Only a few days to go: We’re raising £25,000 to keep TheyWorkForYou running and make sure people across the UK can hold their elected representatives to account.

Donate to our crowdfunder

Armed Forces (Pensions and Compensation) Bill

– in the House of Lords at 2:30 pm on 2nd November 2004.

Alert me about debates like this

Votes in this debate

Moved accordingly, and, on Question, Motion agreed to.

:TITLE3:COMMONS REASONS FOR DISAGREEING TO CERTAIN LORDS AMENDMENTS

[The page and line references are to HL Bill 70, as first printed for the Lords.]

:TITLE3:LORDS AMENDMENT

1 Clause 1, page 1, line 14, at end insert—

"( ) Any scheme established under subsection (2) must provide that there shall be no onus on any claimant under the scheme to prove the fulfilment of any conditions for a claim thereunder and that the benefit of any reasonable doubt shall be given to the claimant."

The Commons disagree to this amendment for the following reason—

1A Because it could allow a claim to succeed even though the conditions for entitlement were probably not fulfilled.

Photo of Lord Bach Lord Bach Parliamentary Under-Secretary, Ministry of Defence, Parliamentary Under-Secretary (Ministry of Defence) (Procurement)

My Lords, I beg to move that the House do not insist on its Amendment No. 1, to which the Commons have disagreed for their reason numbered 1A.

For the convenience of the House, I intend to save my substantial remarks until I have heard what my noble friend Lord Morris, and other noble Lords, have to say.

Moved, That the House do not insist on its Amendment No. 1, to which the Commons have disagreed for their reason numbered 1A—(Lord Bach.)

Photo of Lord Morris of Manchester Lord Morris of Manchester Labour

rose to move, as an amendment to the Motion that the House do not insist on its Amendment No. 1, to which the Commons have disagreed for their reason numbered 1A, at end insert "but do propose the following amendment in lieu thereof—

1C page 1, line 14, at end insert—

"( ) Any scheme established under subsection (2) must provide that there shall be no onus on any claimant under the scheme to prove that his illness or injury (whether physical or mental) or his death, is attributable (wholly or partly) to his service in the armed forces or the reserve forces and the benefit of any reasonable doubt shall be given to the claimant.""

Photo of Lord Morris of Manchester Lord Morris of Manchester Labour

My Lords, the Prime Minister's first words to the House of Commons when Parliament resumed after the Recess were:

"I know that the whole House will join with me in sending our condolences to the families of the two British soldiers who have lost their lives in Iraq since the House rose on 16 September. They were doing an extraordinary and heroic job. We can be proud of them".—[Hansard, Commons, 13/10/04; col. 276.]

Let my right honourable friend's words, reminiscent as they were of those of the Chancellor and the Defence Secretary in praise of our Armed Forces, inform this debate: one of huge importance to service and ex-service personnel alike.

Never on any legislative issue was Britain's ex-service community more at one than it is now in support of this amendment. My involvement with that community is as one of them. It was 56 years ago that I completed my time—mostly on active service—in the Armed Forces; but my interest goes much further back. When I was seven my father died of war injuries and my mother made ends meet as a war widow. That involvement, even more than my work over many years as Honorary Parliamentary Adviser to the Royal British Legion and Vice-President of the War Widows' Association, is the principal interest I have to declare in this debate.

I want first to make it crystal clear that my amendment's purpose is to vouchsafe, after next April, continuance of the burden and standard of proof used in the current war pensions scheme for claims for illness, injury or death attributable, wholly or partly, to service in the Armed Forces: no more and no less. On 20 October, in the debate in the House of Commons on the amendment approved by this House on 8 September, it was said that my amendment went further than to preserve the current burden and standard of proof. My advice and that of the Royal British Legion is that it did not; but to make our intention doubly clear, I have now reshaped the original amendment. Furthermore, if Ministers can demonstrate that there could still be ambiguity, I shall be glad to consider a change of wording to achieve our stated purpose.

From the moment this Bill first saw the light of day, the Government's intention has been to shift the burden of proof from the MoD to the claimant and to change the standard of proof from the existing test of "reasonable doubt" to the much sterner "balance of probabilities". Ever since then, notwithstanding all the ex-service community's representations, the Commons Select Committee's critical report and the speeches in your Lordships' House from noble and gallant Lords with vast experience of our Armed Forces—they include highly distinguished former Chiefs of the Defence Staff—the MoD's position has remained fundamentally unchanged, as the noble and learned Lord, Lord Ackner, set in bold relief in his intervention at the conclusion of my noble friend's speech on 8 September.

The Royal British Legion's view is that, for the MoD not now to modify its position, would be,

"a dire and retrograde step for those serving in the Armed Forces in the future".

Yet the MoD still wastes time bogusly claiming that "balance of probabilities" is more modern and fairer than "reasonable doubt". In truth, of course, it is as old as the hills. It was in fact replaced by "reasonable doubt" in 1943. Thus what the Government are now proposing is to put the clock back 60 years. Similarly the claim that "balance of probabilities" is fairer than "reasonable doubt" is demonstrably bogus. And my sources for that statement include my noble friend himself when he replied, on 22 January, to my Starred Question about the case of the late Major Ian Hill, following the coroner's landmark finding at the inquest into his death: "I can say", my noble friend told the House,

"that war widows' pensions are paid when death is deemed to be due to service, and that the war widow has to raise only a reasonable doubt for claims to succeed".—[Official Report, 22/1/04/ col. 1138.]

This most important safeguard in the existing war pensions scheme was the core of my noble friend's justification of the handling of Major Hill's case and clearly, in his view, the scheme's crowning virtue.

Yet now, while the MoD admits that successful claims for war and war widows' pensions will be reduced, my noble friend is made to argue for the dumping of that safeguard—and shifting the "burden of proof" from the MoD to the claimant—to produce a saving for the department of what this House was told on 8 September is £200 million and the House of Commons was told on 20 October is £300 million. Thus in the MoD's case "cherry picking" includes the right even to pick—and change from month to month—its own unverifiable price tags.

As Colonel English, known to all of us here for his unwavering commitment and abiding concern in working for the Royal British Legion, says:

"Of course, there is another way of describing the cost to the MoD of £200-300 million if the MoD fails to defeat your amendment on burden and standard of proof. If they succeed it will cost disabled ex-service men and women—and the dependants of those who lay down their lives—exactly the same £200-300 million".

Ignoring the Prime Minister's recent comments on the high importance of the role of this House as a revising Chamber—charged with the duty of detailed parliamentary scrutiny—the MoD's posture now is not only to refuse to discuss a suggested compromise, even one that could be backed both by the Legion and the Commons Defence Committee, but also to insist that if it does not have its way there will be no Bill at all.

Yet where could the Prime Minister's assessment of the importance of the legislative role of this House possibly be more crucially relevant than in scrutinising and revising—sustained in doing so as we are by former Chiefs of the Defence Staff—a Bill affecting the interests of ex-service personnel in broken health and the bereaved families of those who die in the service of this country?

Our Armed Forces have an unlimited liability to serve anywhere, at any time, under any conditions and to put their lives on the line. That does not apply to any other occupation and, with no resource other than the Legion to represent their interests, service personnel are heavily dependent on Parliament for a fair and continuing recognition of their needs.

That is the context in which we debate this amendment. There is no other group of people exposed to the hazards faced by our Armed Forces in all corners of the globe and none more reliant on parliamentary concern for their interests. They have no trade union or federation to protect them. Nor are normal commercial rates for permanent ill-health or disability insurance available to them. That is but part of the case for recognising the bounden duty of Parliament to do its best for the Armed Forces.

It was argued for the MoD in the House of Commons that the amendment on burden and standard of proof carried in this House on 8 September would allow a case to succeed even if the conditions for entitlement were not met.

Nowhere has the department provided any evidence of unmeritorious but successful war pension claims such as to cause concern, however, let alone a concern that what has worked perfectly well for 60 years has suddenly been undermined. Instead the ex-service community is left resentful of what it sees as double standards.

While the Prime Minister, backed by senior Ministers, speaks in the highest praise of our Armed Forces as the finest in the world, spin from inner Whitehall works to create the impression that—driven by a so-called "compensation culture"—the ranks of those incapacitated by war service are riddled with benefit cheats and lead swingers.

The Royal British Legion asked for any evidence the MoD has of abuse of the war pensions scheme. None has been forthcoming; and there can be no complaint now if war pensioners say that current reality is not a "compensation culture" in the ex-service community but an "obfuscation culture" in inner Whitehall.

