House of Commons Hansard Debates for 4 Jul 1995

Mr. Hague: I begin by assuring the hon. Member for Southwark and Bermondsey (Mr. Hughes) that we on the Conservative Benches are as relaxed and enthusiastic as ever this evening, and in the spirit of agreement across the House that we had in dealing with new clause 21, which was proposed by my hon. Friend the Member for Dorset, West (Sir J. Spicer), I deal first with Government amendment No. 84, to which no one has yet referred in the debate, but which is grouped with the new clauses.

Government amendment No. 84 extends clause 165 to Northern Ireland. It deals with the effect of remarriage on war pensions for widows. As the armed forces of the Crown, including war pensions, are an accepted matter under the Northern Ireland Constitution Act 1973, it is appropriate for clause 165 to extend to Northern Ireland. The background to the other new clauses is the substantial change in war widows' pensions that is already part of the Bill. The DSS war widow's pension is awarded to the widow of a man whose death is due to any service in the armed forces; to most that is worth about £143 a week, and is tax free. As a pension for the maintenance of the widow, it is withdrawn on remarriage and currently there is no provision for it to be restored later. As a result of debates here and in the other place, however, it became clear that the current position was unacceptable, and we therefore decided to restore the pension in certain circumstances.

That amendment is now part of the Bill. The Government amendment that I moved in Committee, which tidied up that provision, goes further than the Lords amendment: it includes, for instance, the widows of certain merchant seamen, civilians and Poles who served under British command during the last world war, and ensures that the war widow's pension is restored in the event of a second bereavement or failure of a second marriage--and, moreover, that it is restored in the event of any subsequent widowhood or divorce. That change is estimated to benefit about 16,500 former war widows at an estimated cost of some £45 million a year.

The hon. Member for Moray (Mrs. Ewing) gave certain figures, but according to the latest estimate, some 8,000 former war widows have now lodged claims, and the number is rising steadily week by week. The estimate of 16,500 still stands, so the estimate of £45 million of additional expenditure per year also still stands.

The new clauses seek further changes, not this time to the DSS war widow's pension but to the separate Ministry of Defence armed forces pension scheme --a public service pension scheme. They seek improved pensions or pension rights for the widows of ex-service men. We have serious problems with the new clauses on grounds of principle. The introduction of half-rate widows' pensions was one of a number of major improvements made to public service pension schemes in the 1970s. Each of those improvements was introduced from a fixed and current date, and none could have been afforded if they had been extended retrospectively to recognise all previous service.

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New clause 11 seeks to make an exception for one group of public service pensioners--the widows of ex-service personnel- -by backdating an improvement to the armed forces pension scheme that was made in 1973.

We should be clear that the majority of widows who would benefit under new clause 11 are not "war widows" in the sense used in our debate about the DSS war widows scheme, or in the sense covered by new clause 12. In over 80 per cent. of cases, widows receiving pensions from the armed forces occupational scheme will have been married to service men who have died after retirement from causes unrelated to service. Those who are war widows in the proper sense will be receiving a tax-free war widow's pension from the DSS in addition to their pension from the armed forces pension scheme. We have estimated that there are some 53,000 pre-1973 service widows whose pensions would have to be reviewed if the new clause were implemented. It is not possible, in advance of the review, to arrive at a clear estimate of the cost of full retrospection, but it is estimated that the cost to the armed forces pension scheme would be some £27 million per year. The final cost would be substantially higher if the same principle were extended to other public service pension groups to which the same rules apply.

The widows of members of the forces who retired or died in service before 31 March 1973 and who are in receipt of an armed forces pension are therefore not a uniquely disadvantaged group. We recognise the debt that we owe to those who served their country in those difficult times, but we could never have afforded to introduce the improvements that we have made to public service schemes since then if we had extended them retrospectively to recognise all past service.

