Members’ Salaries

Debate between Jim Dowd and Lord Young of Cookham

Monday 21st March 2011 Commons Chamber

[Sir George Young]

I will come in a moment to the point about whether we should overturn the decision that we took in July 2008. Let me briefly set out the background. On 3 July 2008, the House agreed a new formula for uprating Members’ salaries, which is what I think my hon. Friend was referring to. The annual percentage increase would be the median of a basket of public sector comparators, and this percentage would be calculated by the Senior Salaries Review Body and notified to you, Mr Speaker, in a letter from its chairman. That percentage increase would then take effect automatically from 1 April.

That system has considerable advantages. It provides a fixed uprating formula so that we do not determine our own salaries. It is transparent, as the formula and the SSRB’s determination are there for everyone to see. It is also fair in that it provides a link between the salary of a Member of Parliament and the salaries of others in the public sector. Those are the virtues that the Government usually believe should underpin any system for determining our salaries—independence, transparency and fairness. We have therefore not taken lightly the decision to set aside the pay increase and thereby abandon the formula.

As I said, the Government’s decision to invite the House to agree to a pay freeze is the product of the difficult fiscal situation in which we have to find significant cost savings across the public sector. As my predecessor as Leader of the House, the right hon. and learned Member for Camberwell and Peckham (Ms Harman), said in the 2008 debate:

“given that MPs are paid from the public purse, we should show the same discipline in our pay increases as we expect from the public sector.”—[Official Report, 3 July 2008; Vol. 478, c. 1062.]

[Jim Dowd (Lewisham West and Penge) (Lab)]

The right hon. Gentleman is a decent fellow, but this is not quite the full story. The full story is that no Government have ever resisted the temptation to poke their nose into this business. We have set up mechanisms, to which the hon. Member for Gainsborough (Mr Leigh) referred, and said that they should be independent and we should go along with them, and then when it suits the Government of the day—not just this Government but any Government—they change the rules. That completely undermines any claim they make to believe in independent mechanisms. Either we come forward with what the independent review mechanism says, or we do not. This Government, like their predecessors, are poking their nose in where it does not belong.

[Sir George Young]

I should like to address very directly the hon. Gentleman’s point about the independence of the review that we are overturning. He rightly says that by bringing this motion before the House, a Government are once again asking Members to vote on their own remuneration—something that we believed we had put behind us. He asks the very good question as to why we are asking the House to reject the independent findings of the SSRB and whether the SSRB is unable to take on board issues of the kind that I have been talking about. The short answer is this: the system that was introduced in 2008 provided an objective mechanism for determining our pay, but it was a long way from being independent. The formula was devised by the previous Government and endorsed by the House, and in no sense could it be said to be independent.

For those, like the hon. Gentleman, who say that we are substituting our own judgment on this issue for that of the independent SSRB, I remind the House of what the chairman of the SSRB, Sir Bill Cockburn, said in his letter to you, Mr Speaker, on 19 January. He said:

“I should emphasise that the SSRB has no discretion in making this determination but simply applies the formula set out in the Resolution. We were not consulted when the Resolution was drawn up. The resulting figure is not what the SSRB would have recommended had we been able to have regard to all the circumstances including, this year, the Government’s pay freeze for public sector workers paid more that £21,000 a year.”

In a nutshell, the SSRB is saying that if its hands had not been tied by the House, it would not have recommended the 1% pay increase that came before us in January. If the hon. Gentleman looks at the pay recommendations for other professions published today by the SSRB and the Review Body on Doctors’ and Dentists’ Remuneration, he will see that no uplifts are recommended for those earning more than £21,000.