Devolution (Implications for England)
Brian H. Donohoe Excerpts(10 years ago)
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Mr Hague
I think that many of the cities and regions know best, which is why we are giving them more powers and responsibilities. That is what we are seeing with the agreement with Manchester and the prospect of equivalent deals in many other parts of the country. We are trying to ensure that there is much more local decision making across the cities and regions of the country, in place of decision-making here.
Mr Brian H. Donohoe (Central Ayrshire) (Lab)
The Leader of the House came here in 1989, and I came in 1992, and during my 22 years here this place has been full of anomalies. Only yesterday I was told by the hon. Member for Mid Bedfordshire (Nadine Dorries):
“This has nothing to do with firefighters in Scotland”.—[Official Report, 15 December 2014; Vol. 589, c. 1157.]
But the debate had everything to do with Scotland, as a consequence of the fact that the Scottish nationalists introduced only part of the deal required by firefighters. On that basis, is it not true that we will now have, as a result of his proposals, second-class MPs in Scotland?
Mr Hague
The hon. Gentleman is quite right that there are many anomalies in how we do things in this House, although the injustice for the voters of England is now sufficiently great to be considered more than an anomaly. When it comes to deciding who votes on matters in other parts of the United Kingdom, it is English Members of Parliament who feel that they are second class. That is why we must deal with the issue. Otherwise, it will damage this Parliament and damage the United Kingdom.
Devolution (Scotland Referendum)
Brian H. Donohoe Excerpts(10 years, 2 months ago)
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Mr Tom Clarke (Coatbridge, Chryston and Bellshill) (Lab)
Tempting though it is, I shall not rehearse the arguments we heard again and again during the referendum campaign. Instead, I shall address the issues arising out of the vote on 18 September, bearing it in mind that a clear majority of the people of Scotland voted to remain in the United Kingdom, but not ignoring the 45% who took a different view, some of them, I have to concede, in my own constituency. Given the passion of the campaign—that is putting it politely; some of the events I observed in my constituency are perhaps best forgotten—I appeal to SNP Members to accept that the Scottish people have taken a clear decision to remain part of the UK. It is right that the House respects their decision.
It was accepted in the Edinburgh agreement, however, that there would be changes. I do not object to it; John Smith himself regarded devolution as an evolutionary process. It is right, therefore, as the right hon. and learned Member for North East Fife (Sir Menzies Campbell) observed, and given the approach to devolution, the setting up of the convention and so on—
Mr Brian H. Donohoe (Central Ayrshire) (Lab)
Devolution was not supposed to end at the front door of the Scottish Parliament; it was supposed to be passed down to local authorities. Does my right hon. Friend agree that one of the worst decisions made by the Scottish Executive was the decision to freeze council tax, which meant that, for instance, disabled children did not receive the services that they should have received, and need?
Mr Clarke
I absolutely agree. Let me say, as a former president of the Convention of Scottish Local Authorities, that I would never have agreed to the freezing of council tax. It meant that council services were cut, and, during the referendum campaign, it was used against those who were in favour of supporting this United Kingdom and was cited as a reason for voting yes. I should have liked to deal in some detail with the issue of disability, which my hon. Friend rightly mentioned, but I think that the House has heard from me on that issue before. I do not think that it was dealt with very well by the Scottish Government.
A vow was given to the Scottish people. That vow was clearly endorsed by the leaders of the various parties, and I am convinced that it will be kept. I am not sceptical. However—I say this with all candour, and with great respect to Government Members—if there is any suggestion that the vow will not be kept, they will put the future of the United Kingdom at risk. I know that that would delight the Scottish National party. That is why, for example, they have today made it clear that they welcome what are described as English votes for English laws.
I speak as one who fought for the United Kingdom, and fought for the right of this Parliament to remain, dealing with the powers that it has. Incidentally, every single one of the powers for the people of Scotland that were mentioned by the right hon. Member for North West Hampshire (Sir George Young)—who has now left the Chamber—was decided by this House. I ask my friends in the Scottish National party to understand that when we recognise, quite correctly, that there are implications for the rest of the United Kingdom, it should be remembered that we did what we did because we believe in this United Kingdom Parliament. In the days of the constitutional convention, discussions took place in Scotland—not for weeks, not for months, not for years, but for a very long time—during the preparations for the legislation that led to the Scottish Parliament.
