Session 2010-11
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Superannuation bill


The Committee consisted of the following Members:

Chairs: Mr Joe Benton  , † Mr Roger Gale 

Baldwin, Harriett (West Worcestershire) (Con) 

Bray, Angie (Ealing Central and Acton) (Con) 

Crabb, Stephen (Preseli Pembrokeshire) (Con) 

Dodds, Mr Nigel (Belfast North) (DUP) 

Dromey, Jack (Birmingham, Erdington) (Lab) 

Gilbert, Stephen (St Austell and Newquay) (LD) 

Goggins, Paul (Wythenshawe and Sale East) (Lab) 

Graham, Richard (Gloucester) (Con) 

Hemming, John (Birmingham, Yardley) (LD) 

Hurd, Mr Nick (Parliamentary Secretary, Cabinet Office)  

Jowell, Tessa (Dulwich and West Norwood) (Lab) 

McClymont, Gregg (Cumbernauld, Kilsyth and Kirkintilloch East) (Lab) 

McDonnell, John (Hayes and Harlington) (Lab) 

Perry, Claire (Devizes) (Con) 

Roy, Lindsay (Glenrothes) (Lab) 

Spellar, Mr John (Warley) (Lab) 

Uppal, Paul (Wolverhampton South West) (Con) 

Williamson, Gavin (South Staffordshire) (Con) 

Chris Stanton, Committee Clerk

† attended the Committee

Column number: 93 

Public Bill Committee 

Thursday 16 September 2010  

(Afternoon)  

[Mr Roger Gale in the Chair] 

Superannuation Bill

Written evidence to be reported to the House 

SU 64 Karen Moody 

SU 65 Andrea Dunn 

SU 66 Alan Robson 

SU 67 David Mell 

SU 68 Lee Woolston 

SU 69 Alison Armstrong 

SU 70 Kathleen Devlin 

SU 71 Lorna Gibbon 

SU 72 Chris Young 

SU 73 Michael Lazzari 

SU 74 Michael Johnson 

SU 75 Pamela Gray 

SU 76 Maria Smith 

SU 77 Stephen Carey 

SU 78 Paul Stubbs 

SU 79 PCS 

SU 80 Gillian Moorhead 

Clause 2 

Final provisions 

1 pm 

Paul Goggins (Wythenshawe and Sale East) (Lab):  I beg to move amendment 4, in clause 2, page 3, line 14, at end insert— 

‘(2A) Section 1 shall not come into force until the Minister has laid a report of consultations that have taken place with the workforce and their representative trade unions under section 2(3) of the Superannuation Act 1972, and the House of Commons has come to a Resolution on a Motion in the name of a Minister of the Crown approving the report.’.

I warmly welcome you to the Chair, Mr Gale. I have served under your chairmanship on a number of occasions and you are always a very fair and helpful Chairman, so I look forward to this afternoon’s sitting. It may interest the Committee to know that, during the recess, an A380—one of the new so-called super-jumbos—landed at Manchester airport, in my constituency, for the first time, and the pilot of that aircraft could not have had more skill than my right hon. Friend the Member for Dulwich and West Norwood showed when she beautifully landed the debate on clause 1 within 30 seconds of the end of this morning’s deliberations. I shall also try to be— 

The Chair:  Order. I am bitterly disappointed. I thought that the right hon. Gentleman was going to say that it is now possible to fly by Flybe from Thanet to Manchester. 

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Paul Goggins:  We are working on that, Mr Gale. Clause 2 also raises a number of very significant issues, both in relation to the civil service compensation scheme and more generally for Parliament and for legislation. As per your guidance earlier, I shall make some general remarks about the clause as well as focusing more specifically on amendment 4 a little later. 

Clause 1, which we debated this morning, clearly deals with the substance of what may be on offer to the trade unions—to the work force. My right hon. Friend described the terms of the Bill as brutal and the Minister described them as austere, so none of us is in any doubt about the difficulties that staff will face if the terms of the Bill are in the end what is delivered. I am the first to acknowledge that Ministers—both the hon. Gentleman and the Secretary of State—have been very clear with the House and the Committee that they hope that this is not the final position and that, in a sense, this is a blunt instrument, to quote that expression again; it is a negotiating device. 

