Clause 1. — (Increase of Certain Pensions)

Orders of the Day — Pensions (Increase) Bill – in the House of Commons at 12:00 am on 1st December 1965.

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7.1 p.m.

Photo of Mr Eric Lubbock Mr Eric Lubbock , Orpington

I beg to move Amendment No. 1, in page 1, line 10, at the end to insert: (a) if the pension began not later than 1st April 1950 eighteen per cent. The Bill provides for a scale of increases to public service pensioners ranging up to a maximum of 16 per cent. for all those pensioners who retired on or before 1st April, 1957, but, no matter how many years before that date a public servant may have retired, the percentage increase is limited to 16 per cent. even though, as has been said many times, the further back one goes in time the smaller is the basic pension on which the increase of 16 per cent. falls to be calculated.

It is interesting to look back at the debates on the last Pensions (Increase) Bill and observe that this was one of the main criticisms made at the time by the right hon. Member for Sowerby (Mr. Houghton). The right hon. Gentleman asked rhetorically why the scale in the Bill should be amended as he was seeking to do to top up still further the pensions awarded earlier, and he replied to his own question that those who had been retired the longest had suffered most and for the longest time. We do not pretend by this Amendment to rectify the injustice which has been perpetrated on these older pensioners by successive Governments. All we say is that, if one is to have arbitrary percentage increases on a scale which rises the further back one goes in time, we should not stop at 1957. The figure of 18 per cent. and the associated date of 1950 which appear in this Amendment happen to be identical with the proposals made by the right hon. Member for Sowerby three years ago.

Under the present Bill, some of these older pensioners will, in fact, receive less this time than they did three years ago. I give as an example the case of the postman cited by the right hon. Member for Kingston-upon-Thames (Mr. Boyd-Carpenter) in his Second Reading speech on 9th November, 1962. He showed that the postman who had retired early in 1956, with 40 years' service, and who was then over the age of 70 had a pension of £4 5s. 9d., which was increased to £5 3s. 7d., an increase of 17s. 10d. This time, the postman receives only the bare 16 per cent., and not the additional amount provided as a lump sum for the first time under the 1962 Bill, so that he will receive 7s. 8d. less under this Bill than he received under the Bill three years ago. In this connection, I quote from an interesting letter which the present Prime Minister wrote to a Mr. F. Ainsworth of Southport just before the last election: Since we feel the position is a positive disgrace, we have persistently brought this up in the House of Commons and criticised the Government for its meanness. We have also called for public service pensions to be linked to some economic indicator so that pensioners are not only compensated for rising prices but also receive their full and fair share in rising national prosperity. I realise that one cannot go as far as that in discussing this Amendment, but I quote that letter to show how far short of the Government's promises at the time of the election the Bill falls.

Returning to the speech of the right hon. Member for Sowerby when he proposed an Amendment identical to this on the 1962 Bill, he spent a considerable part of his speech in excusing himself for the anomalies which he said might be created by the Amendment. I do not propose to waste the Committee's time by reading out a whole series of figures, but I point out that we already have pensioners receiving slightly more than their colleagues who retired from the same grade later on, although in no case do they approach the present-day levels which would be applicable to their grades. To take one example, a higher executive officer who retired on 31st March, 1954, receives a pension of £609, whereas the equivalent for a year later is £606. There are other examples of this kind which can be cited. Therefore, although the Amendment may create a few further anomalies of a few pounds, it involves no breach of principle and it is not necessary, therefore, to justify it from that point of view. However, if it were thought necessary to add a stop provision so that no one would benefit by more than his colleague who retired at a later date, I should be prepared to accept it.

There seems to be a misconception in the Government's mind about the position of these older pensioners. On 18th November last, the Chief Secretary said that, under the previous pensions increase legislation, there had been a levelling up of pensions between 1950 and 1957, and he went on to say: We, therefore, as it were, got everyone on an equal basis in 1957, which means that it is not necessary to go back beyond that date …"—[OFFICIAL REPORT. 18th November, 1965; Vol. 720, c. 1355.] The right hon. Gentleman is entirely wrong in that matter, and it is amazing that a responsible Minister should have so flagrantly misled the House. I shall not run through a whole series of figures, but I point out to the Financial Secretary that a clerical officer who retired in 1950 receives £29 less than his colleague who retired in 1957, and, at the other end of the scale, an assistant secretary receives £259 less. In percentage terms, these differences are 6 and 19 per cent. less, respectively. Under the Bill, these percentage differences will remain the same, though in money terms they will actually be wider.

During the Committee stage of the 1962 Bill, the right hon. Member for Sowerby said: An interval will elapse before a further Bill can be introduced. There could conceivably be a change of Government, in which case I can safely promise that there will certainly be a new initiative in this matter." —[OFFICIAL REPORT, 20th November, 1962; Vol. 667, c. 1164–5.] The new initiative we see is a Bill drafted in precisely the same terms as its Tory predecessor and under which the benefits are very little different.

Photo of Mr Peter Walker Mr Peter Walker , Worcester

In fairness, the hon. Gentleman should agree that the introduction of the last Pensions (Increase) Bill with its flat rate payments did something to close the differential. But this Bill does nothing.

Photo of Mr Eric Lubbock Mr Eric Lubbock , Orpington

Yes, I agree. I have referred to the case of the postman cited by the hon. Gentleman's right hon. Friend the Member for Kingston-upon-Thames, pointing out that such pensioners were better off to the tune of about 7s. 8d. under the previous legislation than they will be this time, and I do not think that the money has necessarily gone to those who need it most. What I was trying to point out in making my quotation from the speech of the right hon. Member for Sowerby was that there has not only been no new initiative, as these proposals are based on percentage increases in a scale which goes backwards in time, but the total amount by which it is proposed to raise pensions is almost precisely the same when one makes adjustments for the change in the index of retail prices since 1962. I have had the opportunity of doing the arithmetic more thoroughly than I could do it while the Chief Secretary was speaking on Second Reading. The difference is between £22·1 million and £22·8 million, so that the total amount of benefit after the adjustment of retail prices is almost precisely the same.

What is the cost of the Amendment? The Financial Secretary gave the total value of the pensions awarded in the Civil Service prior to 30th September, 1950, in a Written Answer on 14th May of this year, as reported in col. 152 of the OFFICIAL REPORT. He said that, including the pensions paid to widows and dependants, the sum was £11·4 million. If one takes the additional 2 per cent. which I am seeking to give to these pensioners, the upper limit of cost in the Civil Service would be £228,000. But the actual sum would be less than that, because there is the period between 31st March, 1950, and 30th September, 1950, and one has to take into account the fact that, unfortunately, some of these pensioners have died since that Answer was given.

We can agree that this is a miserably small amount in comparison with the expectations which were aroused in the minds of pensioners at the last election. I think that they would have been genuinely amazed if they had then been told that we should be arguing whether to pay a pensioner who retired before 1950 16 per cent. or 18 per cent. more than he was already receiving. Indeed, they would be amazed to know that this Bill is almost identical with its Tory predecessor. There has been no new initiative such as the right hon. Member for Sowerby promised. The Government have even succeeded in gagging us so that no reference to parity may be made later in Committee. I hope that the right hon. Member for Sowerby and some of his colleagues who have been active in these debates in the past are thoroughly ashamed of the Government's performance and that he will urge his colleagues to accept this extremely modest Amendment.

Photo of Mr Paul Dean Mr Paul Dean , Somerset North

I rise to support the Amendment moved by the hon. Member for Orpington (Mr. Lubbock). It goes nothing like as far as I would wish, but we are in a position in which half a loaf is better than no loaf. I should have preferred the suggestion made earlier for bringing people up to the level of 1956.

Nevertheless, I agree with the hon. Member that the Amendment goes some way to give more help to those who have been retired the longest and that it does so at a very modest cost. On Second Reading both the Chief Secretary and the Financial Secretary claimed—I quote from the Financial Secretary's speech—that the poorer pensioners will still be doing better in relation to their original pensions than the better-off pensioners". Yet when I interrupted the Financial Secretary to ask him whether it was a fact that under the Bill a pensioner receiving a pension below £500 would get a smaller increase than under the 1962 Act, he admitted that this was the case. As reported in col. 1459, he said, That is quite true".—(OFFICIAL RF PORT, 18th November, 1965; Vol. 720, c. 1459.]

Photo of Mr Niall MacDermot Mr Niall MacDermot , Derby North

The hon. Member was speaking of the over-70's.

7.15 p.m.

Photo of Mr Paul Dean Mr Paul Dean , Somerset North

I should have said that it was for the over-70's. I admit that the Financial Secretary went on to give his reasons for claiming that the present Bill was the most equitable arrangement. But he did not deny that the over-70's on the smallest pensions would be less favourably treated under the Bill than under the 1962 Act.

This is the point to which the Amendment is applied. It is generally agreed on all sides of the Committee that those who have been retired longest are most in need of extra help. They are the people who have felt the effects of infla- tion longest. Those who retired before 1956 have been less effectively insulated against inflation because the earlier Acts did not take this into account to the same extent as has been done in Acts since 1956.

The escalator principle was designed to some extent to meet the problem of the older pensioners, but it still did not meet the argument and could not meet the argument that the smaller the pension, the smaller the actual increase. This is surely one of the basic arguments against the escalator principle unless we take the escalation up to a very much greater extent than is the case at the moment. I admit that in this case we have 16 per cent. as the highest figure instead of 12 per cent. in the previous Bill, but the older pensioners on the smaller pensions are nevertheless not getting as big an increase as in 1962. Whatever the arguments may be against the flat-rate increase at 70, it resulted in additional help for the older pensioners on the smaller pensions, and some of these are not getting the National Insurance pension. This is an immensely important point which was mentioned on Second Reading.

Can the Financial Secretary tell us how many of these people there are? How many public service pensioners are there who are not getting the National Insurance pension? The number is probably comparatively small, but these are almost entirely in the older categories, and these are the people, in particular, with whom we should be concerned when we are discussing how we can best improve the lot of the older pensioners.

Photo of Mr Thomas Price Mr Thomas Price , Westhoughton

I cannot answer the question as to how many, and no doubt my hon. and learned Friend the Financial Secretary will give the figures. But a reply ought to be made to that point. There are a great many people in the country who were in the category of earning over £420 per annum and who under the old National Insurance Act were not entitled to receive a pension at all. Wide categories were opened up later by voluntary contributions. But it ought to be borne in mind——

Photo of Dr Horace King Dr Horace King , Southampton, Itchen

Order. This is becoming a speech. Interventions are not for the purpose of making replies. The hon. Member should wait until later when he may catch my eye.

Photo of Mr Thomas Price Mr Thomas Price , Westhoughton

I am sorry, Sir Samuel. I will try to develop the point a little later.

Photo of Dr Horace King Dr Horace King , Southampton, Itchen

If the hon. Member catches my eye later.

Photo of Mr Paul Dean Mr Paul Dean , Somerset North

I am obliged to the hon. Member for Westhoughton (Mr. J. T. Price) and I hope that if he catches your eye, Sir Samuel, he will develop this point. I very much agree with the point which he made. We are dealing with people who did not join the National Insurance scheme, not because they were idle but because they were debarred from doing so by the regulations at the time. It was not their fault. They were not able to join the National Insurance scheme and to enjoy the pension which they would then have had.

The Bill does not maintain the 1962 differential. Indeed, within the group that we are speaking of, it is shifting the differential back to the higher pensions. I do not believe that we have been given convincing reasons by the Government why this should be so. We have been told that this is an interim Measure and that major changes are not being made now because the Government are not ready to make them. Surely, then, there is everything to be said for maintaining the 1962 pattern as precisely as possible until the major reform of the scheme is ready to be brought forward.

In this instance, the Government have fallen between two stools. They should either have kept to the original basis or brought in a radical reform of the whole system. The Amendment would go some way to meet the problem of the older, smaller pensioners, more adequately than the Bill as drafted. I hope that the Government will not reject the Amendment, but if they do they must give us good reasons for doing so.

Do they agree that the Amendment has merit? If they do not, why not? We shall not be convinced by stonewalling and by arguments that this is merely an interim Measure and that the Government will make no changes until they have done their homework. Nor will it be convincing if they suggest rejection of the Amendment on the ground of cost, for that has been shown to be comparatively modest. But if the Government do put that forward as a reason for rejecting the Amendment, the onus is on them to find some way in which they can accept the spirit of the Amendment at a cost which can be afforded. I hope that the Financial Secretary will be able to answer these points. I am pleased to support the Amendment.

Photo of Mr Thomas Price Mr Thomas Price , Westhoughton

I am sorry if I was slightly out of order in making a few comments in my intervention just now, Sir Samuel. The hon. Member for Somerset, North (Mr. Dean) has made a thoughful contribution in support of the Amendment and I wish to make few comments on what he said and what the hon. Member for Orpington (Mr. Lubbock) was saying when I came into the Chamber.

I say to the hon. Member for Orpington that it is one thing to make heroic gestures in support of some desirable reform and quite another to find the resources to carry it out. I listened respectfully to what he said and I hope that he will pay me a similar courtesy.

The attitude now adopted, seemingly, by the Liberal Party is to brush aside the Bill as something of little account. The hon. Member used strong adjectives in his peroration, pouring scorn on the Bill. I am entitled to remind him that, with all its limitations, the Bill involves the Exchequer in a charge of £18 million in the current year and more in later years.

Photo of Mr David Steel Mr David Steel , Roxburghshire, Selkirkshire and Peeblesshire

In that case, did not the hon. Gentleman hear the figure quoted by my hon. Friend the Member for Orpington (Mr. Lubbock) of the sum that would be involved in the Amendment?