For that reason—again, with great respect—I ask two things of Government Members. First, I ask them not to rush into conclusions on the basis of the results of recent elections. My own view of UKIP is that it will come and go. Some of the issues that influenced people in England to vote for UKIP were, I concede, also issues in my constituency. People there decided to vote yes because they were worried about Westminster. The perception of this Parliament is, to say the least, not good. That does not mean that it is our fault. A very small number of Members brought this place into disrepute, but, my heavens, was that not exploited in the referendum! It is no surprise that the White Paper referred again and again to the “Scottish Government” and “Westminster”.
Secondly, let me say this in particular to Government Members. I understand their right, their absolute right, to feel that they should bridge the gap between Westminster—this Parliament—and the people whom they represent, not least because I believe that the concerns that they express on behalf of their constituents are largely shared by mine.
Let me end by saying that last night I listened to a very interesting Adjournment debate. I pay tribute to the hon. Member for Isle of Wight (Mr Turner): he made an excellent case against increased ferry charges. However, he also chose to attack Scotland by saying that CalMac services were receiving grants that could not really be justified. Time does not allow me to go into detail, but the truth is that there is a big contrast between the Isle of Wight and here, and the many islands served by CalMac. There are many arguments for doing what we are doing. I believe that one of the biggest influences in the vote in Scotland, accepting the majority view, is that people were worried about Westminster, people were worried about poverty, and they expect us to respond to their concerns.
Transparency of Lobbying, Non-Party Campaigning and Trade Union Administration Bill
Brian H. Donohoe Excerpts(11 years, 3 months ago)
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Mrs Anne McGuire (Stirling) (Lab)
It is a pleasure to follow the hon. Member for Banff and Buchan (Dr Whiteford). I echo her comments about the denial on the Government Benches that the Bill will be restrictive. One has only to look at clause 26, and even the explanatory notes by implication identify that the Bill will be restrictive, because the Government are extending and broadening types of expenditure that can be regulated. The most damning comment in the explanatory notes is this one:
“regardless of whether those incurring the expenditure intended it (or also intended it) for another purpose.”
Therefore, a small local charity’s campaign on a local issue could be taken up by a candidate in a general election, but before we can say, “Bob’s your uncle,” the charity finds itself in breach of the legislation.
Like many other hon. Members, I spent a great deal of my working life before I became an MP in the voluntary sector. I was the deputy director Scottish Council for Voluntary Organisations. With the greatest respect to the Deputy Leader of the House, who will wind up the debate for the Government, the Bill, and certainly part 2, is predicated on a misunderstanding of the role of charities in our society. There has hardly been a piece of social legislation in the past 150 years that has not had the involvement of charities or voluntary sector organisations. Some of the pressure and some of the great reforms have come from charities. I fear that the Bill reveals the Government’s tunnel vision about what charities and voluntary sector organisations are about. And we should make the distinction between charities and voluntary organisations, which are not always exactly the same.
The big society seems to be about services, not involvement in public debate. If the Government really believe in a big society, they should be encouraging charities and voluntary organisations to be involved in our public discourse. There is sometimes an arrogance among full-time politicians. They assume that they are the only people who are interested in politics, that somehow politics is our particular preserve. The reality is that civic society has proved, over many years, that it has a significant role to play in our public discourse.
Independence is crucial to the voluntary sector. I was astonished to hear the hon. Member for North East Somerset (Jacob Rees-Mogg) imply that because the National Council for Voluntary Organisations takes money from Government, it should not be independent and should not be allowed to express the opinions it wants to express.
Mr Brian H. Donohoe (Central Ayrshire) (Lab)
May I ask one question about my right hon. Friend’s position, and the position of any Member standing at the next general election? When a charity turns up at a hustings and issues leaflets, that will become illegal. How, in those circumstances, will a candidate get to know about that charity and take forward its work?
