlawful under the Act.
Similarly, there are many types of situation where an employer might well make an adjustment in respect of women in his workforce who used to retire at 60. Perhaps, somewhat to his annoyance, expecting to be relieved of burdens of business, he now finds he cannot insist that such women should be retired at 60. It may be that without intending to discriminate he or his managers make an adjustment, for example, in the hours of work. That might not be easy for women of 60 and over in his workforce to bear, compared with the men. There are many such situations which might arise. They may be petty, but they would be indirect discrimination, or they could be. They would not necessarily be prohibited by the new measure unless it contains some words of the kind that we submit in our amendments.
959 It is no affront to another place, nor indeed to the Government to say that this is a difficult matter. In saying that, perhaps I may apologise for the inconvenience that we have caused to your Lordships and to others, by the late revision of our own amendments at a late stage. It is not an easy matter. However, we very much hope that the Secretary of State would feel able to accept these amendments as we see no other way in which this could be put right. We understand the points on occupational pension schemes and redundancy payments. We will come to that later. However, accepting those, we still say that if the only objections to parallel words with subsection (2) in the new subsection (4) are occupational pension schemes and redundancy payments—and we have provided for that in our Amendment 1D—why not then deal with discrimination in a precisely parallel way so that there is no risk of someone taking up that kind of case and yet again our finding that the United Kingdom is subjected to a judgment against it, on sex discrimination in the Luxembourg Court. I am sure the Government wishes, as we do, to ensure that that cannot happen. It is not enough to say that it might not happen even though a petty discrimination would still be lawful. I very much hope that the Government will look upon this with favour. There are adequate procedures between here and another place for the matter to be dealt with speedily. It is a small matter and I hope it will be accepted.
§ Moved, that this House do agree with the Commons in Amendment No. 1, as amended by Amendment No. 1A.—(Lord Wedderburn Charlton).
§ 6.30 p.m.
§ Baroness Platt of Writtle
My Lords, the Commission welcomes the Government's prompt reponse to the European Court decision in Marshall v. Southampton and South West Hampshire Area Health Authority and the removal of sex discrimination based on retirement age as regards access for opportunities for promotion, transfer or training and in relation to dismissal or demotion.
This proposal goes wider than the strict terms of that decision, which dealt only with dismissal. It is a recognition by the Government of the broad scope of the EC Equal Treatment Directive. It is also a recognition that existing legislation is in breach of the Equal Treatment Directive as regards both private and public employers, notwithstanding that only employees in the public sector can rely directly on the provisions of the Equal Treatment Directive.
The Commission remains very concerned at the failure to tackle the anomalies and differences in treatment between men and women which result from the unequal state pension age. For example, a woman between the ages of 60 and 64 will have the option of deferring retirement beyond the state pension age. She will no longer be required to pay the national insurance contributions, and her eventual state pension and entitlement will be enhanced for each year of employment over the age of 60.
In contrast, a man will gain no such option. At col. 192 of the Official Report in another place it was accepted by the then Parliamentary Under-Secretary 960 of State for Employment, Mr. Ian Lang, during the Committee stage of the Bill that:we all agree that discrimination in retirement will not be eliminated until there are equal state pension ages for men and women".The Commission will continue to press strongly for the equalisation of the state pension ages for men and women. Until that is done there will be continual anomalies that discriminate against one or the other sex.
Naturally, sufficient warning needs to be given of such a fundamental change to all those concerned—employers, employees and particularly pension funds. We make a strong representation to the Government to give serious consideration to this matter so that an announcement can be made of their firm intention to equalise the pension ages between men and women on a specific date in the future. Then all could work together to prepare for the achievement of that very desirable goal for both men and women.
In our view, a defect of these clauses is the omission from paragraphs (a) to (c) of Clause 2(1) of words which appear in the comparable paragraphs of Section 6(1) and (2) of the Sex Discrimination Act 1975 dealing with access to benefits, facilities and services and subjecting a person to any other detriment. The Government seem to intend that sex discrimination shall be unlawful to the extent that these issues are related to death or retirement, in order that occupational pensions shall be excluded. We believe that this objective could be achieved by a direct reference to pensions.
