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5.20 pm
Mr. Geoffrey Robinson: The hon. Member for South-West Devon (Mr. Streeter) started his speech with some misplaced quotations on our Budget by the International Monetary Fund, and I should like to take a couple of minutes to put him right on them. The IMF mission statement said:
- "The new Government has made an excellent start. It has set a high standard for its economic policies, aiming to maintain stability and foster long-term growth while seeking fairness in developing human potential. It has taken decisive steps towards these goals by making the Bank of England independent, introducing a Budget that makes rapid strides towards sound public finances, and initiating welfare-to-work and other programmes to enhance employability."
The hon. Member also mentioned fraud. It would have been illegal to do what was suggested, and we need no lectures--still less, help--from the Opposition on dealing with Europe. Time and again--most clearly in the BSE
crisis--we have seen how all the threats, bluster and vetoes in the world culminated only in a humiliating climbdown by the then Conservative Government. Therefore, we require no lectures on those matters from them.
At Amsterdam, as the hon. Member knows, the Government accepted qualified majority voting on fraud matters, which the previous Government's Euro- scepticism and perpetual search for fights with our partners in Europe prevented them from doing, however much it might have been in the British interest to do so. We will have no truck with the previous Government's tactics, however much they are thrust upon us, because they led to disaster.
On payments--I realise that the hon. Member for South-West Devon is trying to make the story run--it is simply not the case that, in sterling, the UK gross contribution will rise by 32 per cent. Although that story was in the Sunday newspapers, no one has mentioned it since--until today, when he strode to the Dispatch Box and, with such great alarm, tried to revive it. If he had read the Treasury's explanatory memorandum, which made the matter clear, he would know that the figure was produced by comparing sums in ecu that were calculated at very different exchange rates. Moreover, if he would like to go into the details of how we can reconcile any differences, I should be happy to do so.
I shall, however, come straight to the point. As the hon. Member is interested in the underlying increase, in sterling, in gross contributions--which, because we do all our national accounts in sterling, is what should matter to us--I ask him to accept that, between calendar years 1997 and 1998, the figure will probably be about 2 per cent. I stress, however, that that figure is for gross contributions.
I should have thought that the hon. Member would be more interested in net contributions. As he knows, the figures must be projected based on certain assumptions. Next year, they could move up or down--and I stress both those words equally.
The hon. Member is interested in gross contributions, however, and the simple fact--as he will know--is that those underlying increases were introduced by the previous Government precisely to escape the types of fluctuation and misrepresentation that can occur. The percentage increase will be only 2 per cent. Therefore, the gross contribution, in sterling, will rise from £10 billion to £10.2 billion. I hope that I have satisfied his queries on those matters, and that the motion will be accepted by the House.
Question put and agreed to.
Resolved,
Order for Second Reading read.
The President of the Council and Leader of the House of Commons (Mrs. Ann Taylor):
I beg to move, That the Bill be now read a Second time.
The Bill's purpose is to provide an automatic link between Ministers' salaries and movements in senior civil service pay bands, and, in so doing, to implement the recommendation of the Senior Salaries Review Body. It is right that we should move in that direction, because it is wrong that, each year, hon. Members should have to debate and vote on ministerial salaries. We once had to do the same for the salaries of hon. Members, and it was a ludicrous exercise. Each year, we must still vote on Ministers' salaries, and it is wrong that we should have to do so. We should not have to vote on our own salaries every year. It is important also that we establish that others--in this case, the SSRB--should determine the applicable linkage and general level of salaries for Ministers.
It is true that the issue has been discussed on many occasions, including--albeit briefly--in the previous Parliament. My predecessor, Tony Newton, was more than a little sympathetic to the proposal that we should establish an automatic linkage in salaries rather than refer the matter to the House every year. He was in favour of introducing legislation similar to this Bill, but there was never sufficient parliamentary time to do so. I am glad that, today, we have found time to deal with a relatively minor but eminently sensible measure.
