Armed Forces (Pensions and Benefits)

Gemma Doyle Excerpts

Tuesday 8th March 2011 Westminster Hall

[Gemma Doyle (West Dunbartonshire) (Lab/Co-op)]

I congratulate my hon. Friend the Member for Liverpool, Walton (Steve Rotheram) on securing this important debate. As he mentioned, we have had a number of opportunities recently to debate these issues, including armed forces pensions and the military covenant. It is very important that we continue to debate them, because we have not yet received a satisfactory response from the Government Front-Bench team. Today we have a different Minister before us. Thus far, I have discussed these issues with the Under-Secretary of State for Defence, the right hon. Member for South Leicestershire (Mr Robathan), who is the Minister with responsibility for veterans. I am hopeful that we might hear something from the Minister who is here today that pleases us.

My hon. Friend the Member for Liverpool, Walton has already mentioned a quote from the Forces Pension Society, but it is one that merits repeating. The chairman of the society, Sir Michael Moore, recently said:

“I have never seen a Government erode the morale of the armed forces so quickly.”

That is quite a strong statement and the reasons for it stem from the wide-ranging promises made by the coalition partners to our service personnel, ahead of last year’s election and since coming into office. Their record of delivery has spectacularly failed to live up to their rhetoric.

In opposition, the Conservatives declared that the military covenant was “shattered” and they promised to rebuild it. Both the Conservatives and the Liberal Democrats made clear pledges to our armed forces, such as improving service housing, setting minimum standards for family welfare and maximising rest and recuperation leave. In government, they have so far offered very little to address those issues. Indeed, it is worse than that, because the measures that we are seeing now will roll back the military covenant. Accommodation has been identified as an area in which to make savings; tours of duty will be reviewed and there has been no guarantee that they will not be lengthened; and the Government have confirmed that armed forces personnel will be cut by 11,000.

The Prime Minister could not have made a clearer pledge than the one that he made to sailors on the aircraft carrier HMS Ark Royal just last summer:

“Whether it’s the schools you send your children to, whether it’s the healthcare that you expect, whether it’s the fact there should be a decent military ward for anyone who gets injured...I want all these things refreshed and renewed and written down in a new military covenant that’s written into the law of the land.”

However, nine months later, the Government have failed to enshrine a military covenant in law, or at the very least propose doing so in the Armed Forces Bill, which is making its way through Parliament. Instead, they have already changed their policy, as outlined to all MPs in a recent letter from the Royal British Legion.

As far as the armed forces are concerned, the Government’s time in office has been marked by broken promises and empty rhetoric. However, it is more serious than that. The actions of the Government are undermining the unwritten contract between the nation and our services in honour of the brave work that they do. In the process, as Sir Michael Moore said, the Government

“erode the morale of the armed forces”.

There is no better example of that than the impact of the Government’s planned pensions changes on the armed forces. As my hon. Friend the Member for Liverpool, Walton has outlined, the Government’s plans permanently to link public sector pension rises to CPI rather than to the usually higher measure of RPI will disproportionately affect members of the armed forces. I know that the Minister with responsibility for veterans does not accept that because he told me so in the Committee that considered the Armed Forces Bill, and I do not know whether the Minister for the Armed Forces will take a different approach today.

[Dr Murrison]

The hon. Lady puts forward an interesting case. Will she therefore commit any incoming Labour Government in 2015 to the measure that she appears to be articulating, namely, that the change will be temporary and, if so, how will that feature in the budget she intends to set? The armed forces will not be alone; others will say that they should be dealt with in a similar way.

[Gemma Doyle]

I think that the hon. Gentleman is aware that we proposed a much fairer, time-limited approach, and that would be a better way forward.

If the Minister will not listen to me, perhaps he will heed the concerns of the Forces Pension Society, which delivered a letter to No. 10 in December to explain to the Prime Minister the disproportionate impact of the pension changes on the armed forces. Many members of the armed forces leave the military by the time they are 40, or earlier perhaps, if they are injured, so their pensions start to pay out much earlier compared to those of other public sector workers, and the changes will result in their losing hundreds of thousands of pounds over their lifetimes. As my hon. Friend the Member for Liverpool, Walton said, we are not talking about small amounts of money—these are very significant amounts. For example, a corporal who lost both legs in a bomb blast—a horrific and serious injury—would miss out on about £500,000 in pension and benefit-related payment, a figure that is very difficult to justify. War widows, who disproportionately rely on their pension schemes, will also lose out enormously. According to figures from the Forces Pension Society, a 34-year-old wife of a staff sergeant killed in Afghanistan would be almost £750,000 worse off. Again, that is very difficult to get one’s head around, and to justify.