However, clause 2 gives the Minister an incredible set of accelerator and brake pedals to use in relation to the legislation. Those measures are of concern here and perhaps more broadly. Subsection (3) enables the whole Bill to fall after 12 months, but in subsection (4) we see a variety of devices to bring forward the date of the end of the Bill, to extend it beyond the 12-month period and, intriguingly, to reawaken the Bill at some future point should Ministers judge that necessary. I shall deal with that in more detail later. 

Whether this set of powers is an appropriate use of legislation is highly questionable. The message from the Committee is very clear and, I hope, increasingly shared on both sides of the Committee that the way to resolve the problem is not this miserable Bill, but sensible negotiation with the trade unions. That is entirely the right thing to do in a society such as ours. In a democracy, that is the way things should work. Indeed, I think that the general consensus now, from the evidence session the other day and the various remarks made by Committee members today, is that all six of the trade unions would now regard the principles of the February 2010 offer as a positive starting point for further negotiations. 

I pay tribute to my right hon. Friend, as the Minister did earlier, for her efforts over a long period of negotiation, leading to the February 2010 offer. Clearly, in the end that was not a complete success, but a huge amount of groundwork was done, which the Minister and his officials could build on and capitalise on if they approached negotiations now in the generous spirit in which I suspect the Minister personally would like to pursue them. 

The right thing to do is to enter the negotiations, rather than leaving the powers in clause 2 as the backstop measure by which to impose the miserable conditions set out in clause 1. That is what every member of the Committee has expressed as a wish, as a desire. We have put it in different ways, but in the end we all want a negotiated settlement. Relying on the powers in clause 2 gives the wrong message. 

It is important to negotiate rather than rely on such powers. We are constantly coming up against a difficulty, which we saw both on Second Reading and today. Negotiations are going on in parallel with the passage of the Bill. Inevitably, on Tuesday trade union officials were unable to comment further on particular questions.

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Indeed this morning the Minister was unable to comment further on certain detailed information. We understand that because we know that the negotiations must, to some extent, remain confidential. None the less, it is a very unpleasant experience for this Committee and for Parliament to be providing such wide powers to Ministers, trusting that somehow a negotiated settlement will emerge. There must be much stronger emphasis from this Committee that we expect a settlement to emerge. 

In urging the Minister to push for negotiation rather than the powers in clause 2, I should like to make the point that, if this turns out to be the final word, dreadful conditions will be imposed on those who are made redundant, but what will be the impact on those who remain? I am talking about the work force who feel that they have not been treated seriously and not been given proper respect. Yet this is also a work force who are crucial both to Government and to the delivery of public services. 

For all those reasons, I urge the Minister to get into the negotiations and not to rely on the powers in the clause. Many of us feel uncomfortable about this Bill and the way in which it has been pitched. From everything that the Minister has said, it is clear that he genuinely wants to find a solution. I noted on Second Reading that he felt quite affronted when some Members of the House treated his remarks about wanting to protect the low-paid rather discourteously. He was affronted, I think, at the thought that he would not want to protect those who are the lowest-paid. Nonetheless, as we discussed this morning in respect of clause 1, there is no specific additional provision for the low-paid. What we as a Committee should try to do is strengthen the Minister’s hand by ensuring that sensible negotiations are in place. 

In amendment 4, my right hon. Friend the Member for Dulwich and West and I propose a mechanism that will help to bring greater transparency to the negotiation process and, I hope, strengthen the Minister’s hand at crucial points in the discussions that he may need to have with some of his right hon. and hon. Friends. As we know from our time in government, such discussions can sometimes be quite lively. 

Amendment 4 proposes that the Minister brings back to the House a report that sets out clearly what negotiations have been carried out and how the terms of those negotiations have progressed. Parliament will then consider and make some judgment about whether those negotiations were conducted seriously. If it decides that the negotiations have not worked, it will consider where the blame lies. If the Minister and his colleagues in government know that a report has to be produced, that will ensure that the negotiations are more transparent and that there is a greater accountability to Parliament. Under the terms of our amendment, there then has to be an affirmative resolution, which means that there is another procedure to be gone through, thus giving this Committee or another Committee of the House the opportunity to consider the quality of the negotiations. 

