Public Disorder

John McDonnell Excerpts

Thursday 11th August 2011 Commons Chamber

[The Prime Minister]

I agree with my hon. Friend. As I said, we should test Government policy by whether it improves responsibility or undermines it.

[John McDonnell (Hayes and Harlington) (Lab)]

I regret the response that the Prime Minister gave to the hon. Member for Brighton, Pavilion (Caroline Lucas), but I thank him for the words of tribute that he paid to firefighters. As the secretary of the Fire Brigades Union parliamentary group, may I ask him whether the commitment that he has given to police authorities to stand by any additional costs applies to fire authorities as well? A thousand firefighter posts have been cut over the past year and there are real concerns about overstretch.

[The Prime Minister]

The point that I was making about the police is that they have to stand behind the Riot (Damages) Act. That is why it is important that the Home Office stands behind them. It is not an analogous situation to that of the fire brigade.

Public Confidence in the Media and Police

John McDonnell Excerpts

Wednesday 20th July 2011 Commons Chamber

[John McDonnell (Hayes and Harlington) (Lab)]

I shall be brief. I make a plea to put an item on the Leveson agenda. As a result of the work of the Prime Minister and the Leader of the Opposition, Leveson will be looking at the ethics of journalism. There have been calls in the House today and throughout the debate over the past three weeks for greater adherence to the Press Complaints Commission code of conduct.

The commission’s code of conduct is based on the National Union of Journalists code of conduct, which was first developed in 1936. Every NUJ member has to sign the code when they become a member of the union. It is policed by the ethics council, and there is an ethics hotline to advise journalists. The code includes the principle that a journalist

“strives to ensure that information disseminated is honestly conveyed, accurate and fair”.

Journalists must obtain their material

“by honest, straightforward and open means”

and do

“nothing to intrude into anybody’s private life, grief or distress unless justified by overriding consideration of the public interest”.

There is also a conscience clause in the code of conduct, which says that

“a journalist has the right to refuse an assignment or be identified as the author of an editorial that would break the letter or spirit of the code.”

Where the NUJ is organised, that code has worked.

Some Members will remember when, back in 2006, the Daily Star tried to produce a racist front page, but the workers, backed by their union and Members on both sides of the House, refused to publish it because of the damage it would do to community relations. The code of conduct did not work at News International because the NUJ was cleared out. News International used a loophole in the law. It set up the News International staff association, which was not certified as an independent union by the Government’s certification officer, yet it was still used to argue that there was a pre-existing union agreement, so the NUJ was not recognised. As a result, the journalists were not protected by a union.

We heard the description of the working atmosphere in Wapping—the bullying, the victimisation and the pressure put on journalists to produce material by whatever means. Someone described it as the development of a culture of sewer journalism. The House was warned. In 2004, when the Government were considering the last but one employment Bill, the NUJ briefed us all and urged us to introduce a conscience clause that would enable journalists to be protected when they refused to do anything against the code. That was rejected. I moved the amendment at the time, but it was rejected. The argument made by the previous Government was that it went

“too far in constraining employers.”—[Official Report, 29 March 2004; Vol. 419, c. 1364.]

It was opposed by Members on both sides of the House.

We were warned again by the NUJ, though. It came back in 2009 to present evidence to the Culture, Media and Sport Committee. It urged the Committee to reconsider the introduction of a conscience clause that would protect journalists standing up against bullying employers who sought to introduce work or material into their work that was against the code of conduct. The Committee ignored that evidence and request, however, and made no recommendation on it. I urge the Leveson inquiry to examine the introduction of a conscience clause backed by statute to protect journalists who refuse to go into the sewer and use the methods that we have all condemned in these recent debates.

[Julie Hilling (Bolton West) (Lab)]

Does my hon. Friend agree that the public largely believe what they read in the newspapers and what they see on the television and internet, and that one of the most important things that can come out of this whole sorry affair is a media that now tell the truth?

[John McDonnell]

I think that we will arrive at that situation only if we enforce the code of conduct and if journalists and employers know where they stand and that, if they breach the code, journalists can stand up and be protected in law if they refuse to practise the sort of journalism we have seen recently. The Leveson inquiry should consider anti-trade union legislation, which has been used to undermine employees’ rights at places such as News International when unions have tried to protect members who have simply stood up for quality and ethical journalism.

Public Bodies Bill [Lords]

John McDonnell Excerpts

Tuesday 12th July 2011 Commons Chamber

[John McDonnell (Hayes and Harlington) (Lab)]

We’re all Blairites now, are we?

[Alun Cairns]

I will give way to the hon. Gentleman if he wishes.

It is unlikely that Mr Blair and I would agree on the nature of reforms, but this legislation paves the way for Ministers to make necessary changes with appropriate scrutiny—without the delay that Mr Blair talked about—by giving them the mechanisms to do so. I am sure that hon. Members will have a soft spot for one or two of the bodies listed in the schedules, despite wanting to see the reform of such public bodies. We might even be drawn into trying to defend those institutions. Such an approach would be fair if schedule 7 of the original Bill remained and if the amendments made in the other place had not been accepted by Ministers. To give the Government credit, they have sought to listen to concerns and have accepted the threat that schedule 7 posed to lack of scrutiny. However, there must always be a balance between the Government having their way and the opportunity for appropriate scrutiny. The original schedule 7 did not necessarily achieve the equilibrium that we are looking for; I am pleased that it has been removed.

It is hard to believe that the quango state had grown to 901 bodies under the previous Administration. In their desire to manage controversies, a new agency would often be established to show that something was being done. Some might even argue that the agencies were useful bodies to which to retire former colleagues. The case for winding up or reorganising their numbers and purposes is overwhelming.

--- Later in debate ---

[John McDonnell (Hayes and Harlington) (Lab)]

I want briefly to make two simple but related points. Elected Governments—even unelected coalitions—have the right to determine the administrative arrangements they consider best suited to implementing their policies. However, there is such a thing as good governance. As the Public Administration Committee’s original report set out, good governance involves undertaking a proper review of structures, consulting the organisations and individuals involved, clarifying objectives and then having good, clear drafting of the legislation.

The hon. Member for Harwich and North Essex (Mr Jenkin) is not in his place, but I think that he hid his light behind a bushel, because last December’s PAC report was one of the most hard-hitting reports that I have ever seen in this House. It referred to the review process as “poorly managed”, and said that “no meaningful consultation” had been undertaken, that the criteria and tests set for the reform were “not clearly defined” and that the Bill was “badly drafted”, so it is no wonder it received a mauling in the House of Lords. In addition, the Committee said—I have never seen this sentence in a Select Committee report before—that the Government had

“failed to recognise the realities of the modern world.”

One element of that was the need for thorough consultation, a point that I want to discuss in relation to the staff.

Whatever the structures of government, whatever they determine those structures should be and whatever reforms to those structures they want to undertake, any Government will need an essential ingredient: well trained, professionally competent and motivated staff. However, in this Bill the staff are barely mentioned or considered, if at all. I chair the PCS trade union group, which involves Members of all parties in this House. The PCS has 30,000 members in non-departmental bodies, many thousands of whom are affected by this Bill. Many of those staff are facing compulsory redundancy, forced relocation, a deleterious impact on their terms and conditions and their pensions, an almost certain increase in their work loads and the end of job security—all in a situation of absolute uncertainty. The most common thing that I have heard from members of staff whom I have met in those bodies is that they are completely in the dark about their futures. There is a complete lack of clarity about what role their organisations and they as individual professionals will be playing, and they are worried about the future of the services that they deliver.

[Jon Trickett]

Will my hon. Friend confirm that redundancies are taking place now, before the Government have even taken these legal powers, which is damaging the capacity of those bodies to perform what continue to be their statutory duties?

[John McDonnell]

I can confirm that. Redundancies are taking place, and there is near chaos in some organisations, not only because of jobs being lost and redundancies being forced on people, but in the organisation of the services that they deliver. A number of staff are worried about the impact that the proposals will have on the users of their services. I refer in particular to those who manage the independent living fund and the 300 workers involved with the Youth Justice Board, whose jobs are likely to go. Morale is understandably at rock bottom in those services, so the important thing is consultation. However, I see that consultation with staff unions is not even listed in the Bill.

Also, there is an agreement stemming from the last Government—an agreement that I thought this Government had signed up to—on TUPE. The Cabinet Office statement of protocols adopted by the last Government and inherited by this Government, which I thought this Government had also signed up to, states that where TUPE does not apply—for example, in the transfer of staff into the public sector, which includes most of the bodies in this Bill—an explicit reference should be added to the Bill. That is the agreement that was signed up to, but all that this Bill contains is a reference in clause 24 to transferring people on conditions similar to TUPE. The legal advice provided to the union is blindingly obvious: conditions that are similar to TUPE are not TUPE. Therefore, a whole range of conditions of service and protections that staff now enjoy will be put at risk. I believe that this is an act of bad faith on the part of the Government. The least that they could do now is add TUPE to the Bill. It was included by the last Government in the Apprenticeships, Skills, Children and Learning Act 2009, and by this Government in the Localism Bill. In that way, staff gained some security for their futures.

Let me conclude. There is a view in many of those bodies that there is near chaos when it comes to what the future will hold for the staff and what the implications for delivering the service will be.

[Richard Harrington]

Assuming for a moment that the employment side of the Bill was altered as the hon. Gentleman suggests—actually, it will probably not be—would he then be satisfied with the new arrangements, or would he prefer the existing bodies to perform their functions as they are?

[John McDonnell]

The hon. Gentleman might not have heard me say earlier—I might not have made myself clear enough—that when a new Government are elected, they are perfectly entitled to introduce the administrative arrangements that they think appropriate for the implementation of their policies. There will be debate in the Chamber about the rights and wrongs of those administrative arrangements. As we have heard today, there are sharp differences of opinion between Members on either side of the House on the Youth Justice Board, the coroners service and the Commission for Equality and Human Rights.

There should, however, be one common feature across all parties, and that relates to the protection of the staff. They should not suffer as a result of the changing whims of Governments or of the changing directions of political parties’ policies. They should at least be afforded the opportunity of full consultation and of the legal protections that have been provided in the past, specifically through TUPE. I very much regret that there is no commitment to TUPE in the Bill. The commitment in clause 24 to something similar to TUPE will not give the staff the security that they need. Any Government, of whatever political hue, should have respect for the civil servants who serve them. On that basis, I urge the Government to think again about this issue.

The Cabinet Office Statement of Practice on Staff Transfers in the Public Sector—COSOP—principles were signed up to by the previous Government, and by this one, and they have been referred to at length in some of our debates. They are now being broken by the Bill. That has been interpreted by the trade unions as an act of bad faith, which is contributing to the present poor industrial relations climate in the public services. This is a critical issue. I welcome the opportunity for the PCS parliamentary group to meet Ministers to discuss how we can amend the legislation in Committee, so that when it comes back to the House on Report, we can debate the real principles behind the Bill, rather than being encumbered by this attack on the staff.

