Mr Philip Hammond (Runnymede & Weybridge, Conservative)

I beg to move amendment No. 120, in

clause 33, page 16, line 8, leave out from 'conviction' to 'to' in line 9.

Mr Edward O'Hara (Knowsley South, Labour)

With this it will be convenient to discuss amendment No. 121, in

clause 33, page 16, line 12, leave out subsection (6)(a)(ii).

Mr Philip Hammond (Runnymede & Weybridge, Conservative)

We have moved on from the lengthy subsection (2) to subsection (6). This modest pair of amendments seeks to probe the Under-Secretary for an explanation as to why a different regime of imprisonment on summary conviction is provided for in England and Wales as opposed to Scotland. That is, of course, not a devolved matter, so it seems inappropriate that the penalty for a United Kingdom offence should be different depending on which constituent country of the UK the offender lives in. It is not at all clear why people residing in England and Wales should, on summary conviction, be subject to a prison term four times longer than that for someone residing in Scotland. The amendment would standardise the treatment of offenders in England and Wales with that in Scotland. I await with interest the Under-Secretary's explanation of the discrepancy in the Bill.

Mr Phil Hope (Parliamentary Under-Secretary, Office of the Deputy Prime Minister; Corby, Labour/Co-operative)

The amendments are misleading because we are dealing with separate criminal jurisdictions. As a result of the commencement of section 154(1) of the Criminal Justice Act 2003, to which subsection (8) refers, the penalties on summary conviction will differ. Sentencing is a matter for the Scottish Executive, and they are awaiting the outcome of the McInnes report, a review of summary justice, before considering any changes to the existing policy. That, I hope, makes it clear that the systems are different and it will be for the Scottish Executive to change their sentencing policy if they wish to match the one that is being changed in the Bill. I hope that with that explanation the hon. Gentleman will withdraw his amendment. If not, I am happy to try to deal with any other queries that he has.

Mr Philip Hammond (Runnymede & Weybridge, Conservative)

I find it deeply troubling that that aspect of devolution means that, where matters are reserved as UK matters, and a single regime applies across the UK, there will not be a single, comparable

set of outcomes. We are not talking about a nuance; a sentence could be four times greater in England than in Scotland. There is the potential for heightening still further the sense of injustice felt by many English people about the beneficial regime that Scotland appears to enjoy.

Mr Phil Hope (Parliamentary Under-Secretary, Office of the Deputy Prime Minister; Corby, Labour/Co-operative)

The White Paper, the review of the criminal courts of England and Wales, and the report by John Halliday, ''Making Punishments Work: Review of the Sentencing Framework for England and Wales'', arrived at the conclusion that that should be the punishment for those offences in England and Wales. I emphasise that, because of the different criminal jurisdictions, it is a matter for the Scottish Executive. The equivalent to the Halliday report, which informed the England and Wales divisions, is the McInnes report. It is for the Scottish Executive to decide, in light of that report, whether they wish to continue the different system.

Mr Philip Hammond (Runnymede & Weybridge, Conservative)

I am grateful to the Under-Secretary. I suppose that there is a glimmer of hope in that it is possible that sentencing regimes may be brought into line in future. What I have not heard is an acknowledgement from him that the situation, if it were to continue, would be unacceptable. Will the review that is going on in Scotland require primary legislation to amend the provision in subsection (6)(a)(ii)? If, as he suggests, there may be a change in the sentencing regime, that would presumably require primary legislation. [Interruption.] The Under-Secretary is indicating dissent, as they say in Hansard, from a sedentary position, but it is not clear to me how we would deal with the provision that contains the phrase,

''in Scotland, to imprisonment for a term not exceeding 3 months'',

if the review going on in Scotland determined that there should be a longer sentence.

The principle involved is quite important. Of course, when matters are devolved, there will be different regimes. There will not necessarily be any symmetry in what happens in England and what happens in Scotland, which gives rise to problems of its own. However, when a matter is reserved and this Parliament determines the regime for the whole of the UK, it is wholly unacceptable that sentencing that relates to an outcome of that regime should be a devolved matter. The potential is there for the devolved authority in Scotland entirely to undermine the intention behind the UK policy by decreeing a nugatory sentence for an offence that this Parliament intends to result in a substantial punishment in England and Wales—perhaps up to 12 months in this case.

Obviously, if we are simply stuck with a timing discrepancy, and the Scottish sentencing regime is to be brought into line, that will resolve the problem. However, a potentially serious, and broad, issue has been highlighted. It goes a long way outside my brief on local government, and I will want to consult with

my colleagues. I will not press the amendment to a Division, but I will want to discuss the wider implications of the matter.

