Previous SectionIndexHome Page

Mr. Caplin: I am interested to hear the hon. Gentleman talk about the responses of the veterans. My

22 Jan 2004 : Column 1537

role as the Minister for Veterans is a cross-Government role based in the Ministry of Defence. During the 1992 to 1997 Parliament, the hon. Gentleman's party vigorously opposed the creation of such a Minister.

Mr. Brazier: I was a Back Bencher in that Parliament, and the Minister will know that I rebelled on several defence-related issues. During that period, I wanted what the British Legion wanted—a single unified Veterans Agency under the then Department of Social Security, now the Department for Work and Pensions. The second-best arrangement was the old arrangement; the worst of all is having the whole lot under the thumb of the Ministry of Defence. The one conclusion that came out of all the Select Committee debates on Gulf war syndrome and a string of other issues was that, because of an obvious conflict of interest, we cannot have the people responsible for looking after veterans under the control of the current Ministry of Defence. The parallel with America, where the veterans' administration is completely independent of the Pentagon, could hardly be more striking.

Finally, we owe the people who go through their careers without experiencing the horrors that are associated with serious injury or the loss of their husband or, in some cases, the loss of their wife, a decent pension package. The Government will reduce that package. For those people whose lives have been wrecked by severe injuries, the least that we can do is maintain the traditional standard of proof that has served our armed forces well for 60 years. We should allow them to come back at whatever time to receive proper and fair assessment. Through this penny-pinching measure, the Government are attacking people who cannot speak up for themselves.

4.45 pm

Mike Gapes (Ilford, South) (Lab/Co-op): I apologise because I was not here at the beginning of the debate. I have been involved in matters concerning the Westminster Foundation for Democracy. I also have to leave to take an urgent telephone call at 5 pm. Unfortunately, I shall be absent for a short period, so I apologise to the House.

I was a member of the Select Committee on Defence from 1999 to 2001, and I am now again a member of the Committee, and I want to say something about what I have seen as a member of it. Although I welcome many of the Bill's provisions, I want to explain my reservations. I agree with the case that was eloquently put by my hon. Friend the Member for Dunfermline, West (Rachel Squire), a fellow Select Committee member.

I saw in Sierra Leone the conditions in which British service personnel lived. I saw the appalling conditions that our people in Kuwait had to experience, and I have seen in operations in Kosovo and elsewhere the professionalism and excellence of our servicemen and women. When we introduce such a change, it is important that we ensure that it does not have adverse effects on the morale and expectations of the men and women in our services. I hope that the Minister will be able to assure me that everything will be done over the

22 Jan 2004 : Column 1538

coming weeks and months to explain what is happening and to deal in Committee with issues that Members on both sides have raised in the debate.

The Bill is not perfect, and it is necessary to consider the points raised by members of the armed services, by the Forces Pension Society and in the Select Committee's report. Problems are clearly associated with any change to any pension system. If changes are made, there will be losers as well as winners. If one adopts a process that is based on cost neutrality, improvements for some people will inevitably be made at the expense of others. The Select Committee had to point out that fact of life.

As the Select Committee pointed out, the proposals involve some welcome improvements. It says:

There are also advantages for dependants, as is pointed out in paragraph 138 of the Select Committee report. It is important that those points are made because, from some of the comments made today, one would think that the Ministry of Defence's whole intention was to penalise, and take away from, people serving in our forces.

Like my colleagues, I dissociate myself from the outrageous remarks of the hon. Member for Ruislip-Northwood (Mr. Wilkinson), who is not in his place. In the 21st century—perhaps even in the 20th and 19th centuries—such remarks are not and were not in tune with the thinking of a large proportion of the population. It is time for right hon. and hon. Members in all parts of the House to recognise that homosexuals have served in the Royal Navy, Army and Royal Air Force throughout history. Some lost their lives doing so, while others led our armed forces into combat and on to great victories. That is true of the Napoleonic wars, the second world war and more recent conflicts. Their contribution should be recognised equally with that of all those who have been prepared to put their lives at risk for our country.

Mr. Breed: I entirely agree with the hon. Gentleman that when changes are made to a complex system—particularly after 30 years—there will be winners and losers. If the schemes are to be modernised, enhanced and improved, would he expect more winners than losers or more losers than winners?

