Memorandum from the Officers' Pensions
Society (14 September 2000)
A. Defence Committee Press Notice No 17,
dated 29 June 2000.
B. The Armed Forces of the FutureA
Personnel Strategy, dated February 1997.
C. Armed Forces Overarching Personnel Strategy,
dated February 2000.
1. The Defence Committee's Inquiry intends
to cover, inter alia, the effectiveness and appropriateness
of the Armed Forces remuneration package of which pensions is
a significant element. This Society has considerable experience
of the practical implications of the Armed Forces Pension Scheme
and its impact on both serving and retired Service personnel of
all ranks and their dependants, and a history of constructive
input to MoD pensions policy development. We would like to submit
evidence to the Inquiry which we hope the Committee will find
2. At the invitation of the Minister of
State for the Armed Forces this Society forwarded a comprehensive
submission on 12 October 1998 to the MoD Review of the Armed Forces
Pension Scheme (AFPS). This Review has yet to come to its provisional
conclusions or to consult widely as promised, but we remain willing
and eager to contribute constructively.
3. In the intervening two years this Society
has watched developments with care. We noted with pleasure the
Government's announcement in July this year that from this Autumn
attributable widows' pensions would be payable for life and no
longer withdrawn on remarriage, and that similar treatment for
all widows would be a main recommendation of the long awaited
MoD Pension Review: we have campaigned long and hard for this.
On the other hand, having exhausted all domestic processes, we
have lodged a case on behalf of our members at the European Court
of Human Rights (ECHR) on two other serious inequities concerning
widows' pensions (pre 1973 one third rate widows' pensions and
post retirement marriages) and we await a ruling on admissibility.
4. This Society's submission to the MoD
Pension Review identified all these issues and others as serious
inequities which must be corrected, and many other measures designed
to ensure that weaknesses are not perpetuated and that the new
AFPS emulates as far as possible best practice in the public and
private sector. That submission remains entirely relevant and
I enclose a copy of the main discussion document with a supporting
annex and 17 explanatory appendices for consideration by the Committee.
5. In doing so, we keep firmly in mind the
statements contained in two References cited at the head of this
letter. In the previous Administration's "Personnel Strategy"Ref
BChapter 5 looked at the need for a pension scheme review,
noting that it would need to take into account:
". . . the relative inflexibility of the
current arrangements, and the fact that they are out of line with
other pension schemes in the public and private sectors"
The current Administration's "Personnel
Strategy"Ref Cnotes in its Personnel Strategy
Guideline No 26 that a principle of its Pensions Policy should
". . .to provide a pension scheme for the
Armed Forces that reflects modern standards and is consistent
with the legitimate expectations of Service personnel."
6. In our view the current AFPS falls well
short of modern standards and contains several gross inequities
which must be corrected. Anything less will perpetuate injustices
and continue to treat very shabbily many of our pensioners and
their widows who have served their country loyally in peace and
war; and will also not serve the Armed Forces well because a flawed
pension scheme will act as a disincentive to recruiting and retention.
It must also be of concern that as the MoD Review will no doubt
have to work from an assumption of cost neutrality and that as
pensioners are living longer, the chances of at least maintaining
the current inadequate value of the AFPS let alone bringing it
up to modern standards must be seriously in doubt.
7. We would also like to draw the Committee's
attention to the unique nature of the Armed Forces' commitment
to their country, which is of an entirely different and more demanding
kind than that of any other group of public servants. Men and
women in the Armed Forces have an unlimited liability; are required
to use and have used against them violent force as an essential
part of their role; surrender many of their freedoms under a further
code of discipline; have a reserve liability; and rely entirely
on the Government as their employer for fair treatment with no
independent representation. Their dependants are also affected
by many of these factors with massive disruption to housing, schooling
and careers which place their long term future in jeopardy. In
our view this puts servicemen and women and their dependants in
a unique category and deserving of unique treatment in regard
to their pension provision. The argument that Armed Forces' pensions
must be in line with the generality of public servants really
must not be allowed to prevail any longer.
8. Our Chairman and Council ask the Committee
to consider this evidence with care, and are of course ready to
attend any session of the Inquiry or to submit further evidence