My Lords, in moving the amendment, I shall make some comments about exchanges in your Lordships' House on
A review after two years would reveal that information earlier. That would be of assistance certainly to the Royal British Legion, to the Government and, more importantly, to those servicemen and women on whom we rely for our security and whose health is damaged or further impaired by their service. I hope that the Minister will be able respond sympathetically to my suggestion.
I shall raise briefly a matter of concern to me as a parliamentarian of 30 years' standing. It relates to a debate about an amendment tabled on Report to Clause 1 on
"The Ministry of Defence rejects the arguments put forward by the Royal British Legion on the back of its analysis that 60 per cent of claimants who would have succeeded under the present rules are likely to fail under the new ones".
I then recalled seeing correspondence that disputed a government claim to have joined with the Royal British Legion to investigate the methodology used in their analysis, without their having done so. My noble friend replied that that had not been done,
"because the Royal British Legion cancelled the meeting at which it was due to be discussed. Since then, it has said in a letter that it has no intention of doing so. That is the reason it has not been done".—[Hansard, 8/9/04; col. 578.]
Those words had the effect of misleading the House—I am sure not deliberately—or were said because of a misunderstanding.
My noble friend's interruption of my speech related to the aftermath of a meeting between officials of his department and the Royal British Legion on
The ministry's reply was that evidence could be provided to support this claim, but, in fact, none was provided. Nor was there any explanation of how the figure of £200 million had been arrived at. The only undertaking given was that the Ministry of Defence would,
"look at the burden of proof wording again", and then write to let the Royal British Legion know the outcome.
Eight days later, on
"consider fully any proposals that you wish to make".
Meanwhile, my noble friend the Minister had written to the noble and gallant Lord, Lord Bramall, on
"I am not convinced that a detailed review of the cases"— by which he meant the cases received by the Veterans' Agency each year—
"would help to clarify the issue".
Anyone reading that letter would see that the Minister saw no useful purpose in looking at an analysis of individual cases.
The Minister wrote to my noble friend Lord Morris of Manchester on
Unsurprisingly, the Royal British Legion concluded that there must be some doubt about my noble friend's new desire to inspect its analysis because he had previously told the noble and gallant Lord, Lord Bramall, that there was no purpose in doing that. The legion therefore considered that it was prudent to await the letter which the MoD had promised it would write to the legion following the meeting on
There had been no reply so on
"the Bill returns to the House of Lords on
"look at the burden of proof wording again" and write to the legion, a letter from Lieutenant-General AMD Palmer of the MoD to Brigadier Ian Townsend, the legion's secretary-general, was received at the legion. The letter enclosed what it described as,
"a new form of words" which repeated that the MoD stood by the terms of the Bill and set out its understanding of the legal meaning of the balance of probabilities and the obligations of the Ministry of Defence. This, the legion's adviser described, as having left,
"the MoD's position completely unchanged".
When Lieutenant-General Palmer's letter arrived on
The response was that the restatement of the MoD's position had left its position completely unchanged and, since the MoD had previously said that it saw little purpose in considering the legion's statistical analysis, its change to requesting access to the Royal British Legion's statistics was unacceptable. Noting also Lieutenant-General Palmer's statement that the MoD had little scope to change and that it was within two days of the debate on the burden of proof in your Lordships' House, Brigadier Townsend said that matters would now have to take their course in Parliament.
Against that background, to imply that the legion was being unco-operative, as my noble friend did on
I understand that the legion will be responding in detail to my noble friend's allegations on Report and I am sure that it will do so with all its customary integrity as one of the country's most highly regarded institutions. I beg to move.
My Lords, I do not wish to get involved in whether the Minister misled the noble Lord, but I would like to support the purpose behind the amendment which has just been moved. It seems to me that this is a highly controversial piece of legislation on the compensation scheme and that an early report on it therefore would be worth while in less than the five years envisaged.
As we have noted during the passage of the Bill, this is a framework Bill and a great deal of the detail depends on the good will not just of the present ministerial team, which I do not doubt, but of future ministerial teams and future governments. Many of us have been seeking ways to buttress the position and to ensure that best practice in the private sector is read across into the public sector scheme. We have talked about the need for trustees and the possibility of statutory compliance with the new Pensions Regulator's codes, where appropriate. The Government, despite plenty of fine words, have not been prepared to put anything specific into statute. I have been particularly keen to make it a statutory requirement to comply with the Pensions Regulator's code. It was interesting in that rejecting it earlier the noble Baroness, Lady Crawley, referred me to Mr Alan Pickering as an important source on the matter. I refer to an article which appeared in the Financial Times on Monday in which Mr Pickering said that the trustees are,
"unsung heroes. It is the job of the trustee to hold [these] worthy professionals to account".
He urged that,
"salt-of-the-earth folk" should not be deterred "from becoming trustees".
I believe that there is an awful lot here that we are allowing to slide by. The noble Lord's amendment puts a brick in the wall, which I believe is well worth having in the sense that we shall have an early review of what is a highly contentious proposal which the Government are proposing to implement. I therefore support what he has in mind.
My Lords, I entirely understand the concern that underlies my noble friend's amendment. He has made a strong case for it and I am sure noble Lords across the House will see its importance. It was in the context of his case for the amendment that my noble friend referred back to the debate on Report on the burden and the standard of proof and referred to me in doing so.
I can assure him that the Royal British Legion will be responding, point by point and in full detail, to charges made by my noble friend Lord Bach in his reply to the debate on my amendment to the Bill—so emphatically carried by noble Lords of all parties and groups in this House—to retain the safeguard vouchsafed for service men and women left in broken health, and the bereaved families of those who give their lives in our service, by a burden of proof based on reasonable doubt.