--- Later in debate ---

[Mr Hurd]

My hon. Friend’s question goes to the heart of the debate about how the Bill is structured. He understands that if this enabling Bill is enacted, it will be the responsibility of Ministers to come to this place with orders, having consulted where that remains appropriate, and make their case, with appropriate safeguards in terms of scrutiny and the capacity of the House to require the enhanced affirmative procedure. There was no serious discussion of this during the debate, but, with reference to the safeguarding procedures, I think we are in a much better place than when we started and when his Committee examined the Bill.

[John McDonnell]

On the point about process, because some aspects of the Bill are more contentious than others and the Government have moved from the affirmative procedure to the enhanced affirmative procedure, there may well be the opportunity on some issues to move to the super-affirmative procedure, which allows room for further amendment.

[Mr Hurd]

That has been considered and rejected. The enhanced affirmative procedure is considered to be adequate and proportionate. That seemed to be accepted by the other place.

I shall move on in order to give proper space for the other most contentious issue, which concerns S4C. Again, we heard powerful speeches from the hon. Member for Clwyd South (Susan Elan Jones), who is in her place, the hon. Members for Ceredigion (Mr Williams) and for Carmarthen East and Dinefwr (Jonathan Edwards), and from my hon. Friends the Members for Vale of Glamorgan (Alun Cairns), for Montgomeryshire (Glyn Davies) and for Aberconwy (Guto Bebb). My hon. Friend the Member for Montgomeryshire expressed the deep passions that the proposal has aroused. We heard from my hon. Friend the Member for Aberconwy that his office had been vandalised or attacked as a response to the Bill. My hon. Friend the Member for Montgomeryshire described S4C as the cultural backbone of Wales—a powerful phrase. The debate is about how we sustain S4C as an independent service that retains its own brand identity.

United Nations Security Council Resolution 1973

John McDonnell Excerpts

Monday 21st March 2011 Commons Chamber

[The Prime Minister]

The point that I would make is that this matter was discussed in the UN Security Council and the Chinese, Indians and Russians decided to abstain. Two of those countries have a veto and decided not to exercise it. Everyone was clear at the time about what was meant by enforcing a no-fly zone and taking all necessary measures to protect civilians. I will come on in my speech to describe how I believe what has happened is in no way disproportionate or unreasonable. Indeed, I would argue that it is absolutely in line with what the UN has agreed.

I will address specifically the amendment tabled by the hon. Member for Islington North (Jeremy Corbyn). I know that it has not been selected, but I want to ensure that we address everything in this debate. There is much in the amendment that I welcome. I assure the House that we will do everything we can to avoid civilian casualties. Indeed, last night our RAF pilots aborted their mission when they determined that there were civilians close to the identified military targets. I also agree with the hon. Members who signed the amendment about the need to avoid the use of depleted uranium and cluster munitions. We do not use those munitions. I welcome their support for those struggling for democracy and freedom in the region, and back their call to restart the middle east peace process.

However, I take issue with two crucial parts of the amendment. The first is the suggestion that there was somehow time for further consultation before undertaking military action. The United Nations gave Gaddafi an ultimatum and he completely ignored it. To those who say that we should wait and see, I say that we have waited and we have seen more than enough. The House is aware that the Cabinet met and agreed our approach on Friday. On Saturday morning, as I was travelling to the Paris summit, the Deputy Prime Minister chaired a meeting of Cobra. He was presented with a final analysis of the state of play on the ground in Libya and the advice was very clear. We were in a race against time to avoid the slaughter of civilians in Benghazi. All of us would have hoped to avoid the use of force, and that could have been achieved if Gaddafi had complied immediately and fully with the requirements of the resolution. The fact is that he did not. That left us with a choice either to use force, strictly in line with the resolution, or to back down and send a message to Gaddafi that he could go on brutalising his people. We should remember that this is the man who told the world that he would show the people of Benghazi no mercy. I am convinced that to act with others was the right decision.

[John McDonnell (Hayes and Harlington) (Lab)]

rose—

[The Prime Minister]

I give way to the other author of the amendment.

[John McDonnell]

I almost thought that the Prime Minister was about to support our amendment in total, but I live in hope on other matters. He made the specific point about avoiding the use of depleted uranium ordnance. Will he give a more categorical assurance that we will not use those weapons?

[The Prime Minister]

I could not have been more clear that we do not use those weapons and are not going to use those weapons.

Let me be clear with the hon. Gentleman about why, specifically, I do not agree with the amendment. My second objection is that it says we should “acknowledge” rather than “support” UN Security Council resolution 1973. I think that is profoundly wrong. It is an important resolution that the UK helped to bring about, and I believe that the House should be frank and clear in welcoming it.

--- Later in debate ---

[John McDonnell (Hayes and Harlington) (Lab)]

I found it touching that the hon. Member for Keighley (Kris Hopkins) and others expressed trepidation about entering a debate when we are sending troops into battle. I have been in the House for 14 years now, and I have done that on four occasions. I can tell them that it gets no easier. The more I have experience of conflicts and the more I understand the human suffering involved, the more I am committed to peace and conflict resolution, and the more I oppose such military interventions.

There comes a time in all such conflicts when the collateral damage—a disgraceful term—is reported to us, and evidence comes to light of families and children who get killed and maimed as a result of being in the wrong place at the wrong time. When coffins draped in the Union flag come back, all hon. Members will ask, “Did we do enough to avoid the conflict? Did we do enough to ensure peace?” That is why my hon. Friend the Member for Islington North (Jeremy Corbyn) and I tabled an amendment today. I appreciate that it was not selected for debate, Mr Deputy Speaker, but because it has been referred to, I should like to refer to it as well.

The amendment sought to demonstrate that we are using every means possible—straining every sinew—to gain peace, and not, as the Prime Minister set out, just doing that before the conflict. Often, the most successful peace talks are those that take place when military action has already been undertaken.

[Mike Gapes (Ilford South) (Lab/Co-op)]

My hon. Friend says that we should do everything we can to avoid conflict, but the conflict has already happened. The people of Benghazi are under attack, and the people of Tripoli are suffering from the Gaddafi regime’s repression. In that sense, standing out of the conflict is also taking a position.

[John McDonnell]

I am saying that we should secure peace now that the conflict has started. I oppose Britain’s involvement in the middle east because we have a century and a half of involvement—in pursuit of the region’s mineral wealth—that is steeped in blood, murder and maiming. We do not have the credibility to intervene constructively.

Nevertheless, the conflict has started, and our role is to secure peace as quickly as possible. That is why the amendment seeks to secure peace through negotiations. Already, there have been offers of mediation, in particular through the ALBA group of Latin American nations. We should take that offer. The amendment also states—

[Mr Deputy Speaker (Mr Nigel Evans)]

Order. Passing reference to the amendment is allowed, but we must not have a detailed debate on it.

[John McDonnell]

May I refer to those points to which the Prime Minister referred? He said that he would support the sentiments of the amendment, particularly in respect of ensuring that we keep civilians out of harm’s way. When I asked him about depleted uranium, he assured me that we do not use it, but we have used it consistently over time, and it has caused all sorts of harm to people in the middle east. This country, along with France, objected to the international ban on the use of such weapons, but I hope that the Prime Minister’s statement today means that we will now support the ban.

The Prime Minister said that he supports what we say about the need for a middle east conference. We need to engage to try to secure peace and stability and to promote democracy in the region. My view is that we need to do all we can to demonstrate our commitment to peace. The military action has already caused deaths. We do not know whether they are civilians, but the reports from Tripoli are that they are not dividing people from Gaddafi, but actually consolidating his support. The sight of the same countries that invaded Iraq killing Arabs again is of immense value to Gaddafi in his argument that this is another crusader invasion.

We have heard already that the Arab League is falling apart, with different statements coming out in different languages to hide the dissent. The UN is also dividing, with Russia and China, as we speak, urging that military action cease. They are not abstaining, but are convening the Security Council to try to end the action. NATO itself is displaying divisions as well. We have also heard statements from Turkey refusing to take on a longer term role. I have to say that statements in the House and by Ministers are increasingly confusing about the objectives of the military action. The UN resolution does not refer to regime change, but ministerial statement after ministerial statement clearly lead to that conclusion. Although the resolution states that there will not be a troop invasion or occupation, we now know that there is the potential for special forces and boots on the ground. That is all playing into Gaddafi’s hands by calling up images of a foreign invasion.

The charges of hypocrisy cannot go away. There is the lack of action in Yemen, Bahrain and Oman. I am talking not about physical action, which I would oppose anyway, but about the mealy-mouthed ministerial statements. There has been no threat to use the international courts against these killer regimes or to seize their assets, and there has been no threat even of diplomatic isolation. Neither has it helped that the images are still fresh in people’s minds in the middle east of our Prime Minister’s recent tour of the region to sell arms to these barbaric regimes. Finally, of course, my hon. Friend the Member for Islington North has mentioned the hypocrisy of refusing a no-fly zone when Gaza was invaded. We now face the prospect of a long-haul engagement in military action in Libya.

We risk being dragged into on-the-ground bloody combat, followed by a counter-insurgency struggle and then vulnerability to a lengthy terrorist campaign. It will all threaten the peace and stability of the region and have consequences for our own people and the global economy. That is why the message today from the Chamber should be that we seek peace, that we want to ensure the safety of civilians and that our concern is for the peace of the region and the promotion of democracy overall. I urge the Government to take up the offer of mediation from the ALBA countries. I urge the Chamber to send the message that we strive in every way possible to bring all parties together to seek peace. In that way, we might yet have the opportunity to restore some credibility to the role of this country in the middle east. I do not believe that that will be done as a result of the bombs and missiles now hurtling down on the Libyan people and causing death and destruction.

[Mr Allen]

On a point of order, Mr Deputy Speaker. Will you speak to Mr Speaker to ensure that the rights of the House are properly represented, so that in future, when a motion is put down by the Government, who are meant to be being held to account by the House, sufficient time is allowed for amendments to be organised and tabled by people in the House of a different view? We all have reservations. No one has spoken tonight and said that they are 100% certain about what we are doing. If we allow other voices and amendments, and if we allow colleagues to accumulate sufficient signatures, would it not be in order to have a debate with amendments that could be voted on and which could present a different point of view in the House from the choice we are presented with tonight?