It is for that reason that we must maintain the principle that improvements in public service occupational pension schemes are made on the basis that they benefit only those giving service on or after the qualifying date. I say to my hon. Friends that, if we are remotely serious about controlling public expenditure in coming years, we cannot enter into the sort of open- ended commitment that we are asked to enter into with proposals such as new clause 11.

Mr. Simon Hughes: I want to pick up one point that reflects a point made by the hon. Member for Dorset, West (Sir J. Spicer). The group that the Minister described is not uniquely disadvantaged, but is a unique group for the reasons given: it is part of the family that gave military service to the country. Does the Minister accept that the issue should be considered, not on the basis that everyone who is in the same boat should have a change, but on the basis that that group should be considered on its own?

11 pm

Mr. Hague: The hon. Gentleman might find that a difficult argument to sustain with members of other public service occupational pension schemes. As I said, certain arguments have been advanced about war widows and attributable pensions. We are talking about a public service occupational pension scheme, the majority of the beneficiaries of which are not war widows in the sense that death was a result of service in the armed forces. Of course one can argue that military service is different from other things, but one can also argue that the fire service,

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the police service and parts of the civil service are different from other things, so I am not sure that I can accept the hon. Gentleman's point.

Sir Jim Spicer: My hon. Friend has just made the point that one could argue that military service is different from other services such as the fire service. Does not that emphasise my point that the very least that one could do is to reconsider the amount that is paid in a gratuity when a debt occurs and to upgrade it substantially?

Mr. Hague: I shall come to my hon. Friend's point in due course. He raised it earlier and I shall of course refer to it in my remarks.

Mr. Alfred Morris: In the brief from which the Minister is reading, there is no mention at all of the point I made--that people who married after their service terminated had contributed year by year to an entitlement to widow's pension if they died and were survived by their wives. That is a very important point and supports the views of the Royal British Legion, the Officers Pensions Society and the War Widows Association in support of the amendment. In terms simply of equity, something that was paid for, in their view, ought to be delivered; but there is no mention of that in the reply that the Minister has been reading, which was prepared for him before the debate.

Mr. Hague: I am just coming to the right hon. Gentleman's new clause. New clause 14 seeks to make an exception for one group of public service pensioners, the widows of ex-service personnel, by backdating an improvement to the armed forces pension scheme that was introduced with effect from 6 April 1978. Pensions for the widows of those who married after their husbands had left the scheme occupation was one of a number of major improvements to public service pension schemes in the 1970s, but, again, each of those improvements was introduced from a fixed and current date. None of them would have been afforded if they had been extended, retrospectively, to recognise all previous service. They were not made retrospective in the 1970s by the Government of which the right hon. Gentleman was a member. That was an important factor for that Government then, and it is an important factor for this Government now and for all Governments in the future.

Before the Social Security Pensions Act 1975, it was a normal and well- established principle of occupational schemes, including those in the public service, that to qualify for a pension, the widow of a pensioner had to be married to him at the time when he was engaged in the occupation covered by the scheme. In that aspect of its provision, the armed forces pension scheme, a public service scheme, was similar to others--for example, the civil service, education, health, police, fire and local government schemes.

The new clause seeks to entitle any service widow of a post-retirement marriage to a widow's pension regardless of the introductory date applicable to other public service schemes. The Government of the day, when introducing that improvement, were well aware that, as usual, there would be people who fell just the wrong side of the implementation date and would therefore not benefit from

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it. The improvement was given a phased introduction in so far as only service in the relevant occupation from April 1978 could count. We have no record of the number of post-retirement marriages contracted before 1978, so the full extent of the cost of giving full retrospective recognition to all past cases is difficult to determine, but we estimate that the total cost of the new clause might well be in the region of £60 million for the armed forces pension scheme. That figure would increase substantially if the same principle were extended to other public service pension groups to which the same rules apply.

Mr. Dewar: Purely for clarification, the Minister said in Committee, at column 594 on 13 June 1995, that that £60 million was an estimated cost for the Ministry of Defence alone and did not take in anything else. It has been suggested to me that that £60 million is a cumulative cost over a run of years, and I wish to establish whether that is so.

