That the following provision shall be made with respect to the salaries of Members of this House—
(1) In respect of service in the period starting with 20th June 2001 and ending with 31st March 2002 the salary of a Member shall be increased by £2,000 per annum.
(2) That salary shall be increased by a further £2,000 per annum from 1st April 2002.
(3) The increases referred to above shall be additional to any increase resulting from the operation of paragraph (2) of the Resolution of this House of 10th July 1996.
The motions are to give effect to the recommendations of the Senior Salaries Review Body on Members' pay, pensions and office costs allowance. They neither add to nor subtract in any substantial way from the totality of the SSRB recommendations. I have followed the principle that the Government should put before the House all the recommendations as proposed by the SSRB in order that the House itself can make a judgment on them. The large number of amendments tabled clearly demonstrates that the House is keenly interested in the matter and wants to come to a judgment on the recommendations.
It is right that our salaries should be assessed independently. It must also be right that the independent assessment should generally be accepted by the House. The proposed increase is necessary to restore parity with the other posts in the public sector adopted in 1996 as the comparators to ours: a director of a district general hospital, a head teacher of a secondary school or a chief superintendent of police.
The proposed increase is wholly in line with the general principle set out by the previous Government, and entirely shared by this Government, that the pay of Members of Parliament should not be so high as to become the primary attraction of the job, nor so low as to deter suitable candidates from standing for election. I do not think that we impress the public if we set too low a value on our own worth. I would not go quite so far as Mr. Clarke's famous observation that the
"post of MP attracts the average pay of a saxophonist with the job security of a football manager", but I do believe that we should not sell ourselves too short. If we believe that our work here is important, we should not shrink from putting a proper value on it.
My hon. Friend Mr. Mullin has tabled an amendment proposing that our annual uprating be tied to the increases recommended for nurses, teachers and doctors. Since 1996, our salaries have been uprated in parallel with pay in the senior civil service. Had his formula applied since 1996, our current pay would be almost £2,000 a year higher. I am not sure whether it was his intention to secure an even higher rate of pay for Members of Parliament, and if it was not, he may wish to reconsider the terms of his amendment.
The 1996 increase was the result of an independent assessment and reflected the fact that there had been no annual uprating by formula in the years preceding it. If my hon. Friend's intention is that we should be paid at the same rate as those in professions with which the public can identify, I am pleased to assure him that the logical step is to support the motion, which will give us precisely the 19 per cent. increase that nurses, teachers and doctors have enjoyed since 1996.
I turn now to parliamentary pensions, on which the SSRB made eight recommendations. The motion before the House would implement all the recommendations on which a decision of the House is now possible, and it invites the trustees of the pension fund to consider the remaining matters on which further work is required. That further work will include consideration of recommendation 8, which covers the question of pensions for unmarried partners surviving Members of Parliament and to which Dr. Harris has tabled an amendment.
I should say a word about the second recommendation of the SSRB, which proposed that we drop the provision in the pension scheme that the pension of widows or widowers is withdrawn in the event of their remarriage. The House will be aware that the Government announced in March that they could not accept that recommendation. In the light of representations that I have received, we have looked at the matter again.
Personally, I find the provision to withdraw pension from widows and widowers who remarry old fashioned, to put it mildly. The motion before the House therefore invites the trustees to consider making changes in line with the recommendation, but at no cost to the Treasury.
As I am about to turn to one of the more controversial issues, may I, lest I lose my audience, first invite consensus from across the House in paying tribute to the trustees of our pension fund? All hon. Members owe a debt of gratitude to those of our number who are willing to serve as trustees. Under the leadership of John MacGregor, they have taken major steps to modernise the scheme in line with good practice, and have put it under proper professional management. I am pleased to report that the fund has been managed with a satisfactory surplus.
In their submission to the SSRB, the trustees proposed that the accrual rate should be cut from one fiftieth to one fortieth of the annual salary. I understand the reasoning that led them to propose a faster rate of accrual in the light of the unpredictability of a parliamentary career. At the present rate of accrual, fewer than 10 per cent. of hon. Members make it to the maximum pension before they retire from the House.
Nevertheless, having considered the proposal, the SSRB explicitly rejected the submission by the trustees. In its report, it submits that the current accrual rate of one fiftieth of annual salary is already better than comparable private sector schemes, and significantly better than the overwhelming majority of public sector schemes, in which an accrual rate of better than one sixtieth is an exception.
I understand my hon. Friend's point, which is very close to the one that I made earlier to the House. At this point, I should declare an interest as, in the course of this Parliament, I will achieve qualification for the maximum pension.
Indeed I will, and the fact unfortunately confirms the suggestion that I am nearing my obituary. However, I shall be one of only 8 per cent. of hon. Members who make it to that qualification. I have achieved it only because I have been blessed with constituents of judicious judgment. That is not the experience of every Member of the House.
The SSRB points out, however, that other profession also suffer from unpredictability and uncertainty. In the modern age, it felt unable to take that fact into account.
I take note of what my hon. Friend has said, but I am not sure that I necessarily wish to accept the principle that we should read across to our own package any particular element of the package in other Parliaments. If we did, we might well find ourselves to be disadvantaged in other respects.
This is a matter for the House to decide, and the House's decision will be one that I personally would take as binding on me as Leader of the House. I would not argue with that judgment. [Hon. Members: "Hear, hear."] But—[Laughter]—since I have been generous in giving that assurance to the House as Leader, I would ask the House to consider the advice that I am about to offer it.
We would ask hon. Members, before taking their decision, to reflect on whether Members of Parliament can accept an even wider gap than already exists in the rate of accrual between our pension scheme and the schemes of those who work in our hospitals, schools and local authorities. My colleagues at the Treasury attach particular weight to the public spending consequences if the accrual rate in the amendment were to become general across the public sector.
Could I say first that although the amendment stands in my name, it does so on behalf of all the trustees? Our soon to be ennobled Friend, Mr. MacGregor, is not able to attach his name, although he remains chairman of the trustees. All the other trustees of the fund support the amendment. As I wish to show later in the debate, ours is actually the meanest accrual rate of any assembly anywhere in the western world.
I have noted that the trustees have all signed the amendment and that they made a submission to the SSRB precisely in the terms of the amendment. I spoke yesterday with John MacGregor and it is only fair to report to the House that he fully shares the views expressed in the amendment.
Nevertheless, the fact remains that when that submission was put to the SSRB, it was not persuaded by the proposal and did not accept the basis of the argument put forward. The SSRB drew particular attention, as my right hon. Friends at the Treasury have done vigorously, to the fact that that would create a quite remarkable difference between our pension scheme and others in the public sector. Hon. Members have to reflect on whether they are willing to contemplate the public spending consequences of making a comparable change in those schemes.
There is no report before the House on the additional costs allowance. However, I recognise the widespread feeling among Members that the present allowance does not reflect the current realities of the London housing market. This is a particular problem for new Members seeking accommodation for the first time at current rates.
An amendment has been tabled by my hon. Friend Mr. Betts, and many, many other Members. If I understood the point of order earlier, many other Members who have not yet got their name on to the Order Paper also support it. This, again, is a House of Commons matter on which the House must make its own decision. However, the terms of the amendment would result in a very large increase indeed and would produce a new ceiling of £19,300, an increase of 42 per cent.
I fully understand why some Members demand parity with the new overnight allowance recommended for the House of Lords and define parity as 144 nights at £120. However, under the amendment as drafted, we would end up with £2,000 more a year than such parity with the House of Lords allowance would afford. This, I suspect, would be challenging to explain to Members of the House of Lords, let alone to justify to members of the public. But as I said, I recognise that there is a problem with the additional costs allowance. For some years, it has been uprated only in line with the retail prices index, while the London housing market has tended to uprate itself faster than RPI.
I do not know whether my right hon. Friend is aware of the calculations for the last financial year, which show, essentially, that the House of Lords overnight allowance was £84. If one divided the additional costs allowance by the number of days Parliament sat, it came to about £83. Proposing the same proportionate increase would mean that when the total additional costs allowance is divided by the number of days Parliament sits, it comes out at the same figure.
Page 44 of the second volume of the SSRB report states that three-star hotel accommodation has been the traditional way of judging both the overnight allowance for the Lords and the ACA for the Commons. There is the same basis for both schemes, but one is to get an increase this time while the other does not.
The issue of principle does not turn the calculation, but the figure I have just mentioned would be the consequence of my hon. Friend's amendment. We would end up with an additional costs allowance of £19,300, which is well above what would be required to meet 144 nights at the overnight allowance of £120 for Members of the House of Lords.
I understand the concern that lies behind my hon. Friend's amendment. I personally would regard it as unfortunate if the House were to depart from the principle that, before increasing our pay or personal allowances, we should first invite assessment by the independent review body. I give an undertaking to the House that, in the event of Members rejecting this amendment, the Government will refer the issue of the additional costs allowance to the SSRB and will invite it to report on an appropriate revised ceiling, as a matter of urgency. That will give us a revised ceiling that will reflect reality and—as a result of independent assessment—will also be one that we can defend.
I turn now to the resolution on Members' allowances and insurance. Let me dispose first of the provision for appropriate insurance. It is a matter of regret that we live in an age which is increasingly litigious, and I have to report that Members of Parliament also are victims of the increasing tendency to sue. Last year, the issue came before the House as the result of an action for defamation brought against an Opposition Member. The House then resolved to make general provision for insurance against action for defamation and to cover the Member for his costs.
This year, the matter comes before the House again because of a legal action claiming negligence against my right hon. Friend Mr. Straw. I have set out some of the facts of that case in a written answer, and as a legal settlement of the action has yet to be reached, the House will understand if I cannot enlarge on that.
In any case, the particular facts of the case are not the key issue. The central point is that what has happened to my right hon. Friend could have happened to many Members of the House. We all prize the hard work of our constituency staff, but with the best will in the world they can make mistakes under pressure. In today's litigious world we all face the risk of being sued for their mistakes. In most other professions, insurance cover against such a legal risk is routine and Members of Parliament should have the same protection.
The resolution before the House will ensure that all Members are provided with insurance cover against claims for negligence, as well as claims for defamation. That will provide future cover for any Members who find themselves in the same position as my right hon. Friend. It would be unfair to leave my right hon. Friend with any liability that arose from the conduct of his constituency duties, and the separate resolution compensates him for any reasonable costs of the present action. I hope that this resolution will receive all-party support in the same spirit as the resolution compensating Mr. Luff last year.
I turn now to the office costs allowance, on which the SSRB proposed sweeping changes. At the outset, I would ask the House to recognise that those changes are so sweeping that—unavoidably—issues will arise in the light of experience that will require adjustment. Indeed, some of the amendments on the Order Paper already highlight problems on which the SSRB report does not offer specific guidance. A good case in point is the amendment from Mrs. Lait on the use of the staff element to pay for research on a consultancy basis.