Mike Gapes: I hope that there will be many more winners than losers and that the Treasury will permit the Ministry of Defence to be flexible when interpreting costs. When the Minister gave evidence to the Select Committee, he said that there might be some transitional payments, which could not be taken into account in the overall cost-neutral formula. If the authorities rigidly keep to cost neutrality, it will not be possible to introduce a scheme that is broadly acceptable to the armed services. That argument is more for the Treasury than the Ministry of Defence.

The Select Committee pointed out that there is a Treasury-driven assumption that being a member of the armed forces is the same as any other public service

22 Jan 2004 : Column 1539

occupation, but clearly that is not so because of the nature of personnel deployment; the requirement to serve abroad and away from one's family, perhaps for many months at a time; the risks involved; and the period of service. All those factors should be taken into account but I am not convinced that that has been done.

The Select Committee also pointed out that members of the armed forces often perform tasks that are more dangerous than, but otherwise similar—and occasionally identical—to those performed by the police and fire services. One thinks, for example, of Army personnel who drove Green Goddesses. However, only a small minority of those in the armed forces will receive their pension at 55. The majority will do so at 65. I hope that further consideration will be given to that and other aspects of the Bill in Committee.

On balance, the proposed legislation should be supported. The Bill contains some good things but as it continues its passage through the House, we ought to examine in detail some of the issues highlighted by the Defence Committee. I hope that Ministers will receive the support of their Treasury colleagues for any changes that they may wish to make.

Defence Committees under all Governments have produced critical reports over the years but have always endeavoured to do so on a consensual basis, in speaking up for the men and women who serve our country and the international community through implementing the expeditionary strategy to build a safer and more secure world. It is crucial that those men and women believe in their hearts that our actions are in their long-term interests. We need to explain the benefits that will come from any changes that we bring about.

4.54 pm

Hugh Robertson (Faversham and Mid-Kent) (Con): I begin by saying what a pleasure it is to follow the hon. Member for Ilford, South (Mike Gapes), who made an extremely well-informed and balanced speech. The House is grateful to him for that. I also enjoyed the speech made by the hon. Member for Dunfermline, West (Rachel Squire). I have been a Whip for nearly two years now and have listened to a great many speeches by hon. Members of all parties. I can honestly say that her speech was one of the best I have heard; the House is very much in her debt.

For the purpose of complete transparency, I should draw the House's attention to the raft of entries under my name in the Register of Members' Interests. I remain part of the Regular Army Reserve of Officers, which means that I shall be eligible for a pension at the age of 60. I have married since leaving the armed forces—a fact that will become relevant later. In addition, I have a small business consultancy with Schroder Investment Management, and I worked in the field of institutional pensions before entering Parliament.

Two important principles must always be borne in mind when matters relating to the armed forces are considered in this House. The first, and by some distance the more important, is the fact that the armed forces are different. They are also special, but I shall settle for different. Why are they different? There are a number of reasons. The armed forces have unlimited liability. The use of violent force, by them and against them, is a regular feature of armed forces life. Members of the

22 Jan 2004 : Column 1540

forces operate under a separate code of discipline, with a resulting loss of freedom. They have liability for reserve service, and that still applies to me: I left the Army in 1995, but will remain liable for reserve service until 2012. The families of armed forces personnel face upheaval and disruption, which also limit the careers of family members. Careers in the armed forces are generally short, and armed forces personnel are selectively excluded from much legislation. In that connection, mention has already been made this afternoon of the national minimum wage.

Why do members of the armed forces need to be different? There is one very simple reason—they are expected to fight, and sometimes to die, for their country. That makes armed forces personnel wholly unique among public sector workers.

The principle of the difference of the armed forces is important in this debate for three reasons. First, Parliament must protect and cherish that need to be different, because of the particular tasks that the armed forces must undertake. Secondly, the pension and, if anything goes wrong, the compensation provisions for the armed forces must reflect the extra commitment and responsibility that Parliament and the country expect from their members. Thirdly—and I offer the House this one warning—we, as parliamentarians, must never inflict on our armed forces social legislation or politically correct measures that could inhibit or dilute their ability to fight and to carry out the very special role that we require of them.

A second main principle that must be borne in mind has been mentioned already by other hon. Members—that the armed forces have no body to represent their interests as employees. There is no trade union or similar organisation for military personnel. As a result, they look to us, as parliamentarians, to protect their interests. If the hon. Member for Dunfermline, West is anything to go by, the members of the Select Committee on Defence do that admirably. In short, the armed forces are a special case, and Parliament must therefore take special care when scrutinising any legislation that affects them.