Mrs McGuire
The other thing that is even more disturbing is that if my hon. Friend happens to say that he supports a particular charity and something it is promoting, and the charity happens to put that on a leaflet, along with perhaps three of the four or five other candidates, it might find itself in the same position. The alternative to that is that it may well just put out a list of people who support their objectives. It is just a nonsense and a mishmash. I am frankly astonished that the Liberal Democrats, who made and built up their reputation as community activists, are going along with this proposed legislation. [Interruption.] The Deputy Leader of the House can sneer all he likes. This is denying the heritage of the Liberal Democrats, who were forever telling us they were community politicians.
General Matters
Brian H. Donohoe Excerpts(12 years, 5 months ago)
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Mr Donohoe
Apprenticeships are dear to my heart, but not enough is being done. Is the college that the hon. Gentleman mentioned going to increase the number of apprenticeships it provides?
Mr Turner
It is necessary that apprenticeships be expanded at all levels, which is why I am glad that my hon. Friend the Minister is visiting. I look forward to it.
One positive way of gaining experience while looking for employment is voluntary work, and there are many excellent causes on the island. For example, the Isle of Wight food bank, which has been doing a sterling job since its launch a year ago, has helped more than 2,000 people in dire straits by providing food donated by other islanders. I pay tribute to Hannah King, who runs the food bank, and all her volunteers for the sterling work they do.
Finally, I want to touch on events that brought parts of the island to a standstill for more than 24 hours last month. Many hon. Members will have seen the headlines about the Isle of Wight festival chaos. The festival has been held in its present location since 2002, but owing to atrocious weather and a clear lack of contingency planning, some island roads were gridlocked on 28 and 29 June. The impact on some islanders’ lives was very serious. Vehicles were at a standstill for hours, blocking roads and preventing islanders from getting to work, school, hospital appointments and the ferry terminals, while ferries sat in the Solent for up to five hours, unable to unload cars; there was nowhere for them to go. School children missed important exams, and others walked home when there were no buses. Some families were unable to get to the funerals of relatives, and other funerals were cancelled.
It is not for me to apportion blame, but a bad situation was certainly made much worse by a lack of communication with the island’s media. For example, Michael Coombes and Paul Topping, along with Heather McCallum, Glyn Taylor and Lucy Morgan of Isle of Wight Radio, worked tirelessly to try to keep islanders abreast of events. However, their efforts were largely thwarted, because nobody would tell them what was going on. Thankfully, the situation was finally brought under control on the Friday morning, when alternative car parks were opened. Many islanders showed amazing community spirit, offering food, shelter and other help to stranded festival goers. That included the Vectis 4x4 responders. Without their help, vehicles would have been stuck in the mud bath that was the festival car park for many more hours.
In order to ensure that such problems do not arise again, we need to know what went wrong this year. The organisers, Solo, are not covering themselves in glory. First it was announced that refunds would be given; then Solo said that they would not. I know that VentnorBlog has asked Solo a number of times for a copy of the emergency safety plan, but those requests have been ignored. Solo may not feel accountable to local people or our local media, but without local good will the festival will be harder to stage. I want the festival to continue—so do many others on the island and, of course, off it—but Solo must ensure that local people are able to go about their lives around it. Then we will all benefit again.
Roberta Blackman-Woods (City of Durham) (Lab)
I want to use this afternoon’s debate to put down a marker of my concern about the changes in Government policy towards further education and the introduction of further education loans, and also about the possible impact of changes to higher education funding on social mobility. I am particularly concerned that the introduction of further education loans will discourage people from disadvantaged backgrounds from taking up access courses to university or, if they are over 24, from entering FE to undertake level 3 study.
A couple of years ago I visited a school in my constituency which some years previously had had poor attainment levels. Because of the investment by the last Labour Government, it had massively increased its levels of success at GCSE and A-level; hence, for the first time ever, a lot of the young people there were considering going to university. However, I had a conversation a couple of weeks ago with a group of young people from the same school who were just not so sure that going to university was a possible way forward for them. That should be a matter of great concern to this House.