We therefore believe that it will be essential to provide more flexibility in the system in order that modest adjustments can be made without the cumbersome procedure of a further review by the SSRB. The resolution therefore proposes that there should be a Speaker's advisory panel to supervise the transition and to advise on the implementation of the new system. The panel will combine cross-party membership with senior officials who can advise on the practical implications of our conclusions.
The resolution also gives authority to the Speaker to make directions as necessary, and those will, of course, be published for Members of the House. That will assist the authorities in responding to the detailed problems that will inevitably occur in phasing in such a radically different system, and in resolving individual cases of difficulty.
The new system represents a radical overhaul of the way in which we fund support for Members in pursuit of their constituency and parliamentary duties. Although it has been proposed by the SSRB, it follows from extensive evidence from Members of the House, and remedies much of the frustration that Members have expressed with the present system.
The new package gives three major benefits. First, Members' staff will be put on a consistent and fair salary structure for the first time since Members started to hire staff.
Secondly, all Members will have access to a standard package of IT equipment that will guarantee them access to the latest technology in a compatible format.
Finally, the overall effect of the package will be a substantial increase in the resources available to Members.
I shall come to that later, and I shall be happy to give way to the hon. Gentleman then.
The financial equivalent of the new package will total about £80,000 for most Members.
The previous system needed fundamental reform. It was hard to justify a system which led some Members with heavy case loads to rely on volunteers and foreign interns because they could not afford enough permanent staff. It was even harder to justify a system that obliged a number of Members to dig into their own pockets to make up the pay of their staff. Nor can we justify trading on the high motivation of our staff by paying them at a lower rate.
I am well aware that many Members, particularly new Members, face pressing decisions on the recruitment of staff. I have therefore tabled this resolution, and the other resolutions before the House, to have immediate effect. The result is that, from today, Members will be entitled to a pro rata share of the new annual allowances for staff pay.
The resolution puts before the House the new ceilings proposed by the SSRB—an annual ceiling of up to £70,000 for Members with a London constituency, and £60,000 for Members with a constituency anywhere else. The differential is the single issue on which I have received most representations from hon. Members, and I am not in the least surprised that it has attracted an amendment. The Government are not offering any advice to the House in respect of the amendments to the resolution that have been tabled; they are matters for House to resolve.
It is plainly right that the ceiling for London Members should reflect the higher staff costs that they must necessarily pay in the London labour market. However, many Members with constituencies outside London also employ staff at Westminster. It is a fact of geography that Westminster is in inner London, and all members of staff employed at Westminster will be paid at the same higher London rate, whatever the constituency of their employer. The amendment tabled by my hon. Friend Mr. Soley therefore offers a pro rata increase in the ceiling for Members from outside London who employ staff at Westminster.
Will the Leader of the House comment on the two amendments that I tabled? They have not been selected for debate, but the right hon. Gentleman may be able to satisfy the House on their subject matter.
Will the Leader of the House give way so that I can ask him to comment on an issue that has arisen in the midst of the debate? The SSRB suggests a ceiling of £60,000, but it would appear that its arithmetic relates to the headline salaries, which when added together already reach that ceiling. National insurance contributions do not appear to be included. Would the right hon. Gentleman therefore consider allowing those contributions to be paid centrally?
Secondly, given that the proposals may involve a number of Members shifting some of their staff and some of the functions of their staff from Westminster to their constituency, it is inevitable that some people may be made redundant. For the sake of our staff—not for us—will the right hon. Gentleman therefore contemplate making statutory redundancy pay provided for centrally?
I may not be able to help the hon. Gentleman on his first point, but I can clarify matters. It is important that right hon. and hon. Members should understand what is proposed in the tables of the Senior Salaries Review Body's report. It sets out staff pay rates and makes it quite explicit that the employer's national insurance contribution should also fall to be paid out of the overall ceiling—in other words, the £60,000 for Members outside London and £70,000 for Members inside London must also provide the payment for national insurance contributions by employers. It is important for right hon. and hon. Members to reflect on this point. That 10 per cent. contribution can make quite a significant difference to the final year outturn, as I know to my cost from previous experience.
On the hon. Gentleman's second point, the standard position is quite clear and does not change with the SSRB report, as far as I understand it. If staff are faced with redundancy as a result of their Member losing his or her seat, redundancy payments will be met. If they are made redundant as a result of the Member restructuring the office—for example, moving it from the constituency to Westminster—that cost falls to be met out of the allowances.
I appreciate that, in phasing in the new system, there will be particular cases to consider. That is why we have taken the power, through the Speaker's advisory panel, to make sure that we can be flexible, and that where there are bona fide cases, we can respond to individual difficulties. In addition, I stress that there is a transitional period. Until April 2003, right hon. and hon. Members can continue with the present arrangement before transferring, and that should help to ease some of the transition problems.
I should like to move on from the ceilings to the new arrangements for incidental expenses.
I am grateful to my right hon. Friend. It would help the House if he clarified how staff salaries can be protected in the future. We know what is on offer as of today, but can my right hon. Friend assure us that staff salaries will be protected throughout this Parliament and into the future?
I am not in a position to give my hon. Friend an assurance if he is referring to future uprating. That lies in the hands of Hay Management Consultants, the SSRB and the authorities. However, it is not our intention to allow Members' staff to suffer. Indeed, my overall impression from the proposals is that the majority of staff will welcome the proposals and package, and will also, in many cases, benefit from the rates of pay set out in the appendix.
If my hon. Friend means by his question to ensure that Members' staff will not face a decrease in pay, I draw his attention to that part of the SSRB report in which the point is made that some Members' staff may have a higher rate of pay at present than allowed for in the appendix. In such circumstances, the SSRB recommended that their pay should be frozen until such time as the pay levels caught up.
As I stressed earlier, this is a radically different system. On balance, it will be better for Members and for their staff. There will be some awkward and difficult cases, which is why it is important that we provide ourselves with some flexibility to respond to individual circumstances.
I was about to turn to the incidental expenses allowance.
The SSRB report contains a specific proposal that where there is any legal contractual responsibility, the Fees Office should be able to assist with it. However, I stress that I do not envisage the outcome of these changes to be that Members' staff face a decrease in pay. At most, there may be a necessary period of transition in which they wait until the pay scales catch up. For most Members' staff the rates set out will represent an increase, not a decrease.
I must make progress if the House is to debate these motions. The incidental expenses allowance is set by the SSRB at £14,000. "Incidental" possibly does not do justice to the essential items which this budget must cover, including office rent and rates. The figure proposed by the SSRB incorporates an estimate of constituency spending as assessed by Hay Management Consultants. However, many Members, and if I am frank, my own constituency staff, have questioned whether this figure adequately provides for all the items that Members may have to meet in the course of a full and unpredictable financial year.
My hon. Friend the Member for Ealing, Acton and Shepherd's Bush has an amendment to the ceiling on incidental expenses. It is for Members to reach their own judgment on that amendment in the light of their own practical experience of running constituency offices.
One problem of the previous system, which Members will know from practical experience, was that a capital purchase could knock a big hole in that year's allowance. One major gain from the new package is that we will never again have to weigh the necessity of purchasing a new computer against the amount that would be left over for staff pay. The new package responds to frequent representations by Members that we should move to centrally funded and managed procurement of IT equipment. Under the terms of the resolution—
I have already given a commitment to make progress.
Under the terms of the resolution every Member will be entitled to three personal computers, one laptop and two combined printer/scanner/copier/fax machines.
Will the Leader of the House confirm that the IT equipment will at all times be owned by the House of Commons authorities? He will be aware that at the time of the dissolution of Parliament for a general election former Members are not allowed access to House facilities. Does that mean that desktop computers in one's constituency and possibly one's laptop allocated by the House of Commons authority under the scheme would be repossessed for the duration of the general election, in which case we would have to buy ourselves a separate machine?
The hon. Gentleman is correct on his first point: the equipment, having been purchased by the House, will belong to the House and not to individual Members. However, it will be at the disposal of the individual Member until the end of any general election. I stress that it is part of the provision that it should be used only for parliamentary functions, not party political purposes. While it may be right that a Member's staff should continue to deal with constituency correspondence during an election, equipment should not be used for election purposes. [Hon. Members: "Hear, hear."] I am glad to see that all Members of the House are nodding sagely in agreement.
These items will be provided centrally by the Parliamentary Communications Directorate, which will also provide free installation at Westminster or in the constituency, free training on the equipment and free maintenance.
It is my understanding that the House authorities have anticipated the passage of this motion in relation to procurement and have already entered into a contract with Compaq. The Leader of the House knows that I have in my constituency a major computer manufacturer, evesham.com, which makes the Vale range of computers. It was excluded from bidding for the contract. Indeed, I think that all other manufacturers were also excluded. [Interruption.] I am sorry that Government Members do not think that public procurement should be conducted openly. It should be, as an amendment on the Order Paper suggests. Will the Leader of the House give a commitment that next time there will be a full, open advertisement for this procurement process and that all manufacturers will be able to bid for the right to supply the House?
I hear what the hon. Gentleman says and I am sure that his constituents have heard it also. I assure the House that the arrangement has been made through standard public procurement rules, albeit by a process of negotiation, not necessarily open tender. If in future a better package becomes available, it must be considered. That stands to reason.
I commend the Fees Office and the Parliamentary Communications Directorate on the work that they have already done to ensure that we can implement the plans once we have taken a decision. We are facing a massive new logistical exercise which will require the installation of possibly 4,000 items of kit in more than 600 locations. Hon. Members will be able to work out for themselves that that will not happen instantaneously, so I hope that the whole House will understand if we give preference to new Members who have come into the House with no office equipment.
Before concluding, may I say that I would regard it as wholly unfair if tomorrow the increases in our office costs were written up as some kind of perk? No other profession, even including—dare I say it?—newspaper editors would expect the reasonable costs of a secretary and a word processor to be treated as if they were part of their personal remuneration. Nor should MPs. Our staff are there not as a perk to us, but as a service to our constituents. We will be better able to provide that service to our constituents as a result of the proposals of the SSRB.
Although Members may differ from the review body on a number of points of detail, I hope that, in the following debate, we shall not let that obscure the broad welcome for the major improvements of the new package. It represents a radical reform of the way in which our offices are supported. It will bring our offices up to date in access to modern technology. Furthermore, it will ensure that the staff who work hard for us and for our constituencies will get a fair rate for the job. The overhaul is long overdue and I commend it to the House.
I shall try not to detain the House unnecessarily, as the matter is one for the House and Back Benchers have tabled amendments to which they want to speak. However, it is important that I raise at the beginning of the debate the points to which I want the Leader of the House to respond at its conclusion, so that we have a record of answers on some unclear issues.
In relation to the ring-fenced budget for staff employment, the Leader of the House referred to appendix E in the SSRB report. Paragraph 3.12 of the report describes that appendix as "a possible guide". Nothing in the motion suggests that the Government have adopted the guide printed in appendix E. Will the Leader of the House confirm that the pay rates attached to the job descriptions in the appendix are in fact the rates that the Government are recommending in the ring-fenced budgets of £60,000 and £70,000? If they are, the sums do not add up.
