Oral Answers to Questions — Pension Schemes (Comparability)

– in the House of Commons at 12:00 am on 28th February 1977.

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Photo of Mr John MacGregor Mr John MacGregor , South Norfolk 12:00 am, 28th February 1977

asked the Minister for the Civil Service whether he will give instructions to the Pay Research Unit to undertake an examination of the current situation relating to occupational pension schemes in the private sector in order to bring up to date information on their comparability with Civil Service pension schemes.

Photo of Mr Charles Morris Mr Charles Morris , Manchester Openshaw

No, Sir. Pay research has been suspended as part of the Government's counter-inflation policy.

Photo of Mr John MacGregor Mr John MacGregor , South Norfolk

Is the Minister aware that the Government Actuary recently promised the General Sub-Committee of the Public Expenditure Committee that he would update the 1973 actuarial assumptions on which the 1·75 per cent. deduction from the fair comparisons between public and private sector pay is based? To complete the picture, is not another survey of this sort required? Will the Minister think again about the situation, because the results would help to allay the considerable public disquiet about inflation-proof pensions?

Photo of Mr Charles Morris Mr Charles Morris , Manchester Openshaw

I understand that in the last few days the Government Actuary has submitted his views to the Select Committee on Public Expenditure. The point made on pensions was only one facet of the fair comparison exercise undertaken by the PRU. The question of pay is another facet, and the topic of fringe benefits is another. One has to examine all these facets.

Photo of Mr John Ovenden Mr John Ovenden , Gravesend

Will my hon. Friend try to correct some of the misrepresentations by Opposition Members in this one-sided campaign against the Civil Service? Will he ask the PRU also to examine the perks paid to workers in private industries and compare those workers with their counterparts in the public service?

Photo of Mr Charles Morris Mr Charles Morris , Manchester Openshaw

My hon. Friend is right to draw attention to the perks enjoyed by those in the private sector who undertake much the same jobs as civil servants. We must bear in mind the fact that those who work in the private sector enjoy such perks as very low mortgage rates, interest-free loans, and many other advantages. Those perks are not available to civil servants. We also must remember that such perks in the private sector are inflation-proof.

Photo of Mr Timothy Renton Mr Timothy Renton , Mid Sussex

Does the hon. Gentleman not appreciate that there is no campaign against civil servants? Is it not important to express concern at the inflation-proofing of Civil Service pensions when, this year, price inflation looks tragically like rising to a figure of 20 per cent? Will he examine that situation?

Photo of Mr Charles Morris Mr Charles Morris , Manchester Openshaw

The hon. Gentleman has questioned me on every occasion at Question Time when we have dealt with the subject of the Civil Service. I bear in mind his assurance that no campaign is intended. Pensions indexing is a fac- for that the Government have under constant review. We reviewed the matter last year and the year before that, and we shall be reviewing the indexing of pensions this year, too.

Photo of Mr Ian Wrigglesworth Mr Ian Wrigglesworth , Teesside Thornaby

Despite the Opposition protests, is it not a fact that a campaign has been waged by the Tory and Liberal Parties against Civil Service pensions? Is it not true that the Conservative Party was responsible for introducing the inflation-proof scheme, against the wishes of the trade unions, whose members wanted pensions to be linked to increases in wages?

Photo of Mr Charles Morris Mr Charles Morris , Manchester Openshaw

My hon. Friend is right. The 1 million retired public pensioners, those drawing Armed Forces pensions, the police, and members of the nursing profession, must wonder what they have done to deserve such a campaign as is being waged against them. Let me put the statistics on the record. I refer to the provisions that civil servants have forgone in terms of direct contributions for pension benefits. In the first place, in terms of comparisons we must remember the offset of Civil Service pay—

Photo of Mr Norman Tebbit Mr Norman Tebbit , Waltham Forest Chingford

Are the Minister's answers inflation-proof?

Photo of Mr Charles Morris Mr Charles Morris , Manchester Openshaw

I thought the Opposition were anxious to extend their knowledge of the factors related to Civil Service conditions and pensions. [HON. MEMBERS: "Too long".] Very well. I shall make the information available in the Official Report.