Colonial Service Officers (Pensions)

Defence (Army) Estimates, 1965–66 – in the House of Commons at 12:00 am on 8th March 1965.

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Motion made, and Question proposed, That this House do now adjourn.—[Mrs. Harriet Slater.]

11.59 p.m.

Photo of Hon. Nicholas Ridley Hon. Nicholas Ridley , Cirencester and Tewkesbury

I am grateful for the chance to raise this evening the question of the responsibility of the Government for the pensions of those former members of the Colonial Service, or the Overseas Service as it is now called, who have served in former territories, colonial and otherwise, throughout the world, and who are now on pension as a result of their service.

It has been the policy of successive Governments, of every colour, to safeguard the pensions of those people, when the territories in which they serve receive independence, by means of public officers' agreements, and in each case the responsibility has been placed on the territory itself to pay the pension of its former servant wherever he may move to, and wherever he may reside.

There have, perhaps understandably the House may think, been several cases of default where foreign countries have found that they are unable or unwilling to carry the cost of these pensions. Somalia, Zanzibar, and later, with regard to tax provisions, Ghana, have caused great trouble among former servants of those territories who are now drawing pensions from them. In each case the British Government have rescued the pensioners to the best of their ability by taking whatever action was possible to make sure that the money started to flow again, and to sort out the tax difficulty, as in the case of Ghana, but inevitably this situation causes the pensioners considerable apprehension and worry about the future.

If there is default, it causes delay before the pensioners can catch up again. Or, if they are due a supplement which they do not receive, this delay can, in many cases, be a severe financial hardship to them. In many cases, there is a direct loss due to the tax factor in the case of Ghana which I mentioned a few moments ago.

The situation has now been more or less righted, except for a very small minority of the pensioners who pay so little tax in this country that they are not able to recover or to set off against that which they have paid in Ghana, and are therefore worse off over the whole operation. But I think that the main worry in the minds of these pensioners is the general insecurity about the future, and the feeling that at any time something may go wrong and their old age may be even more difficult than it is.

It is for those reasons that the pensioners have continuously put pressure on hon. Members on both sides of the House to persuade Her Majesty's Government to take over responsibility for paying these pensions, and before the last election the pensioners, through their association, went to the three political parties—Conservative, Labour and Liberal—and asked them, quite straight forwardly and frankly, what would be their policy if they won the election. I shall return later to the points of substance, but I should like just to follow up what happened from that time onwards.

Each of the three parties was written to, and I think that in each case an interview was granted. The pensioners' association received letters from each of the parties. These letters were subsequently printed and circulated to all the members of the Overseas Service Pensioners' Association. There are 20,000 members of this association, so a large number of people were supplied with the answers to the questionnaires which the association put to the three main parties.

In my constituency this is a very live and real issue, and I expect that it is in many others, too. Considerable numbers of people who are affected feel very strongly about the whole matter. I was asked many questions during the election, as to what my policy would be. Whatever one may think of this sort of pressure group tactics, it is something which all hon. Members get from many sources during elections, and all candidates and Members must be used to it. It is part of our normal duties to manage these things as best we can.

I want to read out the relevant paragraphs of the answers of the three main parties to this questionnaire. The Conservative Party sent a letter through my right hon. Friend the Member for Mitcham (Mr. R. Carr) saying: As I told you at our meeting, while Her Majesty's Government has consistently held to the view that overseas Governments must continue to be responsible for the payment of the pensions of officers they had employed, it has also undertaken to safeguard these payments through the conclusion of Public Officers' Agreements with the countries concerned. The reply of the Liberal Party was made by a Mr. Grierson, secretary to the Liberal Parliamentary Party, and said: The Liberal Party agree that the best solution would be for the British Government to accept responsibility for the payment of pensions to ex-officers and their widows from the date when the Colonial Territories achieved independence. They quite straightforwardly granted that the case was a good one, and promised to implement it if they were returned to power.

