Gurkha Pensions

Anna Soubry Excerpts

Thursday 11th September 2014 Commons Chamber

[Sir Gerald Howarth]

I am extremely grateful to my hon. Friend for making a very important point. Research ought to be done into the activities of some of these middlemen, who undoubtedly are in it for the money. It is they who have benefited from visiting on these people a misery they do not deserve and from which they should have been spared. I could not agree more with my hon. Friend.

In view of all the serious changes in my constituency, I had a meeting with the Prime Minister in 2011 to ask for further funding to enable the local authority and others to provide the badly needed additional support generated by the number of new Nepalese in the area. I managed to secure £1.5 million in total, which was provided by three Departments: the Ministry of Defence, the Foreign Office and the Department for International Development. Of that, about £1 million went to Rushmoor borough council.

As I have mentioned before, many of these elderly Nepalese struggle with ill health. What people might not realise is that, as well as the significant increase in the number of elderly people requiring health care at local GP surgeries, there is a huge need for Nepali-to-English translators to help explain to the doctors the needs of their patients. One doctor asked me, “How can I deal with a female patient with gynaecological problems who speaks no English and whose 12-year-old son has to translate for her?” That is wrong. Of course, this has resulted in longer patient time, so the indigenous population are having to wait longer to see their general practitioner. These are practical problems that have presented themselves, and I hope the House will recognise that that is but one of a number of hidden extra costs.

Let me turn specifically to the issue of Gurkha pensions. Until 1 July 1997, the Brigade of Gurkhas was regarded as an overseas force and its home base was in the far east; prior to Hong Kong, it had been in Singapore and Malaysia. In accordance with the tripartite agreement of 1947 between the Government of Nepal, the Government of India and the British Government, commonality was provided with respect to key service conditions such as pay and pensions, irrespective of whether they were enlisted in British or Indian armies—it is, of course, important to remember that the bulk of Nepalese recruited to the flag went to the Indian army, not the British Army.

As my hon. Friend the Member for Thurrock has said, most would serve for 15 years, following which they would be paid an immediate pension designed to provide a comfortable living in Nepal, which is where they were expected to—and virtually always did—return. Furthermore, as young men they were clearly able to take up new careers upon leaving the Army. By contrast, their British counterparts had to serve 22 years before being eligible for a pension, which became payable only at the age of 60, rather than upon immediate retirement. Thus, the Gurkhas returned to Nepal often in possession of a pension more than 25 years before their British counterparts. Over the course of a retirement, most Gurkha soldiers will receive equivalent or better value than their British counterparts as a result of being paid their pensions so much earlier. Moreover, the Ministry of Defence contributes more than £1 million a year to the Gurkha Welfare Trust in Nepal, which enables the trust to use its funds to care for the needy.

Following the return of Hong Kong to China, the Brigade of Gurkhas had to leave, naturally, and, apart from those stationed in Brunei, where the Sultan himself funds the Gurkha battalion, they moved to the United Kingdom, together with their families, meaning that their children were brought up in English schools. Thus, from 2004, those with four years or more service became entitled to apply for settlement in the United Kingdom. By 2007, those serving in the British Army were paid exactly the same as their British counter- parts.

In 2009, in response to the Lumley campaign, the then Home Secretary announced a change in policy on Gurkha settlement rights for those who had retired before 1 July 1997 and had completed four years’ service. They would have the right to settle in the UK with their spouses and dependent children. However, it is important to remember that there had been an agreement among the parties to the discussions that there was no direct read-across to policy on pensions. The then Home Secretary, Jacqui Smith, said that

“the question of equalising Gurkha pensions should not and need not be conflated with the debate about settlement”.—[Official Report, 21 May 2009; Vol. 492, c. 1650.]

The then Minister for veterans, the hon. Member for North Durham (Mr Jones)—in order to embarrass him I will place on the record that we are very good friends; that should do his career some damage, and as he is not here I can freely say that—said in a written answer that the

“estimate of the capitalised cost of providing retired Gurkhas with Armed Forces Pension Scheme (AFPS) equivalent pension benefits for all pensionable service before 1 July 1997”—[Official Report, 8 July 2009; Vol. 495, c. 789W.]

was a whopping £1.5 billion.

It is important to underline that these pension arrangements have withstood no less than three major legal challenges in the past nine years. The three judicial reviews found the pension arrangements for Gurkhas to be fair and reasonable.