Last month I attended, as I do every year, the New College Durham graduation ceremony in my constituency. The students at New College range from 16-year-old school leavers to adults with families who have gone back into education, often after losing their jobs. I congratulated them on doing the right thing—on getting a good education and working hard—and I wished them all the best for the future. However, I am concerned that introducing further education loans may reduce the number of such people in colleges across the country who are getting the education they deserve, gaining the skills for a new career or accessing higher education. In 2010-11, more than 370,000 people aged over 24 were studying at this level, so the change will not affect just a small number. The people in FE want to reskill, but they also want to get promotion or enter employment for the first time. We are risking our economy and our future economic growth by not encouraging that group of people to reskill.
Mr Donohoe
Does my hon. Friend agree that much more emphasis should be placed on apprenticeships, which I mentioned earlier in the debate, by the colleges themselves?
Roberta Blackman-Woods
My hon. Friend makes a useful point. We need apprenticeships, but it is important that people—especially those aged over 24—are able to take up those apprenticeships. We also need to support the 16 to 24-year-olds in apprenticeships, as that is yet another route by which they can gain skills and get into the labour market.
Projections predict that, by 2020, 56% of jobs will need to be graduate level jobs in order to meet the demands of a knowledge-based economy. It is vital that people from all backgrounds are able to get the necessary education to get those graduate level jobs. The Liberal Democrat peer Baroness Sharp of Guildford has recognised that the introduction of further education loans threatens social mobility, saying that she cannot understand why the Government are pushing forward with loans for level 3 study while they claim to be concerned about social mobility. I ask the Minister to comment on that point today.
In my constituency in Durham, there has been a 355% increase between May 2011 and May 2012 in the number of people who have been claiming jobseeker’s allowance for 12 months. If those people want to get an education, start a new career and get out of the trap of unemployment, we need to ensure that they have access to the necessary education. A survey conducted by the Department for Business, Innovation and Skills has found that the proportion of people surveyed who were willing to take out a loan for further education has dropped dramatically for higher age cohorts. Worryingly, that suggests that the policy could do real damage to the lifelong learning sector and to the ability of people to retrain and reskill in their 40s and 50s, which could block their chances of regaining employment.
The importance of further education can really be seen at the moment, with so many people unemployed right across the country, but even in the good times we need people to be able to gain skills in certain industries to maintain our global competitiveness. In 2006, the Leitch report called for the continued upskilling of Britain’s population, but the Government are failing to implement those proposals.
I also want to consider what is happening in the higher education sector. About 70% of those enrolling in higher education access courses are women. I know from a recent letter from the Minister for Further Education, Skills and Lifelong Learning that people who undertake access courses and get into university will have the money that they spend on those courses refunded, but we must also take into account the deterrent effect that having to take out a loan could have on people enrolling in access courses in the first place. I am also worried that the number of applications to universities for courses starting in 2012 has reduced dramatically. That might not follow through to a reduction in the number of students going to university, but we should be worried by the fall in applications.
Finally, I want to make a plea to the Government to keep supporting the widening of access to our universities. We know that they have allocated £140 million this year for widening participation, but it is essential that those funds should be not only maintained but increased so that education can fulfil its role as a route to social mobility.
Parliamentary Contributory Pension Fund
Brian H. Donohoe Excerpts(13 years, 2 months ago)
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Sir George Young
It would be quite wrong to say that, in principle, our pay should be determined by IPSA but to try, by the back door, to circumscribe that decision by voting down the money it had determined should be paid as our salaries. That would not be an independent determination of our salaries.
Mr Donohoe
May I ask why the motion does exactly what the right hon. Gentleman is saying?
Sir George Young
I am not sure that I follow the hon. Gentleman. The motion transfers responsibility for determining MPs’ pensions to IPSA and delivers a commitment made in the Parliamentary Standards Act and the CRAG Act, which I believe were passed without dissent in the previous Parliament.
Mr Donohoe
The second part of the motion does the exact opposite. The Leader of the House is trying to suggest that the independent IPSA should take on board what he proposes in the motion, which is that the contributions made by Members of Parliament should increase in line with those of people in the public sector.