The reply from the Labour Party said: The Research Department have informed me that the Labour Party would support any representation made should any overseas Government default as has already happened in the case of Somalia and Zanzibar. It was not thought wise to commit any Government to an outright declaration that Her Majesty's Government would take over pensions automatically. The following letter, however, which was received by our Chairman from Mr. Douglas Houghton after the interview which we had with the members of the Parliamentary Labour Party on the memoranda which were published in the last News Letter, is of interest. I have Mr. Houghton's permission to repeat it in toto:'… I was sorry there were not more of my friends to meet you, though quite frankly, our minds are pretty well made up in favour of your proposals. I think that what you wish will be brought about in the next Parliament whichever Party is returned'. Wherever I went, the words I have just read out as being the words of the Labour Party were quoted at me. I found myself at a considerable disadvantage in having to tell pensioners that I did not accept that this policy should be carried out. I was told that my opponent was certainly promising that this would happen. I agree that this was not exactly a pledge—certainly not an official one of the party —but it created the impression in the minds of all pensioners that they were going to have their request met if the Labour Party were elected. There is no doubt that it clearly led them to expect that this action would be taken.

I was, therefore, extremely surprised and rather worried when, in answer to a Question to the right hon. Lady the Minister, on 15th December, she said: The Government will continue to look to overseas Governments to pay the pensions of their former officers and will continue also to safeguard the position of the pensioners."—[OFFICIAL REPORT, 15th December, 1965: Vol. 704, c. 185.] The Government have not implemented that policy although, in the words of the Chancellor of the Duchy of Lancaster, our minds are pretty well made up infavour of it. It is a most unfortunate thing that these carefully worded suggestions should be made at the time of the election, especially if they were not to be followed up by action when the party succeeded in achieving power.

It seems to me that this is getting perilously near to a breach of faith, and I hope that the hon. Member will give an explanation and will tell us whether an apology is to be forthcoming to the pensioners and why it was not denied, when this circular was brought out during the election, that the Labour Party had no intention of doing any such thing. It has caused considerable unhappiness among these people, and some of us who took the contrary view during the election feel that we suffered in vain the criticisms of the electorate in relation to these proposals.

What is so ironic about this is that my right hon. Friend the Member for Mitcham, when he was Secretary for Technical Co-operation, went a little further than the position which the right hon. Lady outlined. He said that if it so happened in relation to the payments of a pension that a pensioner found himself in financial difficulties, Her Majesty's Government should feel obliged to take appropriate remedial action. This seems to me to go further than the present Minister because it directs attention to the individual, and if any individual pensioner finds that he is in a worse position or is suffering hardship as a result of some default or alteration of agreement by a foreign country, the Government were pledged to undertake to put that individual's financial position right. That seems to me stronger than simply accepting that where a country defaults one would do one's utmost to get it to honour its obligations and in the last resort, perhaps, help.

Going back to the example of Ghana, although Her Majesty's Government at that time persuaded Ghana to make an agreement which was sensible as to 90 per cent. of the pensioners, it left 10 per cent. of them out. They had to pay tax in Ghana simply because they were not well enough off to become Income Tax payers in this country.

I have explained the position adopted by my right hon. Friend before the election, and I shall be glad to hear from the Parliamentary Secretary whether the present Government would go as far as that. Will they guarantee to help any pensioner who finds himself in financial difficulties as a result of the action of a foreign Government? I have several cases which seem to me to be deserving of urgent action if the Government would go as far as I have just suggested. I have one in particular about which shall put a Parliamentary Question to the hon. Member the next time his Department is reached. I will send him details in advance to see whether there is anything he can do to correct this, because here is a clear case in which a very distinguished servant of one of our ex-colonial territories has given his whole life and service to that country and is now denied the supplement of his pension which the 1962 Act should give him. If the words which my right hon. Friend wrote before the election mean anything, they surely mean that this man should get help.

The question of principle whether the Government should or should not take over responsibilities for these pensions is extremely difficult, and it must be decided in the general context of the Government's aid programme and the relationship between this country and her former Colonial territories. We want to do nothing which will exacerbate or make it more difficult for those countries to pay their way in the world. Many arguments are put forward, and it is not my intention to go over that ground tonight, but I hope that the hon. Member will make a clear statement of what the Government's policy is. I hope that in particular he will say whether he is prepared to look at all individual cases in which hardship appears to have arisen and see whether he can put the matter right.

