Public Service Pensions and Judicial Offices Bill [Lords]

Debate between John McDonnell and Lloyd Russell-Moyle

Report stage
Tuesday 22nd February 2022 Commons Chamber

[John McDonnell]

I was once, in my callow youth, an adviser to the mineworkers pension scheme, and then I was an adviser at the TUC, working with Lord Bryn Davies, who is one of our colleagues in the Lords at the moment, and there was never a problem with our fiduciary duty of maximising the income to the pension fund itself because of the range of investment opportunities available to us. I think we found in the past that exercising such moral judgment can prove effective in the long term, because it ensures that the fund is not investing in countries that may in the longer term become unstable as a result of the actions they take. I would just say, and I am making a personal point, that I think new clause 1 flies against my ability to exercise my moral duties about investments by my pension fund.

[Lloyd Russell-Moyle]

Will my right hon. Friend give way?

[John McDonnell]

Yes, but then I want to move on to my amendments.

[Lloyd Russell-Moyle]

Is there not a problem with this, in that it leaves the Secretary of State to decide what the foreign or defence policy might be in an arbitrary way, rather than requiring pension funds to set an ethical policy in which they can say that they do not want to invest in countries where there are human rights abuses? We would still have to treat all countries equally, so they could not target one country or another, but there would be an ethical framework, and this new clause does not allow an ethical framework.

[John McDonnell]

I would also come out fairly pragmatically and say that there may be some countries that, according to the Government, were not appropriate to invest in a few years ago but now are. I do not want a little red book to be thrown at me again, but I would just cite the fact that the relationship the Government have had with China has changed over the years and, I hope, is changing again at the moment with regard to the Uyghurs.

Let me move on to the new clause and amendments in my name. New clause 10 is a simple reflection of new clause 8, tabled by my hon. Friend the Member for Hampstead and Kilburn (Tulip Siddiq), on the pensions trap. I want to echo what I think she said really eloquently in Committee and today about how the dialogue on this issue must continue, because there is an unfairness at the heart of the legislation we are pushing through at the moment. This affects firefighters, police superintendents and so on, who feel aggrieved, and I feel that a bit more dialogue may enable us to find a solution and restore their confidence in the pension scheme itself. That is why I support new clause 8.

My new clause 10 is simply more explicit about ensuring that there are consultations with the trade unions and other employee representative bodies, and that we seek to overcome the problem so that we have a non-discriminatory approach that does not fall foul of the law.

I turn to my amendment 24, which addresses a complex issue. It reminds me of the debate we had on the d’Hondt proportional representation system, as there were only two people who understood it: Mr d’Hondt, who died, and Jack Straw. Let me just go straight to the point on this matter. I am sorry if I go into some detail. The Chief Secretary to the Treasury said in Committee that

“it is vital that we establish now, for the avoidance of any doubt, that no member benefits will be cut and no member contribution rates will increase as a result of the 2016 valuations. Any benefit improvements due will be honoured, but no additional costs will be imposed. I reassure the hon. Lady”—

my hon. Friend the Member for Hampstead and Kilburn—

“on her important question, that the costs of our remedy genuinely sit with the Exchequer, not scheme members.”––[Official Report, Public Service Pensions and Judicial Offices Bill [Lords] Public Bill Committee, 27 January 2022; c. 10.]

This is complicated stuff. There is a confusion of two issues here. The Government did make a mistake and were challenged in the courts. I fear that that cost burden will now fall on to members of the pension fund, if it is included in the cost mechanism as an employee cost. That is the issue.

I turn to two points in that regard. First, there is the cost to the scheme of giving members the option to choose which benefits—old or new—they want to accrue during the remedy period. Some members will choose benefits that are better for them than they would have received before the McCloud and Sargeant judgments. The scheme will clearly have to meet the cost of paying those benefits—fine. We got the assurance from the Minister that the money will flow—we think it is £17 billion; that is the last estimate—and the burden will not fall on to the members themselves, but that is not what we are talking about here. The issue here is what impact the cost of the remedy should have on the cost control mechanism. I remind Members that this is the mechanism for deciding whether members’ benefits should be changed or, alternatively, whether contributions could be changed.