Let us examine the recommended pay scales together with the review body's statement that such a level of staff remuneration would enable an MP to employ up to the equivalent of three full-time staff, who I accept may not all be London based. When the employer's national insurance contribution of 10 per cent. is subtracted from £60,000 gross, we are left with £54,000 net, which means that there is no way that a Member could employ two senior and one junior full-time members of staff as the report recommends. That is why I, like the Members who have tabled amendments, press the Leader of the House seriously to consider meeting centrally the deduction of £6,000 for the employer's national insurance contribution. If that is not done, the figures will not add up. I should be happy to go through the sums with the House, but if Members have a copy of the report, they will be able to see for themselves.
I refer the Leader of the House to changes made to the arrangements in the Scottish Parliament last month whereby employers' national insurance contributions are met centrally for staff employed by Members of the Scottish Parliament. I hope that the right hon. Gentleman will be willing to follow that precedent.
Does my hon. Friend accept that the issue is complicated by the use of median rates, which represent the middle of the band? Some hon. Members have staff of long standing who have been in the House for many years, and they will be at the higher rates of pay, especially if the Member has been here for a long time, so the adding up becomes even worse at the higher end of the band. Furthermore, the rates of pay were assessed in October 2000, so a year will have passed by the time they are implemented, and they are out of date already.
Yes, my hon. Friend is right. I want to pick up the issue that he has just raised, to which the Leader of the House referred in respect of existing contracts that are well above the rates recommended in appendix E. Although the Leader of the House rightly said that transitional arrangements would be available, I am not sure about the suggestion that, under an existing contract of employment, it would be possible to demand that staff accept a pay freeze until the rates equalise. I do not know whether the right hon. Gentleman is sure about that either and if he is not, we need to take specific legal advice. An employer may not be able to honour annual increments as outlined in contracts of employment because of financial constraints, but I am not sure whether we can legally demand a pay freeze on existing contracts. I hope that the right hon. Gentleman will reassure the House that legal advice is being sought from employment lawyers on that very important point.
In section 3.16, the report suggests that Members could also make ad hoc payments to cover research and staff absences from the gross figures of £60,000 and £70,000. Many Members use secretarial bureaux from time to time and have an ad hoc input from data processors, and even more pressure is put on the gross figure when that is taken into account. I urge the Leader of the House to reconsider whether we should have to accommodate the 10 per cent. employer's national insurance contribution in the gross figure.
I have been trying to follow the hon. Lady's figures, and I am a little puzzled by her statement that the review body's report does not envisage staffing arrangements that can be included in the £60,000 sum. In section 5.8 on page 29 of volume 2, the review body offers four different arrangements, all of which it suggests would be suitable.
I was referring to the appendix that the Leader of the House mentioned. I assumed that it was appendix E, which shows the Hay scale—six different job descriptions with separate London and regional rates. The SSRB recommends that a Member should be able to employ three full-time equivalent staff—two at a senior level and one at a more junior level.
Let me use the inner London scales to make my point. The appendix suggests that it would cost £28,500 and £27,000 respectively to employ two people, one at the executive secretary/PA rate and a one at the research assistant or constituency assistant rate, which are not the very highest rates. In other words, it would cost £55,500 to employ just those two people. That does not leave room for a full-time equivalent post, even at the bottom of the regional rate—a constituency assistant with a recommended salary of £12,500 on that scale. That is why I seek clarification.
If we are working to the pay scales outlined in appendix E, it is very difficult, taking into account employer's NICs, to meet the SSRB's requirement that we should employ two full-time equivalent staff at a senior level and one at a more junior level. Even using the regional, outside London, rates, it is difficult to fulfil those criteria.
I shall give way, but I hope that the hon. Gentleman will understand that I want Back Benchers to contribute to the debate and to have their say.
If we are working to appendix E, the arithmetic is very simple. If we are working to a different scale, it is a different matter. There is reference to the fact that the SSRB also considered the rates recommended by the Transport and General Workers Union. When we talk about the gross sums and employing three full-time equivalent staff, we need to know which scales and which recommendations we are considering, especially as that is not made clear on the Order Paper. I hope that the Leader of the House will confirm that I have understood him correctly and that we are considering the pay scales as recommended in appendix E of the report. Does Dr. Palmer still want to intervene?
I am grateful to the hon. Gentleman.
Moving on to the transitional arrangements, I have already mentioned the fact that some hon. Members are concerned about existing contracts and the recommended rates, but I wonder whether the Leader of the House will clarify what the position will be for existing shared staff. Sometimes a senior secretary will work part time for two Members, but the pro rata part-time rate is not exactly 50 per cent. of that for a full-time equivalent post. In most workplaces with jobs that command lower salaries, the pro rata rates for part-time staff are often exactly 50 per cent. if the job is done for exactly half the time. In more demanding jobs, often to attract part-time staff, more than 50 per cent. of the full-time equivalent rate has to be paid. That is already the case in some contracts where two Members share a secretary. For those people, the gross salary that the secretary receives from two Members is higher than the rates outlined in appendix E. Again, apart from the problem of hon. Members employing someone on much higher rates, hon. Members seek clarification of those shared arrangements, as well as the shared arrangements for equipment that also exist in some cases.
I shall now deal with the incidental expenses provision. It is extremely good that the right hon. Gentleman has aggregated the £9,000 and the £5,000 sums and put more flexibility into the provision. I thoroughly support that proposal, and I am very much aware of the amendment under which that sum would be increased to £18,000. Every hon. Member's arrangements will be different, but there is concern about those who may have a set up a constituency parliamentary office from scratch, or who do not have the opportunity to share such a facility, perhaps with an existing association office.
Taking out a lease and all that goes with it can be quite challenging for anyone in business, but from our point of view, taking on a lease on premises out of that budget could cause some problems. For example, full-repairing leases are often used. In other words, at some time during the tenancy, one must carry out repairs to the roof or overall decoration inside and outside the premises. The normal running costs may be deemed to be £14,000—or perhaps the House will agree to £18,000 today. Bearing in mind the fact that I believe that we still cannot carry forward surpluses year on year to budget for a bill that we know comes up every four or five years—for example, to fulfil the requirements of a full-repairing lease—I wonder how hon. Members might meet those obligations under normal commercial leasing conditions.
The Leader of the House said in his opening remarks that he had effectively been subsidising his constituency operation out of his own income. That is probably true for very many hon. Members. The provisions before the House distinguish between those Members with staff in London and those outside London, but no provision is made for those Members who choose—it is a choice—to have their offices outside the House of Commons and who do not therefore benefit from the space, heating, lighting, telephones or any of the other equipment provided in the House. I have chosen to subsidise my constituency office to the tune of about £10,000 a year for the past 15 years. I wonder whether there should be some flexibility in the arrangements to make provision for those who choose to have their entire operation outside the House rather than in it.
I am sure the Leader of the House will respond to that point. I understand that the flexibility built into the general services budget would allow for that. It is based on the fact that people need a constituency base, whether it is physically in the constituency or not. That sum has been identified by the SSRB as meeting some of the costs that my hon. Friend mentioned.
I have raised the matter of insurance privately with the Leader of the House, and I would like his reassurance on the record. He mentioned insurance in relation to indemnity for MPs, and I totally agree with the proposal on the Order Paper, particularly in respect of the Foreign Secretary. However, if one sets up an office in a constituency, one requires employers' insurance to cover employees and public liability insurance for people coming into the premises.
Are all those costs to be met centrally on behalf of all Members, regardless of the location of their offices, or would such insurance have to be purchased separately out of the incidental expenses provision? If it were provided centrally, it would clearly not be such a liability and the House could presumably negotiate a good deal because the contract would be large. If MPs had to purchase insurance policies individually, they would represent a charge on the incidental expenses provision.
Will my hon. Friend also impress on the right hon. Gentleman the anomaly that, despite the proposals providing for up to three full-time staff and the equipment for them, many of us do not have the space in this building in which to put them? Parts of the new buildings provide suitable facilities for more than one member of staff for most Members, but Members who are in this building are entitled to only one desk. That is not adequate for the secretaries and equipment with which the motion seeks to provide us.
I have every sympathy with my hon. Friend, and I am sure that the Leader of the House has taken his concerns on board. We are all concerned about that. After nine years in Parliament, I do not think the problem of how and where staff are accommodated is getting any easier, despite the fact that we now have Portcullis House.
The Leader of the House will be aware of the amendments tabled by many hon. Members relating to the information technology package. I am concerned about the public tendering procedure that has been used. I am even more concerned that the equipment has been procured with, as I understand it, no reference to the needs of Members of Parliament. Members of Parliament, the users—the customers, as it were—have not been consulted on the package.
For the hon. Lady's information, there was very close co-operation on these proposals throughout the previous Parliament between the Officers of the House and the members of the Information Committee. The Committee—working on a cross-party basis and including the former Member for South Dorset, Ian Bruce—was fully behind the proposals. The Officers were very careful to ask Members, as representatives of that Committee, what they wanted.
The package of kit might have been the subject of consultation, but the procurement of specific brands was certainly not. As I understand it, the report that the Information Committee produced, which was considered by the SSRB, says quite clearly that Members sought a choice. Members have not had a choice, particularly in relation to branding. We had hoped for a menu of brands from which Members could choose. In fact, that did not happen. I raise that matter with the Leader of the House because that is not the way to procure such equipment in future. We are all, as end users, entitled to a say in what our preferences and needs are.
The right hon. Gentleman paid tribute to the work done by the Parliamentary Data and Video Network in trying to procure the information technology package. However, in response to many Conservative Back Benchers' comments, I must say to him that if PDVN is to have such an executive role in the procurement and management of IT in the House, it will have to raise its game in terms of consumer service and consumer awareness. It must provide a flexible, high-quality service to Members. The Leader of the House might wish to consider this matter separately and take soundings from Members across the House about the level of service that we get. All too often we are greeted by answerphones, and it often takes a long time for phone calls to be returned when there is a problem. If this were a commercial environment, customers would be leaving in their droves. I hope that the Leader of the House will now guarantee to do something about the service; it has to become customer-oriented.
Is my hon. Friend aware that, when the House is still sitting after 6 o'clock, there is only one person on the Parliamentary Communications Directorate helpdesk because adequate funds are not being made available by the House authorities to the PCD? I hope that the Leader of the House will ensure that, as we have an almost 24-hour job, the PCD will be able to provide an almost 24-hour service.
I hope that the Leader of the House will assure us that it will be a high priority for him personally to ensure that this matter of great concern to Members will be dealt with as effectively and quickly as possible.
Order. I am sorry to interrupt the hon. Gentleman. I must say to the House that we must deal with the motions before us, and not other matters that have been raised during interventions. Also, I am keen to call as many hon. Members as possible to speak. For that, I need the co-operation of the House, and I would expect brief contributions.