The present provision could introduce uncertainty in the law which might lead to further litigation, and the Commission would therefore be supportive of these present amendments, Nos. 1 A to 1D, and hope that the Government will either accept them or incorporate their sentiments in the Bill.
§ Lord Monson
My Lords, I have a question for the noble Lord the Minister which I am afraid does not relate to Opposition Amendment No. 1A but to the original amendment, Amendment No. 1, as it came from the House of Commons; and it relates to the speech which we have just heard. I ask the question now because it seems that there will be no other opportunity to do so. Can the noble Lord confirm, as I have heard suggested, that one of the consequences of Amendment No. 1 is that a woman who stays on at work until the age of 65 will draw a higher state retirement pension than will a man who retires at precisely the same age? If that is so, it seems to be blatant discrimination against men, particularly as a woman's life expectancy at the age of 65 is approximately 7½ years greater than that of a man of the same age.
§ Lord Jacques
My Lords, I should like to raise two questions. Today it is common practice for employers to have service contracts with their employees providing that, in the case of men, the normal retirement age will be 65 and, in the case of women, 60. This Bill gives such employers one year in which to put their house in order. There is therefore an interim period. However, some of these employers are already defendants at industrial tribunals. They have been 961 taken to the tribunal by a female employee who says that she cannot be compulsorily retired at the age of 60, and so they are already before the tribunal.
My two questions relate entirely to this interim period of 12 months. The first is whether in this interim period the European Court's judgment overrides British legislation as regards the private sector. Secondly, what protection is given to responsible employers seeking to observe British law but who are faced with legal action arguing that it has been superseded by the European Court's judgment? I would emphasise again that the questions relate only to the interim period.
§ Lord Diamond
My Lords, we on these Benches have no questions to ask. I rise merely to say very shortly that, having heard all the arguments and having read what preceded this, we are in full support of what has been put forward by the Labour Front Bench.
§ Lord Young of Graffham
My Lords, in introducing Amendment No. 1 I emphasised to your Lordships my welcome for the new provisions on retirement as a further important step towards equality in employment. I appreciate that the noble Lords who have supported these amendments are simply seeking to ensure that in relation to retirement, all differences in treatment of men and women should be unlawful except those connected with occupational pensions. This may seem a laudable aim, and the noble Lords, Lords Wedderburn and McCarthy, may say they think me inconsistent if I oppose it, but I am afraid that I must do so.
I do so on two grounds. First, although noble Lords opposite have in Amendment No. 1D sought to introduce an exclusion for occupational pension schemes and redundancy payments, I have to tell them that this current amendment does not exclude matters relating to the state pension. As I have already said, this Bill cannot affect either state or occupational pension schemes.
Secondly, I do not think that the amendment is necessary. Denial of a benefit which was a key part of the employment contract would be a detriment entitling an employee to claim she had been constructively dismissed and therefore unlawfully discriminated against in accordance with subsection 1(c) of this clause. On the other hand, if an employer were so petty as to arrange for men and women to gain or to lose minor benefits at different ages, this would not be lawful unless it were held to be "provision in relation to retirement". It is, for instance, unlikely that an industrial tribunal would regard it a "provision in relation to retirement" to deny one sex, say, use of the company canteen between the ages of 60 and 65. It is surely very unlikely that any employer would allow both sexes to work to 65, but to deny women at 60 some minor facility, such as use of canteen or discount purchase arrangements. If they did so and in the possibly unlikely event that women could not obtain redress through an industrial tribunal, we would certainly want to look at this again.
To sum up, the new clause in Amendment No. 1 will prevent most discrimination in relation to retirement; and the Bill prevents discrimination in 962 benefits, facilities and services, except in relation to retirement. In view of this and the "knock-on" effect of the amendment on state pensions, I ask the noble Lords to withdraw this amendment. If not, I must ask your Lordships to reject it.
Perhaps I may deal with the particular question which was put to me by the noble Lord, Lord Monson. A woman will have a higher pension if she has paid contributions in her own right throughout her working life. Because of family responsibilities and career breaks, in practice this happens very rarely.