There has been much debate and controversy over the decision to build the changes around the date of 1 July 1997. However, given that was the date the UK became the home base for the Gurkhas, together with changes to immigration rules, which were updated to 1 July 1997, there was an increasing probability that Gurkhas would seek to retire to the UK on discharge. Up until that point, it was accepted that Gurkhas would be recruited in Nepal as Nepalese citizens, serve as Nepalese citizens and be discharged as Nepalese citizens in Nepal. However, given the change in their home base from Hong Kong to the UK, that could no longer be fairly assumed to be the case.

In his judgment of 2008, Mr Justice Ouseley said:

“A line was drawn; that was in itself reasonable, and the particular dates chosen for its drawing are reasonable too. The difference reflects not age in reality but the number of years of service based in the Far East or in the UK. If there was indirect discrimination on the grounds of age of ‘other status’, it was justified and proportionate.”

The Court of Appeal upheld the January 2010 ruling, which comprehensively rejected the argument that Gurkha pension arrangements were irrational, unfair or discriminatory. However, the legal process continues and the judgment remains the subject of an appeal to the European Court of Human Rights.

I have every sympathy with the British Gurkha Welfare Society. It is a vibrant organisation and is well led by my friend, Major Tikendra Dewan, but as a former Defence Minister and having considered the matter carefully, I cannot support this campaign. The guys at BGWS are doing a great job. They are entrepreneurial and have their own energy company—I hope to sign up to their energy provision—whose new office will be officially inaugurated by the new Minister, the Under-Secretary of State for Energy and Climate Change, my hon. Friend the Member for Hastings and Rye (Amber Rudd). They also have a radio station. They are a great organisation. Like my hon. Friend the Member for Thurrock, however, I do not think that there can be a retrospective change, and I salute her for having the courage and honesty to say so. The Ministry of Defence does not have £1.5 billion to pay up. No doubt the Minister will nod.

[The Minister of State, Ministry of Defence (Anna Soubry)]

indicated assent.

[Sir Gerald Howarth]

For the sake of the record, the Minister has nodded. Such treatment would not be fair, as the Forces Pension Society has a number of other claims for the correction of past anomalies that the Ministry of Defence has consistently resisted. The Department has been subjected to no fewer than three legal challenges, all of which have been rejected, so it has neither been capricious nor discriminatory.

Those who took advantage of the right to settle here knew very well the terms on which the offer was made. If they were misled, as my hon. Friend the Member for Thurrock suggested—and I think that she is right—that was not the fault of the British Government. Furthermore, although they receive no uplift in their pensions, they receive a range of benefits designed to help them, as she said. They also have access to the best free health care facilities and support from a range of organisations.

Of course, as my hon. Friend said, there is an argument that as such welfare benefit costs are themselves substantial, why not therefore just increase the pensions, because the overall cost to the British Government would not change? That may or may not be true, but it would undoubtedly be a magnet for further migration, and without a policy of dispersing new arrivals, the burden would unquestionably fall on Aldershot. If any measure is to be taken, perhaps our bloated overseas aid budget could come to the rescue and be used to provide new health facilities in Nepal. My hon. Friend’s idea of an endowment for the Gurkha Welfare Trust is a good one. She has come up with some very practical suggestions, for which I salute her.

I want to end on a positive note. The changes inflicted on my constituency have been massive, but thanks in part to the Prime Minister’s intervention, which resulted in the additional £1.5 million of funding, and in large measure to the unremitting efforts of Conservative Rushmoor borough council—so ably led by its leader, Councillor Peter Moyle, and by its remarkable chief executive, Andrew Lloyd—early problems have been addressed by a raft of initiatives aimed at securing social cohesion.

Although there were undoubtedly problems initially, particularly among the younger, newly arrived Nepalese—not, of course, those who served in the Army—we have seen Nepali groups and white groups playing football, and a fantastic effort has been made across Rushmoor to integrate; and it is working, and has done well. This is my plea: those who have come here are, of course, welcome and we will do what we can for them, but I cannot in all conscience stand in the way of my constituents, some of whom have chosen to leave Aldershot because they are distressed at how their town has changed, or do other than to stand up for them. However, the good news is that the initiatives taken have resulted in a much greater degree of social cohesion, and I hope that we will continue to move in that direction of travel.

--- Later in debate ---

[The Minister of State, Ministry of Defence (Anna Soubry)]

I thank the Backbench Business Committee for ensuring that the debate has come into this place. I also want to pay particular tribute to my hon. Friend the Member for Thurrock (Jackie Doyle-Price). It is important that I set the record straight regarding certain comments by my hon. Friend the Member for Reading East (Mr Wilson), of whom I make no criticism. There might have been a suggestion, given the note from my hon. Friend the Member for Thurrock that he described, that she had been reluctant to take on this task, but that is not the case. As chair of the all-party parliamentary group on Gurkha welfare, she took on the task, with absolutely no support other than from fellow members of the group, knowing that it would be hugely complex and emotive. As has been mentioned, she has had support from my hon. Friend the Member for Folkestone and Hythe (Damian Collins) and other members of his team.