There is no doubt that treating the cost of the remedy as an employee cost for the purposes of the cost control mechanism leaves members worse off than they would have been had it been treated as an employer cost. I draw the Chief Secretary’s attention to the helpful report from the House of Commons Library entitled “Public service pensions: the cost control mechanism”, which tells us that if we go back to the initial results of the 2012 scheme valuations, which were reported in 2018, the Government said that

“the protections in the new cost cap mechanism mean public sector workers [would] get improved pension benefits for employment over the period April 2019 to March 2023.”

It is those improved benefits that I believe are now at risk if the cost of the remedy is included as an employee cost and not an employer cost.

What does this mean? The improved benefits were required because members had suffered a reduction in the value of their expected benefits over the period 2012 to 2016 because of lower than expected pay increases and because longevity had not increased by as much as had been expected. In other words, the changes would not make members better off; they would simply maintain the value of the benefit package at the level that had been agreed. I apologise to Members, because this is complicated stuff, but it has to go on the record if we are to get redress on this, either today or in subsequent legal actions.

Given the requirement under the cost control mechanism, the respective scheme advisory board then set about agreeing the necessary changes in benefits. In other words, because the pay settlements had not been as large as predicted, and because people were not living as long as the predicted life expectancies, the cost burden on the scheme was less, which should have been reflected in benefits given back to members. The scheme advisory board started looking at what those benefits would be, and the Library report gives an example of packages of changes proposed for the civil service scheme, which included

“a reduction of member contributions; reform of the current contribution rate structure; and increased death benefits.”

The other schemes reflected similar sorts of benefits, so members would gain significantly as a result of this unfortunate situation—unfortunate because they never got enough pay settlements and never had the increase in life expectancy. Nevertheless, because those costs never fell on to the scheme, they should have been paid back to members.

In December 2018, the Court of Appeal ruled that part of the reforms amounted to unlawful discrimination. That was followed by the decision by the then Chief Secretary that the cost control element of the 2016 valuations should be put on hold. In other words, the members were to gain those benefits because of the cost control mechanism, the court decision took place, and the Government then froze the whole process. Eventually, the Government restarted the process and published the Treasury directions in October last year. The problem with the directions is that they treat the cost of remedying the Government’s mistake, as calculated for the purposes of the cost control mechanism, as a member cost, not an employer cost.

The important point to understand is that there is nothing inevitable about the remedy as a member cost. It has always been accepted that there are certain elements in the calculation involved in the cost control mechanism that are regarded as member costs that will impact on the cost control mechanism itself, but there are also other elements in the calculation that are employer costs and do not impact on the cost control mechanism. For example, the impact of changes in pay increases and mortality are obviously member costs, but changes in the discount rate and price increases are the employer costs. It is strongly argued by the trade unions, completely understandably, that mistakes made by the employer—that is, the Government—are employer costs.

What has never been discussed is how to treat the cost remedy incurred by the Government’s own error, and that is what needs to be addressed today. It was the Government’s mistake to have age discrimination in the scheme. The Minister in Committee said it was reflected in trade union representations, but as has been said by the Public Accounts Committee and others, the Government are the Government; they should have foreseen that there was the potential for discrimination. It is the Government who introduced the measures. It is the Government who are responsible for the Treasury directions and any legislation. It was a mistake by the Government. It is therefore logical that the cost of the remedy should be treated as an employer cost for the purposes of the cost control mechanism.

I apologise to hon. Members for the complexity of this, but it is important that we get on the record very explicitly that members of these pension funds should not have to pay in the long term for Government mistakes and should therefore have gained the benefit of either reduced contributions or enhanced benefits, because that is contained in what the Government agreed a number of years ago as the cost control mechanism.

Higher Education (Freedom of Speech) Bill (Eleventh sitting)

Debate between John McDonnell and Lloyd Russell-Moyle

Wednesday 22nd September 2021 Public Bill Committees

[John McDonnell]

The simple point is that this is possibly one of the most contentious appointments in government, because it deals with contentious issues. Without some element of robust non-partisan protection in the appointment process, the whole operation of the Bill might be undermined. That is why extra safeguards are needed to ensure a buffer between the individual and party political activity. That is what one of the amendments seeks to address.