Mr Phil Hope (Parliamentary Under-Secretary, Office of the Deputy Prime Minister; Corby, Labour/Co-operative)

I cannot speak for the Scottish Parliament. However, I want to emphasise that it is a matter for the Scottish Parliament if it wishes to increase sentences. It has the powers to do so, even though this is a reserved matter, as the hon. Gentleman pointed out. It is for the Scottish Parliament to decide: that is the nature of devolution. The hon. Gentleman may have wider concerns about that, beyond those of the Bill and the clause, but I want to emphasise that that is the situation.

Mr Philip Hammond (Runnymede & Weybridge, Conservative)

I understand the situation and I may indeed have wider concerns, but they are not relevant to this debate. The relevant point is that the clause has drawn my attention to the fact that the Scottish Parliament can, if it wishes, entirely undermine the intention of the UK Parliament in respect of a matter that is incontrovertibly reserved, given that it has control of sentencing for offences committed even in relation to reserved matters.

On a much wider canvas, sentencing for serious offences relating to significant matters of reserved policy could be entirely undermined if the Scottish Executive were able, for example, to decree a maximum five-day sentence for an offence that in England and Wales carried a maximum five-year sentence—I use an extreme example. The effect of that would be to apply nominally the same body of law in England and in Scotland, but in practical terms to create a situation in which the offence was not punished in Scotland. Surely that is a perverse outcome of the process of devolution. As I said, the issue goes much wider than the narrow confines of the Bill. I am grateful to the draftsman for drawing my attention to something that strikes me as very serious indeed. I hope to return to the issue in another forum, but I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Mr Richard Younger-Ross (Shadow Minister, Office of the Deputy Prime Minister Local Government & the Regions; Teignbridge, Liberal Democrat)

I beg to move amendment No. 181, in

clause 33, page 16, line 28, at end add—

'(10) The Secretary of State shall provide a separate flexible pension scheme for firefighters employed on the retained duty system within six months of the enactment of this Bill.

(11) The retirement age of firefighters will be determined by their willingness and fitness to serve beyond the age of 55.'.

I have received a document, which I had not seen before, on part 4, ''Employment'', which goes some way towards answering the questions that lie behind our amendment.

Mr Philip Hammond (Runnymede & Weybridge, Conservative)

Will the hon. Gentleman give way?

Mr Richard Younger-Ross (Shadow Minister, Office of the Deputy Prime Minister Local Government & the Regions; Teignbridge, Liberal Democrat)

I have barely started but I will give way.

Mr Philip Hammond (Runnymede & Weybridge, Conservative)

The hon. Gentleman referred to a document, but I missed the title. Would he give it again? Has the document been circulated to the Committee?

Mr Richard Younger-Ross (Shadow Minister, Office of the Deputy Prime Minister Local Government & the Regions; Teignbridge, Liberal Democrat)

For the record, I am referring to the note on regulation-making powers in part 4 of the Bill.

I was seeking to have the Under-Secretary state whether retained fire crews will be entitled to a pension scheme such as that in part 4. Will he expand briefly on that? I also wanted him to explain further the Government's thinking about retirement age. At present, the cut-off is 55. A point put to me by several retained and full-time firefighters is that the rule is nonsense. There should be no reason why someone who is fit and willing cannot continue beyond that age if they wish. With a clear statement from the Under-Secretary, we may be able to move on swiftly.

Mr Philip Hammond (Runnymede & Weybridge, Conservative)

I would briefly like to record my party's support for retained firefighters and our recognition of the need substantially to improve their recruitment and retention. The Under-Secretary will probably agree that, if anything could undermine the modernisation process, it would be an inability to recruit and retain the required number of retained firefighters for the service that is envisaged. Addressing the pensions issue may be only one part of the answer to that problem.

I know that the hon. Member for Teignbridge (Richard Younger-Ross) represents an area where the fire service is almost entirely made up of retained personnel, but I am not entirely certain that their interest would be best served by a separate pension scheme. I would be grateful if the Under-Secretary could confirm my understanding that the Government are committed to making proper pension arrangements for retained firefighters.

Mr Richard Younger-Ross (Shadow Minister, Office of the Deputy Prime Minister Local Government & the Regions; Teignbridge, Liberal Democrat)

The amendment does not say that there should be a separate scheme; it says that there should be a flexible one. I accept the hon. Gentleman's point that the arrangements could come under an existing scheme.

Mr Philip Hammond (Runnymede & Weybridge, Conservative)

With the greatest respect to the hon. Gentleman, the amendment states that the Secretary of State

''shall provide a separate flexible pension scheme for firefighters employed on the retained duty system'',

which implies that it could not be part of one of the core schemes provided.