UN Security Council Resolution (Libya)

John McDonnell Excerpts

Friday 18th March 2011 Commons Chamber

[John McDonnell (Hayes and Harlington) (Lab)]

I support the freedom struggle of the Libyan people and I am a supporter of the United Nations, but I have grave concerns about the use of force by western powers in this region, and both the short-term and long-term consequences. It therefore behoves us to ask the question: what next? In the short-term, in the interests of conflict resolution, is there to be a final offer from the United Nations to Gaddafi for peace talks? If armed conflict goes ahead, what measures are being put in place to ensure the safety of civilians? In particular, may I urge the Prime Minister that there should be no use of depleted uranium weapons, which have damaged the long-term safety of the civilians in Iraq? Given the change of regimes that has taken place in this region, given what is happening in Bahrain and given the continued oppression of the Palestinian people, may I urge him to go to the United Nations and say that now is the opportune time to re-establish a middle eastern conference that looks at the long-term security and peace of this region?

[The Prime Minister]

I thank the hon. Gentleman for his question. What the UN is suggesting is very clear. Paragraph 1

“Demands the immediate establishment of a cease-fire and a complete end to violence and all attacks against, and abuses of, civilians”.

Paragraph 2

“Stresses the need to intensify efforts to find a solution to the crisis which responds to the legitimate demands of the Libyan people”.

The point that I would make to the hon. Gentleman is this: if we make this statement and give this ultimatum, and in a way, the UN has given this ultimatum; if Gaddafi does not respond and goes on brutalising his people; and if in those circumstances we say that we are not prepared to use force to protect civilians, with all the backing of the UN, with all the backing of international law, with the Arab League behind us and with the world saying that this is right—if not then, when?

The hon. Gentleman does need to think about this, because although there should, of course, be all sorts of things holding you back before you take action, and there are all the questions you should ask, when there is this degree of international backing, and if Gaddafi will not stop the brutalising of civilians, there is a complete legitimisation of taking action to protect those civilians.

Superannuation Bill

John McDonnell Excerpts

Tuesday 14th December 2010 Commons Chamber

[John Hemming (Birmingham, Yardley) (LD)]

It is rather sad that, again, there are relatively few people in the Gallery when we are debating such an important issue. We need to value the work of people who work for society and all our public servants. Obviously the terms of the civil service compensation scheme do not affect those in the NHS or local authorities, who have varied schemes that are often much worse than even the proposed new terms of the civil service scheme.

This is an important matter, and I am pleased to support the Lords amendments. They make it very clear that we will be bound by good practice and enter into proper and meaningful consultations, with a view to coming to an agreement. Although one particular trade union may continue to try to veto the scheme, that does not mean that we should ignore the need to try to obtain an agreement using a reasonable approach. I am very pleased with the Government’s strategy of protecting people on lower incomes. That is an excellent thing to do, so I am pleased to support the Lords amendments.

[John McDonnell (Hayes and Harlington) (Lab)]

Lords amendment 1 requires the Government to consult with the aim of seeking agreement, and provides for a report to Parliament in due course. Lords amendments 2 and 3 will bring the Bill into force two months after Royal Assent and I find it extraordinary that the Government see that as some form of concession, because the bulk of the staff who will be made redundant in the coming period will be made redundant under a scheme that is still to be imposed. The Government intend that that scheme will be introduced within the two months after Royal Assent, so there will be no report to Parliament, no commitment to consultation and no commitment to take steps to reach agreement, as is embedded in Lords amendment 1. The terms of the scheme, as they stand in the original proposals in the Bill, will be imposed. So although Lords amendment 1 proposes a system whereby there is at least some commitment to parliamentary scrutiny of the willingness and commitment of the Government to negotiate and seek an agreed settlement, Lords amendments 2 and 3 take away that commitment, because we know that the scheme will be amended within the two months to which Lords amendment 1 does not apply.

I cannot think of a better mechanism to incite industrial action. It could be construed as an act of contorted bad faith. Although there have been commitments in ministerial written statements, there has been no commitment to adhere to Lords amendment 1, because it would not otherwise be virtually vetoed by Lords amendments 2 and 3. In my view, that will not only result in industrial relations deteriorating but enhance the potential for legal challenges. It certainly will not enhance the legal protections for which the Government were hoping as a result of the amendments.

The amendments do not address the problematic core of the Bill, which is the imposition of caps and limits on the compensation scheme without the agreement of the unions representing the members affected. I have heard a lot about the four out of the six unions agreeing or recommending the scheme that is being imposed. I remind the House, however, that of the two main unions that represent the vast bulk—more than 75%—of the members affected, one, PCS, or the Public and Commercial Services Union, has not agreed the scheme and is recommending that its members reject it in the ballot; the executive of the other, the POA, has recommended that its members reject the scheme in the ballot, too.

I find it an absolute irony that in any future negotiations, which will, I suppose, probably be relatively minor because the Government will impose the bulk of the change in the next couple of months, the House will have some form of scrutiny of the negotiations as a result of Lords amendment 1, but it will not be able to exercise it in those two months. The reason for that is that if there was a full exposure of what went on in the negotiations, it would provoke even more anger among PCS and POA members.

This has been the worst example of industrial relations practice that we have seen in years. First, there was the use of a “blunt instrument”—I use the Government’s own words—of the threat of a Bill’s being brought forward to impose such severe caps that many would have lost more than two thirds of the redundancy payments that they had acquired as accrued rights over the years. There was then an extremely crude attempt to divide and rule the unions. I believe that the POA is seeking some form of legal redress against the Minister for the Cabinet Office for some of his statements. Those practices have now resulted in the virtual chaotic breakdown of the formal negotiating structures that have held good under past Governments throughout the decades.

If Lords amendment 1 comes into force, at least there will be some reflection of the negotiations that took place—and it might be more accurate. As the Minister has dwelt on the process of the negotiations, perhaps I might put on the record an alternative historical account of what occurred. Yes, the civil service unions—all six of them—sought to negotiate some form of agreed settlement throughout the summer. They did that in the light of the threat of the imposition of a Bill that would cut significantly their members’ redundancy payments.

In September, the Treasury intervened to insist on a cash cap on the new scheme, so there was no room to manoeuvre to improve the scheme beyond that cap. I believe that that significantly undermined the potential for a settlement. On 28 September, the Minister declared that he was pursuing agreement with five of the unions, excluding the PCS, and on 4 October a formal offer was submitted. On 11 October, PCS and the POA held a constructive meeting with the Minister, focusing on the cap on redundancy proposals and making proposals to redistribute from high earners to the vast majority of civil servants, enhancing the protection for the majority.

[Mr Maude]

The hon. Gentleman refers to a report of that meeting, but I can give him another account, because I was there—it was my meeting. No concrete proposals were made at that stage, and certainly not proposals that could in any way remotely or realistically redistribute benefits away from higher earners, whose payments are anyway capped under the scheme that we have agreed, towards the lower paid and particularly the lowest paid, who are much better protected now than they were under the previous Labour Government’s scheme of last February.

[John McDonnell]

My understanding is that on 11 October, PCS and POA tried to explore with the Minister opportunities to make the scheme fairer and more just for their members, and to set out certain parameters in which negotiations could take place. The PCS executive was scheduled to meet on 26 October to consider the next steps in its negotiations with the Government, but on 25 October it received a letter from the Minister, who told them that negotiations had been concluded and that he would implement the proposals that he set out on 4 October. I do not consider that an appropriate way to seek agreement.

As a result, PCS wrote to the Minister on 26 October to say that it was willing to submit proposals. He welcomed that offer and confirmed he would reopen talks if proposals came from the Council of Civil Service Unions, which is exactly what the PCS did—it submitted the parameters and proposals via the CCSU in a constructive approach to reach agreement. The Cabinet Office made no attempt to go into any detail on those proposals or to cost them, and on 9 November, the CCSU submitted terms to open the detail of talks with the Minister, who must have been aware of the background to that letter and of the detail of the PCS proposals. However, on 15 November, he said that the window for talks was closed. Although PCS sent a further letter on 16 November, it was informed that there would be no future talks.

That is a different historical account of those negotiations. The unions, which represented the vast majority of their members, were open to continuing talks to reach an agreed settlement. If amendment 1 had been in place before those talks, the House might have had a more objective historical account of the negotiations than the Minister or I have given—at least we would have had the opportunity of receiving a full report. However, the Minister’s amendments have denied us the opportunity of a report on those negotiations and allow a report only of future negotiations. That is extremely disappointing. It is another act that will undermine civil servants’ confidence that they are being treated fairly by the Government at this critical time in their lives—we are told that 360,000 of them will lose their jobs because of the comprehensive spending review and subsequently.

In addition to souring the industrial relations climate, the Government have opened up a vista of legal challenges—under article 11 of the European convention on human rights and article 1, protocol 1—which has occurred before. Amendment 1 is the Government’s attempt to find legal cover for their infringement of those articles, particularly article 11, but it does not go far enough. In fact, amendments 2 and 3 take away that cover completely in respect of the current negotiations. The Government’s proposals are legally precarious to say the least. I am sure that there will be a legal challenge from PCS. I believe that it will be successful.

In the previous Government’s negotiations, PCS threatened legal challenge, and it was advised by civil servants—they met us a week before the general election was declared—that the Government were confident of winning in court. The same civil servants advise this Government of the same thing. They were wrong before the election, and I believe that they are wrong now. In fact, PCS is yet to lose a case against the Government. We have the prospect of tens or perhaps hundreds of thousands of civil servants being made redundant. If the Government’s proposals are overturned, the civil servants who are made redundant under the imposed scheme could seek legal redress and compensation, which could run into many millions of pounds.

--- Later in debate ---

[Mr Maude]

The right hon. Gentleman raises a good point, which is that it is by no means true that all civil servants belong to a trade union. The figures show that something in the region of 60% of civil servants belong to a trade union, but many are unrepresented. I am not sure that the Superannuation Act 1972 or what we are proposing in the Bill makes requisite any particular form of consultation with those who are unrepresented. However, he raises a good point that those who engage in future consultations should be alive to.

The hon. Member for Hayes and Harlington referred to his concern that, because the consultation requirement will not be commenced for two months, there will somehow be no obligation to consult. There has been extensive consultation. He raised concerns about the proposals that he claims were made by PCS and the POA, but the outline suggestions that eventually emerged from PCS, if implemented within the cost envelope, which I have always said exists and which would have existed under whichever Government were in power, would have had the effect of reducing the compensation available to those over pensionable age—that is, those over 50 and approaching retirement—and reducing the benefits available to the lowest paid. I say again that our primary concern has been to ensure that there is proper additional protection for those who are lower paid.

[John McDonnell]

I am sure that the right hon. Gentleman would not want inadvertently to mislead the House. Just for the record, that is contested by the unions themselves, because it was open to the discussions that the union was hoping to pursue with him, but which he declined.