Sir George Young
I am grateful to the hon. Gentleman for clarifying his point. If he looks at the legislation, he will see that he and the House are statutory consultees for IPSA: if it wishes to make any changes to the scheme, it is obliged to consult the trustees, the Senior Salaries Review Body and anyone who might be affected, which includes all of us in this Chamber. We therefore have some locus in the consultation. The second part of the motion expresses a view on behalf of the House, which we are entitled to do under the legislation. It is right that Members make it clear to their constituents that they expect to be treated no differently from others in the public sector in the determination of their pension contributions.
Mr Brian H. Donohoe (Central Ayrshire) (Lab)
As the chairman of the pension fund, I have had many meetings with the Leader of the House and with the chairman of IPSA. As a consequence of my concerns and those that other trustees had expressed, I wrote to every Member of Parliament. They should have received the letter on Thursday by e-mail and over the weekend by post. I presume that, as a consequence, much that I would have said does not need to be said, but I can assure all Members and former Members that I and the trustees will take on board any observations and questions that they may have.
I would argue that we are where we are today as a consequence of successive Governments, since time immemorial, interfering with MPs’ conditions of service. That is the whole reason for this debate today and why IPSA was introduced. On that basis, it seems strange that even at this late stage, the Government continue to think they can interfere with our conditions of service by putting motions such as this before the House. I reject their position and do not think it is right.
I believe that, having been given its new responsibility, IPSA should be fully independent. It is proving itself to be so in the discussions that I have with it. It has assured the board of trustees that it will operate free of Government interference on this subject and on conditions of service across the board.
Bob Russell
Will the hon. Gentleman clarify precisely what he has been promised and who promised it to him? Is it in writing?
Mr Donohoe
What has been suggested is in the minutes of the board of trustees, and it is open to the hon. Gentleman to ask for a copy of them. He will see the discussions that have taken place.
Mr Donohoe
I do not have time to give way again, because I am conscious of the fact that so many Members want to intervene or make speeches. Rather than reading out the minutes of meetings, if the hon. Gentleman writes to me I will furnish him with that information.
Mr Donohoe
I will give way to the right hon. Gentleman if I get to a point at which I have some leeway, but I have some important things to outline before I take any further interventions.
The trustees of the time had no choice about the move to IPSA, which was agreed by a motion of the House. However, they fought for and won significant concessions within the Bill that made the change. There is absolutely no doubt that the protection of Members’ pensions was at the forefront of their discussion, and I have to praise the staff and advisers of the pension unit and its previous chairman, Sir John Butterfill. They are to be congratulated on the protection that they got for the pensions of Members and retired Members.
The legislation necessary to transfer the Leader of the House’s powers to IPSA was in place before my appointment as chairman of the board of trustees, but as I continue I shall tell the House that the trustees will have important powers that they did not have previously. The transfer of powers was agreed, as all hon. Members will know, in the wake of the expenses scandal, following the recommendations of the Kelly report. One recommendation was that IPSA should have statutory responsibility for setting Members’ pay, which of course includes pensions, and other conditions of service. It is important to understand that that must be done in consultation with the House. IPSA also has the responsibility of oversight for the administration of Members’ pensions.
Therefore, amendments to schedule 6 to the Constitutional Reform and Governance Act 2010 were made to give effect to the decision to transfer powers over pensions. That is what the Act was all about, and that is what it achieves. However, Members who read the Act will find that aspects of it clearly transfer more powers to the board of trustees.
Mr Redwood
Will the hon. Gentleman make that clear, because I do not quite understand him? Is he saying that the trustees have the power and the duty either to consent to IPSA proposals or to withhold their consent? If they have that power, how might they use it?
Mr Donohoe
The trustees do not have that power. Given IPSA’s independence, which is enshrined in legislation, at the end of the day, it makes the ultimate decision, but it must do so after meaningful consultation with the trustees. Any changes that IPSA wishes to make to the pension fund must be reported to the Speaker and laid before the House. That is the power within the Act.