There can be only two possible reasons for the changes. The Government might think that armed forces pensions are too generous, but I have not heard them saying that, so I can assume only that it must be about deficit reduction, which is indeed the argument that has been put forward. I am afraid, however, that that argument does not add up either because the impact of the change from RPI to CPI uprating will be felt long after the Government’s intention to pay down the deficit is achieved.

[Steve Rotheram]

I mentioned a constituent of mine, Craig Lunberg, who fought for his country and was blinded and severely injured, but is getting on with life. Why should he have to pay for the bankers’ excesses? My hon. Friend might wish to speculate on that.

[Gemma Doyle]

I agree with my hon. Friend that his constituent should not have to pay for the bankers’ excesses. I am not sure whether the Minister believes that, and perhaps he will address the point.

Although the figures demonstrate that the impact of the changes will be felt long after the deficit has been paid down—thus far paying down the deficit seems to be the only argument for change—the Government are determined to reduce the support given to forces members and their dependants every year from now on, even when the economy has returned to growth, as they predict it will. The hon. Member for Upper Bann (David Simpson) made the point very well that it is important to balance the needs of our economy with the unique debt that we owe our armed forces.

People will find it very hard to understand why men and women serving in Afghanistan now will receive poorer pensions, and why war widows will have their entitlements hit, year on year. Service personnel in Afghanistan were told, last November I think, by the Secretary of State that they would not be made redundant, but they have now been told that they have been included in the pool of people being considered. That is a very worrying U-turn by the Government. Our armed forces do very dangerous and difficult work in conflict zones all over the globe, and it places great strain on loved ones when their husbands and wives, mothers and fathers, and sons and daughters spend many months at a time away from home. Dependants, the majority of whom are women, often make huge sacrifices to support those on the front line, and we owe them just as big a debt of gratitude as we do those in combat, particularly today, on international women’s day. The most important thing that we can do to go some way to repaying that debt is to ensure that service personnel and their families are looked after during and after their time in the forces, especially if their service is cut short because of injury or death.

Our military men and women deserve the best treatment for the work they do. They are not demanding special treatment on pensions; they just want to be treated fairly. By making pension changes that will hit members of the armed forces this hard, and for the rest of their lives, the Government are clearly not treating them fairly. Ministers must look again at the policy, and if they believe that it is part of their deficit reduction plan they should consider a time-limited measure during the period of deficit reduction and spending restraint. That would be a much fairer approach. There cannot be a logical reason why the bravest British soldiers fighting in Afghanistan should see their pensions reduced for the rest of their lives, and why war widows, who have had the person most special to them taken away, should have the support on which they so depend taken away.

The hon. Member for Carmarthen West and South Pembrokeshire (Simon Hart) asked whether the changes will lead to a recruitment problem. Service families have recently told me that the changes are leading to their seriously considering leaving the armed forces. I am also told that people in the armed forces are talking about their exit strategy—not our exit strategy from Afghanistan, but their own personal exit strategy from the armed forces—because of the severity of the changes.

As my hon. Friend the Member for Liverpool, Walton has noted, a Ministry of Defence spokesperson, when challenged in November on the unique nature of military service, said:

“It is not possible to treat the armed forces differently from other pubic servants.”

I am happy to remind that spokesperson of the unique nature of military service. My hon. Friend has covered some of these points, but they are so important that I will make them again, and I hope that that spokesperson listens. Service personnel are required to work unlimited hours in dangerous conditions, with no prospect of overtime, and can be imprisoned for failing to show up. Their living conditions can be very tough, and they are often separated from family and loved ones for many months at a time. They can be compelled to return, even after retiring. They forgo several political freedoms and contractual rights that other people rightly enjoy, and they are at risk of being killed or horribly maimed as a direct result and an unavoidable consequence of their service. Their pension is a serious and tangible financial compensation for those things, and the Government must bear that in mind.

The Government must be held to greater account for their approach to the armed forces, particularly on pensions. They have reversed their promise to write the military covenant into legislation, when recognising the covenant and enshrining it in law is more important than ever. Instead of writing the covenant into law, it is proposed that the Secretary of State will report annually to Parliament on the effect that membership of the armed forces has on service people, with specific reference only to health care, education and housing. Of course, those issues are vital to service personnel, their families and veterans, but there are many other issues that affect their daily lives, particularly since the election of the Government.