As I said, the Bill and its provisions are in line with the SSRB recommendations. Recommendation 14 of its 1996 report stated
The adjustment would change salaries by the same percentage as the average of movements in the mid-points of the nine senior civil service pay bands. In establishing the automatic uprating mechanism, we will ensure that those types of salaries are kept in line with general pay changes elsewhere in the public sector.
I have to stress that the main objective of the Bill is to remove the requirement for Members of Parliament to vote annually. The automatic annual adjustment is already in place for the salaries of Members of Parliament and that was a step in the right direction. It is important to put the same mechanism in place for Ministers and other salaried positions.
I shall say a word about the main provisions of the Bill in case we do not have prolonged clause stand part debates this evening. Clause 1 will repeal section 1(4) of the 1975 Act and insert two new sections--1A and 1B--after section 1 of the Act, to set out the formula to increase automatically the salaries provided for in the Act and to
give power to change salaries or change the formula by affirmative Order in Council. Section 1A sets out the formula. It will operate in the same way as the resolution of the House of Commons on 10 July last year, which uprates the pay of Members of Parliament by reference to the average increase in the mid-points of the nine senior civil service pay bands. It will operate first for ministerial and other salaries on 1 April 1998. Section 1B provides powers to make an order for changing the annual amount of a salary or for providing that the amount of a salary may be determined or changed by reference to another amount or a replacement formula.
Sir Patrick Cormack (South Staffordshire):
The packed and tumultuous Benches of aggressive Members of Parliament indicate that the Bill is the subject of considerable controversy. I give a warm general welcome to the Bill. The Opposition will not seek to divide the House, because we agree with the principle behind the Bill. I subscribe to everything that the Leader of the House said in her brief opening speech. I shall however make one or two brief comments.
I know that members of the current Administration have voluntarily forgone an increase in salary this year, although they have indicated--the right hon. Lady will, I am sure, correct me if I am wrong--that they will take it next year. I question the wisdom of that move. By doing such things in the past, Members of Parliament have heaped odium on themselves. If the servant is worthy of his hire, he is worthy of the salary that Parliament has agreed after receiving the report of an independent review body. I counsel against gesture politics that can redound on the heads of those who indulge in it.
The issue is put in perspective if one goes along to the Library and picks up one of the fact sheets that the staff prepare. It is appropriate at this point to pay tribute to the staff of the Library who serve us so well. I have a copy of the fact sheet on ministerial salaries, which was revised this very month. It puts the issue in perspective to read the quotation from Macaulay, given in the fact sheet. Talking about the 18th century, he said:
It was because of the recognition of incipient corruption that our predecessors in the last century decided that they had to regularise the position. The fact sheet contains
delightful extracts from the proceedings of the Select Committee on Official Salaries of 1850 which would repay study by all right hon. and hon. Members. Mr. Ellice asked Sir Charles Wood:
That this House takes note with approval of the Government's assessment as set out in the Financial Statement and Budget Report for the purposes of section 5 of the European Communities (Amendment) Act 1993.
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5.25 pm
"that a review mechanism"--
should--
"be applied automatically, hence forward to the salaries of MPs, Ministers and paid office holders".
Obviously, such a mechanism will affect anyone who is paid under the relevant legislation.
"From the nobleman who held the White Staff and the Great Seal, down to the humblest tidewaiter and gauger, what would now be called gross corruption was practised without disguise and without reproach. Titles, places, commissions, pardons, were daily sold in the market overtly by the greatest dignitaries of the realm; in the 17th Century a statesman who was at the head of affairs might easily, and without giving scandal, accumulate in no long time, an estate amply sufficient to support a dukedom."
If we consider what went on in the past and the sums that were received, we put the modest recompense that we pay Ministers today in sharp focus.
"If you were to reduce the salaries of public offices very much, would not the consequence be, that no persons who had not large private fortunes could venture to undertake them?"
Sir Charles Wood replied:
"That would be the consequence. If the salaries of these offices were brought so low as to exclude the possibility of men of small fortune taking them, I conceive it would do a most irreparable injury to the public service, and great injustice to such parties."
Perhaps the language would be slightly different today, but the sentiments still apply.
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