[Mr Maude]

The concern raised by the unions at the time was that there was insufficient compensation in the scheme that we were developing with the other unions for those who were above the £23,000 salary underpin. We could have increased the compensation payments for them only by taking away from others. The only ways in which that could have been achieved—these suggestions were canvassed—would have been by lowering the £23,000 underpin so that all those earning less than that would have been penalised, or by taking away the significant protection that rightly continues to exist for those over 50. I recognise that someone who started work as a civil servant as a teenager straight after leaving school, and who has worked as nothing else until leaving the civil service in their 50s, might not find themselves in a fantastic place in the labour market. It is therefore right that there should be proper protection for people in those circumstances. That is why protecting those approaching retirement and the lowest paid people in the civil service was an absolute priority for us. I believe that the scheme that we have put in place meets those commitments and priorities.

--- Later in debate ---

[Mr Maude]

It is really hard to do that, because, as I pointed out in the letter that I sent to all Members, there were only outline suggestions made by PCS. Back in September, five of the unions—the five not including PCS—wrote to me with some proposals that they had signed up to, and that PCS had declined to sign up to. At their request, we entered into discussions with the five unions, and the ensuing proposals formed the basis of the new scheme that we have developed. They are not totally reflected in the scheme, but they formed the basis for it. I constantly and consistently urged PCS to join that process and to make concrete proposals, but it had declined to sign the letter that the other five unions had signed, despite being asked to do so by the five unions.

That protracted process involved meetings with Mark Serwotka of PCS and Steve Gillan of the POA, at which I urged them to make concrete proposals that would enable us to work towards a full agreement. All that emerged, however, after protracted delays, were outline suggestions. When asked how any additional protection for higher-paid people—not highly paid people, but those above the £23,000 underpin—was to be paid for, the only suggestions were either to lower the underpin, which would have meant that all lower-paid workers would have been penalised, or to reduce the protection available to those over 50. We were not willing to do that because providing protection was a priority for us.

[John McDonnell]

Following on from an earlier point, the Minister will know better than most of us that these negotiations are complex. He has said that it was difficult at times to calculate the overall consequences. That is why the Public and Commercial Services Union—through the Council of Civil Service Unions as the Minister requested—put forward outline proposals for detailed negotiations with staff. However, the Minister for the Cabinet Office then closed the window for those negotiations, just as they were becoming productive. There are complexities and if the Minister objected to issues like that, those points could have been taken up in the next round of negotiations.

[Mr Maude]

I have to take issue with the hon. Gentleman’s phrase about the process just beginning to become productive, because it was not. The outline suggestions were vague and the only way of paying for them would have been by taking money away from lower-paid workers or people approaching retirement. We explored whether there was any other source from which those funds could be redistributed, but it turned out that there were no alternatives.

[John McDonnell]

If that is the right hon. Gentleman’s only concern and his only objection to the position of PCS, supported by the POA, why can he not simply reopen negotiations now to resolve the matter?

[Mr Maude]

The hon. Gentleman talks as if this were a trifling consideration, but it is not. This process has been going on for three years. If the Bill goes through the remainder of its stages and on to the statute book, the new scheme that I hope to lay before Parliament before we rise for the Christmas recess, superseding the current scheme, will have been the product of many months—indeed, years—of protracted discussions. I know that he disagrees, but I have to say that despite repeated requests, the PCS has been tardy, to say the least, in coming forward with proposals and has, at best, made outline suggestions but never concrete proposals that could have formed the basis of an agreement. The other five unions did, and I am grateful to them for their engagement, which enabled us to forge a new scheme—as I said, we hope to lay it before Parliament next week—that will provide a fair balance between the interests of taxpayers and the interests of civil servants and protect those approaching retirement and the lowest paid.

[John McDonnell]

I am grateful to the Minister for giving way. Let me quote to him his statement to the House on 30 October, when he gave a commitment that he would “strain every sinew” to achieve a negotiated settlement. What I am suggesting is that, if he has identified an issue as an impediment to a negotiated settlement, he should now adhere to his commitment to strain every sinew and meet the unions again. It is no use repeating over and over again the fact that five out of six unions have agreed a settlement. They have not. The two unions that represent the vast majority of members have rejected the Minister’s proposals. Surely it behoves him now to go the extra mile and strain that extra sinew to seek a negotiated settlement before he provokes industrial action or legal challenge.

[Mr Maude]

Those are not concerns that have just arisen; they have been there throughout. I have been forthright in ventilating them with the leadership of the PCS and POA, and they know that. We have been clear about the envelope within which it would be possible to make changes because increasing protection for one group can be done only at the expense of other groups. There is no way around that. That is the basis on which we have formulated the new scheme, which I hope to lay before Parliament before the Christmas recess. That is the basis of my case.

--- Later in debate ---

[Mr Maude]

The amendments respond to concerns raised by Opposition Members on Second Reading in the other place about the potential for the caps in what is now clause 2 to be revived after being put into abeyance, which is what I propose to do next week before the House rises and before the new scheme is laid. The Government also proposed the amendments to respond to the comments about the unusual use of a sunrise provision in clause 3(4)(c) that were made in the third report of the House of Lords Delegated Powers and Regulatory Reform Committee, published on 28 October. My noble Friend Lord Wallace of Saltaire provided a full response to the Committee in his letter of 1 December. We are grateful to the Committee for its report.

The Committee also commented on the other provisions in clause 3 which would enable, by order, the caps included in clause 2 to be repealed and also to be extended by six months at a time. That would override the so-called sunset provision in clause 3(3), which would otherwise mean that the caps on civil service compensation provided in clause 2 would expire automatically after 12 months. The Committee said that “these arrangements are complex”, but added that the two delegated powers

“do not appear to the Committee to be inappropriate”.

However, the Committee was not so persuaded of the need for the power in clause 3 to revive the caps in clause 2, that being an unlimited power that would have been available to any future Government in circumstances that we cannot predict today. The amendments respond to that point. The Government accept that there should not be an unlimited power to revive clause 2. Lords amendment 6 therefore provides for subsection 3(4)(c) itself to expire three years after Royal Assent, which is in effect a sunset of the sunrise provision. I can see why some people might say that that was a bit complex, but I think that, when fully parsed, it makes perfectly good sense.

The sunset of the power to revive clause 2 would mean that it would be there, as the Government intend, as a fallback to revive the caps in clause 2, just in case they were needed because of future problems in implementing the new civil service compensation scheme. However, the introduction of the three-year time limit should provide a reassurance that the power to revive clause 2 would not be available indefinitely to future Governments.

The caps are there as a potential fall-back so that we can be certain—as both the last Government and we have wanted to be—that we can reform the civil service compensation scheme. We have an absolute obligation, in the public interest, to address the unfair and unaffordable nature of the current scheme, and we need to ensure that if a legal challenge is mounted to our revised scheme—and it has been suggested that that may well happen—there is a fall-back option, albeit one that we have absolutely no desire to use. We do not expect or intend to use the powers to impose the caps in clause 2; what we want is to see in operation as quickly as possible is the reformed civil service compensation scheme. We are determined that, if all else fails, there will be a fall-back position so that we are not left high and dry—as the last Government were—because of a legal challenge to the details of the new scheme.

Before the new scheme is laid before Parliament, I intend an order to be made under clause 3(4)(a) to repeal the caps in clause 2 in relation to any new scheme. We intend the order to include a saving provision so that the caps could be applied if, and only if, the old unreformed scheme had to be reintroduced. The saving provision would allow that to happen automatically, without the need to use the revival power by order under clause 3(4)(c). I should make it clear that this saving provision would apply only if there were an attempt to revert to the old scheme. An order under clause 3(4)(c) would be required, subject to the affirmative procedure, if it were ever proposed to revive the caps in clause 2 and to impose them over the new civil service compensation scheme that will be put in place following the completion of this Bill’s passage.

Finally, unless further extended by order under clause 3(4)(b), clause 2 in its entirety—including the saving provision—will expire 12 months after Royal Assent. From that point on, any revival of the caps would have to use the order-making power in clause 3(4)(c), which, because of these Lords amendments, will be available only within three years of Royal Assent. I very much hope that by then the new civil service compensation scheme will be in place and be operating satisfactorily for all concerned—civil servants, departmental employers and the civil service trade unions—and that the taxpayers’ interests and the proper interests of civil servants will be being met. Amendments 4 and 5 are consequential on amendment 6.

[John McDonnell]

The House needs to be aware of what this measure actually means, and I make it clear that I will press my amendment to a Division.

[Mr Deputy Speaker]

The hon. Gentleman will be able to move his amendment formally later.

[John McDonnell]

Thank you very much for that advice, Mr Deputy Speaker. I get confused when we are talking about sunset and sunrise clauses.

Let me explain what this measure means. Despite all we have heard today from the Government about their willingness to achieve a negotiated settlement on a new compensation scheme and their wish to ensure that all the trade unions are signed up to it and that it is acceptable both to members of those unions and to people not in those unions, the fact is that they will retain the power, over a three-year period, to impose the caps set out in the Bill.

We should remind ourselves of what those caps are: for a compulsory redundancy, an amount equal to a person’s earnings for 12 months, and that amount for 15 months for a voluntary severance. We heard in evidence in Committee—this has been repeated in the Chamber time and again—that that will mean a cut of up to two thirds in the redundancy payments of many civil servants; 60% to 70% was the figure cited by the Joint Committee on Human Rights. Any Government will have the power to impose those caps at a later date, and to impose that level of penalty on civil servants who are made redundant.

If the Government are confident of being able to negotiate an agreed solution under the new scheme in this coming period, why do they need the right, over a three-year period, to impose these caps unilaterally? I still think that if they sought to do that, it would be subject to a legal challenge, but why would a Government seek to retain that power if they were entering into negotiations with good will, genuinely seeking an agreement, and taking every reasonable step to secure one?

My amendment simply seeks to reduce the period to 12 months, as an act of good will on behalf of this House in respect of its employees in the civil service. I believe the Government have set the period at three years because they want to maintain their original purpose for the Bill, as previously described: to use it as a blunt instrument to bludgeon the unions into submission so they agree to the Government’s proposals. That is unacceptable. I also think this will be another factor that leads to people rejecting the overall scheme in the ballots that are currently taking place, and instead moving on to take action to stop the scheme being imposed upon themselves and their fellow trade union members.

I urge the Government to think again, as 12 months should give them sufficient time to negotiate and introduce a new scheme, and to introduce any reforms or amendments that might be needed to hone it to make it more workable if there were any problems with its implementation. It is unacceptable for the Government to have the threat of this blunt instrument to hold over civil servants for three years. Introducing this measure would be another contributory factor to the deterioration in the relationship between the Government and their staff, who are meant to implement, with high morale, the policies they introduce.