Again, the impression was given in the House of Commons that the Royal British Legion has been unwilling to offer any kind of compromise. There was no mention there of the Legion's suggested compromise in a letter to Ivor Caplin dated 3 March 2004, to which he replied on 26 March rejecting the suggestion and commending the findings of a badly flawed report commissioned from the consultants Watson Wyatt by the MoD.

Clearly Watson Wyatt has a wide knowledge of pension schemes, but not it appears of war pensions schemes. In the UK the current war pensions scheme has no comparator with any other scheme, whether in the public or private sector. That is because there is only one such scheme, whose provisions are unique to the Armed Forces in recognition of the extent of their commitment to the state.

The only meaningful comparison would have been with similar schemes, requiring unlimited liability from service personnel, in other developed countries that play a significant role in international affairs. The trap Watson Wyatt fell into in comparing the war pensions scheme with other pension schemes in the UK was that laid by the MoD's instruction—based on the bogus assumption that service in the Armed Forces is essentially no different from civilian employment—to compare the scheme with schemes where no valid comparison could be made.

By contrast the Royal British Legion was then working to document the effects of abandoning the current burden and standard of proof for incapacitated service personnel. The outcome was to show that, taken together with the MoD's proposal to reduce to five years the time-limit for making a claim, it could cut the number of successful claims by up to 60 per cent.

That finding was based on scrupulous analysis of the vast casework undertaken by the Legion, particularly that gained when acting for claimants in 93 per cent of all represented appeals at tribunals for war pensions, and totalling over 4,000 cases in the last year for which I have figures. The Government's response to that was to cast doubt on the Legion's analysis, while doing nothing whatever to produce one of their own.

Instead, the Government made the assertion—strongly renewed in the debate in the House of Commons on the amendment approved by this House on 8 September—that those who wanted to preserve the burden and standard of proof of the current scheme were opposed to higher benefits for more severely disabled ex-servicemen and women. It is, of course, totally preposterous to say that supporters of the current burden and standard of proof—and by implication the Royal British Legion—have taken any such stance. The Legion's door is open to all ex-service personnel in need of its help and, in fighting their corner, it insists on help in proportion to need for all.

How otherwise could its reputation be so universally high? Again, how else could the Legion attract so many volunteers to sell poppies year by year, as tens of thousands of them are now doing, all over Britain, even as I speak?

Moreover, if any MoD Minister thinks that his sternest critic is the Royal British Legion, I can introduce him to ex-servicemen and women who see the Bill, as it relates to burden and standard of proof, as the biggest stitch-up since the Bayeux Tapestry. In deference to the normal decencies, I am slightly moderating their actual words.

It was not the Legion that decided this Bill must be cost-neutral. It was executive government in the world's fourth-richest economy. In the ex-service community's view, it is demeaning of any department of state—most of all the MoD—to burn the midnight oil working on ways to cut spending on any entitled person's war pension or bereavement benefit. After all, what is being one of the world's richest economies worth if it does not enable a country to act justly and generously to those prepared to lay down their lives in its service?

There is no manifesto commitment involved here. Nor is there ever likely to be one for a policy change in opposition to which the ex-service community is so completely at one. The amendment is not against anyone, least of all my noble friend, for whom indeed I have every sympathy in his role—in so many of our debates—as the lone proponent of changing the burden and standard of proof. His lonesome stance reminds me, as he knows, of Oscar Wilde's sad comment at the first night of one of his plays:

"The play was a great success", said Oscar,

"but the audience a failure".

My amendment repairs a disfiguring fault in the Bill and is about acting justly toward and keeping faith with men and women who deserve well of this House and of Parliament as a whole. I beg to move.

Moved, as an amendment to the Motion that the House do not insist on its Amendment No. 1, to which the Commons have disagreed for their reason numbered 1A, at end insert "but do propose Amendment No. 1C in lieu thereof".—(Lord Morris of Manchester.)

Photo of Lord Astor of Hever Lord Astor of Hever Deputy Chief Whip, Whips, Shadow Minister, International Affairs

My Lords, I start by declaring an interest as president of the Earl Haig branch and the Kent County branch of the Royal British Legion. The noble Lord, Lord Morris of Manchester, made a strong argument for his amendment.

Only this morning I received a copy of the Minister's letter, dated 29 October, to Ian Townsend of the Royal British Legion—which he has not yet received. That is the second time that a detailed letter has arrived on the morning of the debate. I complained last time about receiving detailed costings at the last minute. The enclosure in the letter is from the Government Actuary, dated 14 October. The meeting, to which the Minister refers as having taken place between the Royal British Legion and its legal adviser on one side and the MoD on the other, was on 15 July. It has therefore taken the Government Actuary three months to produce the letter. It has then taken more than two and a half weeks for the MoD to send the letter to the Royal British Legion.

The letter of 14 October from the Government Actuary is predicated on an assumed additional number of successful claimants totalling 1,600. That is information which the MoD has provided to the actuary as an assumed figure. We have no way of knowing whether that assumption is reasonable. However, implicit in the MoD advancing that assumed figure is its acceptance that 1,600 people, who previously would have received a war pension under the existing scheme, will now no longer be eligible because they will not be able to discharge the burden of proof imposed on them.

In the other place, Ivor Caplin argued that the amendment moved by the noble Lord, Lord Morris, and passed by this House went further than the existing war pensions scheme. That does not appear to be borne out by the Government Actuary, who uses the words, in opening:

"I am writing regarding the extra costs that would arise from changing the proposed Armed Forces Compensation Scheme with the change in the burden and onus of proof to that currently applying to the War Pensions scheme. This would reflect the apparent intention of the recent Lords' amendment".

Therefore, the actuary appears to understand the amendment to apply the war pensions scheme burden, but the Minister in the other place was trying to spin it further than that.

The actuary then hedges the advice by saying:

"Clearly predicting how such an amendment would work in practice is difficult and you have to make a number of assumptions on the potential impact".

Indeed, the actuarial calculations are laced with broad estimates, uncertainties, caveats and being subject to margins of error. But the Minister, in his letter, appears to have transformed those into a certain sum of money. It is unacceptable for the Minister to come to the House at the 59th minute of the 11th hour and seek to railroad us into accepting a proposition based on simulated figures. Why should we believe them? We question the Government's figures of more than £300 million over 10 years. Only a month ago, that was £200 million. It is unfortunate that Ministers choose to inflate annual figures into headline-grabbing figures over 10 years.

The Minister's letter, although making it perfectly clear that the Government's position is unchanged, contains some helpful points, and it is a pity that those were not raised earlier. If they had been, it would have made for better co-operation. The Minister must by now be aware of the genuine anxieties from all sides of the House about the way in which the new scheme will work.

The Government appear not to be prepared to compromise or to give an inch. The noble Lord, Lord Morris, has said that he is perfectly willing to discuss the fine wording of the amendment to meet the Government's latest criticism. Members on all sides of the House will recognise the tremendous work carried out by the Royal British Legion. The RBL has made it clear to the Government that it is prepared to discuss compromise. The MoD has suggested that a burden of proof based on reasonable doubt permits many spurious claims to succeed. The RBL tells me that it would not support this, nor would it support any claims it believed to be spurious.

The Government's overt threat is to abandon the Bill if they cannot have their way. The inference is that it is others, including the RBL, all of whom have the best interests of the Armed Forces in their minds, who are being uncompromising.

The Government have produced questionable figures at the very last moment. This sends the wrong message to our Armed Forces if they are injured or become ill in the line of duty. We on these Benches recognise the unique status of members of the Armed Forces. This particularly relates to their unlimited liability to serve anywhere, at any time, under any conditions and, very often, with the requirement to put their lives on the line. Her Majesty's Government must provide them with much greater confidence in the new schemes.

Photo of Lord Redesdale Lord Redesdale Shadow Minister, Defence

My Lords, perhaps I should start by not declaring an interest, in that I am not a member of the Royal British Legion, because I know that the Minister will also declare an interest. However, I must say that the work undertaken by the RBL has been unstinting on behalf of its members and, despite the strong exchange of words over the timing of letters and their contents, I do not think that anyone in the Chamber will undervalue the work, and future work, of the RBL for the former services community.

The noble Lord, Lord Morris of Manchester, set out clearly and comprehensively the problems that face us, as has the noble Lord, Lord Astor of Hever; so I shall not examine the minutiae of the amendment. However, it goes to the fundamental concept that underpins the Bill—that it has to be cost neutral. That means that, while we have heard much about the winners from the scheme, the amendment underlines who shall be the losers.