The trustees at the time were presented with the proposals to amend the 2010 Act. They asked for and got a number of amendments, but they had no power to overturn the Government’s proposals, which were eventually agreed. I can tell the House that the trustees made an exceptional effort and fought extremely hard in that period, and they won numerous and significant protections for Members’ pension benefits. By way of an example, accrued benefits will be fully protected after the transfer. Because the benefits have been built up, they obviously must be protected, but they are not currently protected and they could be interfered with. That is a clear indication of what the trustees were able to implement—that protection will be enshrined in legislation following the transfer. I do not have time to give more examples, but I can give them to hon. Members after the debate if they want me to.
IPSA can make changes to MPs’ future pension benefits and contributions only after formal consultation with the trustees, the majority of whom, following the transfer of the power, which will happen whenever the Leader of the House gets round to signing the order, will be Members of Parliament or former Members of Parliament. That is an enhancement of the trustees’ powers, because there is currently no such requirement.
Currently, there are 10 trustees—eight are Members of Parliament and two are former Members, but when the order is signed, one trustee will be appointed by the board of IPSA and one will come from the Government. The Ministry for the civil service, the head of which is the Prime Minister, will appoint the latter. I do not suppose the Prime Minister wants to become the trustee of the Members’ pension fund, but who knows?
Mr Donohoe
I will explain. That individual would be responsible only for representing the Ministers’ section of the pension fund. A former Minister would have a different contribution rate. I see the Leader of the House agreeing with me on this. The pension fund administers that at present and will continue to do so, but by virtue of the contribution, it will come from the Department that the person was in or from the civil service. The Government are not going to start playing a part in the Members’ pension fund. I hope that that answers the hon. Gentleman’s question.
There was originally a proposal in the Bill that members of the board of trustees could be removed by IPSA. That has now been forgotten, and the eight members of the board will continue to be appointed by this House and no one else. They will continue to be elected or selected from this place or from among former Members. At our trustees’ meeting on Thursday, we thought it sensible to determine that we would lose two members at this stage so that this whole process could be carried out smoothly. Otherwise, all sorts of complications could have arisen. As a consequence, I would like to put on record my appreciation—and that of the other members of the board—for my hon. Friend the Member for Lewisham West and Penge (Jim Dowd) and the hon. Member for Watford (Richard Harrington), both of whom have now withdrawn as trustees.
The increase in contributions is the main point of any argument on this matter. I have already argued, and I want to reinforce the point, that IPSA must be seen in every respect as independent. I see no reason why the House should indicate that it would like our pension contributions to be treated in the same way as those of other public service workers. IPSA has a statutory duty to act independently of Parliament, and by giving such an indication, the House is putting undue pressure on IPSA. It should not be influencing IPSA in that way. IPSA must undertake its role as laid down in statute, and in no other way.
Jo Swinson (East Dunbartonshire) (LD)
Surely it is important, however, for the House to make it clear that MPs should not be treated differently from other public sector workers. In particular, we should try to avoid a repeat of the bizarre situation earlier this year in which we had to take back powers to set our own pay because the Senior Salaries Review Body had recommended a pay rise for MPs in a year when the rest of the public sector faced a pay freeze. Any such pay rise would have been entirely inappropriate.
Mr Donohoe
I have to disagree with the hon. Lady, and I will tell her why. If we put things out to independent arbiters such as the Senior Salaries Review Body, and they make recommendations after consultation with all sorts of bodies, I would argue that the Government should not intervene. In that case in particular, we should not have overturned that decision. This is where we have gone wrong so many times in the past. In the great number of years that I have been a Member of Parliament, I have seen this happen time and again, and my research leads me to believe that every Prime Minister since 1945 with the exception of John Major has interfered in the conditions of service of Members of Parliament to the detriment of those conditions.
I feel strongly about this—so strongly that, as the arch-enemy of IPSA, I argue on the basis of what I have seen that it is far better for it to have that independence, which is clearly documented in legislation, than to have this constant interference in the conditions of service of Members of Parliament. There has not been a great understanding by the Government of some of the elements of the arguments with IPSA.
Given that pay and pensions are linked, it is only sensible for IPSA to take stock not only of all elements of conditions of service, but of the whole question of pensions, which I have always believed to be deferred income for any individual in employment who has a pension fund.