--- Later in debate ---

[Mr Maude]

The right hon. Member for Birmingham, Hodge Hill (Mr Byrne) asked why we needed to keep the caps at all. The answer is simple. The caps will be established in primary legislation, but the new civil service compensation scheme, which I hope to lay before Parliament next week, before the House rises, does not have the full force of primary legislation, despite the changes to the Superannuation Act 1972 made by clause 1.

I shall be frank. We want to avoid being in the position that followed the High Court judgment in May this year, which resulted in the previous Government’s February scheme being quashed. The effect of the scheme being quashed is that the existing scheme remains unreformed and in force. Indeed, the old scheme—unaffordable, unsustainable and unreconstructed—is in force today. Of course, in preparing the new scheme we were at some pains to ensure that it would be legally robust, and we shall vigorously defend any legal challenge to it. However, as was apparent from the litigation against the previous Administration’s scheme, there can never be guarantees in litigation. Even litigation that is destined ultimately to fail can be disruptive, because of the uncertainty it causes until the case is concluded.

[John McDonnell]

Could we clarify what the Minister has just said? Is the provision he supports simply a device to be used to prevent UK courts from quashing the Government’s proposals?

[Mr Maude]

I shall be clear: both sides of the House have accepted that the current scheme is unsustainable and needs to be reformed. With the possible exception of the hon. Gentleman, everyone—and certainly Opposition Front Benchers—has accepted that it is unacceptable for it to be possible for a union, or two unions, to veto reform of the scheme. It must be possible for the Government and Parliament to effect reform of the civil service compensation scheme. If there is a successful legal challenge to a new civil service compensation scheme—unlikely though that may seem—we cannot have the position where the old scheme trundles on in its unsustainable, unaffordable and unfair form. That is why there must be a fall-back position for a limited period. We have listened to the arguments and we have accepted that it will be a limited period, so that caps on the use of the old scheme will be in existence, should the new scheme be quashed as the previous Government’s scheme was, by order of the High Court.

What is the right period for the power to revive the caps? Is it one year, three years, five years or 10 years? There is no precise science, because no one knows how long the period is beyond which we could be sure that a successful legal challenge would not be raised. It is our judgment that three years is the right period. That is the view that we have taken. That is why we urged the Lords to agree, and I urge the House to accept that view today. We would thus be agreeing with the Lords in their amendments, and disagreeing with the amendment proposed by the hon. Member for Hayes and Harlington.

Lords amendment 4 agreed to, with Commons financial privileges waived.

Lords amendment 5 agreed to, with Commons financial privileges waived.

Amendment (a) proposed to Lords amendment 6.—(John McDonnell.)

Question put, That the amendment be made.

Superannuation Bill

John McDonnell Excerpts

Wednesday 13th October 2010 Commons Chamber

[John Hemming]

I thank the shadow Minister for saying what her objectives are. In the past, the Opposition have often had objectives that they failed to achieve. Their objective was to remove the trade union veto, but the amendment would reinstate it. Their objective is for this not to be a money Bill, but by voting against new clause 1 they would, if successful, make it a money Bill. I accept that the shadow Minister has particular objectives, but what she does tends not to work; that is the reality of the situation.

We have to be effective in terms of running Government. We must do things that work—that achieve results. This Bill is about achieving results: it is about creating a situation whereby there can be negotiations with the trade unions in which we can deal with difficult cases where individuals are suffering particular hardship. In the Public Bill Committee, there was an attempt to negotiate through discussions with the trade unions. That was dreadful—it was almost impossible to get anywhere, and I find it rather sad that anyone tried. The reality is that negotiations have to work in a particular way; one cannot negotiate through a process of producing legislation. We need a blunt instrument that creates an environment in which a negotiated settlement can be arrived at. To that extent, I support new clause 1.

[John McDonnell (Hayes and Harlington) (Lab)]

Following the final comments by the hon. Member for Birmingham, Yardley (John Hemming), I fully agree that we have been trying to create an environment in which agreement can be reached. However, if I were a civil servant watching this debate, with the prospect of the large-scale redundancies that will happen after the comprehensive spending review, I would almost despair. It will be extremely difficult for all of them to come to terms with the loss of their jobs. As a manager in the public sector in a former life, I have always found that people are realistic as long as their views are respected and they are involved in the discussions and negotiations, which have been entered into in a spirit of good will. To achieve that, we need to create a climate of good will where people feel that their views are being heard.

Despite my having opposed every cut of every job in recent years under the previous Government, we were told in the Public Bill Committee that 80,000 jobs were lost but there were only 80 compulsory redundancies. The negotiations that took place on the basis of the protocols established with regard to redundancies and transfer between Departments resulted in a system whereby large-scale compulsory redundancies were avoided. The Minister referred to past practice under the previous Government. As I said, I did not support the cuts that went on, but I genuinely think that they were committed to a negotiated settlement. In my view, had it not been for the interference of No. 10 and the Treasury—this is almost like history repeating itself—we would have obtained a negotiated settlement that all unions would have accepted. However, the settlement was imposed, and I opposed that. The PCS took the then Government to court because it believed that the accrued rights of its members were being interfered with contrary to law because it was an imposed settlement, not an agreed one. It was proved right in the court of law, and we have to come to terms with the reality of that.

[Harriett Baldwin (West Worcestershire) (Con)]

I am interested in the hon. Gentleman’s point of view on this. Does he believe that it is possible for the Government to negotiate to a satisfactory conclusion with the PCS given its position in all the negotiations?

[John McDonnell]

I do. I will come to that in a few minutes.

The position of the unions in the Public Bill Committee represented an attempt to acknowledge their responsibilities to their members. The PCS was in a similar position whereby, if it had not taken the Government to court to assert its members’ rights to their accrued rights and to consultation and agreement, it could have been taken to court by any individual member for failing to undertake its duty to its members.

Under the previous Government, there was a genuine attempt to negotiate a settlement. Under the current Government, I have found in my discussions with civil servants—not only PCS members but members of the other unions—that there is uncertainty among many of the people who may well be affected by the cuts to come as to whether the Government genuinely want a settlement, and anxiety that the Government are seeking to provoke a dispute. I listened to the Minister’s words, and I am grateful for them: they were positive and tried to create the climate in which a negotiated settlement can be achieved. However, the pattern of negotiations and ministerial statements in the past few months has not engendered an atmosphere in which a negotiated settlement can be brought about. That is why the Opposition have tabled their amendments. Every trade union representative at the Public Bill Committee made it clear to us that it was unprecedented for a Government, in the midst of negotiations, to introduce a Bill to impose a settlement in this way. It has never happened before in negotiations between a Government and the public sector.

[John Hemming]

Does the hon. Gentleman recall from the Committee that the senior civil servant responsible for the issue said that he would have advised any Government to take this sort of approach?

[John McDonnell]

That very civil servant’s advice landed the last Government in court, where they lost. I met him in the week before the general election and said to him: “You will lose in court because this is inaccurate advice on legal grounds, but in addition, it will not contribute to the conclusion of a negotiated settlement, and we’ll be back again within weeks”—and we were.

[John Hemming]

Does the hon. Gentleman accept that this is not ideologically driven but driven merely by the difficulties of our current circumstances?

[John McDonnell]

I do not believe that many civil servants who will be affected by job losses believe that the Government are seeking to resolve this matter by negotiation, and I am trying to reflect those views. We in this House, and the Government in particular, need to go the extra mile to get back to an atmosphere where there is confidence among the people who may well be threatened with the loss of their jobs, and we need to convince them that there is the opportunity of a genuine negotiated settlement. As I said in Committee, our responsibility is to seek to create a climate in which a just, negotiated settlement can be engendered.

[John Hemming]

Does the hon. Gentleman accept that the fact that the Government are inserting a new clause that prevents this from being a money Bill is a sign of good faith from them?

[John McDonnell]

I will come to that.

There has been a litany of disasters during these negotiations. If we want to secure an agreement, we need to try to keep everyone on board. The puerile attempts to divide the unions have been completely counter-productive. The first attempt was to try to insinuate that the PCS negotiator had agreed the terms but had been overturned by the PCS executive. That was put to the PCS negotiator in the Public Bill Committee and it was denied, so it is not true. In fact, the PCS did what it always does as a democratic union—it takes the issues back to the executive. It is probably one of those unions that consults its members more than any other.

The second attempt to divide the unions was by the reference to five unions having agreed a settlement and only the PCS being excluded by refusing to do so. The Minister put out a press release that caused anger among the trade unions. The Prison Officers Association immediately issued a press release saying that letters written to the Minister, in confidence and without prejudice, were put in the public domain. The result is that this week the POA has rejected the deal.

It seems that four of the six unions were originally going to put the deal to their members, but the POA and PCS represent more than 90% of the people who will be affected. They are the unions that we have to convince if we want a negotiated settlement, and they are negotiating on behalf of their members based on what those members tell them through their executive.

[Mr Maude]

The hon. Gentleman asserts that the POA and PCS represent more than 90% of the people affected, but only 60% of civil servants are members of trade unions to begin with.

[John McDonnell]

I meant 90% of the trade union members with whom the Government are negotiating.

May I tell the Minister what the POA has said about his words? Its general secretary Steve Gillan has said:

“I am annoyed that Mr Maude has leaked without prejudice discussions but I believe this has been deliberate in an attempt to drive a wedge between the POA and PCS. The POA will not allow him to do so.”

The Minister’s actions have meant that the union has now rejected the deal. Those actions were not responsible, and they were in contrast to the words of comfort that he has used here today and elsewhere in trying to engender a good industrial relations climate.

As my right hon. Friend the Member for Dulwich and West Norwood (Tessa Jowell) said, Members need to understand the strength of feeling among PCS, POA and other trade union members about the impact that the changes will have on their lives. We have had heart-rending cases submitted to us by people who have entered into mortgages, for example, believing that they had the security that even if they lost their job, they would have redundancy pay that would cover their mortgages. Now, they might lose their homes. We have heard of other people who were expecting significant compensation related to their salaries, one of whom would now lose £90,000 as a result of the Government’s proposals. No wonder people are angry and concerned. That is why they want their Government and their trade unions to come together to agree a fair way forward.

[Harriett Baldwin]

May I ask again the question that I asked earlier? Can the hon. Gentleman see a way for the PCS to agree to any negotiating position?

[John McDonnell]

Yes I can, and the PCS has written to the Minister again recently asking for meetings. I believe that one meeting has taken place, so there is potential. However, we cannot expect a negotiated settlement to take place when tactics are used that undermine the confidence not only of the PCS but now of the POA. That lack of confidence is now infesting other unions as well.

[Mr David Ward (Bradford East) (LD)]

Does the hon. Gentleman share my concerns about employees beyond those directly affected by the Bill? I am concerned about the hundreds of thousands of employees in the rest of the public sector who will be watching the process closely and wondering what the next stage will be as we rebalance the economy from public sector jobs to private sector jobs.