There are certain people who, by not receiving benefits, will pay for the improved benefits that are welcome. One of the issues that has unsettled us is that it was seen as being necessary for the Bill to be cost-neutral. The Minister has talked about best practice. Obviously we would like to see this scheme in operation, given that it is for a special group of people. We have talked about whether one can put one group of pensioners above another. However, we are dealing with a special group of people to whom we owe a debt. It is unfortunate that the Government have stuck to the cost neutral aspect.

I believe that the noble Lord, Lord Morris, will take this matter to a Division; and I know that the Minister will say that if the vote is carried that the Bill will be abandoned and all the benefits that would accrue from it would be lost. It is unfortunate that that state of affairs has come about and is the choice before us.

Photo of Lord Craig of Radley Lord Craig of Radley Crossbench

My Lords, the burden of proof issue has not suddenly been sprung at a late stage on an unsuspecting and unsighted Ministry of Defence. There has been a series of meetings and exchanges about it between the Royal British Legion, MoD officials and Ministers over many months. It has been at the heart of the RBL's concerns. The issue was extensively debated at Second Reading and, before that, in another place. I shall not repeat the arguments now, except to remind the House that on Second Reading the Minister relied primarily on the argument for adopting the balance of probabilities standard because it,

"is used widely elsewhere".—[Hansard, 10/06/04; col. 495.]

We have now heard from the noble Lord, Lord Morris, regarding the £200 million and £300 million figures that have since been introduced. Ministers need to explain themselves.

What leaves a most unfortunate impression is that the MoD has no firm idea of the possible financial penalty. It did not even pray that in aid to start with, but has since been ratcheting it up to support the latest plank of resistance—that it is just too costly. The pressure on this House and another place to cave in has been further increased by explicit ministerial statements that if the Government do not get their way on this single aspect they would pull the Bill. That is a very serious position for us to face. Is it defensible?

The Armed Forces have been awaiting a new pension scheme for many years. The one that is now proposed is reasonably good. That has been said on all sides of this House and in another place. We have been told on a number of occasions that the two schemes—regarding pensions and compensation—will, in Mr Caplin's words, "each be broadly cost neutral". So some disagreement about the compensation scheme should have no impact on the balance struck in the pensions scheme. We are told that they are separate. Are the Government really so intransigent that they would let down all those service men and women that the new pension scheme will help to recruit and retain for a cost amounting, even at the worst figure that they have so far provided, to one hundred thousandth of the efficiency savings that the Chancellor has set Government to find in the next few years?

Mr Caplin further stated that the Government had,

"taken the savings from the changed burden and standard of proof and used them to provide bigger payments where the need can be expected to be greatest".—[Hansard, Commons, 20/10/04; cols. 905-6.]

Noble Lords should and have welcomed that recognition that the present scheme is not sufficiently supportive. The nub of the MoD's case seems to rest on a presumption that there is around £30 million a year, or some other large figure, that would be spent on malingerers and those who do not deserve compensation for illness or injury if the burden of proof standard is not changed.

No one would deny that in any scheme there will be those at the margin, and even those just outside it, who benefit. But we have had no clear explanation or evidence that this is both so seriously expensive and prevalent. Moreover, I believe that it behoves us to consider more closely the situation faced by a claimant. In the red corner there is the Ministry of Defence, with all the resources, experience and expertise that it could need to deal with any claim for compensation. In the blue corner is an individual, a service man or woman, who is possibly stressed and certainly with a demonstrable illness or injury. Although the MoD must provide the claimant's medical and other service records, it cannot be the referee. The individual in their corner is on their own, facing a heavy puncher on the other side of the ring. It is even suggested that legal or other assistance will not be necessary for the claimant. That would unbalance the position even more in the MoD's favour. The arrangements for refereeing a disagreement sound complex and daunting to an individual who is unfamiliar with such processes. An independent PAT and social security commissioners may become involved.

The Department for Constitutional Affairs is having to work on reform of the tribunal process because the service for appellants is not good enough or satisfactory. Does not that all sound frightening for the claimant? It fills me with foreboding. Surely, we owe it to our service men and women, and veterans, to retain a system that places the onus more squarely on the shoulders of the MoD and not the stressed individual. One has to look only at the prolonged delays and unsatisfactory treatment of Gulf War veterans by the MoD over a decade and more to appreciate that switching to a balance of probabilities is a step too far for the services.

The greatly respected Defence Select Committee in another place thought so. I agree with them. Noble Lords should also note that the MoD intends that the new burden of proof will apply to all servicemen and women from next April. So it seems that today's personnel will be deprived of their entitlement to the old standard of proof. Is that fair? Ministers stress that entitlements relate to arrangements in place when the individual was serving. When a suggested change is going to cost the MoD, Ministers resist. When the MoD spots a saving, the individual must accept it. It is a "heads I win, tails you lose" situation.

The Government are prepared to short-change compensation standards for today's servicemen and women but will not agree to help others who are short-changed in the legacy issues. I support the amendment, which is designed to do no more and no less than to continue an arrangement that has been in place since 1942. Today's servicemen and women deserve it; so do new recruits. I support the amendment of the noble Lord, Lord Morris.

Photo of Lord Bramall Lord Bramall Crossbench

My Lords, I find myself in a painful quandary as to the best way forward for this most important Bill. I am also in some contention with my noble and gallant friend, whose views I greatly respect, and it is always good to see two five-star officers going at each other.

These two amendments, over which on Report in your Lordships' House the Government were defeated and which have since been rejected in another place, continue of course to remain matters of deep concern. That is the case in relation to the first one on the burden of proof in the compensation scheme—so ably and, indeed, passionately championed and still being championed by the noble Lord, Lord Morris of Manchester—because research by the Royal British Legion, which he has so strongly supported, has shown how deserving cases could be, and probably would be, disadvantaged by the new criteria. And it is the case in relation to the second amendment, which we shall discuss shortly—the excellent one put forward by my noble friend Lord Freyberg—because it would be parsimonious of the Government in the extreme if they were to go on brushing aside the plight of the most vulnerable post-retirement marriage widows.

Debates on these amendments in your Lordships' House, together with another one on unattributable pensions for life for existing widows, revealed how much concern, and indeed unfairness, still exists and needs to be addressed over these issues.

At the same time, I am very conscious that the new Bill, as drafted, gives current and future servicemen and women and their dependants a good pension deal—indeed, a much better one than the Ministry of Defence originally proposed. I am personally seriously worried that, even if further successful amendments in your Lordships' House were upheld in another place and then had to be renegotiated with the Treasury, not only would the Bill, already so long delayed and so urgently needed, be put back considerably but, bearing in mind the iniquitous cost-neutral aspect of the funding, it would lead to other important parts of the package suffering to the detriment of the Armed Forces as a whole.

So, after much thought, I now believe that the time has come to let the Bill go through with the support and blessing of your Lordships' House. If only Ministers would agree in all sincerity that once the Bill has received Royal Assent, these outstanding matters—especially the legacy issues—will be looked at again, considered and discussed, some of the principles of pensions for life having already been agreed, I for one would not wish to delay the Bill any further.

Photo of Lord Hodgson of Astley Abbotts Lord Hodgson of Astley Abbotts Shadow Minister, Economic Affairs, Shadow Minister, Home Affairs

My Lords, the noble Lord, Lord Morris of Manchester, hung his arguments for his amendment on two pegs: first, the change in the responsibility for proving the case from the MoD to the claimant; and, secondly, the change in the level of proof. I can get my mind around the second of those, recognising all the time the unique position of our servicemen and servicewomen.

I think that the Minister explained to us in previous debates the nature of what my noble friend Lord Astor referred to as "spurious" or falsely inflated claims. We have to recognise that we now live in a different age from that of 40, 50 or 60 years ago. We are more litigious and more disputatious, and I do not think we can expect that our Armed Forces, unique though their role is and unique though the dangers that they face are, will be immune from those changes in society. Therefore, I can understand why the Government have sought to proceed with the change in the level of proof.

However, I have much more difficulty with, and will be listening with great care to what the Minister has to say about, the other basis of the argument put forward by the noble Lord, Lord Morris. Here, I follow the noble and gallant Lord, Lord Craig, because this is about the individual versus the bureaucracy.

The switch from the bureaucracy to the individual seems to me to break one of the most important aspects of justice, which is—I hesitate to use this phrase in relation to the Armed Forces (Pensions and Compensation) Bill—equality of arms. As the noble and gallant Lord pointed out, we are dealing here with an individual serviceman or servicewoman who clearly believes that he or she is suffering, and in most cases will be suffering, mental or physical disability and is having to take on the might of the MoD. There is no equality of arms in that.