On proposed new subsection (11), the hon. Gentleman is, frankly, barking up the wrong tree. His proposal simply is not an option. As he rightly pointed out, it is absurd for people to retire at 55 if they are fit and able to serve, but his amendment would give them the option of retirement at 55, as it refers to their willingness to serve beyond the age of 55. Of course, people are entitled to retire whenever they wish, but the implication in the amendment is that they would be entitled to a pension at 55.

At the risk of being thought unsympathetic, I do not believe that retirement at 55 is an option in this day and age. Firefighting is hazardous, but it is no more hazardous than many other occupations. I do not have the most up-to-date figures—perhaps the Under-Secretary has them to hand—but I believe that it is the 11th or 12th most hazardous occupation in terms of the number of injuries and deaths per thousand man-days, and that construction and agriculture are far more dangerous, yet no one has suggested that people in those sectors should have a right to retire at 55 on a full pension. That seems a throw-back to a bygone era and inappropriate for the 21st century.

As I understand it, and the Under-Secretary may clarify this, retaining a right to retire at 55, regardless of health considerations, would fall foul of the Government's wider proposals for pensions reform and would almost certainly render any such scheme ineffective from a tax point of view. I understand the intention to be that schemes that will benefit from the tax-advantageous status enjoyed by pension schemes would have to drop entitlement to a pension at 55.

Although we are happy to support the principle of encouraging and supporting retained firefighters, we do not believe that the amendment would be helpful in achieving that. There are better methods, and I hope that the Under-Secretary will confirm that the Government are committed to those.

Mr Phil Hope (Parliamentary Under-Secretary, Office of the Deputy Prime Minister; Corby, Labour/Co-operative)

Amendment No. 181 has two purposes. The first would require the

Secretary of State to provide a pension scheme for retained firefighters within six months of enactment of the Bill. I think that we agree that retained firefighters should have access to a pension scheme in the same way as other employees of a fire and rescue authority. Retained firefighters have been excluded from the current arrangements, although they benefit from the ill-health and injury provisions if they are injured while carrying out firefighting duties. I want to place on record how much we value their contribution and commitment to the service. On my recent visits to Northamptonshire, Cheshire, Cornwall and the west midlands I was extremely impressed by their professionalism and commitment.

Mr Richard Younger-Ross (Shadow Minister, Office of the Deputy Prime Minister Local Government & the Regions; Teignbridge, Liberal Democrat)

The hon. Gentleman could come to Devon.

Mr Phil Hope (Parliamentary Under-Secretary, Office of the Deputy Prime Minister; Corby, Labour/Co-operative)

Yes, I hope to be able to get to Devon at some point to meet retained firefighters in the hon. Gentleman's constituency and representatives of the local authority.

We believe that all persons engaged in firefighting and other emergency work should be entitled to membership of a suitable pension scheme and to the same benefits. We shall therefore seek to ensure that retained firefighters are members of the same pension scheme as other firefighters.

Mr Philip Hammond (Runnymede & Weybridge, Conservative)

The Under-Secretary referred to people ''engaged in firefighting and other emergency work''. Under the present scheme firefighters are distinguished as a group. Does he envisage that in

future others who are not firefighters as such would be in the same scheme as firefighters because they were engaged in emergency work?

Mr Phil Hope (Parliamentary Under-Secretary, Office of the Deputy Prime Minister; Corby, Labour/Co-operative)

The hon. Gentleman may have misheard me. I was referring to the fact that, as we know from the Bill, firefighters also play a role in road traffic accidents and other emergencies. Therefore, ''firefighting and other emergency work'' implies what we have been discussing in the Committee for the last fortnight. Those persons should be entitled to membership of a suitable pension scheme. We indicated that in the note on the regulation-making powers in clauses 33 and 35, to which the hon. Member for Teignbridge referred.

We hope, in June, to publish for consultation our proposals for the new pension arrangements for firefighters, and we expect them to cover retained firefighters. Subject to the outcome of the consultation, we expect the new pension scheme to be operational from 1 April 2005. That is the time scale for delivering the outcomes sought by the amendment, which I hope the hon. Gentleman will now accept is unnecessary.

The second purpose of the amendment is to provide for the retirement age of firefighters to be determined by their willingness and fitness to serve beyond the age of 55. We recognise that the current arrangements, which set a compulsory retirement age of 55 for those other than senior officers in the service, are no longer acceptable. That point was made by the hon. Member for Runnymede and Weybridge (Mr. Hammond). The service needs to retain experienced staff who can contribute to meeting the demands that we are placing on it. Accordingly, we do not intend to specify a compulsory retirement age. Instead, any pension scheme will provide for pensionable age, so that a person who satisfies the fitness requirements for the role in which they are employed and who is willing to continue in service can do so.

