Armed Forces Pension Review (Hansard, 7 December 1999)

§ The Minister of State, Ministry of Defence (Baroness Symons of Vernham Dean)
My Lords, the review of the Armed Forces pension scheme announced in September 1998 is under way. A review of this magnitude, which considers wide-ranging and complex issues affecting a wide range of groups, necessarily takes time. It is expected that the review will report next summer.

§ Baroness Strange
My Lords, I thank the Minister for her sympathetic, if familiar, reply. I am sure that she is aware that I am speaking about the Act relating to attributable Armed Forces family pensions, with particular reference to the retention of pensions on the remarriage of post-1973 war widows. However, is she aware that yesterday was the Feast of St. Nicholas, 1151 who is renowned for filling the stockings of young ladies unable to get married because they do not have a dowry? Would it not be seasonably jolly if the MoD were also to play Santa Claus?

§ Baroness Symons of Vernham Dean
My Lords, I am very glad that my response is a familiar one; I hope that that at least has the merit of consistency. We shall carry forward this review as quickly as possible. It is a complex issue and needs a considerable amount of work. In a seasonable spirit, I say to the noble Baroness that I believe that there are two reviews which are of interest to those concerned. The noble Baroness is, of course, particularly concerned about war widows. The first is the Joint Compensation Review, which looks at paying compensation to members of the Armed Forces for death, injury or illness which arises as a result of their military service. That compensation review is due to report early next year and we hope to have proposals for public consultation early in the year 2000.
The second review relates to the Armed Forces pension scheme. That is a comprehensive review which will take into account the question which I know is of particular concern to the noble Baroness; that is, that relating to life-long pensions for widows—pensions which are not withdrawn on remarriage. Therefore, there are two reviews which I hope will be of interest to her.

§ Lord Craig of Radley
My Lords, can the noble Baroness confirm that the present pay and issue of service personnel are abated by a percentage to pay for their Armed Forces pension? I believe that that abatement is around 7 per cent. Can she assure the House that a basic assumption has been made in the review that that percentage will not be increased?

§ Baroness Symons of Vernham Dean
My Lords, I do not want to prejudice the outcome of the review next year but, of course, the noble and gallant Lord is quite right. There is an abatement of salary of members of the Armed Forces to pay for their pension. In that respect, it is similar to the Civil Service pension scheme and, indeed, to a number of other public service pensions. The abatement reflects the view of the Armed Forces Pay Review Body about what is a sensible level of abatement for Armed Forces pensions. While it is of interest to those undertaking the review, I am sure that that matter will remain also of very great interest to the body itself.

§ The Countess of Mar
My Lords, is the review intended to clear up the anomaly which has arisen over attributable benefits for about 600 TA and reservists who fought in the Gulf War?

§ Baroness Symons of Vernham Dean
My Lords, I hope that the review of the Armed Forces pension scheme—not the review about compensation but the second review about which I spoke a moment or two ago—will deal with the question raised by the noble Countess. If there is any reason for me to revise that 1152 answer, I shall make sure that I write to her as quickly as possible. However, it is my understanding that that is indeed the case.

§ Lord Burnham
My Lords, perhaps I may ask the Minister whether the reply which she gave to the noble Baroness, Lady Strange, about timing with regard to the pension review will apply also to the plans for the revision of the methods of pay for the Armed Forces as a whole. If that is not completed at that time, will there be any disadvantage to the Armed Forces in that they will not receive appropriate pay increases?

§ Baroness Symons of Vernham Dean
My Lords, in answer to a recent Written Question, I informed Members of your Lordships' House that the adjustments to be made to the pay of the Armed Forces will now take place in the year 2001. I shall write with further details because the explanation is rather lengthy. The noble Lord could look it up in Hansard, but I shall be very happy to write to him giving proper details of what that involves. However, it is deferred until 2001.

§ Lord Mackie of Benshie
My Lords, can the noble Baroness tell us whether the review will deal sympathetically with the differential between Gurkha pensioners and those pensioners who belong to Great Britain? Will she tell us something about progress in that sphere?

§ Baroness Symons of Vernham Dean
My Lords, I believe that the noble Lord will find that the differential to which he refers has in fact been rectified. An announcement was made about three or four weeks ago, but I shall write to the noble Lord with the details.