House of Commons (Members' Salaries)

– in the House of Commons at 4:11 pm on 25th November 1992.

Alert me about debates like this

Photo of Miss Betty Boothroyd Miss Betty Boothroyd Speaker of the House of Commons 4:11 pm, 25th November 1992

We now come to motion No. 1 on Members' salaries. May I remind the House that I have selected the amendment standing in the name of the right hon. Member for Manchester, Wythenshawe (Mr. Morris)?

Photo of Mr Bob Cryer Mr Bob Cryer , Bradford South

On a point of order, Madam Speaker. A question arises over the absence of the Register of Members' Interests. During the debate, as in other debates, hon. Members will have to declare their financial interests outside the House. However, page 386 of "Erskine May" says:

"So far as voting in the House or a committee is concerned, and for this purpose only, the recording of an interest in the Register of Members' Interests is by itself regarded as sufficient disclosure"

to follow the resolution of June 1975 requiring disclosure. As no register is available, it is not open to hon. Members to rely on that.

Therefore, I ask you, Madam Speaker, to guide the House and to suggest to hon. Members that, on this occasion when we are dealing with Members' salaries, hon. Members who take part in the debate should actually declare the amount of their outside earnings, and that, if any hon. Member should so wish to do, they make their position clear on a point of order because there is no Register of Members' Interests, which is entirely due to the incompetence or ill will of the Government. That might help to remedy the position sketched out on page 386 of "Erskine May".

Photo of Miss Betty Boothroyd Miss Betty Boothroyd Speaker of the House of Commons

I expect all hon. Members who speak in the debate to declare their interests, but I cannot expect hon. Members to declare the amount of that interest. Should they wish to do so, of course they are perfectly at liberty so to do. It does not, of course, in a debate such as this, affect the way in which an hon. Member votes in the Division Lobby. I would expect hon. Members to declare their interests in the usual way.

Photo of Mr Tony Newton Mr Tony Newton , Braintree 4:23 pm, 25th November 1992

I beg to move, That the following provision should be made with respect to the salaries of Members of this House—

  1. (a) the salaries of Members not falling within paragraph (b) shall, in respect of service in 1993, be £30,854; and
  2. (b)the salaries of Officers of this House and Members receiving a salary under the Ministerial and other Salaries Act 1975 or a pension under section 26 of the Parliamentary and other Pensions Act 1972 shall, in respect of service in 1993, be £23,227.
I do not need to detain the House for a speech of great length. The motion is clear in content and in intention. It deals with 1993 only, and it provides for all hon. Members to receive the same pay next year as this. Thus, the full parliamentary salary would remain at the level in force since January 1992 of £30,854. That will also be the case for Members of the European Parliament, who are paid the same as Members of the House.

The motion specifically includes all those in receipt of a reduced parliamentary salary, because they also receive an official salary under the Ministerial and Other Salaries Act 1985. That covers all Ministers, the Leader of the Opposition and his Chief Whip and Deputy Chief Whip, and those whom the Act describes as Officers of the House —Madam Speaker, the Chairman of Ways and Means and both you, Madam Deputy Speaker, and the other Deputy.

The motion also includes those receiving a reduced parliamentary salary because they are also in receipt of a pension under section 26 of the Parliamentary and Other Pensions Act 1972, although the only person covered by that part of the motion is my right hon. Friend the Member for Old Bexley and Sidcup (Sir E. Heath), the Father of the House, as a former Prime Minister who is still a Member of the House.

Photo of Dr Norman Godman Dr Norman Godman , Greenock and Port Glasgow

Have any representations been made by MEPs on that matter? What power have they to resist such a regulation?

Photo of Mr Tony Newton Mr Tony Newton , Braintree

I have taken steps to ensure that the position is known. The hon. Gentleman will know that it has been well established that the pay of MEPs is linked to that of Members of Parliament, and I think that that is understood and accepted by all concerned.

The reduced parliamentary salary for Ministers will remain at the level in force since January 1992, which is £23,227.

For completeness, although it does not arise directly from the motion, I should of course add that, as my right hon. Friend the Chancellor of the Exchequer made clear in his autumn statement, Ministers will also not receive an increase in their official ministerial salary in 1993. As Madam Speaker is already aware, I can confirm that the Government will not be bringing forward for 1993 an order under the Ministerial and Other Salaries Act 1975. So, for all those in receipt of the reduced parliamentary salary, there will also be no increase in 1993 in their official salaries.

The House is well aware of the context in which these propositions are put before it, and I will therefore touch on them only briefly. The Government's policy as regards public sector pay was clearly set out by my right hon. Friend the Chancellor in his autumn statement. Settlements in the year ahead across the whole of the public sector will be constrained within the range 0 per cent. to 1·5 per cent.

As my right hon. Friend made clear, restraint in current expenditure, of which pay forms so large a part, is a necessary condition of our ability to direct resources at areas of spending which should rightly have priority, including spending on capital projects. Only by exercising restraint on current expenditure can the inescapable pressures elsewhere in spending programmes be accommodated, and capital spending in particular be given the emphasis widely urged, while keeping to our published plans for public spending as a whole. Those plans form part of a coherent and responsible fiscal and economic strategy, and they were debated and endorsed by the House last week.

Photo of Mr Archy Kirkwood Mr Archy Kirkwood Liberal Democrat Chief Whip

Can the right hon. Gentleman tell the House what amount will be saved to the Treasury if the motion is passed?

Photo of Mr Tony Newton Mr Tony Newton , Braintree

The hon. Gentleman will be well aware that the sum involved is small. For reasons that I shall touch on, our recommendation is important.

Photo of Mrs Elaine Kellett Mrs Elaine Kellett , Lancaster

Was that not a remarkably trivial intervention from the Liberal Benches? It is the principle that is at stake and not the actual cash.

Photo of Mr Tony Newton Mr Tony Newton , Braintree

I am grateful to my hon. Friend. It is clear that we believe that it is right—I sense that she believes so too—for the Government and the House to give a lead in exercising restraint. I am grateful to the many hon. Members who have indicated their support for that view by signing early-day motion 834.

Photo of Mr Joe Ashton Mr Joe Ashton , Bassetlaw

Is the right hon. Gentleman aware that I would support him and vote for the motion if he could guarantee that the cash which should have gone to my pay rise would go to Oxfam or the National Society for the Prevention of Cruelty to Children and not to the Treasury. If not, I shall vote against it.

Photo of Mr Tony Newton Mr Tony Newton , Braintree

I am grateful to the hon. Gentleman for what he said in the first half of his intervention. The Government have looked at what could be spent in certain areas of public expenditure, including those to which the hon. Gentleman referred, and we felt that it was right to ask for the exercise of restraint on forms of current expenditure, including the pay that is under debate. In that sense, it could be said that that request is part of a range of decisions that have enabled more money to be spent in ways that the hon. Gentleman might prefer.

Hon. Members would expect me to say something about the Government's view of what should happen in future years. It has become clear that, in any event, a new resolution would be likely to have been needed because of the substantial changes that have taken place in the structure of civil service pay arrangements with the move to a much greater emphasis on performance-related pay.

The existing resolution defines Members pay in terms of 89% of the rate which on I January in that year represents the maximum point on the main national pay scale for Grade 6 officers in the Home Civil Service, or if that scale ceases to exist, on the scale which for the time being replaces it (disregarding, in either case, any discretionary pay point on that scale)". The last point, which is in parenthesis, is particularly important in this context because, by comparison with the previous structure, which provided a scale maximum and a higher range maximum—access to which was discretionary and performance related—the new structure, which has been in place since last August, no longer has a scale maximum, but a pay range defined by minimum and maximum points, with no fixed points in between. Individuals' pay within that range depends entirely on annual assessments of performance. In other words, in relation to the resolution passed by the House in 1987, the word "maximum" has, in effect, changed its meaning—having previously specifically excluded performance-related payments, it now includes such payments, and at the highest possible level.

In those circumstances, there appear to be two possible interpretations of the existing resolution. One is that it has simply become inoperable, with the result that it would provide no power for Members to have any pay at all, let alone an increase. The other is that its references to excluding performance-related pay should be ignored. That would produce an increase of more than 20 per cent. While there can be little doubt which interpretation the House would have preferred, I think there will be few who would wish to argue that that would have been an appropriate outcome, against the current economic background.

In the light of this, and the fact that, in any event, we cannot know how any civil service pay settlement next year will affect the performance element of the new structure —that structure is in a state of transition itself—the Government's clear recommendation to the House is that it would be neither practical nor right to seek to decide, now, the precise terms for future linkage. That is why the resolution deals only with 1993. We should return to the position for 1994 and beyond towards the end of next year when the position is clearer. I can, however, give the House two clear assurances.

First, the Government entirely accept the case for re-establishing a clear and automatic linkage with the civil service, comparable with what the House intended when it passed the existing resolution. We have no wish to return to the situation in which the House has to decide on Members' pay each and every year. Rightly, that is, I think, a very important point for the House

. Secondly, we do not intend that Members should forgo the pay increase which civil servants already have—the 3·9 per cent. for 1992 paid in August, which would, in normal circumstances, have been expected to carry through to Members pay in January—as well as have no increase in respect of the forthcoming year. In other words, we do not intend that Members should be permanently disadvantaged by 3·9 per cent. in comparison with the civil service.

I turn lastly to pensions, about which I am aware that some concern has been expressed, and which are indeed the subject of an amendment by the right hon. Member for Manchester, Wythenshawe (Mr. Morris), to whom I shall of course listen with care.

Before making some comment on that, however, I should first make it quite clear that the motion before the House has no effect whatever on pensions already in payment. Those pensions, and the arrangements for increasing them, remain precisely as they are. Parliamentary pensions in payment, like other pensions with the same uprating formula, will increase by 3·6 per cent. from April 1993, as announced by my right lion. Friend the Secretary of State for Social Security in his uprating statement two weeks ago.

However, I recognise, of course, that the amendment is directed at a different point, which is the effect on future pensions of the proposed restraint on pay. As I have said, I shall listen to the right hon. Gentleman with care, not least because I note that his proposal does not go down the path of seeking to draw a contribution from the taxpayer, which would not be available to other groups affected by restraint, in respect of payments related to a notional salary. It provides rather for Members to be able to make additional payments entirely at their own expense, to offset the effects of restraint. Perhaps though, I might make two observations which he, the House and other Members of the fund who have put their names to his amendment may wish to bear in mind.

First, since the parliamentary pension scheme is a defined benefit scheme—that is to say, benefits are based on the salary payable at the time of retirement—and since the longer-term position will not become clear until the House has debated and decided it at a later stage, hon. Members would not find it at all easy to determine whether and to what extent they wished to take advantage of what is proposed in the amendment, without some risk of making payments which brought them no benefit. Secondly, taking account of that, it could be better to examine the alternative possibility of building on the general provisions introduced by the Government for additional voluntary contributions in pension schemes generally.

There are two ways in which that can be done. There is what is called in the occupational pension trade a free-standing additional voluntary contribution—that is, paying such contributions, which are tax-relieved within the Inland Revenue limits, to one of the many schemes available commercially. Secondly, there are AVC schemes which are provided through the occupational pension scheme, in this case the parliamentary scheme, which have advantages in simplifying administration and keeping costs down.

Should the trustees, or Members generally, feel that it would be helpful in the spirit of the amendment to explore the other possibilities more fully, I want to make it clear that I would be happy to assist. I hope that that is a constructive thought for the House and for the right hon. Gentleman. In ending with that thought, I commend the main motion to the House.

Photo of Margaret Beckett Margaret Beckett Shadow Leader of the House of Commons, Deputy Leader of the Labour Party 4:37 pm, 25th November 1992

The debate is a matter for the House of Commons as a body and for Members to make their decision on a free vote. For that reason, it is essential that, in the fairly short time allowed to us, as many hon. Members as possible should have a chance to speak. Accordingly, I shall seek to curtail my remarks.

What we are debating is not a small part of a coherent policy for pay, not even in the public sector. Like most matters to which the Government set their hand, it is a mess. Nor is the specific proposal as it relates to Members of Parliament a policy even for our pay. It is not a policy; it is a smokescreen. The Government have announced a wholly arbitrary limit for public sector pay and they hope, by including Members of Parliament in its provisions, to create an illusion of fairness and the impression that the highest paid are taking their fair share of a concept that is usually completely absent from their thinking or policy.

The highest-paid, even in the public sector, will not be affected by the proposal. Next year, the senior ranks of the civil service, judges and so on will, I understand, receive. more than Members of Parliament and more than the 1·5 per cent. which is supposed to be the general limit. We on these Benches object to the proposals for public sector pay.

During the election campaign some six months ago, the Conservative party, from the Prime Minister down, swore to the people that, because our economy was fundamentally sound, cuts in income tax could be afforded, as well as increases in public spending and improvements in public services, and that no cost-cutting measures and no revenue-raising measures, such as increases in other taxes or charges, would be needed.

Photo of Mr Rod Richards Mr Rod Richards , Clwyd North West

The hon. Lady has just said that there should not be a limit on public sector pay. Is that correct, or does she believe that there should be a limit—in which case, what does she think that limit should be?

Photo of Margaret Beckett Margaret Beckett Shadow Leader of the House of Commons, Deputy Leader of the Labour Party

There should be a proper and fair—seen to be fair—policy for working out public sector pay along the lines of the pay review bodies and other existing bodies. That is the Labour party's policy. Did the Conservative party manifesto tell people in the public sector what the Government's policy would be?

Now that the election is over, the Conservative party claims, as the hon. Member for Clwyd, North-West (Mr. Richards) just did, that public spending plans can be preserved only at the expense of pay levels and jobs in the public sector. For a married public sector worker on £10,000 a year, even an increase of 1·5 per cent. is equivalent to a reduction in income, equivalent to an increase in the basic rate of tax of 7p in the pound. So much for the argument that income tax cuts could be afforded and that there would be no penalty after the election.

Let there he no mistake: the Government's overall proposals will mean not pay cuts to save jobs, but pay cuts and job losses. It is no accident that the proposal for Members' salaries is not for a 1·5 per cent. increase—as many hon. Members thought after the first publicity—in place of the increase in payment from last August for the civil service grade with which our pay is linked, but for a pay freeze. A freeze is exactly what the Government's proposals imply for many low-paid workers in the public sector.

Local authorities have costed the effects on their pay bill of pay awards for the police, the fire service, the teaching profession and other services, already made and in payment. The combined effect of those existing awards and other employment costs leaves local authorities some £200 million short of the money that they already need to meet next year's pay bill—that is without an increase under the formula. With universal capping of expenditure, job and service cuts are likely to have to be made to balance the books.

Moreover, we already know that, where incremental pay scales are in place, by law those increments must and will be paid. if funding is geared to 1·5 per cent. of the total bill, increments for some will mean a pay freeze for others. That is why Members of Parliament are to have a pay freeze. If we had been given 1·5 per cent. and it later emerged that many public sector workers were facing a pay freeze, the Government would rightly be accused of sleight of hand on their own pay.

That is why I cannot support the Government motion tonight. Members of Parliament are being used not to set an example but as a stalking horse. It is not only in the matter of a freeze that I fear that we are being used to help set a precedent that I deplore. By moving the motion, the Government are breaking, at least temporarily, a linkage with a particular civil service grade. The House has voted for the principle of a linkage on no less than three occasions—a vote and a principle which the Government finally and reluctantly accepted.

Opposition Members are well aware that the history of the Government's term of office shows that there is nothing that they would like better than to break every pay formula and linkage, and to dissolve every pay review body and every independent and fair system of pay assessment in the public and private sectors. They would love to move away from any form of national pay bargaining or concept of a rate for the job. They tried repeatedly to persuade pay review bodies for nurses, doctors and dentists to abandon national pay bargaining. They tried to break the pay formulae for the police and the fire service. The motion is all part of the same approach.

