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Mr. David Rendel (Newbury): I beg to move,
That an humble Address be presented to Her Majesty, praying that the Local Government (Compensation for Redundancy) Regulations 1994 (S.I., 1994, No. 3025), dated 28th November 1994, a copy of which was laid before this House on 5th December, be annulled.
I am delighted to have this opportunity to move the motion on the Order Paper standing in the name of myself and my hon. Friends. It is not often that the Liberal Democrats have an opportunity to initiate a debate in the House. [Interruption.]
Madam Speaker: Order. Liberal Democrats will not only initiate a debate; they will be heard in the House. Will Members who are leaving do so quickly? Close the doors so that we can hear what the hon. Member for Newbury has to say.
Mr. Rendel: I am especially pleased that we have today an opportunity to bring before the House a matter of such crucial importance. It is crucial not just to the individuals in local government who may be unfortunate enough to lose their jobs through redundancy but to the whole process of local government reform itself.
The regulations that the motion seeks to annul are unfair, inadequate and unlikely to attract sufficient numbers of voluntary redundancies. It is, therefore, important that the House should have a chance to debate them. I hope that as a result of the debate the Government will accept the annulment and return with an improved set of regulations as soon as possible. As the regulations cover England and Wales, but not Scotland, I hope that the annulment, which will result if the motion is passed later tonight, will persuade the Government to withdraw the equivalent set of regulations in Scotland.
The regulations have three main purposes: part II puts in place a scheme for redundancy payments above the statutory minimum for cases of redundancy that are separate from those caused by the reorganisation of local government. Part III deals with redundancy payments and early retirement for employees who lose their jobs as a result of local government reorganisation; and part IV seeks to overcome some of the difficulties caused when the notorious north Tyneside judgment led to an unforeseen reduction in the level of pension for some ex-local government employees, who had previously been made redundant or who left in the interests of the efficiency of the service.
Most of my remarks this evening will be directed towards part III, but it may be appropriate at this point to begin with a few remarks about the inaccuracies of parts II and IV.
First, I pay tribute to the various bodies which have done their best to provide the Government with what would have been an acceptable set of regulations for local government redundancies. The local government associations, the Staff Commission and Unison in particular have all done valuable work in making sensible proposals and, in doing so, have given me invaluable support in considering how to react to the Government's response.
Those bodies consider part II to be the least unacceptable part of the proposals. Unison is unhappy that some degree of discretion is allowed to local councils by
Column 241part II, but it is largely welcomed by the local authority associations. There is good reason to support some discretion in cases where we are not dealing with a large scale redundancy programme, as we may well be during the period of local government reorganisation.
However, it is greatly to be regretted that that discretion is fettered to the extent that the maximum payments allowed under that part are still well below payments which are being offered to civil servants in many cases.
Mr. Allan Rogers (Rhondda): I congratulate the hon. Gentleman on bringing such an urgent matter to the attention of the House. Is it not extraordinary that in Wales the level of payments given to redundant local government officers will be even lower than in England to start with and, even more extraordinary, to emphasise the point that has just been made, civil servants in the Welsh Office, perhaps with a similar experience and background to those in local government, will receive about £72,000 in redundancy pay, whereas the equivalent in local government will receive as little as £29,000? It is extraordinary that the Secretary of State cannot control his own Department while doing this to people in local government.
Mr. Rendel: I feel at least as sorry for the Welsh as I feel for the English in this case. Surely, in considering the different merits of civil servants and local government officers, the Government should recognise that what is sauce for the goose should also be sauce for the gander.
The attempt in part IV to overcome the problems produced by the north Tyneside judgment is also welcome in so far as it goes, but it is no better than a half-hearted and partial solution to the problems. Not all those affected will be covered by the new measures and those who are affected will, for the most part, not be fully compensated.
The fact that the compensation is discretionary is, in this case, simply a temptation to those local authorities which tend not to act in a responsible way in relation to their staff. After all, these are staff who, by definition, finished their service with the local authority some time ago. Clearly, the pressure on the local authority to treat them properly is so much reduced that we would be foolish to allow an unnecessary level of discretion in this case.