With the Armed Forces Bill Committee, I visited a garrison a couple of weeks ago and met several soldiers and their families. The concerns they raised were about cuts to allowances, cuts to pensions and the difficulties faced by service family members seeking employment. We have seen no movement from the Government on the issue of honouring their pledge to enshrine the military covenant in law. The Minister said on Radio 4 in February that they were defining the covenant in law. He might wish to take the opportunity to correct his remarks. Even his own team has not said that it will be defined in law—it continues to insist that it will be enshrined in law. In fact, neither is true. However, if the Government will not honour their pledge, at the very least, they must broaden the scope of the annual report on the covenant. We have proposed, through a series of amendments in Committee, that the terms of the covenant report should be expanded to include issues such as mental health care, employment and training and, crucially, pensions and benefits. It would be bizarre if the Secretary of State was required to come to Parliament and produce a report that did not reflect his or her direct responsibilities.

The coalition has so far rejected that proposal but I urge it again—particularly in the light of the letter from Chris Simpkins, director general of the Royal British Legion, to the Under-Secretary of State for Defence, the right hon. Member for South Leicestershire—to ensure that Parliament has the opportunity to scrutinise closely the current and future Governments’ approach to the much wider range of issues facing our service personnel.

The chair of the RAF Families Federation told the Armed Forces Bill Committee recently:

“At the moment, there is a real feeling within the armed forces that they are being battered from all sides.”

It is easy to understand that view when one considers the Government’s pension changes, their plans to make thousands of service personnel redundant and the litany of broken promises that simply do not match the rhetoric that we heard before the election. We can add to that the Government’s decision to scrap major reforms to the system of inquests on military deaths, which has been described as a betrayal by forces families.

Today’s debate is an opportunity to highlight the unfair impact that the Government's pension changes will have on our brave servicemen and women, and again to call on Ministers to rethink their approach. I look forward to hearing the Minister’s response. It is also another opportunity to hold the Government to account for their general approach to our armed forces. In their nine months in office they have failed to live up to their pre-election rhetoric, and their actions—including the impact of the changes to pensions—have seriously damaged the sacred bond of trust between the nation and the armed forces who bravely defend our freedoms.

[The Minister for the Armed Forces (Nick Harvey)]

I commend the hon. Member for Liverpool, Walton (Steve Rotheram) on initiating this debate on the effect on the armed forces of Government changes to pensions and benefits, and I acknowledge that the subject is profoundly important to many people.

Our armed forces are deployed to most demanding areas of conflict and we have a duty, not only as a Government but as a nation, to support and look after them, to care for the injured and the bereaved. That is common ground for all hon. Members. As the House knows, the priority for the Government is to bring the national finances under control by reducing the deficit, which inevitably means reducing public expenditure. That means that we have to take difficult and sometimes very unpalatable decisions in all areas of spending, including defence. Because of the priority we place on security, the defence budget is making a more modest contribution to deficit reduction relative to almost all other Departments.

However, in the comprehensive spending review and the strategic defence and security review, we have still had to take difficult decisions that have repercussions for some members of the armed forces and their families. I repeat that many of those decisions have been unpalatable. Nobody in the coalition came into politics to make cuts to the armed forces or to eliminate capabilities in our military power, but that is what we have had to do.

[Gemma Doyle]

Will the Minister confirm that the decisions he refers to are financial, not strategic?

[Nick Harvey]

I am coming to that. We have to acknowledge three things. First, the scale of the deficit is so enormous that £1 in every £4 of public expenditure is being borrowed, and the interest alone on the debt this year is greater than the entire defence budget, including the proportion being paid by the Treasury for operations in Afghanistan. That is how immense the overall deficit black hole is. That is compounded in the area of defence by the situation we inherited, where the defence budget was lagging behind the defence forward programme over the 10-year planning period by £38 billion. That is the gap between the programme that we inherited and the existing budget, set at a flat real basis, for the 10-year planning period. That is over and on top of the general deficit picture that we inherited. There is the general picture and the specific defence picture.

The third element, which I do not think was acknowledged adequately by the hon. Member for Liverpool, Walton, is that before there ever was an economic downturn, before the banking crisis hit, before the deficit became part of the political currency, there was already a problem with public service pensions, which the previous Government had acknowledged and was beginning to address, and which was going to require pretty drastic action sooner or later, irrespective of the nation’s finances plunging as they did. Before any of that started, there was already a serious problem with the affordability of public service pensions. We have to acknowledge all three factors as the backcloth to the decisions that have subsequently been taken.

[Gemma Doyle]

Will the Minister give an example of a time in the previous Parliament when either his or the Conservative party called for less defence spending?

[Nick Harvey]

Certainly not. We would have liked to have seen more defence spending. We would still like to see that now. The fact is that defence figures, for obvious security reasons, are not exposed to the same degree of parliamentary scrutiny as those of other Departments, and with the long lead time of many defence items, commitments stretch further into the future than they do in many other Departments. Although we were aware from Bernard Gray’s report on procurement that there were some pretty serious financial difficulties inside the Ministry of Defence, it was not until we got in and saw the full scale of it that we realised how drastic the defence budget’s problems were.