[Lloyd Russell-Moyle]

Historically, universities were set up by royal charter, specifically to ensure that Governments of the day were not meddling in appointments at university and that free speech was thus preserved. That was the ancient, as well as the more modern right of universities. Surely there is a requirement for those principles to be extended to the body that will now interfere in the operation of universities. Otherwise, we undermine the whole principle of independence, autonomy and therefore free speech in our higher education sector.

[John McDonnell]

I caution Government Members. There have been reports recently of a pattern of behaviour by Government of making appointments of, in effect, members of and donors to the Tory party—some have described them as cronies. That evidences, I think, an attitude in some parts of Government that overrides the very principles that my hon. Friend refers to and, to be honest, the traditional practice that we have come to expect of Governments. We are nearing a limit on that.

Higher Education (Freedom of Speech) Bill (Tenth sitting)

Debate between John McDonnell and Lloyd Russell-Moyle

Monday 20th September 2021 Public Bill Committees

[John McDonnell (Hayes and Harlington) (Lab)]

I make this simple point. Like my hon. Friend, I have met the National Union of Students to talk about the legislation. One question asked was, “What have the Government got against young people?”, because this seems to be an attack on an organisation that young people rely on. I do not understand it. If the legislation is to act as a deterrent against poor behaviour, the Government need to set out what the deterrence is. If there is an element of risk if procedures are not adhered to, that needs to be set out. Normally when introducing sanctions, at least there is a tariff system of some sort. In this legislation, there is no tariff. We are completely in the dark.

The obvious solution is to simply consult people about what the levels should be and how they should relate to certain types of behaviour. In normal circumstances when we impose sanctions, that is what Governments do. Even when it comes to criminal sanctions, there is extensive consultation. Certainly when they introduce civil elements of a sanction, there is detailed consultation throughout with the relevant parties, but that has not taken place in this case. All the amendment would do is ask the Government to sit down with the relevant bodies that will be affected so that they can agree, or at least be consulted on, the nature and level of the sanctions that will be introduced, and—we have referred to this in previous debates—a realistic maximum that does not break the institutions that the Government seek to work with.

When the Government introduce contentious legislation such as this, it is best to take people and the organisations that will be affected with them. The best way of doing that is to engage them in consultation and discussion about the detail of the legislation as it is rolled out. I hope the Minister can give us some assurances—

[Lloyd Russell-Moyle (Brighton, Kemptown) (Lab/Co-op)]

It is important to set out in this Bill the thresholds of the compensation that can be paid because that will also help the court process. We heard in evidence that a large amount of the cost to the court could come from arguments and wrangling about what the actual damage cost is. If that is laid out by the OfS, that reduces the burden of the cost to the courts.

Higher Education (Freedom of Speech) Bill (Seventh sitting)

Debate between John McDonnell and Lloyd Russell-Moyle

Thursday 16th September 2021 Public Bill Committees

[Lloyd Russell-Moyle]

I agree. I am sure that the Minister will point to clause 1 and proposed new section A2(2) of the Higher Education and Research Act 2017, which provides that universities must create a code of practice that considers the conduct required of people speaking at the university. She may say that that is sufficient, but given that the Bill provides for a code of practice, it is a perfect time to consider how it is drawn up. It is not the Opposition saying that there should be a code of practice or that there should be limits on how people behave in public meetings or even in academic practice; the Government have included the provision. The Government are saying that universities must have a system to determine and delineate.

However, we have heard that what management thinks is acceptable is often very different from what the academic community and students find acceptable. Management might be motivated by thinking about good PR and what looks good in their recruitment, whereas academics might consider what is important for academic rigour, creating new debate and so on. The amendments are important because they propose including students and staff in the discussion about and creation of the code, and therefore the voting to approve it. Without including them, there is a danger that the code of conduct will be written up and created by universities and do everything that some people do not want it to do.

[John McDonnell]

The point of including in amendment 74 a consultation process on amendments is that things change over time. There are bound to be amendments to the code over time, so is not it better to ensure that a consultation process is built into the drafting? We talked in previous sittings about how attitudes to LGBT issues have changed. That sort of thing has to be reflected in any codes in future. That is just a pragmatic approach to how we develop.