I was about to say that I was very aware of the constraints of time. It will be very difficult to fit everyone in, so I shall focus most of my comments on the amendments tabled in my name. However, if I may, I shall also make a couple of opening comments.
First, I welcome the latest report from the SSRB and thank the board for it. I felt that it had got the previous one wrong, but it has got this one largely right. Perhaps I would say that, because the report largely follows the evidence that I gave on behalf of the parliamentary Labour party. It also represents a radical break from the past, gives a far better service to MPs and enables them to serve their constituents better, while entrenching the rights and privileges of our staff, on whom we depend so much and who have been seriously undervalued, underestimated and under-protected in the past.
Secondly, measures of this nature are inevitably extremely complicated, especially when making a change of the kind that I recommended and that the SSRB is following. We shall not be able to cross all the t's or dot all the i's in this debate, and one of the things that I most welcome—perhaps we can refer to this on other occasions—is the setting up of a Speaker's advisory panel to include Members of Parliament. We shall then be able to iron out many of the problems as we proceed over the next year or two. I will mention one of those problems in a moment—Mrs. Browning has already mentioned one or two—but we should not try to solve them all here now, because we shall not be able to. If I had been able to do so in my evidence, I would have done so, but because of the radical changes that we are making, we need to get this right.
I shall make a brief comment on overall pay. I have always taken the view that we are too shy and retiring on this subject. People recognise that MPs need a proper rate of pay for the job. My right hon. Friend the Leader of the House put it correctly when he said that a balance must be struck between not underpaying and not overpaying. My experience is that when we ask the public what they think about politicians generally, they have a low opinion of us, but if we ask them about their individual MP, they speak highly of the amount of work and commitment that that MP puts in, even if they do not agree with him or her politically.
We therefore make a serious mistake if we buy the newspaper line that all politicians are hopeless. Indeed, if my hon. Friend Mr. Mullin had his amendment adopted, I would have said to him that he had chosen exactly the wrong group—the way to deal with this matter would have been to link MPs' pay to that of senior journalists and editors. That would fundamentally have changed the nature of the debate. Indeed, if we had linked our pay to that of editors, we would all be being driven home in limousines at the end of the day.
Journalists and MPs have a special relationship and, as my hon. Friend the Member for Sunderland, South said, it is important to recognise that MPs must be properly resourced if we are to make our democracy work. That means being able to respond appropriately and fully to the needs of our constituents. It also requires us to be able to hold the Government to account and undertake the other tasks that we want to fulfil in Parliament. For that, we must have the appropriate research back-up.
Few Members here would disagree that MPs should be properly rewarded, but are we not forgetting that if we are to be paid the proper rate for the job, and I suggest that we are, it would be right and proper to take a fresh look at whether we should be able to engage in outside business interests? If we are being paid a full-time rate for a full-time job, what on earth are we doing moonlighting?
I am pleased to say that there are far fewer moonlighters than there used to be. Having said that, as one who does not have an outside job, I take the view that we must acknowledge that MPs need a proper rate of pay for the job. If they do their job, I am not so worried about what they do at other times. However, I would be extremely worried if Members frequently earned large sums in other jobs, and I am glad that we have rowed back on that. We must be careful about where we draw the line, because any of us might earn money by writing an article or writing a book, which seems to be popular from time to time.
I must move on to discuss my amendments, but I should first refer to our staff. Most MPs think that they are good employers, but in my experience many of us, even with the best of intentions, are not. That is one reason why I argued so strongly that MPs should have the right to hire and fire, but that the general administration and servicing of staff should be done by the Fees Office. That would have two enormous advantages, and the first is that it would create transparency for the public.
Our old system was faulty because people could not see the money going straight to our staff, even though that was where it went. In many cases, Members had to put their hand in their own pocket to pay staff. However, some staff got a poor deal, so we must act. The report provides appropriately for that, which is the second advantage, and I hope that our vote today will make the position solid.
We have to set a maximum value for the pay of our staff, and the judgment is how many staff a Member needs. When I gave evidence, I said that, in my judgment, an MP needs between three and a half and four staff. The SSRB said three. It then produced a salary scale, to which the hon. Member for Tiverton and Honiton referred. We may want to revisit the issue through the Speaker's advisory panel, because we do not have it quite right.
I would be reluctant to table detailed amendments before we have had time to see how the proposal works, and I ask Members to bear in mind the fact that it represents a radical improvement. We are moving in the right direction and setting up the structures to deal with these matters, which is the important point.
I am always brief, so that is not a problem. Can my hon. Friend explain why no consideration was given to setting minimum rates? MPs have been left in an open position. We should avoid the problems of pay freezes and reductions, which are endemic in the proposal.
I am not sure that my hon. Friend is right to use the word "endemic". What are proposed are pay scales that, contrary to rumours going around the House, are set not by the Transport and General Workers Union but by Hay Management Consultants, which has considered the pay range. He will be able to appoint his staff at any point on the scale and there is an uprating procedure, to which the hon. Member for Tiverton and Honiton referred. We must consider certain specific problems, however, and, in the light of my hon. Friend's intervention, I shall deal with them now, beginning with a classic example.
We may need to revisit and refer back to the SSRB the circumstances of a highly skilled, highly qualified secretary who has been employed by an MP for a long time. I employ such a person. If such secretaries went to work outside the House, they would earn considerably more than they are paid here. We need a means to pay a person with specialist experience, knowledge and long service, so I hope that the matter is referred back to the SSRB through the Speaker's panel. I shall work to achieve that, because we do not have the answer at the moment.
I thank my hon. Friend for giving way. Will he take it from me—or perhaps he already knows—that a person employed by a Greater London Authority Member would start at close on £25,000 as a caseworker and researcher? For many of us who represent inner-London constituencies, that is the yardstick to which we have to work.
I understand my hon. Friend's point, but I cannot add to what I have said. However, I remind Members that the proposal represents a radical improvement and a big step in the right direction. We must build on it, pick out the anomalies and deal with them over the next year or two.
The safety of our staff is incredibly important. The Liberal party suffered a tragic experience in that respect and, although we all think of it as a special case, we know that we sometimes ask our staff to deal with disturbed people. Over the years, Members have done research on their surgeries and I have to tell the House that people with severe paranoid disorders often visit MPs. After all, if a submarine is interfering with a person's brainwaves, who else can that person go to but his MP, who can get the Secretary of State for Defence to make it stop? We sometimes ask our staff to deal with seriously disturbed people and we should not underestimate the demands involved in such a request. That is why I am pleased about the recommendation on safety.
Amendment (o) is straightforward and Members will understand it, but there is a complication that I want to point out. I am aware that many Members employ their staff in London even though they are not London MPs, and my amendment addresses that. When I read the SSRB report, I realised that we had to make a change, but there is a difficulty which I ask Members to bear in mind.
I have taken helpful advice from the Fees Office on the wording of the amendment in order to get it right. A Member who represents a seat outside London but who employs someone here will be able to get the extra £3,500. However, matters will get very complicated for Members if they attempt to break the work up. Staff may be employed part time and I know that it is common for Members to employ someone in London when the House is sitting, but in the constituency when the House is not sitting. I strongly advise Members to talk through such an arrangement with the Fees Office first; otherwise, in certain limited cases, they will run out of money before the end of the year. We must monitor the situation closely and, if necessary, ask the Speaker's panel to address it.
I have already referred to the long-service award, so I shall pass over it. Amendment (d), which is also straightforward, would move the incidental expenses allowance up from £14,000 to £18,000. The SSRB set the figure too low. The media may want to pick up that point and say, "They are giving themselves £4,000 over and above the SSRB recommendation", so let me spell out the importance of the amendment.
Every Member is like a small company. I have tried several times to get a feel for the way in which MPs operate and almost every one operates differently. The amendment would take payment of staff out of the office costs allowance and enable us to deal with it separately. We should establish a pot of money that Members could use flexibly and, within the constraints of parliamentary duties, in any way they liked. The report makes clear how the SSRB reached the sum of £14,000, made up of the rental of accommodation plus a pot of £5,000 for incidentals. That pot is interchangeable and remains so in my amendment which would increase the allowance to £18,000. Members may use it as they like so long as it is for parliamentary duties.
I should like to conclude by giving the House a few examples as it is a matter that has frustrated me for many years. I suspect that our constituents want their Members of Parliament to be innovative and develop new ways of working.
Soon after I was first elected, I got involved in Northern Ireland issues. During the dirty protest and what became the hunger strike, I visited some of the prisons. I wanted to visit a prison in southern Ireland which was experiencing similar problems, of which, as a former probation officer, I had some knowledge. We bent the rules slightly inasmuch as my fare was paid even though I was not on a Select Committee and I was on the Front Bench for only part of that period. However, I could not go to Dublin and visit the prison there, so we did daft things like buying a return ticket to Belfast, converting it to one that came back from Dublin and paying the difference or getting the train from Belfast to Dublin and paying the fare ourselves.
The problem has not gone away. If Members representing southern constituencies go to visit the new Parliament in Edinburgh, they can get their ticket paid, but if they stay overnight and make it a two-day visit they will have to pay the difference themselves. It is ludicrous. German Members of Parliament have all their travel paid. One of the recommendations of the Fees Office to the SSRB was that about £4,000 should be set aside for that type of travel. I have tried to deal with the issue by putting the money into a general pot. Many hon. Members have pointed out that £14,000 is not sufficient to pay for the rental of a constituency office and the telephone bill. That has been one of the biggest complaints, so rather than propose an amendment that would allow for the payment of telephone calls, as that would cause many complications, I simply proposed increasing the allowance.
Does the hon. Gentleman think that his amendment deals adequately with the point raised by my hon. Friend Mr. Gale—that those of us who seek to provide office accommodation in our constituencies are meeting a huge range of costs that would otherwise be met in this building, which means that we will not have the resources for journeys and overnight stays in Dublin such as the hon. Gentleman has described?
The answer is that some people will and others will not. Some Members spend £10,000 or more a year on rent. Others are paying only £2,000 or £3,000 a year, often because they are in substandard accommodation and, for a variety of reasons, are paying below the market rent. We cannot get a typical picture, but the hon. Gentleman should recognise that the proposals are a great step forward.
I have often been praised for setting up the evidence-taking sessions. I thought that there should be more such sessions in the House of Commons. The ones on the press Bill were largely paid for, but the ones on the working of the family and on family policy in the country at large were not, so I ended up paying for them myself and getting outside organisations to contribute. If we want Members of Parliament to work innovatively, we ought to be able to carry out such research. In the long run, through the Speaker's panel and perhaps by referral back to the SSRB, we will need to find other ways to improve and expand on this package.
If people want good representation—I know that they do—and if they want their Parliament to be more effective, we have to pay for it. Democracy does not come cheap and if we want good-quality democracy and good-quality Members of Parliament who are well resourced, we are taking a big step in the right direction. We have not got it all right today, but I ask hon. Members to vote for my amendments and for the proposals we are considering today.