In our note on the regulation-making powers, we make it clear that the new pension and tax regime, as the hon. Gentleman implied, would not allow firefighters to continue to draw pensions from the age of 50. It also made it clear that we are considering setting a normal pension age of 60, but allowing earlier payment, possibly actuarially reduced, from the age of 55. We are funding research into fitness standards so that fire and rescue authorities have evidence-based guidance on which to make decisions about an individual's fitness to continue in service.

I hope that with that clarification of how the new scheme will work and the details about retirement age the hon. Member for Teignbridge will withdraw his amendment.

Mr Richard Younger-Ross (Shadow Minister, Office of the Deputy Prime Minister Local Government & the Regions; Teignbridge, Liberal Democrat)

I thank the Under-Secretary for a full and helpful response to our probing amendment. I take on board exactly what he said about moving the retirement age from 55 to 60. We did not include that in our amendment because we were

uncertain about whether to move from 60 or beyond 60 for the compulsory age. The consultations are considering 60, and we support that in principle.

To clarify my intervention on the hon. Member for Runnymede and Weybridge, I should point out that I was trying to refer to the document, rather than to my amendment. The document refers to one scheme; I accept that my amendment refers to a separate scheme. We accept the principle outlined in part 4 on employment, and I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Question proposed, That the clause, as amended, stand part of the Bill.

Mr Philip Hammond (Runnymede & Weybridge, Conservative)

Before we move on, we should say something else about pensions, because it is a big issue for the service. My information is that pension costs are about 35 per cent. of total wage costs throughout the service, and that in some of the large metropolitan fire and rescue authorities, 25 per cent. of the revenue budget is consumed by meeting pension obligations. Will the Under-Secretary confirm those figures?

In the White Paper, the Government said that they would address the pension issue, which is an albatross hanging around the necks of fire and rescue authorities. However, the Bill gives us precious little idea about how they will tackle the problem. To a large extent, the note that the Under-Secretary helpfully circulated, and to which the hon. Member for Teignbridge referred earlier, keeps all options open. From my interpretation of it and the enabling provision, it appears that there will be more than one scheme and that colleagues who work side by side, perhaps one being a firefighter who has ceased operational duties and moved to a non-operational role, may be in different pension schemes with different arrangements. That could cause some difficulties.

I understand that there is likely to be a new scheme, possibly funded, for new entrants, while something along the lines of the current scheme would continue for existing members of the fire service pension fund. Will the Under-Secretary confirm my interpretation that there is provision for the establishment of a funded scheme? I know that there is no requirement for it, but the Bill provides the power to establish a funded scheme if the Government decide to do so.

Will the Under-Secretary also provide some comparative examples of the burden of pension costs in the fire and rescue service compared with other public services, such as the military and the police? Will he explain why the burden is higher in the fire and rescue service than any other public service?

Mr David Drew (Stroud, Labour/Co-operative)

Firefighters always tell me that the simple reason why the burden is higher is that there is a great deal of loyalty to the service. In the fire service, unlike even the police, the tradition is that people serve their time, so, with an ageing work force, there will inevitably be a knock-on effect on pensions.

Mr Philip Hammond (Runnymede & Weybridge, Conservative)

I am not sure that the hon. Gentleman draws a logical conclusion. One would normally expect the pension burden, if one can call it that, to be proportional to the size and cost of the work force; turnover will not necessarily determine it.

I understand that, under the present system, pension accruals step up after a certain number of years' service, which makes it very disadvantageous for people to leave the service. The Under-Secretary will be able to confirm whether that is correct. If it is, it would explain to some extent the loyalty that causes people to stay in the service for a long time: there is an artificial incentive to stay on for 20 years. I understand that the Government are minded to remove that in the interests of a more open and flexible service, and so as not to disadvantage those who come into the service later in life—something that we all seek to encourage to give the fire service a more diverse experience base. I hope that the hon. Gentleman will be able to explain all those points in more detail.

Finally, I want to ask the Under-Secretary about the time scale for some more illuminating proposals. He will know from his discussions with fire and rescue authorities that, alongside the modernisation agenda, which places on them a substantial burden of management initiatives, managing and funding pensions is a constant cause of concern. The White Paper indicated that the Government would address that problem, but clearly that is not done in the documents before the Committee, which simply set out some of the parameters that we are already aware of. When does the Under-Secretary expect more concrete proposals about the future shape of pension arrangements in the service to be published, or at least set out in initial form for consultation?