Photo of Mr Thomas Price Mr Thomas Price , Westhoughton

No. I said that I came in during his speech, when he was in full spate. I have not had the pleasure of listening to the whole of his argument. I am not suggesting that he does not support it with his usual sincerity. But I object to the impression being given that the Bill is only chicken-feed when, in fact, it involves the Treasury in an additional charge of £18 million plus subsequent increases which will be cumulative.

I doubt whether it is possible to draw an arbitrary line at 1950 and leave out, by some kind of rough justice, people who retired in subsequent years, although I agree that many of those who retired before 1950 are getting inadequate pensions. But this would be a false and unscientific way of tackling the problem.

I am closely interested in pension funds in another context. The Government are being charged with slavishly following what some Tory Ministers did and with not doing something that will meet the whole need. But I remind the Committee that 16 million people, including public servants, out of a working population of 24 million, are enjoying pension schemes of one kind or another. Probably 13 million are in membership of voluntary funds, whose trustees have no public purse to make adjustments necessary to bring their pensioners up to a higher standard.

We must have a proper sense of balance of morality and equity on these questions. Because we can draw on the public purse, we must not be irresponsible. The House, by Statute, in the past has made generous provision for civil servants and I strongly support it. But to imagine that we can cushion people who happen to be in the Civil Service from all the effects of inflation is an illusion. It cannot be done. There are many other people in the country suffering the same kind of hardship with no possibility of redress except on a voluntary basis. I wish to see the position improved but we have to have a sense of reality.

Photo of Mr Eric Lubbock Mr Eric Lubbock , Orpington

Was this what the hon. Gentleman said to public service pensioners in his constituency during the election?

Photo of Mr Thomas Price Mr Thomas Price , Westhoughton

I could not have said anything to them because I was never asked about it. If I had been asked, I would have given an honest answer. I do not make speeches at election time merely to be popular. That is not an honest way of politics. Everyone concerned should be reminded that there are many citizens in a less favourable position to pursue their claims.

Photo of Mr Peter Walker Mr Peter Walker , Worcester

In that case, does the hon. Gentleman agree that when, before the election, the Chairman of the Labour Party said that it was moving towards parity, he was being irresponsible?

7.30 p.m.

Photo of Mr Thomas Price Mr Thomas Price , Westhoughton

I would need notice of that question. It is no good the hon. Gentleman trying those Front Bench tricks on me, for I have heard them all before. I would have to read what was said before I could comment. I hope that I have not wearied the House by bringing in a note——

Photo of Mr Peter Walker Mr Peter Walker , Worcester

No. It has been very helpful.

Photo of Mr Thomas Price Mr Thomas Price , Westhoughton

—which has been less harmonious than that which has previously prevailed, but it should be said that while we have great sympathy for these projects, we have to consider our resources. There are many thinks which I have wanted to do while I have been a Member—and I have been a Member for a long time, and I have seen some of my most cherished objectives put aside because the resources for them have not been available.

In addition to the benefits provided in the Bill for many people who will welcome them, limited though them may be, there have been pensions increases under previous Acts in 1950, 1952, 1954, 1956, 1959 and 1962, so that almost a biennial review of the problem has been put before Parliament. All of the pre-1950 pensioners who would be especially benefited by the Amendment have already had six increases from those Acts. I hope that I shall not be misunderstood if I say that I do not support the Amendment in its present terms, because it seeks to discriminate in a way which would not be a solution to the problem.

Photo of Dr Reginald Bennett Dr Reginald Bennett , Gosport and Fareham

I support the Amendment even though the measure it proposes is very small and modest for trying to alleviate the situation of people who have been longest on pension. As I represent such a large number of older public service pensioners, I like to think that tomorrow they will all be able to read the observations of the hon. Member for Westhoughton (Mr. J. T. Price), giving them the coldest and chilliest comfort in the coldest and chilliest winter, so that they will know what the Government are made of—unless the hon. Gentleman goes further still to settle their hash.

We know that the older codes of 1950, 1945 and 1919 supplied only miserably small pensions compared with those of the later codes. We know that they have been increased by percentage and flat-rate increases at certain times, but when the Government now say that in this differential scale of percentage increases the older pensioners will be getting a relatively bigger increase than those on the most recent codes, they know perfectly well that they are also to get less money than the others. Surely, for those who are most in need of the money to he receiving less money is an absolute travesty of justice.

When this is viewed in the context of the bombastic remarks by hon. Gentlemen opposite before the last election, which must have managed to seduce the allegiance of so many pensioners, I must say that this is one of the shoddiest performances which any party in office has ever put up. The hon. Member for Westhoughton said that it was one thing to make a gesture and another to find the money. What has his party been doing all these years but making elaborate gestures? Even if he has not read the remarks of his party chairman about parity, the hon. Gentleman would do well to read them so as to be able to answer his constituents, because I am sure that they will be after him when his local paper reports what he has been saying about pensioners.

I support the Amendment as it moves in the direction I desire. This modest Amendment deserves our support, and if the Government do not mean to accept it, I firmly wish to go into the Lobby in its support.

Photo of Mr Rafton Pounder Mr Rafton Pounder , Belfast South

I listened with interest to the hon. Member for Westhoughton (Mr. J. T. Price). He should bear in mind that the Pensions (Increase) Acts which he sneeringly mentioned as being triennial——

Photo of Mr Thomas Price Mr Thomas Price , Westhoughton

I have never sneered in the House of Commons. It is not my practice to sneer at anybody, but to listen respectfully even to the most hostile opinion.

Photo of Mr Rafton Pounder Mr Rafton Pounder , Belfast South

Shall I say "unsympathetically"? The 1956 Act gave a 10 per cent. increase on the 1952 rate, the 1959 Act a further 12 per cent. and the 1962 Act a further 12 per cent. increase. I agree with the hon. Gentleman about conserving national resources and not being extravagant but, as the hon. Member for Orpington (Mr. Lubbock) said, the expenditure involved in granting the Amendment would not be very great. I admire the hon. Member for Westhoughton for not having made promises at the election merely to curry favour, but that was not the pattern of the speeches of quite a number of his right hon. and hon. Friends 13 or 14 months ago.

No one would say that the 18 per cent. increase suggested in the Amendment is the last word, but it is a step in the right direction. Nor is it all that rough justice, as the hon. Member for Westhoughton suggested it was, to draw the line at 1950. To draw it at 1955 probably would be, because between 1950 and 1955 there were substantial increases in Civil Service salaries, whereas before 1950 they were neither so frequent nor so substantial. Although an element of rough justice is involved in drawing the line at 1950, it would be a great deal fairer than taking the year 1955, or some other later date.

It is the older pensioner who is receiving the thin end of the stick in the Bill. On Second Reading, the Chief Secretary said that the Bill was a holding Measure. Can it therefore be assumed that in due course another Bill is likely to be presented, for this particular Bill makes no pretence at finding a solution to the problem of the long-term position of the public service pensioner? However, if the Bill is an indication of what a subsequent Bill from the Government would contain, it is not very encouraging.

The retired person who would be covered by the Amendment is now almost certainly an octogenarian, or very close to it. In the 1962 Act there was a bounty of £20 for the older pensioner. That bounty has gone out of the window in the Bill and in its place we have a flat 16 per cent. increase proposed in Clause I, which on £20 is about 1s. 3d. a week—wholly inadequate by any social or any other consideration.

I trust that the Government will he able to accept the Amendment, first because it goes some way towards giving justice to the older pensioner and, secondly, because even if one argues about conserving national resources and not being wasteful and not squandering public funds, the amount involved is infinitesimal.

May I cite a specific case brought to my attention only 10 or 11 hours ago? It sums up the kind of position in which a tremendous number of pensioners are placed. It concerns, in fact, a lady teacher who retired in 1941 after 35 years' service. She retired before the compulsory National Insurance provisions were introduced. In 1941, her pension was £7 2s. 4d. a month. As the result of various Acts, it has been increased to £14 a month. The increase from £7 to £14 may seem reasonable, but it has to be remembered that over that period of more than 20 years the increases in the cost of living have been far in excess of the increases in her pension. Her pension now is £3 4s. 7d. per week. An additional 16 per cent. on that is about 10s. It is very important that something should be done—as a matter of conscience and social justice, if nothing else—to alleviate the very unfortunate position in which these persons are now finding themselves. The differential is wide. Salaries are very much higher now than they were 10 or 15 years ago. This is accepted. Please can something not be done to increase the pension entitlement for these old persons?

Photo of Mr Norman Cole Mr Norman Cole , Bedfordshire South

I want to refer to one remark made by the hon. Gentleman the Member for Westhoughton (Mr. J. T. Price) and then I will address my remarks specifically to the Amendment. The hon. Gentleman did not sneer, but he drew attention to the fact that previous Pensions Acts amounted almost to a triennial review. I think it is true to say that in every occupation in this country very few people go for three years without having a wage review. What is the difference between these people, be they manual workers or white collar workers and pensioners? I think a pensioner has a few more needs. Why we should not have Pensions (Increase) Bills every three years I cannot, for the life of me, see. I should like them to be almost biennial.

I hope that, in due course, we will reach a situation where we will have no need for these Bills and that instead betterment will flow automatically, as a right, to the pensioner. In comparison with the amounts mentioned in the Financial Memorandum, the amount in this Amendment is very small indeed. I do not imagine that the Government will adduce cost as an argument against it. I hope that they will not because it will not be convincing. Forgetting all remarks made by the hon. Member for Westhoughton about "rough justice" and "we cannot necessarily cushion everybody", what is supposed to happen to someone who retired in 1951? The best we can do for that person is to give him the same increase in pension as if he retired in 1957 or afterwards.

What is supposed to have happened in those seven years? Are there supposed to have been no increases in the cost of living? There undoubtedly have been and this has nothing to do with the Government; it is an ordinary fact of life. I agree that we cannot go back to the very beginning of time, but I should have thought that going back to 1950, as previous Acts have done, is a modest halfway measure. The hon. Member for Belfast, South (Mr. Pounder) said that most of these people would be octogenarians. They probably are, but they still have to live; they still have their needs, and they still live in a very affluent society such as we have today. It is much more expensive to live now than it was in 1950.

For these reasons, I cannot see that there is any real case for opposing this Amendment. It cannot be opposed on cost, on justice or equity to other people, because they are all getting their increases. It rather looks as if the longer one lives the less one gets and the more expensive one finds it is to live. All these people are ex-employees of the State, and this does not reflect on the honour of the State.

The hon. Member for Westhoughton tried to compare the people about whom we are talking. with many other people who are in a similar position but whose trustees do not have access to public funds. If these are public service people or people in the Civil Service, they will, in many cases, be denied the opportunities for making a little more money which obtain in many areas outside the service. To try to say that because other people in other walks of life cannot have certain increases, and by that means to deny this increase, is to argue, if one took the matter to its logical conclusion, that we should not have any Pensions (Increase) Bills at all. People would have to go on and hope for the best. I think that that would be quite impossible and, with all due respect to the hon. Gentleman, quite mean and shabby if the Government cannot find this comparatively small figure which is a fraction of 1 per cent of the annual budget of this nation.

7.45 p.m.

Photo of Mr David Steel Mr David Steel , Roxburghshire, Selkirkshire and Peeblesshire

I do not think that the hon. Gentleman the Member for Westhoughton (Mr. J. T. Price) realised what he was letting himself in for when he intervened in this debate.

Photo of Mr David Steel Mr David Steel , Roxburghshire, Selkirkshire and Peeblesshire

I am glad that the hon Gentleman is. He raised a number of points about the figures given by my hon. Friend the Member for Orpington (Mr. Lubbock) on the cost of the proposal which I and my Liberal friends have tabled. The cost of the proposal, as far as the Civil Service is concerned, is exactly £228,000. Compared to the cost of the whole Bill, which is £25 million, it is but a fraction of the total expenditure. Let us not pretend that we in the Liberal Party are being profligate with public funds in putting forward this modest proposal. The hon. Member for Westhoughton went on, in an almost contradictory argument, to say that he did not think that this was a very good idea, because we were not going far enough and not offering a large enough increase to those who were retired before 1950.

Photo of Mr Thomas Price Mr Thomas Price , Westhoughton

This is the difficulty of debates in this Committee. A Member says something and another Member puts a construction and another Member puts a construction on it that suits his own argument. It is going on all the time and I do not complain about that. I am grateful for having had the figure quoted, but I am not unfamiliar with actuarial situations and I should need to see data on which that computation was made before I said yes or no to it. It may only be a minimal figure. However small it is, we are dealing with this as a matter of principle and we should not be unduly influenced by anything large or small.

Photo of Mr David Steel Mr David Steel , Roxburghshire, Selkirkshire and Peeblesshire

The figure I quoted came from the Parliamentary Answer given by the Minister on 14th May this year. The speech of the hon. Gentleman the Member for Westhoughton was well worthy of a speech from the Front Bench. Surprisingly enough, for a back bencher of the Labour Party he rejected an intervention by the hon. Gentleman the Member for Worcester (Mr. Peter Walker), who referred to the pledge given by the Chairman of the Labour Party at the time of the last election. The hon. Gentleman cast doubt on the origin of this quotation. I know that one cannot expect the Conservative Front Bench to be adequately briefed on this occasion, since their back-room boys have become front-room boys. However, I have the quotation and it comes from a letter of 14th September, 1964, to the Chairman of the Officers' Pensions Society. The Chairman of the Labour Party said: … you will know that we are favourably disposed towards the principal of 'parity' and that we would open negotiations with interested bodies to see how reforms along these lines can be introduced. I think that the Labour Party gave a very clear pledge about the kind of approach that they would have to the question of public service pensions. Now the Government have gone back on this. If any section of the population is to be disappointed with the performance of the Labour Party it is the older section. The party has gone back on a number of matters in which they led the electorate to believe. We have had the familiar references from the Labour Ministers to the old age non-pensioner, and the statement that they should seek National Assistance, which we have had from the Tories. Now we have in this Bill, no sign of a move towards the principle of parity which we understood the Labour Party to accept.