Photo of Nigel Evans Nigel Evans , Ribble Valley

Will the hon. Lady try to persuade Labour-controlled local authorities to comply with the pay restraint, or will she encourage them to make whatever pay deals they care to arrange?

Photo of Margaret Beckett Margaret Beckett Shadow Leader of the House of Commons, Deputy Leader of the Labour Party

Either the hon. Gentleman was not listening or he did not understand the purport of what he heard. Local authorities are already underfunded for the pay settlements that have already been awarded and are now in payment. They will have a horrendously difficult job—[Interruption.]What is the hon. Gentleman's message and that of his Government? The Government are cheating local authorities on the funding that they have already given for the pay settlements to which they have agreed. Local authorities will have a horrendous job, and I do not propose to try to second-guess them in their difficulties.

The Government would love to break all pay formulae and abandon all pay review bodies. Most recently, in a move which I presume, from his remarks, the hon. Member for Ribble Valley (Mr. Evans) will not support, the Government are moving towards abolishing even the wages councils, the only protection still available to 2 million low-paid women in work.

At the outset, I reminded hon. Members that this was a matter for the House and individual Members. Each hon. Member has a duty to make up his or her mind—[Interruption.]Hon. Members have a duty to take account of the overall income and circumstances of their household.

Photo of Mrs Elaine Kellett Mrs Elaine Kellett , Lancaster

I presume that the hon. Lady is doing that for hers.

Photo of Margaret Beckett Margaret Beckett Shadow Leader of the House of Commons, Deputy Leader of the Labour Party

I most certainly am, and my husband does not earn the salaries paid in the European Parliament.

Each of us has a duty to make up his or her mind on the matter. I presume that press reports that Conservative Members are on a two-line Whip are mistaken, as this is clearly a matter for the House. As it is a matter for individuals, I hope that all hon. Members will consider their individual responsibility.

I deplore and oppose the Government's policy, so I shall not vote for their motion. But I do not seek a special privilege for hon. Members which I cannot secure for other, often low-paid, public sector workers. Consequently, I cannot and shall not vote against the Government motion that we should be treated as others will be treated, and I shall not vote on the main amendment.

However, I have observed that many Conservative Members, including the hon. Member for Ribble Valley, who I believe is a member of Lloyd's, have signed an early-day motion supporting Government policy, something which the Minister understandably applauded in his speech.

It is an unfortunate coincidence that the Government have found it necessary to stage this debate just before —I believe only days before—the setting up of a Select Committee on Members' Interests. We lack up-to-date information on the other earnings, fees or emoluments of Conservative Members. If they are new Members, like the hon. Member for Ribble Valley, we lack any information at all about their personal financial circumstances. It must therefore be a matter of personal honour. As Madam Speaker said before she left the Chair, no honourable Member should speak or vote in this debate to support a pay freeze for others—

Photo of Mr Terry Dicks Mr Terry Dicks , Hayes and Harlington

On a point of order, Madam Deputy Speaker. There is a wonderful smell of cooking coming from underneath the Benches. I do not know whether we now have to cook our own meals as well as listen to debates, but can you help by arranging for whoever is cooking to stop, because the smell of eggs, bacon and fried bread is rather appetising?

Photo of Miss Janet Fookes Miss Janet Fookes , Plymouth Drake

I am not sure that that matter falls within my competence, but I can certainly ensure that the message is relayed.

Photo of Margaret Beckett Margaret Beckett Shadow Leader of the House of Commons, Deputy Leader of the Labour Party

I hope that no hon. Member will speak or vote in this debate to support a pay freeze for others without declaring in full the extent to which they depend on the salary which they intend to freeze.

Among the Tory Back Benchers who signed the early-day motion to which the Lord President referred are more than 50 who have declared interests, but there are many new Members of whom we know nothing. Between them, the 50 share more than 120 directorships and consultancies. Some Back-Bench Conservative Members are fortunate enough to have inherited wealth and others —all credit to them—have made money. But we should be spared the lectures about our duty to set an example on such matters from those who have the means to evade the difficulties.

Photo of Mr Bryan Davies Mr Bryan Davies , Oldham Central and Royton

A reference to the Tory Whips Office might be helpful. Does my hon. Friend remember that, before the last election, the Whips were busy distributing largesse to their colleagues in the form of consultancies so that they could sustain themselves in the manner to which they appear to be accustomed?

Photo of Margaret Beckett Margaret Beckett Shadow Leader of the House of Commons, Deputy Leader of the Labour Party

I shall not be drawn further on that matter.

I do not know whether the Lord President of the Council intends to speak again, but one issue that is of concern to me and, I believe, the House became apparent when I looked into the background of today's debate. The right hon. Gentleman said that there had been a change in the arrangements of pay for the civil service grade with which Members' pay was previously linked, and that there was now a pay scale. I understand that the Treasury has refused to give the Fees Office any information about that pay scale. It has certainly refused to identify the point on the scale to which Members' pay might be linked.

Today, the Lord President did not even give us the minimum and the maximum of the pay scale to which Members' pay was previously linked; he merely said that the maximum would be far above our reach. It is important that we have any available information. The right hon. Gentleman referred to the relevant resolution, and some hon. Members may wish to look at the impact of the change on their pension contributions. It may be difficult for them to do so if they lack the basic information. The figure in the measure is based on the average of 3·9 per cent. quoted for all public sector settlements. It does not necessarily bear any relationship to the grade to which Members' pay was linked.

I should be glad if the Lord President would clarify his further comments. We are talking about the consequences of last year's pay increase, and there is concern that, if civil service pay for the relevant grade is frozen for the year ahead, Members' pay might be frozen for two years. That is a source of particular anxiety to hon. Members who are nearing retirement, because of the impact on their pensions.

We deplore the Government's policy whereby cuts and savings will fall entirely arbitrarily across the public sector, affecting low-paid people in particular. We utterly reject the notion that what is happening to Members' pay should be used as a precedent to attack and undermine the position of other workers in the public sector. Above all, we reject the notion that the Government are saving jobs.

Jobs directly related to the public sector will be lost because the Government cheat on the funding, even of today's package. More generally, their pay policy is intended to remove £1·5 billion from the economy. It has been estimated that cutting current Government expenditure by £1·5 billion will mean that almost 90,000 jobs will be lost across the public and private sectors as demand in the economy is reduced. That is not even a coherent or consistent pay policy; it is an ill-thought-out shambles—gesture politics.

The only way in which the motion relates to the wider problems of the country and the economy is that it is one small part of the process whereby the Government demonstrate their incompetence, break their promises and betray the trust that so many have placed in them.

Photo of Dr John Blackburn Dr John Blackburn , Dudley West 4:55 pm, 25th November 1992

This is essentially a domestic debate—it is our only forum in which to discuss our pay and conditions and, I note from the amendment in the name of the right hon. Member for Manchester, Wythenshawe (Mr. Morris), pensions.. Although it is largely a private debate on the dealings of the House, I am delighted that it is open to public scrutiny.

I shall speak of a subject that, during my years in the House, I have never heard voiced. If my proposition is accepted, it will mean a reduction not in hon. Members' pay but in their disposable income. Today I am compelled to outline a policy that I pray will receive the constructive support of all hon. Members. It relates to the death of a Member in the service of the House.

I remember, as will other hon. Members, Sir Anthony Berry, who was killed in the Grand hotel by an IRA bomb, and William Roberts, who all but died at the Dispatch Box as he addressed the House. Liberal Members, like everyone else, mourn the tragic Saturday morning when David Penhaligon suffered a fatal and horrific car crash. We also remember John Spence and Eric Heifer, who were loved by all hon. Members.

I see that the leader of the Ulster Unionists is present. The House mourned when Rev. Robert Bradford was shot dead in church while conducting his surgery as a Member of Parliament. We remember Donald Coleman, Spencer Le Marchant and a man whose spirit still pervades the place, Sir John Stradling Thomas, who was loved by all.

What is the response of the House towards the death of hon. Members in such circumstances? I do not think that the response is very good—and I say that as an hon. Member. Even worse, we treat the death of our colleagues in an off-hand way. We perhaps think about them for a short period, then dismiss them from our memories.

I am open to correction, and shall give my interpretation of how we treat the death of other hon. Members—I am not talking about using funds from the Chancellor's purse. We do so by perhaps writing to the family, or attending funerals and memorial services at which we pay tribute. Seldom, if ever, are we asked to exercise benevolence to the bereaved families—I have never been asked.

Every day for the past 40 years I have read a book which describes the gifts and states: the greatest of these is charity". I want the House to share and support my vision of benevolence. When a Member dies in the service of the House, we should be corporately invited to authorise the Fees Office in writing to deduct £20 at source from Members' salaries. In that way, we would exercise charity to the families of dead Members of the House, in the form of a sum of about £13,000. That is my proposition—and I believe that it could be done. It would be a practical expression of sympathy and affection for the family of a colleague who had served in the House.

I am conscious that I will not receive a positive response from Opposition Front-Bench spokesmen or from Ministers, but I am entitled to my vision. I intend to sow the seed of an idea this evening. I hope that the Leader of the House will consider it and that it will be discussed—to use the mystic expression—through the usual channels. I shall not lay down my sword on this issue. I believe that we should exercise this benevolence, within the community of the House of Commons, for the benefit of the widows and children left behind by Members who die in the service of the House.

Photo of Mr Alf Morris Mr Alf Morris , Manchester Wythenshawe 5:01 pm, 25th November 1992

I beg to move, as an amendment to the Motion, at the end to add 'and that the Leader of the House should make regulations to provide that any pension which may become payable to or in respect of any Member of this House under the Parliamentary and other Pensions Act 1987 should be calculated as if—

  1. The salary specified in paragraph (a) were £32,057; and
  2. The salary specified in paragraph (b) were £24,132;
if that Member pays supplementary voluntary contributions in 1993 of an amount which in the opinion of the Government Actuary is the average amount necessary to meet the full additional cost of the pensions so enhanced.' The amendment is tabled, as the House will have noted, in the names of all the managing trustees of the parliamentary contributory pension fund. Our purpose is to give Members the opportunity to make an extra contribution to the fund, so that any pension benefits payable either to them or to their dependants, if they leave the House during the period 1 January 1993 to 31 December 1994, will be calculated by reference to the notional salary of £32,057. The amendment will also help widows and other dependants of Members who die between those dates.

With regard to the first substantive point made by the Leader of the House—about the parliamentary scheme, being a defined benefit scheme—the amendment provides an option for Members to ensure that they or their widows and other dependants are not penalised if their service ends at any time in the period between 1 January 1993 and 31 December 1994. This is an insurance against that contingency which it will be for each Member to decide in his or her case. Our submission is that they should not be denied that choice.

As for the second point that the right hon. Gentleman put to me this afternoon, it calls, in effect, for a separate and freestanding scheme for additional voluntary contributions—AVCs. While the right hon. Gentleman may argue that this would be desirable, I believe that our existing parliamentary scheme should itself provide all reasonable facilities for the protection of its members and their dependants. That is the basic rationale of, and justification for, the amendment before the House. In my view, all benefits should be integral to the scheme itself.

Photo of Mr Peter Hordern Mr Peter Hordern , Horsham

I should just like to be certain about the right hon. Gentleman's point on additional voluntary contributions. Is he as clear as I am that it would be perfectly proper for the existing parliamentary scheme to take additional voluntary contributions, as that was the point that I think my right hon. Friend was making? If so, it is the most desirable outcome that we could hope to achieve.

Photo of Mr Alf Morris Mr Alf Morris , Manchester Wythenshawe

I am grateful to the hon. Gentleman. My advice is that we need a separate and free-standing scheme to provide AVCs—that it would not be possible to make that provision within the parliamentary scheme as it stands, and that new regulations would be required.

It might assist right hon. and hon. Members for me now to explain how the calculation of salary for pension purposes is made. Benefits are based on the amount of gross salary due to a Member during his or her last year of service. For example, if a Member left the House on 30 June 1993, his or her salary for pension purposes would be the amount of gross salary due for the period 1 July 1992 to 30 June 1993. Thus, the calculation of the pension or any other pension benefits would be based on the salary of £31,455·50, rather than the current salary of £30,854. My hon. Friend the Member for Derby, South (Mrs. Beckett) fully understood that point.

The lump sum payable in the event of the death of a current Member is twice the Member's annual salary. Members will note that this figure will be higher if the notional salary of £32,057 is used in the calculation. I must also point out that, under our nomination procedures, this payment is often made directly to the widow or widower and without the need for grant of probate. Thus, financial help can be made available fairly quickly at a most difficult time for the bereaved family. Any widow's, widower's or children's pensions calculated by reference to the notional salary of £32,057 will also be higher.

I must emphasise that the cost of this facility will not fall on the public purse, in that Members who wish to avail themselves of it will bear the full actuarially calculated cost themselves. Speaking as chairman of the managing trustees and on behalf of all my colleagues, I am sure that all Members will agree that this is a reasonable proposition for the House to consider.

The fate of the Government's proposal to the House will be decided in the Division Lobbies this evening by Members themselves; but we must recognise that the interests of widows and other dependants will also be affected by the proposals, and according to whether our amendment is accepted or rejected. Although their entitlements to benefit are clearly at stake, they cannot directly affect the outcome of the debate, and the managing trustees seek, by means of their amendment, to protect their interests.

Photo of Mr Joe Ashton Mr Joe Ashton , Bassetlaw

Can my right hon. Friend give me any quick, rule-of-thumb figures for the effect of the amendment not being carried on, say, a Member who spent 10 years in retirement drawing his pension, who was outlived by his wife by five years—women tend to marry younger and live longer—and who I believe might forfeit about £10,000 if this settlement is not agreed to?

Photo of Mr Alf Morris Mr Alf Morris , Manchester Wythenshawe

There can be no definitive answer to that; it would depend on the last year's salary of the Member who had died or had to leave the House because of ill health. Our essential point is that Members and their dependants will be at risk, as between 1 January 1993 and 31 November 1994, unless we provide the opportunity for insurance that the amendment offers.

My hon. Friend the Member for Bassetlaw (Mr. Ashton) is right to say that we should not limit our consideration of the amendment to the immediate future. The pension is based on the final year's salary of the individual Member who dies or for some other reason is no longer in the service of the House. We have heard this afternoon of Members who have died in circumstances of some hardship, and we have heard a proposal for helping them further by voluntary means. As my hon. Friend fears, the effect of not carrying the amendment could be long-term.

I hope that the House will agree that the amendment is a safeguard that we have a duty to provide. The additional cost if the option is used, will be voluntary. The amendment is aimed solely at protecting Members and their dependents who, because of ill health or death in service, end their service to the House between 1 January 1993 and 31 December 1994.

Photo of Mr James Spicer Mr James Spicer , West Dorset 5:10 pm, 25th November 1992

I shall speak in favour of the amendment. Before I do so, I welcome the assurance given by my right hon. Friend the Leader of the House that we shall reconsider linkage before the end of 1993. I am sure that no hon. Member wants to return to what I would term the obscene practice of voting on our own salary, and inevitably coming face to face with media criticism every year. That was an invidious procedure for everyone. I am delighted that my right hon. Friend clarified the matter.

I am a relatively new trustee, and I wish to pay tribute to the chairman of the managing trustees of the parliamentary contributory pension scheme, the right hon. Member for Manchester, Wythenshawe (Mr. Morris), for the way in which he conducts our affairs. I am currently on a learning curve, but I support what he has said about the situation that could apply between 1 January 1993 and the end of 1994.