[John McDonnell]

I take the hon. Gentleman’s point, which is valid and valuable. The Bill sets what many believe is a precedent for what will happen elsewhere, so it behoves us to get it right and ensure that we create a climate in which people at least understand that they will get a fair deal.

The Government’s tactic of the use of a money Bill was derisory. This was never really a money Bill, and when we asked for the justification for its being used as one, nothing was forthcoming. I have seen no note from Minister even defining it as such. It was simply a tactic whereby the Lords would have been excluded from amending the Bill, which would therefore have been implemented earlier. This House would have been denied the second opportunity for debate provided by Lords amendments. That tactic had an impact on people’s confidence in the genuineness of the Government’s approach to the negotiations.

The Government’s approach to the concept of accrued rights has been blasé. Their interpretation of accrued rights—that they are not really accrued but are obtained only at the time of a redundancy—seems contrary to not just law but common sense. I cannot see it standing up in any court of law, and it could indeed be challenged in court. As was said on Second Reading—by the Chair of the Public Administration Committee, I believe—the Bill could be enacted and then the scheme challenged in a court of law and the European courts. The Government could lose again, as they already have once, and then we would have to pay compensation to all the people who had been made redundant in the interim. That is no way to treat people and certainly no way to enact legislation.

I have some anxieties about the Government’s new clause, which is why I support my party’s Front Benchers’ efforts to eradicate it. It is there as a threat that the Government will drive people out of employment on the lowest terms possible. It would also enable them to amend the scheme in future. There are now additional proposals to change the protocol involved, the notice period for redundancy and other matters, which would undermine the protection of people who lose their jobs and the flexibility of a manager to avoid compulsory redundancies, which the hon. Member for Birmingham, Yardley sought.

The Government’s handling of the issue has soured the industrial relations climate in the civil service and sent a message to trade unions in other areas, such as health, teaching and local government, that what has come to the civil service unions affected may be visited on them. If the Government do not learn the lessons of the debates on the Bill over the past few weeks, they will provoke industrial action, and that action will be justifiable. Unions will have sought to negotiate a reasonable settlement, but the Government will have played fast and loose with the process, refused to listen and imposed something that will have a considerable effect on the lives of people threatened with the loss of their jobs.

To answer the question that the hon. Member for West Worcestershire (Harriett Baldwin) asked me, the position of the PCS, and now of all the other unions, is that they would welcome the Government going back to the negotiating table for serious negotiations. I urge the Lords to amend the Bill so that it will be brought back here for debate. I welcome the Government’s proposals for amendments in the Lords, because they would give us the opportunity for further debate and a further period in which there would hopefully be serious negotiations. They would give this House a long-stop role, so that we could determine whether there had been a just settlement and whether the Bill should therefore pass.

Finally, the House should not underestimate the strength of feeling of public servants on this issue. We have a responsibility to them and to our constituents whom they serve. If we undermine their role in any way through the Bill, we will live to regret it and so will the Government.

[Richard Graham (Gloucester) (Con)]

I am puzzled by the logic of the Opposition’s position this afternoon. At the beginning of the Bill’s passage, it was agreed throughout the House that every party recognised the need for change. The right hon. Member for Dulwich and West Norwood (Tessa Jowell) tried to bring it about. She introduced her Bill, but she was blocked and prevented from taking it through. The ball passed to the coalition parties, and we have now introduced a new Bill that recognises the bluntness of the instrument required to achieve a negotiated settlement.

We have heard this afternoon from my right hon. Friend the Minister about the deal on the table, which, if I understand it correctly, will offer up to 21 months’ pay on voluntary terms, plus a notice period of three months, making a maximum total of 24 months’ redundancy pay for all civil servants earning less than £23,000 a year, but based on that £23,000 figure. That is a better deal than the one that the Labour party offered civil servants earlier this year. When the right hon. Member for Dulwich and West Norwood said that she would oppose new clause 1 on the basis that our civil servants deserve better, I was left wondering which civil servants she meant. The truth is that the debate clearly shows that those of us who support new clause 1 do so precisely because we want a much better deal for lower-paid civil servants, which is the whole exercise of the Bill.

--- Later in debate ---

[John McDonnell]

Much has been said about the need for the unions to negotiate. Let me be clear about the unions’ position, as a number of general secretaries are in the building today. The POA makes it clear in its statement that it has rejected the Government’s final offer, but it has left the door open for further dialogue with the Government, which must be meaningful with all the Council of Civil Service Unions present and with no exclusions.

Mark Serwotka of the Public and Commercial Services Union has written to the Government and briefed other MPs to the effect that he is keen to re-enter talks, but stresses again that they must be meaningful. The PCS believes it has worked hard to reach a settlement. Let me quote Mark Serwotka:

“From the outset PCS has worked hard to come to a fair deal. We cannot accept the current offer and are calling for further talks. If those talks do not take place we will continue to oppose the Bill in Parliament and will take legal action when appropriate as we have successfully done in the past.”

The two unions representing the vast bulk of the civil service members who will be affected by the Bill are willing to negotiate.

The problem seems to be not the Minister’s willingness to negotiate, but the Treasury envelope within which he is negotiating. If that is the problem, I suggest that the Treasury gets directly involved in these negotiations as well, so that it can see that its attempt to gain a short-term saving will have a long-term cost to the Government. That might help to get some productive negotiations going. By the time the Bill comes back from the other place, we might have a settlement across all the unions, but any attempt to try to divide the unions again will, I believe, be counter-productive. We now need to create a climate of industrial relations that will enable these negotiations to take place successfully for all the unions, not just for a small minority.

Question put, That the Bill be now read the Third time.

Superannuation Bill

John McDonnell Excerpts

Tuesday 7th September 2010 Commons Chamber

[John McDonnell (Hayes and Harlington) (Lab)]

I chair the PCS parliamentary group. It is a cross-party group that was formed a number of years ago, and several Members of Parliament on both sides of the Chamber tonight are members of it. I think it has been helpful for Members of Parliament to gain a knowledge, through the union, of what the union’s members undertake, how they effect their work and the role that they play.

PCS represents the largest number of civil servants, and certainly the largest number affected by the compensation scheme, and I want to add my name to the compliments that have been paid today, across the Chamber, with regard to civil servants and the role that they play. It is an admirable tradition, serving Governments of all political colours, with commitment and dedication that is second to none across the globe. It is slightly ironic that we praise them now, and yet, by the looks of it, in a month’s time we are going to lay off and make redundant the largest number of civil servants ever in our history, as a consequence of the comprehensive spending review. Anyway, we are all committed to the existence of a civil service that implements the policies of a directly elected Government.

There are certain measures that Governments introduce that can be described as land mine Bills. Judging by the type of the legislation or their subject matter, they might appear relatively innocuous at first, but they are political land mines that can permanently damage and taint an Administration. I think the art of good governance is to identify—perhaps from bitter experience—the potential disasters, those land mines, and avoid them. This Bill is a political land mine. It is potentially extremely potent and it is an explosive issue. I think it is potentially disastrous for this Government and I think, coming at it as an ex-bureaucrat myself, that it will undermine their ability to implement their overall programme. Why? Well, many Members have commented that they have discussed with constituents and civil servants and they have received representations, so many Members will share the feeling that I have. I think morale is being affected by this legislation and the way in which it is being handled. I think morale at the moment in the civil service is at an all-time low as a result.

The Government have been democratically elected and have the right to implement their policy programme, but every manager, whether in the public or the private sector, needs not only resources and clear objectives but a committed, dedicated and motivated staff. The imposition of the Bill is undermining that morale, that commitment, that dedication, that we so need among the work force.

There is a depth of feeling about the unfair way in which people are being treated in the civil service. I have met many PCS members, including many who are my constituents, and there is resentment of the Government’s political action on this issue. The most common response that I—and, I am sure, other Members—have met is the simple statement, “We didn’t cause this economic crisis, but we’re having to pay for it with our jobs and with cuts in our conditions of service, and this is the latest round of those cuts.” There is a real, palpable sense of grievance, particularly as the bankers who did cause the crisis are not just back in position, but have, in some cases, been appointed to higher positions. Some have even been appointed to ministerial positions in recent weeks. Bankers are coming back for their obscene bonuses and obscene pay. There does not seem to be any equity or equivalence of suffering. There is a feeling among civil servants that we are not all in this together.

[Sajid Javid (Bromsgrove) (Con)]

The hon. Gentleman will know that the budget deficit that this Government inherited from the previous Government is £155 billion, but even the structural deficit, which was there before the economic crisis commenced, was £128 billion. The country was already living way beyond its means. That is why his Government tried to make changes to the scheme, and it is a reason why we need to do so. It is no good trying to blame the problem on a particular profession. If he is going to pick a profession to blame it on, he should pick the political class represented in the previous Government.

[John McDonnell]

The hon. Gentleman came to the House at the last election, so he may not know that I was probably not the most vociferous supporter of the economic policies of the previous Government. I was a critic, and if he looks at the alternative Budgets that I provided annually—which this House rejected, but never mind—he will see that there would have been no deficit if I had implemented them. There would have been a redistribution of wealth and an increase in taxation, which would have enabled us to afford the public expenditure that our society requires.

I am not a Keynesian; I am a Marxist—[Laughter.] Well, it is interesting how true some of the predictions in “Das Kapital” are coming. Even if one takes a Keynesian position, the last thing one would do at this point in time is reduce aggregate demand and cut jobs, wages and conditions of service. It flies in the face of reality to lay off large numbers of civil servants, and then cut the income and compensation arrangements that they receive. Anyway, Mr Deputy Speaker would rule us out of order if we went into another economic diatribe.

[John Hemming]

The hon. Gentleman appears to be arguing, relatively coherently, for no change whatever to the terms and conditions of public servants. Is that what he is arguing, or is he arguing that some change is reasonable? If so, what change would be reasonable?

[John McDonnell]

I recognise that a range of negotiations need to take place. In the last set of negotiations with the previous Government, there were various issues to do with changes tackling age discrimination in particular. My view—we have to come on to the reality of the negotiations that will have to take place—is that we can create a climate of opinion in this House and elsewhere that will enable those negotiations to come to fruition, and that we should protect the lowest paid, in particular, as best we can. That has been the commonly voiced demand in the Chamber today.

[John Hemming]

Does the hon. Gentleman agree that the best way to protect the low paid is to protect them from redundancy?

[John McDonnell]

Yes, and that is why I have consistently put forward alternative economic policies and strategies.

Let me press on, if I may. This is a serious debate, and I am trying to get across the feelings expressed to me through the PCS parliamentary group. As I say, I have met PCS members, I have attended meetings of the executive, I have been on picket lines, and I have been at various meetings around the country. There is anger about the proposals in the Bill—I shall come on to that—but also about the way in which the issue has been handled by Ministers.