We have heard some great speeches this afternoon. During the debate—I hope Members will forgive me—I was talking to the Solicitor-General, my hon. and learned Friend the Member for South Swindon (Mr Buckland), and we were trying to recall whether an all-party group had ever taken on such a task without the support of any charity or industry. This might be a bit of a first. I do not know; it does not matter. The point is that they have done it, and we look forward to the report.

I do not hesitate to tell the House that I agree with almost everything that my hon. Friend—as she now is, on this point—the Member for Plymouth, Moor View (Alison Seabeck) said. She commented on the absence of Labour Members from the Chamber today; indeed, the same applies to my side of the Chamber to some extent. It is important for people to understand that that is not a reflection of any lack of interest in this important matter. Perhaps the public at large do not appreciate that Members of Parliament do not have to be in the Chamber to take a firm interest in a debate. They can watch it in their rooms, but in any event they will read it in Hansard, either electronically or on paper. I know that that will happen.

The biggest tribute that I want to pay today is to every member of the Gurkha community and, in particular, to all those who have served. They rightly deserve their reputation as being among the bravest and most fearless of soldiers. It was one of my great pleasures, honours and treats to go along to their regimental dinner earlier in the summer. I watched as they drilled and marched as the band played, and it was fabulous. I have never experienced anything like it. Those are perhaps the exterior things, the extra bits, but at the heart of the matter is their reputation for courage. It is often said that they are the most fearless of soldiers. Next year, the Gurkhas will celebrate 200 years of service to the Crown, and we look forward to the celebrations and commemorations. The United Kingdom—let us hope that it remains the United Kingdom—is proud of the Gurkhas, and we have always sought to meet the aspirations of successive generations of Gurkha soldiers and their families. I should like to put that into the context of the subject of the debate.

In 2009, our appreciation of the Gurkhas culminated in Parliament’s decision to permit Gurkhas discharged before 1 July 1997 to settle here in the United Kingdom. Many retired Gurkhas have since done so, and many have received vital welfare support and medical treatment as a result. However, as we have heard today, those settling here also became aware of differences between Gurkha terms and conditions and those of the rest of our armed forces. In particular, as many speakers have mentioned, they have highlighted the difference between a Gurkha pension pre-1997 and that of their British counterparts. Suffice it to say, these are complex issues, rooted in a set of unique historical and political circumstances, but context is all and I am grateful for the opportunity to set out the Government’s position. Of course we welcome the report and I assure hon. Members that it will be read and analysed, and all points will be considered. Most importantly, my door will be open to my hon. Friend the Member for Thurrock and to other hon. Members who have served so well on her all-party group.

The Government’s view is that the Gurkha pension, established in 1947 by the tripartite agreement between the UK, Nepal and India, was fair for the time and did not disadvantage Gurkhas. There are three reasons why I say that. First, although the Gurkha pension was smaller, it was paid for a much longer period. Gurkhas received an immediate pension after 15 years’ service, typically in their early 30s. By contrast, British personnel who served less than 22 years prior to 1975 receive no pension. A calculation made in 2009 showed that a Gurkha rifleman who retired in 1994 will have received some £61,000 at 2009 prices by the age of 60—his British comparator will have received nothing at all.

Secondly, the Gurkha pension placed Gurkhas among Nepal’s highest earners as a result. Significantly, a retired Lieutenant—a Queen’s Gurkha officer—with 24 years of service receives a pension more generous than the salary of Nepal’s Prime Minister. Thirdly, over the years Gurkhas’ pensions evolved as they benefited from the flexibility built into their terms and conditions. That meant that we were able to enhance their pensions to suit changing circumstances. Initially, as we have heard, Gurkhas mainly served in the far east, but when they undertook temporary posting to the UK or other overseas locations they were entitled to a cost of living addition. From 1997, when Gurkhas were based in the UK, they received a universal addition regardless of where they then served. Since 2007 Gurkhas joining our armed forces have been placed on an equal footing with the rest of the Army.

The argument has been made by others, and it is the right argument, that all those who receive a pension are bound by the rules of the game. Those who did not serve the requisite period of time or who came to this country on a pre-1997 pension cannot expect their pension arrangements to change. I should add that it would be the same in the case of a British soldier. The legal principle that individuals receive benefits in accordance with the scheme rules is well founded. As we heard, retrospective changes are not good and cannot be right—as is the principle, upheld by successive Governments, that improvements to pensions schemes are not made retrospectively. There are many quotes on that from previous Ministers of State for the Armed Forces and Ministers in my position. All of them, whatever the colour of the Government, support that important principle.