I am sure that all parties are having a free vote today, so it follows that what I have to say today is in no way a party line. I have consulted my 51 right hon. and hon. Friends and have had conversations with a great many other Members, so I hope that my speech will at least be reasonably well informed.
From the previous debate on salaries and allowances I recall several high-minded speeches in which Members said that they would vote against the increases for various reasons and, no doubt, with good motives. With that in mind, when the SSRB report became available earlier this year I asked the then Leader of the House how many hon. Members, in the current financial year, voluntarily elected to forgo any or all of their parliamentary salary. I wonder whether anyone can tell what the answer was: it was, of course, a resounding nought.
I can assist the hon. Gentleman. I took the view that I could give away the proceeds of that last outrageous salary increase more effectively than my right hon. Friend the Chancellor could. I have been taking the increase for the past five years and diverting all but 3 per cent. of it to a donations account, which I give away to good causes of my choice.
That is admirable, but my next point follows precisely from that. I have given away between 15 and 20 per cent. of my salary to my staff. I have had to do that because, as the Leader of the House said, to do a good job of work we have needed staff to provide a service to our constituents and to the nation. We are here not only as constituency Members; as Edmund Burke said, we also represent the whole nation. Mr. Mullin obviously has a very large majority and perhaps he does not have to provide quite the service that I have to provide in North Cornwall, but I can assure him that in a very scattered rural area the staffing required demands a level of resources that has not been available in the past. That is why I entirely endorse the point made by Mr. Soley.
I understood the points that were made in the previous debate, but all right hon. and hon. Members will recognise that what we are doing today is not voting ourselves increases in salaries and allowances but trying to ensure that we properly resource the services that we provide to our constituents and to the nation as its representatives. Surely that must be what it is all about.
As I said in a previous debate, there are opportunities for humbug, but there are more opportunities for humbug among the media. I recall that the hon. Member for Sunderland, South was a professional journalist before he entered politics, so the proposal by the hon. Member for Ealing, Acton and Shepherd's Bush is entirely right. If we tied our increases to the remuneration of senior journalists, I suspect that we would have less humbug from the fourth estate. They do not provide their own staff, equipment or offices. Frankly, they do not have a clue about the costs that we have to incur.
Timing is an issue. I very much regret the fact that we are debating this now rather than before the general election. I said publicly and privately to the previous Leader of the House that we should take the matter to the electorate to see what they had to say. Interestingly, despite the fact that all the proposals were in the public domain and were well publicised by the newspapers, I do not recall a single comment from any member of the public during the recent general election. That entirely endorses the point made by the hon. Member for Ealing, Acton and Shepherd's Bush: that although respect for the reputation of Parliament as an institution is pretty low, individual Members representing all parties have a high rating when it comes to serving their constituents. There is growing recognition of that, on which I hope the media will reflect in future.
There are still some important teething problems in the package before us, but that should not obscure the fact that we now have a mechanism by which others outside this place look at the work that we do, provide appropriate comparators and seek to make an objective assessment of what we and our services are worth. We would break that tradition at our peril. That is why I oppose the amendment proposed by the hon. Member for Sunderland, South; as soon as we bring in different comparators, everyone will come up with something that is thought to be more appropriate. The SSRB may not be perfect, but it is certainly a great deal better than the House, in effect, contemplating its navel and trying to decide in a very unfortunate way how we should deal with these matters.
The SSRB asked what a person in a comparator job would be paid. Does my hon. Friend accept that, in determining what we should be paid, that is only half the question? Unlike an NHS manager, we are expected to be representatives and to understand the living standards of our constituents. If we merely say that we do the same sort of job as a senior civil servant and so should be paid the same, there is a danger that we will lose touch with our constituents.
I hope that my hon. Friend will have an opportunity to develop that interesting argument. The problem is that, although we look for comparators, the job of a representative of the nation in this place is unique, so it is extremely difficult to find a completely relevant comparator. I take my hon. Friend's point, but I think that he is asking for perfection.
Reference has been made to the role of the Department of Finance and Administration in developing the package of proposals. It will have an extremely difficult task precisely because this is such a unique institution and our job is so unusual. The role of the Speaker's advisory panel will be very important, especially in the transitional phase. It is unfair on Officers of the House to ask them to make political judgments—these are policy issues. The advisory panel will have an important role to play. Mr. Speaker, you and your staff will have to bear a significant added work load, especially in the new system as it develops. We who put that load on you and your staff must be conscious of that.
I do not want to say anything more about salary, because I accept the SSRB recommendation. Although many of us may have concerns about some of the proposals at the fringes, we must maintain the integrity of the package if we can—on that, I am with the Leader of the House. If we ask people outside to make a careful assessment of what is right but then start to play with that assessment, we will open a can of worms.
It is important to remember that the allowances are ceilings; they are not recommended expenditure or perks. We are not being given some money and told to take it. Whatever the allowance may be, individual Members of Parliament may go up to that ceiling for that purpose. Not every Member must go up to the ceiling or feel that that is necessary. I am full of admiration for Members who are able to provide a service to their constituents at a lower rate; that is fine.
It is important that we do not accept the whole of the SSRB report, and the appendices produced by the consultants, as though they were written in stone. It is clear from the table to which Mrs. Browning referred that Hay did not really get under the skin of Members of Parliament. There is no reference to a case worker. Most Members of Parliament have someone who does case work as a key function in their constituency office. Similarly, it is clear from the job descriptions in that appendix that there will be mixes of different types of operation, and every Member may have a different mix. The motion is not saying that that is how it will be done: it is merely an illustration, and the figures given are median figures.
In addition to the point about national insurance contributions and redundancy figures, there is the extremely important issue of whether these are salary ranges or salary scales. I know from my business experience as well as from my experience in the House that those two things are very different. People on salary ranges may be told, "You'll start there and we'll see how you go." Salary ranges have the important function of ensuring that there is not a glass ceiling on which people soon bang their heads, and are quite different from salary scales. I am sure that the Fees Office will be alive to that.
I understand that we shall be given some salary ranges before the recess, so it will be much easier to see how the issues to which the hon. Member for Tiverton and Honiton referred can be dealt with. The onus will still be on Members of Parliament to ensure that we remunerate our staff sensibly and properly, and that we devise realistic rather than artificial job specifications. It would be absurd if we accepted Hay's descriptions, which are not appropriate.
I take the points that have been made by hon. Members on both sides of the House about flexibility and about the fact that great care needs to be taken during the transition. We might have to come back to this issue in future, but the present motions offer helpful guidance without being too prescriptive.
I welcome the provision for security. My hon. Friend Mr. Jones knows only too well how inadequately and disgracefully we have protected our staff and our voluntary assistants in the past, because we have not had the resources to do so. I am sure that we all remember the tragic result of that failure.
I endorse the principle behind the special motion relating to Mr. Straw. It is important to note that it does not refer to him as the Foreign Secretary. We are not indemnifying an officer of the Crown. All Members of Parliament and their staff must be protected against the litigious actions of the public in the work we do on their behalf. I welcome what the Leader of the House has said on the insurance that is built into the package.
As I said at the outset, the Liberal Democrats have a free vote, so my advice is purely that and no stronger. I am worried by the amendments tabled by Mrs. Lait. Although I recognise their force, I think I am right in saying that they would negate the amendment tabled by the hon. Member for Ealing, Acton and Shepherd's Bush on the differential between London-based staff and the staff of London Members of Parliament. The logic of the report is that London-based staff will want London rates to apply. I am concerned that if we accepted the amendment of the hon. Member for Beckenham we could not incorporate amendment (o) tabled by the hon. Member for Ealing, Acton and Shepherd's Bush.
I do not know whether that is possible, but whoever replies to the debate may deal with that point. As I read the amendment, and according to advice I have received from the Clerks Department, it would negate amendment (o).
I confess that I have some difficulty with the issue of incidental expenses and the ceiling of £14,000 or £18,000. My parliamentary constituency office is not subsidised, but it has been located in its present premises for some time and the rent is relatively low. However, my hon. Friend Sue Doughty, who is newly elected to the House, faces a different rental market. She is an example of a Member who will find it difficult to rent reasonable accommodation that provides safety and security for her staff.
I entirely agree. As I said earlier, these allowances are not automatic—they are ceilings.
The hon. Member for Beckenham has also tabled an amendment on IT equipment and procurement. I listened carefully to the advice given by my hon. Friend Mr. Allan, who is Chairman of the Select Committee on Information. We must recognise that the procurement of IT is complicated and difficult. It is not brand choice, but specification choice that is of concern. It is what computers will do that concerns us, not who provides them. The Information Committee has done a very good job in that respect.
I have great sympathy with the amendment tabled by Mr. Betts on the additional costs allowance—the costs that those of us with constituents in other parts of the country incur when travelling to and spending time in London. I hope that he will explain the logic of his amendment. After all, the SSRB identified this as a real problem, but it was not asked to do so in relation to the House of Commons; it was asked to do so in relation to our noble Friends. The timing was unfortunate, in that when the inquiry was set up the board was not asked to consider the problem on our behalf. It is a particularly serious problem given the cost of finding accommodation in London, which affects all Members but especially new Members.
It is always tempting to follow the hon. Member for Sunderland, South, who is very persuasive, but I think that to tear up the arrangement we have reached with the SSRB and find a completely new comparator would be entirely misguided at this stage, and would open a Pandora's box.
When it comes to parliamentary pensions I take the advice of the trustees very seriously, as I think many Members will. None of us is here for ever, and although I have not yet reached the point of having a special interest—unlike the Leader of the House—I remember only too well, when I first arrived here many years ago, seeing some Members retire on derisory pensions. I therefore hope that Members will listen carefully to what is said by Mr. Butterfill.
My hon. Friend Dr. Harris asks for only one of the SSRB's recommendations to be put to the House for comment, at this stage, rather than being kicked into what may be rather longer grass than we intended.
The debate is important and many wish to speak, but let me reiterate one major point: if we decide to tear up the recommendations of those who have been asked to advise us on an objective basis, we shall become involved in some very invidious discussions in this place. I hope we shall not do that.
I support all that was said by my right hon. Friend the Leader of the House.
Many voices are missing from today's debate, because those involved cannot be here. I refer to the voices of our staff. I hope that at 4 pm we shall agree to move towards the proposed new system, but I also hope that members of all parties will first admit that we have been among both the best and the worst employers in the United Kingdom. I can confirm that from my experience as chairman of the staff liaison committee of the parliamentary Labour party, and from our association with the secretaries council.
Over the years Members have had the best staff they could wish for, both here and in their constituencies; yet we have consistently failed to support them by providing either proper equipment or proper salaries and conditions. The Transport and General Workers Union is on the staff liaison committee—representing staff of all political parties, not just Labour—and we have had to deal with cases of people whose salaries would shock most people outside.