In interview after interview, and even in the Chamber today, Ministers and Government Members have focused, in their descriptions of the compensation scheme, on payments to the highest-paid civil servants; it has almost been a portrayal of “Yes Minister”-type permanent secretaries, retiring to their Whitehall clubs on large-scale pay-offs. There are some individual examples of that, and they have been quoted today, but PCS is one of the leading unions that has pointed out that issues around high pay within the civil service have undermined the equitable distribution of rewards in the public sector.

Time and again, including today, we have had repeated the example of some civil servants receiving up to six years’ wages as a redundancy settlement. Let us get this point on the record as best we can: if I may refer Members to the Library note, of 500,000 civil servants, only 4,400 are in the senior civil service. The maximum compensation for most is capped at three years’ pay under the compulsory scheme, and two years’ pay under the flexible, voluntary scheme. For a small number of people who joined the service before 1987 with reserved rights regarding severance payments, payments are higher.

Ministers were asked by the Public Accounts Committee and, I believe, in parliamentary questions on the Chamber Floor, for information on the number of individuals currently getting a package worth six years’ salary. We were told that the information was unavailable because it could be provided only—there is a sense of irony here—at disproportionate cost. The six-year allegation is consistently used, even today. I would welcome some facts on how many people we are talking about and what the costs are.

[Martin Horwood]

Perhaps I could be of assistance to the hon. Gentleman. One of my constituents, a civil servant, calculated that to qualify for that six-year maximum, one would have had to have joined the civil service just after one’s 17th birthday and have been made redundant just before one’s 50th. I suspect that we are talking about a very small number.

[John McDonnell]

Would it not have been useful, though, if we actually had the number so that we could have a properly informed debate, rather than allegation, counter-allegation and, almost, smear?

Ministers were also asked how much public expenditure the imposed scheme would save—my right hon. Friend the Member for Dulwich and West Norwood (Tessa Jowell) on the Front Bench raised the issue again today—but that information has not been forthcoming. The Secretary of State has said that the amount is impossible to calculate. I have been there; I have advised decision makers—and in the private sector it is exactly the same—and when one is entering a redundancy situation, one does a rough, or even a back-of-an-envelope, calculation of the numbers one is looking to lose, the amounts, the average rates of pay, the distribution of the rates of pay across the service, and therefore roughly what the cost would be. That is not too much to ask before we make a momentous decision on this legislation. In fact, the Public Accounts Committee raised the issue again in July, and the Minister refused to respond.

I deal now with the myth of the highly paid civil service. Some people have already mentioned the subject today, but it is important that we get the point on the record. Even though this has been denied today, it has been part of the Government’s strategy to promulgate the myth of a highly paid civil service.

[Kwasi Kwarteng (Spelthorne) (Con)]

I am unclear about the hon. Gentleman’s position on the status quo. Does he believe that the system is sustainable at current levels, given the economic climate?

[John McDonnell]

I believe that people who are made redundant should be properly compensated and, yes, I believe that the system put forward by the last Government was certainly affordable. I actually believe that the mechanism previous to that is still affordable. However, I accept that there was a need for reform. That is what the unions were negotiating on. It was not the PCS’s fault that the last scheme fell apart; the Government ruled that the process by which it was introduced was unlawful—it is as simple as that.

Let me return to the myth of a highly paid civil service that is promulgated, if not today, certainly elsewhere, including by the media. Yes, there are some highly paid civil servants, and we have dealt with that today. The unions themselves are at the forefront of highlighting the need to tackle high pay and bonuses. However, as had been said, the average civil service pay on which redundancy payments are based is £22,850 a year, compared with £24,970 in the private sector. There are 35,000 civil servants who earn less than £15,000 a year. Some 210,000 people—40% of the civil service—are paid £20,000; 350,000, less than £25,000. The bulk of our civil servants are on low or relatively modest pay.

The other tactic that is used—and it has been paraded again today by Ministers and Members in the debate—is a justification of the attack on the compensation scheme by divide and rule, playing public sector workers off against private sector workers. The Government have argued that many people in the private sector receive only statutory minimum redundancy payments or low-level additional scheme payments, but the reality is that most private sector workers are covered by some form of additional scheme, and are usually protected by its being written into their contract of employment. The fact that the level of many of those compensation payments is disgracefully low in some parts of the private sector is no justification whatsoever for undermining standards in the public sector. It is an argument for raising levels and standards in the private sector, even in these economic times.

The argument that when civil servants take on their job they weigh up the merits of going into the public or private sector has been made today. Wages in the public sector are lower, but the benefits are better, and usually more secure—that is the calculation that is made. If we compare civil service grades with jobs in the private sector, we can see that admin officers in the civil service earn 21% less than people in comparable jobs in the private sector.

[Sajid Javid]

I thank the hon. Gentleman for giving way to me again. The latest report by the Office for National Statistics in 2009 stated that the median weekly salary in the public sector was about £540 versus £470 in the private sector.

[John McDonnell]

I shall refer the hon. Gentleman to the figures, so we can base the debate on them. I repeat: average civil service pay is £22,850 a year compared with £24,970 in the private sector.

[Sajid Javid]

The hon. Gentleman might want to pick up the report from the House of Commons Library which contains the exact numbers: £539 a week in the public sector versus £465 in the private sector.

[John McDonnell]

I will not quote the figures again, but I refer the hon. Gentleman to the income data survey. I am happy to provide him with a PCS briefing that sets out the figures. [Interruption.] Well, the briefing is based on information independently issued by the income data survey.

In the executive grades, supervisors in the public sector—people with vocational qualifications—earn 18% less than supervisors in the private sector. The decision to go into the public sector, as I have said, is based on a judgment in the round about security, benefits, pensions and, yes, redundancy payments, which are described as accrued benefits that people earn over time. They are part of their wages. What is happening today is a Government unilaterally tearing up the contract that was entered into when many of these civil servants entered employment. I think that that will be open to challenge on the grounds of human rights compliance. Inevitably, members not just of the PCS but of other unions will wish to exercise their rights in law. What is happening is the worst of all worlds for civil servants.

[Andrew Bridgen (North West Leicestershire) (Con)]

Does the hon. Gentleman believe that it is fair or affordable in the current economic situation for anyone to be given six years’ pay as redundancy pay?

[John McDonnell]

Perhaps the hon. Gentleman was not listening. The period of six years has been used time and again to justify the measure. A tiny number of cases are involved, but we would like the exact number. If he can help us to extract that information from his own Ministers, that would be useful.

The vast bulk of civil servants who have been made redundant have been laid off on conditions of no more than three years’ pay, and the majority of them on considerably less. Under the terms of this measure, that will be reduced by two thirds. It is not about the tiny minority who receive six years’ pay, but about the vast majority who will lose up to two thirds of their payment.

[Matthew Hancock]

rose—

[John McDonnell]

I will press on, and give way to the hon. Gentleman shortly.

The position now is the worst of all worlds for civil servants, who are facing a double whammy. They enter a service in which they are paid less than the private sector, but at least they receive some benefits as a result of the security of pension and redundancy payments and so on, but their redundancy payments are to be cut while at the same time their pay is frozen or cut.

There is no protection in the Bill for the low-paid—we all agree about that. Members have appealed for details, but the ministerial response is that this is not the place to begin negotiations. The Bill begins negotiations, and it is a negotiating ploy. The Minister could at least set out the parameters or the options available to protect the low-paid. The argument goes that that will be negotiated with the unions in separate negotiations, but do Members of Parliament not have an additional responsibility to represent the interests of their constituents? When hon. Members vote on the Bill, they need security of information to protect their constituents’ interests. They need to know in more detail how their low-paid constituents will be protected as a result of the legislation. However no fragment of information has been given, nor have parameters been set by the ministerial words we have heard today.

When we deal with legislation of this sort, we need to consider the impact on people’s lives. The worst feature of the Bill is the Government’s almost brutal disregard of the human consequences. Tens of thousands of civil servants are likely to lose their job in the coming years. In the economic crisis, even if there is no double-dip recession, and we just rattle along the bottom for the next three years, most of those people will struggle to get back into work at all or find work offering similar wages. If we look at previous recessions, particularly for older workers, we can see that some of them never work again. We must recognise the devastating impact that that will have on individuals and families.

Most people in this country lack savings. Various reports by citizens advice bureaux show that even people in work lack savings beyond a month’s salary or wages. Most people have enough for only two months’ mortgage payments, so are close to default. Reducing redundancy payments in this way undermines people’s ability to survive the devastating impact of losing their job. It also undermines their ability to get back into work in many instances, because it is a costly exercise to travel around the country looking for work. The measure will introduce poverty and stress, and put pressure on people who have lost their job. The irony is that whatever savings are found will be significantly reduced by the benefits that we pay out. Many of the people we employ to administer unemployment benefits will receive those benefits themselves as a result of cuts in public expenditure.

Many of the PCS members I meet are desperate as a result of the anxieties engendered by the Bill, and they are becoming angry. When people perceive that an injustice has been done to them, they react. Boiling point has been reached as a result of the autocratic methods used by the Government to impose their way. They have introduced legislation before serious negotiations have taken place. It is like putting a cosh on the table before beginning a dialogue. The use of the money Bill device to prevent full parliamentary scrutiny is despicable. I have looked at “Erskine May”, and I urge other Members to do so. I cannot see how this can be defined as a money Bill. I hope the Speaker will rule against it after Third Reading. If it is passed as a money Bill, it will be implemented within a limited time scale, with no potential for amendment in the other Chamber.

The introduction of a sunset clause sends out a message that if the economic situation worsens, the Government will come back for more, and there will be further cuts in the scheme after that year. The Bill immediately soured the industrial relations climate under the new Government, and that does not apply just to the civil service. Across the public sector teachers, local government workers, health workers and those working in the emergency services are all on better terms than the terms introduced by the scheme in the Bill, so they see the legislation as the starting gun for an attack on their conditions and their redundancy payments.

Some have put a more sinister construction on the Government’s intentions. It is clear that the Government’s strategy is that the economic recession will be solved on the basis of cuts in the jobs, services, wages and conditions of employment of working people. For those of us who have been around a while, it smacks of the same old policies of the 1980s. In that period a Conservative Government decided that the unions had to be broken if the Government were to be able to force through harsher cuts. They took on the miners’ union, for which I worked at the time. It was an attempt to break a union as an example to others. The present Government appear to have identified the group of public sector unions as the modern day target. I am sure we will soon be hearing statements about enemies within and so on.

If that is the Government’s strategy, they are sorely mistaken. My sense is that the public servants who will be affected by such legislation will not take it lying down. Members have been lobbied already. They are aware of the growing anger, and there will be resistance. That will have public support, particularly as our communities begin to experience the impact of the cuts to their services and increasingly appreciate the scale of the damage that will be incurred by our society.

