§ Mr. Greville Janner
asked the Secretary of State for Employment by how much the value of the maximum award of £5,200 for employees unfairly dismissed has been reduced since this limit was fixed, due to the fall in the value of money; and whether he will now increase this maximum, so as to take into account that fall.
§ Mr. Booth
It is estimated that between September 1974 when the limit of £5,200 was fixed and February 1976, which is the latest date for which information is available, the internal purchasing power of the pound fell by 26 per cent., so that £5,200 in September 1974 would be worth £3,848 in money terms in February 1976.
From 1st June next, the maximum of £5,200 will apply to the compensatory award for unfair dismissal. In addition, from the same date a new award, to be known as the basic award, will be introduced with a maximum of £2,400. Thus the new overall maximum will be £7,600.
Whilst this matter is reviewed periodically it is not at present my intention to increase the maximum of £5,200.