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Women (Retirement Age)

– in the House of Commons at 3:31 pm on 27th February 1986.

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Photo of John Prescott John Prescott Shadow Secretary of State, Shadow Secretary of State for Employment 3:31 pm, 27th February 1986

(by private notice) asked the Paymaster General if he will make a statement on the ruling yesterday of the European Court of Justice on Britain's compulsory retirement age for women.

Photo of Kenneth Clarke Kenneth Clarke Paymaster General (HM Treasury), Secretary of State for Employment

We are studying the implications of the judgment of the European Court of Justice yesterday in the Marshall case. The court has decided clearly that a general policy operated by an employer concerning dismissal which involves the dismissal of a woman solely because she had attained or passed the qualifying age for a state pension, where this was different for men and women, constituted discrimination on the ground of sex contrary to a directive accepted by the United Kingdom in 1976. The judgment establishes that that directive can be relied upon by any employee of a state authority.

The Government's Sex Discrimination Bill is being considered today on Second Reading in another place. We will be considering urgently whether any amendments should be made to that Bill to clarify the law and to comply with the directive in the light of this judgment.

I should make it clear that the directive and the judgment have no application to the determination of the qualifying age for state retirement pension purposes as this is expressly excepted by another European directive.

Photo of John Prescott John Prescott Shadow Secretary of State, Shadow Secretary of State for Employment

The House will be grateful for the Paymaster General's statement. It has made it clear that he is considering the possibility of using the Sex Discrimination Bill to correct the ruling of the European court. As the ruling applies only to the public sector, will the Paymaster General make it clear that any changes that he has in mind will be equally applicable to the private sector and to public sector industries that are presently being privatised by legislation which is before the House, and that none of those workers is discriminated against by the process of privatisation?

Does the right hon. and learned Gentleman agree that the ruling provides an opportunity to harmonise public sector practice? Mrs. Marshall was forced into early retirement at the age of 60, but apparently that does not apply to other public employees such as judges and the Prime Minister. Does the Paymaster General accept that this is the time for a radical reassessment of the common pension age, as recommended by the Social Services Select Committee, as a contribution to reducing mass unemployment, which has once again been announced to be at a record high level? The House would welcome action in that regard rather than a fiddling of the unemployment figures, which is what the Government spend so much time doing.

Photo of Kenneth Clarke Kenneth Clarke Paymaster General (HM Treasury), Secretary of State for Employment

As the hon. Gentleman says, the judgment has left a little unclear the status of private sector employees. The court has not resolved that matter. We shall have to consider that. The Sex Discrimination Bill may give us an opportunity to do so.

Before the judgment, we believed that we were complying with the directive, which was accepted by the previous Labour Government. They thought that the legislation that they introduced complied with the directive. We shall have plenty of time to consider these issues as the Bill makes its way through Parliament.

As for public sector practices, employment policies such as this and whether employees will be required to retire remain matters for individual employers. Not all public sector employers have the same practice. My recollection is that not all health authorities have the same practice, and this was a health authority. The ruling makes it clear that any policy of an employer should not discriminate between men and women. If there is a requirement to retire at a set age, it should be the same for both sexes.

I have already said that the judgment has no implications—no direct effect, anyway—for the commencing age for retirement pension. That has been expressly excepted by other directives. It has of course been considered by the Government recently. The House will be aware that we raised the matter in the Green Paper on pensions policy. In the White Paper we stated: The Government's aim remains that of increased flexibility. We will continue to examine possible ways of moving towards the decade of retirement. That is a suggestion that there should be more individual choice at what age people, whatever their sex, might retire between the ages of 60 and 70. The practical problems remain unsolved.

Photo of Mr Edward Gardner Mr Edward Gardner , Fylde

Does my right hon. and learned Friend agree that more and more people in the country are becoming fed up with having critical domestic problems which affect a vast number of people and touch the pocket of every taxpayer decided in the European court? Does he agree that the time has come when the European Convention on Human Rights should be incorporated into domestic law so that these cases can be decided by British judges in British courts?

Photo of Kenneth Clarke Kenneth Clarke Paymaster General (HM Treasury), Secretary of State for Employment

I know that such feelings are quite strong. I have to point out to my hon. and learned Friend that it was not the European Court of Human Rights but the European Court of Justice which was involved. It arises from European Community commitments accepted by the previous Government who agreed to this directive and legislated, believing that they complied with it.

