Northern Ireland Assembly
Leslie Cree (UUP)
I welcome the opportunity to speak on important legislation that has ramifications for a significant number of people in Northern Ireland. The Finance Committee has received briefings on a number of occasions on the Superannuation Bill. In effect, the Committee has been in limbo, as the corresponding legislation that was introduced in Westminster had been subject to legal proceedings, to which our Chairman has referred. I thank the officials for keeping us apprised of the situation up to this point.
I first want to deal with the legal challenge in GB. It was brought by the Public and Commercial Services Union and the Prison Officers’ Association against the changes to the Home Civil Service compensation scheme introduced as a result of the Superannuation Act 2010 at Westminster. However, the legal challenge was unsuccessful, and that has left the way open to move forward with the Superannuation Bill that is before us today, and subsequently to amend the Civil Service compensation scheme in Northern Ireland. The effect will be to bring Northern Ireland into line with what has happened in the rest of GB.
As I said at the outset, the legislation will have ramifications for a number of people in Northern Ireland. Statistics from the Department show that the Civil Service scheme, at 31 March 2011, had just over 34,000 active members and that last year, the scheme paid out more than £232 million in pensions and lump sums. Therefore, due to the sheer volume of people that the Bill affects, we approach it with sensitivity and a good deal of sympathy.
To deal with the issue in its broadest sense, the compensation scheme determines the amount of compensation and early pension benefits to be paid to staff who face voluntary or compulsory redundancy.
The key changes to the scheme include that staff leaving on voluntary redundancy will — I will say this for Mr Girvan’s information — receive a maximum of 21 months’ salary and those leaving through compulsory redundancy will receive a maximum of 12 months’ salary. I believe that, under the current system, members are entitled to a maximum of three years’ pay.
Moving on, I will look specifically at the Bill’s proposals. It is a short Bill, and, as the Minister said, it contains two main clauses. Clause 1 will remove the requirement to obtain consent from the Civil Service trade unions for reductions in benefits. However, that needs to be looked at alongside clause 2, which will augment the requirement on DFP to carry out consultation with a view to reaching agreement on any reduction of a compensation benefit. Clause 2 will also introduce a requirement for DFP to produce a report on such consultations. That report must be laid before the Assembly.
Overall, I believe that clause 2 means that trade unions’ views will be adequately taken into account, despite their consent not being needed. It is also clear that the Assembly can perform an important scrutiny role of any changes through consideration of the DFP report. At this stage, I am satisfied with the Bill’s general principles.
The issue that lies at the heart of the debate has been rehearsed in the House many times, and that is the issue of parity. The Minister and his officials from the Department of Finance and Personnel have made the decision that now is the time to introduce legislation to ensure that parity is maintained in that area. The Ulster Unionist Party supports that decision. There is little point in going over the detrimental effects that a divergence from parity with the rest of the United Kingdom would have on Northern Ireland. During the debate on welfare reform, we heard, and will continue to hear, of the financial consequences of doing that. Suffice it to say, however, it is an important avenue that we should not, and will not, go down. The Ulster Unionist position is clear on that.
It must be noted that the Executive agreed a paper on 7 July 2011 that outlined that the Superannuation (Northern Ireland) Order 1972 needed to be amended. The paper also agreed to remove the need for union consent and to introduce detrimental changes to the current terms of the Civil Service compensation scheme (Northern Ireland). It also agreed to introduce requirements for DFP to report on its consultation with unions with the aim of reaching agreement on any such changes. Therefore, it is important to remember that, as it moves through the legislative process, the Bill has received the Executive’s backing.