The Government should have put the pensioners affected back in the position that they were in before the north Tyneside judgment was made. That would have been the fair way to deal with the situation. After all, it is not the pensioners' fault that the law was misunderstood by those who should have known better. The pensioners should not now have to pay any of the costs of that misunderstanding.
I come now to what most of us consider to be the heart of the regulations, or at least the section which has the greatest importance for the immediate future--the section which deals with local government reorganisation. Sadly, not only is part III the heart of the regulations, but it is the part in the greatest need of significant amendment.
The first and most telling criticism of all is that the maximum level of payments to be made under the regulations is, quite simply, far too low, especially in relation to precedents set in previous episodes of local government reorganisation and by the modern day civil service.
Column 242For example, the maximum level set in the 1986 reorganisation for a 49-year-old with service throughout his or her career was 82 weeks' pay compared with a maximum of 66 weeks' pay under these regulations. It might be said that those were different, easier times, when the country could afford more; times when it was not so necessary to watch every penny. Is that the Government's argument? Are they really arguing that the economy has got steadily worse in the past 10 years of Conservative rule, so we can now afford to pay people only 80 per cent. of what we could afford to pay them 10 years ago? Surely not.
Mr. Alex Carlile (Montgomery): A few moments ago, the hon. Member for Rhondda (Mr. Rogers) made a valid point about the redundancy pay level available to local government employees in Wales. Does my hon. Friend accept that a further problem is overlaid on the quantum and it especially affects local government officers who face redundancy in rural Wales? They face the grave problem of finding new jobs, if they have lived in a rural area for the past 15 or 20 years, and if their families have settled in those rural areas. Does my hon. Friend think that a strong case exists for protecting in particular those many local government employees in rural mid -Wales, who face terrible uncertainty and financial loss?
Mr. Rendel: Indeed. I accept the point made by my hon. and learned Friend. His case is all the stronger in that Wales has not been treated in the same way as England. Wales went through its organisation process by diktat of the Minister, rather than by a process of agreement by the people of the country.
The argument that the Government might think that we are now poorer is, in some ways, refuted by what is happening in the civil service. The very same Treasury mandarins who insist that 66 weeks pay must be the maximum for local government officials, have managed to negotiate a package for redundancies from their own Ministry which, I understand, amounts to a maximum payment of no less than 156 weeks pay. That, however, is not the only fault in part III of the regulations, even if it is the most obviously hypocritical. I welcome the fact that the Government have decided that the scheme to be introduced for people under 50 is to be mandatory. In a major reorganisation of this sort, it is right that all employees who stand to be made redundant across the whole country should know what to expect by way of compensation. Nothing is guaranteed further to inflame an already emotive situation than for different councils to offer different redundancy terms as they go through the same trauma of reorganisation.
The fact that the Government have been forced to recognise the strength of that argument for people who are under 50 makes it all the more strange that they have failed to recognise that the argument is just as strong for people who are over 50. That is another serious fault in the regulations and another reason why the annulment should be agreed tonight, so that the Government can introduce a new set of regulations to ensure that all local government employees are fairly treated and have a clear picture of what their rights are. A third problem lies in the failure of the Government to introduce any special provisions for people in the age bracket of 40 to 49. Unfortunately, I have been in the position of trying to find work when aged over 40. Who knows, had it not been for the people of the Newbury
Column 243constituency asking me to carry out my present responsibilities, I might still be looking for work. Besides, I am sure that all hon. Members have come across several constituents who have complained to them bitterly about the ageism of employers, about the way in which, in some careers, it is now almost impossible to get even an interview, let alone to get a job, once one has passed the magic figure of 40. There is a pressing need, therefore, to make special provision for people who are in that especially difficult part of their careers. They are far too young to retire--what a waste it would be if retirement were their only option--and yet they are old enough to find it desperately difficult to find another job.