As far as this very modest proposal which we have put forward is concerned, we want to raise the scale of increase to those who retired before 1950 to 18 per cent. Eighteen per cent. is a magical figure in the ears of Labour Ministers at the moment. It is the figure of Labour's lead over the Conservative Party in the opinion polls. I am inclined to think that one reason why so many Conservatives appear to be so keen to support the Labour Government is that this is the soundest conservative administration we have had for some time.

Photo of Mr Peter Walker Mr Peter Walker , Worcester

Will the hon. Gentleman give the Liberal figure in that poll?

Photo of Mr David Steel Mr David Steel , Roxburghshire, Selkirkshire and Peeblesshire

I dare say that, even if the hon. Gentleman has not been briefed with anything else, he has been briefed with that information. I have risen merely to give a concrete example of why I think the Government should accept this modest Amendment. The example is my own grandfather, who is 87. He retired in 1943 from being headmaster of a primary school with over 1,200 pupils. His pension today is £607. Under the Bill is will be increased 16 per cent. to £703. If the Government accepted our modest proposal, it would be increased to £720. That still does not compare with the figure for those who retired in 1957, which is as far back as the Government are prepared to go. The pension of a person in a similar situation—indeed, with a school half that size—who retired in 1957 is £752. The increase of 16 per cent. in the Bill will bring it up to £872. The present pension—never mind the lump sum—for someone retiring from that position is £1,035, which is very different from the £703 granted to people like my grandfather who retired before 1950.

The Liberal Party's proposal is not revolutionary, nor is it profligate. It will not bring down the country's economy. It would go a small way towards relieving the hardship of one section of the community.

Photo of Mr Reginald Paget Mr Reginald Paget , Northampton

I was very interested to hear some of the reasons why inflation is presumed to have started in 1956. It did not start then. I just do not understand why we should merely compensate those injured by inflation subsequent to 1956 and give no compensation at all to those injured by inflation before then, who are the oldest, the least able to look after themselves, and economically the weakest. If the Bill is to be a guide for the Services when we deal with them, this argument applies with much greater force to those who retired very much earlier even than these.

Photo of Mr Niall MacDermot Mr Niall MacDermot , Derby North

The movers of the Amendment argue as the reason for it that we should do more for those who have been longest on retirement. What they omit to mention is that, in so far as we have departed from the pattern of the 1962 Act, that is precisely what we have done, to give more benefit to those who have been longest on retirement.

The hon. Member for Somerset, North (Mr. Dean) quite fairly asked, if it is being said that this is not an occasion for introducing drastic reforms, why the Government did not follow exactly the pattern of the previous Measure. I will try to answer that very fair question. The alteration that we have made is in order to spread the benefit broadly, to give most benefit to those who have been longest on retirement.

The second main assumption and argument made in support of the Amendment is that the further back in time one goes the smaller the basic pension on which the increase is calculated. Those were the words used by the hon. Member for Orpington (Mr. Lubbock). What the hon. Gentleman omitted to point out was that the increases are not calculated on the basic pension as originally granted but on the basic pension as it has been increased by previous measures, including the £20 in the last Act.

I quite take the point that it can be said that that benefit did something to help in a levelling out process. Those who got that benefit will not only keep it but will get their appropriate percentage increase, and I agree that for most of them it will be at the highest rate of 16 per cent. on that £20.

Photo of Mr Eric Lubbock Mr Eric Lubbock , Orpington

The figures I gave were actually the figures of pensions as adjusted by subsequent Pensions (Increase) Acts. I was saying that the Chief Secretary was entirely wrong when he claimed on Second Reading that these had been levelled up so that persons who retired in 1950 were now in receipt of the same pension as those who retired in 1957.

Photo of Mr Niall MacDermot Mr Niall MacDermot , Derby North

That is quite right as regards the figures the hon. Gentleman gave, but when he stated his principle at the outset I noted it very carefully. I think I have almost his ipsissima verba—the further back in time one goes the smaller the basic pension on which the increase is calculated. This is the source of the error underlying much of the argument we have heard.

Reference has been made to what my right hon. Friend the Chief Secretary said on Second Reading about the position of those who had retired before 1957. Broadly speaking—my right hon. Friend was speaking broadly—what he said was true. For the great majority of pensioners—I know that there are exceptions; I will refer to them in a moment —the effect of the first three Acts after the last war has been to produce a general plateau in the pensions—that is, pensions with increases—of those who retired before 1957. It is not an exactly level plateau. There are troughs. There are mounds. There are slight dips and slight rises. Broadly speaking, 'for the great majority of pensioners there is a general equality in the pensions of those who retired prior to 1957. That generalism does not apply on the whole to the higher level pensioners; that is, those who retired from the higher levels of the Civil Service and, generally speaking, most of the officer class of the Armed Forces.

I assure my hon. and learned Friend the Member for Northampton (Mr. Paget) that there are many cases where other ranks who retired a very long time ago have appreciably higher pensions than those who retired, say, round about the early 1950s. I have seen these figures and should be glad to show them to my hon. and learned Friend. That has been the effect of previous Pensions (Increase) Measures. It simply is not true to say as a generalism that the further back one goes the lower the pension that is being received. A particular comparison can be singled out to support an argument either way, but that is the general picture.

Photo of Mr Norman Cole Mr Norman Cole , Bedfordshire South

I think that the hon. and learned Gentleman has really put the whole of the argument up to now in that last sentence. I was waiting for it—one can produce a number of examples to prove the argument either way. That is just the point. I am concerned with those who are suffering, not with those who are all right.

Photo of Mr Niall MacDermot Mr Niall MacDermot , Derby North

The assumption on which the Amendment is put forward is that all those who retired before 1950 are, generally speaking, worse off than those who retired between 1950 and 1957. I assure hon. Members that this is not true and this is the mistaken assumption underlying the Amendment.

8.0 p.m.

Photo of Sir Raymond Gower Sir Raymond Gower , Barry

Is it not true flat more people, out of those who retired before 1950, are on lower pensions than those who retired in later years.

Photo of Mr Niall MacDermot Mr Niall MacDermot , Derby North

I do not know the answer to that question, but it is among those on lower pensions that this general level of equality has, by and large, been achieved.

I come back to the question asked by the hon. Member for Somerset, North, why did not we follow the previous pattern? Perhaps I might explain how we approached this matter of seeing who was to get any special benefit that could be given in the Bill. My hon. Friend the Member for Westhoughton (Mr. J. T. Price) was perhaps the only hon. Member who started off, as it were, with his feet on the ground, in the way that we are compelled to do in the Treasury.

One must begin by asking, what are the resources available? What is the amount that is available out of public funds for the purposes of this Pensions (Increase) Bill? As was made clear during the Second Reading debate, the figure which my right hon. Friend decided was the most that could be made available was, in round terms, £25 million, not £18 million, when one takes into account the corresponding increases which will be made under the Royal Warrant for the Armed Forces.

The starting point, if one is basing oneself on the previous Measure, which we are, is a percentage increase with an escalation back to a 12 per cent. increase, which was the pattern of the previous Measure. A repetition of this basic pattern would itself cost between £21 million and £22 million.

We could have absorbed a large part of what remained between that and the £25 million which we had set ourselves by repeating the £20 flat rate increase, but, if we had done that, there would have been precious little room to do anything else. As has been pointed out, that was done last time. That benefit will continue and it will be perpetuated in the sense that those entitled to get it will get their percentage increase on top of it.

What we found ourselves able to do was to give the benefit generally to those who had been retired longest by including two more steps in the escalation. Roughly speaking, they cost £2 million each for two more steps, namely, of 14 per cent. and 16 per cent. We found that we could do this without producing anomalies which, as has been pointed out in this debate, result if one seeks to make a higher percentage increase for those who retired before 1957.

The reason for this is that there is a general level for the majority of pensioners retiring in a given grade prior to that date. Therefore, if one starts giving higher percentage increases prior to that date it can have the effect of producing greater total pensions for the people who retired earlier than for those who retired later.

I do not know what was in the minds of the previous Administration when they introduced a flat rate increase of £20. but I suspect that one of the factors which led them to do that was the knowledge that as things stood at that date they could not go back beyond their 12 percent. increase without bringing themselves to make further steps earlier than the 1956 period and producing anomalies of that sort. We were not similarly inhibited, so we were able to spread this benefit among all those who had retired before 1957 with the two additional steps giving the 16 per cent. increase to those who retired before 1957.

We believe that that was the right decision, and anyone who argues that we ought to give the £20 flat rate increase must face the fact that it is a choice between those two. The hon. Member for Somerset, North faced that, and urged that we would have done better——

Photo of Mr Niall MacDermot Mr Niall MacDermot , Derby North

I know it is not. What the Amendment is seeking to do——

Photo of Mr Niall MacDermot Mr Niall MacDermot , Derby North

The debate has ranged widely. I do not know whether hon. Members want me to reply to the debate so far as I can do so within the rules of order. If I do not I shall be stopped. I am seeking to meet the argument put forward.

The Amendment has picked out part of the group of people who retired before 1957 and says that we should give an extra 2 per cent. to those who retired before 1950. Perhaps I might first deal with the question of cost. The proposal could not be met within the ceiling set by my right hon. Friend without depriving someone else, and I do not know who it is suggested we should deprive. The hon. Member for Orpington worked out what the cost would be for the Civil Service alone, but we have to look at the whole picture. We have to consider teachers, local government officers, people in other public services, and also in the Armed Forces. The total cost would be about £1 million.

Perhaps I could give some illustrations of why we think the Amendment would not be an apt way of trying to give help to those longest retired. Perhaps I might take first the example of the clerical officer, which the hon. Member for Orpington mentioned. The figures I propose to give are those before the increases under the present Bill, but including previous increases, for a clerical officer who retired after 40 years service. If he retired on 31st December, 1939, his pension would be £360. If he retired in 1945 it would be £363. If he retired in 1947 it would be £360. If he retired in 1949, it would have dropped to £347. This is one of the troughs to which I referred. If he retired in 1951, his pension would be £352, and if he retired in 1953 his pension would be £358. I hope that that illustrates to hon. Members what I have been referring to as this broad plateau with troughs. Certainly in that pattern there is no reason to single out people who retired before 1951 and give them a greater increase than those who retired between 1951 and 1957.

I propose now to give the House comparable figures for an executive officer. If he retired in 1939, his pension would be £491. If he retired in 1945, it would be £493. If he retired in 1947, it would be £493 again. If he retired in 1949, it would be £485. If he retired in 1951, it would be £487, and if he retired in 1953, it would be £491, the same as the 1939 figure.

Photo of Mr Norman Cole Mr Norman Cole , Bedfordshire South

I have here a document sent to me by an organisation interested in this matter. The document says that if the 2 per cent, increase was given to a clerical officer who retired in 1949 the increase would be 2 per cent. of approximately £400, which is £8, making £407 against the 1957 retirement figure of £431. There is still a considerable difference.

Photo of Mr Niall MacDermot Mr Niall MacDermot , Derby North

One can take particular years and make comparisons, but I am pointing out that there is not this dividing line which hon. Members have assumed of a lower level up to 1951 and a higher level between 1951 and 1957. In so far as there is a point at which pensions generally have begun to rise, it is after 1956. The reason is that, generally speaking, the retiring salaries of people after that date have been higher as a result of increases in wages and earnings and, consequently, the pensions on which they were based have risen. This leads us to the wider question of parity.

I hope that what I have said is sufficient to show hon. Members that we have given careful thought to this matter but that the form of the increase which they are suggesting would do less justice than the form which we have chosen in the Bill. If we wanted to single out the people retiring before 1951 for more favourable treatment it would presumably have to be done at the cost of giving less benefit to those who retired later—and that, for reasons that I have given, would produce an unjust result.

For those reasons I must urge the Committee to reject the Amendment.

I am sorry that I have not dealt with one point. I was asked how many people drawing public service pensions do not draw National Insurance pensions. In some cases precise figures are not available, and they are merely estimates. However, it is a remarkably high figure for the Civil Service. I am told that over 96 per cent. of Civil Service pensioners also draw the National Insurance pensions. The figure is lower for the Forces, but it is nevertheless estimated that even there the figure is now between 85 per cent. and 90 per cent. In the case of teachers—another large class of public service pensioners—there is a lower proportion. It is estimated that about 75 per cent. also receive National Insurance pensions.

Photo of Mr Peter Walker Mr Peter Walker , Worcester

We are grateful to the Financial Secretary for his explanation of the Government's view on this subject, and we are specially grateful to the hon. Member for Westhoughton (Mr. J. T. Price) for his contribution. The hon. Member has great knowledge of these subjects and has been concerned over the years with pensions and superannuation in another capacity. His opinions in this House are always given with sincerity, although we may differ from him. On this question he was the great defender of the Treasury position, I hope that he and the Committee will understand our attitude in this matter, and the difficulty which we face.

Over the years, with various Pensions (Increase) Bills, there has been a steady improvement in the whole basis of public service pensions. It would have been possible, in any one such Bill, to overcome all the problems involved if a Government, of any complexion, had thought fit to spend the enormous sum of money required. I am the first to confess that in the series of public service pension Bills that we brought in we never tackled the whole problem, but in every such Bill we made a further advance towards tackling the total problem.

