Public Service Pensions Bill

Simon Hughes Excerpts

Monday 22nd April 2013 Commons Chamber

[Sajid Javid]

As I make progress and explain the Government’s position, I will come to that point.

The Government do not believe the amendments to be the correct way forward, either for the taxpayer or the forces themselves. I will briefly set out some of the key reasons for our position. Allow me first, however, to reassure both hon. Members and the work forces themselves that the Government understand their concerns. We have listened to the representations and reflected on the discussions in another place, and I want to make it absolutely clear that we recognise the unique position of these work forces and the important role that the defence fire and rescue service and the Ministry of Defence police play.

My colleague Lord Newby met DFRS and MDP officers to talk through their experiences on the ground and the demands of their roles. There is no doubt that these public services deliver a valuable service to the armed forces and the country more generally. The nature of the work they are called on to deliver is often very difficult and at times can be dangerous. On occasion, some members of these work forces might find themselves putting their lives at risk. No one in the House is suggesting otherwise, so let us not be distracted from this important discussion by cherry-picking anecdotes and citing emotive examples of the work involved, because that is not the issue being discussed today.

[Simon Hughes (Bermondsey and Old Southwark) (LD)]

Like many people, I have met representatives of workers in the MOD scheme, and they have referred me to Lord Hutton’s comments that he was not aware of the anomaly and therefore did not address it in his report, but that he was sympathetic. I have seen both sides of the argument. Our noble friend Lord Newby said that he would reflect on the debate in the Lords. Have there been any further conversations with Lord Hutton? In general, my understanding is that the Government are seeking to implement Lord Hutton’s recommendations, but this issue has clearly slipped through the net.

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[Sajid Javid]

The hon. Gentleman has made a good point, and made it well. It is important to consider the capability of each work force, especially in view of increased longevity, and to ensure that the retirement age is appropriate. That is what I expect the MOD to do, and that is what it is doing, but it should do it in the context of the particular scheme for each work force, rather than by becoming involved in the details of each work force that are affected by the broad changes introduced by the Bill.

We have a responsibility to look rationally at the costs of the proposed changes. The additional costs may appear small in comparison with the savings that the Government are making through their overall programme of pension reforms, but the Government consider them to be both unnecessary and significant. They are unnecessary because those concerned will continue to have access to the civil service pension scheme, which is an excellent scheme that many in the private sector, including those doing the most arduous or specialist work, would envy. They are significant because some early indications suggest that they could be as high as £10 million a year for the lifetime of the schemes. This expenditure would take money away from front-line servicemen and women, and from other important defence priorities.

Those who support the amendments may believe that the members should pay the cost of the reduced retirement age themselves. That would imply increased employee contributions and a potential average take-home pay cut of over 8%—although it would depend on the exact terms—which might not necessarily be welcomed by members of the forces.

As politicians, we should not be trying to set the fine detail of public servants' pension schemes on the Floor of the House. Rushing at it might lead to mistakes. As I hope I have made clear, I acknowledge that the issue deserves further consideration allowing time for discussions between employer and employee. We owe it to the DFRS and the MDP to get this right.

[Simon Hughes]

What the Minister has just said is very helpful, provided that the Treasury too will be helpful if the negotiations between the unions and the MOD produce a different package. I understand the financial point, and I also understand that this is not just about retirement ages but about all the other benefits, which may be better than they are under the present arrangement. Can the Minister confirm that, if the MOD picks up the baton, the Treasury will not walk away and say “Nothing to do with us, guv”, but will continue to take an interest in the resolution of this outstanding bit of business?

[Sajid Javid]

What I can confirm is that the Treasury and the MOD are in exactly the same place. The MOD agrees with the terms that I am presenting today, and, as I have said, has made it clear that it will think about the issue. It has already written about it to members of the forces, as I would expect it to do in its capacity as the employer of these vital groups of workers.

The Government have not dismissed the claims of the DFRS or the MDP; far from it. The MOD has acknowledged in writing that there is a case for looking at their pension age to check that it is still appropriate.

Finally, there is a technical reason why the Government cannot accept these amendments as they currently stand. They would—unintentionally, I assume—confer powers on the Scottish Parliament and Welsh Assembly to make schemes for these civil servants. That would give new functions to devolved Administrations, without any proper consultation or consideration of whether that is the appropriate framework for managing the interests of these specialised work forces.

In summary, this is a complicated and inevitably emotive issue, and one that we have discussed at some length. I am sure I will not have persuaded all Members present today.

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[Chris Leslie]

Quite a few of those employees already retire before the normal retirement age because of issues of physicality—the sheer effort involved in undertaking such physical tasks. It is entirely unreasonable and unfair that there is such a discrepancy between public service workers who carry out the same job. They are all called on to put their lives on the line. The burden of justifying the anomaly now rests with the Government, but other than some rather unconvincing arguments, which the Minister barely touched on, they have failed to discharge their burden and to illustrate why MOD firefighters and police are so different. The Minister took interventions from many colleagues and on a number of occasions he said, “Oh well, I’ll come to it in my speech,” but amazingly he never did.

[Simon Hughes]

Given that neither the Labour Government nor Lord Hutton spotted the issue, and it has now been raised with this Government, does the hon. Gentleman not think that a reasonable way forward is what the Minister suggested at the end of his speech? We should allow the MOD and the unions to see if they can negotiate a proposal that could be implemented under the broad remit of the Bill. That must be the reasonable, sensible, grown-up way forward.