Finally on part III, there is the inadequacy of the provisions for people whose work for local government has, so far, been limited either because they are part-timers, or because they have only recently taken up their local government employment. Those people, more often women than men, do not deserve to be neglected just because they have not yet had the chance to put in a long period of service. Their needs should be provided for in the regulations. Why is this all so important? Whenever we think of the local government reorganisation shambles, as it has turned out to be, we must all hope that the process, whenever it does go ahead, proceeds as smoothly as possible. We must hope that, not just for the sake of the employees concerned as they go through what will no doubt turn out to be a very traumatic period for some of them, but, perhaps even more important, for the sake of all the recipients of local authority services--residents of local authority areas, many of whom are the very people who elected us to speak for them here. Many of those people fear that local authority services will be disrupted by the reorganisation.
One way in which we can allay some of those fears is to ensure that, where redundancies and early retirements are necessary, they take place smoothly and with the maximum acceptance by the employees involved. Surely experience has taught us that to offer redundancy terms less good that those that have been offered in similar circumstances in the past is a sure way to create discontent and low morale. That is true not only of those who are eventually forced to accept the terms but--this is important--of those who are left behind. If the Government sincerely want local government reorganisation to be a success, one of their first tasks should be to improve the regulations to ensure that all the redundancies that it is expected to cause can be voluntary rather than compulsory.
Although this is not at the heart of the debate, let me say in passing that the Government's failure to provide adequate funds for the costs of local government reorganistion in areas such as Berskshire where, on top of the transitional costs, there are expected to be on-going costs rather than on- going savings--can serve only to exacerbate the problem of redundancy costs. Indeed, it may even force some councils to use the discretion that the Government are giving them to minimise redundancy payments, which can only make the problem of inadequate payments even worse.
We see, then, just how fundamentally the regulations demand to be improved: indeed, I believe that the very success of local government reorganisation hangs on their being improved. This is another example of how the
Column 244Government have got it in for local government, and local government officers, in a big way. What is it about local government that makes this Conservative Administration hate it so much? Could it be that the Government know that the number of Conservative councillors is falling year by year, and that most of the seats are being taken over by Liberal Democrats?
Whatever it is, the Government would be well advised to admit tonight that the regulations are nowhere near adequate. If they refuse to vote to annul the regulations--as my hon. Friends and I will--they will find that their decision traps them yet deeper in the mire into which they have fallen over the whole question of local government reform. Tonight, the Liberal Democrats have provided the Government with an opportunity to overcome the difficulties in which the regulations will land them otherwise; they should seize that opportunity with both hands.
Mr. Roy Thomason (Bromsgrove): I am surprised by the prayer, and by the comments of the hon. Member for Newbury (Mr. Rendel)--although I congratulate him on moving the motion and giving us an opportunity to debate it.
I am surprised first by the hon. Gentleman's claim that the local authority associations do not support the proposals, because I have a piece of paper from the Association of District Councils that suggests that they do support them. Secondly, I am surprised that the Liberal party--which began the week with a demand for the Labour party to come clean over its spending plans, and sought to cost the expenditure of that same party only a few days later--should seek to increase public expenditure as it is tonight. Is there much difference between the two Opposition parties?
Thirdly, I am surprised because it appears that Unison has yet another spokesperson on the Opposition Benches. Fourthly, I am surprised that the hon. Member for Newbury seems to think that one can make an argument in favour of increasing expenditure and improving conditions of employment by mounting one settlement upon another. We know that is the very reason why inflation has gone out of control in the past.
One cannot take the civil service settlement and seek to improve on it, because in turn somebody will come along with an attempt to improve it further, which leads inevitably to escalation. [Hon. Members:-- "Why not?"] I hear the cries of the Opposition. That way leads to ruin, because each settlement is taking more public expenditure than the previous one, and adds more to inflation, step by gruesome step.
Mr. Rogers: Why does not the hon. Gentleman follow the logic of his own argument and attack the Ministers who agreed to the civil service settlement, rather than trying to exploit people in local government who have no real voice? If there is a bad settlement--the hon. Gentleman seems to think that the civil service settlement was bad--why does he not criticise Ministers?
Mr. Thomason: I did not say that the civil service settlement was a bad one. My argument is that the Labour party--and apparently now the Liberal Democrat party--
Column 245is seeking to use one settlement to step above another to increase public expenditure. That is the old story which we have heard so often.