After the delegation from the Overseas Service Pensioners Association visited his right hon. Friend last week, I hope that the hon. Member feels, as I do, that these words in the letter from the Chancellor of the Duchy of Lancaster seem particularly unfortunate in the light of the position which the Government have taken. I hope very much that the hon. Gentleman will have the courtesy to apologise to the House and, through the House, to the pensioners themselves for this very unfortunate event which must be brought to light in order that the present position can be clearly stated by the Government and so that they may have the opportunity to apologise for any harm or misunderstanding it has caused.

12.15 a.m.

Photo of Sir John Fletcher-Cooke Sir John Fletcher-Cooke , Southampton, Test

I am very grateful to my hon. Friend the Member for Cirencester and Tewkesbury (Mr. Ridley) for having raised this topic tonight, and to the Minister for permitting me to make a short intervention. I will be brief, but at the outset I must make it clear that I have an interest in this matter as an overseas pensioner and, secondly, that I would have said what I propose to say, irrespective of the complexion of the Government. I do not regard this as at all a party matter, but something which any Government of this country should take into account.

First, let me say that I would approach this matter somewhat differently from my hon. Friend, in that I would look at it from the point of view of those independent members of the Commonwealth who are landed with this quite substantial burden of paying pensions to overseas pensioners.

It must be remembered that, in the not too distant future, when a new generation has arisen with little or no knowledge of what members of Her Majesty's Overseas Civil Service have done for these countries, voices will be raised that the burden of paying these pensions should no longer be carried by these countries.

If and when that time comes about, it will be likely to sour Commonwealth relations. All sides of the House are desperately anxious that at the present time we should do everything we can to ensure a strengthening of Commonwealth relations. Therefore, the British Government, while there is still time, should take a positive step to strengthen those relations by relieving these newly independent countries, none of which are too well off, of this particular burden.

I put my main emphasis on the point of view of the countries which at present have to pay these pensions. Secondly, I would turn to the pensioners themselves, whose position has been adequately dealt with by my hon. Friend the Member for Cirencester and Tewkesbury. I would like to add, however, that probably more might be said about the widows and orphans pension schemes, which, as hon. Members are no doubt aware, fall into two categories, namely, those administered in this country through the Crown Agents on behalf of the countries concerned, and those administered directly by the overseas countries themselves. I am reliably informed that as regards those administered overseas the records of contributions paid and pensions registered are very far from being accurate or up to date. I know that this causes great concern to those who may one day have to claim those pensions as widows or orphans.

On the second point—the position of the pensioners themselves—it would be wise for this country to follow the example of France, Holland and Belgium and to accept responsibility for the payment of these pensions and not to be content merely to say that it will underwrite them or guarantee them or have a look into the matter if and when difficulties arise. I suggest, finally, that this would not and certainly need not be any additional burden on the British taxpayer, for almost all of the countries which are responsible for the payment of these pensions are in receipt of aid from this country, paid for by the British taxpayer in one form or another. It should be possible for such adjustments to be made so that there would be no additional burden on the taxpayer here.

For these three reasons, I beg Her Majesty's Government to consider the desirability of coming out into the open and accepting this obligation. I trust that the Parliamentary Secretary, to whom I have expressed my gratitude for giving me time to speak—time to which he would otherwise be entitled—will give the House some assurances on this matter.

12.20 a.m.

Photo of Mr Albert Oram Mr Albert Oram , East Ham South

I was glad to hear the hon. Member for Southampton, Test (Sir J. Fletcher-Cooke) say that he did not regard this as a party matter. It is not such a matter, although his hon. Friend the Member for Cirencester and Tewkesbury (Mr. Ridley)—and I make no complaint about this—tended to make some party points in his remarks.

I will, first, refer to some quotations mentioned by the hon. Member for Cirencester and Tewkesbury. The letter sent by my right hon. Friend the Chancellor of the Duchy of Lancaster was an expression of sympathy sent to the association in a personal capacity. I am sure that that expression of sympathy is shared by all hon. Members. It did not—and the hon. Gentleman himself admitted this—purport to be a pledge on behalf of the Labour Party and, for this reason, no apology by my right hon. Friend or anybody else is called for. However, rather than deal with any party points, I am sure that the House would prefer me to deal with the points of substance raised tonight.