We introduced the public service pension Bill which provided an increase right through the scale, and in our last Bill we introduced the flat-rate pension for those over 70 years of age, which did quite a lot to close the gap between them and those who retired at a later date. We therefore hoped that when this Government introduced their Bill there would be a further reform of this nature.

We were disappointed to find that there was no such further adance. The increases given are substantial, but the danger of the position is that in practice these pension increase Bills tend to be introduced only every two or three years. After this Bill becomes an. Act there is no hope of improving the situation for another two or three years.

Great disappointment was felt by retirement pensioners owing to the fact that considerable promises had been made by the party opposite on this topic. Rightly or wrongly, many hon. Members opposite have argued that parity was to be the objective. The hon. and learned Member for Northampton was certainly of this view, and has sincerely maintained it since. This position is disputed by the Government Front Bench. Nevertheless, there were considerable hopes.

We are placed in a difficult position, because we feel that the Amendment has its disadvantages, in that it creates further anomalies, as the Financial Secretary has pointed out. We are also in some difficulty because we wanted, to move Amendments which would remove all the anomalies. Unfortunately, they cannot be called because of the nature of the Financial Resolution. In this respect we find that the Government have gagged the Committee and made it impossible to remove the anomalies. We are left only with Amendments which to some extent help the situation of some pensioners but will certainly create anomalies in respect of others.

8.15 p.m.

On the last Pensions (Increase) Bill the right hon. Member for Sowerby (Mr. Houghton) moved an Amendment in terms almost identical to this. I admit that it was rejected by the then Government, but it was rejected on the grounds that they had introduced the extra flat rate £20 for those over the age of 70, which did something to close the gap. This Amendment does something to close the gap for some pensioners, but it does not deal with the problem in the manner that we would have desired, which is clearly expressed in Amendment No. 4, in page 1, line 25, at end insert: 2.—(a) In the case of a person who retired before 1st January, 1956, the increase shall be a sum sufficient to make his pension equal to an amount that would have been payable to him if he had retired on 1st January, 1956. and had subsequently enjoyed the benefit of the Pensions (Increase) Acts 1959 and 1962 plus 16 per cent. of the aggregate annual rate that would otherwise be payable under this subsection: As this Amendment is not being called, however, the only way available to us to express our concern that nothing has been done towards this end is to support the Amendment, and I advise my right hon. and hon. Friends to do so.

Photo of Mr Thomas Price Mr Thomas Price , Westhoughton

Before we leave the Amendment, it might be useful to get certain figures straight, for the record. I would not have risen but for the fact that there was a slight difference between figures that I quoted off the cuff, without referring to documents, and later figures quoted by my hon. and learned Friend in reply to the debate. It is desirable to get the figures straight. I quoted from memory in my short intervention. I said that these proposals were not chicken feed and were costing the Exchequer £18 million. I understand that the Financial Secretary considers the cost of the proposals to be £25 million. I thought that my proposal was about £1 million out, but I think that my hon. and learned Friend's figure is a good deal more out.

The overall cost of these proposals is over £25 million, it is true, but over £5 million is chargeable to local rates. Local authorities will be called upon to pay their quota of the cost involved in these increases, under the Teachers' Superannuation Act, the Local Government Superannuation Act, 1927, and certain similar Measures which affect these problems. It would be useful if my hon. and learned Friend could settle this question. We are all interested in local government as well as in the national problems with which we have to deal. It is sometimes forgotten that the legislation that we place on the Statute Book has a financial impact on local authority finances. Local authorities have to shoulder these burdens without ever being consulted as to the way in which they should foot the bill from the rates. I am not making this point facetiously or factiously; it is a matter which should be cleared up.

Photo of Mr Martin Maddan Mr Martin Maddan , Hove

It may be that the Bill will increase the burden on local authorities and that they will have to find the money from their rates, but that only makes more urgent the need to tackle the problem properly, and to decide what share of the burden shall fall upon local government and central Government finances respectively. It is not an argument for not dealing fairly with pensioners, be they local government pensioners or central Government pensioners.

Photo of Mr Thomas Price Mr Thomas Price , Westhoughton

I was not arguing that. My remarks are made in a different context. I am not putting this forward as an argument why the improvements should not be made in pensions. I support the Bill but I do not support the Amendment.

Photo of Mr Martin Maddan Mr Martin Maddan , Hove

It is this Amendment which we are talking about; I am sorry if I misunderstood the hon. Gentleman.

I wanted to ask the Financial Secretary about a statement that he made, which is very important and which should be underscored—that, while there is a pre-1957 plateau, there are some troughs in it. He then went on to say that in these troughs, in particular, are the senior civil servants.

Photo of Mr Niall MacDermot Mr Niall MacDermot , Derby North

I did not say that, with respect. I suggested that the plateau I was describing does not really apply to the senior civil servants and officers of the Armed Forces. I would be misrepresenting the facts if I suggested that it did. I said that for the great majority of the pensioners, there is a plateau, and this includes the poorer pensioners.

Photo of Mr Martin Maddan Mr Martin Maddan , Hove

The point I was going to make is that, whatever the imperfections of the Amendment which, under the rules of order, we are allowed to discuss, it will do something, if only a little, to help these people whom the Financial Secretary expressly picks out as being very unfortunately treated and worse treated than pensioners as a whole. Although the Amendment may be imperfect, that is not the fault of hon. Members on this side of the Committee.

We are discussing the fact that my hon. Friends feel bound to support the Amendment and I hope that the hon. and learned Gentleman will take note of this, unless he is able to say that he and his colleagues will remedy these injustices in another way at another stage. If he is not prepared to tackle either the problem of older pensioners or the problem that he indicated, that senior civil servants as a whole have had treatment much worse than that meted out to other pensioners, he cannot expect us to support his argument on this Amendment. We should not let this go without setting on record the fact that, at an early date and on the next available occasion—if it cannot be achieved now—the lot of the older senior civil servants must, in justice and equity, be dealt with.

Photo of Mr Reginald Paget Mr Reginald Paget , Northampton

I am very glad to see my hon. Friend the Minister of Defence for the Royal Navy present, as he is responsible for pensions for the Armed Forces generally. I am particularly glad that he was present to hear the Financial Secretary say that this "plateau" argument upon which he rejects the Amendment does not apply to Armed Forces pensions. It certainly does not. I have figures here which show that the codes for a captain and a major before the 1949 Bill were, respectively, £560 and £777. The 1956 codes were £676, which is more than £100 more, and £844.

Equally, of course, the 16 per cent. does not apply. It is very much more important because, between 1956 and the present day, the increases are more like 30 per cent. than 16 per cent. I understand, however, that all these matters will be considered before we get the Warrant for the Forces' pay. But it must be clearly understood before that is negotiated that the arguments which support the Government on this Bill will not support them on the pay Warrant. The pay Warrant must be dealt with on a different basis and it should be understood that we must have an opportunity to do that when the Warrant comes up.

Photo of Sir Raymond Gower Sir Raymond Gower , Barry

I believe that the whole Committee was impressed by the clarity with which the Financial Secretary declared his objections to the Amendment. I was not at all clear, however, why he had to bring in two distinct arguments. First, he explained that a formidable objection was the existence of this pre-1957 plateau. He explained that in a very interesting way and it seemed possible that that argument was valid.

However, as a subsidiary argument, he then explained that there were certain overall financial objections, that the amount which could be devoted to the Bill was severely limited and that it could be done only if more money were available from the Exchequer or if other classes who would benefit under the Bill were deprived.

I was not sure whether, if the plateau argument had not existed, he would have been prepared to agree the Amendment in the face of the budgetary objections. On the other hand, I was not clear whether, if the total global financial objection had not existed, he would have agreed to the Amendment provided that there was no plateau argument. It was difficult to tell from his remarks which was the more formidable.

I agree with my hon. Friend the Member for Hove (Mr. Maddan) that, unless we have the kind of assurance which has been sought, we must support the Amendment.

Photo of Mr Eric Lubbock Mr Eric Lubbock , Orpington

In common with the hon. Member for Worcester (Mr. Peter Walker), I will say I would not have put this Amendment forward with the seriousness I did if we had been able to have any disussion on Amendments Nos. 2, 3 and 4 which, I understand, we are not allowed to discuss. I freely admit that this Amendment does not represent what we want. It is only a small part of the move towards bringing the pensions of the older pensioners somewhere near present-day levels. I am sorry but I must disagree with the Financial Secretary in what he said about the plateau and I intend to show him where he is entirely wrong on this matter by quoting some figures. I would not have wearied the House with them if the hon. and learned Gentleman had not made this spurious claim. He said that he was trying to reply to the debate when I tried to get him off the subject of the once-for-all bonus in the 1962 Bill, which I do not recall has been mentioned in this discussion.

The hon. and learned Gentleman completely ignored everything I said about the remarks by the present Chancellor of the Duchy of Lancaster during discussion of the 1962 Bill. So if he intends to reply to the debate—as perhaps he will have the courtesy to do—in a few moments, perhaps he will address himself to those quotations I gave from the right hon. Gentleman's speeches. I am sure that they are precisely the sort of sentiments which we had hoped for from the Government this evening.

It is a great disappointment to me that the Government are not prepared to accept this very small Amendment. The hon. and learned Gentleman said that they departed from a 1962 principle only in order to give the most benefit to those longest on retirement. The hon. Member cannot have been listening to my speech, because I gave the example of the postman who was mentioned by the right hon. Member for Kingston-upon-Thames (Mr. Boyd-Carpenter) who received 17s. 10d. under the 1962 proposals and who will receive 10s. 2d. under the Bill. The Minister is quite incorrect in saying that the greatest benefits have invariably been given under the Bill to those who have been retired longest.

8.30 p.m.

Photo of Mr Niall MacDermot Mr Niall MacDermot , Derby North

The hon. Member must not put words into my mouth. I did not say "invariably". He can pick a particular case of a man who benefited substantially from the special benefits conferred under the 1962 Act, which we have not repeated, and he can say that this man does not get the same benefit on this occasion. I was describing the broad picture.

Photo of Mr Eric Lubbock Mr Eric Lubbock , Orpington

I took a particular case and the hon. and learned Gentleman chose to ignore it. But if he wants it in general terms, anybody who is receiving less than £500 in pension will be worse off under these proposals than under the previous proposals.

Photo of Mr Niall MacDermot Mr Niall MacDermot , Derby North

The hon. Member is wrong. That applies only to the particular case to which he was referring—to persons over 70. But other people, instead of getting a 12 per cent. increase, are getting a 16 per cent. increase.

Photo of Mr Eric Lubbock Mr Eric Lubbock , Orpington

As we are talking about people who retired as long ago as 1950, I am justified in supposing that a very large majority of them are now over the age of 70.

Photo of Mr Eric Lubbock Mr Eric Lubbock , Orpington

I did not say that a great many are not; I said that a large majority are. Perhaps the hon. and learned Gentleman would care to produce some figures. He does not like this because he does not like arguments which do not suit his case. I am saying that many people did better under the Tory Act than under this Measure, and that is incontrovertible.

I promised to deal with the argument about the plateau of those who retired before 1957. He said that it was not exactly a level plateau because it did not apply at the higher levels. I have here a graph which has been constructed from an Answer by the hon. and learned Gentleman to a Question on 19th January, 1965, and reported in col. 4 of the OFFICIAL REPORT. It shows differences in the amounts payable to persons who retired at a given date compared with their colleagues who retired in 1964. The hon. and learned Gentleman can see for himself that it is not a plateau. It looks like a roller coaster. There are very great differences indeed in the pensions paid, and I could give many examples. These differences are between the pensions of persons who retired at a given date, shown along the bottom of the graph, and their equivalents who retired in 1964.

Photo of Mr Niall MacDermot Mr Niall MacDermot , Derby North

The hon. Member is seeking to support his argument with figures for those who retired in 1964, but the issue which we are discussing is whether those who retired before 1951 require some special treatment compared with those who retired between 1951 and 1957. Comparisons with 1964 do not help.

Photo of Mr Eric Lubbock Mr Eric Lubbock , Orpington

The hon. and learned Member should see the slope of this graph. It is the same all the way along. I will give him some detailed figures of pensions of those who retired in 1950, compared with those who retired in 1957. I do not see how he can possibly pretend that this constitutes a plateau. The difference between a clerical officer who retired on 31st March, 1949, and a clerical officer who retired on 31st March, 1957 —these figures come from his own Answer on 19th January—is £28. For an executive officer it is £41, for a higher executive officer is £65, for a senior executive officer it is £66, for a principal it is £93 and for an assistant secretary it is £199. How the hon. and learned Member can possibly pretend that this is a plateau is past understanding.

The answer to him is given in the claim of his right hon. Friend the Chief Secretary to the Treasury that parity for 1956 would cost £11 million. It can cost £11 million only if there are a great many people who retired before 1956 who are receiving pensions substantially lower than those of people who retired at that date. The hon. Member cannot have it both ways. Either he should reconsider the figure of £11 million which was given by the Chief Secretary on Second Reading or he should confess that the pensions of those who retired a long time before 1956 are very much lower than the pensions of those who retired at that date. There may be a few instances of a clerical officer who retired in 1939 receiving £360 whereas his counterpart who retired in 1949 receives only £344, but that Is tolerable, because the person who retired in 1939 has had very much longer to live on this small amount of pension than has his colleague who retired ten years later.