Mr. Hague: Yes; the hon. Gentleman is quite right. That is a total cost over the years of £60 million. The figure that I gave earlier for the previous new clause was a per year cost of £27 million, and the figure for the change in the DSS scheme is a per year cost of £45 million, but this one, as the hon. Gentleman rightly identifies, with his usual perspicacity, is a total cost.

It is a fundamental principle that improvements to occupational pension schemes can benefit only those serving on or after a qualifying date. The rules in force at the time when an employee leaves the scheme occupation determine pension entitlement. It would be impossible on cost grounds alone to introduce major improvements to occupational schemes without imposing a fixed and current date for the award of additional benefits. The knock-on effects for other public service pension schemes if an amendment were to be introduced would be substantial.

Mr. Simon Hughes: Will the Minister give way?

Mr. Hague: I shall give way once more to the hon. Gentleman before discussing the other new clause.

Mr. Hughes: First, it is important that we obtain the figures. Does the Minister have before him--and if not, will he undertake to give it on another early occasion--the cost if one were seeking to provide only for those who were at retirement pre-1978, not those who have reduced entitlement because they fall in after 1978? Secondly, surely it would be possible, even if one did not backdate to 1978, to introduce the scheme from now, at considerably reduced cost.

Mr. Hague: I do not have the more detailed numbers and I am not sure that it is easily possible to calculate what the hon. Gentleman asked for, but I shall consider that and write to him with those details.

There may be alternative proposals that would cost differing amounts, but they are not the proposals that are before the House, and of course those that cost less would be of much less benefit to the people whom hon. Members have spoken about.

I shall now discuss new clause 12. The rule that a widow's pension ceases on remarriage is common to all public service occupational pension schemes. That is on the basis that widows' pensions are intended to give financial support for as long as the state of widowhood

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continues. The effect of new clause 12 would be to apply different rules to a minority of service widows, and to apply a rule change retrospectively.

It is claimed that it would not cost very much to make an exception for that group. Although the cost to the armed forces scheme would be relatively small--although we believe that it would be a net cost of about £1 million per year--there are other groups to consider. I am aware that provision of a widow's pension for life is a feature of most private sector schemes, but against that background it would be difficult to argue, if those new clauses were accepted, that other service widows and the widows of other public service scheme members should not also have the right to retain on remarriage the pension to which, they will claim, their husband contributed. As in other public service occupational pension schemes--

Mrs. Ewing: How many are we talking about?

Mr. Hague: I wish to make another point before dealing with that. The tragic circumstances of the Chinook accident last year, in which police officers and civil servants died alongside service personnel, show how difficult it would be in practice to make a clear-cut distinction between members of the armed forces and other public servants in this respect. As in other public service occupational pension schemes, a forces family pension or attributable forces family pension ceases on remarriage. There is, however, discretion--this relates to the point raised by my right hon. Friend the Member for Fareham (Sir P. Lloyd)--to restore the original pension on the subsequent marriage coming to an end. More than 80 per cent. of such applications are successful.

I am conscious, however, that the uncertainty as to the outcome of any restoration application, should the need arise, can be a source of great concern to a service widow contemplating remarriage. The current arrangements are discretionary, but the Government are prepared to undertake to make amendments to the rules of the armed forces scheme to provide for the automatic restoration of an attributable forces family pension, if the subsequent marriage should come to an end, on a similar basis to the arrangements now agreed for DSS war widows. Those amendments can be made without the need for primary legislation.

I can tell my hon. Friend the Member for Dorset, West that the Government will be considering the report of Sir Michael Bett's independent review of the armed forces manpower career and remuneration structures. The report has recommended that all service widows should retain their pension on remarriage. It has also made recommendations about lump sum benefits payable on death in service--the issue to which my hon. Friend referred-- and the need for a study of the rules for assessing whether incapacity is attributable. The Government will be giving all those recommendations very careful consideration.