Mr. Oliver Heald (Hertfordshire, North): Does my hon. Friend agree that the McKinstry memorandum in The Spectator , in which Leo McKinstry described the way in which the Labour party has operated in local government and said what a great indication that was of what it would be like in government, goes very much to the heart of the issue and explains the parrot cries from Opposition Members?
Mr. Thomason: My hon. Friend is right.
I do not wish to detain the House, so I shall briefly ask my hon. Friend the Minister whether he can define "material date" for the purposes of the regulations, and whether he can confirm that the regulations are improving local discretion by giving power to local government to make decisions. Can he also confirm that the national joint negotiating bodies are likely to meet later this week to agree tariffs for the over-50s that are generous, and to agree to settle terms that some of us consider to be more than fair? Can he further confirm that meetings are taking place on 26 January between the local authorities and the unions, which could give a guaranteed offer of new jobs after reorganisation to those who want them? Will not that answer the criticisms raised by the hon. Member for Newbury? Does my hon. Friend agree that the present proposed costs--not any enhanced costs--of this provision could be met by savings that will be generated from the local government review? Does he further agree that this measure should be welcomed on both sides of the Chamber as being in the interests of local government employees?
Mr. Frank Dobson (Holborn and St. Pancras): Tonight the House has a very clear choice. We are dealing with the future of people who will lose their jobs in local councils through no fault of their own, either through general redundancy or through the local government reorganisation that the Government are pushing through. The question is whether such people should get a fair deal, and the choice before the House tonight is whether people are treated fairly or meanly. The choice is not between a generous settlement and a mean settlement--it is a much narrower choice between a fair settlement and a mean settlement. Needless to say, the alternative that the Government are proposing tonight is a mean alternative. We all know that the Government are extremely generous to rich people, and that they are happy to pour money into the pockets and handbags of the bosses of privatised industries. They look after themselves rather nicely, and they are very mean to people who cannot fight back. The regulations cover three categories of staff--staff who are likely to be made redundant by the local government review, staff who may be made redundant generally and pensioners whose pensions were cut as a result of the court decisions on North Tyneside. First, on the local government review, contrary to what the hon. Member for Bromsgrove (Mr. Thomason) said, the staff are not seeking any leapfrogging improvement
Column 246on what has gone before. They are simply asking for a settlement along the lines that the Government conceded in 1986, when the metropolitan counties were abolished--the terms agreed by Margaret Thatcher. One might summarise it by saying that the deal that she put together, John Major has decided to put asunder. The settlement can thus be simply categorised as meaner than Thatcher, and it is difficult to think of anything meaner than that.
The settlement is not merely meaner than Thatcher, but worse than what the Staff Commission recommended to the Government, worse than the terms offered to the civil service, and worse than severance payments paid to other categories of people for whom the Government are responsible. The boss of Severn Trent Water, for example, got £512,000 as part of his severance agreement, which was entirely the Government's responsibility as they passed the legislation that enabled him to pay himself that enormous amount.
If someone is made redundant as part of the local government review, the regulations allow maximum compensation of 66 weeks, which compares with the 82 weeks to which Mrs. Thatcher agreed in 1986 and which the Staff Commission recommended, and the 156 weeks that this Government and these Ministers have agreed will be available in the civil service.
Let us consider an example of what will happen in Wales as a result of the regulations. Under the civil service severance agreement, a 45-year-old civil servant in the Welsh Office with 26 years' service, earning £23,000, will get £71,000, but a local government officer in Wales, aged 45--perhaps the civil servant's twin brother or sister--and earning £23,000 after 26 years' service, would get £29,570 at the most, which cannot be fair or reasonable.
The scheme is mandatory only up to the age of 50, or for people over that age who are not entitled to a pension when they give up work. It also provides some special arrangements for people who are entitled to a pension. Once again, the Government have chosen the mean-minded alternative. Generally, those over 50 who are entitled to a pension will receive only statutory redundancy pay because the Government have apparently decided that the pension, which people have worked and paid for, should be taken into account when they allow a special severance payment as a result of a local government review that they introduced. People who are paid a salary will have to live on a pension and statutory redundancy, without the Government making up any of the difference.