Meanwhile the legion totally repudiates and deeply resents any suggestion, implied or explicit, that I in any way misreported or misrepresented its position on an issue to which the whole ex-service community attaches the highest importance.
For now, the legion notes that the Government's stance on the burden and standard of proof is exactly as it was when this Bill was first presented to Parliament, notwithstanding all that has been said by the ex-service community.
Confirmation of this was elicited by a brilliantly well-timed question from my friend the noble and learned Lord, Lord Ackner, at the end of the Parliamentary Under-Secretary's reply to the debate on my amendment. The noble and learned Lord, Lord Ackner, asked,
"before the noble Lord sits down, could he explain on whom the onus of proof lies in his proposals? I am not concerned with the standard. The claimant brings a claim: is the onus of proof on him to establish the situation or is it on the MoD?", to which my noble friend Lord Bach replied,
"under the new scheme the onus would be on the claimant but obviously on the balance of probabilities".—[Hansard, 8/9/04; col. 588.]
They were his final words in the debate, making it utterly clear that the MoD's stance had remained throughout exactly as it was at the outset, showing them to have been totally impervious to all suggestions for change whether from the legion, the Defence Committee of the House of Commons or anyone else. What has changed is the Bill itself and the legion is most grateful, as it has publicly stated, to everyone here who helped to bring that about on
My Lords, the noble Lord, Lord Corbett, raises an important point. The Royal British Legion deserves better treatment from the Government. Ministers cannot say how they depend on NGOs and then insult them when they do their job. The Royal British Legion has always made it clear that it is prepared to compromise. I very much hope that a compromise can be reached for the satisfaction of the Royal British Legion, the ex-service community and the Government.
My Lords, I thank all the noble Lords who have spoken in this short debate. I thank the noble Lord, Lord Corbett, for his amendment, but I am somewhat surprised that an attack on me, on the basis of misleading the House, which he has made in his usual robust and fair way, is one he gave me no notice of at all.
My Lords, I had no idea that the noble Lord had done that, and I am grateful to him for doing so. That is what I would have expected him to do. I have not been in my office since five to twelve, as I was busy doing other defence work elsewhere in London. I am grateful to him for having done that.
On his amendment, we entirely recognise that Parliament will wish to be kept informed about the operation of both the new pension and compensation arrangements once they have been introduced. My honourable friend the Minister for Veterans Affairs, Mr Ivor Caplin, has a responsibility to keep Parliament informed on all matters affecting the veterans' community, including progress with the new pensions and compensation arrangements. He does this on an annual basis. It is our view that his keeping Parliament informed as he does, including on the new compensation and pension arrangements, meets the requirement expressed in this amendment, but at a greater frequency than is asked for in this amendment. We therefore do not think that there is any necessity for this amendment to be placed on the face of the Bill. But, as far as concerns the principle, of Parliament being informed about how a new scheme will work, I could not agree with my noble friend more strongly.
I do not intend, if the House will forgive me, to go into details of the debate we had last week—that matter may come back before the House in due course—but I want to make a couple of points. First, two issues have been brought together in the argument. The first is the question of the burden and standard of proof, on which there was a disagreement between the Royal British Legion and the British Government. Although attempts were made—I believe genuinely on both sides—to find a form of words at certain stages, that has not been successful up to now.
The second is the issue of the research into the 60 per cent figure that the Royal British Legion used for the proportion of claims that would fail under the new scheme. It was in regard to that latter point that I was interrupting my noble friend this time last week. I was doing so on the basis of the letter that he has quoted to me today, dated
"With regard to the issue of your officials reviewing our files relating to our earlier research in this subject, Terry English, having consulted with our legal advisers, informed Jonathon Iremonger earlier that in view of the MoD's stance that they have not nor are they prepared to carry out their own research, it would be inappropriate".
That is why no discussions took place on the 60 per cent.
I have gone into one detail, although I promised the House that I would not. I am certainly not intending to go into any more, because I think the House has other matters to attend to, both in this Bill and others.
I am, of course, deeply sorry if my noble friend Lord Corbett thinks that I have misled the House. I will look into what he has to say about that with extreme care, of course. I do not believe I have misled the House, and we will have to see what happens.
I am delighted that my noble friend Lord Morris of Manchester is in his place today. I want to make it absolutely clear to him that anything I said last week was not at all meant as a personal attack on him. He knows that I hold him in the highest affection. The work that he does for the Royal British Legion, and for veterans generally, is of the highest order. My criticism last week was of what was said on behalf of the Royal British Legion. Whether I was right or wrong to say that is another matter, but no personal attack on my noble friend was intended.
I end my brief remarks by saying that although, of course, there are disagreements from time to time between the Ministry of Defence and the Royal British Legion, and on a number of important issues raised by this significant Bill, I want to put on record the very high esteem in which we at the Ministry of Defence hold the Royal British Legion. It has a long and distinguished record of representing the interests of our veterans, and we have worked, and continue to work, with it to bring a number of very significant improvements to the veterans' community. This will continue in the future, as we build on the relationship, to take forward the veterans' initiative. We recognise the respect—mentioned by my noble friend—with which the Royal British Legion is viewed across the country and, indeed, well outside the shores of this country. We welcome and support the efforts that it makes to represent the interests of many who have suffered as a result of the service they have given to this country. Though we do take a different view on some issues—and that should not be of any surprise to the House—the Royal British Legion, in our opinion, has an essential role to play and will remain central to our relationship with the veterans' community.