Photo of Mr Richard Wainwright Mr Richard Wainwright , Colne Valley

Will the Paymaster General accept that the judgment of the European court should come as no surprise whatever to those who have paid attention to the recommendations of our own Equal Opportunities Commission? When the Government are considering what to do about this judgment, will the Paymaster General undertake that they will pay particular attention to the 1·7 million working women who do not have an entitlement to pension at 60 because their pension rights depend upon the age of their husbands?

Photo of Kenneth Clarke Kenneth Clarke Paymaster General (HM Treasury), Secretary of State for Employment

I have said that the judgment did not come as a great surprise to me. Before it got to the court, the British advocate-general, a very distinguished one, had already ruled that this was likely to be the case. This House passed sex discrimination legislation believing that we were complying with the directive. Therefore, I rather agree with the hon. Gentleman's comments.

The questions of retirement policy have been considered by the House and have been put forward for public debate by the Government in the Green Paper. They are being considered at present in the discussions on the Social Security Bill.

Photo of Mr Robert McCrindle Mr Robert McCrindle , Brentwood and Ongar

Remembering that many occupational pension schemes are now moving to an earlier and common retirement date, should we not grasp the opportunity of this judgment by the European court and begin either to move towards a common retirement date, perhaps 62½ moving in half yearly periods upwards and downwards respectively for women and men, or to think in terms of the flexible retirement age to which my right hon. and learned Friend has referred, accepting that, if we were to do that, at least for a period, men who retired earlier would probably have to accept a pro rata reduction? Do we not take powers under the Social Security Bill now going through Parliament to move precisely in this directon?

Photo of Kenneth Clarke Kenneth Clarke Paymaster General (HM Treasury), Secretary of State for Employment

My hon. Friend is taking me back into extremely interesting areas which are the responsibility of my right hon. Friend the Secretary of State for Social Services. As I said a moment ago, the Government canvassed in the Green Paper which we produced on pensions policy and social security reform the question whether it might be possible to move over to a more flexible system of retirement based on individual choice. In the response which the Government received, nobody solved the extremely difficult problems and nobody came up with any solution that would demand instant support in the House or anywhere else. In the White Paper the Government have made it clear that we are still reviewing policy in this area.

Photo of Mrs Renée Short Mrs Renée Short , Wolverhampton North East

The Select Committee proposed that the Government should move towards a flexible retirement age of 63 for both sexes within a reasonable time. That proposal was also included in the White Paper. Why did not the Minister include that proposal in the Bill which is now in Standing Committee? Would not that have been the easiest way to deal with it?

Photo of Kenneth Clarke Kenneth Clarke Paymaster General (HM Treasury), Secretary of State for Employment

If I were in the hon. Lady's position, I should probably take this opportunity to raise my views on retirement policy. However, I have to make it clear that the judgment of the European court has no bearing upon the qualifying age for retirement pensions in this country.

Photo of Mrs Edwina Currie Mrs Edwina Currie , South Derbyshire

Does my right hon. and learned Friend agree that for many people this judgment will be very welcome? Many of us would indeed like our male colleagues to be given the opportunity to be equal with us and to be able to retire earlier. Does my right hon. and learned Friend also agree that retirement does not necessarily mean a pension? If we are all to have a generous pension for the many years in which we hope to enjoy retirement, we will have to pay a lot more for our pensions.

Photo of Kenneth Clarke Kenneth Clarke Paymaster General (HM Treasury), Secretary of State for Employment

I, too, welcome this judgment in some ways. The feeling about arbitrary retirement ages is growing, particularly among those in many industries who are approaching retirement age. However, there is, by law, no set retirement age in this country. That matter has to be decided by employers and employees. There is a qualifying age at which somebody is free to retire and obtain a state retirement pension. That is a very difficult matter which is best discussed in connection with legislation that is the responsibility of my right hon. Friend the Secretary of State for Social Services.

Photo of Harriet Harman Harriet Harman Shadow Minister (Health)

What action will the Secretary of State take to make sure that this decision is understood and acted upon by those who are responsible for public sector employees at local level so that the benefits of this decision can be seen and taken up straight away?

Photo of Kenneth Clarke Kenneth Clarke Paymaster General (HM Treasury), Secretary of State for Employment

I hope that the House will allow me a little more time in which to consider with care all of the detailed implications of the judgment. I expect that most public sector employers will now be reviewing their policies. If their policies lay down a set retirement age that is different, as between men and women, they should anxiously be reviewing those policies as quickly as possible.

Photo of Mr William Clark Mr William Clark , Croydon South

Will my right hon. and learned Friend first remind the House of the cost to the Exchequer if there were to be a common retirement age of 60 for both men and women? Secondly, will he tell the House what the saving would be if there were to be a common retirement age of 65?