I appeal to the Government to pull back from this mistaken approach of imposition, which will lead to confrontation. I urge them to get back to the negotiating table and to agree a serious and sensible way forward. They should take the cosh of this legislative proposal off the table to allow proper negotiations. Ministers could sensibly withdraw the Bill tonight. Failing that, I urge Members to reject it because there is nothing in the Bill or in the words uttered by Ministers today that gives us the guarantee of the protection of our constituents that we require. The Bill will damage the civil service that we have all commended in today’s debate as an exemplar to the world.

I warn the Government that issues such as those raised by the Bill, which appear minor at first glance, become the combustible material that eventually brings down a Government. I urge Members to reject the Bill tonight.

[Several hon. Members]

rose—

--- Later in debate ---

[Mr McCann]

I always tend to go with the majority; that is the democratic thing to do. When five out of six trade unions accept a deal, that tells us something. I would have taken the view that the majority position should have won through.

[John McDonnell]

For the sake of accuracy on the record, I should point out that the vast majority of members affected are PCS members; the numbers from the other unions are relatively smaller. Actually, when balloted, 63% of PCS members affected voted against the proposal for the scheme and in favour of industrial action.

[Mr McCann]

My hon. Friend is correct that 70% of those covered by the negotiations were PCS members, but we should bear in mind that 150,000, or 50%, of them would have been protected by the Labour Government’s proposals. It is also dangerous to go down the line of citing figures from ballots because we then tend to look at how many people voted in them.

[John McDonnell]

Just to be accurate for the record, it was one of the highest ballot turnouts that any union has had. The turnout was excellent.

[Mr McCann]

With the greatest respect, I do not think that people should worry about numbers—we need to go to the meat of the debate, which is about protecting low-paid civil servants who would be disproportionately affected by the proposals.

The Minister may feel that the PCS has been foolish. He may feel that he wishes to take advantage of the PCS’s vulnerability at this time and punish it. I genuinely urge him not to do so, because we anticipate a hard time for civil servants, many of whom may be made redundant as a result of the comprehensive spending review, and it would be vindictive in the extreme to hit them with the double whammy of redundancy and then a poor redundancy payment to boot, and to strip them of the hard-won conditions of service that they had.

You will be delighted to hear, Mr Deputy Speaker, that I am now going to sum up. The February 2010 deal was a fair deal, in my view. It saved money, it protected the lowest-paid, and it covered the protection of civil servants’ redundancy payments and early retirement provision. We should not be attempting to punish members of the five trade unions who backed the February 2010 deal, nor should we punish PCS members, even if Ministers believe that the PCS strategy was somehow misplaced. To use the motto of Government Members, if we are all in this together, we should be fair to civil servants. We should put the February 2010 deal back on the table, legislate for those changes, and get the deal done. Then, we can ensure that all public servants who work in the civil service are protected properly.

--- Later in debate ---

[The Parliamentary Secretary, Cabinet Office (Mr Nick Hurd)]

This has been a serious debate. It has been very sober in tone, and that is entirely right because we all know that there is tremendous anxiety out there about job losses and potential changes to the compensation scheme. Many Members have received representations on this matter, and many came to the House today to express strong constituency interests. They included my hon. Friends the Members for Cheltenham (Martin Horwood), for Stafford (Jeremy Lefroy) and for Vale of Glamorgan (Alun Cairns), and they represented those interests very strongly.

What was striking as I listened to the debate was the consensus about the need for reform. That was not seriously questioned. The issue before us, then, is how, in seeking to reform the compensation scheme, we strike the right balance in treating fairly civil servants who lose their jobs or give them up voluntarily. As was stressed consistently throughout the debate, particularly by my hon. Friend the Member for Gloucester (Richard Graham), the issue is especially important to the large number of civil servants who are not well paid. How do we strike the right balance between being fair to them and discharging our responsibility to the taxpayer at a time when there is tremendous pressure on the Government to get public spending under control, as my hon. Friend the Member for South Staffordshire (Gavin Williamson) emphasised? My hon. Friend the Member for West Suffolk (Matthew Hancock) was entirely right to introduce the concept of fairness to future generations when talking about the need to get the deficit under control and tackle it with vigour.

As for the case for change, my right hon. Friend the Minister for the Cabinet Office made the Government’s starting position very clear. This legislation is not an attack on the civil service. Many Members have placed on the record their appreciation of the crucial work undertaken by civil and public servants every day and across all Government Departments, and no one recognises that more than a young, new Minister with no experience of Government who relies on civil servants and the dedication and support that they give.

We simply believe that the current arrangements for compensating civil servants are unaffordable and unsustainable. My hon. Friends the Members for West Worcestershire (Harriett Baldwin) and for Vale of Glamorgan were right to express the surprise that their constituents would feel on understanding that in this day and age public servants are eligible to receive payment of up to three times their annual salary or, for older workers, enhancements to pensions and lump sum payments costing more than five times their salaries. That seems disconnected from constituents’ experience of the real world, disconnected from statutory terms—a point well made by the hon. Member for Birmingham, Yardley (John Hemming)—and clearly out of kilter with terms in the private sector, as my hon. Friend the Member for Devizes (Claire Perry) argued.

The view of the coalition Government is that the status quo is unacceptable. As we made clear in the coalition programme, we want to bring this scheme more closely into line with that of the private sector. Critically, that view was shared by the previous Government, who tried to reform the scheme honestly, but ultimately without success. That view was apparently shared by five of the six unions involved in the negotiations, as they agreed to the package on offer. The case for change seems to have been accepted by the majority of speakers.

On affordability grounds alone, a responsible Government dealt the hand that we have been dealt on the public finances would have had to take action. As my hon. Friend the Member for West Worcestershire pointed out, there is also a risk of the current situation distorting decisions and creating unfairness. We do not want to take decisions on people’s future based on how easy or cheap it is to make them redundant. The effect of the current scheme is to make it particularly expensive to make the highest-paid public servants redundant. We do not want uncertainty to drag on, as it is bad for everyone and will breed only more insecurity. We want the uncertainty to end decisively.

As I said, I heard no serious arguments against reform. The debate on the Opposition side, honest as it was, was mostly about process and how the Government are going about this business. Strong reservations were made about the possible certification of the legislation as a money Bill, but that is clearly a matter and a judgment for you, Mr Speaker, at the end of the Bill’s passage.

My hon. Friend the Member for Harwich and North Essex (Mr Jenkin), the Chairman of the Public Administration Committee, raised concerns about the risk of a legal challenge to the Government’s approach and wanted comfort on the robustness of our legal advice. He will be aware that trade union members and some hon. Members have placed on record the risk of a legal challenge, so he will not expect me to go into the details of the legal advice. I can confirm, however, that it is robust.

The main argument from Labour Members was, “Why not go back to the deal that was almost struck? Why not amend the legislation so as to impose the terms agreed with the five unions earlier this year?” The truth is that the previously agreed terms were struck down by the courts and were not accepted by the Council of Civil Service Unions. Although those terms had much to recommend them, we would prefer not to see some aspects in the new scheme—for example, compulsory terms more generous than those on voluntary departure. Rather than embedding the scheme in primary legislation, we have sought to limit the costs of the current scheme while discussing the contents of a new scheme.

While I understand the concerns expressed by many Members about process, I believe that there is a danger of missing the central point. Reform is necessary—the status quo is not an option—and we want to achieve reform through negotiation. The Minister for the Cabinet Office has informed the House of his meetings with the Council of Civil Service Unions on 13 July, and of an imminent meeting. There are ongoing discussions almost daily, which he has described as genuine and sustained. We have sent a clear signal of flexibility on terms for voluntary redundancy, and have expressed a clear determination—this will be important to the House, given the concerns that have been expressed—to agree on terms that are fair to the lower paid. The model that we are exploring seeks to taper the protection given to the very lowest paid, but the limits and thresholds of such protection are clearly a matter for detailed negotiation, and should not be the subject of speculation in the House.

Why is the Bill necessary? It is necessary until we can reach an agreement with all the unions, because the current position enables them to veto any meaningful reform—a point grasped by the hon. Member for Birmingham, Yardley and many others—and they have demonstrated a willingness to use that power. Until we have secured agreement, we would be failing in our duty to the taxpayer if we retained the status quo and did not address the excesses.

The Bill does not itself introduce a new scheme, but merely limits the amounts that can be paid out under the terms of the current scheme. We have made it clear that those limited amounts represent the absolute minimum that the Government are prepared to offer staff. My hon. Friend the Member for Harwich and North Essex described that as an austere statutory base, but what was not mentioned was that the Bill makes it possible to adjust the amounts in one direction only, namely upwards. The Government seek to provide an example for other employees on good practice in relation to staff issues, and therefore have no desire to limit payments to the statutory minimum. The Bill caps the amounts to be received by staff departing on voluntary terms to payments calculated under the current terms, but limited to a maximum of 15 months’ pay. For those who are formally dismissed, the limit will be 12 months’ pay.

The Bill contains a sunset clause, and its effect can be brought to an early end if we are able to agree on a new scheme. We genuinely hope that that will happen. My hon. Friend the Member for Harwich and North Essex asked about the need for a sunrise clause as well as the sunset clause. I think it is impossible for us to be sure of every circumstance that could lead to a need to revive the Bill. The Government are therefore keen to maximise their negotiating flexibility. If we are unable to agree on a new scheme with the unions, the Minister for the Cabinet Office will have to renew the caps every six months by affirmative resolution.

The tone of the debate was extremely serious and consensual when it came to the need for reform, but I took exception to the suggestion by some Labour Members that the Government had no sensitivity in relation to the human consequences that might be forced on them. Labour Members chortle, but that suggestion is offensive to any Member on this side of the House. I do not think that anyone goes into politics to make other people redundant, except their direct political opponents. It is deeply offensive to ascribe the wrong motives to the Government. The coalition’s priority is to reach a long-term agreement on a new scheme with all the unions involved: an agreement that is fair to the civil service and fair to the taxpayer. The Bill is needed in case we are unable to reach such an agreement. It introduces caps so that we can limit the costs of the current scheme while we discuss the content of the new scheme.

[John McDonnell]

I do not intend to embark on any party-political knockabout during the last few minutes of the debate. A key issue raised was process, which is important because it can demonstrate fairness. One of the failures of the House in the past has been the way in which it has rushed through legislation. A lack of scrutiny, both here and in the other Chamber, undermines the potential for good legislation.

The Speaker will determine whether this is a money Bill, but the Government have designated it thus, and I should be grateful if the Minister would clarify the reason for that. Given the definition in “Erskine May” of a money Bill, I see no reason why a Superannuation Bill can be so designated. I think it would be useful to rehearse the arguments in front of the Speaker, so that a wise decision can be made.