Management of the Economy and Ministerial Severance Payments

Rachel Hopkins Excerpts

Tuesday 15th November 2022 Commons Chamber

[Lucy Frazer]

I am grateful for the hon. Member’s very short intervention. I think she will have noticed that, throughout this speech, I have recognised that this Government, like every Government across many years, have made some mistakes. I have also stated the important point that the Prime Minister has shown, throughout his time as Cabinet Minister—as Chancellor and as Prime Minister—that he cares very deeply, as I and my Front-Bench colleagues do, about ensuring that vulnerable people get the support that they need.

I would like to turn to the issue of the severance pay. Payments connected to the loss of ministerial office are defined in legislation that has been passed by Parliament and been in effect for successive Administrations. Ministerial changes and departures are part of the fabric of government. All Administrations experience them and they are a routine part of the operation of government.

[Rachel Hopkins (Luton South) (Lab)]

Will the Minister give way?

[Lucy Frazer]

I am going to continue; I think I have been very generous with interventions.

The payments being discussed today exist because of the unpredictable nature of ministerial office. Unlike in other employment contexts, there are no periods of notice, no consultations and no redundancy arrangements. The statutory entitlement has existed for several decades and been implemented by all Governments over that period. Payments on ceasing office were made and accepted by outgoing Labour Ministers in the Blair and Brown years and by Liberal Democrat Ministers during the coalition Government.

The hon. Member for Wigan was asked a question by my hon. Friend the Member for Orpington (Gareth Bacon) about the level of those payments, and she either did not know the answer or decided not to respond. So I will tell her—[Interruption.]

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[Rachel Hopkins]

On that point, will the Minister give way?

[Alex Burghart]

I will make just a little progress, but don’t worry—we have plenty of time.

In a debate like this, it is important to be clear and a bit careful. There are two things going on when we talk about the economy in general: the international situation and the effect of decisions made by the previous Administration. It is true that both have had an effect; Conservative Members accept that. The Opposition will know that, having heard what the Chancellor said in this House on 17 October and what the Prime Minister said on the steps of Downing Street on 25 October. Listening to many Opposition Members’ speeches this afternoon, however, one would be forgiven for thinking that they had either not heard those statements or completely chosen to ignore them.

The fact is that the Chancellor and the Prime Minister have accepted that mistakes were made in the previous Administration, but it is also the case that a very serious international situation is affecting all major economies. That is why the IMF expects one third of the world to go into recession. It does hon. Members on either side no credit not to acknowledge those facts.

The shadow Secretary of State, the hon. Member for Wigan (Lisa Nandy), talked about a £30 billion figure, but she was not able to identify the source of that analysis or how it was calculated. [Interruption.] From a sedentary position, the hon. Member for Luton North says, “Her brain.” No doubt the brain of the hon. Member for Wigan is very large, but it is not itself the source of the analysis. Were she to footnote her brain in a report, she would rightly be called up on it.

The motion, from which we have strayed repeatedly during the debate, is about severance pay, about mortgages and about an attempt to censure two Members of this House. As my right hon. and learned Friend the Minister of State made clear at the start, payments connected to the loss of ministerial office are defined in legislation that has been passed by Parliament and has been in effect for successive Administrations.

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[Alex Burghart]

I will come to the point that I am going to make and then give way to the hon. Gentleman.

The payments that are being discussed today exist because of the unpredictable nature of ministerial office. Unlike in other employment contexts, there are no periods of notice, no consultations and no redundancy arrangements. This statutory entitlement has existed for several decades, and has been implemented by all Governments during that period. Payments on ceasing office were accepted by outgoing Labour Ministers in the Blair and Brown years, and by Liberal Democrat Ministers during the coalition Government. As has been pointed out by a number of Members, data published in 2010 indicated that severance payments made to outgoing Labour Ministers in that year amounted to £1 million.

[Rachel Hopkins]

I thank the Minister for giving way at this point, because I value the opportunity to talk about figures that he has mentioned. The average mortgage-paying householder in Luton South will have to pay an extra £500 a month as a consequence of the failure of this Government. Let me return to the motion, however. Can the Minister confirm that if it is passed, the Government will either reduce the ministerial severance payments by £6,000—the equivalent of a year’s worth of increased mortgage payments for my constituents—or seek to recover the amounts from the Members concerned?

[Alex Burghart]

As I was about to make clear, it is not within the Government’s power to do that. This is a power set in law. It is a power set in the Ministerial and other Pensions and Salaries Act 1991.