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Mr. Heath: Perhaps the Lord Chancellor can enlighten me.
Mr. Straw: I will not invite you to declare an interest from the Chair in this matter, Mr. Gale, although I could. The provision is perfectly innocent. There is one class of Member-we are all elected as Members of Parliament. However, as the hon. Gentleman will recognise, some time ago the House decided that it should make additional payments to Chairmen of Select Committees and Public Bill Committees and other office holders. It also determined that there should be different levels of payment for different levels of responsibility. We have sought to replicate that in the new clause, to ensure that in setting pay, IPSA takes account of decisions of the House about such Members.
Mr. Heath: I was quite sure that that was the Lord Chancellor's intention, but I do not know why that is not considered to be covered by the term "different offices or positions" and why the new clause has to mention "different classes of member", which is an expression that inevitably rankles and one that I would not entirely encourage the use of.
Mr. Straw: No part of the new clause states that there is a first class of Member, which is Labour and Conservative Members, a second class of Scottish and Welsh nationalists and anybody else, and then a third class, well below the salt, of Liberal Democrats. Attractive though that may be, it is no part of our intention.
Mr. Heath: It is very important that IPSA hears that. Of course, different parties in the House are treated differently in how financing is provided, so it is not unreasonable to draw attention to the enormity suggested by "different classes of member".
Sir Robert Smith: The provision is drawn quite widely, so there is a concern that IPSA might choose to define different classes of Member or decide that Members from different constituencies are due different pay levels depending on the nature of the work that they do for their constituents. The new clause would enable IPSA to make that decision if it wanted to.
Mr. Heath: It would indeed. This may be a particularly live issue for Members representing Scottish constituencies, as it is not beyond the bounds of reason for someone to suggest that, because there are other elected Members doing casework in those constituencies, there might be a discrepancy. This is an unwise signal to send, so I ask the Lord Chancellor to look at it.
Another issue implicit in new clause 73 is the start date of salary. I would like to raise an issue of concern, on which the House should take a view in the very near future. Owing to the number of right hon. and hon. Members who have declared that they are standing down at the next election, we shall have an unprecedented turnover of Members and many new ones will enter the House. That will require a significant degree of induction in order to bring them up to speed. I have always felt that our system is too precipitate-immediately following a general election, the pantechnicon arrives at No. 10 Downing street and everything changes; we start with a new Government and a new Parliament at the earliest opportunity.
A strong argument can be made for a period of reflection to allow preparations to be made, as is normal in almost every other legislature and almost every other governmental arrangement. A period of reflection is important as new roles and responsibilities are established and new posts are taken up. However, there is an implicit bar to that happening under proposed new section 4(6), which states:
"No payment of salary is to be made to a member before the member has made and subscribed the oath".
I am not arguing that Members should not subscribe the oath or undertake equivalent procedures in order to take their place in the House, or that Members should be paid if they are not prepared to be full Members of the House. I am simply saying that if the intention is for Parliament to assemble and for oaths to be sworn at the earliest opportunity in order to prevent any interruption to payment of the salaries of existing Members or new ones, it will work against the interests of good governance. I believe that the House should take a view on that at some stage.
Peter Bottomley: The hon. Gentleman puts a delicate point, but provision is made for pay to go back to the day or day after the election. If we sign on, say, two weeks after the election, that will be within the month and it is quite likely that we will get paid. If the election were held at the end of the month, there might be a slight temporary problem, but even the present banking system might be able to tide us over.
Mr. Heath: That may be true, but I hope the hon. Gentleman will accept that there is a problem here, particularly for new Members, who may not have received any salary of any kind during the period immediately before the election, because they left their jobs in order to fight it. They then may face the prospect of being without payment for a considerable period after the election. That puts pressure on the House authorities to convene the House at an earlier time than would otherwise be the case. I do not want to overplay this issue, but I feel that there is a case for proper and careful induction of new Members, so I do not want there to be an impediment simply because of how Members are paid.
Andrew Mackinlay (Thurrock) (Lab) rose-
Mr. Heath: Two Members want to intervene.
Andrew Mackinlay: I have a great deal of sympathy for the hon. Gentleman's view that we sometimes rush things in having the Queen's Speech about a week or eight days from the general election. What should happen is that Parliament convenes for swearing in and appointing the Speaker, but then there should be an interregnum between that time and the Queen's Speech, allowing Ministers to master their briefs and new Members to have a proper induction.
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Mr. Heath: I, in turn, have a great deal of sympathy for that suggestion, as I believe it is probably the best way of dealing with the problem. I hope that we can have discussions between the various interested parties to see if we can reach a view on that.