Photo of Mr Thomas Price Mr Thomas Price , Westhoughton

I warn the hon. Member that the argument of parity which he is pursuing is a very dangerous argument. If it is pursued to its logical conclusion he must take all factors into account. If the argument of parity is to be pursued into such fine detail, I ask him to remember that there are eight million British citizens who have no pension. Their situation ought to be a subject for comparison. All the talk about parity is so much hypocrisy if he forgets that, apart from the State pension, eight million people in this country have no pension at all. I am getting tired of this argument.

Photo of Mr Eric Lubbock Mr Eric Lubbock , Orpington

The hon. Gentleman had to make that intervention because it was his hon. Friends who spent a whole night talking to prevent any discussion on the Bill which had been presented by the hon. Member for Abingdon (Mr. Neave) in the last Session. If he really believes so strongly that non-pensioners should be given National Insurance Pensions as of right, I hope that he will have an opportunity very soon of matching his deeds to his words because I understand that another hon. Member is taking over the Bill which was originally presented by the hon. Member for Abingdon. I trust that it will have the support of the hon. Member for Westhoughton (Mr. J. T. Price) when it comes up for Second Reading. I am rather surprised, Sir Leslie, at your tolerance in allowing me to answer that intervention.

Photo of Mr Leslie Thomas Mr Leslie Thomas , Canterbury

If the hon. Member is objecting to my tolerance he can sit down forthwith if he wishes.

Photo of Mr Eric Lubbock Mr Eric Lubbock , Orpington

I was thanking you, Sir Leslie, for giving me an opportunity to reply to the point raised by the hon. Member for Westhoughton, who really must not try to get the Committee on to a subject which is not relevant to the Bill. In any case, to say that because we have not done anything for non-pensioners we should exclude the claims of the people we are now discussing and who retired before 1950 is a spurious argument.

I will merely end by saying that the Financial Secretary made an extremely feeble speech which will be read with dismay by people who retired before 1950 and who will wish us to go into the Division Lobby immediately.

Photo of Mr Reginald Paget Mr Reginald Paget , Northampton

Might I, first, have an assurance from the Financial Secretary in regard to Service pensioners?

Photo of Mr Niall MacDermot Mr Niall MacDermot , Derby North

My hon. and learned Friend the Member for Northampton (Mr. Paget) has asked me for an assurance about Service pensioners, but I do not think that it would be in order for me to give him it. I thought that he was seeking to prepare the ground for an argument which he wanted to build in a later debate, to which my right hon. Friend who represents the Ministry of Defence would reply. However, I do not think that my hon. and learned Friend would be on very sure ground. The broad plateau to which I referred exists, I assure him, for the great majority of Service pensioners. As I said, it is not so for the officers.

The hon. Member for Hove (Mr. Maddan) was seeking from me an assurance that we would introduce a special measure into the Bill designed to meet the special cases of what are, on the whole, the better-off pensioners—the higher Civil Service and officers in the Forces. I could not give him any such assurance and can only point out that the party of which he is a member introduced several pension Measures and, apart from general increases, were able to give, in different Measures, benefits to particular classes of pensioners but that they did not single out a class for special treatment. Now, in Opposition—where they are likely to remain for long years —we hear hon. Gentlemen opposite, as we did on Second Reading, giving a bold pledge, one which they had not costed, to the effect that they were going to introduce parity to 1956 to benefit this class which they did not single out for special benefit up till now.

I was asked by the hon. Member for Orpington (Mr. Lubbock) a number of questions. One was the explanation of the Chief Secretary's reference to the fact that parity to 1956 would cost upwards of £11 million. The point is that by far the greatest part of that benefit would, for the reason I have given, under such a Measure go to the better-off pensioners. It was the effect of the provisions in the earlier, post-war Acts that there was a maximum limit of increase which could be given and so it was the poorer pensioners who, on the whole, benefited most proportionately from those earlier Acts. That is the historical reason why this general plateau does not apply to pensioners who retired from the most senior grades.

My hon. Friend the Member for Westhoughton (Mr. J. T. Price) asked about the amount of the cost which would fall on local authorities. He is perfectly correct. Upwards of £5 million of the total cost will fall on the rates out of the total cost in terms of public expenditure of just over £25 million.

Hon. Members:

Oh.

Photo of Mr Peter Walker Mr Peter Walker , Worcester

I can well understand hon. Members opposite shouting "Oh" when I rise, but after what the Financial Secretary has said one is provoked to do so. That he should talk in front of his hon. and learned Friend the Member for Northampton (Mr. Paget) about the promises we are now making for pensions increases is a matter of great courage on his part. He knows that in what was said by his hon. and learned Friend and by the Chairman of the Labour Party in almost every debate on the Pensions (Increase) Bill of 1962, promises were made that remain completely unfulfilled in this present Measure.

Photo of Mr Martin Maddan Mr Martin Maddan , Hove

As the Financial Seccretary has referred to What I have said, I shall say something back. As my hon. Friend the Member for Worcester (Mr. Peter Walker) has pointed out, just because something was not done in 1962 is no reason for saying that it must never be done at all. At least in all the Acts up to then progress had been made in dealing with these various anomalies. Secondly, in the manner in which the hon. and learned Gentleman referred to these more senior civil servants his implication was that as these people were better off it did not matter that their standard of living was being eroded. The Financial Secretary shakes his head—will he say whether he thinks that it does matter?

Photo of Mr Niall MacDermot Mr Niall MacDermot , Derby North

The hon. Member cheapens, shall I say, the intervention, because he knows perfectly well that he is trying to put in my mouth something that I never said. I did not in the least say that it did not matter. I said that when we are considering to which classes any additional benefit above the average should be given, I was rather surprised to find the hon. Member suggesting that this particular class should be singled out in comparison with others. I would remind him that these senior civil servants are getting a larger percentage increase in this Bill than in any previous Bill.

Photo of Mr Martin Maddan Mr Martin Maddan , Hove

Mr. Maddan rose——

Photo of Mr Leslie Thomas Mr Leslie Thomas , Canterbury

Order. I think that the hon. Member for Hove (Mr. Maddan) has had a pretty good innings.

Question put, That those words be there inserted:—

The Committee divided: Ayes 132, Noes 169.

Division No. 6]AYES[8.42 p.m
Agnew, Commander Sir PeterFletcher-Cooke, Charles (Darwen)Murton, Oscar
Alison, Michael (Barkston Ash)Foster, Sir JohnNugent, Rt. Hn. Sir Richard
Astor, JohnFraser, Ian (Plymouth, Sutton)Onslow, Cranley
Atkins, HumphreyGardner, EdwardPage, John (Harrow, W.)
Awdry, DanielGlover, Sir DouglasPage, R. Graham (Crosby)
Baker, w. H. K.Goodhart, PhilipPearson, Sir Frank (Clitheroe)
Balniel, LordGower, RaymondPeel, John
Barlow, Sir JohnGrant, AnthonyPeyton, John
Batsford, BrianGresham Cooke, R.Pounder, Rafton
Bell, RonaldGriffiths, Peter (Smethwick)Powell, Rt. Hn. J. Enoch
Bennett, Dr. Reginald (Cos. & Fhm)Gurden, HaroldPrior, J.M. L.
Berry, Hn. AnthonyHall-Davis, A. G. F.Pym, Francis
Biffen, JohnHarris, Frederic (Croydon, N.W.)Quennell, Miss J. M.
Bingham, R, M.Harris, Reader (Heston)Ramsden, Rt. Hn. James
Black, Sir CyrilHarrison, Brian (Maldon)Ridley, Hn. Nicholas
Box, DonaldHarrison, Gol. Sir Harwood (Eye)Ridsdale, Julian
Boyd-Carpenter, Rt. Hn. J.Harvey, Sir Arthur Vere (Macclesf'd)Roots, William
Boyle, Rt. Hn. Sir EdwardHastings, StephenRoyle, Anthony
Brinton, Sir TattonHawkins, PaulRussell, Sir Ronald
Bromley-Davenport, Lt.-Gol. Sir WalterHeald, Rt. Hn. Sir LionelSharpies, Richard
Brown, Sir Edward (Bath)Hendry, ForbesSmith, Dudley (Br'ntf'd & Chiswick)
Buchanan-Smith, AlickHornby, RichardStainton, Keith
Bullus, Sir EricHornsby-Smith, Rt. Hn. Dame P.Stanley, Hn. Richard
Buxton, RonaldHowe, Geoffrey (Bebington)Stodart, Anthony
Carr, Rt. Hn, RobertHutchison, Michael ClarkStudholme, Sir Henry
Chataway, ChristopherJenkin, Patrick (Woodford)Taylor, Edward M.(G'gow,Cathcart)
Chichester-Clark, R.Kershaw, AnthonyTaylor, Frank (Moss Side)
Cole, NormanKilfedder, James A.Temple, John M.
Cooke, RobertKirk, PeterThatcher, Mrs. Margaret
Costain, A. P.Kitson, TimothyThomas, Rt. Hn. Peter (Conway)
Craddock, Sir Beresford (Spelthorne)Legge-Bourke, Sir HarryTurton, Rt. Hn. R. H.
Crosthwaite-Eyre, Col. Sir OliverLloyd, Rt. Hn. Selwyn (Wirral)Vaughan-Morgan, Rt. Hn. Sir John
Crowder, F. P.Longbottom, CharlesWaltler, David (High Peak)
Curran, CharlesLongden, GilbertWalker, Peter (Worcester)
Currie, C. B. H.MacArthur, IanWeatherill, Bernard
Davies, Dr. Wyndham (Perry Barr)Mackie, George Y. (C'ness & S'land)Webster, David
Dean, PaulMaddan, W. F. M.Whitelaw, William
Deedes, Rt. Hn. W. F.Maginnis, John E.Williams, Sir Rolf Dudley (Exeter)
Dodds-Parker, DouglasMaudling, Rt. Hn. ReginaldWills, Sir Gerald (Bridgwater)
Doughty, CharlesMaxwell-Hyslop, R. J.Wilson, Geoffrey (Truro)
Eden, Sir JohnMills, Stratton (Belfast, N.)Wolrlge-Gordon, Patrick
Elliot, Capt. Walter (Carshalton)Miscampbell, NormanWylie, N. R.
Elliott, R. W. (N'c'tle-upon-Tyne, N.)Mitchell, David
Errington, Sir EricMore, JasperTELLERS FOR THE AYES:
Farr, JohnMunro-Lucas-Tooth, Sir HughMr. Eric Lubbock and
Mr. David Steel.
NOES
Abse, LeoBraddock, Mrs. E. M.Davies, Ifor (Gower)
Albu, AustenBray, Dr. JeremyDavies, S. O. (Merthyr)
Allaun, Frank (Salford, E.)Brown, Rt. Hn. George (Belper)de Freitas, Sir Geoffrey
Alldritt, WalterBrown, Hugh D. (Glasgow, Provan)Delargy, Hugh
Armstrong, ErnestBuchanan, RichardDell, Edmund
Bacon, Miss AliceButler, Herbert (Hackney, C.)Dempsey, James
Bagier, Gordon A. T.Carmichael, NeilDoig, Peter
Barnett, JoelCarter-Jones, LewisDonnelly, Desmond
Bence, CyrilChapman, DonaldDuffy, Dr. A. E. P.
Benn, Rt. Hn. Anthony WedgwoodColeman, DonaldDunn, James A.
Bennett, J. (Glasgow, Bridgeton)Conlan, BernardDunnett, Jack
Binns, JohnCraddock, George (Bradford, S.)Ensor, David
Blackburn, F.Crawshaw, RichardEvans, Albert (Islington, S.W.)
Blenkinsop, ArthurCullen, Mrs, AliceEvans, Ioan (Birmingham, Yardley)
Boardman, H.Dalyell, TamFernyhough, E.
Boston, TerenceDarling, GeorgeFitch, Alan (Wigan)
Bowden, Rt. Hn. H. W. (Lelcs S.W.)Davies, G. Elfed (Rhondda, E.)Fletcher, Ted (Darlington)
Boyden, JamasDavies, Harold (Leek)Fletcher, Raymond (Ilkeston)
Floud, BernardMcCann, J.Roberts, Goronwy (Caernarvon)
Foley, MauriceMacDermot, NiallRobertson, John (Paisley)
Fraser, Rt. Hn. Tom (Hamilton)Mclnnes, JamesSheldon, Robert
Galpern, Sir MyerMackie, John (Enfield, E.)Short, Rt. Hn. E. (N'c'tlc-on-Tyne, C.)
Garrett, W. E.Mahon, Peter (Preston, S.)Silkin, S. C. (Camberwell, Dulwich)
Garrow, AlexManuel, ArchieSkeffington, Arthur
Gourlay, HarryMapp, CharlesSmall, William
Greenwood, Rt. Hn. AnthonyMaxwell, RobertSnow, Julian
Gregory, ArnoldMayhew, ChristopherSpriggs, Leslie
Grey, CharlesMillan, BruceStones, William
Griffiths, Rt. Hn. James (Llanelly)Miller, Dr. M. S.Strauss, Rt. Hn. G. R. (Vauxhall)
Hamilton, James (Bothwell)Milne, Edward (Blyth)Swingler, Stephen
Hamilton, William (West Fife)Morris, Charles (Openshaw)Symonds, J. B.
Hamling, William (Woolwich, W.)Murray, AlbertTaylor, Bernard (Mansfield)
Hannan, WilliamNeal, HaroldThomas, George (Cardiff, W.)
Harrison, Walter (Wakefield)Newens, StanThomas, lorwerth (Rhondda, W.)
Hazell, BertNorwood, ChristopherTinn, James
Heffer, Erie S.Oakes, GordonTomney, Frank
Hobden, Dennis (Brighton, K'town)Ogden, EricTuck, Raphael
Horner, JohnO'Malley, BrianUrwin, T. W.
Houghton, Rt. Hn. DouglasOram, Albert E. (E. Ham, S.)Varley, Eric G.
Howell, Denis (Small Heath)Orme, StanleyWainwright, Edwin
Howie, W.Oswald, ThomasWalker, Harold (Doncaster)
Hoy, JamesOwen, WillWatkins, Tudor
Hunter, Adam (Dunfermline)Padley, WalterWeitzman, David
Hunter, A. E. (Feltham)Paget, R. T.Wellbeloved, James
Hynd, John (Attercliffe)Palmer, ArthurWhitlock, William
Johnson, Carol (Lewisham, S.)Park, Trevor (Derbyshire, S.E.)Wilkins, W. A.
Johnson, James (K'ston-on-Hull, W.)Pavitt, LaurenceWilliams, Alan (Swansea, W.)
Jones, Dan (Burnley)Pearson, Arthur (Pontypridd)Williams, Clifford (Abertillery)
Jones, J. Idwal (Wrexham)Popplewell, ErnestWilliams, Mrs. Shirley (Hitchin)
Jones, T. W. (Merioneth)Prentice, R. E.Willis, George (Edinburgh, E.)
Kenyon, CliffordPrice, J. T. (Westhoughton)Winterbottom, R. E.
Lawson, GeorgeProbert, ArthurWoodburn, Rt. Hn. A.
Lever, L. M. (Ardwick)Pursey, Cmdr. HarryZilliacus, K.
Lewis, Ron (Carlisle)Randall, Harry
Lomas, KennethRees, MerlynTELLERS FOR THE NOES:
Loughlin, CharlesRhodes, GeoffreyMrs. Harriet Slater and
Mabon, Dr. J. DicksonRichard, IvorMr. Joseph Harper.
McBride, NeilRoberts, Albert (Normanton)