My Lords, I thank those of your Lordships who have taken part in this short debate. I am grateful for the general support which the amendment has received. I thank my noble friend the Minister for his last few words. I am reading into them that, like me, my noble friend Lord Morris of Manchester and others, he recognises that it is in no one's interests that there should be a public row—more than a disagreement, a public row—between the responsible Minister and the Royal British Legion. Perhaps, in that sense, we can regard this as an unhappy incident on a long road.
I say to my noble friend the Minister that I had spoken to his private office just before noon today. I was told that he was not leaving the building until, I think, about a quarter past twelve and that he was then going to do something else but would be back. I was given a fax number, to which I faxed the notes on which my remarks were based. I am grateful to him for accepting my word on this. I want to underline that I do not believe in laying elephant traps. Where I am going to make serious accusations—rarely, happily—where it is possible that Ministers have been responsible for misleading the House, I would never simply drop those into a Minister's lap in the course of a debate. I am grateful to him for acknowledging that. I wonder whether he would be kind enough to make some inquiries in his private office as to what may have happened to that fax and write to me to let me know the outcome of that. Meanwhile, I beg leave to withdraw the amendment.
moved Amendment No. 2:
Page 1, line 14, at end insert—
"(2A) The Secretary of State may, by regulation, make provision for extra benefits to be provided for current members of the existing scheme during the transitional period.
(2B) For the purposes of subsection (2A), the transitional period is the time between the date of the new scheme coming into force for new servicemen and women and the date on which existing servicemen and women are given the opportunity to transfer."
This amendment proposes to offer, on the face of the Bill, a guarantee for those who may be adversely affected during the transitional period. We had a thorough and potentially encouraging discussion on this matter in Committee. During the debate the Minister admitted that the transitional phase of the coming into effect of the Bill was something of a problem. Existing personnel will not be able to join the new pension scheme from its introduction on
As the noble Baroness, Lady Dean, stressed during Committee stage, the devil is always in the detail. While we are happy that the Government see the need to address the transitional problem, we have only this opportunity to get on record the details of the extra benefits that will be offered. I beg to move.
My Lords, I rise to speak in support of the amendment, which has my name on it. This is about the third time in the course of this short Bill that we have dealt with the matter. We had expected to be able to deal with the matter last week; my noble friend the Minister explained that he could not report last week but that he would be today.
Few words are needed, therefore, except to say that we need a solution to this problem—otherwise we shall have a situation with people who have been in the Armed Forces for years being in the transitional period. If something should unfortunately happen to them, they and their families would be in a worse position than the new recruits, who will be immediately recruited into the new pension scheme.
My Lords, I thank the two noble Lords who have spoken in this debate. I am grateful for their patience in waiting an extra week so that we could find a solution to what is undoubtedly a very real problem, which they raised some time ago.
I can now set out our proposed approach, which I believe should meet their concerns. There is no need to write the provision into the Bill, as our proposal will be achieved through amendments to the current scheme rules in the prerogative instruments, and does not thus require primary legislation. Although we did not discuss this matter at Report, my noble friend Lady Dean has raised this issue both at Second Reading and in Grand Committee. As she said, this is a transitional problem which calls for a transitional solution.
The problem arises because currently serving personnel will not be able to join the new pension scheme until up to two years after its introduction for new entrants on
The Ministry of Defence has been considering how to minimise the impact of this gap. I had suggested at Grand Committee that we might offer service personnel the opportunity to buy additional voluntary contributions to cover some or all of the improvement offered in the new pension scheme. Following extensive discussions with Her Majesty's Treasury, the government actuary and the three single services, we have decided to go down a different path.
We propose instead that for deaths in service during the transitional period, the dependants of currently serving personnel who are members of the existing pension scheme will be given the better of the two benefits packages from either the current or the new pension scheme. The Armed Forces Personnel Administrative Agency will calculate the respective benefits packages to decide which offers the better package of benefits in each case, but the dependant will have the right to appeal the decision through the Discretionary Awards Panel.
We plan that the War Pension Welfare Service would also have a role, visiting the bereaved widow or widower to help them to understand their entitlements under the current and new pension schemes and why one is considered to be more advantageous than the other. That would allow feedback into any appeal consideration. In this way, we will ensure that, during the transitional period when current service personnel are unable to make a choice about which scheme best meets their own personal needs, their dependants will not be disadvantaged should the worst happen.
It may be tempting to think the new pension scheme will always be the answer. I should say that, in coming up with this proposal, we concluded that it would not be right to take away entitlements under the existing scheme and replace them with the new scheme; taken individually, some of these existing entitlements, such as the short-term widow's pension or the rapid early accrual of benefits are more advantageous than under the new scheme. We could not take these away unilaterally, even though we consider that the overall package under the new scheme will in most cases be very significantly more generous.
Once the offer-to-transfer exercise has taken place and serving personnel have been allowed the opportunity to join the new pension scheme, pension benefits would be determined by the individual's decision between the two schemes, although there would still be opportunities to improve benefits by taking out an additional voluntary contribution, such as that currently available to improve death-in-service benefits.
Finally, I should make it clear that there is not a transitional issue for attributable benefits payable when a death is due to service. From
I hope that the solution that we have found here satisfies both noble Lords and the House.
My Lords, I am grateful to the noble Baroness, Lady Dean, for her support. The Minister has given a very full response to the amendment. There was a transitional problem, which the Minister has taken on board and addressed head-on. I received a nod from the noble Baroness, Lady Dean, so I assume that she is content with the Minister's proposals. In thanking the Minister, I beg leave to withdraw the amendment.