Perhaps it is morbid to dwell on the subject, but I am told that, in an average year, 12 Members will leave the House in one way or another. We have now been sitting for about five or six months in this Session and we are way behind our quota for the year. It would be intolerable if, between now and the end of 1994, a Member were disadvantaged financially, as a result of death or retirement, in terms of the grant paid at the end of his or her period of service. A widow's rights for the rest of her life and the ex-Member's retirement life should come within the same category.

The amendment is well based and deserves support. My right hon. Friend the Leader of the House should consider it a bird in the hand. He said that there might be further discussions, but it seems that the amendment sets out the way forward. It is something tangible, and I urge all right hon. and hon. Members to support it.

Photo of Mr Archy Kirkwood Mr Archy Kirkwood Liberal Democrat Chief Whip 5:13 pm, 25th November 1992

Like the hon. Member for Dorset, West (Sir J. Spicer), I shall declare an interest. I too am a new pension fund trustee. Again taking up the remarks of the hon. Gentleman, I commend the chairman of the trustees, the right hon. Member for Manchester, Wythenshawe (Mr. Morris), on his work.

I hope that the House will consider the amendment with sympathy. It relates to the impact that the motion will have on the pension fund, the beneficiaries and others. It should be understood that the motion will have effect over a two-year period, all the way through to 31 December 1994, if it is accepted as it stands.

It is not impossible, for example, that there will be a general election between now and 31 December 1994. If that were to happen, the severance pay of any Member on leaving the House because of retirement or defeat at the polls would be affected. There would be some impact on the amount of money that he or she would be able to claim under the current schemes. If we make any changes, we should do so only after a great deal of careful consideration. Right hon. and hon. Members should understand the importance of—

Photo of Dr Norman Godman Dr Norman Godman , Greenock and Port Glasgow

Have the trustees received any representations from representatives of Members of the European Parliament on these matters? It seems that we have before us a curious form of the application of subsidiarity. It appears that the House is determining the pension rights of MEPs, their widows—God forgive me for saying so—and their widowers. It is a most curious form of the application of subsidiarity if MEPs have not been involved in the discussions.

Photo of Mr Archy Kirkwood Mr Archy Kirkwood Liberal Democrat Chief Whip

I am sure that those who occupy the: Government Front Bench have heard the point made so succinctly by the hon. Gentleman. I am not aware of any representations coming to the Committee that deals with the trustees of the pension fund. If any representations were made, they should have been made directly by MEPs to the Government.

Photo of Mr Terry Dicks Mr Terry Dicks , Hayes and Harlington

The hon. Gentleman said that there would be a freeze for two years. I was under the impression, wrongly, that it was for one year. Perhaps he will explain.

Photo of Mr Archy Kirkwood Mr Archy Kirkwood Liberal Democrat Chief Whip

I knew that I should not have become involved in this. I am a new trustee. Calculations for severance pay are based on the two years of previous service. Until 31 December 1994, the calculation will take into account the period of the freeze that we are discussing in the light of the motion.

I have taken some advice—I did not just make up what I said—and I believe that I am right. The effect would not be great, but there would be an impact on severance pay. It seems that the hon. Member for Hayes and Harlington (Mr. Dicks) is already contemplating defeat at the next general election, and perhaps before 31 December 1994. He should not worry too much, because, if this Parliament lasts until then, the effect will not be great.

I have one or two additional—

Photo of Mr Archy Kirkwood Mr Archy Kirkwood Liberal Democrat Chief Whip

I am not the best person to deal with these matters.

I have one or two further comments to make on the substantive motion. First, like everyone else, I am extremely nervous about breaking the link. Any breakage of the linkage that we have established would be unfortunate. I understood the Leader of the House to say that he was not really breaking the link, because he was holding fast to the principle. He said, in effect, that he was uncoupling it for 12 months.

I do not understand why the Government did not say, "We shall have a 1·5 per cent. increase just like everyone else." How did a freeze suddenly emerge? The small print in the autumn statement suggested that we were facing a 1·5 per cent. increase as a matter of pay restraint. I can understand that, but I do not understand—the Leader of the House will help me a great deal if he will explain—why we have moved from that restraint to a full-blown freeze.

When I intervened in the speech of the Leader of the House, he made it clear that not much money would be saved. That must be so. It seems that we are talking about saving £1,000 per Member under the terms of the substantive motion. That is about £700,000-worth of public expenditure. That is a flea-bite when set against public expenditure totals. The Government could look at many other areas, such as Ministers' country houses, if they want to save money on that scale.

I am a new member of the Liaison Committee which is working out how to spend £500,000 or £600,000 of taxpayers' money to inform Select Committees by sending Members abroad. I am in favour of travelling abroad, especially in relation to some of the reports about Europe. It is entirely reasonable for members of Select Committees involved in the study of detailed subjects to be able to travel when absolutely necessary. However, members of the Select Committees on Trade and Industry, on Home Affairs and on Defence travel to Washington and such places. A great deal of money could be saved there.

The hon. Member for Bassetlaw (Mr. Ashton) raised an important matter when he asked what was to happen to the money. The answer given by the Leader of the House was unconvincing—it seems that it will return to the maw of the Treasury. Some of it may find its way to the Bosnian refugees or Somalia or to the miners' benevolent fund, and perhaps some of it will be used to supply arms to Saddam Hussein. The motion is a mere gesture and it would be far more effective to earmark the money. I thought that the hon. Member for Dudley, West (Dr. Blackburn) would have suggested putting the £1,000 per head into the Members' benevolent fund. That commends itself much more to me than allowing money to flow back to the Treasury.

The hon. Member for Derby, South (Mrs. Beckett) spoke persuasively about the Government setting an example by freezing our pay. I shall listen carefully to the Leader of the House. If he is to gain my vote, he will have to guarantee that such freezing will not be used as a precedent in the formation of Government policy on public sector pay. It would be easy for the Government and the Chancellor to say that a pay freeze at Westminster is biting the bullet and that public sector employees will have to accept the same medicine. If that is in the Government's mind, it is iniquitous. If it is not their thinking, the Leader of the House should say so clearly in winding up.

Photo of Mr David Nicholson Mr David Nicholson , Taunton

Like many other hon. Members, I have not been present for most of the debate because of other commitments. The hon. Gentleman raises important matters and, in coal industry terms, he is on what would be regarded as a good seam. What precedents are being established in the debate and what will be the link with civil service pay? It would be unsatisfactory for the House to decide Members' pay every year. Members' pay should be linked to a group in the civil service, although I entirely accept that the present group may be in the process of being phased out and that we will have to look at the arrangements again. The freeze should be temporary and we should look at these matters again soon so that we can quickly establish an automatic link.

Photo of Mr Archy Kirkwood Mr Archy Kirkwood Liberal Democrat Chief Whip

I think that in future I shall adopt the hon. Gentleman's technique of arriving late and making a speech without being called. I entirely support the thrust of his comments, but he may not have had the benefit of hearing the Leader of the House at the beginning of the debate.

This is a complicated matter, and some hon. Members are uncertain about precisely what is to happen. The motion states that, from 1 January 1993, pay will be frozen. I understood the Leader of the House to say that he intended to cling to the principle of establishing a link. I am not clear about what is to happen in 1993 to produce a pay level for 1 January 1994. The right hon. Gentleman seemed to suggest that the reference group was no longer suitable for calculating pay. However, he did not outline the consequences that flow from that or how he would cope. Will he review the method of assessing Members' pay? If he does, he will he turning over ground that has already been ploughed by the Top Salaries Review Body, which studied all the comparators at great length.

The Leader of the House is aware of the pay of Senators and Congressmen in the United States of America and the pay of public representatives in France, Germany or even Italy, who all receive substantially more than we do. I hope that he will look at all these matters afresh, give them the fullest consideration and take evidence and publish reports rather than picking a figure out of the air.

The reference group that the Leader of the House mentioned may be subject to a 1·5 per cent. pay freeze, which may be increased or reduced. As Opposition Members have said, we do not even know the reference points in the civil service group. The right hon. Gentleman's only positive statement was that we would not lose twice. As far as it goes, that is reassuring; but does it mean that, if the average restraint is 1·5 per cent. in the calendar year commencing 1 January 1993, we can expect to lose the 3·9 per cent. civil service pay award that has already been made? The only way to make up that ground is by increasing our salaries by 5·4 per cent. from 1 January next year. The Leader of the House will have to answer that question in specific terms before he can be confident that people will understand the full implications of the Government motion.

I suspect that there has been some gesture politics by the Government, and that is no substitute for an effective economic policy. Since 1979, the Government have had a £100 billion windfall in oil and gas revenues and have received £60 billion from privatisation. They are in a sorry mess if their only effective action on the economy is to freeze Members' pay.

I am much less concerned about rates of pay than about House facilities to enable hon. Members to do the job for which we were elected. That has been a hobby horse of mine since I was elected in 1983. The people whom we scrutinise in the civil service and elsewhere have the benefit of access to high-tech equipment. The sooner that the Leader of the House and the House authorities start to provide such facilities for Members to do their job effectively, the better it will be for us all. I hope that the Leader of the House will try to answer some of my questions, especially the one about what is to happen after 1 January 1994.

Photo of Nigel Evans Nigel Evans , Ribble Valley 5:27 pm, 25th November 1992

Much has been said about Members' pay since it was first granted in 1911, which was a little before my time, and I am sure that much more will be said about it in future. It is an emotive subject that is often clouded by Opposition Members who are far more interested in the incomes of Conservative Members than those of hon. Members generally. That typifies socialist thinking—if that is not a contradiction in terms —and flies in the face of a common acceptance over the years, as stated in the 1983 Top Salaries Review Body report, that hon. Members should not be driven to take on additional paid employment simply because of financial pressures. For their own reasons, many hon. Members take additional paid employment. Some Opposition Members have a fixation, driven by dogma and stirred by envy, that levelling is the name of the game. As usual, the levelling is downwards.

As the Leader of the House said, there is a problem with the current pay settlement, because a productivity element is being introduced into civil service remuneration. It has been suggested that that should apply to the pay of hon. Members.

Photo of Mr Terry Dicks Mr Terry Dicks , Hayes and Harlington

I hope that my hon. Friend will point out that civil servants receive both a non-contributory pension and a lump-sum gratuity when they retire. The Government never took that into account when Members' pay was linked to that of civil servants and we received 89 per cent. of grade 6 pay.

Photo of Nigel Evans Nigel Evans , Ribble Valley

My hon. Friend has made his point admirably, but I was going to make another point, in connection with performance-related pay. Who would judge the performance of Members of Parliament? I think that the electors would be the best judges: given that they supported the Conservatives in 1979, 1983, 1987 and 1992, and will do so again at the next general election, Conservative Members should feel quite safe about being paid according to performance—although I would feel extremely concerned about the prospect were I an Opposition Member.

The debate, however, is not about the remuneration of Members of Parliament in general; it is about their remuneration during a period of pay restraint. This year, I voted—along with some Conservative Members and most Opposition Members—for an increase in office cost allowances. That was not a particularly popular move, but I felt that it had to be made. As has been said, Members of Parliament need to have the tools for the job, and those tools are very expensive—especially for new Members, who incur the start-off costs of all the new equipment that they must acquire. Pay, however, is an entirely different matter; I do not think that Members' pay should be differentiated from that of other people.

My constituency has one of the lowest unemployment rates in the country, but I cannot be complacent. This week one of our major cement companies, Castle Cement, announced 70 redundancies. Other job losses, short working, pay freezes and—in certain circumstances, in the private sector—pay reductions have been commonplace for the past two years, and have become more so as the world recession has gripped. How would it look to the country at large if we, as a group, voted ourselves a pay rise while others suffered pay cuts? We should look worse than pickpockets, taking from others and hoping that they were looking the other way. The public, however, are not looking the other way; they are looking at the House.

I believe that the autumn statement was imaginative, realistic and a boost to confidence. It sent the nation a determined message that all possible measures would be taken to speed our journey to recovery. The public sector, which has enjoyed a real improvement in living standards since 1979, has been asked to restrict wage rises to 1·5 per cent. this year. That will help to ensure that resources are available for the capital projects that we have all pressed the Government to continue; it will also allow social security uprating, which the House will applaud.

This debate is not about gesture politics; it is about sending the public a message about the need for restraint on the part of the public sector, Members of Parliament and the private sector. The private sector has taken the brunt of the knocks from the recession: frozen pay is no stranger to companies whose profits have slumped and whose markets have shrunk. In a recent speech, my right hon. Friend the Prime Minister asked for pay restraint in the boardroom as well as in the toolroom. I echo those sentiments, along with the message that has been sent to the captains of our newly privatised companies and, of course, to the rest of us: there can be no conscientious objectors in the fight against recession.

Too many bosses of late have been grabbing double-figure pay increases. Some water bosses seem oblivious to what is happening around them. While other workers are forced to forgo their jobs, let alone pay increases, water bosses have been heaping riches on themselves. They should hand those riches back.

Photo of Mr Derek Fatchett Mr Derek Fatchett , Leeds Central

The hon. Gentleman has raised an interesting point. May I draw his attention to the behaviour of the chairman of Yorkshire Water, who has just taken a substantial pay increase? I wonder what advice the hon. Gentleman would offer his hon. Friend the Member for Pudsey (Sir G. Shaw), who is a paid director of Yorkshire Water—that constitutes part of his outside earnings. Would he advise his hon. Friend to tell the Yorkshire Water chairman not to take a pay increase at all?

Photo of Nigel Evans Nigel Evans , Ribble Valley

According to figures that I have before me, the Yorkshire Water boss received a 40 per cent. pay rise this year. I shall comment on that but I shall leave it to hon. Members to decide what they ought to do with their own incomes.

As I have said, there should be no conscientious objectors in the battle against the recession, whether the battle is fought in the boardroom or in the toolroom. When the foot soldiers are in the firing line, the captains can be found in the mess swigging down the brandy and stuffing their pockets with cigars; but everyone must make a sacrifice for the country, and the sight of some top people raiding the war chest is certainly an unpalatable one. I hope that shareholders, in Yorkshire and elsewhere, will take note of that.

Photo of Mr Derek Fatchett Mr Derek Fatchett , Leeds Central

The hon. Gentleman seems to have missed the essential point. What advice will he give his hon. Friend the Member for Pudsey, who is a director of Yorkshire Water?

Photo of Nigel Evans Nigel Evans , Ribble Valley

I have already responded to that question. As I have said, such companies have shareholders, and I hope that they will note exactly what bosses and others are being paid. I repeat that there can be no conscientious objectors.

In 1983, the Top Salaries Review Body stated that it would damage the national interest if the salary of Members of Parliament was allowed to remain too far below the levels available to able men and women in other walks of life. The current national average pay for men is about £340 a week—I realise, of course, that averages take extremities into account. Clearly, Members of Parliament do worse than some people, but we do a great deal better than others. My real reward will come in heaven; but I fully understand why some Opposition Members may prefer to receive their rewards now, on earth.

It is rumoured that some hon. Members will want to show solidarity with public-sector workers by abstaining this evening, or sitting on their hands. That, however, is hardly the response for which the public sector will look. The way in which to show support for both public and private sectors—the way in which to send clear messages to boardroom bosses and industrial leaders—is to vote for a pay freeze, and to support the Government's economic recovery package.

Photo of Mr Doug Hoyle Mr Doug Hoyle , Warrington North 5:37 pm, 25th November 1992

The House will not be surprised to learn that I do not intend to follow too closely the rather naive speech of the hon. Member for Ribble Valley (Mr. Evans). Let me make one point about it, however. The hon. Gentleman described Opposition Members' criticism of moonlighters as the politics of envy; but did he not engage in the politics of envy when he—rightly, in my view—criticised company directors who had accepted huge pay increases? It does not quite add up.