§ Lord Wedderburn of Charlton
My Lords, in regard to Amendments Nos. 1A, 1B, 1C, and 1D, to which the House is now directing its attention, I have to say to the noble Lord the Secretary of State that at the core of his argument, which he has just addressed in reply, is that element which is the tomb of all legislation in all courts—namely, that that which is not covered is unlikely. Anyone who looks at a set of law reports for a minute will know that the most unlikely things are the things that are litigated upon. The canteen example was not my example, it was the example of the noble Lord's colleagues in another place. The Government's own Ministers advanced this example of their own good will to the Opposition to let them see what would happen, and they said, "Yes, this would happen. It would not be covered by the Bill". The Secretary of State agrees with that, and says that it is unlikely.
That is a brief for a case to the United Kindom. Why do the United Kingdom Government constantly legislate in order to invite lawyers to earn fees before the court in Luxembourg? My brethren in practice will be happy indeed, but this will be a big case. There will be a lot of people who litigate it. I cannot understand why the Government do not accept this.
There were two other arguments. One was that if we had our wording it would include the differential in the state pension. It might do so, but it would hardly then be a discrimination by the employer. Maybe the Secretary of State was looking ahead to the day he privatises pensions completely and then the employer would discriminate, but the payment of a state pension at 60 and 65 is not a discrimination by the employer and I submit would not fall within the terms of our amendments.
The third point was that if the withdrawal of benefit related to a key part of the employment relationship then that would be within the clause either as a demotion or a dismissal. I accept that. I accepted in moving that if it were a constructive dismissal it would be caught, but what I advance is the argument that not every withdrawal of a benefit is at a key part, is a demotion—and I shall come to that in a minute—or is a constructive dismissal, and I do not see how anyone could contravert that.
This Bill will allow benefits to be withdrawn, perhaps by the employer with the best motives, because we all know that indirect discrimination is part of our society and occurs naturally. We are a sexist society, we hope gradually becoming less so. But it is quite possible that managerial arrangements dealing with a workforce where they have become used to women retiring at 60, will include adjustments where the women are discriminated against indirectly.
963 The Secretary of State's answer does not go to that point. We are put in a difficult position because the reply really does not give any answer to the point. What is our responsibility? Is it not to test the opinion of the House to try to prevent unnecessary litigation? Is that not our responsibility? I have tried to hear the advice of my noble friends in the last few minutes, and I take it to be very stern. I feel that we shall have to do that.
§ 6.42 p.m.
§ On Question, Whether the said amendment (No. 1A), as an amendment to Commons Amendment No. 1, shall be agreed to:
§ Their Lordships divided: Contents, 53; Not-Contents, 76.964
|DIVISION NO. 1|
|Ardwick, L.||Lockwood, B.|
|Attlee, E.||McCarthy, L.|
|Blyton, L.||McGregor of Durris, L.|
|Brockway, L.||Mclntosh of Haringey, L.|
|Brooks of Tremorfa, L.||Mar, C.|
|Bruce of Donington, L.||Mishcon, L.|
|Carmichael of Kelvingrove, L.||Mountevans, L.|
|David, B.||Northfield, L.|
|Davies of Penrhys, L.||Pitt of Hampstead, L.|
|Dean of Beswick, L.||Ponsonby of Shulbrede, L. [Teller.]|
|Elwyn-Jones, L.||Prys-Davies, L.|
|Ennals, L.||Rhodes, L.|
|Gallacher, L.||Ross of Marnock, L.|
|Galpern, L.||Stedman, B.|
|Grantchester, L.||Stewart of Fulham, L.|
|Grey, E.||Stoddart of Swindon, L. [Teller.|
|Hanworth, V.||Strabolgi. L.|
|Houghton of Sowerby, L.||Taylor of Blackburn, L.|
|Jacques, L.||Taylor of Mansfield, L.|
|Jeger, B.||Underhill, L.|
|John-Mackie, L.||Wedderburn of Charlton, L.|
|Kilmarnock, L.||Wells-Pestell, L.|
