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Mr. Breed: Does the hon. Gentleman share my worry that given the movement of the burden of proof from the Ministry of Defence to the claimant, and the extraordinary rise of the so-called expert witness—and the cost of such witnesses—people will find it extremely difficult to get to even first base in a disputed claim unless they have substantial funds, access to legal aid or other support?

John Robertson: The hon. Gentleman makes a good point. We must consider cost, and I suspect that bodies such as the Royal British Legion may come into their own in such circumstances. I agree with the sentiment

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behind his question. Can we reasonably expect ex-servicemen and women to provide extensive proof that an injury that occurred several years previously was due to their service? I dislocated my shoulder while playing cricket years ago. If I were a solider who had suffered that injury, I would have to prove that I did it as a soldier, which is unreasonable.

It is unfortunate that several interested parties were given the impression that the change was a result of financial imperatives. I do not believe that, but the new scheme should not automatically follow modern practice, such as the way in which the civil courts reach evidence-based decisions using a balance of probability as standard proof. Our armed forces give exceptional service in exceptional circumstances and they deserve exceptional support.

I shall address several hon. Members' comments because some were good and others have given rise to questions. My right hon. Friend the Secretary of State talked about transfers to the new pension scheme. The scheme starts in 2005 and people would be able to transfer in by 2007. What will happen to people who have X number of years in the existing system and want to transfer into the new one? Will they be able to buy years in the new scheme, or will they end up with two different pensions? Having read the explanatory notes, I am not sure of the position.

I am very sorry that the hon. Member for Mid-Sussex (Mr. Soames) is not here because I really enjoyed his speech. I do not have a question about it and I do not want to quote him; I just want to say that it was highly entertaining. When he overheard something that I said and gave way to me, I thought that I did well thinking on my feet and asking a question.

The hon. Member for Canterbury (Mr. Brazier), who will, I know, speak later in the debate, mentioned something that came up when I was talking to soldiers in Basra and other areas—house prices. There are those who have been in service for many years and who, because of short-sightedness or whatever one wants to call it, did not invest in housing at an early age. Young people are inclined to forget about such things. As age has crept up on them they have realised that they have to retire soon. We have to make provision to help those people. I am not saying that they should be given extra money, but house prices are a problem for them. It was pointed out to me several times that they are at a financial disadvantage in the housing market. It is a bit like asking a first time buyer nowadays how they can afford to buy a house.

Mr. Brazier: I thank the hon. Gentleman for raising this issue. In the Army in particular, which is by far the largest of our three services, it is almost impossible to own a house if one is being moved every year or two, except towards the end of one's service. The one factor that partially compensates for that huge disadvantage, which is met in America by a large interest-free loan on leaving the forces, is that British servicemen can trade in part of their immediate pension for an additional lump

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sum, which goes some way towards the huge cost of a house. In the early departure scheme, that sum will be a great deal smaller.

John Robertson: I thank the hon. Gentleman for that point and for his earlier intervention, which reminded me of this point.

Mr. Caplin: I hope that I can help the House on this point. I do not always want to advertise my speeches, but I made a speech this morning about homelessness and the armed services to the Sir Oswald Stoll Foundation and the ex-services action group. I announced that on 1 April we are to introduce a new system for a continuous stream of interviews through the chain of command about housing requirements, particularly in the Army. The hon. Member for Canterbury (Mr. Brazier) is right: there is an issue about us moving Army personnel too often and not allowing them to settle down, particularly when their partners have a job that helps to support them and their families.

John Robertson: I thank both my hon. Friend and the hon. Gentlemen for their input. That is excellent, but we still have to address the fact that there are soldiers who are about to leave the Army, and who undoubtedly need help. Anybody who has put their life on the line for 20 or 25 years deserves support from us.

The hon. Member for South-East Cornwall (Mr. Breed) said correctly that nothing had been done for 30 years. I return to the point that I made in my intervention on the hon. Member for Mid-Sussex, when I quickly thought on my feet, which is that the Government should have done something by now—and I am referring to all Governments. It is a sad reflection on the Conservatives that they did nothing during 18 years in government. I have heard Opposition Members' criticism of Ministers, but at least they are trying to do something. Although I support much of what Opposition Members said, in this they must take the responsibility, and their party must explain why it did nothing during that 18 years. It is a party that says that it supports our armed forces more than anybody else. I am sorry, but it does not come out that way.

My hon. Friend the Member for Crawley (Laura Moffatt) made an excellent point about those aged 40 or over who do not have a disability. I spoke to people in the armed forces who are approaching or slightly above that age, and I have to say that they did not look to me as though they would not get a job when they left. They are extremely resourceful—indeed, more so than some of the people from the poorer areas of Glasgow who come to my surgeries. I respect them very much, and if we suggest that they have a disability because they are over 40 we do them a disservice. However, I accept that we must help people when they leave the armed forces, especially older people, not only by preparing them for employment but in actively helping them to try to get a job. My hon. Friend the Member for Crawley made that point well.

What can I say about the speech of the hon. Member for Ruislip-Northwood (Mr. Wilkinson)? His attack on my right hon. Friend the Secretary of State was outrageous, particularly in a debate in which Members on both sides of the House have made friendly contributions, even those who advised the Government

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to do more and wanted them to introduce a better package for a soldiers. The contribution of the hon. Member for Ruislip-Northwood added little to the debate, and his attack on unmarried partners, whether of the same or the opposite sex, was a disgrace. I thought that hon. Members were above such behaviour, and it is my sincere but sorry belief that he made a grave error. I shall be interested to see how the Opposition spokesman responds to his contribution.