Photo of Nigel Evans Nigel Evans , Ribble Valley

I was asking for pay restraint in all sectors—public and private, boardroom and toolroom—in the next pay round, irrespective of current earnings. We should note, however, that the 49 companies that have been privatised since 1979 now earn the country £2 billion in taxation, year in, year out. Before they were privatised, they cost the Exchequer £50 million a week.

Photo of Miss Janet Fookes Miss Janet Fookes , Plymouth Drake

Order. Each intervention has tended to be longer than the last. Sadly, long interventions are not the prerogative of either side of the House.

Photo of Mr Doug Hoyle Mr Doug Hoyle , Warrington North

As a matter of fact, I was finding the hon. Gentleman's reply quite interesting. I take it from what he said that he will tell his hon. Friends who hold directorships and consultancies not to accept pay increases in the coming year.

Photo of Mr Doug Hoyle Mr Doug Hoyle , Warrington North

Let me make it clear where I stand. I am totally opposed to pay freezes, so I shall vote against the Government motion. The pay freeze for the public sector will not make matters better. As my hon. Friend the Member for Derby, South (Mrs. Beckett) said, many people, because of the restrictions on local government, will lose their jobs. Far from improving things, the pay freeze will make matters worse. The restrictions on purchasing power will not lead to economic recovery. We shall be shoved deeper into recession.

We are linked to those in grade 6 who received their pay increase last August. We ought therefore, if there is any natural justice, to have got ours in August. It just so happens that our increase is due next January. We ought to be given that increase, for our pay is linked to grade 6. The Leader of the House was ambiguous. He referred to the link having been maintained. With whom is the link being maintained? It will be difficult to maintain that link, for the Leader of the House went on to say that those in grade 6 are to go on to performance-related pay. If Cabinet members were on performance-related pay, they would have to pay money to the Treasury for years to come. To whom, therefore, shall we be linked? Can the Leader of the House assure us that pay restraint will apply for only 12 months?

Photo of Andrew Robathan Andrew Robathan , Blaby

What repayments were made by the Labour Government to the Treasury for their performance between 1974 and 1979?

Photo of Mr Doug Hoyle Mr Doug Hoyle , Warrington North

That is a pathetic question. When we left office, the economy was in good shape. [Laughter.] I shall take the smile off the face of the man who hails taxis. When we left office, unemployment was very low and it was continuing to go down.

Photo of Mr Doug Hoyle Mr Doug Hoyle , Warrington North

More than 30 per cent. of manufacturing industry has been destroyed by the Government's economic policies since 1979.

Photo of Mr Doug Hoyle Mr Doug Hoyle , Warrington North

I shall not give way to any other hon. Members—

Photo of Mr Doug Hoyle Mr Doug Hoyle , Warrington North

—because it is very unfair to my hon. Friends.

Photo of Mr Doug Hoyle Mr Doug Hoyle , Warrington North

I shall give way with pleasure to one of my hon. Friends.

Photo of Dr Norman Godman Dr Norman Godman , Greenock and Port Glasgow

Can I remind my hon. Friend that, in his motion, the Leader of the House appeals to my hon. Friend and to the rest of us to behave in a decent and fair-minded way by refusing a pay increase? Does my hon. Friend agree that the Leader of the House could respond in a decent and fair-minded way by ensuring that the money saved is given to those non-governmental organisations that seek to help people in the developing world who at this moment are starving?

Photo of Mr Doug Hoyle Mr Doug Hoyle , Warrington North

My hon. Friend makes a powerful point, which I hope the Leader of the House will take on board, though I doubt whether he will. My hon. Friend the Member for Bassetlaw (Mr. Ashton) asked a similar question, but he received no reply.

Photo of Mr Doug Hoyle Mr Doug Hoyle , Warrington North

No, I am afraid that I am not going to give way to the hon. Member.

Photo of Mr Doug Hoyle Mr Doug Hoyle , Warrington North

That's a laugh, isn't it? A Whitehall farce, if ever I heard one.

We are being used as a stalking horse to justify the public sector pay freeze—people who are among the lowest paid in the country. The Government want to be able to say, "Look, now that we've frozen MPs' pay, we expect you to restrict your pay demands." The Government are playing gesture politics. That is entirely unfair and will not work.

The Leader of the House said that he would listen carefully to what my right hon. Friend the Member for Manchester, Wythenshawe (Mr. Morris) had to say when he moved his amendment. I do not understand why the Leader of the House did not accept the amendment, particularly as my right hon. Friend said that it would be up to hon. Members to make supplementary voluntary contributions. Now that the Leader of the House has listened to my right hon. Friend's speech, I hope that he will say when he replies to the debate that he accepts the amendment.

To turn to the stench that is coming from the other side of the House and to the hypocrisy of those who signed early-day motion 834, it is difficult to get at the exact truth, for the new Register of Members' Interests will not be published until next January. However, only three of those who signed the early-day motion have no outside interests in the form of consultancies or directorships. All the others have, on average, four. I have informed all these hon. Members that I might refer to them, so I have complied with the conventions of the House.

The hon. Member for Slough (Mr. Watts) signed the motion. His directorships are Kenton and Middlesex building society and Global Satellite Communications (Scotland) plc. He has an office—John Watts and Co., Chartered Accountants. He is parliamentary adviser to the Institute of Actuaries and consultant to Rank Hovis McDougall and Wisdom Securities Ltd. There is one interest for which he might not be paid quite so much—as adviser to the Working Men's Club and Institute Union. That really is going down market, but he goes up market after that. He is also parliamentary adviser to the Institute of Chartered Accountants in England and Wales. By playing at gesture politics, I do not think that the hon. Gentleman will suffer too much.

Photo of David Winnick David Winnick , Walsall North

He is too busy to be here.

Photo of Mr Doug Hoyle Mr Doug Hoyle , Warrington North

Yes.

The hon. Member for Arundel (Sir M. Marshall) has 13 outside interests. He is the managing partner in Marshall Consultants and the chairman of Direct Business Satellite Systems. He is also a non-executive director of Integrated Information Technology Ltd. He is parliamentary adviser to British Aerospace—and, by God, it needs an adviser. He is also parliamentary adviser to Cable and Wireless, Comsat, Dynamic Engineering Inc., the Society of West End Theatres and Williams Holdings. Would you believe it, the hon. Gentleman is also a member of Lloyd's.

Photo of Mr Doug Hoyle Mr Doug Hoyle , Warrington North

No. I am sorry if this is upsetting the hon. Gentleman.

The hon. Member for Surrey, North-West (Sir M. Grylls) has a few nice little earners. He is a director of Le Carbone Lorraine, Stirling Winthrop, the Small Business Bureau and Cape plc, whatever that means. It may have South African connections, but I am not sure. The hon. Gentleman is consultant to Digital Equipment Company Ltd., the Association of Authorised Public Accountants, Bywater Group Ltd., the Unitary Tax Campaign, Humphreys and Glasgow Ltd., Harlingspear Ltd., Allied Partnership Group plc and Freight Complex Development and Management Ltd. One of his clients—he lists this because of questions that were asked in the Select Committee—is Ian Greer Associates.

I do not think that the right hon. Member for Chertsey and Walton (Sir G. Pattie) will feel the pinch. He signed the early-day motion. He has directorships with Nexus Marketing, Fairey Group, Leica plc, GEC Marconi and Carroll Group. He is a partner in Terrington Management, and he lists other clients. I do not think that he will go too short in 12 months.

I now refer to the hon. Member for Wirral, South (Mr. Porter). At least he has—[Interruption.]

Photo of Miss Janet Fookes Miss Janet Fookes , Plymouth Drake

Order. There is an increasing tendency for dialogue to take place between Conservative and Opposition Members, which is not acceptable.

Photo of Mr Doug Hoyle Mr Doug Hoyle , Warrington North

I assure you, Madam Deputy Speaker, that it is not dialogue. Government Members are all directors and consultants of different companies. It is certainly not a dialogue. I am simply trying to make the point—

Photo of Miss Janet Fookes Miss Janet Fookes , Plymouth Drake

Order. I think perhaps the hon. Member misunderstood me. I was referring to sedentary comments being thrown across the Floor while the hon. Member is making his speech.

Photo of Mr Doug Hoyle Mr Doug Hoyle , Warrington North

I thank you, Madam Deputy Speaker, for that comment. I refer now to the hon. Member for Wirral, South. He has directorships of County Seeds Ltd. and Decision Makers Ltd. He is employed as parliamentary adviser to the Hearing Aid Association Wang (UK) Ltd. and Impac plc. He is a consultant to Air Boss Ltd. and Groen Ltd. He is also a solicitor with Fanshaw Porter and Hazelhurst.

Photo of Mr Barry Porter Mr Barry Porter , Wirral South

I am obliged to the hon. Gentleman for his unfailing courtesy in giving me notice that he would put the stiletto between my ribs. Perhaps he might accept that my great failing in life is that no one has asked me to be president of the Association of Scientific, Technical and Managerial Staffs. I have no doubt that the job would take a great deal of time outside the House, but I do not know whether there is much money in it.

The hon. Gentleman should note that my interests are properly declared. He should also accept that some of my interests in the manufacturing and service industries keep my feet on the ground while his head is in the clouds.

Photo of Mr Doug Hoyle Mr Doug Hoyle , Warrington North

The simple reason why the hon. Gentleman has not been asked to be the president of the ASTMS is that, as I understand it, he is not a member of a trade union. I must remind him that the ASTMS no longer exists so it is not possible for him to be the president. The ASTMS has become a new union, and is still growing, with more than 6,000 members. So he could not possibly be the president of ASTMS.

Photo of Mr Barry Porter Mr Barry Porter , Wirral South

I apologise, but I must go now, not to a board meeting but to attend a lobby of my constituents.

Photo of Mr Doug Hoyle Mr Doug Hoyle , Warrington North

I am sorry that the hon. Gentleman is going. When I gave way to him I thought that he might have told us what these nice little earners bring in for him.

I am sure that there is one thing missing from the register: it does not say what people earn from their interests. What I am saying is that it is hypocritical for those hon. Members who signed the early-day motion and whom I have mentioned—I could mention more of them —to support the Government's motion. They still have nice little earnings from moonlighting. The register does not tell us how much they earn. My point is that they certainly will not suffer by giving up the increase. The Government are asking us to give up the increase.

The hon. Member for Ribble Valley (Mr. Evans) said from a sedentary position that some Opposition Members may have outside jobs. All I am saying is that all hon. Members should declare what they earn. If the hon. Member has any interests, I hope that he will register them. Perhaps alongside those interests he should show what they bring in for him. We can only guess what Conservative Members earn from their interests. However, it is clear from the register that many hon. Members must earn more from their interests than their parliamentary salary.

Photo of Nigel Evans Nigel Evans , Ribble Valley

Will the hon. Gentleman give way?

Photo of Mr Doug Hoyle Mr Doug Hoyle , Warrington North

No, because many other hon. Members want to speak. It is a case of playing politics tonight so that the Government can impose pay restraint on many of the lowest paid in the country. I for one will have no part of it.

Photo of Mr Patrick Nicholls Mr Patrick Nicholls , Teignbridge 5:55 pm, 25th November 1992

I start by declaring my interest in the Hill and Smith Group, the Federation of Associations of Specialists and Sub Contractors, Port Enterprises Ltd, the Waterfront Partnership, Howard de Walden Estates, MinOtels and Dunn and Baker. [HON. MEMBERS: "How much do you earn?"] I earn considerably less than I deserve.

The debate has thrown up one aspect which I had not expected to examine but I think that it is useful. It is not so much the question whether the gesture should be made —I will not fight shy of that phrase—but it has thrown into debate the whole process by which hon. Members salaries are fixed.

My hon. Friend the Member for South Dorset (Mr. Bruce) and others said that there cannot be a Member in the House who wants to go through the invidious business each year of debating our pay rise. It is unpleasant, it is uncomfortable, it is demeaning, and it does not serve any purpose.

Shortly after I became a Member of the House I was pleased to see a linkage established. We could all ask whether the linkage was appropriate. It certainly made the position of senior principal in the civil service one of the most unpopular positions that any civil servant would ever want to hold. To my knowledge, many civil servants hoped that it was a grade that they might be able to overstep at some stage. It is obviously a good idea to have the automatic linkage, whatever level is chosen.

As I understood my right hon. Friend, there seems to be an element of doubt about whether the linkage can exist in the future. I certainly hope that, when the matter is examined next year, the principle of linkage will be there and that the Government will honour, as it were, the spirit of it, if not the letter. So whatever grade we are linked to, I hope that it will not simply be a lower grade with a view to making savings.

There is nothing wrong in the Government expecting Members of Parliament to make a gesture on this occasion. However, I will be slightly saddened if, in the years to come, the principle of linkage is accepted but the link is made to some other grade which is even less than 87 per cent. of, to give one example, the deputy chef in the Members' Dining Room.

It is difficult to get any fix on what the level of pay should be. It is interesting that the Library has produced a paper which I think is one of the most helpful pieces of information that I have seen on the matter. The paper sets out the level of Members' pay from 1911 to the present day, but the levels are adjusted at 1992 prices. That shows that the pay in August 1911, adjusted to today's prices, was £21,300 as against today's figure of £30,900—obviously, I am rounding out the figures. So it looks as though the level of pay in real terms for a Member of Parliament in 1911 was about two thirds of the level today. Hon. Members should bear in mind the fact that we are going back 80 years and that there has been enormous social change, both in the profile of people elected and, indeed, in those who put themselves forward for election to the House. If that sort of differential has been maintained, it shows that we have probably been getting it right. I should like to think that we will bear that in mind when the linkage is restored in some shape or form.

This is an appropriate time to mention my next point; the nexus is fairly clear. Even if I take the view that the level of Members' salaries is about right, I certainly could not say the same for ministerial pay with which it is closely connected. A few years ago, the then Solicitor-General went to the 100th anniversary of a Conservative club in the west country. In his speech, he said that his salary in the 1980s was virtually the same as that of his predecessor 100 years before when he had opened the same Conservative club.

I do not say that we should restore ministerial salaries to what the Solicitor-General was earning then, relatively speaking, but something has gone wrong with the system. It is all very well to expect people who accept ministerial office not to go into it for profit, but there comes a time when the gap between what Ministers are paid and what able people might expect to command in the outside market becomes so vast that the public interest is not served. I would say that whether the Conservative or the Labour party were in office.

There are former Labour Ministers in the House too, and they will know that a Minister receives a reduced salary in his capacity as a Member of Parliament. I do not understand how we can justify paying a Minister of the Crown less than a Member of Parliament simply because he is a Minister. There is no reason in principle for that.

There is never an ideal time to make such alterations—to restore ministerial salaries to what they should be and to stop the reduction in their salary as Members of Parliament—but it is clear that over the past 10 years, to take no longer period, there will have been opportunities for the problem to be addressed, and that those opportunities were not taken. I should like to think that at some time in the future they will be taken—although I have been in the House long enough to believe that it is highly unlikely that that disparity will ever be dealt with as it should be. To coin a recent royal euphemism, ministerial salaries are relatively insubstantial, bearing in mind the task that Ministers are expected to perform.

It is probably about right that in due course there should be a linkage for Members' pay. But what about the gesture which is being requested? There is a difference between gestures and gesture politics. It is difficult enough to say to a low-paid worker, "Here am I on £30,000 a year" —that may seem a relatively modest sum, but it is hugely more than the average constituent of the hon. Member for Derby, South (Mrs. Beckett) earns—"but I think I should have my 3–9 per cent. this year, because that is what the linkage will be." I do not think that that would go down very well, and I can understand that.