The predilection of a bureaucracy is to play for time and to spin out procedures—not so much for reasons of conspiracy but simply for reasons of administrative delay and because priorities are different. For the individual serviceman or servicewoman, this will be the most important thing in his or her life—it will be of critical importance. For the person at the MoD, it will be just another day at the office. That is why it will be so difficult for individuals to make their claim and why many of them, I fear, faced with this mountainous bureaucracy obstructing them, slowing things down, asking for more information and delaying hearings and so on, will simply say, "I can't face the continuing psychological effort required to press this claim", and they will abandon a perfectly legitimate and worthwhile claim.

When the Minister comes to reply, I shall want to hear him explain very clearly why my concerns will be met—that is, that there will be a very clear, sympathetic and easy way for the individual to move his claim forward. I do not think that I have yet heard that from the Minister, and I hope that he will be able to address it in his response to the amendment.

Photo of Lord Freyberg Lord Freyberg Crossbench

My Lords, I intervene in this debate because I wish to add my voice to that of the noble Lord, Lord Morris of Manchester, and others around the House on the heavy-handed manner that the Government have adopted in order to get their legislation through.

At a meeting held a few weeks ago with the Minister in another place to discuss my amendment on post-retirement marriages, I, too, was told that if I proceeded with it in any form, he would withdraw the entire Bill. It seems extraordinary that such threats are handed out when the purpose of my meeting was to look at the options available and to find out whether any were acceptable.

The issue at stake is whether the Government are prepared to listen to the arguments put forward in both Houses or whether we are expected to behave simply as rubber stamps. The noble Lord, Lord Morris of Manchester, has put a strong case, and I trust that the House will refuse to be intimidated by the Minister in the other place and, instead, will listen to the arguments for what they are.

Photo of Lord Boyce Lord Boyce Crossbench

My Lords, the eloquence of previous speakers means that I do not need to add to the debate. However, I become more concerned every day about the disillusionment of our Armed Forces with higher management in defence. If this amendment is not followed through, I believe that that will cause the disillusionment to deepen further.

I certainly also believe that it is wrong for the message to go out to them that we are being threatened with the withdrawal of the Bill if we do not withdraw the amendment. Perhaps the Minister would like to say in his response to the amendment how he will transmit the message to the Armed Forces that the amendment has been turned down. Will he use the words, "This is a fair result"?

Photo of Lord Bach Lord Bach Parliamentary Under-Secretary, Ministry of Defence, Parliamentary Under-Secretary (Ministry of Defence) (Procurement)

My Lords, first, I declare that I am an associate member of the Lutterworth and District Branch of the Royal British Legion. That is an interest that I am proud to declare. Secondly, I thank all noble Lords who have spoken with passion and great commitment. I am grateful to all of them for the tone of the debate.

The fact is that elected Members in another place have voted by a substantial majority to disagree with this House's Amendment No. 1 on the burden of proof for the compensation scheme and have provided a reason for that disagreement. I am grateful to my noble friend Lord Morris for altering his amendment and for the clarification of intent that that redrafting provides.

The House will not be surprised to hear that we propose to resist the amendment. The grounds for resistance are the same. It is quite right that this issue should have received such focus. It lies at the heart of the new compensation scheme. There has been a full debate on the burden and standard of proof at every stage of the Bill's passage. I shall not go into detail on the implications of the amendment again, as those were explained in another place.

As drafted now, the amendment seeks to introduce the war pensions scheme approach of applying the more generous standard and burden of proof to the new Armed Forces compensation scheme when considering whether an injury, illness or death was caused by service. It is a fact that the war pensions scheme burden and standard of proof mean that claims can succeed even when it is unlikely that service is the cause. I do not consider it reasonable to allow such arrangements to apply to a scheme for the future.

I remind noble Lords of the ways in which, during the passage of the Bill, we as government have sought to take on board legitimate concerns raised and have, where practical, sought to provide reassurance of our intention to promote a scheme that properly meets the special circumstances of military service. I have already announced the arrangements for the transitional period for the new pension scheme, when current serving personnel will not be able to make a choice of scheme, and, importantly, our commitment to include the new compensation scheme in the annual statement on veterans affairs made to the other place.

As the House has already heard, my honourable friend, the Veterans Minister, Ivor Caplin, met with the noble Lord, Lord Freyberg, to discuss his amendment. I quote from what my honourable friend said in another place on 20 October 2004:

"Last week, however, I had a constructive meeting with Lord Freyberg, and I indicated to him that we may be able to build on that meeting in future, when the Bill has received Royal Assent. I hope that, when that occurs, we can perhaps look at some of the other issues".

He later said:

"During my discussions with Lord Freyberg and the Forces Pension Society, I have indicated that we are prepared to continue to consider the matter".—[Hansard, Commons, 20/10/04; cols. 939-940.]

Further, the Veterans Minister is in active discussion with the Secretary General of the Royal British Legion, Brigadier Ian Townsend, about how officials might share the Royal British Legion's analysis of claims success rates under the new scheme. Indeed, my honourable friend and Brigadier Townsend met six days ago on Wednesday 27 October.

Throughout the process we have recognised the important role that the Royal British Legion plays in compensation issues, and remain committed to close working to achieve solutions that so far as practicable meet its concerns. I pay a genuine tribute to the Royal British Legion for all that it does and for the work that it has carried out in this particular area. I hope that noble Lords will recognise our willingness to resolve issues and engage in constructive discussions.

We have been asked many times before, as I have today, whether we could give examples of cases where the war pensions scheme has delivered decisions in terms of entitlement that should not be justifiable in an up-to-date scheme. In the past, and even today to some extent, we have been reluctant to do this, not because the evidence does not exist, but because we do not wish to imply that some current war pensioners were in some way undeserving.

I know that many, particularly of our older war pensioners, claim only reluctantly, and they should not feel that they are wrong to do so. They applied correctly under the rules as they are currently set out. Nonetheless, a change is now due if we are to produce a scheme that is focused properly on those whose injuries were likely to have been due to service, thereby freeing up resources to give greater help to the more severely disabled.

In this context, with the leave of the House, I shall give a couple of anonymous examples. The first is that of a 62 year-old ex-National Serviceman who claimed to have incurred a knee injury playing regimental football some 40 years ago. His service medical records had no note of the injury and post-service civilian medical records identified the onset of pain only in the previous two years. X-rays confirmed early arthritis in his knee. He also had some minor twinges in other joints. The claim was rejected by the Veterans Agency but overturned on appeal.

The second example is that many claims initiated by the widows of ex-servicemen rely on the fact that legislation allows war pensions awards if service in the Armed Forces caused or substantially hastened death. The concept of substantial hastening is not defined and awards have been made in cases of death at age 80 years and 90 years plus, more than half a century after leaving service. Some of those cases, involving death due to heart failure, have been linked to alleged minor sports injuries for which there is no documented link to service. They were said to have inhibited mobility leading to obesity, and ultimately to heart failure.

In those examples, which I am reluctant to bring before the House, I am not disputing that the claimants were suffering from a medical condition, or their entitlement under the scheme. I am simply suggesting that a cause other than service is far more likely to have been the cause of the condition or death. It is our belief that, given the choice between focusing the money available more effectively on the more severely disabled due to service who are poorly provided for under existing arrangements, or covering conditions which in all probability do not have a service cause, the former should benefit. We cannot afford to do both.

Let me say a brief word about costs. If we were to insert into the new compensation scheme a burden and standard of proof more generous than we have announced, such as that used by the war pensions scheme, that would be expensive. As the House has heard, our latest actuarial assessment is that the total cost would run to over £300 million over 10 years, with a continuing annual premium thereafter. To be clear, that sum is not a saving, as has been suggested in the past; it is an additional cost to the Government.

As I said, there is no saving as a result of changing the burden and standard of proof. Were we to accept the amendment, substantial additional money would be required over and above our broadly cost-neutral proposals. That is because we have taken the savings from the changed burden and standard of proof and used them to provide a better focus of benefits on the more severely disabled, a group who, as I have said, are badly served by current arrangements. The most obvious example of that is the award for the first time of cash lump sums for pain and suffering. For the most seriously disabled the lump sum could be up to £280,000—over 40 times the basic annual war pension paid for 100 per cent disablement.

Frankly, if opposition parties wish to press on with the amendment to introduce the burden and standard of proof, they need to make clear whether they would abandon the improvements for the more severely disabled, or whether they would be prepared to commit themselves to provide the additional funding required. We simply cannot begin to afford both to improve benefits for the more severely disabled and to maintain the current generous burden of proof within existing funds. Nor would it be right to do so. We are sure that the right decision must be to make better provision for the more severely disabled and not to pay benefits in an occupational scheme to cases where injury, illness or death is unlikely to have been caused by service.