Many of the soldiers to whom I spoke in Basra suggested that there was one way in which they could be compensated. As the hon. Member for Canterbury said, they were taxed unfairly in comparison with American soldiers. If we are going to compensate our soldiers for putting their lives on the line, one small thing that we could do that would not cost the country a lot of money is to exempt them from tax while they are fighting for their country. It is not fair that they should have to pay tax in Iraq, particularly as soldiers in the larger army to the north were receiving tax exemptions. Such provisions may not sit happily in the Bill, but they are a form of compensation. I have raised this matter before, and I urge the MOD to consider tax exemptions—perhaps not for personnel based in Germany, but certainly for those in Northern Ireland or on active service in Afghanistan, Iraq and Sierra Leone. It is only fair that soldiers who put their lives on the line should receive an immediate financial benefit.

I have expressed some concerns about the Bill, but I do not want to dwell on the difficulties, because I know that my right hon. Friend the Secretary of State and my hon. Friend the Minister will take them into account. The Bill is worthy of vocal support. It will introduce a progressive package that modernises the way in which pensions and compensation for the services are handled. It should be seen in the context of a rising defence budget that will secure the role and reputation of our armed forces, and it will work alongside a range of Bills that promote equality, fairness and decent rewards for those who serve the public so well.

4.8 pm

Sir John Butterfill (Bournemouth, West) (Con): The Bill is a welcome measure, and includes a lot of good things. My main reservation concerns the fact that we are being asked to sign a blank cheque, and give the Government powers to do something that is not yet adequately defined, even though they have issued documents that give quite a lot of information about what they have in mind. The Secretary of State's explanation that making the change in that way makes it easier to update arrangements in future is not acceptable. It would have been possible to include schedules in the Bill, and specify that they could be amended in future by statutory instrument. That would have been a better way to proceed, as we would all know what we were being asked to sign up to. My only hope is that although we do not have that, as we are having the debate today, the Government may be minded to listen a little to what many of us on both sides of the House have said, and may make some improvements in the final shape of the Bill before it becomes law.

I welcome the improvements in the death-in-service benefit, although that does no more than bring the forces' compensation up to the level that is now general

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among the population as a whole. Given the hazards that service people face, perhaps we all should have done that—we should have done it when we were in government, and the present Government should have done it—a long time ago. The same applies to the benefits for widows and other dependants. Those are all welcome, but have been rather long in coming.

Much in the Bill is worth while, but I question the suggestion that anybody with a full career in the armed forces until the age of 55 will be able to earn a full two- thirds pension. The Forces Pension Society calculates that anybody doing a full career would earn only 62.5 per cent., rather than the full two thirds. That is supported by the brief provided for the Bill in the Library, and my own calculations show that it is likely to be the case. It all depends on the age at which service is commenced and the age at which it finishes. For most people it finishes at 55, although three-star generals carry on a little longer.

The difficulty is that because that calculation assumes a very early career start, it overlooks the fact that there are other important aspects for the armed forces to consider. One is that in today's world it is important for the armed forces to be able to recruit extremely well qualified people. That means that they will not recruit graduates until their early 20s at least. If they are to recruit people who have taken masters' degrees or doctorates, which are becoming more important for the armed forces, those people will be in their mid or late 20s.

The biggest difficulty for the armed forces today, I am advised, is recruiting medical staff—qualified doctors, who have an even longer period at university before they can join the armed forces, so it is virtually certain that unless they go on to become three-star generals or the equivalent, they will not reach a full career pension under the structures proposed in the Bill. The problem with doctors is so severe, I understand, that the Army, together with Exeter and Plymouth universities, is sponsoring a scheme whereby people who have degrees in other but perhaps slightly related disciplines can, with Army support, go on to qualify as doctors and come in even later, because they have already gone through one lot of academic training. For people whom we need to recruit into the armed forces, there is a real problem in getting a full pension under the terms of the Bill.

I know that the Government's proposal to extend the age at which the pension can be taken is part of their overall proposals for the whole of the public sector, to cater for the fact that people are living much longer and therefore the cost of providing pensions is even greater. It is clear from the Government's White Paper that it is likely that they will extend that principle to many other parts of the public sector. It is wholly inappropriate that the armed forces should be the first to suffer that and be the guinea pig in the process that the Government are proposing. Members of the armed forces, of all people, are least qualified to cope with that. There may be many people who can serve in the public sector until the age of 65 and receive a complete pension, but members of the armed forces cannot, by definition. Most will retire before they are 55 and will have to take another occupation.

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As many hon. Members on both sides of the House have said, starting another career, certainly in their mid-40s, may not be all that difficult for many service personnel, because in the armed forces they acquire skills that are admired by employers outside. However, for those who stay all the way through to 55 it may be much more difficult. However much we dislike it, the fact is that employers still discriminate against older workers. It is well known that people of 55 and over find it extremely difficult to enter new careers.

The Government are telling members of the armed forces, "If you go at 55, you will have to wait 10 years before you can receive your proper pension." Previously it was five years.

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