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New Clause
Salaries and expenses
Lords amendment: No. 12, after clause 22, to insert the following new clause--Salaries and expenses--
Mr. Raynsford:
I beg to move, That this House agrees with the Lords in the said amendment.
Mr. Deputy Speaker:
With this, it will be convenient to take Lords amendments Nos. 13 to 16, 115, 532, 564, 658, 742 and 788.
Mr. Raynsford:
The amendments provide for the Authority to pay the mayor and Assembly members' salaries and expenses, and to abate those salaries where the members hold other paid public offices to which they have been elected or appointed. They provide for the Authority to establish a pension scheme for the mayor and the Assembly, and for the Authority to publish details each year of salaries and expenses that have been paid and of the financial provision made for pensions. They also provide for the exclusion of Assembly members from attendance allowance or other remuneration schemes of
Mr. Forth:
This is all very well, but it is yet another case of a substantial issue being slipped in quietly at this stage of the Bill's progress, presumably in the hope that not too many people will notice or pay attention to it.
The amendments raise the substantial issue of whether an elected authority should be free to set whatever pay levels for itself that it deems fit. Not even this House has that freedom: we defer to the Review Body on Senior Salaries, which gives the public a degree of confidence that Members of Parliament are not voting themselves excessive salaries--at least, we think it does. But no such reassurance is built into this mechanism. We are saying, in the purest possible form, that we will trust the elected members to pay themselves an appropriate salary, without any longstop or backstop.
Mr. Raynsford:
To avoid any confusion or uncertainty, I should like to make it clear to the right hon. Gentleman, as I hope I did in Committee, that the salaries will be based on the recommendations of the Senior Salaries Review Board.
Mr. Forth:
I am grateful to the Minister for that reassurance. I had not spotted any such provision in the Bill. The Minister's confirmation will give some comfort to the public, particularly as this is a completely new venture, and for that I am grateful. If nothing else, the debate has clarified one matter.
I should like a similar reassurance from the Minister who, I am interested to see, is playing a prominent role in our proceedings. He started by saying modestly that he was more of an adviser or bystander, but we have had the privilege and pleasure of his very active participation. We have not heard much from the other Minister, but we may hear more as time goes on. I await the moment.
I have another point on which I hope to elicit a similar reassurance from the Minister. Lords amendment No. 14 concerns pensions, which are, if anything, even more sensitive than salaries. Salaries are relatively open and transparent, but pensions are complex and it is often difficult for the public to understand exactly what is being paid and on what basis. There are questions about length of service and who makes contributions--the employee or the employer--and so on. There are huge variations in pension schemes for elected representatives around the world. Some are extraordinarily generous--in passing, I think that ours is particularly parsimonious and, given that the average length of Members' service is only 12 years, unfair.
" .--(1) The Authority shall pay to the Mayor and the Assembly members salaries at such levels--
(a) as the Authority from time to time determines; or
(b) before the first determination, as the Secretary of State directs.
(2) The Authority may pay to the Mayor and the Assembly members, in respect of expenses incurred in the exercise of their functions, allowances at such levels--
(a) as the Authority may from time to time determine; or
(b) before the first determination, as the Secretary of State may direct.
(3) A determination or direction under subsection (1) above may provide--
(a) for a higher level of salary to be payable to the Mayor than to any Assembly member;
(b) for higher levels of salaries to be payable to Assembly members holding the offices specified in subsection (4) below than to other Assembly members; and
(c) for different salaries to be payable to Assembly members holding different such offices.
(4) The offices mentioned in subsection (3)(b) above are--
(a) Deputy Mayor;
(b) Chair of the Assembly.
(5) A determination or direction under subsection (2) above may provide for different allowances for different cases.
(6) A determination under this section may provide for levels of salaries or allowances to change from time to time by reference to a specified formula.
(7) The Authority's functions of making determinations under this section shall be functions of the Authority which are exercisable by the Mayor and the Assembly acting jointly on behalf of the Authority.
(8) The standing orders of the Authority must include provision for the publication of every determination under this section.
(9) The Secretary of State shall publish any direction under this section as soon as is reasonably practicable after it is given."
6 pm
We need some reassurance from the Minister, similar to that which he gave on salaries, that in making provision for pensions at the start of this new body, there is no question of members being able to vote themselves over-generous pension arrangements that require excessive input from the hapless taxpayer. A balance must be struck, but we need some reassurance that there will
be a mechanism to reassure the House and the taxpayer at large that the pensions provisions will have a safety mechanism attached and not be excessively generous.
Mr. Wilshire:
The Minister may be able to confirm something for me and thus make most of what I want to say irrelevant. I was not on the Standing Committee, but he told my right hon. Friend the Member for Bromley and Chislehurst (Mr. Forth) that he had made it clear in Committee that guidelines would have to be followed. Will that be enacted, or is it only what the Government hope will happen? Will the Assembly be able to note the guidance of the top Review Body on Senior Salaries and then move on, or will it be bound by it?
Mr. Raynsford:
I can give the hon. Gentleman the reassurance that he seeks. In the ethical guidance that will be issued, we intend to indicate that the initial salaries will be set by the Secretary of State on the recommendations of the Review Body on Senior Salaries. Subsequently, the Authority itself should have regard to the recommendations of the review body in any upgrading of, or changes to, those salaries.
Mr. Wilshire:
Sadly, that has not rendered what I want to say useless. Ethical guidelines are wonderful things that we should all follow and recommendations are useful, but I was seeking reassurance that there was a statutory obligation that bound the Authority. Without that, my concerns still stand.
Whatever the ethical considerations, we are being requested to vote to allow the Authority to pay itself whatever it likes. It has only to listen and think before doing so. That is not the case in local government, so why should it be with the Authority? Why are the guidelines, whatever they may be, not being put in terms that require them to be followed? If that is not possible, why cannot we pass the setting of salaries to an independent third party, so we do not have people deciding what they want to put in their pockets and doing so at the public's expense? We should review what we are being asked to do. This is not party political, because my worry applies irrespective of which party the Assembly's members come from.
I am even more concerned about expenses. It is always easy to home in on someone's salary, but expenses often get published only as a general figure. Over the years, many people have wanted to spare their own blushes and avoid the bad publicity of a pay rise by turning their attention to setting their own expenses.
I do not see anywhere in the Bill proposals to limit the power of the Authority's members to set their own expenses. There is not even any reference to guidelines or codes. The Minister may say that there will be guidelines. That would help a bit, but it is not enough reassurance.
The Bill allows for indexation. I am all in favour of indexation as a way of dealing with inflation, but there ought to be some limit on the amount of indexation that can be applied, or some terms that will have to be followed. If I understand it correctly, at the moment the Authority can simply say that it will index salaries by 25 per cent. a year, without justification. That will have the power of law. So I hope that, even at this last moment, the Government will consider limiting automatic indexation of salaries and expenses to the rate of inflation.
If the Authority wishes to go above the rate of inflation, it should have to discuss it at a public meeting at which the press can hear what is said and report it.
The Bill also makes reference to the publication of information. All of us who have been through local government know only too well what happens when a minute advert is put on page 43 of the local rag. That amounts to publication, but it does not tell anyone anything--because no one sees it. In saying that matters must be published, this House, the Government or whoever should specify that information is to be published in such a way that it is clear for all to see, and in a place and form in which the public will understand it.
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