Andrew Miller: I was elected to the 1992 Parliament, as was my hon. Friend the Member for Thurrock (Andrew Mackinlay), and I recall that the Easter recess occurred immediately after the election; there was a gap. Practical problems have been identified, and the hon. Gentleman raises a fair point that needs looking at, especially given what IPSA is saying about setting up loan procedures and so forth. In my own case, I recall having to take out a whopping great loan from the bank-a fairly unacceptable position to be in, but there we are. The payment of salary needs looking at, but I am not sure exactly how, unless we understand what IPSA intends to do with its loan proposals.
Mr. Heath: I am grateful to the hon. Gentleman, who is absolutely right. I am simply saying that we should not assume that every Member is of independent means or has a sufficiently good credit rating to be able to borrow money at will. Some are likely to find themselves in considerable difficulties, and we should recognise that and make our arrangements accordingly.
Allow me to help the Lord Chancellor in his interpretation of the numbering relating to new clause 73, as I have now worked out how the proposed new subsections (2) and (3) relate to subsection (1)-and he has obviously done so as well. The new clause leaves those proposed subsections (2) and (3) outside the amendments to the Parliamentary Standards Act 2009, and freestanding, which may or may not be a good idea, but makes sense in terms of the architecture of that new clause.
On new clause 75, let me express the opinion that I am not sure that the introduction of civil law is necessarily helpful, as it will add a further complication. We have the criminal law to deal with actions that are serious misdemeanours on the part of Members, and I hope that it will be used appropriately. This new procedure allows the imposition of penalties for non-assistance, as it were, and then the application of a proper penalty, but introducing the concept of civil remedy as well makes life more difficult rather than easier. I am not convinced that that is the best way of dealing with what I accept is a difficult problem.
The relevant part of the related new schedule 7 -paragraph 5(4)-states:
"In England and Wales and Northern Ireland the amount is recoverable, if a county court so orders on the application of the Compliance Officer, as if it were payable under an order of that court."
I do not understand what that means. What it says is that if a county court makes an order, it is payable as if it were a county court order. Well, yes-it would be, because that is what it is. There must be some purpose in the wording that eludes me here, so I would be grateful for some assistance.
Peter Bottomley: It just means that in England and Wales and Northern Ireland, but not in Scotland, the compliance officer has to go to the county court and make an application, and that if that court agrees, it becomes payable.
Mr. Heath: Yes, if a county court makes an order, it is payable, so it does not need a subsequent provision saying
"as if it were payable under an order of that court"
It is an order of the court, so there must be some further meaning that I do not understand; it seems to me to be tautological and I do not like tautology in statute. I hope that we might avoid that, if at all possible.
My final comments-I appreciate that this is a large group of amendments and that I have already spoken to them for some time-relate to pensions. I am pleased that the Lord Chancellor has said that he will look again at the provision. I do not think that it was drafted entirely in accordance with what Kelly recommended: in my opinion, it gives IPSA a much wider role than he intended. Its proposed role in the appointment and, particularly, the "disappointment" of trustees is unhelpful, and contradicts the normal practice applying to major pension schemes outside the House. In its excessive zeal to prevent MPs from determining their pension arrangements, the measure prevents them from taking a view as members of a pension scheme-rather than as Members of Parliament-on the administration of that scheme. I hope that when we next consider the issue, a revised proposal will have been tabled after proper discussion with the trustees of the pension scheme. It beggars belief that no one thought that that was a necessary prerequisite for the clause.
I think that, in broad terms, the many new clauses and new schedules would implement what was proposed by Kelly, which is the only test to which I wish to submit them. As I have said, I think we should look further at aspects of them to ensure that they have internal logic and have been properly drafted, but I intend to support them. I hope that we shall be given an opportunity to improve them at a later stage if there are questions that remain unanswered, preferably as a result of the tabling of appropriate amendments by the Lord Chancellor.
Andrew Miller: I welcome the spirit of the exchanges that have taken place. I am sure all Members will agree that it is vital for us to resolve these detailed matters before the new Parliament, difficult though that task will be. As was pointed out by the hon. Member for Somerton and Frome (Mr. Heath), some of them will be harder to resolve than others. The hon. Gentleman also stole one of my lines. In my evidence to the Kelly committee, I recommended that all its members should read Plato's "Republic". I thought that that was not bad, coming from a secondary school boy. It seemed to me that this challenge had been in existence for 3,000 years and would continue, and that it was therefore important for us to try our best to give the right powers to IPSA and the compliance officer.
I, too, struggled with the issue of the way in which the post should be filled, although I accepted one of the arguments of the academic lawyers in one respect. I believe that the compliance officer should, as far as possible. be at arm's length from the IPSA membership. I am still struggling to come up with fresh ideas about exactly what should be the nature of the beast, but I think we all understand what we are seeking to achieve.
