Clause 8 - Commencement

Armed Forces – in a Public Bill Committee at 10:30 am on 24th February 2004.

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Question proposed, That the clause stand part of the Bill.

Photo of Mr Ivor Caplin Mr Ivor Caplin Parliamentary Under-Secretary, Ministry of Defence

With regard to the provisions set out in clauses 1, 2, 3 and 4, which we have dealt with in Committee, when I announced the details of the armed forces pensions scheme last September I said that we planned to introduce the new pensions scheme arrangements for new entrants on 6 April 2005. That remains our intention, subject to this legislative process. We are also planning to introduce the new

armed forces compensation scheme arrangements, covering all personnel, from that date as well. As indicated, those dates are subject to legislation.

Under clause 6, the Royal Patriotic Fund Corporation is now working with its professional advisers on the creation of a new charity, to be the transferee of its properties and liabilities. It is expected that the commencement order will be made at the earliest opportunity, once an appropriate transferee is established. As I said earlier, I will be happy to ensure that the House is informed about that.

Photo of Gerald Howarth Gerald Howarth Shadow Minister (Defence)

I do not want to delay the Committee on a two-line clause, particular as new clause 8 deals with the transitional arrangements, which are of concern to all hon. Members. However, consequences flow from what the Minister announced.

It is true that the Bill is simply enabling legislation. It has been confirmed to the Committee that the coming into force of the legislation has been fixed at 6 April 2005, but nothing in the Bill says when it is intended that it should come into force. We have only the Minister's word for it. The Minister is being ambitious in seeking to bring in pension arrangements in April next year. I should be grateful if he would give us some indication of how he reckons to organise their coming into effect.

On 7 April 2005, the Minister will be faced with those who have newly joined the armed forces, who will be subject to pension arrangements under the new scheme; but everyone else—about 200,000 other people—will be subject to the arrangements that apply under the present scheme. However, he will be in some difficulty at one point—it is not an insuperable difficulty, as it can be dealt with by fiat and ex gratia payments or similar means.

If we happen to be engaged in hostilities, it is unlikely that those who join on 6 April next year will be sent straight to the front line, but in three or four months' time they may be. A new recruit who is killed when on operations—or even if he was killed in a training accident, which could happen even sooner—would give rise to an attributable benefit. If two soldiers are injured or killed and one had just joined up and had no alternative but to come under the new system but the other was already a member of the armed forces and had not yet had the option to change to the new scheme, their widows would be eligible respectively for a one-and-a-half times salary death-in-service benefit or a four times salary death-in-service benefit. That will clearly give rise to substantial anomalies, which will be picked up by those who follow such things.

We shall go into the transitional arrangements in more detail later, but now that we know that 6 April 2005 is the decisive date, it would help if the Minister were to say how far he has proceeded in drawing up the rules and how much time he will give people to decide. That is not much of a problem for compensation, but it clearly is a problem for pensions. If he can give the Committee an early indication now, it would be helpful. After all the delays to the implementation of the new proposals, I do not complain that the Minister is trying to make progress swiftly. I have publicly

acknowledged that he has grasped the nettle on the matter, so I shall not chide him unduly for continuing at a pace. However, he will recognise that some practical issues must be addressed. It would be helpful if he could tell us how he plans to put the procedures in place in order to meet the commencement date that he has just cited.

Photo of Mr Ivor Caplin Mr Ivor Caplin Parliamentary Under-Secretary, Ministry of Defence

I am happy to try to do that. I shall not deny that it is a tight programme, both in terms of completing the passage of legislation—that may not happen until October—and of implementing the new pensions arrangements. I shall focus on the pensions arrangements, because the compensation arrangements apply to everyone.

On pensions, I should repeat that it is a new scheme for new entrants. There will be an opportunity for existing members of the armed forces to exercise a choice, and we are considering the new arrangements for personnel management, which will enable that choice to be made as easily as possible. Ultimately, individuals will decide what is best for them, with their families and partners. I am confident that we can achieve the timetable that we have set out. We are already undertaking a communications process; I do not know whether it was for my benefit, but when I was in the west country a few days ago, the leaflets advertising the pensions scheme were on everyone's desks. I am pleased that they are at least being distributed. We have a communications strategy in place. Obviously, we are holding back slightly because we want it to get through some part of the legislative process—although I am not pre-empting in any way the right of both Houses to have their say on the legislation, which I regard as an important part of the parliamentary process. I hope that the hon. Gentleman will forgive me if I do not go into too much detail, but I can reassure him on the points that he made. Perhaps we shall have a fuller debate on the matter under new clause 8.

Question put and agreed to.

Clause 8 ordered to stand part of the Bill.

Clause 9 ordered to stand part of the Bill.