There has to be a proper process of consultation. The negotiations did not get off to a good start; in fact they got off to a miserable start. Although this Bill has been described as a Bill to break through the deadlock, there were no prior discussions about its terms with any of the trade unions. It was merely published, introduced in Parliament and then the discussions started. It would have been rather better if there had been some constructive discussion before the Bill was published. 

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Now we are being told that the negotiations are fully under way and moving forward, and we certainly hope that they are. I have to say that I was greatly encouraged by the tone and content of the Minister’s questions at the evidence session on Tuesday, especially in relation to the questioning in the latter part of our proceedings about whether all the trade unions would be content to use February 2010 as a starting point. 

In conclusion, there is a mixture of factors. It would be wrong to use the devices in clause 2 to enforce the miserable conditions in clause 1. However, I believe that the Minister wants to do his best to protect the lowest-paid and wants the negotiations to work well. Given the poor way in which the negotiations started, we are left with the dilemma of whether we can simply leave the situation as it is. My right hon. and hon. Friends and I want the Minister to reassure us in relation to the negotiations. Why does he believe that it is not necessary to be accountable to Parliament through a further report and the affirmative resolution procedure? 

John Hemming (Birmingham, Yardley) (LD):  It would be nice to have some consistency from the Opposition. When they were in government earlier this year, so great was their urgency for a new agreement that they put through a statutory instrument to change the civil service compensation scheme without the agreement of all the trade unions. Now they are proposing a further delay with the amendment. There must be some consistency. Because of the country’s financial situation, things need to move on and cannot be allowed to drift for ever. 

John McDonnell (Hayes and Harlington) (Lab):  I offer my understanding of the amendment and some words of advice. The previous Government stated their negotiating position at the start of the negotiations and then negotiated for eight months. They thought that they had reached a deal and I believe that they were close to doing so. With a little honing of the offer, there may well have been a settlement that all the unions would have signed up to. The time scale of the general election intervened—I do not expect a Front-Bench response to this point—and put pressure on the previous Government to seal the deal. Given a few more weeks, I think that there would have been a settlement on a similar basis to that proposed by the previous Government. 

From what I understand of the current Government’s proposals, they have an old-fashioned negotiating strategy, whereby they take an extremely hard line, expect resistance and want to meet somewhere in the middle. The irony is that somewhere in the middle is the previous Government’s settlement. With a little flexibility, there can be a negotiated settlement. 

The amendment is important because the Government and Parliament need a longstop in the negotiations. There may come a time when the Government want to come to Parliament with a report that states what was said and what was put down so that the whole of the Commons can understand the rationale for their final position. That is what the amendment asks for. That would be good governance and good parliamentary governance because we would all understand, and therefore be implicated in, the final decision. That would push us back from the current brink. 

The problem with all such negotiations is that, when one side wins, if all sides do not understand that they have got the best deal that they could possibly get, there

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will be collateral damage. A settlement that is begrudged on one side will not stick for long. For the period that it does stick, it undermines the morale of the staff concerned. The problem then comes back in another form. 

Another form of industrial relations is the spitting in the soup negotiations. Although the employers might well win, the staff who serve the managers’ soup will spit in it beforehand. We do not want to generate that sort of attitude in the civil service as a result of an imposed or begrudged settlement. The amendment is perfectly reasonable. It enables the Government to come back with a report to explain their final position before implementation. It enables Parliament to take a view, to have a serious discussion if necessary about whether the settlement is accepted or imposed and to realise, if imposed, that we are going over the brink. 

1.15 pm 

If the settlement is imposed, there will be consequences for industrial relations, not just in the civil service, where I think there will be industrial action, but across the public sector and elsewhere. The lesson of history is that one spark, from one industrial dispute, can set off a whole, bitter range of destruction in an industrial relations climate, which damages the country as a whole. 

The amendment enables the Government to come back and say, “This was our aim in the negotiations. This was our position. This was their position. This is what we are recommending”, enabling the House of Commons to take that final decision ourselves—whether to accept the settlement or to go over the brink into what could be a dangerous situation. 