I intervened on both my right hon. Friend the Lord Chancellor and the right hon. Member for North-West Hampshire (Sir George Young) on the issue of pensions. Before I became a Member of Parliament, I spent a good part of my time negotiating on pension funds with large companies. In the context of accrued rights, the right hon. Gentleman spoke of the situation that occurs when a company is taken over. He may recall that in the
dim and distant past I tabled a private Member's Bill, some of whose proposals were incorporated in the Pensions Act 1995. I think that he made a fair point, and I agree that issues relating to accrued rights should be dealt with separately. Rights involving benefits that people have earned here and have transferred to the scheme, and the application of those benefits to family members-the potential of death in service, for instance-must be protected, as they are in the rest of the pensions world.
I think that we have dealt adequately with the question of trustees. I am sure my right hon. Friend accepts that, except in very few exceptional circumstances, member trustees can be appointed and dismissed only by members of the scheme. The number of such trustees is, I think, a matter for discussion, and it may need to be clarified.
Last week an article was published in my local press suggesting that IPSA should be responsible for determining the sitting days of the House-on the basis of a crass misunderstanding on the part of the person who wrote to the media assuming that when we are not here we are on paid holiday. All Members throughout the House surely agree that sitting times must be determined by the House itself.
I have some sympathy with what the right hon. Member for North-West Hampshire said about informal advice. None of us has enough time-or, in most cases, enough background skills-to make some of the finer judgments that are needed for running our offices when it comes to issues such as employment law or procurement. For example, I found myself needing to renew a lease for a photocopier in my constituency office whose terms caused me to want to take advice. We currently have a mechanism for that, although people have suggested that it is not very satisfactory. I agree that that should not be a function of the compliance office, to the spirit of whose role it would be entirely contrary, but it should be possible for a Member to say to someone, for instance, "I have been confronted with the following situation. Would you advise me to enter into this contract?"
I believe that those issues can be fine-tuned in time for Report. I hope that all Members will pull together to try to ensure that we create a mechanism that does not just work in practice, but provides the degree of confidence that the public rightly demand of the systems that we put in place.
Mr. Mark Field: I agree with my right hon. Friend the Member for North-West Hampshire (Sir George Young) that it essential for us to put these matters on to a statutory footing, and I welcome the Government's determination for that to be done. As my right hon. Friend said, nothing would be more damaging to the reputation of parliamentary democracy in this country than for the allowances scandal to permeate the next Parliament as it has permeated this one. These issues require urgent and definitive resolution, and, as a number of other Members have said, we owe it to the many people who will serve for the first time in the next Parliament to put the House in order, however belatedly.
I want to speak briefly on two of the new clauses. I am mildly unhappy about the proposal in new clause 73 that IPSA will not take on fully fledged responsibility for the setting of MPs' salaries until potentially as late
as 1 April 2012. I appreciate that the Secretary of State said that that was of IPSA's own doing, but we need to recall that this whole allowances scandal started because successive Executives over about the past 30 years refused or failed to implement Senior Salaries Review Body recommendations for salary increases. We heard a lot of grandstanding by party leaders over that period-and I acknowledge that leaders of Conservative, as well as Labour, Governments have been guilty of that. We therefore allowed a system to develop under which there was, effectively, a salary supplement through the allowances system, which grew like Topsy, especially after the resolution of the House in July 2001-without an SSRB recommendation-for a hefty 40 per cent. increase in the second-home allowance.
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I fear that failure to get this system on to a proper footing, and therefore reliance on the interim measure that has been in place since January 2008, will result in further grandstanding by party leaders over the next two years, which risks a further injustice being done. What happens if the formula that was set in place in January conflicts with, for instance, a pay pause in the public sector? If we choose the path of least resistance, how can we suggest that MPs are not once again setting their own salary-the problem that started much of this episode, which has been so corrosive to parliamentary democracy in the past nine months? I would prefer IPSA to be given the authority at once. I accept that it will need to be in touch with the SSRB, and this may well take as long as a year, so we might not be able to do anything until April 2011. However, giving a long-stop date that is, effectively, two years in the future will bring forth the potential for there to be lots of problems, which will mean that this issue will not go away in the next Parliament, as all of us would wish.
I also wish to say a few words about new clause 71, on the membership of the Speaker's Committee. I would have liked that Committee to have been abolished. We have a notional safeguard in place, as it is proposed that three lay persons should be appointed by resolution of the House of Commons, but we have to face facts. The Members Estimate Committee-body that preceded the Speaker's Committee-conducted itself, at the margins at least, in a disgraceful way. There was deliberate manipulation by party managers of all parties to ensure that, as far as possible, the public were kept in the dark. Why else did that body go to such unbelievable trouble to prevent publication of all the parliamentary expenses? We had a protracted High Court case that did great discredit to this House. I personally feel that the MEC- and now the Speaker's Committee-does not speak for me; I do not share the notion that it represents the interests of Members of Parliament. Rather, its behaviour has been one of the biggest problems. In view of what we are trying to achieve with IPSA, I would have liked all these matters to have been taken out of the hands of any such committee, and, indeed, out of the hands of the Speaker of the House of Commons.
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