Armed Forces Pay — [Steve McCabe in the Chair]

Part of the debate – in Westminster Hall at 3:00 pm on 14th September 2017.

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Photo of Stephen Morgan Stephen Morgan Labour, Portsmouth South 3:00 pm, 14th September 2017

I beg to move,

That this House
has considered armed forces pay.

It is a pleasure to serve under your chairmanship, Mr McCabe, and to have secured my first debate in Westminster Hall today, following my maiden speech in the main Chamber yesterday.

Portsmouth has a proud military history. It is one of the most famous ports in the world and our association with the Royal Navy continues to go from strength to strength. Our naval base is home to almost two thirds of the Navy’s surface ships and we have recently welcomed the new aircraft carrier, HMS Queen Elizabeth. We look forward to welcoming the second new carrier, HMS Prince of Wales, in the near future.

The Navy is an intrinsic part of my home city, its DNA and my own family’s history, and the naval dockyard is hugely significant to the local economy. A tenth of Portsmouth’s workforce is employed there, either in the armed forces or as part of the civilian workforce who support the Navy’s work there. I pay tribute to all their work, but for today’s debate I will focus on the work of our armed forces and specifically on their pay.

I called for this debate because our armed forces have been subject to years of pay restraint in the face of rising costs and increasing pressure on their incomes. This week, we have all seen the displeasure of public sector workers about the 1% pay cap as well as the hard work of their various unions in speaking out for them, which, hopefully, is now starting to effect real change. However, our armed forces do not have that voice; we have a responsibility in this place to be their voice. We have to speak out about their pay, pensions and working conditions if they are to see any improvements.

I will focus on three areas today: pay restraint; rising costs; and, finally, recruitment and retention. First, there is pay restraint. Like other public sector workers, members of our armed forces have been subject to pay restraint for several years. New figures from the House of Commons Library show that the starting salary of an Army private is now down 5.3% in real terms since 2010—a cut of more than £1,000 a year.

I suspect that the Minister will tell us that it is the Armed Forces Pay Review Body that makes recommendations for armed forces pay, and that the Government have accepted those recommendations. However, it is clear from the review body’s 2017 report that they are making recommendations with the constraint of the cap in mind. The report states that both the Chief Secretary to the Treasury and the Defence Secretary reinforced that approach in Government policy. The report even goes so far as highlighting the review body’s concern with the cap, saying that

“We commented last year that we were concerned about the sustainability of the current ongoing pay restraint policy, and that continues to be our view”.

I ask the Minister today whether similar constraints will be put on the review body when it makes recommendations in the future. If the Government decide to lift the public sector pay cap for our armed forces, will the review body be given a chance to produce an interim report so that new pay levels for our armed forces can come in as quickly as possible?

The second area that I will cover is rising costs. It is not just the case that pay is being restrained; it also comes at a time of rising costs for families across the UK, with some specific rising costs for forces’ families, which my constituents have raised with me personally. There is a new combined accommodation assessment model that uses new grading criteria, and it will see charges increase for about three quarters of service families accommodation occupants.

Armed forces personnel have also seen their national insurance contributions rise. Again, I refer to the pay review body’s 2017 report, which made the situation very clear:

“A common theme from our visits was that the one per cent basic pay award…was not perceived as an increase as it coincided with increases in National Insurance, changes in tax credits and…increases”— that is, other increases—

“that left a number of Service personnel seeing a reduction in take home pay.”

My third and final point is about recruitment and retention. Pay restraint is not only hurting our armed forces personnel in the pocket but it is clear that it is having an impact on the ability to recruit and retain personnel. When it comes to recruitment and retention, our armed forces are in crisis. All of our services are running at a liability of 5.1%. Figures released just today show that, for the first time and even by the Government’s new and questionable definition of “trained”, the Army has fallen below 82,000 in number. Its full-time “trained” strength is 81,920 and the numbers are trending downward.

That is nothing short of a broken manifesto commitment by the Conservatives. They promised us that they would keep Army numbers above 82,000. The Government now urgently need to take action, and although I recognise that dealing with pay will not solve all the existing problems, it is a good place to start. This year’s armed forces continuous attitude survey showed how unimpressed our services personnel are with their pay. Only 33% of respondents were satisfied with their basic rate of pay. By comparison, in 2010 satisfaction with pay was at 52%. Can the Minister identify what might have changed since 2010 to cause that 19% drop?

Among all those members of our armed forces who have put their notice in to leave, pay was the fifth most significant factor in making that decision. However, when we look just at “Other Ranks”, pay was the fourth most cited reason. Opportunities outside the armed forces also played a strong role in people’s decision to leave. The Army Pay Review Body’s latest report highlights that the review body has experienced this attitude at first hand, stating on page 53 that

“our visit programme made clear that Service personnel are becoming increasingly frustrated with public sector pay policy. They feel their pay is being unfairly constrained in a period when costs are rising, private sector earnings are starting to recover, and the high tempo demands on the Armed Forces have not diminished.”

The evidence is there: voluntary outflow is hugely high and recruitment is stagnant. If the Government do not get to grips with this problem soon, operational capability will start to diminish. Our armed forces are enormously professional and are respected around the world. They can do a lot with a little, but we have to be realistic: if we do not meet recruitment targets, they are not going to be able to do everything that we want them to.

So far, I have been disappointed with the Government’s responses to questions from my colleagues about recruitment targets. When asked for specific details about future targets, Ministers have responded with vague, single-sentence answers, such as:

“The Government is committed to maintaining the overall size of the Armed Forces”,

which the Minister for the Armed Forces recently wrote in response to the shadow Defence Secretary, my hon. Friend Nia Griffith. This makes me concerned that the Government are not taking this issue seriously.

In conclusion, I have recently returned—hot-foot—from the Defence Academy of the United Kingdom, where I saw at first hand some of the challenges that our armed forces face, and I want to put on the record my encouragement to any Member of Parliament to consider attending this useful scheme. However, some of those on the frontline have said to me that they now feel undervalued and unappreciated, and that morale is low. When I asked them what I personally could do as a new Member of Parliament, their feedback was, “Make sure the Government make us feel valued again”.

Given all his experience, the Minister will understand the severity of the current problems regarding the plans to lift the 1% pay cap for the armed forces. I hope that he will get to grips with that issue.