Superannuation Bill

Baroness Turner of Camden Excerpts

Tuesday 26th October 2010 Lords Chamber

[Baroness Turner of Camden]

My Lords, I am unhappy about this Bill. I know, of course, that we do not oppose Second Reading in this House and I am not seeking to do that. However, I hope that the Bill will be substantially amended before it leaves us.

As the Explanatory Notes make clear, the object of the Bill is to cut payments to employees who are made redundant. It is being introduced in the wake of the spending review, when employees in the public service anxiously await news of the way in which their employment may be threatened or perhaps even terminated. In essence, as the Minister has explained, the Bill caps the amount of compensation paid to civil servants under the Civil Service Compensation Scheme to a maximum of 12 months for compulsory redundancies and 15 months for volunteers. It also removes the statutory requirement for the Government to have the agreement of the unions before decreasing any superannuation benefits.

I have been in touch with the Public and Commercial Services Union—one of the largest unions, with 300,000 members working across government departments. According to it, the Bill means that, in the event of redundancy, members working across the country will receive a vastly reduced compensation payment; some could even lose 50 per cent of the payments that they have accrued while working for the Government. According to the Explanatory Notes and to the statement made by the Minister this afternoon, an earlier attempt to amend the terms of the scheme was nullified when the union successfully brought judicial review proceedings.

I understand that there have been negotiations between the Minister and representatives of the PCS and the Prison Officers Association, the other large union involved, which has also objected to the main provisions of the Bill. An offer was made that was unacceptable, as the terms would have been detrimental to the majority of members earning more than £20,000 a year with accrued rights to two years’ service or more, although it is understood that more favourable provision was available for the very low paid. The legal advice that the union has received indicates that civil servants should continue to be entitled to accrued rights under the compensation scheme. The union states that it is anxious to secure a negotiated settlement. If no agreement is secured, the union would have to consider taking legal action, which could take many months to resolve. If the union were successful, as it could well be, the Government would be bound to adhere to the original entitlements.

As things stand, however, it looks as though the Government are intent on making many civil servants redundant without incurring the costs originally laid down as a result of collective bargaining. As a former union official, I find that unacceptable. What sort of message does that send out to many public service employees—many of them women—already worried about the future in the light of the spending review? “They want to get rid of us as cheaply as possible and they are going to tear up our agreements”, is what they will be saying—and that is the impression that will be created. The only way forward is a negotiated settlement with all the unions. As I said, we do not oppose Second Reading in this House, but we must seek to take this further in Committee.