The Government and the hon. Member for Bromsgrove, who is supporting them, claim that they cannot afford better terms. Presumably they think that, from a Government point of view, times are harder than they were in 1986.
There are two choices. No one knows how many people may be made redundant as a result of the local government review. If it is to be a large number, massive savings in expenditure will result in the years to come and it would surely be easy to find the money to pay a decent severance payment out of those savings. If few people are to be affected by redundancy, the sums will be so trivial that it will be equally easy for the Government or local government to find them. The second aspect of the regulations is the enhanced payment for people made redundant because of changes in the internal organisation of their council. I admit that
Column 247the regulations improve the maximum under such arrangements, from 24.5 to 66 weeks, but that is not the 82 weeks for which the staff have been asking, and it is not mandatory. The payments are entirely discretionary and, given the choice between a fair and a mean arrangement, yet again the Government have chosen a mean one. The third aspect is the North Tyneside judgment. When the district auditor went through North Tyneside council's books, he said that enhanced severance payments and top-up retirement bonuses given to staff were unlawful. That has left existing pensioners, not just in north Tyneside but in other parts of the country, who retired in good faith with a higher pension as part of those agreements, with lower pensions. Indeed, some of them have been asked to pay back the lump sums that they received. All those involved in those
agreements--employers and employees--were acting in good faith and believed that they were acting lawfully at all times. Councils of all parties believe that to be the case.
One of the areas most affected, which is dear to the hearts of Tory Members, is Tory Westminster council. It agreed to some of the biggest enhanced pension arrangements and pay-offs when people left local government service of any council in Britain. Some 600 of its former staff- -now its pensioners--are now faced with substantial reductions in their living standards. The same applies to agreements with the then Tory Hillingdon council.
Everyone agrees that the matter should be put right. What everybody thought was lawful and reasonable should be made lawful and reasonable. But it is not being made so by the regulations, which fail to put pensioners in the position that they thought they were in before that unexpected judgment.
In passing, I comment on the strange inconsistencies of the district audit service, which for years said nothing about those enhanced payments. In the year when district auditors in North Tyneside identified the payments as unlawful, the district auditors in Hillingdon and Westminster apparently still saw them as lawful. We need more consistency in the system.
Furthermore, the arrangements are not mandatory. Whether Westminster pensioners get back even what is permitted under the regulations is entirely in the hands of Westminster city council, from which we can expect no sensible decision. In other councils, all the money that pensioners have lost will not be made up. Indeed, the judgment may affect other pensioners who were paid off before the period covered by the regulations, and they may still lose. Once again, these are sloppily drafted and mean-minded regulations. What the Government are doing might be described as "a Maxwell" on the pensioners, but in this case it is by statutory instrument. Various people advise me that aspects of the regulations are technically unsound and may lead to the Minister having to come back within a very short period to put them right. My Welsh colleagues want to know why the period covered by the regulations is 18 months in England but only 15 months in Wales.
The regulations are mean to council staff who lose their jobs through no fault of their own. They are in marked contrast to the generous attitude that the Government have towards themselves and their colleagues. Since the settlement in 1986, the Conservatives have introduced and benefited from ministerial severance payments. Those are
Column 248made to people who lose their jobs not through no fault of their own but either because even the Prime Minister finally recognises that they are totally incompetent or because they are up to something, financially or with somebody who is not their spouse. Those seem to be the reasons why Ministers lose their jobs, yet they get severance payments in those circumstances.
The other part of the ministerial severance package is that Ministers then go on to jobs in the City with Barclays bank, in industries that they have privatised, or in merchant banks that have taken part in the privatisation process. The Government are very generous to themselves but mean to everybody else. The regulations are typical of what they are up to, and people are sick of it. 10.49 pm
The Minister for Local Government, Housing and Urban Regeneration (Mr. David Curry) rose --
Mr. Anthony Steen (South Hams): On a point of order, Mr. Deputy Speaker. As a defender of Back Benchers, do you believe that in a debate of one and quarter hours it is appropriate that there should be three opening speeches and three closing speeches from Front-Bench spokesmen? Do you think it appropriate that we should have had just one speech from a Conservative Back Bencher and not even one from an Opposition Back Bencher? That is an abuse of parliamentary procedure and I ask you to protect Back Benchers on both sides of the House from such abuse.