|Kinloss, Ly.||White, B.|
|Kirkhill, L.||Winstanley, L.|
|Lawrence, L.||Ypres, E.|
|Llewelyn-Davies of Hastoe, B.|
|Ailesbury, M.||Gray of Contin, L.|
|Ampthill, L.||Gridley, L.|
|Beaverbrook, L.||Hailsham of Saint|
|Belhaven and Stenton, L.||Marylebone, L.|
|Belstead, L.||Harmar-Nicholls, L.|
|Blyth, L.||Harris of High Cross, L.|
|Boyd-Carpenter, L.||Hesketh, L.|
|Brabazon of Tara, L.||Hives, L.|
|Butterworth, L.||Home of the Hirsel, L.|
|Caithness, E.||Hooper, B.|
|Cameron of Lochbroom, L.||Hylton-Foster, B.|
|Campbell of Alloway, L.||Lane-Fox, B.|
|Carnegy of Lour, B.||Lauderdale, E.|
|Coleraine, L.||Layton, L.|
|Constantine of Stanmore, L.||Lindsey and Abingdon, E.|
|Craigavon, V.||Long, V.|
|Davidson, V. [Teller.]||Lucas of Chilworth, L.|
|Denham, L. [Teller.]||Malmesbury, E.|
|Elles, B.||Mancroft, L.|
|Fortescue, E.||Massereene and Ferrard, V.|
|Fraser of Kilmorack, L.||Maude of Stratford-upon-|
|Geddes, L.||Avon, L.|
|Glanusk, L.||Merrivale, L.|
|Mersey, V.||Russell of Liverpool, L.|
|Montgomery of Alamein, V.||Sandford, L.|
|Munster, E.||Selkirk, E.|
|Murton of Lindisfarne, L.||Shannon, E.|
|Napier and Ettrick, L.||Sharpies, B.|
|Nugent of Guildford, L.||Skelmersdale, L.|
|Onslow, E.||Stanley of Alderley, L.|
|Orr-Ewing, L.||Strathclyde, L.|
|Pender, L.||Tranmire, L.|
|Peyton of Yeovil, L.||Trefgarne, L.|
|Portland, D.||Trumpington, B.|
|Rankeillour, L.||Vaux of Harrowden, L.|
|Reay, L.||Vivian, L.|
|Reigate, L.||Ward of Witley, V.|
|Renton, L.||Whitelaw, V.|
|Renwick, L.||Young of Graffham, L.|
§ Resolved in the negative, and amendment to the amendment disagreed to accordingly.
§ 6.50 p.m.
§ On Question, Whether this House do agree with the Commons in their Amendment No. 1?
§ Lord McCarthy
My Lords, I am now moving to a general debate on Amendment No. 1. This is the point where we want to widen the argument, as the noble Lord, Lord Wedderburn, said. We gave a muted welcome to the general purposes of these amendments because they bring into effect—I am being told something else. I move that we do not move Amendments Nos. 1B to 1 E. We wish now to raise two general points. They concern the consequences of the Marshall case and whether or not the Government have fully taken into account, as we see it, all those consequences.
I am glad that the Secretary of State says that he is in favour of and welcomes the Marshall decision itself. The Parliamentary Secretary in another place said of Miss Marshall, at col. 192 on 1st July:I pay tribute to her. Her name will join the long list of those who have blazed a trail on behalf of women's rights, even though she herself may not derive direct benefit from the changes that we are now making".If the Government pay tribute to her, and if she has blazed a trail, the only wonder one has is as to why the Government had to fight her all the way to the court and whether they are taking fully into account all the principles inherent in the judgment.
We have two grounds for concern today. The first ground—it was covered in the debate in another place, but we were not satisfied—is what the Government intend to do about4he related area of discrimination of statutory retirement pensions and voluntary pension schemes. The Government say, if I understand their position, that they will leave that for the time when they need to implement the decision of the Council of Ministers, the directive on occupational social security schemes, which was adopted on 5th July last, and that this will not be required for another three years, by which time very likely they will not be in office and will not have to consider it anyway. Our position is that we do not think this will quite do.
We understand why they say this. We understand the arguments, but we feel that even if they were right in the sense that it could not be done in this Bill, they 965 might indicate to us how they see the implications of the Marshalll case in this area. They might tell us, if they were to remain in office, what they intend to do when it is necessary to bring into effect the European directive. They might say something about what they regard as the cost of implementing the consequences of the directive in that area.