The principle of paying widows' pensions for life is an issue that affects all public service schemes.

Mr. Bayley rose --

Mr. Hague: We believe that it would be wrong to make changes to the rules at this time for one very small group in isolation. I therefore cannot recommend to the House that the new clauses be accepted.

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Mr. Dewar: I shall be brief. This is clearly an extremely important and sensitive aspect of policy. The arguments have been expressed tonight with a great deal of feeling by many right hon. and hon. Members. My right hon. Friend the Member for Manchester, Wythenshawe (Mr. Morris), for example, has an especially long and distinguished record in this sphere. He is a persistent man, and I have no doubt that he will continue to be persistent and put his case forcibly to a Labour Government after the next election. [Interruption.] Many others--including the hon. Member for Dorset, West (Sir J. Spicer) who, with his "Ho, ho, ho", has just drawn attention to himself--have also presented strong arguments. I must in all honesty make it clear that I shall not be supporting the new clauses, and I want to explain why. A number of important questions of principle arise, which we can and no doubt should discuss in the future. I understand the strength of feeling, but there are difficulties with, for example, the principle of a widow's pension being paid for life, irrespective of status.

Indeed, when that matter was debated in another place, my Front-Bench colleagues there did not support that particular amendment--

Mr. Simon Hughes: If they had, it would have got through.

Mr. Dewar: I am not hiding. Politics is not always about doing the popular thing; it is occasionally about considering the arguments and trying to do the right thing. That is a lesson that I accept. I shall try to say this as calmly as I can. There are problems with the principle of having a pension for life, irrespective of status. It clearly has implications for other schemes and other parts of the public sector. It was on that basis that, in another place, we carefully backed the amendment that got through--it is worth recording that it did so against the Government's advice--which allowed the reinstatement of a pension for someone who had seen a second marriage end for some reason.

We have to be selective, although I understand the pressures. I understand that there are post-1973 widows who feel that the possible loss of a pension if they remarry is an inhibition and a barrier to marriage. I am not sure how strong that feeling is in all cases, but I recognise that it does exist. The principle has to be looked at rationally and sensibly in the wider context, and I am not satisfied that the Government or the House have done that so far.

Similarly with the argument of the hon. Member for Moray (Mrs. Ewing): I see that it is very attractive to say that there is a group of pre-1973 widows who did not buy in on a half-pay basis. That they did not and were not given an opportunity to do so, I accept. But there is the difficulty which should not be ducked. There were also people who served beyond 1973 who bought half-pay basis for their previous service. Frankly, we must consider the imposition and equity of that as well, because they have paid and obtained.

If we are to extend retrospectively without additional contribution--to raise from a third to a half--those people might well feel that they are due, for example, reimbursement. That is the kind of rather prosaic detail that we have to weigh in the balance before we go down that particular road.

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I also find--of course--new clause 14 attractive. We are not talking about war widows in an emotive sense, but about service pensions, which is an important distinction. The Minister might think that I asked rather an unhelpful question about the £60 million cost. My understanding is that it is--and he confirmed--cumulative to 2035. In a sense, that undermines the financial argument against agreeing to the new clause, although it does, of course, have to be weighed in the balance.

It is not right simply to dismiss totally the retrospective argument, or the fact that it is difficult to isolate and ring-fence service pensions as a general category in the way that has been suggested as against other public service pensions, often in areas of activity where there is danger and stress and where, too, there are casualties. One has to be a little careful about approaching the matter from a simple isolation argument, without considering it in a broader context.

11.15 pm

Mr. Simon Hughes: I hear the hon. Gentleman's argument, and I understand it, but I do not agree with it. Can he justify treating ourselves and our dependent successors differently and better than the people of whom he is talking?