Mr. Deputy Speaker (Mr. Geoffrey Lofthouse): That point of order has been noted.
Mr. Curry: This is a serious matter because people's livelihoods are affected and they are naturally anxious. It merits a serious debate.
Although I do not agree with the conclusions of the hon. Member for Newbury (Mr. Rendel), he treated the subject seriously. The hon. Member for Holborn and St.Pancras (Mr. Dobson) has a particular talent for disfiguring any subject with which he comes into contact--mainly, it must be said, as a pretext for his failure to understand the substance of it.
Local government reorganisation is at an advanced stage. The commission has submitted final reports for all 39 shire counties and the Cleveland order has been approved by both Houses. I know that the hon. Members for Hartlepool (Mr. Mandelson) and for Middlesbrough (Mr. Bell) are looking forward to joining their colleagues in the Lobby tonight.
We are consulting on draft orders to implement changes in Avon, Humberside and York and we are aiming to seek parliamentary approval soon, in time for elections to be held in May. Further orders will be laid as decisions are taken.
Change is a normal part of local government. The search for efficiency, the changes in function and the growing success of the role of local government as an enabler has inevitably meant that there will be different staffing requirements. No organisation can petrify its structure if it is to respond to public needs and its own search for greater efficiency.
That is the context in which the new local government compensation regulations have been introduced. Those regulations are not confined just to local government
Column 249reorganisation, but, as hon. Members have already noted, they achieve three things. First, they provide a better and more flexible general compensation scheme, for which local authority employers have long asked, for use in all cases--not just reorganisation. Secondly, we have made special extra provisions to suit the particular circumstances of local government reorganisation, reflecting the key role to be played by local government staff in the transition to restructured authorities.
Thirdly, we have provided the means for compensation to be paid to those pensioners who are adversely affected by the North Tyneside Court of Appeal judgment. Only one of the three elements covered in the regulations therefore refers to local government reorganisation.
Mr. William O'Brien (Normanton): Will the Minister give way? Mr. Elfyn Llwyd (Meirionnydd Nant Conwy) rose --
Mr. Curry: I will give way, but you, Mr. Deputy Speaker, no doubt want me to press ahead in the interests of Back Benchers.
Mr. O'Brien: If the Minister will not accept the annulment of the regulations, will he support those local authorities that are involved in the reorganisation of local government which do not wish to make people compulsorily redundant? Would he agree to negotiate a national agreement on severance and conditions for those who agree to leave their employment voluntarily?
Mr. Curry: It is entirely up to a new council to make staffing dispositions; the Government do not intend to lay down whether redundancies should be compulsory or voluntary. It is up to councils to seek the changes by the methods which they arrive at. That is what the principle of allowing local authority discretion means. I understand that the negotiating body is likely to agree soon that the discretionary awards in the regulations will be paid at the maximum. That could obviously benefit the over-50s and the other groups covered by the regulations.
Mr. Llwyd: Can the Minister explain why Wales is being treated differently? Is he aware that, during the passage of the Local Government (Wales) Act 1994, the implications of reorganisation were raised time and time with Welsh Office Ministers? Assurances were given about improving conditions and so on, but to date nothing has been done. We have been badly treated by the Government.
Mr. Curry: The hon. Gentleman knows that there are some differences between England and Wales.
Mr. Curry: If the hon. Gentleman will wait, I will tell him. The first difference is that the prescribed period to which part III applies in England is 18 months after the vesting day; in Wales, it runs from three months before to a year after. That is the result of a consultation that was undertaken. In Wales, the consultation resulted in the choice of that formula; in England, people preferred a
Column 250different period. The United Kingdom has constituent parts which have their own characteristics, so I see no problem in that. Mr. Nick Ainger (Pembroke) rose --
Mr. Curry: I have not finished the answer to the first intervention yet.
As far as the other condition is concerned, loss of employment in Wales must be attributable to provisions made under the Local Government (Wales) Act 1994, because it is intended to target part III to staff losing their jobs because of reorganisation, and not for other reasons.