The hon. Lady might say to her constituent, "I have struck a real blow for you today. I have really done something for low-paid workers in my constituency: I am prepared to abstain." She did not say whether she would take the money if her abstention meant that the money would be paid. Probably for reasons of malice and cynicism, I should like to see the hon. Lady say to a low-paid worker in her constituency, "Vote for me; I am the one who did not take a percentage increase on £30,000 a year." For many of our constituents, that is a huge amount of money, and I think that she would find that gesture difficult to sustain.

Sometimes gestures have to be made, even if they engender cynicism. It is fair to say that there is a limit to what the country can afford. We have been told in the autumn statement that the Government believe 1·5 per cent. to be the appropriate maximum increase in the public sector. I cannot prove that the Government are right or that they are wrong. Perhaps the figure should be 1·4 per cent. or 1·8 per cent.—none of us can say—but every penny that goes into the pockets of public sector workers such as ourselves has to come out of somebody else's pay packet, either through taxation or by borrowing, which in turn has to be paid for out of taxation. The Government have to estimate what the country can afford in recession.

Some may say, "I do not agree with that; I do not agree with pay policies at all." Fine. I do not agree with rain in summer, but it happens, and one has to cope with it. Members of Parliament constantly make a whole range of demands to Ministers on behalf of their constituents and find, inevitably, that those demands cannot be satisfied. Against such a background, I do not see how the Government can do anything but set a fairly strict level, nor how Members of Parliament can expect not to make some contribution.

I accept that some Labour Members do not agree with the policy—I think they are wrong, but that is their view —but I do not understand how, even if he believes the policy to be wrong, an Opposition Member on £30,000 a year can say to a public sector worker who may earn £8,000, £9,000 or £10,000 a year that he opposed the Government because he believed the policy to be wrong. One cannot abstain on the issue. That does not work; it is an issue on which one has to make some judgment.

Debates on Members' pay tend to follow a ritual pattern, as those who have listened to them over the years know. One idea, as expressed by the hon. Member for Derby, South and the hon. Member for Warrington, North (Mr. Hoyle), is that there is something hypocritical in a Member of Parliament with outside interests taking a view on the matter, or signing an early-day motion — [Interruption.] We hear the chorus of abuse again. One would have a little more confidence in the sincerity of that chorus if the hon. Member for Warrington, North, in his rambling researches, had hit upon the relatively few Labour Members who are employable in any other context. There are many who serve in such positions with great distinction—

Photo of Mr Patrick Nicholls Mr Patrick Nicholls , Teignbridge

I shall give way to the hon. Gentleman in a moment.

I fully understand why the hon. Member for Great Grimsbly (Mr. Mitchell) might not be here today: he has other things to attend to. He is a highly effective Member of Parliament, and so long as he declares his interests in the proper way, there is no reason why he should not be entitled to earn those sums. That makes him a rarity on the Labour Benches. So many Labour Members are unemployable in any capacity but that of former members of the polytechnocracy.

When reading reports of debates such as this one, it is interesting to examine the comments of those whose reflections on the way in which Conservative Members earn money are the sternest. Let us consider the comments of the hon. Member for Bolsover (Mr. Skinner). There is a man who, now that street cleaning has been thoroughly mechanised, is totally unemployable anywhere other than in this House. As recently as 13 July the hon. Gentleman made clear his attitude to being a Member of Parliament. In fairness to the hon. Gentleman, I must tell the House that his remarks, which are recorded at column 835 of Hansard, were made on one of the relatively rare occasions when he was here after prime time television had finished at 4.30 pm. He made it clear that he saw the job of a Member of Parliament as a nine-to-five job, for which he was obviously quite content to receive £30,000 a year. If that is someone's attitude to his work, it is understandable why nobody would employ him to do anything else.

The fact is that what many Conservative Members—and all too few Opposition Members—bring to the Chamber is some knowledge of what goes on in the outside world. There is something thoroughly unsatisfactory about Members who have never gainfully earned their living in their lives, other than perhaps—

Photo of Mr Patrick Nicholls Mr Patrick Nicholls , Teignbridge

I do not want to forget the hon. Gentleman. I know that we have a lot of time, so I shall be able to give way to him in a moment.

There is something thoroughly unsatisfactory about hon. Members who bring nothing to the Chamber but bile, biliousness, class hatred and a certain distaste for those of their colleagues who are capable of earning anything other than a Member's salary. It is thoroughly distasteful that the contributions which those few—and we many—can bring to the House should not be heard.

Photo of Mr Bryan Davies Mr Bryan Davies , Oldham Central and Royton

Will the hon. Gentleman clarify two matters? First, does he include his list of consultancies and outside occupations in his election address and tell his constituents that those must be taken into account while he is fulfilling his duties as their Member of Parliament? Secondly, when he talks about the sacrifices that we should all make, is he prepared to quantify the sacrifice, in terms of his income, that he will make if the motion is passed?

Photo of Mr Patrick Nicholls Mr Patrick Nicholls , Teignbridge

I assume—although one should not always make such assumptions when dealing with interjections from Labour Members—that the hon. Gentleman is capable of working out 3·8 per cent., or 1·5 per cent., or 0 per cent., of the existing parliamentary salary. So he will be able to work out—at a stroke, given sufficient time—the amount of income which I would forgo. The hon. Gentleman may say that it does not sound very much. Frankly, on £30,000 a year, it is not very much —but every little helps.

The hon. Member for Derby, South was making the same point when she said that people had to assess the worth of the pay rise in the light of their own personal circumstances. There may be many Opposition Members who, in their personal circumstances, see no necessity to seek additional employment. I have no objection to that, but Members should be entitled to make that judgment for themselves.

The hon. Member for Oldham, Central and Royton (Mr. Davies) wanted to know what was in my election address. I am flattered about that. I certainly mentioned in my election address the fact that I was a practising solicitor and that was publicised as I went through the selection process. I made it clear that I worked for a living and that I had not come up through the more traditional avenues with which the hon. Member for Oldham, Central and Royton will be familiar. I had not come up through the unions, the polytechnocracy or the Labour party research department. I made it clear that I continued to work for a living and that I believed that I would bring to the House of Commons—and to that rarefied atmosphere in which hon. Members worked—experience of work in the outside world.

To cheer up the hon. Member for Oldham, Central and Royton, I can tell him that a local newspaper produced a detailed profile of the various parliamentary candidates and listed their outside activities and consultancies. To confirm what I hope was the hon. Gentleman's assumption, I am delighted to tell him that I had a great deal more experience of the outside world than any of my opponents. Through my connections, I was able to show that I had a far wider range of knowledge of the issues that affected my constituents than any of the other candidates. I hope that that will reassure them.

I had expected to hear more in this debate about our recent debate on the increase in hon. Members' expenses. The debate was interesting in many ways, because the Government thought that it would be helpful to give a lead about what they thought hon. Members should do. That lead was very helpful and I examined it carefully. Had I been a member of the Government, I would probably have made the recommendation to the House that the Government had made. However, I am not a member of the Government and, in the end, I had to make what I thought was the correct judgment.

While I welcome guidance from the Government in many areas, I decided that I could not welcome guidance from the Government if that guidance told me that the demands that are rightly made on me as an hon. Member were not to be satisfied as I would not have the necessary funds to satisfy them.

Therefore, I thought that the issue should not be expressed, as it was so often expressed, as simply more expenses for hon. Members, but that instead there should be an upper limit against which an hon. Member could draw as necessary. I was one of the relatively few hon. Members to vote for that idea. A great many more, who are conspicuous by their absence today as they were then, did not turn up and vote for the proposal.

There is all the difference in the world between the expenses necessary to provide the kind of services to one's constituents that they are increasingly demanding and an increase in salary. Obviously, cynics in the Press Gallery and the cynics who write to hon. Members will say, "No, it's all the same really. An increase in expenses is the same as an increase in salary." A business man put precisely that point to me. When I asked him whether he thought that every time he gave his secretary a new word processor or an upgraded typewriter that increased his standard of living, I did not receive a reply. Expenses and salaries are entirely different matters.

When we come out of this recession, public pay will be dealt with as it was before. Whatever the complexion of the Government may be, every year they will tell us that times are hard and restraint is necessary. We will always be told that. That has been part of the Treasury abacus and word processor since Adam was a lad. Some people will negotiate, some will bargain, others will have linkages and others will have formulae. That is the normal world.

However, today's world is not a normal world. It is a world of recession. Hon. Members on both sides of the House have friends or relatives who have lost their jobs during the recession. People have suffered greatly. I doubt whether there are any Conservative or Opposition Members who do not have friends or acquaintances who have lost everything in the recession. At the end of the day, with people in that position, we must make a gesture and be prepared to take the lead.

Although 3·8 per cent., or even 1·5 per cent., of £30,000 is not very much, it sets a keynote. We must be prepared to say that that is what we are recommending for the country and that is what we are prepared to take ourselves. That should be agreed on both sides of the House.

Photo of Mr Derek Fatchett Mr Derek Fatchett , Leeds Central 6:13 pm, 25th November 1992

The hon. Member for Teignbridge (Mr. Nicholls) was absolutely correct when he said that the proposal is a gesture. My hon. Friend the Member for Derby, South (Mrs. Beckett) called it a smokescreen. However, the value of the hon. Gentleman's gesture would be greater if we achieved one or two objectives set out in the amendment that I tabled but which Madam Speaker did not select.

The hon. Member for Teignbridge made two points upon which I will comment. He said that we live in a world of recession. Opposition Members remember what Conservative Members were saying only seven months ago. Not one Conservative Member said then that there would be a public sector pay freeze. Did any Conservative Member state in his or her election manifesto that they would support a public sector pay freeze? Not one of' them did. They all said that it was possible to have tax cuts and more public spending and that we were coming out of recession. The green shoots were everywhere. They were on every election address—

Photo of Mr Derek Fatchett Mr Derek Fatchett , Leeds Central

No. The hon. Gentleman spoke for a long time.

Photo of Mr Patrick Nicholls Mr Patrick Nicholls , Teignbridge

Will the hon. Gentleman give way with regard to my election address?

Photo of Mr Derek Fatchett Mr Derek Fatchett , Leeds Central

No. I am sure that that is a very important document and that it will be read by posterity.

Conservative Members made promises, but not one of them has been reproduced in reality because the recession continues. However, the Government are now implementing a public sector pay freeze which is a promise that they did not make.

Conservative Members are now starting to cry crocodile tears for the unemployed and the low-paid. Let us consider what has happened under this Conservative Government. More than 2 million more people are unemployed now than in 1979. In the face of that, Conservative Members supported the Government in the Lobby just a week ago when the Government removed wages council protection from the lowest paid. I do not want to hear arguments from Conservative Members about protecting the low-paid and the unemployed.

My hon. Friend the Member for Derby, South was right. The proposal is a smokescreen and the Government are looking for a fig leaf as they stumble from crisis to crisis and policy to policy. The Leader of the House hinted—this point was picked up by the hon. Member for Roxburgh and Berwickshire (Mr. Kirkwood)—that there will be a restoration of the amount of money that might be lost this year because of the loss of linkage on this occasion. At some time in the future, the pay of hon. Members will be restored in real terms to the value that they might have enjoyed if there had been no freeze on their pay this year.

Is that correct? If so, I point out gently to the Leader of the House that it is worth while re-reading the history of such matters. Every public sector pay freeze has created a dam that burst as the public sector caught up. If the Leader of the House is going to be consistent, can he tell us whether, if hon. Members' pay is to be allowed to catch up in real terms, the same will be true for teachers, nurses, doctors, low-paid public sector workers and school dinner ladies? Will the pay of all those people be allowed to catch up? That is an important message which should come from our debate.

There are two crucial points to be made about our annual debate on Members' pay. First, as hon. Members have said, we need an acceptable system to determine our pay. In many respects, it is not appropriate for the House to have this debate. Not many hon. Members enjoy the debate. We need a system of linkage; in that regard, I agree with the hon. Member for Teignbridge: it should be restored.

The details of that linkage may now be subject to further discussion or, to use the impolite term in this place, negotiation. Nevertheless, there must be a principle of linkage so that we do not go through this process every year. This is not gesture politics today; it is almost macho politics. We are showing whether we are prepared to make a sacrifice, and then we try to lead people into what is obviously an elephant trap in respect of our pay. That is an embarrassment, and it is foolish. If we are to have an orderly public sector pay system, I suggest to the Leader of the House that hon. Members could, as a lead, have an orderly system for their own pay.

Photo of Andrew Robathan Andrew Robathan , Blaby

I agree entirely that we should have an orderly pay system for Members of Parliament and that it should be linked. I am new to the House, so the hon. Gentleman will forgive me if I am wrong, but I understand that we are to vote on the pay increase for the current financial year. I think that I am right in saying that the pay increase for nurses, teachers and civil servants for the current financial year has already been decided and awarded. This is a back-pay increase for us which we are forgoing.

Photo of Mr Derek Fatchett Mr Derek Fatchett , Leeds Central

The hon. Gentleman is not absolutely correct. He will find that there are many public sector pay increases that have to be determined, and whether they can be fully funded by local government and national health service money is a crucial question. There is an argument about linkage. I hope that we opt for linkage, establish it, keep it, and do not repeat this debate in future.

The second crucial principle for any system of Members' pay is openness. That is why I tabled my amendment. One or two Conservative Members have started to follow my lead. My amendment is a bridge-building, consensual amendment. It would make sure that, in the Register of Members' Interests, people disclosed the finances that they obtained from the outside interests that they pursued.

I am not saying for a moment that people should stop pursuing those interests. I am not saying that they should be unelectable in any sense if they have outside interests: that decision will be taken by the electorate. If electors feel that a Member of Parliament has such tremendous ability, enthusiasm and energy that he or she can hold 12 outside directorships and six consultancies and still do the job of a Member of Parliament and they vote for that person, so be it. I certainly do not object to that, although I might question the judgment of the electorate.

Photo of Mr Derek Fatchett Mr Derek Fatchett , Leeds Central

I shall develop my point further and then give way.

I spent a little time looking at the Register of Members' Interests—relating to the previous Parliament, unfortunately—and looked up Conservative Members' interests. My principle applies to all hon. Members. Before the previous election, on the Conservative Benches there were 359 directorships and 222 consultancies. Let us say that each one attracts a fee of £2,000 a year. That might be on the low side—

Photo of Mr Derek Fatchett Mr Derek Fatchett , Leeds Central

I am a reasonable and modest man trying to build bridges across the House. Let us say that it is £2,000 a year. That amounts to £1·2 million going into Conservative Members' pockets.

An important constitutional question needs to be asked: what is that money buying? People who spend money on hon. Members want to buy something, and it is called influence over Government policy. We know that from the American system. The American system is corrupt. That is why they talk about pork barrels and the influence that corporations have on congressmen and senators. My amendment says to each and every Member of Parliament, regardless of where he or she sits in the House of Commons, "Declare all your interests in the register and say how much money is involved." That is a very simple principle.

Photo of Mr Patrick Nicholls Mr Patrick Nicholls , Teignbridge

I have considerable sympathy with the way in which the hon. Gentleman is putting his point, but it is entirely fair that constituents, if they are interested, should know what interests are declared in hon. Members' entries. The hon. Gentleman will know at once that, the moment it comes out, the register is of great interest to the local press. Our salaries as Members of Parliament should be known to the public, because they are a charge on the public Exchequer. The amount of any other income is a matter between the person concerned and the Inland Revenue.