It is important to recognise that no single element of the new pension and compensation schemes can be considered in isolation. The Bill provides for a long sought-after comprehensive package of new pension and compensation arrangements suitable for today's Armed Forces. These arrangements include provisions which represent very considerable improvements on the current schemes at a time when the wider pensions scene is one of reducing value of benefits.

The changes include very significantly improved widows' and widowers' pension benefits—a 25 per cent increase in the value of widows' pensions, and, as many of your Lordships have argued for many years, an increase in death-in-service benefit to four times pay from a maximum of one and a half times, which is a major step reflecting the particular risks of service life. And we have provided a much better focus of compensation benefits on the more severely disabled. Many of the improvements respond to concerns that have been voiced for years about the current arrangements.

However, I have to stress that in the Government's view the two new schemes can only proceed together; they support and complement each other in a balanced package designed to meet the needs of Armed Forces personnel and their families in the 21st century. I must remind the House that in this respect they have the full support of the present chiefs of staff. Significant changes to any area affecting either the coherence or the affordability of the schemes would inevitably cause us to look again at the overall package and mean that we were unable to progress with some or all of the improvements it currently contains. What is on offer is an overall package that redistributes resources and that better meets our manning needs and employer responsibilities. It is just not affordable to keep the generosity of the old and the best of the new.

I have to tell the House that if the amendment is passed, the Government's view—this is not a threat—is that the Bill would not be viable. It would mean that the Bill would fall and the improvements would be lost. I do not believe that that is what your Lordships want, the Armed Forces want, or the country wants.

I accept that the Royal British Legion has been flexible in recent months in offering alternative formulations of burden and standard of proof and I thank it for its assistance. However, the flexibility has not been all one way. We have made a number of changes to our proposals already to address the concerns of the Royal British Legion, and three in particular: first, an extended time limit for claims of five years instead of the three originally proposed; secondly, provision for exceptional review where deterioration of a condition is substantially greater than that which would normally be expected, and which was recognised in the original award; and, thirdly, agreement to report to Parliament annually on the scheme's operation.

In addition, and importantly, we will be consulting veterans' organisations on the detailed rules for the scheme before they are finalised, as set out in the draft statutory instrument. We are also willing to look with the Royal British Legion and other veterans' organisations at ways in which we can provide greater reassurance on the transparency and independence of the decision-making process, and provide greater support for claimants.

The noble Lord raised the issue of claimants. I can tell him that the Government have looked carefully at the legion's concerns that our proposal did not represent a fair balance of responsibilities between the claimant and the department. As I have explained before, our approach does not place the whole evidential burden on the claimant. The scheme rules will provide that the Secretary of State, or at appeal the Pensions Appeal Tribunal (PAT), will decide whether, on the basis of all the relevant evidence before them, it is more likely than not that the injury, illness or death is due to service. It will also include the claimant's service and medical records and any additional evidence obtained by the Secretary of State.

We do not intend that claiming under the new scheme should feel different for claimants. We consider that it would be unreasonable to require the claimant to obtain evidence relating to his claim. That could be from any source, including his official service records. The scheme rules will therefore impose a duty on the Secretary of State to make available such evidence on request. Of course claimants are free to submit evidence as they think fit.

There will be the right of appeal. The PAT will of course have regard to the entire body of evidence, whether provided by the claimant or by the Secretary of State. We believe that that will place a responsibility on the Secretary of State to provide a credible response to any substantial evidence submitted by the claimant.

Photo of Lord Hodgson of Astley Abbotts Lord Hodgson of Astley Abbotts Shadow Minister, Economic Affairs, Shadow Minister, Home Affairs

My Lords, I am grateful to the Minister for that very full response. Will the rules provide timescales? In other words, will there be rules to prevent the process being elongated? On the draft rules to be discussed with the veterans' organisations, will they require the MoD to reply within certain specified times?

Photo of Lord Bach Lord Bach Parliamentary Under-Secretary, Ministry of Defence, Parliamentary Under-Secretary (Ministry of Defence) (Procurement)

My Lords, I have not seen the draft rules. I am not in a position to be able to answer accurately. The draft rules will be open to discussion with veterans' organisations. If that is one of the points of concern, I am sure that it can be looked at very carefully. I am careful in the answer I give to the noble Lord, but I see no reason why that should not be looked at carefully.

MoD Ministers will take a close interest in the working of the scheme. Frankly, if it is not found to be delivering fair results, I can confirm to the House that the design of the arrangements will be reviewed. It remains our strongly held view that a beyond reasonable doubt standard of proof is not appropriate to a no-fault scheme and is out of line with current good practice. As I indicated in the examples, it delivers decisions that we believe can no longer be justified. We are confident that the revised statement of approach on this issue will ensure a fair division of responsibilites. Our work has indicated that no claim would fail where there is reasonable evidence of injury, ill health or death due to service.

I fully support the argument that we should recognise the unique and special contribution that our Armed Forces make by having a generous compensation scheme for injury or illness caused by service. It is important that we should concentrate our resources on cases where service is the likely cause and, in particular, focus our provision on the seriously disabled. That is what we are doing. The issue for the House this afternoon is whether, within existing funds, we should make improvements for the more seriously disabled or introduce the generous war pension scheme's standard and burden of proof.

We have no doubt that it is right to address the inadequate level of benefits for the more seriously disabled rather than extend benefits to those whose conditions are unlikely to have been caused by service. That is the choice the House has to make. The other place, the elected House, has made its views quite clear and on a point where affordability is, frankly, at the heart of the issue, I would ask noble Lords to accept this judgment.

Photo of Lord Astor of Hever Lord Astor of Hever Deputy Chief Whip, Whips, Shadow Minister, International Affairs

My Lords, the Minister mentioned a figure of £300 million over 10 years; that is £30 million a year. Does he agree that every page of the actuarial report he mentioned is riddled with uncertainties and caveats?

Photo of Lord Bach Lord Bach Parliamentary Under-Secretary, Ministry of Defence, Parliamentary Under-Secretary (Ministry of Defence) (Procurement)

My Lords, of course I accept that actuarial reports are actuarial reports. I do not expect them to be as final as the noble Lord seems to indicate. I do not think that I could agree with the way he has put the matter.

Photo of The Countess of Mar The Countess of Mar Crossbench

My Lords, does the Minister appreciate that by citing those two examples he is not demonstrating the wilfulness of former armed servicemen, he is demonstrating the weakness of the appeal system?

Photo of Lord Bach Lord Bach Parliamentary Under-Secretary, Ministry of Defence, Parliamentary Under-Secretary (Ministry of Defence) (Procurement)

My Lords, I am certainly not suggesting that anyone is being wilful at all. People are absolutely entitled to take account of the present scheme. That is their right and that is what those individuals did. I am telling the House that any scheme based on those principles cannot be right.

Photo of Viscount Slim Viscount Slim Crossbench

My Lords, before the noble Lord sits down, am I right in understanding that if the government measures are passed, he is prepared to have further talks with his honourable friend in another place, Mr Caplin, and the noble Lord, Lord Freyberg, to see whether there is some way forward? Would that include the pre-1973 position of widows who, as I have said, are on one-third of a miserable, miserly pension and will not be offered to buy in for half, or whatever? Will that come up in the discussion?

Photo of Lord Bach Lord Bach Parliamentary Under-Secretary, Ministry of Defence, Parliamentary Under-Secretary (Ministry of Defence) (Procurement)

My Lords, I am grateful to the noble Viscount. He will know that earlier in this House, the Government made a concession on pre-1973 widows—I know that he is referring to widows since that time. I cannot give him that guarantee. I can just repeat what my honourable friend Mr Caplin said in another place. He met the noble Lord, Lord Freyberg, and indicated to him that,

"we may be able to build on that meeting in future, when the Bill has received Royal Assent. I hope that, when that occurs, we can perhaps look at some of the other issues ... During my discussions with Lord Freyberg and the Forces Pension Society, I have indicated that we are prepared to continue to consider the matter".—[Hansard, Commons, 20/10/04; cols. 939-940.]

I want to be absolutely straight with the House: those are the words that were used in the other place and I know that Mr Caplin stands by them.

Photo of Lord Garden Lord Garden Liberal Democrat

My Lords, before the noble Lord sits down, will he return to where he talked about those reluctant claimants? Would he not expect that with a more difficult approach to the burden of proof, their reluctance will turn in to their not being claimants at all, although they have a proper case?

Photo of Lord Bach Lord Bach Parliamentary Under-Secretary, Ministry of Defence, Parliamentary Under-Secretary (Ministry of Defence) (Procurement)

My Lords, I do not think that that will follow. It is important that the rules are laid out. We really want those who received injury due to service to get what they are entitled to and to try to make it easier for them to come forward, rather than less easy. That is what we intend. I understand the point that the noble Lord makes, but we want servicemen injured in service to know their rights—perhaps to have them more clearly laid out to them than in the past—and it to be taken for granted that they will make a claim where such a claim is justified.