I think that you would want me to make progress, Mr. Deputy Speaker, in view of the comments made by my hon. Friend the Member for South Hams (Mr. Steen).
As I said, we have made additional provision because of the specific circumstances of reorganisation. I have also mentioned the North Tyneside position.
The regulations provide new and significantly improved compensation terms for local government staff in England and Wales in cases of redundancy, which may occur as part of the normal operations of local government. Before the regulations came into force, local government employees aged below 50 could receive only the minimum statutory payments on redundancy. The most that could be given to an employee under the age of 50 was 24 weeks' pay. Under the new regulations, for all future general cases of redundancy, local authorities have the discretion to make payments of up to 66 weeks' pay for employees, based on a tariff according to age and service.
Employees aged over 50 have, for many years, had a better deal than those aged below 50. If they have two years' service, they are entitled to immediate payment of their pension and pension lump sum. In addition, if they have at least five years' service, they may receive a discretionary top-up to their pension benefits. That provision has not changed. Local government employees aged over 50 facing redundancy as a result of normal change in local government can still receive those benefits.
As well as introducing significantly better severance terms for general cases of redundancy, the regulations provide extra benefits for employees made redundant from local government service specifically as a result of local government reorganisation. Those benefits are, first, that the maximum amounts permitted under the 66-week tariff are mandatory for staff aged under 50 affected by reorganisation. [Hon. Members:-- "How much?"] They are maximum and mandatory. Secondly, for the over-50s made redundant in reorganisation cases, there are options for further compensation payments at the employer's discretion. I shall say more about that later.
Mr. Paddy Tipping (Sherwood): Will the hon. Gentleman give way on that point?
Mr. Curry: If I can make progress, I will return to that later. We have also taken the opportunity provided by the regulations to provide local authorities with new powers to enable them to compensate those of their pensioners who suffered reductions in their pension payments as a result of the 1992 Court of Appeal decision in Allsop v. North Tyneside Metropolitan Borough Council. As hon. Members will recall, that judgment declared unlawful the
Column 251local severance scheme operated by North Tyneside council and, as a consequence, several councils had to terminate pension claims made under their local schemes--although I have not heard of cases of pensioners being required to pay back lump sums. If my hon. Friend the Member for Mid-Kent (Mr. Rowe) has specific references to that, I will be pleased to receive them.
Many of those pensions, which authorities had agreed, had been in payment for some years before being reduced. Some of those pensioners have had to wait more than two years for compensation, and the new powers that we are giving to local authorities will be widely welcomed.
All those new provisions, which flow directly from discussions that we have had with the Staff Commissions, the local authority associations and the Local Government Management Board, incorporate the results of two extensive consultation exercises among all interested parties, and provide the framework that local government has sought.
We have modified our proposals substantially in the light of the consultation exercises. Specifically, we have amended our proposals to make a mandatory arrangement for reorganisation cases.
Mr. Steen: I am most grateful to my hon. Friend for giving way, because the matter that I wish to mention will not come out in any other way. The Prime Minister said last year that there would be fewer rules and regulations in the House. There were going to be fewer rules and regulations on the Floor of the House, fewer rules and regulations upstairs and fewer downstairs. Yet every time that I enter the Chamber, there is another rule or regulation. Why do we have to take this course tonight? Only the other day I was dealing with the town and country planning regulations; now we are discussing another regulation. Is the deregulation arrangement working in the Minister's Department?
Mr. Curry: The answer to the second question is yes. The answer to the first question is that, if there is reorganisation, one has to make provision--as has been made in the past--for those people affected by it. We have taken advantage of that fact to enhance the conditions for all local authority members. My hon. Friend will appreciate that it is relatively unusual now to be here at nearly 11 pm, and perhaps we have become accustomed to slightly soft ways in the House.
Mr. Steen: Wednesday mornings and Friday mornings?
Mr. Curry: My hon. Friend is a slave to duty.
Mr. Tipping: Although the Minister has amended the regulations to take account of criticisms, will he explain why the figure given now is 66 weeks when, back in 1986 when the metropolitan counties were abolished, 82 weeks redundancy payment was offered?
Mr. Curry rose --