Just before the SSRB's report, the TGWU conducted a survey whose findings are worth reading. Some staff salaries are shocking—regardless of the party for whom those people work—and bear no relation to the amount that we can claim in office allowances. As I have said, we are among both the best and the worst employers, but we certainly would not stand for some of these employment practices if we discovered them in our constituencies.
The debate gives us an opportunity to make progress. On behalf of the parliamentary Labour party, I and successive chairs of the PLP, dating back to the chairmanship of Lord Orme, have given evidence to the SSRB. At that time, in the first evidence we gave, we argued for a division between our responsibilities—a division between the way in which we hired and fired staff, and the way they were treated as individuals and employees. We argued for the establishment of a personnel department. Although that is not included in this recommendation, I feel that it is one of the issues that your advisory panel should consider, Mr. Speaker. We do need a proper personnel service to ensure that our staff are treated like normal human beings.
We also need to consider, as a separate issue, the equipment that our staff need in order to do their jobs. It has taken us a long time to reach the stage at which that distinction can be made. Many staff work, or at least did work, with obsolete equipment, because the Members for whom they worked could not afford to pay for new equipment. Conversely, many staff did not receive wage increases because the Member involved had bought some equipment instead.
All sorts of peculiar practices have gone on over the years. The review gives us an opportunity to proceed to a system that is fair to our staff, and makes us more accountable to those whom we seek to serve. As I have said, weaknesses remain; I hope that you, Mr. Speaker, will soon appoint your advisory panel, and that it will take account of some of the issues raised today.
Mrs. Browning mentioned public liability. Following an incident when parts of this building fell down and almost killed members of our staff, the Minister for Pensions, my right hon. Friend Mr. McCartney—who was a member of the PLP staff liaison committee—argued for the provision of public liability cover for every staff member. Each of us should have a public liability certificate displayed wherever we employ staff, both here and in our constituencies.
There are further outstanding problems that your advisory panel should consider, Mr. Speaker. For instance, our staff still do not enjoy superannuation conditions similar to those of other employees of the House or, indeed, of Members themselves. Under the current system, staff can qualify for a payment—we can claim on their behalf, but they cannot claim themselves—of 10 per cent. into a pension of their choice. That is ridiculous. If we do as most Members should do and increase the salaries of our staff each year, we must then increase their pensions as well—and the pension company, whichever it is, rips off the public purse by taking a percentage of the increase as a service charge. The sooner our staff are on a proper superannuation scheme, the better.
I do not want to labour the point, as I think it important for us to reach 4 pm very quickly. [Interruption.] I want to allow others a chance to speak. Let me say, however, that the voice of staff has been kept quiet too long here. I hope, Mr. Speaker, that your panel will provide room for representatives of both the TGWU and the secretaries council, to ensure that staff interests are looked after properly.
I entirely support the amendments tabled by my hon. Friend Mr. Soley. As I have said, we have waited many years for this day, and on behalf of our staff I thank Members in advance for voting for a proper structure for them.
I rise on behalf of fellow trustees of the parliamentary contributory pension fund and in my capacity as chairman of the parliamentary Members fund, the hardship fund set up to look after Members who fall into financial difficulties, or whose widows and children do so. That gives me a perspective on these issues that perhaps not all right hon. and hon. Members enjoy.
I was disappointed that the Government did not make their own submission on the issue of pensions to the review body. We fully expected that they would; I am puzzled as to why they did not. I understand that the only representation that was made was an oral one by a senior Treasury official. Hon. Members will not be surprised to know that that submission concentrated on the additional costs that would be involved if the amendment standing in my name and that of my fellow trustees were accepted. That may have been one of the things that influenced the recommendation that, sadly, the review body has made.
The review body and those who have taken part in successive debates on the issue have failed to recognise the fundamental difference between employment in this place and employment anywhere else. We try to encourage into this place people of the highest quality, from all walks of life, preferably people who have been successful in other careers, so that they can bring their expertise and make a valuable contribution to debates in this place. In doing so, we often ask them to give up extremely successful careers outside.
It is probably true that the majority of Members have taken a reduction in their income in order to be here. We all knew what we were in for, so there is no complaint about that, but the problem is that, on average, Members serve less than 10 years in this place. They have to pick up careers after they leave. Often, they serve the prime 10 years of their working lives in this place. I, as a trustee of the parliamentary contributory pension fund and as chairman of the parliamentary Members fund, have seen what the impact is on many Members who leave this place. They often do so involuntarily: they may be defeated at an election, the boundaries of their constituency may change, or they may suffer ill health.
After leaving, at least half of all Members are worse off than they were as Members. Probably many more are worse than they were before they became Members. Some are seriously worse off. There are still hon. Members who lost their seats in 1997 who remain unemployed. Many Members, particularly those who are older, in their 50s, found it very difficult to get decent full-time re-employment elsewhere, and have had to take part-time jobs or part-time consultancies—they have become supply teachers, for example—and are on much lower incomes than they were on when they were here. Those Members are not able to top up their pension fund to keep it at the level that they would have enjoyed had they remained Members. It is those Members whom I am particularly concerned about. They will and do suffer severe hardship.
I would like to make some progress because many other hon. Members want to speak and we do not have a long time. If the hon. Lady will allow, I shall continue.
It is those Members whom I am concerned about. It is that interrupted service that is not recognised in any way by the present arrangements.
Of course, one accepts that that is true, but we are comparing the parliamentary career with the situation of people outside. If someone in employment as an accountant or a lawyer—a large proportion of Members are lawyers—[Hon. Members: "Too many."] Still, if an accountant or lawyer loses his job, he can get employment again.
No, I will not give way again to the hon. Lady. I am already regretting having done so in the first place.
The Leader of the House said that we must look at the impact of the proposal on other public sector employment and at its costs. Almost uniquely in the public sector, our pension scheme is a funded scheme. Almost all other public sector pensions are unfunded. They operate on a pay-as-you-go basis. The Government do not provide a fund of money in order to pay them. They pay them out of current taxation.
Dr. Tonge may not remember it, but at one time, hon. Members were paying 9 per cent. of their salary towards their pensions. As a result of that and of the prudent management of funds by the trustees, the pension scheme is and has been in substantial surplus for some years. The consequence has been that the Government contribution has been well below that recommended by the Government Actuary over many years.
The Government Actuary recommends how much should be paid if the scheme were unfunded. He deducts from that what Members are contributing and then arrives at the figure that the Government would need to pay. I will quote the amounts that the Government have saved over the past few years. In 1990, the Government paid 6.6 per cent. less than the Government Actuary recommended; in 1992, 10.2 per cent. less than recommended; in 1995, 9.9 per cent. less; in 1996, 7.9 per cent. less; in 1999, 8.1 per cent. less; and in 2001, 11 per cent. less than recommended. The proposal would mean a 6 per cent. increase in cost—about £28 million. Even if the Government were to accept that, because of the scheme surplus they would still pay significantly less than the Government Actuary recommends they should, so we do not need crocodile tears from the Treasury telling us that the proposal cannot be afforded.
The House voted on the matter in 1980 and recommended that we should increase the accrual rate to one fortieth, which is what the trustees recommend at the moment. Unfortunately, that was not implemented, but it represents the very least that is being obtained in comparable countries.
Will the hon. Gentleman let me continue for a just a bit longer?
We are probably the meanest democracy in the western world in the way that we treat our Members of Parliament in terms of pensions. I will demonstrate that with facts and figures, but first I shall give some other public sector comparisons. Only one other public sector involves the principle of interrupted service: when the legal profession moves into the judiciary, sometimes temporarily. The judges' scheme is complicated. They used to receive a full pension after 15 or 20 years, depending on the rank of judge they were, but they are now on an accrual rate of one fortieth, which is what we are asking for.
The police have a complicated accrual rate. The rate is one sixtieth for the first 20 years and two sixtieths for each year thereafter, up to a maximum of forty sixtieths, which means that they receive, effectively, an accrual rate of one fortieth. They achieve a maximum pension of two thirds after 30 years of service. Of course, their retirement age is very much lower than ours. We retire at 65, although it is possible to retire at 60 if one is willing to take a substantially reduced pension. In the police service, however, the pension is payable from the age of 50. Normal retirement age in the police is 55, and 60 for inspectors and superintendents, except in the Metropolitan police, for whom it is 55.
Similarly, in the armed forces, to which reference has been made, the scheme grants a full pension after 34 years' service. That is similar to our scheme, but the armed forces' retirement age is 55 and they can retire after 16 years' reckonable service. Unlike our scheme, theirs is non-contributory.
I draw the hon. Gentleman's attention to the comparison made by the trustees in their evidence. They regarded the range and diversity of a Member of Parliament's job as comparable to that of directors and senior executives in the private sector. Having left such a role to come to this place, I have no pension from that period of service that is comparable to what he is proposing. Moreover, I fail to see any justifiable comparison with the responsibilities.
All I can say is that the review body thought that MPs were comparable with senior management and junior directors. The hon. Gentleman might have forgotten that it was making a comparison with the ordinary duties of a Back Bencher, and perhaps overlooked the fact that Members undertake considerable additional and onerous unpaid appointments, whether as Parliamentary Private Secretaries, members or Chairmen of Select Committees, members of the Chairmen's Panel, or Opposition Front-Bench spokesmen. A large number of the appointments that the majority of Members undertake substantially increase their work load. So the hon. Gentleman's comparison is not terribly accurate.
I want to make a comparison with what happens in other Parliaments. In Australia, pensions are payable after 12 years or four parliamentary terms in the case of voluntary retirement, and after eight years or three parliamentary terms in the case of involuntary retirement. The scheme provides for a maximum pension of 75 per cent. of basic salary after only 18 years.
In Denmark, pensions are linked to civil service grade No. 49, and are payable in full after 20 years' membership of the Danish House.
In Finland, the full pension is payable after 15 years as an MP. Those born before 1940 get 66 per cent. of MPs' pay from the age of 60. Those born after 1940 are eligible for 60 per cent. at 65. However, Members who are defeated receive what is called an "adjustment pension" for the rest of their lives, at the current rate of 1,250 ecu a month. When an MP dies, his spouse and children receive his full pension.
In France, Members can accrue a maximum pension of 84.375 per cent. of final salary after twenty-two and a half years. In Germany, the maximum pension is 75 per cent. of final salary after seventeen and a half years.
In the Republic of Ireland, the accrual rate is one fortieth and Members receive two thirds of their pay after twenty-six and two thirds years. That is in line with our suggestion, and is one of the less generous overseas schemes.
In the Isle of Man, the accrual rate is one fortieth, but the maximum pension payable after 30 years' service is 75 per cent. of final salary. In the United States of America, the maximum pension is 80 per cent. of final salary, with an accrual rate of one fortieth.
The combined resources of the Fees Office and the House of Commons Library have not enabled me to find a single other western country that pays such a mean rate of pension as we do, and it is about time we put that right.