[Lloyd Russell-Moyle]

Amendment 75 allows for consultation on the uses of premises, and would ensure the issue was covered by the code. As he mentions, amendment 74 is about future amendments to the code.

The Education Act 1994, introduced by a Conservative Government, regulated how student unions affiliate and who can affiliate with them, and created a democratic element to that. The Act requires a certain threshold of student turnout, and regular student polling to ensure that student unions do not affiliate with organisations that the student body might no longer feel it appropriate to affiliate with. That is why, up and down the country, student unions must have regular ballots on whether they should continue to affiliate with the National Union of Students. Some student unions—very few—choose not to affiliate with it. Southampton was one in my day, although it might have affiliated since; I cannot keep up with these things. Those requirements are quite right.

The procedures introduced by the Bill, particularly about a code of conduct that will regulate who can speak on campus and how, need to have that democratic aim. I would be more than happy if the Minister said, “This isn’t quite the wording. We want to incorporate some of the wording from the 1994 Act, as there are some parallels.” That would be great. However, there needs to be an appreciation of how students and staff will be balloted on both the use of premises and, more broadly, on the creation of the code of conduct and any amendment of it. Otherwise, there is real danger that the code will be written for a university’s public relations purposes, rather than to ensure a university’s academic rigour.

Higher Education (Freedom of Speech) Bill (Eighth sitting)

Debate between John McDonnell and Lloyd Russell-Moyle

Thursday 16th September 2021 Public Bill Committees

[John McDonnell]

rose—

[Lloyd Russell-Moyle]

rose—

--- Later in debate ---

[Lloyd Russell-Moyle]

It might well be that the Minister can—[Interruption.] I am not sure that I am allowed to ask the Whip to speak, but he was muttering something under his breath that I did not quite hear. Let us say that we had another amendment, with slightly different wording, which was specific to, for example, student halls, places that are focused on students, places that the university authorises for students to be exclusively at—like student halls but also other student clubs. For example, I have known universities that, rather than having a student union-run bar, will make an arrangement with a commercial bar provider to provide a student-specific bar with student-specific meeting rooms. It might well be that an amendment that just ensures that the duty is extended to commercial providers would be better than this amendment. I am open to that, but we need something; otherwise there is a real danger, particularly with universities moving more and more to commercial partnerships.

[John McDonnell]

rose—

[Lloyd Russell-Moyle]

I give way to John—my right hon. Friend the Member for Hayes and Harlington.

[John McDonnell]

I have never known him to be so affectionate. [Interruption.] I can’t help myself. The complexities of this are amazing. The hon. Member for Ruislip, Northwood and Pinner and I are both ex-Birkbeck. If someone joins the Birkbeck student union, they are then a member of the junior common room at the School of Oriental and African Studies and therefore have access to the SOAS junior common room bar, and can book it for meetings, invite speakers and so on. Again, I am not sure of the status or the independence of the student union at Birkbeck, or the status of the relationship with the SOAS junior common room, and therefore of the line of accountability for control of the premises. Unless the Bill is all-encompassing, it will introduce myriad problems.

[Lloyd Russell-Moyle]

We had the equivalent discussion with regard to academics; we talked about what would happen with a visiting academic. Yes, they would be protected in their own institution, but they would not necessarily be protected as a visitor, so that is why we put forward amendments. We have the same issues about, in effect, visiting students. This applies particularly to London. London University, as a federal university, will have overlapping student unions. Unfortunately, we have seen the demise of the University of London union, which is a great shame for the University of London. I think that, bizarrely, was done for political purposes. I am convinced that the last few presidents and leaders of the University of London union were too-left-wing rabble-rousers. It was fed up with it, and fed up with the London Student newspaper being too much of a pain, and it shut it down, so that is an example. Would this Bill prevent the shutting down of the University of London union, which was shut down in my—

Higher Education (Freedom of Speech) Bill (Sixth sitting)

Debate between John McDonnell and Lloyd Russell-Moyle

Wednesday 15th September 2021 Public Bill Committees

[John McDonnell]

There are even elements in science itself where there are really contentious issues and we know that some scientific theories are being brought forward for political motives—we have seen that around race in the past, about genetics linked to racial groups and so on—but an academic would throw the whole essay out on that basis. There are some really contentious issues here.