Other considerations relating to IPSA in consultation with trustees include the fact that it has to wait for a valuation. Here, as I say, the Government have not fully understood the position on Members’ pensions or the calculations of where they should go in respect of any increase in contributions, any increase in the age of retirement or any other element affecting those pensions. Clearly, the results of the 2011 valuation of the scheme will shortly be finalised, which I take as a very strong argument for leaving the decision about increases in contributions, if there are to be increases, to IPSA itself. As far as we are concerned, we are in a cost-sharing scheme, as a result of which we must see what the actuary says about any changes to contribution rates before taking a decision that puts us in line with anybody else. As Members will know, there have been increases to pension contributions over a relatively recent period, which I do not think any other members of the public sector have had to face. I suggest that it is important to take that into account, as we are told it will be by IPSA.
I suggest that trustees would also recommend giving further thought to other cost-saving measures in the scheme to make it simpler and to make the benefits clear in a way that everybody understands. From the discussions I have had with Members of Parliament over the last few weeks, I believe that there has been a misunderstanding of many aspects of the scheme. That needs to be taken into account. We also need to consider, if possible, as a means of getting away from increases in contributions, the whole question of increasing the pension or retirement age. It could be part of the answer to some of the problems we face.
Another misunderstanding is the view that this scheme is expensively funded in itself. Schemes like this should be treated differently from unfunded or notionally funded schemes, as assessing changes to member contribution rates should take into account any excess returns generated by funded schemes from the investment strategy. I understand that the London Pension Fund Authority scheme, which is a funded scheme, might not be subject to the general contribution increase that the Government hope to implement. If there are exceptions there, they can be made anywhere else. I am convinced that an awful lot of negotiations are still to take place, and these will bring to the fore some of the elements of the pension fund that are not best understood.
Mr Anderson
Is there not a big problem with this whole debate in that we talk about these things as if they are a matter of negotiation, but in fact what we are really talking about is the fact that the Government are imposing a stealth tax on all public sector workers? They are not having negotiations about that, and they are not taking actuarial advice or the effect of the schemes into account. All they are saying is, “There will be an increase on public sector workers’ pensions” as a matter of fact—without allowing negotiations about any scheme to be taken into account.
Mr Donohoe
I am not in a position to answer that, as it is for the Leader of the House to do so, although I certainly have some sympathy with what my hon. Friend says.
Some of the closest comparators to Members are senior civil servants. Members of the civil service pension scheme and other schemes such as the scheme for staff of the House of Commons and the House of Lords pay either 3.5% or 1.5% contributions, depending on when they joined the civil service. For that contribution, they either build up a pension at the rate of one sixtieth, or one eightieth plus tax-free cash sum—which equates to one sixty-fourth—with a retirement age of 60, or they build up a pension at the rate of one forty-third with a retirement age of 65. That must be taken into account along with everything else in which we will be involved between now and 2015. It is clear from the discussions that have taken place that consideration must be given to all elements of Members’ contributions.
People may think that I only represent the House in this regard, but I have constituents who are aggrieved by what is happening to their pension funds, and I have every sympathy with them. However, I am here almost as a shop steward—I am not sure that that expression is much liked on the Government Benches—to represent Members in the context of their conditions of service. People describe this as a gold-plated scheme, but although it is a good scheme—indeed, I would argue that it is a brilliant scheme—what is not understood is that only a few Members of Parliament retire from this place with a full pension. Of the 650 serving Members of Parliament, only 35 would leave with one today. Another thing that is not understood is that most Members pay for the rate of one fortieth, which means paying 11.9%. So the scheme cannot really be described as gold-plated.
Dr Thérèse Coffey (Suffolk Coastal) (Con)
Does the hon. Gentleman accept that Members may have already contributed to pension schemes before being elected to the House? They do not generally come here at the age of 21.
Mr Donohoe
The regulations restrict the level of pension that can be paid on retirement. The limit is generally two thirds of pay inclusive of pensions that people have built up before becoming Members of Parliament. I think that that answers the hon. Lady’s question. As most MPs have other pension entitlements, the restriction means that a number of them are not paid the pension of one fortieth for each year of their parliamentary service. Worse, a small number of MPs who have not transferred their pensions to the fund end up subsidising the Exchequer by continuing to make contributions for a period for which they will receive no pension. That, too, is not best understood by those who criticise us.