What extra information does the hon. Gentleman think constituents would get in knowing, in a list of outside interests, how much money was being paid? Surely, according to the hon. Gentleman's logic, they should know that those interests exist. Other than public prurience, what extra will constituents have in knowing what sums, if any—that is important—are paid?

Photo of Mr Derek Fatchett Mr Derek Fatchett , Leeds Central

Electors would know a great deal about our political system. They would know about its openness and genuineness. They would also know—I put it no higher than this—that when people speak in the House of Commons they are either free men or less free men. They would also know—it is the nature of life, and let us accept it as such—that, if people are receiving £100,000-a-year directorships, they might try to act in the interests of those directorships. If that is the case, the public have a right to know. [Interruption.] If Conservative Members say, "No, it doesn't happen," let us open the system and see what does happen.

The key to my proposal, which is obviously beginning to attract support among Conservative Members, has the support of the Prime Minister himself. I have not discussed the detailed amendment with the Prime Minister, but I know that he is in favour—[Laughter.] I would not discuss it with him because he might not remember it, so there is no point in my discussing it with him. The Prime Minister is in favour because he believes in open government, and this matter is part of an open democracy. We need to ensure that the public know what goes on in this place. That is the purpose of my amendment.

We have heard many arguments about making a sacrifice—a sacrifice that is equal to that of others outside. There are grades of sacrifice. If one is a £5,000-a-year school dinner assistant, there is one level of sacrifice. If one is a £30,000-a-year Member of Parliament with no other income, there is another level of sacrifice. But if one is a £30,000-a-year Member of Parliament with 11 directorships and eight consultancies, there is yet another level of sacrifice. The hon. Member for Teignbridge lectured us about sacrifice. What amount of money is he earning from outside? Will he give a commitment today that he will take no further increase in those interests next year?

Photo of Jonathan Evans Jonathan Evans , Brecon and Radnor

Has the hon. Gentleman read today's issue of the Western Mail, the well-known national newspaper of Wales? It contains an interview with his former colleague, Mr. Leo Abse, who was a Member of Parliament for Torfaen. He expresses the view that the House is devalued by having so few Members of Parliament nowadays with outside interests. Is the hon. Gentleman aware that, in a book that was published some years ago, Mr. Abse offered the observation that, throughout the time that he sat on the Labour Benches, he earned more money than the Prime Minister of the day earned and felt that that freed him from the influence of his own Whips?

Photo of Mr Derek Fatchett Mr Derek Fatchett , Leeds Central

The hon. Gentleman strongly makes my case for my amendment, if it had been selected. My amendment does not relate only to Conservative Members—

Photo of Mr Derek Fatchett Mr Derek Fatchett , Leeds Central

I shall give way to the hon. Lady in a moment, as her interventions are always a treat for the House.

My amendment relates to all hon. Members, regardless of political colour. We need to know whether outside experience has an important bearing on people's judgments of legislation. Let us look at the extent of that and the amount of money involved so that there is no corruption. That is why we need openness—so that we know that there is no corruption and that people are representing the interests of their constituents. That is what my amendment is intended to do.

Photo of Mr Geoffrey Lofthouse Mr Geoffrey Lofthouse , Pontefract and Castleford

Order. I must remind the hon. Gentleman that, although that subject is relevant to the debate, his amendment was not selected.

Photo of Mr Derek Fatchett Mr Derek Fatchett , Leeds Central

I understand what you are saying, Mr. Deputy Speaker. I always defer to your judgment, and quite rightly. I was putting forward a principle for a general pay system for Members of Parliament. I hope that what I have offered so far will win widespread acceptance.

Photo of Mrs Elaine Kellett Mrs Elaine Kellett , Lancaster

The hon. Member for Derby, South (Mrs. Beckett) made some scathing references to family income. The hon. Member for Cunninghame, North (Mr. Wilson) omitted to mention that he has a number of directorships—for example, in West Highland Publishing Co. Ltd.—and very substantial declarable shareholdings. Many Opposition Members have husbands or wives who are highly paid trade union officials. Should such facts be declared as well?

Photo of Mr Derek Fatchett Mr Derek Fatchett , Leeds Central

I have two comments in response. All directorships and consultancies, regardless of political party, would be declared under the system that I think is fair. Spouses and partners are irrelevant to what goes on.

Photo of Mr Patrick Nicholls Mr Patrick Nicholls , Teignbridge

So the hon. Gentleman's wife is a wealthy girl.

Photo of Mr Derek Fatchett Mr Derek Fatchett , Leeds Central

The answer to that is no. The issue is for the House to decide, but I think that that is an irrelevance.

I have some ideas on how we can achieve a better system for Members' pay. We need to discuss our democracy, openness, the information made available and ways to reduce corruption so that the public can have confidence in the system.

The Government have degraded our constitution and our democracy. Too often, the only characteristic taken into account when someone is appointed to public office, either in the national health service or in other places, is that he or she should be "one of us"—a card-carrying member of the Conservative party.

I believe in openness and democracy. We must end corruption, and that is why we need an open system in the House so that we know what people are paid, where it comes from, and what interests they represent.

Photo of Andrew Robathan Andrew Robathan , Blaby 6:30 pm, 25th November 1992

I found the speech of the hon. Member for Leeds, Central (Mr. Fatchett) interesting. I agree that Members' pay should be linked to some grade. I am not sure that I agree with much more, and I do not agree that Members can be bought. Should I ever have a directorship, I assure the hon. Gentleman and other hon. Members that I shall not be bought.

This is a good time to declare that I have no pecuniary interests. I have a small military pension, which I hope Opposition Members will not deny me. It will not buy me much, although I worked for it for 15 years, and I shall get it every day for the rest of my life, whether I am underneath the arches at Charing Cross station or here.

I find it distressing and disappointing that any hon. Member would vote against the motion. Opposition Members should consider their consciences. We all know that Members of Parliament are not overpaid. I have only been a Member for about seven months, and I am astonished at how hard I have worked. I never thought that it would be like this—I find it extraordinarily hard —[Laughter.] Hon. Members may laugh, but by God it is hard. We are not overpaid—I know that and Opposition Members know it. My contemporaries from university are generally earning a great deal more than I am, but I do not mind; I chose to come to this place, as did Opposition Members.

The job should be rewarding, and it is. Our salaries should be similarly rewarding and fixed to some other pay scheme and we should not have to face the unedifying spectacle of hon. Members voting on their pay.

The hon. Member for Leeds, Central mentioned outside interests, but I do not know how hon. Members find time to do other things. Opposition Members are pointing at the Conservative Benches, but when the hon. Member for Warrington, North (Mr. Hoyle) talked about the "stench" from our Benches, I thought that that showed some hypocrisy on the part of Opposition Members. I have the Register of Members' Interests here and I have made one or two notes. I shall not mention names, as that would be invidious—[HON. MEMBERS: "Go on."] No, I shall not.

The director of West Highland Publications Co. Ltd. is not sitting on the Government Benches, nor is the parliamentary adviser to the National Market Traders Federation, the director of Ladbroke plc or the person who gets the £2,000 consultancy from the National Union of Teachers.

Photo of Paul Flynn Paul Flynn , Newport West

I am well aware that Members in every corner of the House have outside interests. During the last Parliament, 14 per cent. of Opposition Members had outside interests, but 85 per cent. of eligible Conservative Members had paid outside interests.

Photo of Andrew Robathan Andrew Robathan , Blaby

I am grateful to the hon. Gentleman, but the question is: who would employ Opposition Members? I do not want to be uncomplimentary about the Opposition Member who is the parliamentary adviser to Merck, Sharp and Dohme, and also a member of the conciliation board of the European Space Agency. As Opposition Members know, there are lawyers and Queen's counsel on both sides of the House.

I believe that the right hon. and learned Member for Monklands, East (Mr. Smith) is a Queen's counsel, which I find interesting. I am sure that he gains enormously from the experience of being a good lawyer—or not, as the case may be.

Many hon. Members have union sponsorship and its meaning is indistinct; often, the register states "no pecuniary interest", but I understand that the unions assist greatly in the constituency, by running the office and the political side of things.

Photo of Nigel Evans Nigel Evans , Ribble Valley

Does my hon. Friend not find it interesting that, the hon. Member for Leeds, Central (Mr. Fatchett) said that, because Conservative Members were in receipt of funds from companies, they were somewhat tainted and could not be independent? As my hon. Friend has just intimated, some Opposition Members are sponsored by trade unions. Does that mean that they are tainted, that they are not independent and that they put their unions before their constituents? I have here a list of all Labour Members who are sponsored by trade unions. Is the hon. Gentleman saying that all those Members are tainted?

Photo of Andrew Robathan Andrew Robathan , Blaby

As I said, should I ever be a director I would be independent, and I hope that Opposition Members who are sponsored by trade unions take the same line.

The work done by Conservative Members is often related to work that they have done in the business world. It is important for us to understand that world, especially at this time of recession. It is no good sitting back with no experience and saying how much hon. Members know about business, when they know nothing. It is important for Members to have up-to-date knowledge of the business world. My up-to-date knowledge of it is not immense, but I try to get out and to learn a little.

Photo of David Hanson David Hanson , Delyn

The hon. Gentleman said that it is important to have outside interests and to be aware of the business world. I can fully accept that, but why do not he and his hon. Friends do it for free?

Photo of Andrew Robathan Andrew Robathan , Blaby

I had better answer that—it is an interesting argument. I do it for free when I am trying to find out what is going on, but hon. Members have a busy life and perhaps they feel that such work should be rewarded.

Photo of Mr Bill Walker Mr Bill Walker , North Tayside

With my accent, I do as little as I possibly can for free. Throughout my life I have taken the view that something that is worth nothing, is worth nothing. The worth of an individual—a Member of Parliament or whoever—is the worth that he can earn in the marketplace, and we ought not to be ashamed of that, whatever Opposition Members say.

Photo of Andrew Robathan Andrew Robathan , Blaby

I am grateful to my hon. Friend for that interjection and assistance.

Members' interests are not the subject at issue. The motion is important, and Opposition Members degrade it by talking about who is earning threepence for doing what, and who is sponsored by which union or is a director of what company. It is Opposition Members who tell us what terrible trouble the country is in and it is no secret that we are in a severe recession. All of us discover how severe it is when we go around our constituencies.

I have just been sitting on the Employment Select Committee and I apologise for not being here at the beginning of the debate. We were listening to evidence on the problems facing the horse racing and the coal industries, which are costing this country jobs.

I know—as do Opposition Members—what a catastrophe it is to lose one's job. The recession is a catastrophe to people who have lost their jobs and, yes, the motion is a gesture. It is about leadership.

Photo of Andrew Robathan Andrew Robathan , Blaby

The hon. Gentleman may scoff, but perhaps that is because the Liberals know nothing about leadership.

The country is looking to us for leadership. [Laughter.] The Opposition may laugh, but that is because they never get the opportunity to lead, and I am not surprised. The people look to us for leadership, and it is obvious that they would get the leadership that they deserved if they voted for the Labour party.

The motion is a gesture, but leadership is about the perceptions of being led. We must be seen to lead by forgoing the pay rise that was awarded before I entered the House.

The private sector, of which the Opposition appear to know very little, has made pay cuts—de facto pay cuts through short-term working and a shortage of overtime.

Photo of Andrew Robathan Andrew Robathan , Blaby

It is not rubbish. You should go and talk to your constituents, but perhaps you never do.

Those people who have no pay except for unemployment benefit are facing a real disaster, and they are looking to hon. Members to see how we will behave. Those in the private sector are suffering real pain, and it is worth hon. Members sharing that pain, if only a tiny part, by forgoing this pay rise.

In these times, public sector wage restraint is necessary. The Opposition may expose their bleeding hearts to public view when they say how they would deal with nurses and teachers, but tonight we are dealing with our pay, not that of teachers or nurses. We must set an example—that is not a dirty word—and show leadership, for that is what we are paid to do. I am absolutely astonished that the Opposition have never heard about leadership or example. [Laughter.] They may laugh, but tomorrow they should go to their constituents, look them in the eye and tell them how they voted tonight.

Public sector pay restraint is linked to the private sector because, surprising as it may be to the Opposition, the private sector provides the money to pay the public sector. Public sector money does not grow on trees—it comes from the toil of those in the private sector. I note that the hon. Member for Roxburgh and Berwickshire (Mr. Kirkwood) appears to be convulsed with laughter once more; he obviously understands little at all. I also note that he is sitting on his own, as usual.

The Opposition do not understand about the link between the public and private sectors because they have no experience of real work. Public sector pay restraint is necessary because the money for that pay comes from the private sector. If the Opposition speak to those of their constituents who work in the private sector, they may come to understand that.

Photo of Nick Ainger Nick Ainger , Pembroke

Before I became a Member, I spent all my working life in the private sector. I should be interested to know how many years the hon. Gentleman spent working in that sector.

Photo of Andrew Robathan Andrew Robathan , Blaby

I have already said that I have no experience of working in the private sector, which is why I receive a military pension. That is why I do not presume, unlike the Opposition, to lecture the private sector on how to run its businesses. I suggest that British industry has been too much influenced by people who have no experience of working in it, let alone any idea of how to run it.

Photo of Edward Garnier Edward Garnier , Harborough

My hon. Friend and I represent Leicestershire. Has he taken the opportunity to read the Leicester Mercury in the past month, which has singled him out for leading the campaign in the county in favour of the motion? Does my hon. Friend accept from me that the readers of that newspaper, who number several thousand—[Interruption.]—support the campaign that has been conducted for pay restraint, led from the front by Members of this House, such as my hon. Friend and myself?

Photo of Andrew Robathan Andrew Robathan , Blaby

I am grateful to my hon. Friend and next-door neighbour. The Opposition may scoff, but each evening about 130,000 people read the Leicester Mercury.Many of its readers vote Labour but all of them believe that we should vote in favour of the motion.

I want to be able to go to my constituents and look them in the eye. I hope that Opposition Members will be able to do the same with their constituents. I want to be able to say, "I may still be employed and I may be earning nearly £31,000, but I understand your problems and I shall try my best to make those problems a little better." At least that will show that I understand that my constituents look to the House of Commons for leadership and for example. That is what is sought tonight, and I commend the motion to the House.

Photo of Bill Etherington Bill Etherington , Sunderland North 6:46 pm, 25th November 1992

I have found tonight's debate interesting, if very confusing.

I apologise to the Leader of the House for not being present when he moved the motion, but, because of Government policies, I seem to spend a lot of time meeting people who come here to lobby hon. Members to let us know how bad things are for them.

It was interesting to listen to Conservative Members telling us about free enterprise. They have sought to explain that it is satisfactory for them to have four or five jobs, but I do not accept that when nearly 3 million people are unemployed. That explanation might be satisfactory legally, but it is not satisfactory morally. Conservative Members should remember that when they cast their vote tonight.

Photo of Bill Etherington Bill Etherington , Sunderland North

No; I shall not give way because I have been listening to you for long enough and I have just 10 minutes for my speech.

Photo of Mr Geoffrey Lofthouse Mr Geoffrey Lofthouse , Pontefract and Castleford

Order. While I have been in the Chair, the debate has been good-humoured. I appeal to the House to allow the hon. Member for Sunderland, North (Mr. Etherington) a chance to express his views without interruption.

Photo of Bill Etherington Bill Etherington , Sunderland North

Thank you, Mr. Deputy Speaker. The attempts by the hon. Member for Teignbridge (Mr. Nicholls) to intervene prove one thing; that the old Chinese proverb He on thin ice shouts loudest is appropriate. Tonight, Conservative Members are showing the electorate exactly what they are.