Mr. Dewar: I can, although, again, it is not necessarily a popular argument. The parliamentary pension fund, which I think was introduced in 1965, is an occupational pension scheme giving rights ab initio. Therefore, the funding and the contributions were based on that principle. In other words, the fact that the pensions had to be paid was taken into the calculation, and the contribution was set on that basis. That is very different from changing the rules retrospectively when no accommodation has been made for such benefits. There is therefore a distinction to be made, although I understand why people throw that point at us, and why they feel so strongly about it.

Although I have taken a decision which I have not enjoyed because of my situation and that of my hon. Friends on the Front Bench, I recognise the temptation to say yes, I recognise the strength of feeling over the matter and I was glad to hear--one of the more significant comments made--the Minister refer to the Bett review and its recommendations. Those recommendations are on the table, and it would be of some consolation to the House and the hon. Member for Dorset, West, if it was a clear understanding that they would be under active consideration in the wider context about which I have been talking.

I do not think that we should proceed on a piecemeal basis, nibbling away, providing a little goodie here and a little goodie there, without putting them in some sort of rational context and ensuring that we have a defensible position against other claims which may be forthcoming and which we may want to distinguish or feel that we have to distinguish.

It is not--I am afraid--an easy decision, and I understand why many hon. Members will disagree, going

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into the Lobby. But after--genuinely--a good deal of agonising in the past day or two, my recommendation to my hon. Friends, on the Front Bench at least, is that we should not support the amendments.

Mr. Bayley: I am sorry that the Minister did not give way when he was announcing his intention to extend the service widow's pension concession by restoring a pension to those who remarry, lose their pension because they have done so and subsequently are widowed again, because he will recall that, in Committee, I pressed him about the Government's concession in relation to the Department of Social Security war widow's pension.

On behalf of some constituents who had raised the matter with me, I asked whether the Government would ensure that there was an automatic and simple procedure, with the minimum of difficulty, for those entitled to restart their war widows' pensions. I said that they should be able simply to notify the Department of Social Security and then have their pensions restarted.

Now that the Minister has made the welcome concession that the same principle of restarting the widow's pension will apply not only to the social security war widow's pension but to the service widow's pension, will he consider having a single application process, so that a service widow who received both a service widow's pension and a war widow's pension, subsequently remarried and lost her right to both those pensions, and then was widowed again, could make one simple application and automatically have both pensions restarted? People in that position have told me of their concern that it could be a complicated process unless the Government take steps to make it as simple as possible. I hope that the Minister will respond briefly to that point.

Mrs. Ewing: Like other hon. Members, I have listened carefully to the arguments propounded from both sides of the House. I am sure that everyone will agree that members of all the political parties showed a great deal of feeling and passion.

I was interested to note that the Minister called in his defence the fact that Government amendment No. 84 met some of the arguments. It is worth reminding the House that the Government fought that amendment tooth and nail in another place. They have granted only a very grudging concession, but it is of great credit to those who worked so hard in the other place that we have even reached this stage.

I had hoped that, having given that grudging concession, the Government would take a more realistic approach to some of the points made in the debate. The Minister seemed to have great difficulty in defining a war widow. I am sure that everyone would agree that a war widow is a war widow is a war widow. It is a simple definition. I referred earlier to the case of Mrs. Margaret Wormack. For the sake of those who have not received briefings or who follow our debates through the media, I shall read into the record exactly the sort of case that we believe merits a very small concession for a very small number of people.

Private Wormack joined the Army in 1933. He served in the infantry in Burma throughout the war, and at one stage he was captured by the Japanese. While escaping, he received severe bayonet wounds to the face, stomach

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and legs, and was left for dead. He and two companions struggled into the jungle, where they managed to stay together until one committed suicide.

When they were eventually picked up by a British patrol, Sergeant Wormack, as he had become, weighed six stone. He was temporarily blind and his face had been disfigured by maggots feeding on his bayonet wounds. He seldom spoke of the war. Mrs. Wormack learned about his experiences only from having to listen to his repeated nightmares. He was commissioned in 1944, and, although still suffering from recurring malaria, dysentery, a perforated stomach and facial wounds necessitating extensive skin grafts, he served until 1956, retiring as a captain.