I have a feeling that my contribution to today's proceedings may prove a mite less popular with my colleagues than my speech yesterday. Indeed, colleagues whose judgment I respect have advised me that it is not a wise career move for someone like me—young, ambitious, upwardly mobile—to table such amendments. Well, that is something I shall just have to live with. I came to this place to do what I believe to be right, not to bask in the warm glow of colleagues' approbation, pleasant though that is. Whatever view they take, I hope that hon. Members will at least accept the spirit in which I speak.
I should say at the outset that I am strongly in favour of the motion on Members' allowances, which will place the employment of our staff on a proper footing. That is long overdue, and I congratulate those responsible, particularly my hon. Friends the Members for Dundee, West (Mr. Ross), and for Ealing, Acton and Shepherd's Bush (Mr. Soley), who played a leading part in achieving the reform.
I turn to the amendment that is in my name and those of several other hon. Members. I do not believe that there is any justification for awarding ourselves an extra £4,000 over the next two years, and my amendment would rescind that. Nor should we be in the invidious position of having to vote on our own pay, and my amendment would put an end to that embarrassment once and for all. It would do so by linking our fortunes not to those of some anonymous civil servant, as we have attempted to do in the past, but to a cross-section of public servants—nurses, teachers, doctors and dentists—with whom our constituents can readily identify.
If the amendment is accepted, our pay will rise each year by the average of the increase received by those professions. The figure for last year would have been about 3.7 per cent., and for the previous year about 3.3 per cent. That is not very different from the increases that we received. We would not, however, receive the extra £4,000.
There is a view that certain so-called top people should be immune from the laws of the market—in which, in all other respects, they usually believe strongly—that apply to ordinary mortals. I do not share that view. So far as possible, elected representatives should share the same sunshine and rainfall as those whom they represent. I do not accept that £49,000 a year is an inadequate salary. We are in the top 10 per cent. of income earners. We earn more than the overwhelming majority of our constituents, although I appreciate that that is less true of those who represent the more prosperous areas. However, the fact remains that £49,000 a year is a good salary, even in the most prosperous areas. I agree with the comments of my right hon. Friend the Leader of the House in opening the debate: we should not undervalue our work, and our present salary does not do so.
It might be possible to justify an increase this time if we could argue that ours is a profession that finds it difficult to attract candidates of the right calibre, or if seats were left unfilled owing to a lack of applications. The truth, however, is that all parties are heavily oversubscribed with applicants for winnable seats. Perhaps it has escaped my attention, but I have not noticed any unfilled vacancies. Unlike nurses, teachers and doctors, there is no shortage of people wanting to become Members of Parliament.
It is a tribute to the fact that the public service ethic is not entirely dead, and to the undoubted attractions of the job, that there are individuals who are prepared to give up highly paid jobs in business or the professions to seek election to Parliament. As long as that remains the case, there is no justification for a large salary increase.
We are not debating ministerial salaries. Should the hon. Gentleman's talents come to the attention of the Prime Minister and in due course he becomes a Minister, I assure him that I, for one, will not resent whatever salary happens to be paid for that job.
It cannot have escaped our attention that Members' standing in the esteem of the public is not all that high at present. No doubt there are a variety of reasons for that, many of them unfair, but we are not in such a strong position that we can afford to take even a little gamble with public opinion. I know that there is a view that this is a small storm and it will all blow over in a few days, but I do not agree: every time we do something like this, it adds to the great ocean of cynicism lapping at the foundations of the democratic process. Nor will it be forgotten as quickly as some Members think. Even now, after five years, people still raise with me the last outrageous salary increase that we voted ourselves, in July 1996.
Over the past four weeks, I have participated in various discussions about the urgent need to restore respect for politicians and the political process. I am not clear how awarding ourselves a large increase in salary will help to achieve that. I look forward to hearing from anyone who thinks that it will.
There is a strong case for awarding nurses and others in this category a large increase. Suppose that my hon. Friend's amendment were accepted and that those people then got the pay increase they deserved. Would it not increase people's cynicism, and would they not say, "Ah, they only got the extra money because MPs' salaries are now linked to theirs."
I have to accept that some people are capable of finding cynical motives anywhere, but linking our salaries to professions with which our constituents could readily identify would be easier to defend than the present situation.
Of course there continue to be many people who are prepared to give up high salaries to come here for a lower one. The question is whether there are as many as there used to be. If we are to believe the media, the quality of people coming here is getting poorer and poorer. If they are right, that may be a reason.
I do not want to get involved in discussing the quality of my colleagues, other than to say that, in 14 years in this place, I have found people of an amazing range of talents and abilities. I have already done enough to hone down my vote in any internal party elections without commenting further.
If this is such a good idea, why did we not vote on it before the general election? The report has been around for some time and could easily have been dealt with before
In both constituencies that I have represented here, I have become well known, if not notorious, for believing that our remuneration package needs to be improved, so I hope that Mr. Mullin will not complain if I do not follow down his path.
My points are based on my experience of having to think flexibly and laterally about how to manage on the limited resources provided by the office costs allowance. I acknowledge that the total has increased, but we need to build in much more flexibility than is found in either the report or the Government's recommendations. I was glad that Mr. Tyler recognised that.
The report seemed to be pervaded by the belief that we are all dreadful employers. There have been conflicting comments about how good or bad we are, but if we are to enhance our abilities, it would be better for us to get training on how to be a good employer rather than to inflict inflexible regimes on everybody, regardless of their qualities as an employer. If we had such training, we might be able to use our resources more flexibly.
In employing my staff, I have found that the draft, and very brief, job description, as outlined in the report, and the salary allied to it, do not fit with what I expect to need. We are all being dragooned into going down a route that may not be the most effective way of delivering services to our constituents and to the House. I would like the Leader of the House to clarify whether there is flexibility in our discussions with the Fees Office about both the contract and the pay that goes with it.
The Leader of the House referred to the use of consultants. In order to provide the best possible service with the limited sum available, I have used consultants in various areas, and not only in research. The right hon. Gentleman said that he believed that such a practice should be allowed to continue. Does he believe that we should be able to continue to use consultants within our staff budget from
I know that there are various views on how information technology needs would best be provided. I use IT extensively, although anyone who knows me is aware that I am not a specialist in it. I already use three desktops and two laptops, across two staff, so the recommended package does not even meet my current needs. I have two combined fax, copiers, scanners and printers, plus one very robust printer for the vast volume of letters that my secretary has to print off. That, again, is not covered.
I understand that it has been mooted that we should be able to buy the extra equipment that we need through our discretionary allowance, but given the speed of technological change, upgrading every four years is not good enough. I am concerned that, because of the IT budget, our IT will go the way of our internal telephone system, which it took 20 years to upgrade. I fear that we will not only not upgrade as often as we should but find ourselves sliding back into using the equivalent of the old manual typewriters.
In order to keep my equipment going, I have my own computer consultants who provide me not only with training but with instant back-up, whenever I need it, including weekends and evenings. I am a great believer in avoiding having a monopoly provider. I hope that, out of our increased expenses, we will be allowed to keep our own computer support staff.
If the Leader of the House can give me assurances on all those points, I will be most grateful. If not, I will want to take the necessary action.
I rise to speak to amendment (e) on the additional costs allowance. I thank those hon. Members who have supported my proposal. I should add that I will be supporting the amendments tabled by my hon. Friend Mr. Soley, and the amendment tabled collectively and unanimously by our pension trustees, who belong to parties on both sides of the House.
We all wish that the question of additional costs had been referred to the SSRB when the other allowances were, but it was not. That is unique. The SSRB last looked at these matters in 1996, when the overnight allowances for Members of the House of Lords and the additional costs allowance for hon. Members were considered at the same time.
It may be contended that the two allowances are not exactly comparable, and that is true. One is an overnight allowance, and the other is a yearly allowance. However, the SSRB concluded that they existed for the same purposes, and made a direct comparison between those allowances and allowances elsewhere in the public and private sectors.
That comparison can be found on page 93 of the 1996 report, which was report No. 38. The SSRB concluded that the two allowances were roughly similar, as the overnight allowance for Members of the House of Lords was £74 per night, and the additional costs allowance for hon. Members, when divided by that Session's 159 sitting days, came to £76.86 per night.
The figures for the most recent year go up to March 2001, and show that the House of Lords allowance was £84 per night. I had an exchange earlier on this matter with my right hon. Friend the Leader of the House, and the information that I have obtained from the House of Commons Library is that there were 159 sitting days last year. Dividing hon. Members' additional costs allowance of £13,322 by that figure puts our nightly rate at £83.79. The two figures are therefore very similar indeed.
The two allowances have the same purpose, as the SSRB has decided in the past. It has also decided that they should be calculated on essentially the same basis. I therefore conclude that the same percentage increase—of 42 per cent.—should apply.
In fact, the House of Lords has done a little better than that. The SSRB said that, in future, Members of the House of Lords can claim for the nights on which they sit and for the Sunday night before a sitting week. In the coming Session, therefore, it is recommended that, if the Lords sits for four days, the maximum allowance for that week will rise not by 42 per cent. but by 78 per cent.
Before my right hon. Friend has a slight heart attack at that, I assure him that I shall not press an increase of 78 per cent. However, there is strong evidence that the percentage increase should be the same for both allowances, as historically they have been calculated on the same basis. The current report is No. 48, and paragraph 4.4 of section IV of part 3 of volume 2 states that
"there is no doubt that the cost of accommodation in central London has in recent years risen faster than the overnight allowance. So have rents and the price of properties. In the past, the SSRB has assumed that accommodation in a 3-star hotel would be a broadly appropriate benchmark for both MPs and peers."
It adds that, on that basis, a House of Lords overnight allowance
"of at least £110 and preferably £120 now seems appropriate. This seems a reasonable estimate."
The SSRB accepts that both hon. Members' additional costs allowance and peers' overnight allowance have been calculated in the past on the basis of the cost of a three-star hotel. It concludes that a 42 per cent. increase in the House of Lords allowance—from £84 to £120—is right.
Hon. Members may consider that using the cost of a three-star hotel as the basis for calculation might have been appropriate in the past but that a better indication of how our allowance is spent should now be the change in rents or property prices over the years. If, over the past few years, those increases had been substantially lower than increases in the cost of three-star hotels, I might concede that my amendment was too generous. Figures from the Library show that the average rent in the fourth quarter of last year for a one-bedroom flat in inner London was £275 a week. By itself, that would come to more than the current allowance.
The increase in central-London rent levels from the fourth quarter of 1995 to the fourth quarter of 2000 amounts to 39.36 per cent. That is a period of five years, and the rise is only fractionally lower than the proposed 42 per cent. rise in the House of Lords overnight allowance, which is based on a seven-year period. In general, London property prices rose by 130 per cent. between 1994 and 2001, and prices for flats rose by 152 per cent.