It is all very well to talk about the £31,000 that hon. Members earn. I happen to be one of those who believe that that is more than enough. Before I became a Member, I was a trade union official, and I took a reduction in salary to come here. I would willingly do so again if that would help the people who will suffer most as a result of the 1·5 per cent. pay limit that has been imposed by the Government.

Tonight's motion is about the failure of the Government's economic policies. Since 1979, they have carried on as the handmaidens of the City, the Confederation of British Industry and other similar interest groups. Their policies have been a dismal failure. Instead of asking those who have done extremely well in their 13 years of rule—the top 5 per cent. who have received almost as much in tax relief as has been earned from North sea oil revenues—to make some contribution to the state, now that the country is not doing so well, they expect the lowest-paid in society to bear that burden. That is not on.

I hope that everyone in the country realises just what you are doing and what you are about. You are about what you have been about for the past 13 years—making the wealthy, wealthier and the poor, poorer. You have robbed old age pensioners, you have reduced the standard of living of the unemployed and the disabled and you are now seeking—

Photo of Mr Patrick Nicholls Mr Patrick Nicholls , Teignbridge

On a point of order, Mr. Deputy Speaker. The hon. Gentleman is launching a grossly unfair attack on you, and I do not believe for one moment that you have done any of those things. If you have, you may feel that you want to clear the air now.

Photo of Mr Geoffrey Lofthouse Mr Geoffrey Lofthouse , Pontefract and Castleford

I am grateful to the hon. Gentleman, hut I note that he did not give that advice when his hon. Friend the Member for Blaby (Mr. Robathan) was making the same mistake. I always hesitate to intervene when new Members are speaking, but. I remind all hon. Members that it is not the practice in the House to use the word "you" when hon. Members are not addressing the Chair. That applies to hon. Members on both sides of the House.

Photo of Bill Etherington Bill Etherington , Sunderland North

Thank you, Mr. Deputy Speaker; I appreciate that advice.

I was, of course, referring to Conservative Members. I still have a little humility in my soul, unlike many of them. If they had a little humility in their souls, they might realise what was involved in the proposal in the Chancellor's autumn statement. When I heard the first part of the statement, I thought that it was good and that the analysis was excellent. I accept that there are international factors over which the Government have no control, but I also believe that the Government have been responsible for much of their own misfortune by their policies.

It is unfair for Conservative Members to expect the least able in society to bail the Government out, but in many ways that shows what they believe. Many of the people on whom the Government intend to impose a 1·5 per cent. maximum pay rise are among the lowest paid and are living below the subsistence level determined by the EC.

It would have been better if the Government had considered the introduction of progressive income tax. They do not believe in it, but the important thing about progressive income tax is that, if more money is available to the poorer people, it gets back into the economy and is not invested abroad or put into property, thus raising property prices.

The reason I shall vote against the motion is not that I am concerned about my salary. It will make very little difference to me whether I get 0 per cent., 2 per cent., 4 per cent. or 10 per cent. more. I am not concerned about a pay rise. It may concern Conservative Members because they have proved that they are concerned about trying to acquire wealth. That seems to be their main reason for existing. They do not want to distribute wealth; rather, they want to exploit those who create it.

That is what the motion is about. If I were to vote for the motion, I should be betraying the people in the public sector who are poorly paid, those who support the policies that I support, because they are the people who would suffer. [Laughter.] It is all very well for Conservative Members to snigger and grin. I do not mind that. I quite enjoy the entertainment which they give me from time to time. I do not want to be churlish about it, but it is time for Conservative Members to think about what they are doing, because the Government will never regenerate the economy as long as they keep to their present policies.

The motion is the precursor to carrying out those policies. I ask Conservative Back Benchers to consider their constituents. We have heard some mealy-mouthed references to looking our electors in the eye. I shall not have any problems in facing my constituents and explaining to them what I have done, because I work on their behalf. We do not need lectures from Conservative Members about how good they are and about how they could be employed when Opposition Members could not.

I know one thing: if I happened to end up on a desert island, I certainly would not be looking to the Government Benches to find the admirable Crichton. If some Conservative Members who are so keen to taunt us when we are genuinely trying to look after our constituents could not find a bank, an estate agent or a solicitor on the desert island, they would have to do what they have done all their lives—look around to see who they could exploit, because they are not capable of doing anything on their own.

Photo of Ms Joyce Quin Ms Joyce Quin , Gateshead East 6:54 pm, 25th November 1992

I am glad to have the opportunity to say a few words in the debate, both because I support the amendment moved by my right hon. Friend the Member for Manchester, Wythenshawe (Mr. Morris) and because I share many of the anxieties voiced by my hon. Friends and other Opposition Members about what the Government are doing via the motion.

Like my hon. Friend the Member for Leeds, Central (Mr. Fatchett), I also tabled an amendment, which unfortunately was not selected. However, I am glad that the concerns expressed in my amendment have been covered in the debate. I should like to refer to them in the next few minutes.

My main concern was that the Government, through the motion, were effectively destroying the linkage between our salaries and the salaries of the civil service grade. It is inconsistent of Conservative Members to argue on the one hand that they are in favour of linkage and on the other to support the Government's proposal effectively to break the linkage. They should think about that inconsistency and illogicality in their argument.

I listened carefully to what the Leader of the House said about securing the linkage for the future and to the assurances that he gave us. I would have felt more reassured if he had brought forward for debate an examination of the link in the light of the changes in the civil service and had not simply put the motion forward as part of the measures which the Government had previously announced in the autumn statement. That is the weakness of the Government's position.

I want to make it clear, as my hon. Friends have done, that I do not support what the Government said in the autumn statement about public sector pay. The Government are using us as a smokescreen in order to keep down the pay of the most vulnerable in society. Like many of my hon. Friends, I am not willing to take any lessons from Government Back-Bench Members about concern for low pay when the Government are abolishing wages councils, are refusing to accept Maastricht's social chapter and are presiding over a period when the gap between top earners and the lowest earners has widened so dramatically.

Ministers are out of touch with ordinary Members of Parliament on both sides of the House on the issue. They do not seem to value properly the work of a Member of Parliament who exists on a Member's pay. Recently I came across a flagrant example of that in an article written by the former Secretary of State for Trade and Industry, Lord Ridley, in the Evening Standard. In the article he described what it is like when a Minister loses his position or has to resign: Resignation from ministerial office is traumatic. Suddenly you are alone. There is no office, no private secretary, no chauffeur-driven car, no income and nothing to do. Is one's whole political career at an end in one day's fateful decision, and will one have to find a new occupation in life? I understood that when a Minister ceased to be a Minister, he or she remained a Member of the House, on the salary of a Member of Parliament and with the job of a Member of Parliament to do. I agree with the Top Salaries Review Body's analysis of an MP's work, which, found that a full-time Member was on average doing 63 to 69 hours of work a week and that the work of a Member is a full-time job. It worries me that Ministers treat a full-time Member's job in such a dismissive way.

Much of the debate has been concerned with outside interests. They are important, but I agree with the view already expressed in the debate that there is no reason for Members to be paid for outside interests. Indeed, many of us have outside interests and have our feet firmly on the ground in our constituencies. We feel very much involved in the life of the community but do not want pay for our outside interests.

I urge the Leader of the House to give us far more assurances about the linkage and timing of our pay decisions in his reply than he did in his opening speech. I hope that he will respond seriously to the concerns expressed by hon. Members on both sides of the House. It is wrong for the Government, in such a cavalier way, unilaterally to break the consensus on Members' pay, which has been built up over a long time.

Photo of Mr Tony Newton Mr Tony Newton , Braintree 6:59 pm, 25th November 1992

With the leave of the House, I shall reply to the debate.

On one or two occasions, I thought that the debate had become one on Members' interests rather than Members' pay. I shall not go into all the arguments that have been expressed, as some of them were fairly partisan. I am glad to say—I hope that the hon. Member for Derby, South (Mrs. Beckett) was aware of it—that the Select Committee on Members' Interests was reconstituted at the end of last week. I understand that it will meet next Tuesday, which should pave the way for the publication of the Register under aegis of that Committee. I hope that hon. Members on both sides of the House will welcome that.

There has been much discussion about what some Members have termed "gesture politics". That is an unreasonable description of a policy that is concerned with some £1·5 billion of public money and is directed to maintaining priority programmes and giving capital expenditure the emphasis which hon. Members on both sides of the House rightly think it should have.

I make no apology for saying plainly, as some of my hon. Friends have done during the debate, that in circumstances in which, for reasons that I have just explained, the Government think it right to ask for pay restraint in the public sector, it would be wrong if the House were to proceed as if no difference should be made in respect of its own pay. It is not reasonable to describe the Government's proposal as gesture politics.

The right hon. Member for Manchester, Wythenshawe (Mr. Morris) and others have commented on pensions. I listened carefully to what the right hon. Gentleman said, but I remain convinced, not that he is wrong to wish to deal with the problem that he identified, but that his resolution would not be an effective or justifiable way of seeking to do it. It would be much better if he were willing to accept my offer to undertake discussions about an alternative way of seeking to meet that objective through additional voluntary contributions associated with the parliamentary pension scheme.

May I repeat what I said in my speech in explaining why I doubted whether the amendment was an appropriate way to proceed. I said that, as the long-term position will not become clear until the House has debated and decided the longer-term linkage issues, Members would not find it easy to determine whether and to what extent they wished to take advantage of what is proposed in the amendment without some risk—I think that it is a substantial risk—of making payments from which they would derive no benefit.

I have suggested considering a system of additional voluntary contributions operating through the parliamentary pension scheme, which would not be free standing and separate from the scheme, as some hon. Members seem to have thought. It would have the advantage that any benefits that Members bought with those additional contributions would not be limited to the period of pay restraint but would bring a money sum not linked to such a period. They would therefore be better value for money and could be better tailored to a Member's individual circumstances.

I hope that the right hon. Member for Wythenshawe will agree to withdraw his amendment and allow us to look at what I strongly believe would be a better way to proceed. I do not dismiss the need to which he has drawn attention but suggest that we can and should seek a more satisfactory way of dealing with the need. I cannot advise the House to accept the amendment as it stands.

Photo of Mr Alf Morris Mr Alf Morris , Manchester Wythenshawe

The Leader of the House is aware that there was detailed consultation among the trustees before the amendment was drafted and tabled in my name and theirs. We seek to ensure that the parliamentary scheme itself provides all reasonable protection that Members seek for themselves and their dependants. I emphasised in reply to the right hon. Gentleman that it will be for the individual Member to decide whether he or she wants the insurance offered by the amendment.

The Government's proposal for a system of additional voluntary contributions will also require regulations. If the Leader of the House wants that provision outside the scheme, I see no reason why he could not discuss with the trustees the possibility of making AVCs an additional provision.

I do not want to let the opportunity pass for making it certain that people who may end their service to the House next year or in 1994, through death or ill health, do not leave their dependants at a disadvantage. Will the right hon. Gentleman accept that the trustees gave very careful consideration to this whole matter before submitting the amendment?

Photo of Mr Tony Newton Mr Tony Newton , Braintree

I repeat what I have said in the past few minutes. I am not suggesting that it would not be right to see whether a sensible approach to that problem can be identified. However, I do not believe that the right hon. Gentleman's resolution, as distinct from my suggestions about possible alternatives, will achieve effectively what he wants. Hon. Members will find it extremely difficult to make judgments in circumstances in which, to use the right hon. Gentleman's words, they are being offered the chance to make substantial insurance payments, which they might well get. The vast majority would get no return whatever but the money would simply disappear.

I suggest the development of additional voluntary contributions, which would both meet what the right hon. Gentleman wants and ensure that hon Members would get a return for their money. I wish to make that difference between us absolutely clear.

Photo of Mr Joe Ashton Mr Joe Ashton , Bassetlaw

Will the Leader of the House offer to bring the matter back to the House and introduce a scheme which he thinks would be better than the amendment?

Photo of Mr Tony Newton Mr Tony Newton , Braintree

It was implicit in my opening remarks, and acknowledged by my hon. Friend the Member for Horsham (Sir P. Hordern), with whom I have also spoken on the matter, that if the trustees and Members generally felt that it would be helpful to explore the possibility that I raised—the one to which I have just adverted—I should be happy to assist. I would be making that point in bad faith were I to rule out—or not rule in—doing something about it if a satisfactory arrangement could be made on the basis of those discussions.

Photo of Mr Alf Morris Mr Alf Morris , Manchester Wythenshawe

I ask the Leader of the House to accept that this is not a moment for exploring opportunities: it is an occasion when we can provide protection that may be essential to the dependants of hon. Members. If he is giving the House, as it were, a bankable assurance that there will be provision to meet the problem that I documented in my speech, we will consider the position.

Photo of Mr Tony Newton Mr Tony Newton , Braintree

I think that I made it clear to the hon. Member for Bassetlaw (Mr. Ashton) that there is a better way of achieving what the right hon. Gentleman wants. I should like the opportunity to obtain the necessary further advice, discuss the issue with the trustees and then, if we can find a solution that meets the objectives of the right hon. Member for Wythenshawe, I shall present it to the House in the appropriate form.

Photo of Margaret Beckett Margaret Beckett Shadow Leader of the House of Commons, Deputy Leader of the Labour Party

I am closely following the argument of the Leader of the House, but I have some concern. I accept his good faith in suggesting that his proposal would be better for hon. Members. However, if I understood the position correctly, when Lady Thatcher retired, having not taken her full salary, the taxpayer made up her pension. My right hon. Friend is not suggesting that; he is suggesting that each Member should have the right to choose.

I find it hard to envisage a scheme under which it would not be better to maintain the value—the full entitlement —of the underlying pension than to adopt any conceivable system of additional voluntary contributions. I should be surprised if a case could be sustained that a better return for the same money could be obtained through additional voluntary contributions than by maintaining the basic scheme.

Photo of Mr Tony Newton Mr Tony Newton , Braintree

I think that the hon. Lady and the right hon. Member for Wythenshawe may not have taken in my basic point in a difficult argument. The basis on which the resolution is tabled is that the House will need to return to the issue of long-term linkage with civil service pay at the end of next year. Until that longer term issue is resolved, hon. Members will be unable to judge what it is that they are seeking to protect themselves against.

Under the right hon. Gentleman's amendment, hon. Members will be offered an opportunity to place significant sums of money—up to £200 or £300—into a scheme from which they may ultimately receive little or no benefit. I sense that the hon. Member for Roxburgh and Berwickshire (Mr. Kirkwood) understands what I am saying. I am talking about a defined benefit and final salary scheme in which the amount that hon. Members receive is determined by their salary in the last 12 months of their term of office.

In order to deal with the problem which, I accept, could arise in the short term, and about which the right hon. Member for Wythenshawe is anxious, hon. Members will be offered the opportunity to invest significant sums of money that they may find will buy them nothing. I am arguing that a proper additional voluntary contributions system, discussed and agreed between us, would be a much better way to solve the problem and would ensure that hon. Members received a return on whatever money they invested.

Photo of Mr James Spicer Mr James Spicer , West Dorset

I do not want to prolong the debate more than a few minutes, but the trustees' anxiety is clear —that some people could fall into the trap. They may depart this life, and while discussions are taking place, their dependants will be left without additional benefit and their widows will suffer in the long term. If we can have an assurance on that key issue—the short-term period before discussions are finalised and a resolution found—I shall be happy.

Photo of Mr Tony Newton Mr Tony Newton , Braintree

In the very short term—some weeks—but not in the long term, it may be necessary to consider the role of the Members' fund in relation to certain circumstances. However, although I acknowledge the purpose of the amendment of the right hon. Member for Wythenshawe, I do not believe that it could achieve its purpose in a way that Members would find helpful. I sense that one or two other Opposition Members are now in agreement with me. I believe that we should find a more satisfactory way of seeking to achieve the right hon. Gentleman's objective. That is the offer that I am extending.