Mr. and Mrs. Wormack were married for 49 years. Despite her husband's peerless service, Mrs. Wormack receives a one-third rate widow's pension, of just £140 a month after tax, or £1,860 a year. Any of us who know of people in our families or, through our associates, of people who went through the horrors of what happened in Japanese prisoner-of-war camps, will know exactly how difficult it has been for them to express their feelings, because they do not want to horrify members of their families with the reality of their stories. Yet this woman, who had to cope with a husband who had suffered that indignity during the war, is given £140 a month by the state.

We are asking for help for a small number of people. The Minister said that the figures have gone up from 6,500 to 8,000, but that is still less than 50 per cent. of those who are entitled to receive a half-rate pension, rather than the third-rate pension they receive at present.

I have said that these people are dying at a rate of 1,300 per annum, so it is hardly a substantial sum that is being asked for from the Treasury to support these people, who certainly deserve our support tonight. It is all very well to talk about the technicalities of a 1965 pension fund for Members of Parliament. Is it because we did not have such technicalities drawn up in 1939 that our war widows and our victory widows are now to be denied their basic fundamental rights? It seems that we are rejecting compassion and social justice in favour of technicalities, and, in the circumstances, I have no alternative but to press the matter to a vote.

Dr. Marek: I am sorry to intervene, but my hon. Friend the Member for York (Mr. Bayley) made a useful suggestion, and it would be nice if the Minister were to reply. The Minister, who is an honourable man, has a duty to reply, and I hope that he will be able to accept my hon. Friend's suggestion. I support the hon. Member for Moray (Mrs. Ewing), and I shall be joining her in the Lobby if the matter is pressed to a vote.

Mr. Hague: The hon. Member for Wrexham (Dr. Marek) may not have been able to see my sign of communication with the hon. Member for York, in which I indicated--I think to the hon. Gentleman's satisfaction--that I would write to him about the specific matter he raised after my main response to the debate. It is a difficult matter, because the hon. Gentleman was talking about both the DSS scheme and the Ministry of Defence scheme. I shall look at the points raised and will write to the hon. Member for York. I hope that that makes the hon. Member for Wrexham very happy.

Question put, That the clause be read a Second time:--

The House divided: Ayes 41, Noes 199.

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Division No. 195] [11.26 pm

AYES

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Ashdown, Rt Hon Paddy

Barnes, Harry

Bayley, Hugh

Beggs, Roy

Bowden, Sir Andrew

Bruce, Malcolm (Gordon)

Carlile, Alexander (Montgomery)

Chidgey, David

Cohen, Harry

Corbyn, Jeremy

Cunningham, Roseanna

Davis, Terry (B'ham, H'dge H'l)

Ewing, Mrs Margaret

Forsythe, Clifford (S Antrim)

Foster, Don (Bath)

Harvey, Nick

Hughes, Simon (Southwark)

Johnston, Sir Russell

Jones, Nigel (Cheltenham)

Kirkwood, Archy

Llwyd, Elfyn

Lynne, Ms Liz

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McAvoy, Thomas

Mackinlay, Andrew

Marek, Dr John

Marshall, Jim (Leicester, S)

Michie, Mrs Ray (Argyll & Bute)

Morris, Rt Hon Alfred (Wy'nshawe)

O'Brien, Mike (N W'kshire)

Rendel, David

Ross, William (E Londonderry)

Salmond, Alex

Simpson, Alan

Skinner, Dennis

Smyth, The Reverend Martin

Steel, Rt Hon Sir David

Taylor, Matthew (Truro)

Tipping, Paddy

Tyler, Paul

Wallace, James

Winnick, David

Tellers for the Ayes: Mr. Andrew Welsh and Mr. Ieuan Wyn Jones.

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