As I understand it, the Government say that the main reason why they cannot go on to produce equality in respect of retirement pensions is cost. In another place the Government have said that the immediate cost of reducing the pension age to the starting point for men of 60 will be about £3 billion. We doubt whether that is a real estimation of the cost. Is it not the case that this assumes that most men will retire at 60 and that most women will not want to stay at work after 60? We feel that this view, which is the basis on which the Government presumably produce the estimate of £3 billion, could exaggerate the direct exchequer cost. Surely there are many workers, women workers in particular, for whom these are the high income years. Given a statutory right to retire they might not retire, especially since the pension is higher when eventually they do retire. If this is the case, surely the cost of £3 billion would be substantially reduced.
But even if it were not, and even if the cost were considerable, have the Government given sufficient consideration to the possible benefits from the point of view of the level of unemployment—a matter which we know is always close to the heart of the Secretary of State; to the effect on the level of unemployment if there were a significant reduction in the age of retirement in this country? After all, following legislation introduced by the previous Government, the Government operate, and in some ways have extended, a job release scheme which provides subsidies for early retirement, the objective of which is to reduce the level of unemployment. Surely there is a case for trying to encourage still more early retirement by lowering the male retirement age as soon as possible, so long as something is done to make the retirement benefits reasonably attractive to those who do retire.
We should like to know what the Government feel they need to do and want to do about these aspects of what we consider follow from the consequences of the Marshall case, even if we accept their point that it cannot be done in this Bill tonight. We are not satisfied with the arguments given on this point in another place.
So I come to our final area of concern, which deals with redundancy payments. The fact is that although now, as a result of the Bill, men and women must retire at the same age within a particular firm, men qualify for redundancy payments until they are 65, but women's right to redundancy payments ends at 60. As we understand the Government, they defend this; or rather let me be fair to them. they defend it until they can bring the statutory retirement age into equality.
Indeed the Parliamentary Secretary in another place, when dealing with this aspect of the problem in answer to questions posed by the Opposition, said at col. 199 on 1st July that he would expect to see considerable grievances if he did anything else: 966If employees are … made redundant between the ages of 60 and 65, a woman can claim her old-age pension, and a man his redundancy payment. … A woman made redundant at 61 can immediately claim state pension, which is higher than unemployment benefit if it is based on her own contributions, and is irrespective of savings".He went on to conclude:The man would surely feel aggrieved if she received a redundancy payment in addition". [Official Report, Commons, Standing Committee A, 1/7/86: cc. 192 & 199.]This is advanced, as I understand it, in all seriousness by the Government as the sole reason for not changing, or not proposing to change until three or four years' time, the present considerations which apply to redundancy payments. If that is what the Secretary of State wishes to tell us tonight, then we have four things to say: first, we do not think that one can compare a one-off redundancy payment, which is based on length of service and the level of pay (which was originally introduced to promote mobility) with either a state pension based on the needs of a permanently retired person or with an unemployment benefit based on an assumed temporary absence from the labour market. We consider that this was intended and designed originally for a quite different purpose. We consider that the justification for redundancy pay is either that the individual has some job right invested in a job which has been disrupted or that he or she has lost a job and in the circumstances of the present labour market is unlikley to get another job, at least immediately and therefore there should be some compensation based upon length of service and level of pay, and that this happens to both men and women. In the Parliamentary Secretary's example it happens to both men and women and there is no evidence as far as we can see that men, as against women, would complain if the justice of this case was met. Secondly, we would say that, given levels of pay for women, redundancy pay in most cases for them would be significantly below that of men anyway.
Thirdly, we say that, given the ending of redundancy rebate—and that is a point of some substance because the Government have done this—so that redundancy pay falls upon the individual employer, the absence of a need to pay redundancy pay to women on the same terms as men is an incentive to employers to select women for redundancy. I know that the Secretary of State will say, because it is a perfectly reasonable reply, that it may be that if someone could prove this before an industrial tribunal it might be unfair dismissal. Then again, it might riot be unfair dismissal.