Photo of Margaret Beckett Margaret Beckett Shadow Leader of the House of Commons, Deputy Leader of the Labour Party

Now that I am able to follow more clearly the right hon. Gentleman's argument, I shall put it in words of one syllable. The impact of freezing salaries, possibly over a sustained period, will be so serious that, although in normal circumstances it is always true that it is better for someone to place a defined sum of money in a defined benefit scheme, in this case it might be better to use additional voluntary contributions. That is true in this case because the net loss suffered from freezing is greater than the net gain from additional voluntary contributions.

Photo of Mr Tony Newton Mr Tony Newton , Braintree

That is almost the exact opposite of what I am saying. The right hon. Member for Wythenshawe is offering Members a short-term insurance policy in which the overwhelming majority of hon. Members would invest money for no return. I would rather devise a scheme into which they could place money if they wished and from which they were guaranteed a return. That is a more sensible proposition, which is why I cannot accept the right hon. Gentleman's amendment.

Photo of Mr Alf Morris Mr Alf Morris , Manchester Wythenshawe

May I take it from the Leader of the House that he is prepared to meet the managing trustees at an early date to determine the timing of the regulations required by his proposals for additional voluntary contributions?

Photo of Mr Tony Newton Mr Tony Newton , Braintree

I hope that I made it clear in the very last words of my opening speech two to three hours ago that I was suggesting meeting the managing trustees to discuss the issues. Those discussions will have to take place on the basis of seeking to identify an acceptable scheme to deal with the sort of matters raised by the right hon. Gentleman. Clearly, I would take steps to enable the House to take action on any proposal resulting from the discussions. Is that a reasonable suggestion?

The issue of the right hon. Gentleman's amendment has taken much longer than I anticipated and I sense a feeling of impatience among Members. Therefore, I shall simply repeat two crucial issues for the benefit of those hon. Members who were not able to be present when I first spoke. First, the Government entirely accept the case for re-establishing a clear and automatic linkage with the civil service, comparable with what the House intended when it originally passed the resolution. We have no wish to return to the position whereby the House has to decide Members' pay each and every year.

Secondly, we do not intend that Members should forgo the pay increase that civil servants have already received —3·9 per cent. for 1992 paid in August which, in normal circumstances, we would have expected to be carried through to Members' pay in January—as well as receiving no increase for the forthcoming year. I know that many of my right hon. and hon. Friends attach importance to the issue, and we do not intend Members to be permanently disadvantaged by 3·9 per cent. in comparison with the civil service.

I hope that, with those reservations in mind, my right hon. and hon. Friends, in the context of the overall policy for which they voted after the autumn statement, will support the Government tonight

Amendment negatived.

Main Question put:

The House divided: Ayes 321, Noes 103.

Division No. 93][7.17 pm
AYES
Adley, RobertBonsor, Sir Nicholas
Ainsworth, Peter (East Surrey)Booth, Hartley
Aitken, JonathanBoswell, Tim
Alison, Rt Hon Michael (Selby)Bottomley, Peter (Eltham)
Allason, Rupert (Torbay)Bottomley, Rt Hon Virginia
Amess, DavidBowden, Andrew
Ancram, MichaelBowis, John
Arbuthnot, JamesBoyson, Rt Hon Sir Rhodes
Arnold, Sir Thomas (Hazel Grv)Brandreth, Gyles
Ashdown, Rt Hon PaddyBrazier, Julian
Aspinwall, JackBright, Graham
Atkinson, David (Bour'mouth E)Brooke, Rt Hon Peter
Atkinson, Peter (Hexham)Brown, M. (Brigg & Cl'thorpes)
Baker, Rt Hon K. (Mole Valley)Browning, Mrs. Angela
Baker, Nicholas (Dorset North)Bruce, Ian (S Dorset)
Baldry, TonyBruce, Malcolm (Gordon)
Banks, Matthew (Southport)Budgen, Nicholas
Banks, Robert (Harrogate)Burns, Simon
Bates, MichaelBurt, Alistair
Batiste, SpencerButcher, John
Beggs, RoyButler, Peter
Beith, Rt Hon A. J.Butterfill. John
Bellingham, HenryCampbell, Menzies (Fife NE)
Beresford, Sir PaulCarlile, Alexander (Montgomry)
Blackburn, Dr John G.Carlisle, John (Luton North)
Carlisle, Kenneth (Lincoln)Hanley, Jeremy
Carrington, MatthewHannam, Sir John
Carttiss, MichaelHargreaves, Andrew
Cash, WilliamHarris, David
Chaplin, Mrs JudithHaselhurst, Alan
Chapman, SydneyHawkins, Nick
Churchill, MrHawksley, Warren
Clappison, JamesHayes, Jerry
Clark, Dr Michael (Rochford)Heald, Oliver
Clarke, Rt Hon Kenneth (Ruclif)Heathcoat-Amory, David
Clifton-Brown, GeoffreyHendry, Charles
Coe, SebastianHeseltine, Rt Hon Michael
Colvin, MichaelHicks, Robert
Congdon, DavidHiggins, Rt Hon Terence L.
Connarty, MichaelHill, James (Southampton Test)
Conway, DerekHogg, Rt Hon Douglas (G'tham)
Coombs, Anthony (Wyre For'st)Horam, John
Coombs, Simon (Swindon)Hordern, Sir Peter
Cormack, PatrickHoward, Rt Hon Michael
Cran, JamesHowarth, Alan (Strat'rd-on-A)
Currie, Mrs Edwina (S D'by'ire)Howell, Rt Hon David (G'dford)
Curry, David (Skipton & Ripon)Hughes Robert G. (Harrow W)
Dafis, CynogHughes, Simon (Southwark)
Davidson, IanHunt, Rt Hon David (Wirral W)
Davies, Quentin (Stamford)Hunt, Sir John (Ravensbourne)
Davis, David (Boothferry)Hunter, Andrew
Day, StephenHurd, Rt Hon Douglas
Deva, Nirj JosephJack, Michael
Devlin, TimJackson, Robert (Wantage)
Dickens, GeoffreyJessel, Toby
Dicks, TerryJohnson Smith, Sir Geoffrey
Dorrell, StephenJones, Gwilym (Cardiff N)
Douglas-Hamilton, Lord JamesJopling, Rt Hon Michael
Dover, DenKellett-Bowman, Dame Elaine
Dowd, JimKennedy, Charles (Ross,C&S)
Duncan, AlanKilfedder, Sir James
Duncan-Smith, IainKing, Rt Hon Tom
Dunn, BobKirkhope, Timothy
Durant, Sir AnthonyKnapman, Roger
Dykes, HughKnight, Mrs Angela (Erewash)
Eggar, TimKnight, Greg (Derby N)
Elletson, HaroldKnight, Dame Jill (Bir'm E'st'n)
Emery, Sir PeterKnox, David
Evans, David (Welwyn Hatfield)Kynoch, George (Kincardine)
Evans, Jonathan (Brecon)Lait, Mrs Jacqui
Evans, Nigel (Ribble Valley)Lamont, Rt Hon Norman
Evennett, DavidLang, Rt Hon Ian
Faber, DavidLawrence, Sir Ivan
Fabricant, MichaelLegg, Barry
Fairbairn, Sir NicholasLeigh, Edward
Fenner, Dame PeggyLennox-Boyd, Mark
Field, Barry (Isle of Wight)Lidington, David
Fishburn, DudleyLightbown, David
Forman, NigelLilley, Rt Hon Peter
Forsyth, Michael (Stirling)Lloyd, Peter (Fareham)
Forth, EricLord, Michael
Fowler, Rt Hon Sir NormanLuff, Peter
Fox, Dr Liam (Woodspring)Lyell, Rt Hon Sir Nicholas
Fox, Sir Marcus (Shipley)Lynne, Ms Liz
Freeman, RogerMacGregor, Rt Hon John
French, DouglasMacKay, Andrew
Fry, PeterMcLoughlin, Patrick
Gallie, PhilMcNair-Wilson, Sir Patrick
Gardiner, Sir GeorgeMadel, David
Garel-Jones, Rt Hon TristanMaitland, Lady Olga
Garnier, EdwardMajor, Rt Hon John
Gill, ChristopherMalone, Gerald
Gillan, CherylMans, Keith
Goodlad, Rt Hon AlastairMarland, Paul
Goodson-Wickes, Dr CharlesMarlow, Tony
Gorman, Mrs TeresaMarshall, John (Hendon S)
Gorst, JohnMartin, David (Portsmouth S)
Grant, Sir Anthony (Cambs SW)Mawhinney, Dr Brian
Greenway, John (Ryedale)Mayhew, Rt Hon Sir Patrick
Griffiths, Peter (Portsmouth, N)Merchant, Piers
Grylls, Sir MichaelMilligan, Stephen
Hague, WilliamMills, Iain
Hamilton, Rt Hon Archie (Epsom)Mitchell, Andrew (Gedling)
Hamilton, Neil (Tatton)Mitchell, Sir David (Hants NW)
Hampson, Dr KeithMoate, Roger
Molyneaux, Rt Hon JamesSpicer, Sir James (W Dorset)
Monro, Sir HectorSpicer, Michael (S Worcs)
Montgomery, Sir FergusSpink, Dr Robert
Moss, MalcolmSproat, Iain
Needham, RichardSquire, Robin (Hornchurch)
Nelson, AnthonyStanley, Rt Hon Sir John
Neubert, Sir MichaelSteen, Anthony
Newton, Rt Hon TonyStern, Michael
Nicholls, PatrickStewart, Allan
Nicholson, David (Taunton)Streeter, Gary
Norris, SteveSumberg, David
Onslow, Rt Hon CranleySweeney, Walter
Oppenheim, PhillipSykes, John
Ottaway, RichardTapsell, Sir Peter
Page, RichardTaylor, Ian (Esher)
Paice, JamesTaylor, John M. (Solihull)
Patten, Rt Hon JohnTemple-Morris, Peter
Pattie, Rt Hon Sir GeoffreyThomason, Roy
Pawsey, JamesThompson, Patrick (Norwich N)
Peacock, Mrs ElizabethThornton, Sir Malcolm
Pickles, EricThurnham, Peter
Porter, Barry (Wirral S)Townend, John (Bridlington)
Porter, David (Waveney)Townsend, Cyril D. (Bexl'yh'th)
Portillo, Rt Hon MichaelTracey, Richard
Powell, William (Corby)Tredinnick, David
Purchase, KenTrend, Michael
Rathbone, TimTrotter, Neville
Redwood, JohnTwinn, Dr Ian
Renton, Rt Hon TimVaughan, Sir Gerard
Richards, RodViggers, Peter
Riddick, GrahamWaldegrave, Rt Hon William
Rifkind, Rt Hon. MalcolmWalden, George
Robathan, AndrewWalker, Bill (N Tayside)
Roberts, Rt Hon Sir WynWallace, James
Robertson, Raymond (Ab'd'n S)Waller, Gary
Robinson, Mark (Somerton)Ward, John
Roe, Mrs Marion (Broxbourne)Wardle, Charles (Bexhill)
Ross, William (E Londonderry)Waterson, Nigel
Rowe, Andrew (Mid Kent)Watts, John
Rumbold, Rt Hon Dame AngelaWells, Bowen
Ryder, Rt Hon RichardWheeler, Sir John
Sackville, TomWhitney, Ray
Sainsbury, Rt Hon TimWhittingdale, John
Scott, Rt Hon NicholasWiddecombe, Ann
Shaw, David (Dover)Wigley, Dafydd
Shaw, Sir Giles (Pudsey)Wilkinson, John
Shephard, Rt Hon GillianWilletts, David
Shepherd, Colin (Hereford)Wilshire, David
Shepherd, Richard (Aldridge)Winterton, Mrs Ann (Congleton)
Shersby, MichaelWinterton, Nicholas (Macc'f'ld)
Sims, RogerWolfson, Mark
Skeet, Sir TrevorYeo, Tim
Smith, Sir Dudley (Warwick)Young, Sir George (Acton)
Smith, Tim (Beaconsfield)
Smyth, Rev Martin (Belfast S)Tellers for the Ayes:
Soames, NicholasMr. Irvine Patnick and
Speed, Sir KeithMr. Timothy Wood.
Spencer, Sir Derek
NOES
Adams, Mrs IreneDavies, Ron (Caerphilly)
Allen, GrahamDixon, Don
Anderson, Donald (Swansea E)Donohoe, Brian H.
Anderson, Ms Janet (Ros'dale)Dunwoody, Mrs Gwyneth
Ashton, JoeEagle, Ms Angela
Barnes, HarryEastham, Ken
Barron, KevinEtherington, Bill
Bell, StuartFatchett, Derek
Bennett, Andrew F.Foster, Derek (B'p Auckland)
Betts, CliveFoster, Don (Bath)
Bradley, KeithFoulkes, George
Brown, N. (N'c'tle upon Tyne E)Galbraith, Sam
Caborn, RichardGalloway, George
Callaghan, JimGeorge, Bruce
Clarke, Eric (Midlothian)Gerrard, Neil
Clelland, DavidGodsiff, Roger
Cohen, HarryGolding, Mrs Llin
Corbyn, JeremyGordon, Mildred
Cryer, BobGraham, Thomas
Davies, Bryan (Oldham C'tral)Griffiths, Win (Bridgend)
Gunnell, JohnMurphy, Paul
Hall, MikeOakes, Rt Hon Gordon
Hanson, DavidO'Brien, Michael (N W'kshire)
Hardy, PeterO'Brien, William (Normanton)
Harvey, NickO'Hara, Edward
Hattersley, Rt Hon RoyO'Neill, Martin
Henderson, DougOrme, Rt Hon Stanley
Hill, Keith (Streatham)Pope, Greg
Hinchliffe, DavidPowell, Ray (Ogmore)
Howells, Dr. Kim (Pontypridd)Prescott, John
Hoyle, DougQuin, Ms Joyce
Hughes, Roy (Newport E)Radice, Giles
Hutton, JohnRandall, Stuart
Illsley, EricRaynsford, Nick
Johnston, Sir RussellRooney, Terry
Kaufman, Rt Hon GeraldRoss, Ernie (Dundee W)
Kilfoyle, PeterSheerman, Barry
Kirkwood, ArchyShort, Clare
Leighton, RonSpellar, John
Livingstone, KenSteel, Rt Hon Sir David
McAllion, JohnSteinberg, Gerry
McKelvey, WilliamStott, Roger
Maclennan, RobertWardell, Gareth (Gower)
McMaster, GordonWareing, Robert N
McNamara, KevinWilliams, Rt Hon Alan (Sw'n W)
Madden, MaxWilliams, Alan W (Carmarthen)
Marshall, Jim (Leicester, S)Wilson, Brian
Maxton, JohnWise, Audrey
Meacher, MichaelWray, Jimmy
Meale, Alan
Moonie, Dr LewisTellers for the Noes:
Morgan, RhodriMr. Terry Lewis and
Morris, Rt Hon A. (Wy'nshawe)Mr. Jimmy Hood.
Mudie, George

Resolved,That the following provision should be made with respect to the salaries of Members of this House—

  1. (a) the salaries of Members not falling within paragraph (b) shall, in respect of service in 1993, be £30,854; and
  2. (b) the salaries of Officers of this House and Members receiving a salary under the Ministerial and other Salaries Act 1975 or a pension under section 26 of the Parliamentary and other Pensions Act 1972 shall, in respect of service in 1993, be £23,227.