Photo of Mr Leslie Thomas Mr Leslie Thomas , Canterbury

Amendments Nos. 2, 3 and 4 on the Order Paper have not been selected and we shall therefore proceed to Amendment No. 5.

Photo of Mr Eric Lubbock Mr Eric Lubbock , Orpington

On a point of order. Do I understand, Sir Leslie, that you have not selected Amendment No. 2, in page 1, line 25, at end insert: Provided that any person who retired earlier than 1st April 1956 shall be deemed to have retired on 1st April 1956 for the purposes of this Act. and Amendment No. 3, in line 25, at end insert: Provided that in the case of a person who retired before 1st January 1956 the increase shall be not less than a sum sufficient to make his pension equal to the pension that would have been payable to him if he had retired on 1st January 1956. as well as Amendment No. 4, which has been mentioned previously? Is that because they are out of order under the terms of the Money Resolution?

Photo of Mr Leslie Thomas Mr Leslie Thomas , Canterbury

I have not selected them. They are out of order because they are quite outside the scope of the Money Resolution.

Photo of Mr Peter Walker Mr Peter Walker , Worcester

I beg to move Amendment No. 5, in page 2, line 5, at the end, to insert: except that for the word 'sixty' in subsections (2)(a) and (3)(a) there shall be substituted the word fifty-five' The object of the Amendment is simple. It is to ensure that those public service pensioners who retired before the age of 60 enjoy the benefits of the Bill at the age of 55 instead of waiting until the age of 60. As the Committee will be aware, there are a number of occupations—for example, the police service and the fire service—and the Bill also indirectly affects the Armed Services—where people retire before 60, having completed their service. They do not get any benefit from the Bill until the age of 60 is reached.

The Committee must decide, therefore, where they are deserving cases, whether they have a right to receive these increases and one has to argue the purpose of these Pensions (Increase) Measures. The purpose is not just elimination of hardship. If it was just that it would be done probably by supplementary pensions, by National Assistance, or in some other way. The purpose of the Bill is to see that pensions keep pace with the rise in the cost of living and in the general prosperity of the community.

For example, a police officer who completed his service at the age of 50 and retired in 1956 or 1957 will not on 1st January obtain any increase whatever under the Bill and he will have to wait a year or two until he reaches the age of 60 before he benefits in any way. But, during the interim, he will have to suffer the rise in the cost of living. During the past year, public service pensioners under the age of 60 will have had their pensions reduced by about 1s. in the £ as a result of the rise in the cost of living since this Government came in, but they will receive no compensation for this under the Bill. This is one of the reasons why we move this Amendment to substitute the age of 55.

Adoption of the age of 55 will mean that the gap between retirement and the time when public service pensioners enjoy the benefit of these increases will, for the majority of them, be considerably diminished, and it will also cover that particular group of pensioners who find it difficult to secure other employment at the age of 55. The more elderly a person is, the more difficult he finds it to obtain appropriate employment. Adoption of this Amendment would, therefore, be of particular assistance to Service personnel finishing their service at the age of 54 or 55 who find great difficulty in securing other remunerative employment. They will have the advantage of the increases provided by our Pensions (Increase) Acts.

This is a matter of importance not only for the people directly concerned but also for recruitment in the various public services. Many of our police forces are grossly under establishment today, and this is particularly so in the Metropolitan Police District where the measure of the increase in crime is very much related to the problems of police recruitment. One of the advantages that the police service can offer to attract recruits is the pension provisions, but these pension provisions become far less attractive when a police officer can complete a very long period of service and then at the end not obtain this benefit from Pensions (Increase) Acts for another number of years.

This point should carry favour with the Treasury under the leadership of the pre- sent Chancellor because no one can be more aware of the problems of the police service than the right hon. Gentleman as he was for many years consultant to the Police Federation. He will know what a serious bone of contention it is in the police service that these increases do not apply to police pensioners. I hope, therefore, that the Financial Secretary will be able to avoid a long debate by at once accepting the Amendment.

Photo of Mr Reginald Paget Mr Reginald Paget , Northampton

I have often argued that, when the State enters into a bargain, it should make that bargain good in good money since it controls the money. I argued that often when I sat on the opposite benches. My personal interest is in the Armed Services, and I have Service men in mind as a guide to what happens to a man in this context. Members of the Armed Services were men who joined on the basis of a bargain as to pay, and part of that bargain was retired pay. For them, it is not a pension at all; it is retired pay. They accepted considerably lower rates of pay than the similar grades in civil employment because of the pension benefits.

9.0 p.m.

It is not a question of need or want. It is a question of a bargain being honoured or not being honoured. Therefore, it seems to me that if one does not make good in real money the bargain that one has made, one is not treating one's public servants honestly. I thought that on Second Reading the Economic Secretary accepted that argument, but he said—I think there was considerable weight in it—that it is true that it would not be decent or good employer behaviour to pay a pension of less purchasing power than the pension which one bargained to pay, hut, after all, one has to consider all the pensions that one pays and in this case we have very considerably increased the National Insurance pension, and that has to be taken into consideration, for public service pensioners are receiving pensions of better purchasing power than the pensions which we bargained to pay them.

That seems to me to be a perfectly good argument, but it is hardly a sincere argument if one does not apply it to people who do not get National Insurance pensions, and we are talking about precisely that class. These people at 55 are not getting the National Insurance pension, they are not getting the increased pension, and they are not, I should have thought, on any reckoning getting what they bargained for or what they expected for the service which they rendered. This is certainly very strongly their view. This class of pensioner feels that he has been swindled. That is a very serious factor in regard to recruitment.

The most fertile field of recruitment was always the Service family—for officers, N.C.Os and privates. They were families which, years and years, generations and generations, joined one of the Services. Now there have been planted in those families a number of anti-recruiting officers, who are saying to the men growing up, "Look how the Army treated me", and we are not getting recruits from those families.

This is a very serious problem. I do not know the police situation as well as I know the Army situation, but I should have thought that when one sees the crime rate, when one sees the progressive victory of the criminal over the law—which we see year after year—when we see it becoming more and more established that crime does pay, it must be clear that the loss of recruits, and the right sort of recruits, from the right sort of family, with the right sort of background, is very serious for the police forces. However, I would point out that the Service position of earlier retirement is very much more difficult, and requires different consideration.

Photo of Captain Walter Elliot Captain Walter Elliot , Carshalton

My impression is—and I think it to be right—that many more people from the public services, including the Armed Services, continue working in one job or another after retirement today than was the case some decades ago. No doubt it is also true that a man retiring at 60 perhaps is not quite so likely to take another job as one retiring at 55. However, I still believe that far more public servants take other jobs after retirement than was the case a few decades ago. It is on that principle, I believe, that the Government are limiting the increase to the age of 60 and after, as opposed to the age of 55. I cannot think of any other reason.

But, at whatever age a public servant retires, whether he works or not afterwards, the importance of the pension to him should not be underestimated. If a public servant is able to work in his normal career free from anxiety as to his financial future when he retires, at whatever age that is, I believe that he will work more efficiently. If he thinks that, when he retires at 55 or 60, he will not be able to support his family, if they have not grown up, or live reasonably, then he begins to worry about it and to concern himself during his active career about what he will do.

He may start—many of them do—training himself for another job. He may work late after he has finished his ordinary day's work and I believe that affects his efficiency in his normal career. This is the only point I wish to make but it is important. I hope that the Government will accept the Amendment for this and the other reasons put forward.

Photo of Dr Reginald Bennett Dr Reginald Bennett , Gosport and Fareham

I endorse what has been said, notably by the hon. and learned Member for Northampton (Mr. Paget), from a certain amount of first-hand knowledge of precisely the anti-recruiting effect that is inflicted upon the community in my constituency, which is overwhelmingly Service-minded.

Large numbers of my constituents are very indignant that pensions increase measures provide for increases which are unobtainable until some date in future. Surely, having earned a pension, a man has also earned the increases. This has been a way of short-changing our Service men, both civil and military, which must be ended. The Amendment will do so and I strongly support it.

Photo of Mr Paul Dean Mr Paul Dean , Somerset North

I was a little surprised by what my hon. and gallant Friend the Member for Carshalton (Captain W. Elliot) said in the earlier part of his speech, because it is certainly my impression that the sort of people about whom we are now thinking, those who have retired at the age of 50 or thereabouts, in spite of the shortage of labour are finding increasing difficulty in getting alternative employment when they retire.

We are dealing with people who of necessity retire comparatively early, the Armed Forces, who retire between 40 and 50;the fire services, who also retire fairly early; the police who retire at 50 or thereabouts; and the overseas public servants who retire in their early or mid-fifties. These people retire early necessarily because of the nature of their employment, or because of the difficult climate in which they have been working. It has been my impression that many of them have found it extremely difficult to get other employment, and, if they are 55 or more, it is virtually impossible for them to get other employment which carries a pension with it. In these cases they will have to wait an average of 10 years after retirement before they can hope for any increase under the pensions increase arrangements. Those are strong arguments for reducing the age to 55.

Photo of Sir Albert Costain Sir Albert Costain , Folkestone and Hythe

These people retire at an early age because their jobs necessitate their retiring at an early age. They take their appointments in the belief that they are doing a service and will get a pension. If the job warrants their retiring at an early age, why should we differentiate against them because the employer—the Government—demands that they should retire? Surely it is unfair for the Government to say, "We as employers ask you to retire because you are too old", and then not put them on a different pension basis. I am sure that the Financial Secretary, as a good employer, will appreciate that they are entitled to any increases which are due to any other pensioner.

Photo of Mr Niall MacDermot Mr Niall MacDermot , Derby North

I would point out to the hon. Member for Folkestone and Hythe (Mr. Costain) that the Amendment is not confined to those who retire at an early age, but is a broad Amendment proposing that all public service pensions increases should become payable at the age of 55. It would apply equally to those who retired before 55 as well as those retiring at that age.

Hon. Members who have had the misfortune to listen to my winding-up speech on Second Reading will not hope for any help from the Government on this Amendment, because I then gave the reasons why we were unable to accept the proposals, which arose on Second Reading, for an alteration of the age from 60 to 55. If it were not disrespectful to the Committee, I could say that I referred hon. Members to what I said at column 1456.

We at the Treasury constantly have to bring hon. Members back to the matter of cost. The cost of this proposal would be £5 million, a very large sum. I remind hon. Members of what I said in that connection in the debate on the previous Amendment. If we were to grant this concession, within the limits of the sums available there would have to be a very substantial reduction in the percentage increases which have been awarded. If we completely cut out the two top steps, the 14 per cent. and the 16 per cent., and said that everybody must receive only the 12 per cent. increase, that still would not provide enough funds to make room for this Amendment. The needs of those who have retired longer are much greater than this need, and that consideration goes to the root of the matter.

9.15 p.m.

The hon. and gallant Member for Carshalton (Captain W. Elliot), with his great fairness in debate, which I have come to respect, pointed out the crux of this matter, namely, that fortunately today those who retire early—and they are primarily people in the Forces, the police and the fire service—are able to obtain other employment and do so. The hon. Member for Worcester (Mr. Peter Walker) who moved this Amendment, said that the purpose of pensions increase measures was not the relief of hardship. All I can say is that all of his hon. Friends who have introduced previous pensions increase measures have said that that was the purpose of the Measure. We have come to accept the doctrine of relative hardship as well as the doctrine of absolute hardship. Therefore, we have to compensate not only the poorest pensioners, but also the better-off pensioners, who have suffered the relative hardship of a reduction in the value of their pension.