That is because it might be said that the statutes, the Government and no less a person that the Secretary of State consider this a perfectly just way of carrying on. We say that, given the end of redundancy rebates and the fact that redundancy pay now falls upon the employer, we have here an incentive to employers to select women for redundancy because they will not have to pay the rebates.
Finally, we say that the Government should beware because the Equal Opportunities Commission in its evidence to the Government gave as its conclusion that one cannot separate out the effects of redundancy and the unequal conditions of redundancy pay from what is being done in the area of unfair dismissal. In the next amendment which the Secretary of State will move, he will extend protection for unfair dismissal as 967 a result of the Marshall case. One of the reasons why people can be dismissed unfairly is that they are wrongly selected for redundancy. We say that this means that there is very considerable support for the EOC's argument that the question of redundancy cannot be separated from the other issues involved in the Marshall case.
As the EOC pointed out, the court decision was said to cover working conditions. That is what the court said. As the EOC pointed out, the Government accept that they must include a right not to be unfairly dismissed as a consequence of the Marshall case. If one puts these facts together, we believe that there is a very real possibility that once again—and this is another example to add to the example given by my noble friend—the Government may find themselves back at the European Court having not fully carried out the consequences of the equal treatment directive. For all those reasons, we believe that Government should go further than they go, if not in this Bill then in some other Bill; and we ask the Secretary of State to say so.
§ 7 p.m.
§ Baroness Lockwood
My Lords, I should like to support the noble Baroness, Lady Platt, in her request to the Government that they should make a clear statement about their intention to legislate to remove the inequality in retirement ages between men and women. I should like also to support my noble friend on the Front Bench in asking the Government to state their wider strategy in relation to the Marshall case. I want to do so for all the reasons that have so far been stated both by the noble Baroness and by my noble friends on this side of the House.
A number of anomalies have been mentioned already. The noble Lord, Lord Monson, asked the Secretary of State what would be the position of women who worked until 65 and then drew a retirement pension afterwards. Would they receive the additional supplement that women of that age normally receive, this meaning that they would have a higher pension than men? The Secretary of State said, in effect, that this is true but that it rarely happens because the majority of women do not earn the entitlement to a full pension. That may be so; but some of us have worked for the whole of our working lives and therefore we should be in an advantageous position as compared with men.
My noble friend Lord McCarthy referred to another anomaly which arises for women who are over the age of retirement. I have a third question to put to the noble Lord, a question which relates to women who are in an occupational pension scheme and whose position will be unaffected by this amendment. Although they would be protected from dismissal, demotion and other detriments, their pension entitlement would not be protected in the same way as men's pension entitlements are protected. For example, in many pension schemes a woman is not able to earn additional increments over the age of 60. We are told that when the European directive on equality in occupational pensions comes along that anomaly might be covered and it might be remedied. 968 But how long will it be before such a remedy is effective and what happens in the meantime? There could be cases going through to the European Court on that point, too.
The other anomaly to which I wish to refer comes under Amendment No. 2 to which the Secretary of State referred in his opening remarks. That is protection against redundancy on the basis of the age of retirement. The question of working conditions has already been referred to by my noble friend, but I remind the Secretary of State that some few years ago the Equal Opportunities Commission carried out a formal investigation into the redundancy payments of British Steel. It looked at the implications of the unequal retirement age for redundancy payments not for men and women aged between 60 and 65 but from about the age of 40 onwards. There were discriminatory implications in the whole of their working conditions because of this anomaly in the retirement ages of men and women.
It seems that there is a hornets' nest here and that the Government need to tackle the problem firmly. Even though at this late stage we know that no change to that effect can be made in this Bill, I plead with the Secretary of State as have others, for the Government to make clear their intention and to set up a firm timetable.
§ Lord Young of Graffham
My Lords, perhaps I should start by dealing with the matter raised by the noble Lord, Lords Jacques, about the position of private employers before the proposed amendment to Section 6(4) of the Sex Discrimination Act. It is clear that employees working for a state authority can now rely directly upon Community law, although the meaning of "state authority" is not clear. Other employees cannot rely on the directive in this way and their position under domestic legislation is uncertain. Section 6(4) of the Sex Discrimination Act excludes provision in relation to death or retirement from Section 6(1)(b) and 6(2), which make unlawful discrimination in the terms on which employment is offered, while affording access to opportunities for promotion. transfer, training or any other benefits, facilities or services or in dismissal or subjecting the employee to any other detriment.