My Lords, the noble and gallant Lord, Lord Boyce, whose name is attached to this amendment, is abroad, but has asked me to say how important he considers this issue.
I shall not rehearse the arguments about the payment of pensions for life for the existing non-attributable service widows. Your Lordships by now fully appreciate that those unfortunate women will lose their pensions should they choose to remarry or cohabit. Furthermore, noble Lords will be aware that this ruling affects only those ladies and widowers who are beneficiaries under the current Armed Forces pension scheme. In future, all widows and survivors of registered unmarried partnerships, be they deemed attributable or non-attributable, will, thanks to action by this House in the past, be permitted to retain their family forces pension for life.
I also find it difficult to understand the arcane distinction between an attributable death and a non-attributable death. If a husband dies, through whatever cause, the widow will face exactly the same problems of financial responsibility and an uncertain future.
This is a highly emotive issue, which has been a subject of grave concern throughout discussions in this House and the other place. We need to give clear answers to those who feel that they are being unfairly let down.
I start by looking at the issue of read-across. We are constantly assured that the Armed Forces are "special". However, the Minister told the House at Report that:
"The Government do not believe that special treatment should be extended to circumstances where the pension relates to a death which is not due to service. In this case we could not in all fairness treat differently the widow of a service person and the widow of, say, a fireman, a policeman, a civil servant or a teacher. There is no basis for paying pensions for life in one case and not in the other".—[Hansard, 8/9/04; col. 610.]
I find the logic in this argument impossible to follow, particularly when I read Malcolm Wicks, who stated that,
"The Local Government Pension Scheme introduced widows' and widowers' pensions for life from April 1998. Since October 2002 the new Civil Service pension scheme has provided for survivor pensions to be paid to unmarried partners . . . At the same time the requirement to terminate widows' and widowers' pension on remarriage or cohabitation was removed".—[Hansard, Commons, 13/5/04; col. 553W.]
There is inconsistency here, and the Government refuse to recognise that the Armed Forces are a special case. If read-across is such a sacred cow which always has to be applied across the public sector, why were those changes, which introduced widows' pensions for life, not read across into the Armed Forces pension scheme at the time? Surely the Minister cannot argue that the amendment would have to be read across, when the reverse does not apply when improvements are introduced in other public sector schemes.
The Minister also said on Report:
"The special circumstances of service life are, in my view, fully recognised in the high value benefits we are making available under the new pension and compensation scheme".—[Hansard, 8/9/04; col. 610.]
I suggest that that is a smokescreen. The Forces Pension Society has contracted an independent actuary to measure the benefits inherent in the new scheme against modern good practice. The results of the survey revealed that, while the new scheme was a step in the right direction, it remained bottom of the public sector league table in all its principal benefits. Surely our servicemen deserve better.
I turn now to the serious matter of cost implications. Throughout our discussions on the matter the Government have repeatedly returned to the assertion that the retention of pensions for life for non-attributable widows is unaffordable. In its memorandum dated
In the same memorandum, the MoD attributed £500 million to the cost of retrospection. The Minister continues to trot out that figure. Retrospection and the £500 million figure have been the bone of contention in our debates. Our amendment is not retrospective in that it proposes paying only from
Yet it was only today, late this morning—when I was also not in my office—when the Bill has passed through the other place and had its Committee and Report stages here, that I received from the Minister a letter setting out the cost implications in proper detail. I thank the Minister for that letter, but I cannot emphasise enough how disappointed and frustrated I am that it has taken so long for the Government to give a comprehensive response.
The amendment was intended to remove a long-term injustice that causes disproportionate grief and suffering for the small and diminishing number of victims. I do not agree with the implication that there would be a cost of £3 billion because of the read-across to the rest of the public sector. We have already seen that the Government are not bound by consistency. However, I understand that at this late stage in proceedings and when a Bill has to pass Parliament within a few weeks, it is essential that we take more time to review the alleged implication cost. It would therefore be undesirable to press the amendment today.
I think that the House and all those interested in this worrying issue will feel let down that those detailed figures have been produced so late. If the costs were to prove to be far less than have been alleged, there would be deep anger in service circles. But this House cannot press expenditure on the scale alleged on another place, nor could our party entertain such a commitment without weighing the many other calls on the public purse in general and the defence vote in particular.
This is a serious problem which, were we in power, we would put every effort into trying to rectify. However, I realise that in these circumstances I cannot responsibly press the amendment. I hope that the Minister will give a commitment to look further into the issue to see if there is any way in which it can be resolved in the future. I beg to move.
My Lords, I rise to support Amendment No. 3. I make no apology for reiterating some of the telling arguments that the noble Lord, Lord Astor of Hever, has placed before your Lordships.
The Minister has argued that it is not possible to treat service non-attributable causes of death differently from other government employees, because the non-attributable causes of death are similar. However, only the Armed Forces differentiate between causes of death in that way. They deserve to be treated separately.
Noble Lords should remember that the MoD has now embraced the principle of widows' pensions for life, which is very good news. The MoD and the Government did the right thing to help attributable widows in 2000. The political will was there and the money—not much—was found. The new pension scheme will no longer differentiate between service attributable and non-attributable deaths in relation to widows in the new scheme. By persisting in not granting the proposal in this amendment, the Government would create a new widows' legacy issue.
All efforts should be directed to trying to remove or ameliorate those disgraceful and heart-rending legacy issues, which affect a small and vulnerable group. It seems totally callous to be prepared to accept the creation of yet another legacy issue which, with political will and a more realistic application of the interdepartmental accruing superannuation liability charge rules would ensure that there was not another new legacy issue, nor a great financial penalty to the Ministry of Defence.