[Chris Leslie]

At this eleventh hour, no, because the issue has been familiar to the Government for many months. The Minister said that there was not even a proposal on the table. We are able to judge, as Lord Hutton was able to judge, as suggested by the quotes from the House of Lords debate, the definitions of firefighter, police officer and armed forces, for whom the Bill categorically specifies the normal pension age as 60. The right hon. Gentleman is suggesting that some sort of negotiation is needed about whether those individuals are indeed firefighters or police officers of the same class. I disagree with him, if he is naive enough to think that the Treasury and the Ministry of Defence do not need to be pushed on the issue. Today is the opportunity to vote on it. I know he will listen to the debate and I hope he will vote in the right way and not try to find some excuse for kicking the issue into the long grass, hoping that people will forget about it yet again. We have the opportunity to deal with it now. Let us have a bit of gumption and deal with it in the way that we can do.

[Simon Hughes]

May I tell the hon. Gentleman respectfully why I disagree with that? This is not just about age. It is about a whole package of benefits, some of which are much more advantageous to people in the civil service than they would be to someone in a parallel position in local government. I am not in a position, and even those on the Labour Benches who represent unions are not in a position, to do a deal here on their behalf. If Government are committed to a deal being done, it must be right to remit the issue to the employer and the unions to negotiate an outcome.

[Chris Leslie]

I am very sorry that the right hon. Gentleman’s true colours have come through in that way. He is clearly not going to support the move to reduce the retirement age to 60. He should, and I will tell him why. The key question was put by Lord Eatwell in the other place, who asked about the different treatment and whether the Government could justify it. He asked:

“In what way is it less onerous, when they”—

that is, the MOD firefighters—

“have to work on military establishments”—

as the hon. Member for Colchester (Sir Bob Russell) said—

“dealing on occasion with extremely dangerous materials, and occasionally also in war zones? How is their job less onerous?”—[Official Report, House of Lords, 12 February 2013; Vol. 743, c. 568.]

Unfortunately, my noble Friend did not receive a satisfactory answer to the question, so I repeat it now to the Minister: what reason is there for that different treatment? Do not Ministry of Defence police officers have to stay fit, remain physically alert and intervene in events of great physical danger? Do not Ministry of Defence firefighters have to be ready to run the gauntlet, endure the exertions of search and rescue in extreme circumstances, take intense risks, prove their stamina and make sure that they can rise to the most testing of circumstances? The arguments that justify excluding the police and fire and rescue workers from the link between state pension age and normal pension age apply equally to the MOD police and the MOD firefighters. Just because they are a tiny number of workers should not mean that Ministers can just turn a blind eye and ignore the issue. We cannot allow it to be swept under the carpet. There is no reason for the difference, and the Government have no justification for opposing the amendments.

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[Sir Bob Russell]

Well, the hon. Lady and I must beg to differ. I do not want her to think that her support for MOD firefighters and police officers is greater than mine. I was arguing in support of the MOD police when the previous Labour Government were cutting their numbers—so I can do without those sorts of comparisons.

I ask the Minister to give a categorical assurance on the concerns raised by hon. Members on both sides of the House. I particularly welcome the comments from the hon. Members for North Antrim (Ian Paisley) and for Blaydon (Mr Anderson) and my right hon. Friend the Member for Bermondsey and Old Southwark (Simon Hughes), who raised questions that have not yet been fully answered. My hon. Friend the Member for Argyll and Bute (Mr Reid) and the hon. Members for Stevenage (Stephen McPartland) and for Banff and Buchan (Dr Whiteford) also raised concerns.

[Simon Hughes]

I pay tribute to my hon. Friend’s work on this matter. I have had a chance to check the answer to the question from the hon. Member for West Dunbartonshire (Gemma Doyle). If the amendment were accepted, it would immediately transfer the people in question out of the civil service definition. They would get the benefit of an earlier retirement age, but they would also get the disbenefit of other comparative advantages. That is why we need a negotiated conclusion, not one-line changes to the Bill.

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[John McDonnell]

Today we have at least set out the parameters of what the negotiations will be. The age of 60 has to be No. 1 on the agenda, followed by ironing out other anomalies. The second issue is the point I raised in an intervention on the Minister. We have to have a clear definition of the legislative process by which the negotiated settlement will be speedily agreed through the House. Will it be tacked on to other primary legislation or might there be a speedy regulation change that enables us to implement the process?

[Simon Hughes]

I, too, pay tribute to the hon. Gentleman for the work he has done. I share his view that it would be helpful if the Minister indicated in the winding-up speech that there will be a fixed timetable for concluding the process and that the age change from 65 to 60 would be on the agenda. If he can do that, I think that realistically, given that we are at the beginning of this financial year, that would be acceptable. I have not cleared that with the unions, but we need something that gives some parameters and the Minister would carry us with him if he set them.

[John McDonnell]

To go back a bit, I would also like some clarity about the legislative process. The time scale for negotiations can be set and the agenda for those negotiations clarified; my anxiety is that if we do not have a commitment on the time scale for legislation, the issue could be kicked into the long grass or even further. That would be seen by the workers as an act of bad faith unless a clear timetable was also given for the legislative process.

[Simon Hughes]

I have one quick thought—I am trying to be helpful. In every year there is inevitably a Finance Bill. This is a Treasury matter and could therefore be covered in the new Session by the Finance Bill.

[John McDonnell]

That is all I am asking for: clarity of process and time scale. It would be extremely helpful, as an act of good will and good faith, for the Minister to take back a reference to this matter in the Queen’s Speech. That would indicate to those involved that the Government attach a priority to ironing out what has been accepted as an anomaly. It is one that might affect only a relatively small number, but it does so critically and in a critical service, as others have said.

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[Sajid Javid]

I thought I made myself clear but I will say it again: it would not require primary legislation if the MOD decided it was appropriate and right to make any changes to the retirement age.

[Simon Hughes]

The Minister is being very helpful. In answer to an earlier question, he alluded to the timetable that has started. Would it be reasonable to assume that the negotiations are intended to be concluded by the MOD during this financial year at the latest?