It is a matter of profound regret for me, and for other hon. Members, that the Bill is only enabling legislation. That means that the House, which has a particular duty of care in respect of our armed forces, cannot scrutinise the Bill in a way that will permit a clear understanding of each and every implication that it will have for members of the armed forces, and for their dependants.

The Bill has four main elements. It provides powers to make new occupational pensions, and to establish a new compensation scheme. In addition, it amends the appeals procedure, and institutes changes to the Royal Patriotic Fund Corporation. I shall examine those four main elements part by part.

The first is the power to make a new occupational pension scheme. Because the Bill is enabling legislation, it is difficult to give an authoritative opinion, but I can safely say that large parts of it are welcome. I particularly welcome the commitment in paragraph 17 of the explanatory notes to remain with a final salary or defined benefits scheme. I do not say that because I am against defined contribution schemes—indeed, the movement of the markets may, in time, make them more

22 Jan 2004 : Column 1541

profitable than defined benefits schemes, but the key word is "may". Because of the nature of their service, the armed forces need the certainty of final salary schemes.

I welcome the removal of the distinction between widows whose partners' deaths are attributed to service and those whose partners' deaths are not. An unfortunate by-product of the removal of that distinction is that, in addition to non-attributable widowers who are already a legacy issue, a new group will be created with an extra grievance—those whose other half dies between now and the start of a new scheme. I hope that the Government will address that point, but the general change is welcome.

I also welcome the equal treatment given to officers and other ranks. That principle is not universally applicable across everything to do with the armed forces, because officers and other ranks carry out different tasks with different levels of responsibility and exposure, but its application here is clearly welcome.

I particularly welcome the increase in death-in-service benefits from one and a half to four times pay, which has been welcomed this afternoon by hon. Members on both sides of the House. I was going to say that I could live with the replacement of the immediate pension with a less generous early departure payment, but having heard hon. Members' arguments this afternoon, I will examine the point more carefully. I am sure that more imaginative solutions, particularly involving money purchase schemes, could be the answer. Whatever happens, we must recognise that the armed forces need to encourage people to serve for longer than a short career—typically for between 10 and 25 years—but not to serve until they are 55.

It would be wrong to say that I welcome all the provisions in the Bill, and some points particularly concern me. First, there is the lack of independent governance. I said at the start of my contribution that the armed forces have no body to represent their interests as employees. Their pension provision needs some sort of body or group of people to represent them and act in their interests. In years to come, the Ministry of Defence may face a straightforward conflict between the need to control expenditure and the need to provide appropriate pension arrangements for members of the armed forces. Some measure of independent governance would remove much of the suspicion surrounding the issue.

Secondly, there is an element of unfairness in deferring the payment of pensions from 60 to 65 if the retirement age for members of the armed forces remains at 55. That is a big cost saving, which comes directly from the pensions of servicemen and women, particularly because the increase in longevity at the other end of the scale—if I can put it in that slightly crude way—is not yet five years.

The third concern is that even those who serve a full career will be denied the opportunity to earn a full career pension, which is two thirds of final salary under current Treasury guidelines. For example, someone who started their career at the age of 20 and served until they were 55 would probably accrue 35/70ths of their salary. On most independent calculations—my hon. Friend the Member for Bournemouth, West (Sir John Butterfill) confirmed

22 Jan 2004 : Column 1542

this—adding in the lump sum makes about 62.5 per cent. of the final salary, and of course that is the best-case scenario, which is enjoyed by very few. The MOD should examine increasing the retirement age or the accrual rate towards the end of service, or, more imaginatively, consider part-funded additional voluntary contributions. All those proposals would remove that problem.

Finally, hon. Members on both sides of the House have pointed out that the impression remains that the review has been conducted on the basis of cost, and not on the basis of what is best for our armed forces. That is greatly to be regretted. The sad fact is that there will be one sure-fire winner: the Treasury. The proposal is cost-neutral, payments are deferred from 60 to 65 and the overall fall in the number of service personnel means that there will be fewer pensions.

The second aspect of the Bill is compensation. As Members who heard the earlier part of the debate will know, I believe that the compensation culture that has taken hold in much of British life—including, sad to say, in the armed forces—is intensely damaging. The MOD should seek where it can to close down on the propensity of ex-servicemen and women to sue through the civil courts for large sums of money. That process brings the MOD into considerable disrepute, as it takes an enormous length of time. The case is always fought against the Ministry, which does not help at all. However, the MOD should compensate by increasing provision for those injured as a result of service life.

Next Section

IndexHome Page