Mr Richard Younger-Ross (Shadow Minister, Office of the Deputy Prime Minister Local Government & the Regions; Teignbridge, Liberal Democrat)

I thank the Under-Secretary for his response on Thursday when he said that the problem of revenue funding for pensions will be resolved and that he is considering bringing in a scheme to deal with it fairly promptly. I hope that he will confirm that. If he can give us a timetable for such a review and say whether it would come into play for the next financial year, that would be beneficial for fire authorities.

A new scheme can occasionally create anomalies between those on the new scheme and those on the old. I can give a brief example. When the police pension scheme was changed in, I think, 1978, extra rights were given to the partners of officers who had retired and then died. If the officer had not remarried, the wife could get a pension. If the officer retired after 1978 and had remarried, the new wife would get a pension, but if the officer had retired before 1978, she would not. That has created much concern among some officers. I am anxious that we do not end up with the same anomaly for firefighters and that in 20 years' time firefighters are not coming to Members of Parliament, saying, ''It's a very small issue, but it's not fair; my wife now can't get a pension.''

Mr Phil Hope (Parliamentary Under-Secretary, Office of the Deputy Prime Minister; Corby, Labour/Co-operative)

Clause 33 re-enacts existing powers in section 26 of the Fire Services Act 1947 which allow the Secretary of State to bring pension schemes into operation for persons

''employed by a fire and rescue authority or by a Scottish fire authority''.

As I have said, we refer to schemes in the plural so that there is no doubt that, as well as bringing in the new pension arrangements that we believe necessary for the new fire and rescue service we can, for example, have a separate scheme for death and injury benefits. I have covered some of this territory in speaking to earlier amendments, so I will try to focus on the particular concerns that Members have raised.

On the time scale, we aim to publish our proposals for change in June 2004 with a view, following public consultation, to introducing new schemes on 1 April 2005. It is not possible for me to make a commitment on funding, but I pick up the point about the funded scheme. Subsection (2)(e), which we have just discussed, allows us to create a fund if we wish, and we are still consulting on that.

On the wider context, firefighters' pensions are paid from revenue, and fire and rescue authorities treat firefighters' pension contributions as revenue. The figures cited by the hon. Member for Runnymede and Weybridge are correct. Pensions constitute 30-35 per cent. of pay and 25 per cent. of revenue. Central Government revenue support grant reflects year-on-year increases in firefighters' pension costs, but that is, of course, based on average costs across the country rather than the spend of an authority. I made that point to the hon. Member for Teignbridge in the debate on the amendment.

Fire and rescue authorities and police authorities have similar problems with the lumpiness of payments for retiring firefighters. I cannot give the hon. Member for Runnymede and Weybridge detailed figures of the police and military pension schemes, but the police certainly experience similar problems on occasion. We considered the issue in 2001, and various solutions were identified, particularly in the context of the modernisation programme. As a consequence, we are providing for an extension of the matters that may be included in any scheme to cover the provision of employer contributions and the payment of contributions into a fund. I confirm that that is not a decision but a proposal out for consultation. It is covered by subsection (2)(e), and it will mean that we can make different arrangements for financing and funding pensions if that appears, following consultation, to be the best practical solution to the problems that confront authorities in financing their pension schemes.

I do not have in front of me the details on the anomalies in the existing scheme. I say to the hon. Member for Teignbridge that, obviously, in consulting on the new scheme we will endeavour to consider all the anomalies that have been brought to our attention concerning previous schemes to consider whether they can be addressed. I cannot give him a yes or no answer on that point, because it is a matter that we will consider in June when the paper is out for

consultation. If at that stage he feels that we have not covered his point well enough, despite his raising it here in Committee, he can make a contribution to the consultation process.

Mr David Drew (Stroud, Labour/Co-operative)

What the hon. Member for Teignbridge said is correct, and I totally agree with him. I have known a couple of occasions where the widow of a firefighter wished to get married again, in one case to another firefighter, and it was financially punitive to do so. We need to consider that. That disadvantage seemed to be unique to the fire service.

Mr Phil Hope (Parliamentary Under-Secretary, Office of the Deputy Prime Minister; Corby, Labour/Co-operative)

I am grateful to my hon. Friend. As I say, we will endeavour to see what the issues and anomalies are in the current scheme so that we do not create undesirable anomalies in future schemes.

The clause also deals with matters to do with invoking, varying or revoking a scheme, with issues of consultation and with issues of persons committing offences. We have covered those in debates on amendments. I hope that, given those remarks, hon. Members will agree that the clause should stand part of the Bill.

Question put and agreed to.

Clause 33, as amended, ordered to stand part of the Bill.