However, decisions can be reviewed in circumstances where incorrect information was provided to individuals. We have heard about the ramifications of mixed marriage, which make for uncomfortable listening in our, happily, more enlightened age. I want to know more about any Gurkha who finds himself in that situation. I want to know the detail, to have those cases placed before me and to get those things sorted out. I find the fact that Gurkhas were given dummy national insurance numbers utterly bizarre, and my hon. and learned Friend the Solicitor-General and I were debating it. It is almost as if money were obtained by some deception, in that people were paying in money but they have had no benefit from it. Again, I make no promises, but that cannot be right and we need to sort that out. My door is open and I want to have proper discussions about how we can do that.

That brings me back to the first speech in this excellent debate. My hon. Friend the Member for Thurrock spoke about fairness. This is about fairness, but it is also about having a mature dialogue. I listened with great care to the points that she so ably advanced, and to the points that were taken up by others. I will, if I may, respond to some of them now.

My hon. Friends the Members for Aldershot (Sir Gerald Howarth) and for Thurrock talked about the role of some sort of middleman. I always shy away from making adverse comments about lawyers, as I was a lawyer in a previous life. In all seriousness, I am concerned that there might be individuals who seek to exploit Gurkhas, or ex-Gurkhas, in Nepal. I will ask my officials both in the United Kingdom and in the embassy in Nepal to explore that matter so that we do all we can to ensure that that those who wish to come to the United Kingdom are not only fully and properly informed but not in any way exploited.

My hon. Friend the Member for Reading East made a point about the Department for International Development, which was taken up by others. Let me just say this: DFID has been investing in the health sector in Nepal for nearly 17 years; it has contributed more than £19.7 million to the rural water and sanitation programme of the Gurkha welfare scheme since 1989. In addition, its operational plan commits up to £331 million of UK official development assistance during the period of 2011 to 2015. The DFID Nepal programme now totals around £90 million to £100 million per annum. I hope that my hon. Friend finds that helpful and useful.

My hon. Friend the Member for Folkestone and Hythe gave a well crafted speech, which made some very good points. The great work of the Gurkha Welfare Trust was mentioned. It was suggested that a boost in LIBOR funds could be a way to solve some of these feelings of injustice and unfairness and, most importantly, these feelings that a need is not being met.

I am grateful to all Members for their comments, including my hon. Friend the Member for Brecon and Radnorshire (Roger Williams). In relation to his point about funding, which my hon. Friend the Member for Aldershot says has benefited his constituency, I am helpfully advised by my officials and by my hon. and learned Friend the Solicitor-General that that £1.5 million funding is available for Gurkhas in his constituency. I would be more than happy to meet my hon. Friend the Member for Brecon and Radnorshire to talk about how we can ensure that his constituents benefit.

Joanna Lumley’s campaign has been mentioned. I am aware of the comments of my hon. Friends the Members for Aldershot and for Chatham and Aylesford (Tracey Crouch). Let me say this, if I may: Joanna Lumley’s campaign had the highest and most honourable of motives. It was welcomed and it was the right thing to do. None the less, I accept the comments of my hon. Friend the Member for Aldershot, who said that there have been some unintended consequences.

[Sir Gerald Howarth]

It is important that the House understands that those consequences were not entirely unforeseen. At the time, I suggested that there were potential consequences by virtue of the fact that Aldershot has an historic association with the Gurkha community. I would not like it to be thought that somehow this has all suddenly come upon us without any warning.

[Anna Soubry]

I am grateful to my hon. Friend for the comment, but I would counter it by saying that we are where we are. We have to deal with the reality of where we are and see whether we can make things considerably better for those who find themselves away from home, struggling to speak English and in the circumstances described, while ensuring that their welfare is an absolute priority. Those things must be done as we take these matters into consideration.

In conclusion, we believe that the terms and conditions of the Gurkhas were fair but, having said that, we also understand the concerns of those who, having fought for this country, settled here and subsequently found themselves in difficulty. That is why we are so grateful to all those who have participated in the inquiry and we look forward to the report’s conclusions. Its focus has been on resolving historical anomalies and that must be right.

Today’s Gurkhas, in terms of engagement, pay, allowances and pension matters, are regarded no differently from personnel in any other part of the Army. Again, I thank all who have taken part in the debate and in the inquiry and we look forward to the report.