The hon. Member for Congleton is right to point out the issue of non-inclusion of students, but we must find a definition that enables us to ensure that there is a level of academic expertise at which the student should be operating, which qualifies that person to have academic freedom and the right to free speech. I think that is very difficult.

To come on to the point made by my hon. Friend the Member for Brighton, Kemptown, in academia, people are now extremely litigious. They will challenge individual gradings or the award of the degree classification. What we often find now—ask any university—is that a large amount of money and time is being spent on defending the awarding of degrees due to this sense of being a consumer, of buying a product. It is as though they are challenging the quality of the degree awarded as though it were a washing machine. There is a real issue here.

[Lloyd Russell-Moyle]

My right hon. Friend makes some good points about the litigiousness, but also about the ability that people have to challenge the status quo to create knowledge. That is when they then take part in research, and that is when they then take part in the production of knowledge.

For undergraduates, however, and even sometimes in taught masters programmes, particularly for professional qualifications, it is about instruction. Very often, in that purpose of instruction, students should be able to make an argument that is not their own. Their teachers want to say to them, “If you just make your own argument, I am going to mark you down.” We talked in the evidence sessions about debating societies. Teachers want to say to their students, “If you produce an essay which is your own argument, that is not going to be highly regarded. I want you to produce something you might vehemently disagree with, but that is the point of this exercise.”

There is a danger that, if students are given personal academic freedom, they will say, “Well, that is not my view. I have got an academic freedom to express what my view is.” The distinction must be between taught and research, and between the creation of knowledge and instruction. The flipside is a researcher or university member of staff enrolling in a course for academic interest, and then taking on a different role as a student and being instructed. The freedom does not stay with the person; the freedom is the role that the person is undertaking at that moment.

[John McDonnell]

Right, I am waiting for the Minister to say that this will be covered in guidance. On this occasion, I might well support her, because it is complicated. It is a combination of the level of the degree and the content and status of the research. In some instances, there will be very specific examples and we will see it playing out in individual cases and challenges setting a precedent. If we are not careful, I can see the vista being lawyers making a huge amount of money at the expense of universities.

The hon. Member for Congleton has raised a genuine issue and we should address it with subtlety, recognising that it could open the doors to a whole range of activities that would burden universities and confuse the individual academics and students themselves. I look forward to the guidance.

Higher Education (Freedom of Speech) Bill (Fifth sitting)

Debate between John McDonnell and Lloyd Russell-Moyle

Wednesday 15th September 2021 Public Bill Committees

[Lloyd Russell-Moyle]

The whole Bill is full of tensions, which is why many of us would say this is not best put in legislation; instead, it could be done through other mechanisms, such as guidance and support for universities, given that we already have the Office for Students. That is the Opposition’s whole argument on whether we need a Bill. However, we have a Bill, so we need to create a framework to ensure that those tensions are dealt with sensitively.

[John McDonnell]

May I add to my hon. Friend’s note of caution? In 2010, when the equalities legislation was introduced by the then Conservative Government, there was extensive debate. He will remember the debates around what constituted an appropriate joke, and whether that was encompassed in legislation. We now have 11 years of experience of that legislation, and precedent has built up, after court actions. I am fearful to tread into an area where I think we have a settled opinion at the moment. This amendment could be counterproductive, because it would reopen that whole debate, which I thought we had comfortably settled.

[Lloyd Russell-Moyle]

I totally agree. Again, that is the importance of the guidance. The Office for Students can sit down with other regulators and work out a settled opinion, which might be that there is not enough guidance for universities to interpret things correctly.

The right hon. Gentleman has mentioned a number of times the no-platform policy of the National Union of Students. That is a policy that bans National Action, a proscribed, illegal organisation in this country. It is a policy that bans Hizb ut-Tahrir, an organisation that is prevented from entering campuses under Prevent. It bans only a small handful of organisations—literally fewer than 10.

Higher Education (Freedom of Speech) Bill (Fourth sitting)

Debate between John McDonnell and Lloyd Russell-Moyle

Monday 13th September 2021 Public Bill Committees

[John McDonnell (Hayes and Harlington) (Lab)]

Ditto.

