Ministerial Severance: Reform

Andy Slaughter Excerpts

Tuesday 6th February 2024 Commons Chamber

[Esther McVey]

So the right hon. Lady could not apologise. She could not, or did not want to, stop the waste of hundreds of billions of pounds.

I will say this: the Government accept that the current legislation is now a third of a century old, and that this may be an appropriate time to review it and consider changes, but this is not the right time or place to take action. Proper consideration must be given to new legislation.

As Members will know, severance pay is governed by legislation. The statutory provision for ministerial severance pay is contained in the Ministerial and other Pensions and Salaries Act 1991. It has therefore been in place for successive Administrations, and has been paid to Members of all three parties who have made ministerial office during this period. Under the Act, Ministers who leave office are entitled to a payment equivalent to a quarter of the annual salary that they were being paid in respect of the ministerial office that they are leaving. To be eligible for a payment, they must be under a certain age—65—and must not be reappointed to ministerial office within three weeks of leaving their previous office.

I note—and I thank the right hon. Lady for drawing it to my attention—that in 2022 a small number of severance payments were made incorrectly to departing Ministers. I want to make it clear that the Cabinet Office guidance to Departments is that they should seek to recover any mispayment in line with His Majesty’s Treasury’s guidance, “Managing Public Money”. While the incorrect payments were caused by an administrative error and the former Ministers concerned were at no personal fault whatsoever, it is important that the Government seek to recover that money. I am sure I am not the only one who recalls the catastrophic overpayment of tax credits when Labour was last in office, and the fact that many families got into huge difficulties because of that. It is such a shame that the right hon. Lady was not so exercised about that when they were in office.

[Andy Slaughter (Hammersmith) (Lab)]

Will the Minister give way?

[Esther McVey]

No, because we are talking about waste. We are talking about appropriate measures taking place and this faux emergency legislation that the right hon. Lady wants to bring in.

Turning to ministerial severance pay more generally, it is important to note that this is the long-standing policy that successive Governments from both sides of the House have retained. The reason they have retained it that the principle of paying severance remains sound. The Prime Minister, in his constitutional role as a principal adviser to the sovereign, can recommend the appointment and removal of Ministers at any time. This flexibility, necessary as it is within our political system, means that having a reasonable severance pay policy to reflect the uncertain nature of ministerial office has had wide support from across the House since its introduction.

Members will be aware that similar arrangements are in place for Members of Parliament, who also hold the status of officeholder. In certain circumstances, Members of Parliament who lose a seat at a general election are eligible to receive a loss of office payment. The eligibility for the loss of office payment is determined by the Independent Parliamentary Standards Authority, which is responsible for setting and regulating MPs’ salaries, pensions, business costs and expenses. Severance payments recognise the unpredictable nature of ministerial office. The fact that a Minister can lose their office with no notice when the Government or a Prime Minister change will inevitably lead to a substantial increase in the money paid out in that financial year—

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[Anna Firth]

I totally agree with my hon. Friend. That is absolutely appalling. We also know that shamed SNP MSP, Derek Mackay, who has left office, claimed £155,000 in expenses, including, as I understand it, severance pay. The SNP approach is incredibly hypocritical.

While we were sorting out Labour’s mess, cutting our own pay and keeping it frozen, every single Labour leadership candidate in 2010 refused to hand back their taxpayer-funded severance pay, including the right hon. Member for Doncaster North (Edward Miliband) and the Mayor of Greater Manchester, both of whom were entitled to £20,000, and they still hold elected office today.

When we questioned those severance payments, given the mess that Labour had left us in, a Labour party spokesman responded by saying that it was a pathetic attempt to create a smokescreen around serious economic issues—[Laughter.] Yes. I would be grateful if those on the Labour Front-Bench team can confirm to the House today that this motion is a pathetic and hypocritical attempt to create a smokescreen around their total lack of a plan for Britain. There is no plan for the economy, no plan to tackle welfare, and no plan to deal with immigration. In fact, we know that Labour would take us right back to square one.

As usual, while the Opposition are sniping from the sidelines and making these cheap political points, we are actually getting on with the job of serious government. In the past 14 years, the Conservative party has been focusing on delivering for the people of Britain. Let me remind Labour Members what that delivery looks like: better state schools than ever before; more students securing top grades in maths, physics and chemistry—

[Andy Slaughter]

Will the hon. Lady give way?

[Anna Firth]

I am not far from finished, so I will carry on.

There are more students from state schools at our best universities. School performances are skyrocketing up the PISA tables, and we now have the best readers in the western world. We also have record employment: 4 million more people in a job than there were in 2010—that is over 800 jobs every day.