The legacy issue will haunt the Government; and, more importantly, penalise a vulnerable group in society. The numbers involved are not great. They will decline from the introduction of the new scheme anyway. Moreover, because we are considering how many non-attributable widows might actually remarry, it is savings forgone by the MoD rather than up-front costs that would arise. I urge the Government to take this small step of great importance to a relatively small number of widows.
I hope that even now the Government will think again and be remembered for behaving honourably, generously and indeed logically. It is time to put the matter to rest to help those who might wish to remarry but face the unenviable choice of having to remain single to preserve their pension benefit. I strongly support the amendment.
My Lords, I also support the amendment. I was surprised to hear that the noble Lord, Lord Astor, was planning not to press the amendment. It is up to any other noble Lord to press the amendment, and I think that we would support it. I thank the Minister for his letter, and I agree that the case he has put for the amendment's financial implications is compelling. However, I was slightly surprised by the argument of the noble Lord, Lord Astor, that we have to scrutinise the Bill to the utmost extent and therefore we should not press the amendment. That would be slightly strange at this stage in the Bill, because it is the last opportunity that we have to scrutinise it.
I know that the Minister will say, as he has done at earlier stages of the Bill, that the calculations that have been made show that this provision cannot be afforded. I believe that it is the duty of this House, specifically as regards information that was not available to us at earlier stages of the Bill but is now available, to send it back to the other place for reconsideration. If it comes back, it will be for this House to decide whether to move forward with the Bill given the many benefits that it contains.
If we do not press the issue, the opportunity to do so will be lost to this House for a number of years. We are talking about legacy issues, some going back almost 30 years. The number of affected people is dwindling. By the time the next such amendment to an Armed Forces pensions Bill comes before either House the number of affected people may well be insignificant and therefore the measure will be almost affordable. However, that does not alter the moral imperative that this issue should be looked at once again.
My Lords, I, too, support this amendment. However, I should first declare an interest—I am privileged to be a Vice president of the Forces Pension Society. I have long believed that the treatment of the widows of our servicemen who die (from whatever cause) while serving in the Armed Forces has been less than generous. I am very pleased to note that this Bill will in future place all widows (both attributable and non-attributable and, indeed, unmarried partners) on an equal footing. In the future all will keep their pensions for life regardless of whether they choose to remarry or to cohabit.
The reason that I support this amendment is that should this Bill go forward in its present form the Government will wilfully and knowingly create a new group of disadvantaged widows. These are the existing non-attributable widows who will lose their forces family pension should they elect to remarry or cohabit at some time in the future. I have little doubt that in due course they will become a thorn in the side of officials and Ministers; the only service widows who will still be required to choose between perhaps their future happiness and financial security.
Finally, it strikes me as more than a little strange that in future the survivors of partners (heterosexual or homosexual) who have never married will keep their pensions for life even if they choose to establish a new liaison. At the same time existing non-attributable widows will lose theirs should they choose the more conventional course of remarriage. I am tempted to say that perhaps this might be taking political correctness a step too far. Nevertheless, I know that this amendment would resolve this longstanding injustice once and for all.
My Lords, I believe that the figures are not yet clear. I say with no disrespect to the noble Lord that we have been rather muddled by the different quantities that have been thrown at us regarding this particular problem. I see this as a diminishing cost but I see one thing that I believe is far more important; namely, that in my fairly long experience I am sure that it is the duty of this House to persuade any government who are in power to put a wrong right. This is a wrong and I believe that the Government should put it right. I support this amendment.
My Lords, I, too, strongly support the principle that we are here to do our very best. If that very best does not succeed, we shall at least have used what powers we are given by Parliament in endeavouring to persuade the Government that this important issue should be treated properly. All the arguments have been made and I do not need to make them again. However, it makes very little sense for this House to exist if we do not do what we are here to do.
My Lords, we have heard much this afternoon about affordability. Yet little has been said about the attrition inflicted on war widows by age-related diseases and disabilities. Their number is declining year by year and the totality of the costs of war widows' pensions is falling in real terms. The noble Lord, Lord Redesdale, was right to say that time is extremely important. Over the next few years more and more widows of the Second World War will have died. That will further reduce the cost of war widows' pensions. I think this is a moment for generosity and for recognising, as was done in the memorial services held on the 60th anniversary of D-Day, just how indebted we are to those whose problems we are addressing this afternoon. I hope very much that what has been said will be listened to carefully and sympathetically by the Minister and that we will hear from him authentic figures this afternoon about the declining total cost of war widows' pensions year by year.
My Lords, I should like briefly to support what has been said already. I do so as president of a Royal British Legion branch who very often accompanies my welfare officers. It is quite staggering at ground level when you meet these pathetic cases time after time without any real opportunity to put them right. Therefore, I plead with the Minister to listen very sympathetically to what is said and, as I say, put this matter right.
My Lords, I, of course, recognise the strength of feeling behind this amendment. I thank all noble Lords who have spoken for the reasonable way in which they have put their arguments in favour of this amendment. The strength of feeling has been well illustrated by debates on this issue at earlier stages of the Bill, and not least by the debate at Third Reading.
I hope it will be helpful if I take a little time—I hope that it will not be too long—to give the House a little background. The proposed new Armed Forces pension scheme includes provision for non-attributable widows' and widowers' pensions to be paid for life. Existing members can, of course, transfer to the new scheme if they wish to benefit from this provision. The new clause proposed here would extend this to current widows and widowers from April 2005 who are not provided for in the new scheme, including the widows and widowers of those who have already retired.