[Lloyd Russell-Moyle]

As I mentioned in the previous sitting, I am a trustee at the University of Bradford union, I receive money from the University of Sussex to provide educational opportunities to its students, and I have received support from the University and College Union.

Higher Education (Freedom of Speech) Bill (Fourth sitting)

Debate between John McDonnell and Lloyd Russell-Moyle

Monday 13th September 2021 Public Bill Committees

[John McDonnell (Hayes and Harlington) (Lab)]

[Lloyd Russell-Moyle]

Financial and Social Emergency Support Package

Debate between John McDonnell and Lloyd Russell-Moyle

Wednesday 25th March 2020 Commons Chamber

[John McDonnell]

I am grateful for my hon. Friend’s words. We have asked for a while, not least when we put forward our proposals last Thursday, that there should be a floor of the national minimum wage. If those who are on low pay get 80% of their pay, many of them will be taken below the national minimum wage. It is set at that level because it is a basic survival level, so we urge the Government to act. Again, that is only a small step.

It cannot be beyond the wit of the great minds in the Treasury to find a way to resolve a number of these issues, and that call was reiterated by the Resolution Foundation this morning. A YouGov poll found that one in 10 people surveyed are still in work but with reduced pay or hours. Those people are not protected by this scheme. For businesses to stay afloat, many of them will need part-time workers, and those part-time workers need the support that this scheme should provide.

Zero-hours contract workers and agency workers who are not on PAYE are limb (b) workers, as I explained to the Chancellor and wrote to him about at the beginning of the week. They must be made eligible for the job retention scheme; otherwise, there is the potential that 2 million workers will not be included in the scheme. These are some of the workers who are most at risk of losing work and not being able to put food on the table during this downturn.

Several Members mentioned this, but I urge the Government to give an assurance that non-UK nationals are eligible for this scheme. I also appeal to the Government to ensure that support is provided for non-UK nationals in the coming weeks when travel is so restricted. Let me echo what several Members have said: that must include the suspension of the rules of no recourse to public funds. The rules that have been put in place may be acceptable to some Members, but in this period those rules are brutal and will force people into penury.

Staff who can no longer work because of childcare responsibilities must be protected as well. Why on earth are they not eligible for this scheme? Just think of the single parent who cannot work because they need to stay at home with their child—surely they should be covered as well. On the subject of childcare, can the Minister be clear that childcare providers should not be charging parents for services that they no longer deliver or cannot now deliver? Those childcare providers must be supported in the long term as well, because we will need them.

My concern, which many Members have expressed today, is the gaps in the scheme and the fact that it will not be operational until April. People will not receive funding for weeks, and it certainly will not be taken up at the rate that many of us would hope for, given the indications from a large number of employers. Lay-offs are happening at scale.

[Lloyd Russell-Moyle]

Does my right hon. Friend agree that the Government need to ensure that anyone who was laid off before the announcement of the scheme can be brought back into employment and put on the scheme, and that any employer that does not do that should be named or required by the Government to do that?

[John McDonnell]

The problem we have, as my hon. Friend points out, is that this is a voluntary scheme for employers to participate in. What we have to do is to use everything we possibly can to urge employers to participate, protect their workers and use to maximum effect the scheme itself.

--- Later in debate ---

[John McDonnell (Hayes and Harlington) (Lab)]

Further to that point of order, Mr Speaker. I understand some of the difficulties, but perhaps we could get an assurance that we will at least have a copy of the proposals in advance, before the media. We will honour whatever embargo is placed upon us, as we always do with statements that are provided to us. That would give us the opportunity to frame any subsequent questions we want to put to the Government, to respond to any concerns that are raised by our constituents and to prepare a briefing for our own Members of Parliament.

[Lloyd Russell-Moyle (Brighton, Kemptown) (Lab/Co-op)]

Further to that point of order, Mr Speaker. Yesterday, the Health Secretary held a very innovative press conference that was completely online. On Monday, I and many other Members held a very good meeting with the immigration Minister via Skype. Can there not be a reassurance that Ministers will undertake to hold briefings over telephone calls or online for Members—it does not have to be a sitting of Parliament—so that we can ask those questions directly, because often one gets a better or more nuanced response in person than through written correspondence? It would help resolve some of the issues if Members had access to Ministers directly after an announcement in that kind of mode.