| Armed Forces (Pensions and Compensation) Bill
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Mr. Brazier: My hon. Friend is making a powerful speech. He made the point that the Government of the day should have the interests of the armed forces at heart. I had to leave the Committee for a few minutes, so could my hon. Friend tell me whether the Minister has yet responded to the point about accrual rates for existing servicemen who choose to stay in the existing scheme? Column Number: 64 Mr. Howarth: I can tell my hon. Friend that the Minister responded to that point, but not adequately. We are, I hope, going to debate that matter when we discuss the amendments tabled by my hon. Friend, and I do not want to detain the Committee on that point now. We acknowledge that new schedule 3 is inadequately drafted: indeed, we lifted the whole thing from the Government's own document to give us some meat to bite on, as the hon. Member for South-East Cornwall (Mr. Breed) put it. We do, however, believe that some cardinal principles should be enshrined in the Bill, since the Government are laying a brand new law before us to stand on the statute book for goodness knows how long. It is right that the Government should take the opportunity to ensure that specific cardinal points are written into the Bill. We do insist on that, and will seek to divide the Committee on amendment No. 2. My hon. Friends the Members for Canterbury, for New Forest, West and for Blaby (Mr. Robathan) have made important contributions to the debate. My hon. Friend the Member for Canterbury pointed out the cost of housing—a material consideration. We welcome the suggestion that the Minister made on Tuesday that the Government hope to propose some measure that might alleviate the difficulty faced by servicemen and women in obtaining accommodation when they leave the service. It particularly affects those serving in the Army—not so much those in the Navy and the Royal Air Force. Can the Minister give us more detail? Mr. Caplin: I heard what the hon. Member for Canterbury said, and I thought, looking at the group of amendments, that it would be better dealt with under clause 1 stand part. Mr. Howarth: I am entirely content with that. The Committee looks forward to hearing what the Minister has to say. The Chairman: Order. I shall make a brief statement. I was not here on Tuesday, but I see that over two hours was spent discussing the amendments. That debate is continuing now and we have another three sets of amendments to discuss on the clause, so there is a good chance that the Chair might feel that there is no need for a stand part debate. Mr. Howarth: I am sure that the Minister would like to sort us out now, and to tell us exactly what he proposes. Mr. Caplin: I am not sure that this is the right place to deal with it, but I shall be aware of your words, Mr. Griffiths. The trouble is that clause 1 stand part was my best-prepared speech. Mr. Howarth: In that case, Mr. Griffiths, I hope that you will indulge the Minister, so that the entire Committee may enjoy his best-rehearsed speech. Shona McIsaac (Cleethorpes) (Lab): Perhaps he could post it to us. Column Number: 65 Mr. Howarth: The hon. Lady is extremely uncharitable in suggesting that the Minister, in his distinguished role, should not be allowed to have the Floor, but should instead commit to writing his wonderful, emotional and rhetorical speech to which we are now all looking forward with bated breath. Mrs. Claire Curtis-Thomas (Crosby) (Lab): We could read it in bed. Mr. Howarth: I am sure that sleeping pills would be better. My hon. Friend the Member for New Forest, West made a number of interesting points. I hope that the Minister will clarify my understanding. I think that he said that, to deal with the pension trough that occurred in the 1970s, it is proposed that the best of three years will be taken in determining the final salary upon which the pension is to be based. Mr. Caplin: Yes. Mr. Howarth: The Minister is indicating that that is correct. That is extremely welcome. My hon. Friend the Member for New Forest, West made a very good point about the fact that this should be a contributory scheme. The Minister did not deal with that very successfully. Many in the armed forces would welcome the opportunity to contribute, because that would advertise to the public the fact that they pay in to the scheme. They might be thought not to pay in, because it is non-contributory, whereas we know that the technicality is that the Armed Forces Pay Review Body abates their pay by 7 per cent.—that is the current rate—to reflect the fact that they do not otherwise pay into a contributory scheme. My hon. Friend the Member for New Forest, West is right. There would be additional advantages in that, as the scheme is not funded, there is no loss to the Government if people take their pension away and place it elsewhere. Specialist pay is increasingly a part of the main body of pay of members of the armed forces. I am sorry that the Minister has rejected that element as being ineligible for pension payment. The more it becomes necessary for the armed forces to pay supplements to attract or retain specific skills, the more the Minister will have to keep that under review. I think of the mobile phone industry's requirement for signallers a couple of years ago; they were in huge demand and the Army had difficulty in retaining those guys. We will certainly hold him to account on that.
9.45 amThe hon. Member for South-East Cornwall made some important points, particularly about cost-neutrality. My hon. Friends have also raised the issue and the Defence Committee felt strongly about it, although I shall not go down that route too far because I raised the matter last week. However, on the one hand, the Government wish to advertise their concern for the armed forces by saying that they want to produce a better scheme, while on the other hand they Column Number: 66 are saying, ''Sorry lads, this is cost-neutral and any improvements in the benefit will have to be paid for elsewhere.''Mr. Swayne: My hon. Friend may recall that last week I asked about the extent to which Ministers had considered that overall constraint of affordability. There are many things that we would like in the scheme that would breach that principle. Given that, I wanted to know whether Ministers had considered consulting members of the armed forces widely to discover whether they would prefer to secure the extra benefits either through a larger abatement of pay or through a more comprehensive scheme and a better menu of additional, voluntary contributions. Even if the Minister did not answer that in his winding-up speech, it would be an interesting debate. Mr. Howarth: We are, I hope, going to debate the transitional arrangements under new clause 8, which we have tabled, for which I hope the Minister and his officials are prepared. He will find that precious few members of the armed forces have any idea what the Government propose, let alone how it will affect them individually. However, I shall return to that point later in our proceedings. I was talking about the contribution made by the hon. Member for South-East Cornwall, who has now been replaced by the hon. Member for Hereford. The hon. Member for South-East Cornwall talked about cost-neutrality, but the Government gave the game away as late as last December, in their response to the Defence Committee, when they said:
The hon. Member for Dunfermline, West (Rachel Squire) was right on Second Reading to point out that the Government's consultants had said that the benefits for those who serve for a short time will ''look increasingly less generous''. The scheme does not produce all-round improvements in benefits, as the consultants suggest. Mr. Swayne: My hon. Friend began on the strong point that the armed forces are different and need to be treated in a unique manner. In one sense, the Bill and the new scheme will, regrettably, continue to ensure that those in the armed forces are unique, in that they will be the only group who will not be able to secure a full two-thirds pension at the end of their careers. That is principally because of the cost of the early departure point.I asked whether the Minister could justify the fact that the members of the scheme have to pay for that, when it is almost wholly the result of the Government's own manpower planning and retention requirements; to draw people through when they are Column Number: 67 approaching their 40th year. As that is largely an Army manning requirement, surely the scheme should pay for it, rather than the beneficiaries.The Chairman: Order. A number of interventions this morning have been in the nature of brief speeches. I would prefer interventions to be brief. Mr. Howarth: Thank you, Mr. Griffiths. I agree with my hon. Friend and I know that he will have an opportunity on new clause 19 to develop those arguments further. The Minister said earlier that the Government could not allow for a full career pension because basically there was no funding for it. My hon. Friend is right that both the immediate pension and the early departure scheme are manning control tools for the Government's benefit. They are not specifically for the benefit of the members; they are principally for the benefit of the employer, in this case the Government. Mr. Caplin: I promise to be brief, Mr. Griffiths. I must take up with the hon. Gentleman what he says I said. We do not have the benefit of instant Hansard records, but I do not think that the comments that he attributed to me were accurate.
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