For the majority of public service schemes non-attributable widows' and widowers' pensions still cease on remarriage. These pensions can be reinstated on second widowhood or divorce if the individual is otherwise financially worse off than when first in receipt of their Armed Forces pension. While we are able to make changes for the future under the new Armed Forces pension scheme—and, importantly, that will be paid for by adjusting benefits elsewhere in the new scheme—changing an arrangement for the current scheme would carry with it no offsetting saving. It would, therefore, be an expensive change with—here I disagree with the noble Lord, Lord Astor—retrospective effect; retrospective because this amendment would enable past service of a service person prior to April 2005 to count towards a widow's pension on remarriage. It would require us to provide benefits against service where in the past there was no entitlement. As I said, these pensions can be reinstated. It would therefore be an expensive change. Together these would make it a deeply unattractive change, I am afraid, to a government of any colour.
Against this background, I propose to talk about two things: cost and retrospection. I know that there has been some confusion on the cost issue. I am grateful to the noble Lord, Lord Redesdale, for his mention of the letter that has recently been sent. I do not think there is any confusion about retrospection.
I shall do my best to explain the different aspects of the costs involved, following the debate at Report on this issue. I have written to the noble and gallant Lord, Lord Craig, in an attempt to clarify this difficult aspect and I have copied this letter to other interested noble Lords. Let me repeat some of those points.
I start by explaining the difference between past and future costs. That is not the distinction between the cost of providing benefits retrospectively and the paying of benefit from now onwards. Rather, it relates to the fact that benefits must be bought by the department over the length of an individual's service. Where payments were not made, the benefit was not bought.
If we want to buy this benefit now for those past years of service, a past service cost would be properly charged to us by the Treasury to cover all the costs for each year of past service for all those who will benefit. The future service cost is a similar cost for each future year of service. As noble Lords know—we discussed this matter last week—that is paid annually as an addition to the accruing superannuation liability charge.
Individuals are entitled to the benefits of the Armed Forces Pension Scheme that is in place when they are serving. Those who have left the scheme and are already receiving benefits are not entitled to any improvements made to the scheme after their departure. Why? Because the sum paid annually to the Treasury by the Ministry of Defence secures only the package of benefits in place at the time, and a pension for life for non-attributable widows was not part of that package.
In describing the costs involved in making the change, I have referred in past debates to three different figures: future and past service costs for the MoD and the past service costs for all public service schemes. Let me deal briefly with each of these costs in turn in so far as they cover the current proposal to give non-attributable widows pensions for life.
First, the future cost of £14 million a year covers the future service cost. This cost gives the benefit only in proportion to future service. Let me give an example. An individual with, say, five years' service left would earn benefits based only on these years, so if he had a total of 20 years' service only one-quarter of his widow's pension would be extended for life by this £14 million measure. This measure would not address the fact that the department has not in the past made payments to the Treasury to cover previous years of service.
Secondly, the £500 million—half a billion pounds—is the one-off cost to the Ministry of Defence to cover the years of past service. In my earlier example, the widow would be entitled to benefits based on the full pensionable career of 20 years, if this payment was made, as well as the £14 million a year for each year of future service. This would cover all existing pensioners and ex-service personnel.
None of these costs would allow for backdating of pensions of those widows or widowers who had already remarried and lost their pension at the date of change. The costs are based on pensions being reinstated only from the date of any change. Backdating would increase very substantially the cost of change, although we have not made an estimate of this more far-reaching option.
Thirdly, the £3 billion is the past service cost extended to cover provision of this additional benefit across all public service pension schemes.
I mentioned in the debate that serving personnel will be able to get the benefit of a non-attributable widow's pension for life by joining the new pension scheme when they are given the choice. To do so they will, of course, have to give up benefits in the current pension scheme, such as the more generous immediate pension, and they will need to decide whether the trade-off is reasonable. We have been able to afford the benefit for the new AFPS because it will be paid for by a reduction in benefits elsewhere in the scheme.
I do not accept, again I am afraid, what the noble Lord, Lord Astor, said about the new Armed Forces pension scheme being somehow bottom of the public service scheme. It is true that in some areas the new scheme does not match every best practice. There will always be a need for balance across the scheme, but there are areas where we match and perhaps go further than best practice. That includes the level of death-in-service benefit and the very early mid-career departure benefits. The early retirement age is exceptional—better than most—as is the rate and levels of widows' pension accruals.
This is a good scheme and we believe that that was the view shared not just within the Armed Forces but by many bodies which work for the Armed Forces and veterans outside. We have independent confirmation from respected actuaries—Watson Wyatt—to confirm what I have just said.
I am bound to resist the amendment, although, to answer the point of the noble Lord, Lord Astor, of course we will look yet again to see if there is anything we can do. But I do not hold out any realistic promise of being able to answer the deeply felt pleas made in the House. I have to resist the amendment, also, because of any government's clear policy on non-retrospection—
My Lords, when we make a concession—for example, the concession we made on pre-1973 widows last week—what we have to do is done outside the Bill. I am not sure what the answer is. Or perhaps I do know the answer—by magic! We do not need primary legislation to make such a change. But we will look again at that matter if we are asked to by the House. However, I cannot say that there will be any change in the position I am taking now.
As regards the retrospection issue, noble Lords have heard me—and, if they have been in this House long enough, those from the previous government—say exactly the same about retrospection. I do not apologise for that. Serving personnel are entitled to the pension benefits earned while in service under the terms of the scheme in place at the time. They are not entitled to any later improvements to the scheme made after they have left. To do so would place an undue financial burden on the taxpayer and might prevent us making worthwhile improvements.