We must face the fact, when dealing with some pensioners, that they may take other employment and may be able, by this means, to offset by their earnings the evils of inflation, which is what underlies the whole of these pensions increase measures. Surely they cannot be regarded as the most deserving cases, and the people who should be given the treatment asked for in this Amendment, at the cost and expense of giving a substantially smaller increase to those who have been longest in retirement. Quite clearly it is a matter of national policy that we must give encouragement to people who retire early to find other work, and to help the manpower gap. So far as this Amendment would provide a disincentive to that, it would be contrary to an important part of our national policy.

Photo of Dr Reginald Bennett Dr Reginald Bennett , Gosport and Fareham

The hon. and learned Gentleman's argument is fair in so far as he deploys it, but does he think that it is fair and equitable that people have to retire from Service life which may have been arduous, and are then compelled to look for jobs because they are not being paid the full pension, plus its increases, to which they are absolutely entitled by their work?

Photo of Mr Niall MacDermot Mr Niall MacDermot , Derby North

If "compelled" is the word, I do not know, but certainly the people who retire aged 40 to 50, if they are fit and healthy and able to work, should be given every inducement to seek work. It is in their own and the national interest that they should do so. If they are not able to work, then they become entitled to pension increases under other provisions. For this reason I must urge the Committee to reject the Amendment.

Photo of Sir Ronald Bell Sir Ronald Bell , Buckinghamshire South

We have found that a not surprising and a disappointing answer. It has certainly not persuaded anyone on this side of the Committee. As to what the hon. and learned Gentleman was saying at the end of his speech in justification for not accepting this Amendment, how can he really argue that a person retiring at the age of 50, is in a position to find work of a fully remunerative character, which will enable him to offset the damage caused by inflation to the value of his pension? This sort of argument about the person who is in current employment not suffering from deflation is a valid argument for those who are in the full working years of life.

But by definition this Amendment can only apply to those who have retired with an entitlement to a pension precisely because the work they did, whether in the police, the fire service, the overseas services or the Armed Forces, was such that it was considered that they would have exhausted the value of their skill in active service by the time they reached that age. If they worked overseas they would have reached a degree of physical exhaustion which they would not have reached in a temperate climate. This is not a case of sickness or of being unable to work. It is a case of being past the full vigour of life. That is the point which the hon. and learned Gentleman is neglecting to take fully into account. The hon. and learned Gentleman said in his speech that it was right that those who retired, and were on pension before 40 and 50 years of age should do a good day's work and should be encouraged to do so. I do not dissent from that, but the Amendment applies to the age of 55, not to the age group 40–50 to which the hon. and learned Gentleman referred. I do not know whether that was a slip of the tongue, but that was what he said.

Several of my hon. Friends have said that this is a difficulty in the pensions system which undoubtedly has and will have its effect upon recruitment for these services, whether it be the Civil Service actually affected by the Bill, or the Armed Forces indirectly affected. Recruitment, whether it is for the police, for the fire services or for the Armed Forces, is not a matter to which the hon. and learned Gentleman can be indifferent. We on this side are certainly not indifferent to it.

In the case of the ordinary home Civil Service I believe the position to be this. Though a man may retire before the age of 60, he receives no pension; it is put into suspense until he becomes 60. Therefore, for those people the Bill is perfectly tailored, as its predecessors have been. It is exactly designed to meet the needs of the home Civil Service, because they could not be benefited by any provision in a Pensions (Increase) Act which affected anybody below the age of 60. No doubt that is why the age of 60 has from the beginning appeared in those Acts.

This neglects the position, to which we have drawn attention and to which the hon. and learned Member for Northampton (Mr. Paget) has drawn attention, of the people in those services which are different from the home Civil Service and who, in every case, retire at an earlier age than 60, though it varies between the Armed Forces, from which an officer may come out at the age of 48, and the police, from which he is more likely to retire at a considerably older age, though still under 60.

The Financial Secretary might have said—for all I know, he said it in column 1456, to which he so kindly referred—that he is carrying on the system which we used in our Pensions (Increase) Acts. We particularly prided ourselves on introducing progressive improvements in each of those Acts. We had the initial increases all round the scale. We had the £20 for those over 70, and so on. What improvement is the hon. and learned Gentleman introducing?

Photo of Mr Niall MacDermot Mr Niall MacDermot , Derby North

I will tell the hon. Gentleman—a step of 14 per cent.; a step of 16 per cent., two additional steps, higher increases than have ever been given before. We are extending it to classes of pensioners, in a number of respects dealt with in Clauses which we shall come to later, who were not covered by previous Bills. The hon. Gentleman is so full of his own proposals that he has failed to ignore what is in the Bill.

Photo of Sir Ronald Bell Sir Ronald Bell , Buckinghamshire South

The hon. and learned Gentleman is a little infelicitous in his language tonight. I know that he meant the opposite of "failed to ignore", but never mind; the effect was understood. What the hon. and learned Gentleman managed to reel off with considerable facility was a number of minor Amendments of degree and not a radical improvement all round, which is what we are concerned-with. The

view which we on this side hold is that, after the improvements which we made in our Bills, the outstanding improvements which need to be made are, first, to bring the pensions of all concerned up to the 1956 level and, secondly, to introduce the improvement which is the subject matter of the Amendment, namely, to bring the age for benefit under the Pensions (Increase) Acts down to 55. We are very sorry indeed that the Government do not take the same interest in this as we do. The hon. and learned Gentleman even referred us to his speech on Second Reading, as though that were an adequate way of dealing with an Amendment such as this.

The party opposite takes a much keener interest in the whole subject of pensions at election time than it does at twenty minutes past nine in the evening in Committee on the Bill, when the quorum is provided only by this side—[Interruption.] Hon. Gentlemen opposite come in from all sorts of remote parts of the building when there is a Division, but they have not got enough interest in the proceedings to listen to them.

We regard the Amendment as one of great importance, on which we have received a totally unsatisfactory answer from the Financial Secretary, and therefore we intend to press this to a Division. I invite my hon. Friends to join me in the Lobby.

Question put, That those words be there inserted:—

The Committee divided: Ayes 134, Noes 165.

Division No. 7.]AYES[9.25 p.m.
Agnew, Commander Sir PeterBuxton, RonaldFoster, Sir John
Alison, Michael (Barkston Ash)Carr, Rt. Hn. RobertFraser, Ian (Plymouth, Sutton)
Allan, Robert (Paddington, S.)Chataway, ChristopherGlover, Sir Douglas
Astor, JohnChichester-Clark, R.Goodhart, Philip
Atkins, HumphreyClark, Henry (Antrim, N.)Gower, Raymond
Awdry, DanielCole, NormanGrant, Anthony
Baker, W. H. K.Cooke, RobertGresham Cooke, R.
Balniel, LordCostain, A. P.Griffiths, Peter (Smethwick)
Barlow, Sir JohnCraddock, Sir Beresford (Spelthorne)Grimond, Rt. Hn. J.
Batsford, BrianCrosthwaite-Eyre, Col. Sir OliverGurden, Harold
Bell, RonaldCrowder, F. P.Hall-Davis, A. G. F.
Bennett, Dr. Reginald (Gos. & Fhm)Curran, CharlesHarris, Reader (Heston)
Berry, Hn. AnthonyCurrie, G. B. H.Harrison, Brian (Maldon)
Biffen, JohnDavies, Dr. Wyndham (Perry Barr)Harrison, Col. Sir Harwood (Eye)
Bingham, R. M.Dean, PaulHarvey, Sir Arthur Vere (Macclesf'd)
Black, Sir CyrilDeedes, Rt. Hn. W. F.Hastings, Stephen
Box, DonaldDoughty, CharlesHawkins, Paul
Boyd-Carpenter, Rt. Hn. J.Eden, Sir JohnHeald, Rt. Hn. Sir Lionel
Boyle, Rt. Hn. Sir EdwardElliot, Capt. Walter (Carshalton)Hendry, Forbes
Brinton, Sir TattonEmery, PeterHornby, Richard
Bromley-Davenport, Lt.-Col. Sir WalterErrington, Sir EricHowe, Geoffrey (Bebington)
Brown, Sir Edward (Bath)Eyre, ReginaldHutchison, Michael Clark
Buchanan-Smith, AlickFarr, JohnJenkin, Patrick (Woodford)
Bullus, Sir EricFletcher-Cooke, Charles (Darwen)Joseph, Rt. Hn. Sir Keith
Kershaw, AnthonyOnslow, CranleyStudholme, Sir Henry
Kilfedder, James A.Page, John (Harrow, W.)Taylor, Edward M. (G'gow, Cathcart)
King, Evelyn (Dorset, S.Page, R. Graham (Crosby)Taylor, Frank (Moss Side)
Kirk, PeterPearson, Sir Frank (Clitheroe)Temple, John M.
Kitson, TimothyPeel, JohnThatcher, Mrs. Margaret
Legge-Bourke, Sir HarryPeyton, JohnThomas, Rt. Hn. Peter (Conway)
Longbottom, CharlesPounder, RaftonTurton, Rt. Hn. R. H.
Longden, GilbertPowell, Rt. Hn. J. EnochVaughan-Morgan, Rt. Hn. Sir John
Lubbock, EricPrior, J. M. L.Walder, David (High Peak)
MacArthur, IanPym, FrancisWalker, Peter (Worcester)
Mackie, George Y. (C'ness & S'land)Quennell, Miss J. M.Weatherill, Bernard
Maddan, W. F. M.Ramsden, Rt. Hn. JamesWebster, David
Maginnis, John E.Ridley, Hn. NicholasWhitelaw, William
Maudling, Rt. Hn. ReginaldRidsdale, JulianWilliams, Sir Rolf Dudley (Exeter)
Maxwell-Hyslop, R. J.Roots, WilliamWills, Sir Gerald (Bridgwater)
Mills, Stratton (Belfast, N.)Royle, AnthonyWilson, Geoffrey (Truro)
Miscampbell, NormanRussell, Sir RonaldWolrige-Gordon, Patrick
Mitchell, DavidSharples, RichardWylie, N. R.
More, JasperStainton, Keith
Munro-Lucas-Tooth, Sir HughStanley, Hn. RichardTELLERS FOR THE AYES:
Murton, OscarSteel, David (Roxburgh)Mr. R. W. Elliott and
Nugent, Rt. Hn. Sir RichardStodart, AnthonyMr. Dudley Smith.
NOES
Abse, LeoGarrow, AlexOswald, Thomas
Albu, AustenGourlay, HarryOwen, Will
Allaun, Frank (Salford, E.)Greenwood, Rt. Hn. AnthonyPadley, Walter
Alldritt, WalterGregory, ArnoldPalmer, Arthur
Armstrong, ErnestGrey, CharlesPark, Trevor (Derbyshire, S.E.)
Bacon, Miss AliceGriffiths, Rt. Hn. James (Llanelly)Pavitt, Laurence
Bagier, Gordon A. T.Hamilton, James (Bothwell)Pearson, Arthur (Pontypridd)
Barnett, JoelHamilton, William (West Fife)Popplewell, Ernest
Bence, CyrilHamling, William (Woolwich, W.)Prentice, R. E.
Benn, Rt. Hn. Anthony WedgwoodHannan, WilliamPrice, J. T. (Westhoughton)
Bennett, J. (Glasgow, Bridgeton)Harrison, Walter (Wakefield)Probert, Arthur
Binns, JohnHazell, BertPursey, Cmdr. Harry
Blackburn, F.Heffer, Eric S.Randall, Harry
Bienkinsop, ArthurHobden, Dennis (Brighton, K'town)Rees, Merlyn
Boardman, H.Homer, JohnRhodes, Geoffrey
Boston, TerenceHoughton, Rt. Hn. DouglasRichard, Ivor
Bowden, Rt. Hn. H. W. (Leics S.W.)Howell, Denis (Small Heath)Roberts, Albert (Normanton)
Boyden, JamesHowie, W.Roberts, Goronwy (Caernarvon)
Braddock, Mrs. E, M.Hoy, JamesRobertson, John (Paisley)
Bray, Dr. JeremyHunter, Adam (Dunfermline)Sheldon, Robert
Brown, Rt. Hn. George (Belper)Hunter, A. E. (Feltham)Short, Rt. Hn. E.(N'c'tle-on-Tyne,C.)
Brown, Hugh D. (Glasgow, Provan)Hynd, John (Attercliffe)Silkin, John (Deptford)
Carmichael, NeilJohnson, Carol (Lewisham, S.)Silkin, S. C. (Camberwell, Dulwich)
Carter-Jones, LewisJohnson, James (K'ston-on-Hull,W.)]Skeffington, Arthur
Chapman, DonaldJones, Dan (Burnley)Small, William
Coleman, DonaldJones, J. Idwal (Wrexham)Snow, Julian
Conlan, BernardJones, T. W. (Merioneth)Spriggs, Leslie
Craddock, George (Bradford, S.)Kenyon, CliffordStones, William
Crawshaw, RichardLawson, GeorgeStrauss, Rt. Hn. C. R. (Vauxhall)
Cullen, Mrs. AliceLever, L. M. (Ardwick)Swingler, Stephen
Dalyell, TamLewis, Ron (Carlisle)Symonds, J. B.
Darling, GeorgeLomas, KennethTaylor, Bernard (Mansfield)
Davies, G. Elfed (Rhondda, E.)Loughlin, CharlesThomas, George (Cardiff, W.)
Davies, Harold (Leek)Mabon, Dr. J. DicksonThomas, lorwerth (Rhondda, W.)
Davies, Ifor (Gower)McBride, NellTinn, James
Davies, S. O. (Merthyr)McCann, J.Tomney, Frank
Delargy, HughMacDermot, NiallTuck, Raphael
Dell, EdmundMclnnes, JamesUrwin, T. W.
Dempsey, JamesMackie, John (Enfield, E.)Varley, Eric G.
Doig, PeterMahon, Peter (Preston, S.)Wainwright, Edwin
Duffy, Dr. A. E. P.Manuel, ArchieWalker, Harold (Doncaster)
Dunn, James A.Mapp, CharlesWatkins, Tudor
Dunnett, JackMayhew, ChristopherWeitzman, David
Ensor, DavidMillan, BruceWellbeloved, James
Evans, Albert (Islington, s. w.)Miller, Dr. M. S.Whitlock, William
Evans, Ioan (Birmingham, Yardley)Milne, Edward (Blyth)Wilkins, W. A.
Fernyhough, E.Morris, Charles (Openshaw)Williams, Alan (Swansea, W.)
Fitch, Alan (Wigan)Murray, AlbertWilliams, Clifford (Abertillery)
Fletcher, Ted (Darlington)Neal, HaroldWilliams, Mrs. Shirley (Hitchin)
Fletcher, Raymond (Ilkeston)Newens, StanWillis, George (Edinburgh, E.)
Floud, BernardNorwood, ChristopherWinterbottom, R. E.
Foley, MauriceOakes, GordonWoodburn, Rt. Hn. A.
Fraser, Rt. Hn. Tom (Hamilton)Ogden, EricZilliacus, K.
Freeson, ReginaldO'Malley, Brian
Galpern, Sir MyerOram, Albert E. (E. Ham, S.)TELLERS FOR THE NOES:
Garrett, W. E.Orme, StanleyMrs. Harriet Slater and
Mr. Joseph Harper.