Photo of Baroness Strange Baroness Strange Crossbench

My Lords, before the noble Lord sits down, can he confirm his promise that if the Bill is passed, he will ensure that all pre-1973 war widows retain their pension for life?

Photo of Lord Bach Lord Bach Parliamentary Under-Secretary, Ministry of Defence, Parliamentary Under-Secretary (Ministry of Defence) (Procurement)

My Lords, the concession that we made earlier, which I think went halfway towards what the noble Baroness wanted, will stand, whether or not the Bill passes. I make that clear.

Photo of Lord Morris of Manchester Lord Morris of Manchester Labour

My Lords, I am grateful to all noble Lords who have spoken in the debate—including my noble friend—which has been one of high quality. He will not be surprised that I do not accept his submission to the House. The case that my noble friend cited of an ageing servicemen who claimed benefit for a soccer injury during his service is not only utterly remarkable but totally bizarre. To leave anyone with the impression that such a case is in any way common or even representative of an insignificant minority would be even more bizarre. What the ex-service community has asked for is examples of systematic abuse. The charge was that the war pensions scheme is now abused day after day at considerable cost to the taxpayer. The only example that we have now been given is the one that I have just cited which, as I said, is remarkable to the point of being totally bizarre.

The Prime Minister, the Chancellor and the Defence Secretary got it right in describing our Armed Forces as the best in the world. That is why they deserve the benefit of the doubt and an acceptable burden of proof. Parliamentarians have a compelling duty to ensure justice for those prepared to lay down their lives in our service and the dependants of those who do so. Indeed, we see that as our most compelling duty.

The clash this afternoon is not between Left and Right, but between right and wrong. Let us not be intimidated from doing what we believe to be right. I ask the House to approve the amendment.

On Question, Whether the said amendment shall be agreed to?

Their Lordships divided: Contents, 94; Not-Contents, 140.

Division number 1 Private Parking: Ports and Trading Estates — Armed Forces (Pensions and Compensation) Bill

Aye: 92 Members of the House of Lords

No: 138 Members of the House of Lords

Ayes: A-Z by last name

Tellers

Nos: A-Z by last name

Tellers

Resolved in the negative, and amendment disagreed to accordingly.

On Question, Motion agreed to.

:TITLE3:LORDS AMENDMENT

2 After Clause 6, Insert the following new clause—

"Post-retirement marriages

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."

The Commons disagree to this amendment for the following reason—

2A Because it would involve a charge on public funds, and the Commons do not offer any further reason, trusting that this reason may be deemed sufficient.

Photo of Baroness Crawley Baroness Crawley Government Whip, Baroness in Waiting (HM Household) (Whip)

My Lords, I beg to move that the House do not insist on its Amendment No. 2, to which the Commons have disagreed for their reason numbered 2A. For the convenience of the House, I propose to save my substantive remarks until I have heard what noble Lords have to say in this important debate.

Moved, That the House do not insist on its Amendment No. 2, to which the Commons have disagreed for their reason numbered 2A.—(Baroness Crawley.)

Photo of Lord Freyberg Lord Freyberg Crossbench

rose to move, as an amendment to the Motion that this House do not insist on its Amendment No. 2, to which the Commons have disagreed for their reason numbered 2A, at end insert "but do propose the following amendment in lieu thereof—

2C After Clause 6, Insert the following new clause—

"Post-retirement marriages

As of 6th April 2005 widows or widowers over the age of 75 of all service personnel shall receive a full widows' forces family pension based on their spouses' reckonable service and final salary, provided that their marriage took place before the service personnel's 60th birthday.""

Photo of Lord Freyberg Lord Freyberg Crossbench

My Lords, I beg to move Amendment No. 2B. In doing so, I cannot pretend that I am not disappointed that my previous amendment was not carried in another place, because it attempted to address a longstanding injustice. I wish to take this opportunity to thank the Member for Aldershot, Mr Gerald Howarth, for his valiant support of my amendment in another place.

However, as the issue continues to create hardship for elderly and vulnerable widows, and because there are so few mechanisms and opportunities for correcting past injustices of this kind, I believe that it is right that I should ask noble Lords to consider a new version of my original amendment, which I hope will prove more acceptable for reasons of cost. My new amendment would apply only to those now over 75; in other words, to the spouses of the Second World War generation. Consequently, it will cost no more than around £7 million, and not the £50 million estimated for the previous amendment.

In speaking to my amendment, it may be helpful if I give noble Lords a quick outline of the relevant points. Prior to 1978, service personnel who married after retirement were not entitled to pass on a pension to their widow, no matter how many years they had served. The armed services have a unique retirement structure, and, although such a lack of provision was not exceptional in pensions of the period, the difference in the military is that 70 per cent of those entitled to a pension were and are compulsorily retired at or around the age of 40. That is not the case in any other branch of the public services. It means that service personnel marrying between the ages of 40 and 60 were put at a unique disadvantage to those in the rest of the public service, whose normal retirement age was 60 or 65.

It is not that the widows of such marriages get a small, inadequate pension: widows of post-retirement marriages receive no pension at all. Their husbands' years of service count for nothing, although that is not the case for those who married under the age of 40, who can provide for their widow. Such widows are therefore at a disadvantage compared to their contemporaries in the military and compared to those in the public services in general. It is particularly harsh for widows whose first husband was in the forces but subsequently died who have then got remarried to a retired serviceman. They lose their first husband's pension on remarriage, and their second husband can pass on no pension at all. There are many instances in which it applies.

Why should those in the services who have already sacrificed so much family life, and regularly face situations of great personal danger, be expected to accept financial insecurity for their widow, just because they marry after the age of 40 but before the usual retirement age of 60? It seems only fair that the armed services should be on a similar footing to those in the rest of the public services and not be doubly penalised, having had a shorter career in the first place.

The amendment would allow a pension to a post-retirement widow, provided that the marriage had taken place before the serviceman or servicewoman was 60 and that they are now over 75 years old. The age of 60 is also the end of the age of recall liability for the Armed Forces, at which people can be called up for active service.

The Government have repeatedly stated that making a concession in this case would have severe read-across consequences in the rest of the public services. In fact, only the police and the fire service have a standard retirement age that is earlier than 60, and it is only five years earlier at 55. It is also worth remembering that those in the armed services are expected to live and work abroad for long periods. That is not the case for any other public servants. In other words, different conditions prevail in the armed services, so it is only fair that pension provision should take such factors into consideration.

I must also dispel, in the strongest terms, the grotesque scare figures—£300 million to £500 million—that have been bandied about as possible read-across for allowing all public service post-retirement marriages to qualify for pension benefits. That is one of the reasons why the age cap of 60 is in the amendment. I stress again that it is only the Armed Forces who oblige most of their personnel to retire at around 40. That is not the case in any other public service, and it seems a pity that the Government wish to confuse the matter by pretending otherwise.

One of the other issues that the Minister has raised repeatedly is retrospection. I am pleased to note that the Government have been willing to break their own rules on occasion, when they recognise an injustice. For example, only last month, during debate on the Civil Partnership Bill, the Parliamentary Under-Secretary of State at the Scotland Office, Mrs Anne McGuire, stated:

"The regulations will provide equality, as they will allow registered same-sex partners to accrue survivor pensions in public service schemes from 1988".—[Hansard, Commons, 12/10/04; col. 250.]

That is obvious retrospection, and I applaud the Government for their good sense in choosing to right a perceived injustice, rather than dogmatically applying an unequal rule. I urge them to take the same path and apply the same logic in this case.

I also reiterate the fact that I am asking not for preferential treatment for the Armed Forces but for parity. The Armed Forces are expected to face different pressures from those faced by people in any other walk of life, as we see daily in Iraq. It is cruel that the widows of those who married later in life should be singled out for harsher treatment and inferior pension provision.

Some might think that I have already had my opportunity to ask the Government to act on the issue. In ordinary circumstances, I might agree, but the circumstances surrounding the amendment are not ordinary. First, I know that the Labour Party is sympathetic in principle to the issue. It supported an even fuller amendment nine years ago, when the issue last came up in the House. Secondly, the nine-year gap has brought it home to me how few opportunities there are to raise such matters, while those affected continue to suffer the ill effects. This may be the last occasion to do something about the situation while many of those affected are still alive.