I am sorry that I cannot give a more positive response to what has been a very eloquent presentation of the case on the other side, but I hope that noble Lords will at least understand the reasons for the Government's resistance.
My Lords, I am grateful to the Minister for his response. I am not convinced by it at all. I accept the commitment he has made to look at this problem. The Government do not need primary legislation and I hope that Her Majesty's Government will do something about this issue.
I accept the strength of feeling throughout the House, not least from the noble and gallant Lords, Lord Craig and Lord Guthrie, the noble Viscount, Lord Slim, the noble Lord, Lord Redesdale, my noble friend Lady Park, and the noble Lords, Lord Morris and Lord Molyneaux. The Minister failed to answer my question about why £8 million per annum went shooting up to £14 million per annum. The noble Lord and I must disagree on the definition of retrospection. I do not think that the Minister has satisfactorily clarified the mysteries of the accruing superannuation liability charge.
However, as I said earlier, we feel that it is inappropriate to vote on this issue. I beg leave to withdraw the amendment.
moved Amendment No. 4:
After Clause 6, insert the following new clause—
As of 6th April 2005 widows, widowers and surviving registered unmarried partners of all service personnel shall receive a full widows' forces family pension based on their spouses or partners length of service and final salary, provided that their marriage took place before the service personnel's 60th birthday."
My Lords, in speaking to Amendment No. 4, I am returning to a subject on which I spoke during Grand Committee and on Report. It is a matter the Government must resolve in order to bring justice to an unfairly disadvantaged group of elderly widows whose husbands served for many years in the Armed Services, yet who now have no widow's pension.
The armed services have a unique retirement structure. An astonishing 70 per cent of those eligible for a pension are obliged to retire at around the age of 40, most having already served for two decades, while a smaller number, around 5 per cent, serve until the age of 55. Those who have served the requisite number of years—22 for other ranks, 16 for officers—have traditionally been entitled to a pension, as have their widows.
Since 1978, those who married after they retired have also been able to leave their widows a pro rata pension, as has been the case throughout the public services. However, those who left up to 1978 and subsequently married or remarried are unable to pass on any pension at their death, however many years they served.
As the Minister is aware, the Armed Forces differ utterly from other public services in having such an early compulsory retirement, making the chance of a post-retirement marriage so much greater than would otherwise be the case. By comparison, the retirement age for the vast majority of the rest of the public services is 60, and was 65 in the 1970s, enabling even those who retired pre-1978 to pass on a widow's pension to anyone they married or remarried before the age of 60. Is it reasonable that the forces should be at such a disadvantage in what they can offer their widows? I do not think so.
Although the pension change for public services in 1975 was a significant improvement, it is unlikely that anyone intended that there should be a 20-year disparity between post-retirement marriage terms in the Armed Forces and the rest of the public services. In other words, any other member of the public services can marry between the ages of 40 and 60 and pass on a pension to that spouse. Only the Armed Forces are unable to provide for wives married during those years.
The purpose of this amendment is to put those in the armed services on an equal footing with civilians in this respect. They may have a shorter career from which to draw a pension, but why should they be financially penalised for marrying later in life? They are denied the financial benefit enjoyed by those who served at the same time but happened to marry earlier. Although a forces career ends at a comparatively young age, it none the less uses the best years of people's lives in building up a pension, so most pre-1978 forces personnel would not have been able to create a second one in another profession. Furthermore, it should not be forgotten that forces personnel are obliged to serve for long periods overseas, and in stressful conditions, making finding a partner harder than in civvy street. Punishing people for electing to marry in a more settled period of their lives seems particularly harsh.
This amendment aims to give widows of post-retirement marriages the same status as public servants' widows. I therefore propose that pensions should be paid to post-retirement marriage widows, provided the marriage took place before an individual's 60th birthday. That is the age of recall liability, when a former member of the armed services can be summoned out of retirement to serve again.
The Minister has repeatedly claimed that accepting this amendment would open the floodgates to claims from others in the public services. However, I cannot understand how that would happen, as we are asking for no more than what is already available for others in public service, bar the small numbers of registered partners added in 2002, whose cost will be insignificant and will also be covered by the new scheme in 2005. The amendment also complements government policy. Such a measure would, therefore, keep read-across to a minimum. Only the police and fire services have an earlier retirement age, and even that is 55.
The Minister has repeatedly argued that it is not possible to treat the Armed Forces as different from other public service workers. That seems an odd and ungenerous comment when the Government are repeatedly singling out the forces for praise in Iraq, Afghanistan and the former Yugoslavia, to name but a few countries where they are working under uniquely hazardous circumstances, as did their counterparts in the 20th century.
The Minister is missing the point, however. I am not asking for special, but rather equal, treatment. The rough estimate cost of £50 million is galling to those affected. The Government have saved a considerable amount of money over several decades by not paying post-retirement widows' pensions—pensions that service people believed they had earned—yet they use an alarming-sounding figure to continue to avoid paying anything at all.
The Minister announced last week on Report that he would attempt to give me a breakdown of the alleged £50 million cost. While I am grateful for the letter I received from him yesterday in which he explained what kind of data the Government used to support their figure, once again no figures were attached. It is, therefore, impossible to know how the estimate has come about. What is clear is that the sum required is diminishing and contained, as well as being in a just cause.