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[Andy Slaughter (Hammersmith) (Lab)]

I do not know whether I am alone in finding the contributions from those on the Government Benches rather prickly and defensive. I listened to the opening speech of the right hon. Member for Tatton (Esther McVey), the Minister for common sense, or rather the Minister for nonsense today, and not only did it not touch on the motion at all—a theme followed by almost every Conservative Member who spoke—but it was simply very poor. Maybe she wanted to show her disdain for the motion by instructing her office to draft something of that quality, but I think that is unfair, because what the shadow Attorney General and others have done in preparing for the debate is actually quite a lot of detailed work about 97 members of the Government over a relatively short period.

The motion does not propose punitive remedies. The motion would simply remove the abuses from the system. It is not against the principle of severance—rather confusingly, the shadow Attorney General has been criticised for that by Conservative Members—and it addresses specific anomalies. It addresses, first of all, a mistake. To be fair to the Government, they accept that, where a mistake has been made, the money paid in error should be refunded. I think that we can all agree on that.

The motion also addresses what has been described as the Bone-Pincher anomaly, which is where there has been clear misconduct. I think it would be quite difficult for Conservative Members to defend that behaviour. The shadow Attorney General has also identified excessive amounts of pay, which is either where the Minister has served for a short period of time, or where their salary has gone up dramatically and their severance pay is based on the end salary, which is substantially higher than what it was.

Finally, the motion addresses where a Minister has been sacked or has resigned and has received their three months’ money and then is reappointed to the same or a very similar job within those three months. In that case they should not get double bubble, as it were. This is perhaps the easiest area to understand and I cannot see any objection to any of that. It is very close to being unjust enrichment in all cases, and the remedy for that is restitution. It is to provide redress in the event that one party has received a benefit from another in circumstances where it would be unjust for the recipient to retain that benefit. The donor here is the taxpayer, and the recipient, with very little excuse, is 97 Ministers.

There have not been, as the right hon. and learned Member for Northampton North (Sir Michael Ellis) said, ad hominem attacks. Yes, of course we have to identify individual Ministers in that way, but it is the collective system that is being criticised. Some may say that 2022-23 was an exceptional year—let us see what happens this year, shall we? We might be in for another exceptional year. But even if that were an exceptional year and the sum of £1 million, which is a very large sum of money, is not repeated, there is a principle at stake here.

I could run through all 97 cases, but I could not be bothered to email all the offices in order to do that. I was already emailing the office of the right hon. Member for Chelsea and Fulham (Greg Hands) anyway, because he spends most of his time canvassing in my constituency now—at least the parts that I am transferring to him—and I spend a lot of my time canvassing in his. I thought that I would also say that I was going to mention him in this debate. It is nothing personal; it never is between neighbours in that way. None the less, his is a pretty clear case: he backed the wrong horse when the right hon. Member for South West Norfolk (Elizabeth Truss) was elected Prime Minister, so he lost his job. He got his three months’ severance, which is £7,920. And 33 days later, when the right hon. Member for South West Norfolk was already running out of friends, she reappointed him to her Government.

Under the system that the shadow Attorney General has outlined, the right hon. Member for Chelsea and Fulham would have received a severance payment of £2,886—some £5,033 less than he received. Some may say that perhaps he deserved it. I am not so sure, because what that means is that whereas for the first month, when he was out of office, he was being paid through severance, for the next two months he was being paid both his severance and his salary. He was quite literally getting double the money for that period of time. The right hon. Gentleman has not responded to me to say that he has paid that all to the local Labour party or some other deserving charitable body in the interim—[Interruption.] Not a charity in law, but a body with many charitable aspects to its operation. Perhaps he has done that. I hope that all 97 will take that course of action, and I am sure the Attorney General will be writing to them all individually to invite them to make those payments back, because that is no way to deal with public money.

I am not going to go on about the right hon. Gentleman, because I think he will be dealt with by his electorate in due course and in fairly short order, and the excellent Labour candidate for Chelsea and Fulham, Ben Coleman —many of my hon. Friends have been down to support him—will be a refreshing change as the new MP. I see the right hon. Member for Charnwood (Edward Argar), sitting on the Front Bench; he is a resident of that constituency, and is clearly considering what options he may take when he is called upon to vote.

I will conclude on this point, because it is a serious one. We should not play fast and loose with public money in that way. We should not misuse public resources, and when—even if we could say it is through no fault of our own—we are unjustly enriched in that way, we should make reparation. That is all that our motion is calling for, and I think it is difficult on that basis for Conservative Members to oppose it. We will see, when we vote in a few moments’ time, whether that is the case.

We have heard a lot of red herrings about other payments that may be made to Ministers or MPs. However, as many hon. Members have said, if we think of our own constituents and the hard times they are going through, it does make us look out of touch if we say, “Well, it’s only £5,000”—or only £25,000, in some cases—“and I’ve done a good job and worked hard.” So have my constituents, and they are not rewarded in that way. If hon. Members could focus on that for a few moments when we come to vote on the motion, I do not think they will find it difficult to vote with Labour.