Even if the SSRB were to abandon the three-star hotel basis for calculation of these allowances, and move to a calculation based on rents or property prices, there is no evidence that what they would find would force them to conclude that a rise of 42 per cent. was over-generous, given the increase in costs over the past few years.
We must get away from the idea that any increase in the maximum figure is necessarily applicable to everyone. Mr. Tyler made a telling point when he said that we are talking about allowances. The maximum figure is the limit up to which a claim can be made, not an automatic payment made to everyone.
Some hon. Members may not claim the maximum figure for the current additional costs allowance, and they would not be affected. Others may claim up to the maximum and have no further expense, and they will not be affected either. However, I already know that some hon. Members spend more on these costs than they can claim. Some hon. Members will find that their rents will go up so much in the next few years, given the current rising trend, that they will go beyond the amount contained in the proposal. Certainly, some new Members of Parliament will find that property prices have doubled in the past few years. They will face a difficult problem if we do not resolve this matter.
My right hon. Friend the Leader of the House made a very interesting offer earlier when he said that we could always refer this matter to the SSRB now. As I said then, I should have been much happier had the additional costs allowance been so referred a few months ago, along with all the other allowances.
I could have plucked a figure out of thin air for the amount by which hon. Members' additional costs should be increased, referred that number to the SSRB and delayed matters for a while. However, I think that I have been able to show that the amendment is based on what the SSRB has done in the past. Its direct comparisons have caused it to determine that peers' overnight allowance and hon. Members' additional costs allowance existed for the same purpose. In its most recent report, the SSRB states that, traditionally, it has used the same basis to calculate both allowances. My conclusion, therefore, is that it is fair to say that the same percentage increase should apply to both now.
My right hon. Friend might suggest that, if the matter were to be referred back to the SSRB, that body might find a different comparator based on rents or property prices. I think that I have drawn a fair and reasonable comparison between the allowances that I have described.
Delay in implementation of the proposal in the amendment could cause considerable problems for many hon. Members. Traditionally, new hon. Members go looking for property to rent or buy in the summer period, when returning hon. Members consider their accommodation arrangements for the next five years. It would place an unfair burden on hon. Members to tell them that nothing can be done over the summer, that the proposal has had to be referred to the SSRB and will not come back until the autumn, and that Christmas is the earliest date by which we might know what the increase is to be.
It would be unfair to delay, especially as I think that I have shown that the comparison proposed in the amendment is one that the SSRB has made in the past. My amendment is based on the information that that body has used to calculate the overnight allowance for Members of the House of Lords.
I rise to speak briefly to amendment (b) on parliamentary pensions, which is tabled in my name and the names of many other hon. Members from all parties. I am grateful to those who have signed it and to those who have indicated that they would have signed it if they had had more time.
I stress that I have no particular vested interest in the proposal. The records show that I am the marrying kind, and that as a result no one with whom I am connected would benefit from the change.
Recommendation 8 of the report states that trustees should canvass the views of members of the parliamentary contributory pension fund on the issue of survivors pensions for unmarried partners, but what will happen after views have been canvassed? The motion merely calls on trustees to consider recommendation 8, together with recommendations 4 and 6. It does not speak about how best to implement the recommendation, as it does with recommendation 2. Opinion in this House would invite the trustees to go further and to act. That is why I thought it appropriate to give the House an opportunity, through a Division or by general assent, to give a view on the matter.
This proposal relates to the domestic arrangements of hon. Members in this day and age and is a reflection of current society. Also, we should be cautious not to penalise those who are bereaved, those who are the partners of a member who has died but do not happen to be married to them. By passing the amendment, we will indicate our wish to see our own practice reflect best practice in the private sector and the aspirations of those in the public sector.
There is a long-term TUC campaign that the House of Commons Library note describes as a pension provision for unmarried partners. A document, "Pensions and prejudice—how public sector pension schemes discriminate against non-married partners", argues for the introduction of benefits for non-married adult survivors in public sector pensions schemes. For those who feel it important to see that the Government do not oppose such proposals, it should be noted that the Government's own Green Paper—called, interestingly, "Partnerships in pensions"—states that the Government would be prepared to consider how practical arrangements can be devised for achieving the extension of eligibility for survivors' pensions to unmarried partners in the context of a statutory scheme.
The Government, in their evidence, indicated that they are prepared to consider extending eligibility for survivors' pensions to unmarried partners of members of statutory schemes, provided that the members are prepared to meet the additional costs. I believe that we should indicate that we are prepared to meet those small additional costs.
This proposal will not benefit the majority of Members; I accept that. This will be, in effect, an altruistic act by many current contributors to a minority, but a minority that exists in all parties and whose domestic arrangements, which reflect a significant proportion of current society, are not those of living with a married partner. It would not come at a cost to the Exchequer and it would satisfy those who worship private sector practice—as, now, probably a majority of private sector schemes have such a measure—and those who seek common cause with public sector workers.
In conclusion, the key question is the existence of a committed relationship and the financial dependence and/or interdependence of that partner; the key factor is not the presence or absence of a marriage certificate or the sexuality of the bereaved person. We have an opportunity to indicate that we want to go down a non-discriminatory path, which is in keeping with best practice in the private and public sectors in this day and age. I warmly commend amendment (b) to motion No. 4 to the House.
We have had a very good debate and I am glad that the time allowed for the debate has permitted all those with selected amendments to speak to them.
I hope hon. Members will forgive me if I am unable to respond to all the questions that were put to me in the time available. However, I shall endeavour to respond in writing to all Members who put questions to me. I shall try to respond to some of the questions from Mrs. Browning, who asked one or two questions of detail.
First—I appreciate that this is important in terms of how Members may approach the amendments tabled by my hon. Friend Mr. Soley—the hon. Lady asked about the rates of pay and the job descriptions. It would be our understanding that the Department of Finance and Administration would implement, broadly speaking, the rates of pay as set out in appendix E. We would envisage that being done within the range of a band of, perhaps, £2,000 above to £2,000 below the median point set out in appendix E, so there would be some flexibility for Members to nominate the particular figure for a member of staff.
The hon. Member for Tiverton and Honiton asked also about insurance. I reassure her that employer's liability and personal accident will continue to be centrally covered. Of course local matters, such as insurance cover for the structure and contents of a constituency office, will be for Members to find out of the incidental expenses provision, which, again, is a matter to bear in mind when considering the amendments tabled by my hon. Friend the Member for Ealing, Acton and Shepherd's Bush.
I say to the hon. Member for Tiverton and Honiton, and others who took part in the debate, that I very much welcome the support that has been shown for the Speaker's advisory panel and the recognition that that will provide us with a degree of flexibility to look at some of the difficult questions that arise in the process of transition. I welcome also the maturity shown in the debate and the recognition that there are bound to be teething problems. Inevitably, there will be difficult cases and it is right that, through the advisory panel, we should have the mechanism to consider these and, through the Speaker, the ability to assist in putting them right and providing a remedy.
In terms of the first two amendments tabled by Mrs. Lait, on consultancies, I say that, in the event that she does not press them, I will undertake that they are considered early within the advisory panel to consider what remedy is available to us. Her amendments, and the others before the House, are House matters.
That is absolutely understood and I will be brief. What about the contracts that we already have with consultants? If we move immediately to the new pay scale, will we have to break those contracts?
There is specific provision in the SSRB report for central assistance to Members who find that they have legally binding contractual commitments, be it with an IT provider, a member of staff or a consultancy. Those individual cases will be considered to see if we can find a way forward.
The amendments are, of course, for the House to decide. On a number of them, I offer no view to the House. However, there are some on which I would invite the House to reflect before supporting them. I must say to the hon. Member for Beckenham that that applies very strongly to her amendment (l) on the IT package. It would be impractical for us to enter into the individual commitments that she wants. If we are to have a centrally funded and managed procurement system, we cannot at the same time, in practical terms, provide that degree of individual response. I hope that she will not press that amendment.
On the amendment from my hon. Friend the Member for Ealing, Acton and Shepherd's Bush, we take no view. It is for the House to decide and for Members to judge in the light of their experience.
I have already told my hon. Friend Mr. Betts that I am willing to put the additional cost to the SSRB and to invite them to respond urgently. I am pleased that he regards that as a tempting offer; I hope that I can tempt him further. [Laughter.] I hope that I can prove more tempting to my hon. Friend than the hon. Member for Tiverton and Honiton. If he does push his amendment, we will have to explain and justify to the public a 42 per cent. increase that does not proceed from any independent assessment. Personally, I would feel much more comfortable if we first went through such a process.
I invite other Members to join me in resisting the amendment tabled by my hon. Friend Mr. Mullin. As I understood his speech, he believes that we are paid too much and should be paid less. The effect of the amendment, of course, would be to pay us more. This is what, in an earlier phase of his career, he would have described as an inherent contradiction in the system. I would strongly suggest that he not press his amendment; otherwise we may be obliged to advise the electors of Sunderland, South that he believes that Members of Parliament should be paid more.
Mr. Butterfill spoke with authority as a trustee, and I fully respect that, but the SSRB considered and rejected the course of action that he proposed, and the Government have grave concerns about the impact on public spending if the proposal were to become a bargaining point across the public sector.
Finally, we should not lose sight of the fact that the overall package is a dramatic change for the better. It involves higher ceilings for our staff costs, it involves better pay for the great majority of Members' staff and it gives a sound basis for access to modern technology. Whatever view hon. Members may form on the amendments, I very much hope that they will support the proposals, so that we can bring the support services of the House into the 21st century and enable us to serve our constituents better.
It being Four o'clock, Mr. Speaker pursuant to Order [this day], put the Questions necessary to dispose of the business to be concluded at that hour.
Amendments made: (o) to the motion on members' allowances, insurance &c, in paragraph (2)(c), leave out from 'above' to 'these' and insert:
'should not in any financial year exceed—
(i) £70,000 in the case of a Member representing a London constituency; and
(ii) £60,000 in the case of any other Member, plus £3,500 in respect of each full-time (or full-time equivalent) staff person employed by that Member whose duties are wholly or mainly required to be performed within Greater London, provided that the aggregate sum payable in respect of any Member shall not exceed £70,000.'.
(d) in paragraph (2)(d), leave out '£14,000' and insert '£18,000'.—[Mr. Soley.]
Amendment proposed: (l), at end of paragraph (f), insert—
'(h) that Members should be consulted on their IT needs and requirements before any contracts are let centrally; that the central purchase of any IT equipment should be subject to public procurement requirements; that a wide range of provision is offered and updated as required by each Member and that Members should have access to more than one IT support service of their own choosing.'.—[Mrs. Lait.]
Question, That the amendment be made, put and negatived.
Amendment proposed: (e) in paragraph (2), at end insert—
'(2A) The House of Commons Additional Costs Allowance should be increased by the same proportion as that proposed for the House of Lords Overnight Allowance under Recommendation 16 of the Review Body on Senior Salaries Report No. 48.'.—[Mr. Betts.]