Finally, the ultimatum given by the Minister in another place has acted more as a provocation than a deterrent. His suggestion, which the Minister in this House read out today, that, if I were to drop the amendment, he might—I stress "might"—be able to address the matter at a later stage is no great encouragement for me to abandon it. The widows affected deserve more than potential consideration. If, however, the Minister here or the Minister in another place were prepared to go beyond a mere "might" and give an undertaking to help the widows outside the Bill, I would be happy to withdraw the amendment. If that is not possible, it is only right that this House should speak up for widows who have no other means of communicating their plight and who want only to receive the normal pension for their spouse's many years of service. I beg to move.

Moved, as an amendment to the Motion that the House do not insist on its Amendment No. 2, to which the Commons have disagreed for their reason numbered 2A, at end insert "but do propose Amendment No. 2C in lieu thereof".—(Lord Freyberg.)

Photo of Lord Fowler Lord Fowler Conservative

My Lords, I strongly support what the noble Lord has just said. This injustice has been ignored by governments of both parties; it is not remotely a party issue. In 1978 and 1987, there was some action, but the injustice to some of the oldest widows survives and continues.

One example that was given to me concerns an Army officer—divorced, as it happened—whose wife married again. He left the Army and only then remarried. He died prematurely, leaving a widow with two young children. His widow received nothing and had to struggle to bring up the two children. Just for the sake of completeness, his first wife did not receive anything either. That is not the way that we should behave to a widow, particularly after distinguished military service by a spouse. That widow is now in her early 80s. There is nothing that we can do to put right the injustice of the past, but we can make some recompense to her and other widows like her. That is what we should do, and it is the purpose of the amendment. Justice and fairness require such action.

The arguments used against this sensible course are twofold. First, the Government say, as they said in the previous debate, that it would breach their policy of non-retrospection. That is a nonsensical argument. About this time yesterday, we were debating with regard to the Pensions Bill an action of retrospection that was being introduced by the Government; that was the purpose of the debate that we had. One or two noble Lords present now were present for that debate. There has been no rule, as far as concerns retrospection, and that issue should not detain us too long.

The second reason—crucial and conclusive for governments—is cost. That is why this Government have not moved and why the previous government did not move. There is no other real reason. It is just a matter of judgment. I pay tribute to those who have drafted the amendment. The cost has been significantly reduced, and the extent of the application of the provision has been severely limited. We are talking about widows over the age of 75. I do not think that it is pushing generosity too far by Parliament and this House to act generously towards them. It is a matter of judgment, but I think that this country and this economy could afford to incur the modest cost involved. I very much hope that they will because, as it stands, the policy is indefensible.

Photo of Lord Astor of Hever Lord Astor of Hever Deputy Chief Whip, Whips, Shadow Minister, International Affairs

My Lords, I, too, support the amendment and pay tribute to the noble Lord, Lord Freyberg. When the Bill returned to the other place, we put down an amendment that all existing widows and widowers of post-retirement marriages over the age of 70 would be entitled to pension rights based on their spouse's service. Indeed, we made a commitment to supply that provision.

Photo of Lord Morris of Manchester Lord Morris of Manchester Labour

My Lords, as we have heard, my good friend the noble Lord, Lord Freyberg, was told by the Minister in another place that, if any amendment was approved by your Lordships on this issue today, even the extremely modest amendment he has just moved, with all his customary skill and concern, the Bill would fall. Does that still apply? Can we be told before this debate concludes whether it does?

Photo of Baroness Howe of Idlicote Baroness Howe of Idlicote Crossbench

My Lords, I wish also to support the amendment of my noble friend Lord Freyberg. As has been said, it really has been reshaped in a much more modest way. As we are near 11 November, it seems to be the right time and appropriate to redress this clear injustice. I would even name it indirect discrimination because the vast majority of widows and widowers are, in fact, affected. The case has been extremely well made. I very much hope that the Government, on reflection, will not just give an assurance but will agree to the amendment.

Photo of Lord Boyce Lord Boyce Crossbench

My Lords, we are in grave danger of repeating ourselves; the need for this is so obvious that it is inevitable. However, the new constraints drawn around the amendment mean that we are dealing with a very small number of people and a relatively small sum of money. It really would be invidious not to look after them, especially given that their pensions have been paid for by their spouses over time. Surely the Government must see that this is a reasonable thing to do.

Photo of Lord Redesdale Lord Redesdale Shadow Minister, Defence

My Lords, I am absolutely certain that the Minister will stand up and say—as she did many times in earlier stages—that she has to reject the amendment. But it has much merit: indeed, my name was attached to the amendment that went to the Commons. Perhaps I may commend the tenacity of the noble Lord, Lord Freyberg, on the way that he has pushed this issue—not just at this stage, but over a number of years—in this House. His argument has a great deal of merit.

The major problem that we face today is that the Government will say that they cannot accept this amendment because it will not be accepted in another place due to privilege. That, I believe, is a case which we cannot answer. Therefore, even if this amendment is passed, it will not be taken up by another place. However, as the noble Baroness, Lady Howe, pointed out, it is important that the Government understand that there is a great deal of feeling on this issue.

I was very moved by a letter that I received after the victory that this House imposed on the Government last time. A widow wrote saying that although she believed we would not be able to take the issue much further, she was heartened by the fact that for the first time in dealing with the MoD, it was not a matter that could be just brushed under the carpet.

The Minister implied to the noble Lord, Lord Freyberg, that something could be done outside the terms of the Bill. It would be helpful if he could convey the feelings that those widows have; that this is an issue that is not taken seriously by the MoD. Even if the Minister is unable to deal with it today, perhaps the noble Baroness may be able to say that something will be done in the future. I hope that she will not just use the privilege aspect and say that this can no longer be taken forward, but that the Government will do something positive.

Photo of Lord Vincent of Coleshill Lord Vincent of Coleshill Crossbench

My Lords, in the light of the very brief reason that was given in another place for the rejection of this amendment—namely, that,

"it would involve a charge on public funds"—

I should like to ask two questions relating to the precondition imposed at the outset of this Armed Forces pension review that the outcome should be "cost neutral".

My first question relates to the principles of equality and fairness on which a cost neutral condition was determined in the first place. I ask this because when the then proposed parliamentary pension scheme was debated in the other place shortly before its introduction, the question was raised as to how that very generous scheme was to be funded. The three-word answer recorded in Hansard states, "By the Exchequer".

Why then, in order to modernise important aspects of the Armed Forces Pension Scheme, including this proposed amendment and, not least, the death-in-service benefit where the parliamentary scheme is currently four times more generous, should the Armed Forces scheme now have to make compensating reductions or reject other amendments to pay for it when the parliamentary scheme costs fell entirely to the Exchequer?

My second question is more specific. Does the cost-neutral requirement of this review take account of the fact that between 1 April 1990 and 1 July 2004 the strength of the regular Armed Forces was reduced by one-third? Between the start of this review in 1998 and the implementation of the latest announced reductions that will be fully in effect by 2008, they will have fallen by 10 per cent. Should not the effect of those force reductions on reducing enormously the overall pension liability to the Armed Forces as they get smaller be permitted to count as a contribution towards cost neutrality?

On that basis, I would surely hope that we could cover the cost of this latest alternative amendment proposed by my noble friend Lord Freyberg.

Photo of The Earl of Erroll The Earl of Erroll Crossbench

My Lords, I want to add to the point about cost. I sat through part of the Pensions Bill yesterday. I cannot believe that we are arguing about a small amount of money to look after some war widows when yesterday there was a proposal that the Pensions Regulator should have non-contributory, index-linked, final salary pensions that can even be paid to non-executive directors, which is not normal elsewhere. I find it very difficult to understand how we could do that on the one hand and then, on the other hand, the next day cry "cost".

Photo of Lady Saltoun of Abernethy Lady Saltoun of Abernethy Crossbench

My Lords, I, too, pay tribute to my noble friend for his tenacity. He is a dog who does not let go of his bone very easily. We are continually told that one of the reasons for amalgamating regiments is that recruiting is so bad. When the Government treat the dependents of people who make a career in the Armed Forces in this way, what do they expect? People are not stupid. When people think about making a career in the Army, the Royal Navy or the Royal Air Force, they are bound to consider pension arrangements in the future. I do not think that this will help.

Photo of Viscount Slim Viscount Slim Crossbench

My Lords, I should very much like put on the record the attitude of almost "uncaring arrogance" of those in another place in matters like this and that they merely put at the bottom of the page that the Exchequer will not pay. I note, and I wish it noted, that in another place, quite often just lately—three or four times—they have improved their pensions and, particularly, what happens to their widows when they die: I see that they make clear that that is no burden on the Exchequer. Those in another place have a lot to answer for.