I understand that the legislation allows Members to opt out. If there were an increase in the level of the contribution and if I were 45, I should find things very difficult. Given domestic circumstances, not every Member of Parliament is rich, and those who are not would find it difficult to continue to make their contributions. I understand that that also applies to many members of the fire service, for instance. There will be a drift, and if that gathers pace—as it could—the pension fund will suffer and the Exchequer will eventually have to fund more than it does at present. That must be factored into the equation before any change is made.
Our discussions with IPSA suggest—and Sir Ian Kennedy himself has stated—that it has determined that MPs’ conditions of service will be dealt with fairly, that it will work closely with the trustees once the powers are transferred, and that it would welcome proposals from the trustees on how the relationship should work. I have put that on record because it was said. At the trustee meeting Sir Ian attended, he went on to say that IPSA’s statutory independent role will be maintained. Importantly, that includes independence in respect of public perception. I think the public realise that, and I know the trustees will hold them to that point.
Mr Heath
We would have no power to do so. It is an independent process. If there was any notion that should be done, it would require changes to primary legislation, which would be a matter for the House, not the Government. We can be assured that that is the case.
I wish to put on the record my appreciation of the work that the hon. Member for Central Ayrshire (Mr Donohoe), who chairs the trustees of the parliamentary pension scheme, and his colleagues have done. We are particularly grateful to the hon. Members for Lewisham West and Penge (Jim Dowd) and for Watford (Richard Harrington) for stepping down in order to facilitate the transfer. I know that the hon. Member for Central Ayrshire takes an active interest and has been engaged in discussions throughout the process. I am particularly grateful for his letter, rather than his comments today, in which he stated: “Overall the trustees are of the view that the transfer of powers to IPSA will give the trustees the opportunity to contribute to the review of your pension scheme that we all know is inevitable in a constructive way.” Hear, hear to that. Everyone needs to take account of the caveats he offered, but I do not think that that obstructs the thrust of the motion. My hon. Friend the Member for Colchester (Bob Russell) will not agree with that point, because he does not like IPSA, he does not like all its works and he does not believe that he can trust it. I understand his position, but I invite him to look back at the legislation, which we passed, and accept it.
Mr Donohoe
One very important question has not been answered: when will the order be signed transferring to IPSA the powers to undertake the pension scheme?
Mr Heath
First, we have to accept the result of any vote this evening, but if the motion goes through the order will be made shortly, and the hon. Gentleman should know that that really does mean shortly; it will be not one of those that lasts several months.
I reconfirm for the hon. Member for Suffolk Coastal (Dr Coffey) that the Government propose to increase contributions to the ministerial scheme, with staged increases being applied from 1 April 2012, and that we will consult on the proposal, as required by the Constitutional Reform and Governance Act. For the avoidance of doubt, I should point out that I do not receive a ministerial salary or pension, so I will not be affected—[Interruption.] As the hon. Member for Wallasey says, I do the job for nothing—for my love of the job. I am glad that that is appreciated—[Interruption.] She does, too.
On that note of happy consensus, I hope the House will agree the motion and pass the matter to the independent body with the very clear indication that, no, we do not expect to be treated differently simply because we are Members of this House and have the opportunity to express our opinions here in the Chamber.
Points of Order
Brian H. Donohoe Excerpts(13 years, 10 months ago)
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Mr Brian H. Donohoe (Central Ayrshire) (Lab)
On a point of order, Mr Speaker. In an answer by the Leader of the House about employment tribunals, he said that all would be revealed next week. I have asked questions of the Ministry of Justice to elicit information about the number of people who have been unfairly dismissed with between one and two years’ service and have gone to a tribunal. I was told that the answer could not be given without disproportionate cost. Surely that is wrong if we are to debate that subject?
Mr Speaker
I am grateful to the hon. Gentleman for his point of order, which of course requires a ministerial reply. I do not know whether he was seeking to elicit something from the Leader of the House, who is welcome to comment, but under no obligation to do so.