Photo of Kenneth Clarke Kenneth Clarke Paymaster General (HM Treasury), Secretary of State for Employment

I am trying to avoid answering questions on social security matters, but I do not think that my right hon. Friend would object to my saying that those who believe that this question will be solved by reducing the state retirement pension age for men from 65 to 60 are ignoring its quite horrendous cost, which would be unacceptable in any foreseeable circumstances.

Photo of Ann Clwyd Ann Clwyd , Cynon Valley

In view of the humiliating number of cases that have been taken from this country to the European Court of Justice and the vast number of judgments against this country, is it not time for a complete review of the sex discrimination laws?

Photo of Kenneth Clarke Kenneth Clarke Paymaster General (HM Treasury), Secretary of State for Employment

I am delighted to be able to tell the hon. Lady that I hope that the Sex Discrimination Bill will receive its Second Reading today in the House of Lords. My right hon. and noble Friend is to present it there. It gives us the happy opportunity to review all of these questions. The background to this judgment is that in 1976 the previous Labour Government accepted a European directive. The Sex Discrimination Act was passed in either 1975 or 1976 which, it was believed, complied with the directive. We have discovered as a result of the judgment of the European court that we have to review our position.

Photo of Mr Teddy Taylor Mr Teddy Taylor , Southend East

Does not this judgment demonstrate in art appalling way the extent of our loss of sovereignty, since this foreign court can implement above our heads a directive which has never been discussed for one minute in the House of Commons and which entirely ignores domestic legislation that we passed to implement it in our own way? Bearing in mind what has happened, will the Minister and his colleagues be very careful indeed about the single European Act which will further erode our right to control the flow of regulations and directives out of the Common Market by majority vote?

Photo of Kenneth Clarke Kenneth Clarke Paymaster General (HM Treasury), Secretary of State for Employment

I shall look at the parliamentary record to see whether the draft directive of 1975 was considered by this House, and also to see how much debate there was on the Sex Discrimination Act 1975 and whether my hon. Friend took part in the debate when we believed that we were complying with this directive. The fact is that another Bill is now starting in another place. Although I would not encourage my hon. Friend to make lengthy speeches on it when the Bill reaches the House of Commons, he will have every opportunity to do so, and we shall be able to consider all those matters then. This directive was accepted by a British Government, and we believed that it had been complied with by the British Parliament now has every opportunity to review it in legislation that is going through the House.

Photo of Mr Robert Maclennan Mr Robert Maclennan , Caithness and Sutherland

The Minister has been at pains to describe the limitations of the judgment, but does he believe that it is appropriate to make a commitment to a flexible and equal retirement age and not to interpret the judgment in the most restrictive way?

Photo of Kenneth Clarke Kenneth Clarke Paymaster General (HM Treasury), Secretary of State for Employment

Unlike some other countries, we do not have a retirement age in the way that the hon. Gentleman suggests. Each employer and his employees are free to determine the retirement age of their occupation. The court has ruled that it is sex discrimination to have a different age for men from that of women. This House determines in legislation, which is not my responsibility, at what age men and women qualify for a state retirement pension. Once that age is passed, it is up to them to decide whether they wish to retire and take the pension or to stay in employment. I am told that one in five women between the ages of 60 and 65 are in employment.

Photo of Mr Toby Jessel Mr Toby Jessel , Twickenham

How is the judgment likely to affect the decision of one of my constituents, who, in 1972 at the age of 46, claimed to have changed from a man to a woman? [Interruption.]

Photo of Mr Bernard Weatherill Mr Bernard Weatherill , Croydon North East

Order. That is an important and technical matter.

Photo of Mr Toby Jessel Mr Toby Jessel , Twickenham

As it was ruled by Mr. Deputy Speaker, the hon. Member for Woodspring (Sir P. Dean), the then Parliamentary Under-Secretary of State for Health and Social Security, that no decision need be taken until the age of 60 was attained, and as that is now imminent, why has the European court prolonged the confusion of my constituent? Should not the court have considered that first?

Photo of Kenneth Clarke Kenneth Clarke Paymaster General (HM Treasury), Secretary of State for Employment

I doubt whether my hon. Friend's constituent had his or her retirement pension in mind as the main consideration when making that unusual decision a few years ago. I am delighted to say that when the time comes to decide whether he or she qualifies for a retirement pension at the age of 60, it will not be my responsibility but that of my right hon. Friend the Secretary of State for Social Services.

Several Hon. Members:

rose——

Photo of Mr Bernard Weatherill Mr Bernard Weatherill , Croydon North East

Order. A private notice question is an extension of Question Time.