Photo of Baroness Crawley Baroness Crawley Government Whip, Baroness in Waiting (HM Household) (Whip) 5:00 pm, 2nd November 2004

My Lords, despite the many strong and passionately held views to the contrary that we have heard in this debate, I remain very clear that the House should agree with the Commons reason for disagreement with Lords Amendment No. 2. I repeat the words on the Marshalled List:

"Because it would involve a charge on public funds, and the Commons do not offer any further Reason, trusting that this reason may be deemed sufficient".

The reason makes it clear that the Commons disagree because of the additional cost of some £50 million to give the benefits described in the Lords amendment carried at Third Reading. The House is familiar with the arguments. I explained them in my speech in that debate. My noble friend has also given a clear explanation of why this figure would have to be paid by the Ministry of Defence to the Treasury. It would cover the years of service in the Armed Forces before post-retirement pensions were introduced in April 1978 for widows and October 1987 for widowers. I am afraid that there is no getting away from this additional charge, even if we were to make payments from a future date.

As the House knows well, we would expect this figure to rise to some £300 million to £500 million across government as a whole because the implications for other public service schemes would remain. It would not be possible to limit any concessions only to the Armed Forces.

My honourable friend in another place, the Minister for Veterans, told the Commons on 20 October about his constructive meeting with the noble Lord, Lord Freyberg. I understand that they agreed that it would be helpful to build on that meeting in the future, after the Bill has received Royal Assent. The Minister made it clear that he was prepared to give further consideration to this matter in those circumstances. I hope that, by restating that clarification, I am being helpful to noble Lords. However, obviously I cannot go beyond the words of my honourable friend, as the noble Lord, Lord Freyberg, has asked me.

I turn now to the further amendment proposed by the noble Lord, Lord Freyberg. The changes he has made, while reducing the cost of the proposal, do not have a material effect on the reason for disagreement. While it has not been possible in the time available to cost the amendment in any detail, the following points should be considered. First, the exclusion of unmarried partners brings no specific cost saving as we were unable to calculate the liability, given that we have no details of subsequent cohabitations. It did not form part of the £50 million figure. Secondly, while the amendment limits the age at which the improved benefits can be paid to age 75, in reality the age at which the majority of former service personnel might be expected to die and their widow's pension come into payment is in their seventies, so little is likely to be saved. For those widows or widowers below this age at the time of change, it will delay the payment of improved benefits until they reach this age, but the numbers affected are relatively small.

If carried, the amendments would impose an entirely arbitrary age limit, hedged about with qualifications which would not be defensible over time. It would, in short, be an untenable approach to legislation. To restrict benefits solely to those over the age of 70, while I am sure it is well intentioned, makes no sense at all in policy terms and would be at odds with our commitment to observe the principles of age discrimination legislation, where this is reasonable. For those reasons, I cannot agree with the noble Lord's amendment.

Photo of Viscount Bledisloe Viscount Bledisloe Crossbench

My Lords, my noble friend Lord Freyberg gave clear reasons why the position of the services was different from any part of the public sector. He pointed out, first, that service personnel have to retire at age 40 and, secondly, that many will have served much of their time overseas, and thus probably would have found it difficult to marry during that period. The noble Baroness has not dealt with those reasons; she has merely said that it is impossible to distinguish between service personnel and the other sectors. Will she honour the House with an explanation of why she has said that?

Photo of Baroness Crawley Baroness Crawley Government Whip, Baroness in Waiting (HM Household) (Whip)

My Lords, the Government do not agree with the noble Lord, Lord Freyberg, in his assertion that there would not be a read-across from this section of the public service to the rest of the public service. I am afraid that it is as simple as that.

I have been asked a number of questions which I shall do my best to answer. The noble Lord, Lord Freyberg, talked about the change in the terms of the amendment, reducing costs from £50 million to £7 million. I should say to him in reply that we do not have a precise figure for the saving that would result from the change in the wording of the amendment, but we are confident that that saving would be nowhere near as great as indicated by the noble Lord. That is because, as I pointed out in my earlier response, most of the widows concerned would not be widowed until their seventies and would be expected to live into their eighties. The major cost issue which we have just been talking about is the wider implication for the public service, where we expect the costs to run to several hundred million pounds.

The noble Lord also asked about the issue of retrospection, specifically in the context of concessions we made earlier in the passage of the Bill—addressing the issue raised by the noble Baroness, Lady Strange. That concession would affect only those who remarry in the future, not those who have already remarried. In that sense, therefore, we do not see this as retrospection. Moreover, in the matter of retrospection, we are following a position that has been established by many governments.

The noble and gallant Lord, Lord Vincent, asked about cost neutrality. I would say to him that it is not the case that the parliamentary scheme is simply a matter of the Exchequer picking up the bill. The parliamentary scheme is contributory, and the level of both contributions and pay take into account the value of the benefits offered under the scheme.

The noble and gallant Lord also asked me about reducing the numbers serving in the Armed Forces. The assessment of the costs of providing scheme benefits is based on an individual's entitlement, and cost neutrality relates to that. It is not sustainable to argue that reducing numbers would allow more valuable benefits. Moreover, wider defence costs would need to be taken into account when looking at the scheme.

I hope that I have covered the points made by noble Lords. For the reasons I have given, I cannot agree with the amendment tabled by the noble Lord, Lord Freyberg, and do agree with the Commons reason for disagreement.

Photo of Lord Morris of Manchester Lord Morris of Manchester Labour

My Lords, I am extremely grateful to my noble friend for the care with which she has explained her position. Can she answer my question: if the amendment of the noble Lord, Lord Freyberg, is carried, would it involve the dumping of the Bill? I understand from the noble Lord that he was told by a Minister in another place that acceptance here of his amendment would involve withdrawal of the Bill altogether. Is that still the case?

Photo of Baroness Crawley Baroness Crawley Government Whip, Baroness in Waiting (HM Household) (Whip)

My Lords, not having been privy to the discussions, I understand that that never was the case.

Photo of Lord Burnham Lord Burnham Conservative

My Lords, if cost is the reason why the amendment should not be accepted at the moment, why might things be different if further consideration is given to the issue after the Bill has received Royal Assent? What will have changed?

Photo of Baroness Crawley Baroness Crawley Government Whip, Baroness in Waiting (HM Household) (Whip)

My Lords, I can only repeat that a discussion has taken place between my honourable friend in another place and the noble Lord, Lord Freyberg. That discussion has been put on the record, both in this House and in another place. I cannot go beyond that discussion.

Photo of Lord Bramall Lord Bramall Crossbench

My Lords, am I right in thinking that, as this is a legacy issue, it does not have to be on the face of the main enabling Bill? Why cannot this matter be treated as a completely separate subject and the Bill go forward on its own and quite separately?

Photo of Baroness Crawley Baroness Crawley Government Whip, Baroness in Waiting (HM Household) (Whip)

My Lords, the noble and gallant Lord is right: the matter addressed by the amendment does not need to be in the Bill. I therefore refer noble Lords to the willingness of the Government to discuss these matters beyond the Bill.

Photo of Lord Freyberg Lord Freyberg Crossbench

My Lords, I thank all noble Lords who have spoken in support of the amendment today and the Minister for her consideration of this matter, whatever her views. I am sorry that she was unable to give a greater commitment than the one she has given from the Dispatch Box about looking at this subject outside the Bill. This issue has vexed me for some time and, because the Minister was unable to say more than he "might" look at it, I have felt compelled to bring forward the amendment today.

I feel that it is more important to right an injustice than to stick to a rule that was unfair when it was first made and has had an increasingly punitive effect ever since. I have made every effort to frame the amendment in a way that will cost the Government as little as possible. I know that there is a difficulty with costing because no figures are available. The figure of £7 million came to me from the Forces Pension Society, and that is all I can quote today.

In the week before Remembrance Sunday, I should like to remind the House that those affected by this issue are mostly widows of Second World War servicemen who fought for a pensionable length of time—for around two decades—and endured great hardship without being able to provide for their wives in the event of their death, through no fault of their own and in contrast to contemporary colleagues in less arduous positions. I hope the House will grasp this late opportunity to help such a vulnerable group. In those circumstances, I should like to test the opinion of the House.

On Question, Whether the said amendment shall be agreed to?

Their Lordships divided: Contents, 149; Not-Contents, 126.

Division number 2 Private Parking: Ports and Trading Estates — Armed Forces (Pensions and Compensation) Bill

Aye: 147 Members of the House of Lords

No: 124 Members of the House of Lords

Ayes: A-Z by last name

Tellers

Nos: A-Z by last name

Tellers

Resolved in the affirmative, and amendment agreed to accordingly.

Motion, as amended, agreed to.