The Court of Appeal in the case of Roberts v. The Cleveland Area Health ,4uthority held that compulsory retirement was within Section 6(4) and said it was not unlawful to retire a woman at an earlier age than a man. The present position is therefore that domestic law does not comply with the European directive and private sector employees must wait until our legislation is amended. Even this, however, is not certain, as the case of an employee in the private sector, Mrs. Dukes v. Reliance Systems Limited is to be decided by the Court of Appeal at some future date. It is possible that some indication of the position of employees in non-state authorities will emerge when the Marshall case is heard. The proposed Amendment No. I would mean that neither private employers nor state authorities could discriminate in dismissal.
In dealing with the various matters raised by the noble Lord, Lord McCarthy, let me give him an assurance that we shall be in office in three years' time. Unfortunately, I cannot follow through with a further 969 assurance and tell him today what we shall do then. The Marshall case has enormous implications and running throughout this matter is the great need that we should act in a change of such a nature with all due consideration for costs.
This is primarily a matter for my right honourable friend the Secretary of State for Social Services and I can say that the Government are committed in principle to achieving equal treatment in pension age between women and men. The only problem is how to achieve that. Many men wish to retire at age 60. The cost of reducing men's pension ages from 65 to 60 would be exorbitant. It would be over £3,000 million. Although others may wish to contest that figure, that is our best estimate.
Equally, many men wish to continue working past 60 and, as the Marshall case shows, some women wish to continue working past age 60 also. However, since a pension age of 60 for women has been in force within the United Kingdom since 1940 a high proportion of women and their families have geared their financial planning and expectations towards retirement and pension at that age and might be quite unhappy to see it increased.
In order to resolve these difficulties, the Government set out in the Green paper on reform of social security in June of last year the suggestion of a flexible decade of retirement. Consultations produced no suggestions for how the costs of this poposal, which are still very substantial, could be met. I can assure noble Lords that we are still considering possible ways of developing this idea in an affordable form.
§ Lord Stoddart of Swindon
My Lords, the noble Lord said that the cost of equalising the retirement age (which I take it would be at 60) would be exorbitant and he mentioned a figure of £3,000 million which seems a very high figure. Perhaps he would look at this, because while I was in the other place I was given an answer to a question which I asked on this subject which told me then—I believe in 1982—that the net cost, after taking into account people who are unemployed and so on, would be £250 million for each year 1that the retirement age for men was reduced. I make that figure to be £1,250 million, which is quite different from the £3,000 million which the noble Lord mentioned. I do not expect him to answer that at this moment. But can he take on board and perhaps investigate, write to me and put the reply in the Library?
§ Lord Young of Graffham
My Lords, I am grateful to the noble Lord for his intervention. I shall look at the figures. It is a matter outside my immediate responsibility but I shall look at it. I hope that I may be in a position to write to him or request my right honourable friend to do so. Let me say in passing that this is a matter which should not be taken lightly. I speak from memory but I believe that at the moment there is one retired person for every 2.3 working people in the United Kingdom and that in the first decade of the next century the figure will he one retired person to every 1.8 working people. We must be careful when we see other economies in the world, such as the United States of America, where the tendency is towards late retirement as people wish to 970 work later and contribute more to the economy. I think that to go down the path of actively encouraging earlier retirement for all imposes a financial burden on the community which we should all consider.
It is for this reason among many others, that the Government are determined to look at all the consequences of this matter and see all the implications of it. It will set a pattern not only for ourselves (since by that time I hope to be well and truly covered by this matter) but also for those who will follow after us. Many points have been raised on this subject, but I fear I can add little to what has been said. That is as far as I can take the matter.
§ [Amendments Nos. 1B to lE not moved.]
§ On Question, Commons Amendment No. 1 agreed to.
§ 7.15 p.m.