Question proposed, That the Clause stand part of the Bill.

Photo of Dr Reginald Bennett Dr Reginald Bennett , Gosport and Fareham

We have discussed the detailed provisions of the Clause and have not had very satisfactory answers. One point which gives me a great deal more concern and alarm in connection with the Bill than has yet been brought out is the problem of how we are to know that these increases will be received by those entitled to them. As we came into the Chamber this afternoon—those of us who came in at the beginning—we came across a document published by the Treasury, the Department of which the hon. and learned Gentleman the Financial Secretary is so distinguished an ornament, which says: The arrangements previously announced are cancelled in respect of Rhodesia in regard to travel, wages and salaries, and contractual payments such as pensions, interest and dividends. It goes on to say: So far as Her Majesty's Government itself is concerned, money due to residents of Rhodesia for pensions or interest on Government Stocks will be held back for the time being, and will be released as soon as normal relations can be resumed. British firms and others with similar obligations to Rhodesia are advised to adopt a similar procedure. It was only on 18th November, that the hon. and learned Gentleman was asked by my hon. Friend the Member for St. Ives (Mr. G. R. Howard) about pensioners resident in Rhodesia and he replied: It is intended that pensioners who are covered by the Bill and who are resident in Rhodesia should continue to receive their pensions and to receive the increases under the Bill. The machinery is likely to be that a Rhodesia account will be established in London. Pension paying Departments should send payable orders which can be drawn on this account, direct to the pensioners through the post. The pensioners will then, we hope, be able to cash the orders at their local banks, which will clear the transaction with the account in London, and appropriate instructions are being issued to the pension paying Departments."—[OFFICIAL REPORT. 18th November, 965 Vol. 720, c. 1464.] I was shocked by this new turn of events, but I am sure that I and other hon. Members were nothing like so shocked as the would-be recipients of Government pensions in Rhodesia this afternoon.

It seems to me that they are being left absolutely to sink. Surely this is not the way in which to apply a Pensions (Increase) Bill. These are now being with- held indefinitely from people who, by definition, live on only small regular weekly or monthly contributions. What steps is the hon. and learned Gentleman taking to see that these pensions are paid to these people and not cancelled or withheld indefinitely? He is responsible for the sustenance of these pensioners. He and his colleagues are responsible and nobody else. Only he can give us the assurance we require.

Photo of Mr Niall MacDermot Mr Niall MacDermot , Derby North

The hon. Member has raised the question—

Photo of Mr Thomas Price Mr Thomas Price , Westhoughton

On a point of order. Before the Financial Secretary replies to the hon. Member for Gosport and Fareham (Dr. Bennett), I would ask whether it is in order for the hon. Member to raise this matter in the way he has just done. There is no reference whatever, I would submit, on the rules of order which cover this debate, that a British citizen, whether he is resident in this country or in any part of the world, can lose his civil rights for almost all reasons, for a multiplicity of reasons, as my hon. Friend the Financial Secretary will very quickly explain to the Committee. [HON. MEMBERS: "Order."] I am making this submission now on a point of order. [HON. MEMBERS: "You are not."] Of course. The Chairman will tell me when I am out of order, not hon. Members opposite. I am making a serious submission to the Chair that the point raised, with the special provisions announced today by the Prime Minister—[HON. MEMBERS: "Order."]—would have been within the knowledge of the hon. Gentleman if he had been in the House when the Prime Minister was speaking. I submit that this is quite out of order and that the debate ought not to be allowed to continue.

Photo of Sir Douglas Glover Sir Douglas Glover , Ormskirk

Further to that point of order. Surely this must be in order. The increases in these pensions presumably would go to people in Rhodesia, but under the Government's embargo they will not get the money. It must be in order to debate this matter.

Photo of Mr Ernest Armstrong Mr Ernest Armstrong , North West Durham

Further to that point of order. Surely the question would arise in connection with anyone in one of Her Majesty's prisons, and we should not be entitled to raise that in the debate. This must be out of order.

Photo of Mr Roderic Bowen Mr Roderic Bowen , Cardiganshire

I was in some doubt whether the hon. Member for Gosport and Fare-ham (Dr. Bennett) was in order in raising the matter. He asked for information, and apparently the Financial Secretary is willing and ready to help the Committee in this respect. In those circumstances I allowed him to raise the matter, and I call upon the Financial Secretary to reply.

Photo of Mr Niall MacDermot Mr Niall MacDermot , Derby North

This is a point of interest to the Committee and I expected to be asked the question in the course of the evening. I am prepared to answer it.

The hon. Member for Gosport and Fareham (Dr. Bennett) raised the question of the position of public service pensioners resident in Rhodesia. On Second Reading I told the House what was then our intention and hope, which was that pensioners resident in Rhodesia would continue to receive their pensions. I described the procedure which would enable them to do so. Since then, as the hon. Member knows, there have been serious developments in Rhodesia, as a result of which my right hon. Friend the Prime Minister made a statement this afternoon referring to a number of financial measures, in addition to other measures, which are being taken. One of them is that we are introducing measures which go further than those previously in operation and a stop is being placed on practically all current payments by United Kingdom residents to residents of Rhodesia. This will apply to the payment of pensions by Her Majesty's Government.

There is no question of the obligation to pay these pensions being repudiated, but it cannot be fulfilled in present circumstances. I hope that hon. Members and those who are entitled to these pensions will realise where the blame lies for that fact. The money which is due to residents of Rhodesia for pensions will be held back for the time being and will be released as soon as normal relations can be resumed with Rhodesia.

Photo of Mr Peter Walker Mr Peter Walker , Worcester

We take the strongest objection to the statement which the Financial Secretary has just made. He said that we know where the blame lies. The facts of the situation were exactly the same on 18th November when the Financial Secretary with the authority of the Government, stated on Second Read- ing that public service pensioners resident in Rhodesia would receive their pensions. There are resident in Rhodesia a number of people who have served their country well and who are depending for their livelihood on pensions received from this Government—people who may well be completely out of sympathy with and opposed to the present régime in Rhodesia. The Government have now decided to cut off their means of livelihood. I consider this to be an absolute scandal and I plead with the Government to think again.

Photo of Sir Douglas Glover Sir Douglas Glover , Ormskirk

I endorse entirely what was said by my hon. Friend the Member for Gosport and Fareham (Dr. Bennett). I can think of nothing more likely to harden white opinion in Rhodesia against this country than the action which has been taken by the Government.

9.45 p.m.

We will drive an enormous number of reasonable people—because reasonable people are very much affected by their personal circumstances—in Rhodesia into taking a different attitude because many of those people who are probably at this moment anti-Smith and anti the present administration there will find that their incomes are cut off by Her Majesty's Government. They will become anti-British, and this will lend support to Smith's régime in Rhodesia. I therefore ask the Government to think again, because this is the biggest mistake they have made in a very difficult situation.

Photo of Sir Raymond Gower Sir Raymond Gower , Barry

Is not the Financial Secretary appalled by the inhumanity of this decision? [Interruption.] Hon. Gentlemen opposite may groan, but I assure them that this is inhuman. Some of the people we are discussing are extremely elderly—at the very last years of their lives—and no payment deferred can ever compensate them for payment which will now be stopped. Can it really be suggested that the cause of trying to bring Rhodesia back into—

Photo of Mr Thomas Price Mr Thomas Price , Westhoughton

On a point of order. I submit to you Mr. Bowen, that we are at the moment technically debating the Question, That Clause 1 stand part of the Bill. There is no mention in Clause 1 of Rhodesia and, therefore, in any respectful submission to the Chair, all this discussion is entirely out of order and you should stop it.

Photo of Mr Peter Walker Mr Peter Walker , Worcester

Further to that point of order. Provision is made in Clause 1 for the payment of certain increases in pensions. We are asking, I submit legitimately, whether these increases are to be paid to the pensioners to whom we are referring. We were shocked to hear from the Financial Secretary that they are not to be paid to some pensioners living in Rhodesia and I therefore submit that we have a perfect right to raise this matter.

Photo of Captain Walter Elliot Captain Walter Elliot , Carshalton

Further to that point of order. While I do not wish to make your position any more difficult, Mr. Bowen, as my hon. Friend the Member for Worcester (Mr. Peter Walker) pointed out, we are discussing an increase for public service pensioners. When a public servant enters his service he does so under certain conditions. These are clearly laid down and he accepts them. It now appears, quite arbitrarily, that those conditions can be changed. Would it be in order to call for the Attorney-General or Solicitor-General to clarify this point?

Photo of Mr Roderic Bowen Mr Roderic Bowen , Cardiganshire

I have already ruled that it is in order to discuss the arrangements in regard to the payment of pensions, in this instance in Rhodesia. However, I am not going to allow this debate to widen its scope to a discussion of the whole merits of sanctions in Rhodesia or the pension element in those sanctions.

Photo of Sir Raymond Gower Sir Raymond Gower , Barry

I will keep strictly to the matter at hand, namely, the pensions which are paid to persons who happen to be resident in Rhodesia. I plead with the Financial Secretary to reflect that some of these persons are in Rhodesia merely because they have gone to live with their next of kin, perhaps people younger than themselves. Is it not incredible that a responsible British Government could take this, I repeat, inhuman action?

I sincerely hope that, after careful reconsideration, the position as described by the Financial Secretary will be altered. The cause which the Government and the Prime Minister have professed and for which they have enjoyed a generous measure of support in all parts of the House throughout these long discussions will not be served by a measure of sheer cruelty of this kind.

Photo of Mr Niall MacDermot Mr Niall MacDermot , Derby North

As hon. Members know, the measures which were announced by my right hon. Friend the Prime Minister this afternoon and which have been published from the Treasury only this afternoon have not yet been the subject of debate or discussion in the House. I do not know what arrangements could be made, and it may be that the House will want an opportunity to consider these measures and their effects in many ways, apart from this one.

I was asked, as a sheer question of information, what would be the effect of these measures on the small number of pensioners covered by this Bill who are resident in Rhodesia. I have answered that question and, with great respect, I am not in a position to debate this matter any further. I have given the House all the information that is in my possession, and no doubt an opportunity will arise to debate this subject if need be.

I would point out that what we are now considering is the Question that Clause 1 stand part of the Bill. The Clause provides that those people should be entitled to certain increases. If hon. Members do not want the people in question to be entitled to this increase, they can vote against the Clause, but we are providing that they shall be entitled to the increase. I have given information on what will he the effect of these arrangements in regard to the receiving of immediate payment. The moneys will be held for the pensioners, and we hope to pay it to them as soon as possible.

Photo of Mr Cyril Bence Mr Cyril Bence , Dunbartonshire East

I have been amazed by some of the speeches from the other side of the Committee. We all have tremendous sympathy with these pensioners in Rhodesia, but I understand that the pensions due to them, plus the increases, will be credited to an account in London. I feel sure that the banking authorities in Rhodesia, and the present régime there, will feel very strongly about these poor people. I have no doubt that those authorities have tremendous faith in the ability of the British Government and British people and are sure that the problem will be resolved. They can, therefore, pay out the pensions in Rhodesian £s with the assurance that when things return to normal and law and order is restored they can claim on the account in London.

Photo of Captain Walter Elliot Captain Walter Elliot , Carshalton

On a point of order, Mr. Bowen, I am sorry to delay the proceedings of the Committee, but here, in the one hand, I have a Bill which says that pension increases are to be given to certain categories of public servants while, in the other hand, I have a piece of paper from the Vote Office which says that a certain category of public servants is not to receive the increases. I am in a quandary about what it means. Can all the provisions of this Bill be null and void because a piece of paper like this is issued?

Photo of Mr Roderic Bowen Mr Roderic Bowen , Cardiganshire

That is not a point of Order. I have already allowed the discussion on the merits or the demerits of stopping the payment of pensions to people in Rhodesia to become distinctly wide. This debate should not develop into a general discussion of the merits or demerits of that action.

Question put and agreed to.

Clause ordered to stand part of the Bill.

Clause 2 ordered to stand part of the Bill.