Perhaps I should begin with a brief recital of the main facts. Apart from former members of the Indian Civil Service, there are at present about 25,000 former overseas officers and their dependants receiving pensions in respect of their service overseas. The total cost of the pensions and pension increases paid to these officers and their dependants by overseas governments has now risen to about £12 million a year.

The principal request now made by the association and hon. Gentlemen opposite tonight is that Her Majesty's Government should assume direct responsibility for the payment of pensions, and it is argued in support of this request that the officers were effectively—or in some cases, it is argued, were actually— in the service of Her Majesty's Government. This is not the case. Most of these officers were members of Her Majesty's Overseas Civil Service. This was described in a document, Colonial 306, which established it as a "general service under the Crown".

Crown service is not, however, and never has been the same as service under the British Government. The officers were mostly appointed by or on behalf of a Secretary of State, and the appointments were clearly expressed to be in the public service of a particular overseas Government—Kenya, Fiji, or whatever it might be. The overseas Government paid their salaries and that part of their total emoluments described as a pension. These pensions were prescribed and are calculated under the legislation of these overseas Governments and this legislation, which is often now the legislation of independent countries, is the sole authority for the payment of the pensions.

I recognise the argument that these officers, or many of them, regarded themselves as serving the purposes of Her Majesty's Government overseas, but that does not make them employees of the British Government. They were employed by overseas Governments and their pensions are based solely on the legislation of those Governments. The question is not, therefore, whether Her Majesty's Government should themselves discharge an existing obligation to former employees, but whether they should entirely alter the traditional pattern of the terms of service of the employees of overseas Governments by proposing to those Governments that they should take over from them direct responsibility for one of those terms of service. The main arguments in some of our earlier debates have concerned, not the payment of basic pensions but the payment of pensions increases. The Pensions (Increase) Act, 1962, provided for the payment of pensions supplements to overseas officers and their dependants, and under that Act, which was generally welcomed by this House, about 11,000 overseas pensioners are receiving supplements totalling about £1,100,000 a year. If the British Government were to consider taking over responsibility for these pensions they would have to ask very carefully indeed, as to what purpose and to whose benefit they should assume so considerable an additional burden.

Two main arguments are advanced, and it is desirable that they should be kept separate. The first—and this was argued particularly by the hon. Member for Cirencester and Tewkesbury—relates to the doubt and anxiety which the pensioners feel about their future security. I assure the hon. Gentleman that on the evidence of the record of these overseas Governments, except in the one or two, as I think he will admit, minor instances, such as the Ghana taxation problem and the Somali and the Zanzibar defaults, the record of the overseas Governments has been remarkably good. When my right hon. Friend met the deputation the other day, I think it accepted the point that on the evidence of the past record its members ought not to have any undue anxiety about the future.

The hon. Member for Test made the point about relieving overseas Governments of a burden, and said that this would be a form of aid, but I would put this point to him. The richer overseas Governments have been those that have been most able to employ these officers, and are therefore those that are now carrying the bigger burden of pensions payments. If we were to relieve all the overseas Governments of those pensions payments we would be relieving the richer Governments of a burden, probably at the expense of others that need aid more. In other words, we would alter the pattern of our aid in a way that would not suit the needs of the receiving countries.

I therefore do not think that either the argument that here is a way to distribute aid to overseas Governments or that of the anxiety of the pensioners, stands up. Certainly, in the present situation as we see it, a sufficiently strong case has not been advanced this evening for us to alter the basis upon which these pensions are paid. I hope that hon. Members will take it from me that as a result of their having raised this matter tonight and as a result of the deputation which my right hon. Friend received the other day, the case has been very fully and adequately examined once again, but we regret that we are not able to accede to the points made in this debate.

Photo of Mr Nigel Fisher Mr Nigel Fisher , Surbiton

Before the hon. Gentleman sits down, will he refer to what was said by my hon. Friend the Member for Cirencester and Tewkesbury (Mr. Ridley) about the hardship angle and say whether he would feel inclined to go as far as my right hon. Friend the Member for—

The Question having been proposed after Ten o'clock on Monday evening and the debate having continued for half on hour, Mr. DEPUTY-SPEAKER adjourned the House without Question put, pursuant to the Standing Order.

Adjourned at twenty-nine minutes past Twelve o'clock.