As I mentioned on Report, and would like to reiterate, the Labour Party recognised the injustice suffered by such PRM widows in 1995, when, led by the esteemed noble Baroness, Lady Hollis, they supported a similar amendment during the Pensions Bill of that year. Nine years on, nothing has changed, except that the widows have become older and more vulnerable.
I shall give an example. Mrs "W" from Devon was married to a regular officer in the Royal Engineers, who served in both world wars. His first wife died of cancer in the 1950s; he had retired from the Army to look after her. He married again, three years after her death, not knowing at the time that his widow would receive no pension. Since his death in 1984 she has been obliged to work, only retiring last year, and then unwillingly, at the age of 78.
I understand the Minister's need to hold a strong line on retrospection. However, can it be right that it is considered more important to stick to an arbitrary cut-off point than to deal with a situation that was unfair at the time and has become increasingly punitive 26 years on? Is the Minister really saying that, where injustices are acknowledged, there should be no recourse to correcting them? Elderly men and women are not simply statistics. If they are forced to live in straitened circumstances because of the Government's inflexibility when it comes to correcting a clear injustice, we have created a situation of which we should be ashamed. I beg to move.
My Lords, I support the amendment, mainly for the reasons that I gave in supporting the previous one. This is another legacy issue. If we do not raise the issue with the Government at this point and send it back to the Commons, it is very unlikely that the focus that the Minister talked about being placed on it will be directed with any alacrity, as has been shown on so many legacy issues over the past two to three decades.
The point made by the noble Lord, Lord Freyberg, about read-across seems fair. Although it is threatened that immediately we would have to read across into other schemes, it has not happened with the Armed Forces pension scheme. Therefore, it is important that another decade does not elapse before the issues are looked at again. Perhaps this is a time when the Commons can be given the figures that have been denied us through these stages of the Bill, and therefore make a decision on the merits of the case.
My Lords, despite a strongly argued debate, I propose to resist Amendment No. 4, for the reasons that my noble friend Lord Bach set out on Report: principally the cost issue and the fact that it breaches the Government's clear policy on non-retrospection.
Perhaps it would be helpful if I first reminded the House of the key background to the debate. Post-retirement widows' pensions were introduced following government-wide changes in policy through the Social Security Pensions Act 1975. Provision was made in the current Armed Forces pension scheme for the payment of pensions to widows of service pensioners who married or remarried after retirement. But that change benefited only widows of those giving service on or after
Amendment No. 4, if carried, would have three effects. First, it would allow all service widows and widowers to qualify for a post-retirement widows' pension, provided that the marriage or partnership started before the serviceperson's sixtieth birthday. Secondly, it would increase the rate of post-retirement widows' pensions for those widows and widowers who currently receive a post-retirement pension based on only that part of their spouse's service after the changes were made. Thirdly, it would improve the benefits of unmarried partners who currently receive benefits only if their partners are attributably killed in service—that is, if their death is due to service.
The noble Lord, Lord Freyberg, said on Report that he sought only to give service personnel parity with personnel in other public service schemes. He argued that, because service personnel are "obliged to retire" well before the normal retirement age of 55, it puts them at a disadvantage compared with other public servants, who are more likely to serve a full career to age 60. However, the basic rules apply equally in all public service schemes.
Other public servants are equally unable to marry after leaving service and pass on benefits to their widow for any service before April 1978. There is a clear cut-off in all public service schemes between pre-April-1978 and post-April-1978 service, with "post-retirement" defined as after leaving the relevant service. Equally, many of those who leave the Armed Forces before the age of 60 do so by choice, while many in other public service schemes are obliged to retire. I am clear that we would not be able to make a special case for Armed Forces personnel who marry in retirement before the age of 60 that other public services would not argue should apply equally in their own schemes.
My noble friend said on Report that the Government Actuary's estimate of the cost of allowing all public service post-retirement marriages to qualify for pension benefits is between £300 million and £500 million. Introducing a cut-off for those over the age of 60 would still leave us with an unaffordable cost. There is no significant distinction between Armed Forces personnel and other public service employees in this area. There are those serving in all schemes who have been obliged to leave early and who have then married after retirement, so we could not justify making a change only for the Armed Forces. I must remind the House that, on every occasion where such issues are under debate, it has been a longstanding policy of successive governments that changes to improve the benefits from public service pension schemes should be implemented from a current date for future service only.
For the Armed Forces alone, the Government Actuary has estimated that there would be a one-off cost in the order of £50 million to extend post-retirement widow and widower pensions to all current and deferred AFPS pensioners. This cost would increase if unmarried partners were included, but it is difficult to estimate given the limited information on the number of partners who might be eligible. There would be no future annual cost. I am afraid that I will have to resist the amendment.
My Lords, I thank the noble Lord, Lord Redesdale, who spoke in support of the amendment. I also thank the Minister for her reply, although I am unable to agree with much of what she said. She is wrong to contend that there will be a significant read-across with others in the public sector or to assert that £50 million is in any way an accurate figure.
I urge the House to remember that conditions in the forces are different from those in the rest of the public services. There is extreme danger to be endured, living abroad for long periods and, most of all, the knowledge that your chosen career could be cut short at around age 40. No other public career makes such demands. Is it not reasonable that your spouse should be able to inherit the share of the pension that you earned under such conditions? All that I ask is that those service widows should be put on the same footing as other public servants' widows and not be significantly worse off. This amendment would make that happen for the first time and therefore I urge the House to support it. I should like to test the opinion of the House.
My Lords, I beg to move that this Bill do now pass.
Moved, That the Bill do now pass.—(Lord Bach.)
On Question, Bill passed, and returned to the Commons with amendments.