Richard Graham (Gloucester) (Con):  The Minister for the Cabinet Office remarked in the House of Commons at the beginning of the Superannuation Bill debate that had agreement been reached earlier in the year, the case for accepting it would have been pressing for everyone. Does the hon. Gentleman not agree that in this instance, for a particular trade union to have chosen to disrupt the course of the negotiations was a tragedy? Had agreement been reached, we might not be here today. 

John McDonnell:  I am an old Hackney class warrior, but I am trying my best not to fall into the sort of language used by the hon. Gentleman. It is not constructive in our discussions to argue whether one union has disrupted negotiations or whatever. The Public and Commercial Services Union took a position based on the interests of its members—it could do nothing else. It is now trying to ensure that there are proper negotiations in a fruitful atmosphere. Are we not doing the same? Going over the past and isolating one union from the others is not constructive, and is almost trivial when considering what we face. I am giving some importance to the negotiation in its own right—of course—but also to its consequences for the industrial relations climate of this country. 

Richard Graham:  The point I was gently making is that it is surely in all our interests, including that of every member of all the trade unions involved, to achieve a long-term settlement, which is sustainable for

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the unions, for the Government and for the economy of the country. Therefore, in the clash between short and long term, surely it is in everyone’s interest to focus on the long term. 

John McDonnell:  Of course. The hon. Gentleman is completely right. I am desperately trying to see the issues from all sides at the moment. I can understand the Government’s position even though I do not agree with it. I do not agree with their whole economic scenario—we had that debate in the Chamber, when I set out my Marxist analysis of the argument, but never mind. I do not agree with the Government’s position but I understand where they are coming from. 

We use the expression, “We are where we are”, and where we are at the moment is understanding what will let us arrive at a reasonable settlement or solution. That means looking at individual union perspectives. In the last negotiations, the PCS clearly felt that it could not carry its members with it on the settlement, because so many of them were losing out. We had the potential for a little honing of the agreement in order to reach a solution. That is where we are at the moment in the negotiations. 

The amendment, therefore, would given openness to the debates, because the Minister could say, “At the end of these negotiations, I will report them to Parliament and Parliament will decide.” Doing that strengthens the Government’s hand, enabling them to set out the reasonableness of their argument and to expose the other side, if it has been unreasonable, or vice versa. 

The amendment would give us that one, final moment. I do not want to exaggerate, but it could be a moment in history for the Government—either to agree or to go over the brink. The amendment enables the Government to step back from the brink; it enables the whole House to step back from the brink, if the settlement is that problematic, or, if necessary, to unite on an agreed solution that may eventually have to be imposed. 

That is democracy. I do not understand why there is any opposition to the amendment, as I think it gives a way of involving all of us in the process, which will be good—from my position—for the country overall, but from the Government’s position, certainly good for their standing. 

Finally, I think affirmative processes are quite proper for issues such as this. It is important to involve the whole House in significant decisions in the history of this country and the decision-making process of any Government. That is a basic democratic right for individual Back-Bench Members such as me, who otherwise would not have a final say, in the light of the state of the negotiations as reported. 

Harriett Baldwin (West Worcestershire) (Con):  There seems to be a real problem about the amendment, although I would be happy to take interventions if I am incorrect. If the amendment were agreed to, it seems to me that two things on which we have all agreed throughout the whole debate—that we should have a negotiated settlement, and that the current arrangements need to be changed—would run the risk of not taking place. 

I understand that until clause 1 comes into force, the current arrangements would continue. We have heard many people on both sides make the case that there

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needs to be a change in the current arrangements. For that reason, I think the amendment has significant problems, and I will not be able to support it. 

Paul Goggins:  Does the hon. Lady acknowledge that regardless of whether Parliament should be caught up in the discussion about the negotiations, we are now caught up in it? Therefore, it is quite legitimate, in terms of the amendment, for Parliament to say that we have heard about the negotiations, which the Minister tells us he hopes will go well and will protect the low-paid, but that Parliament now has an interest in the matter and we expect a proper and formal report on those negotiations before we take the final, dreadful step of imposing the conditions in clause 1. Does she not think that Parliament has the right to exert that influence? 

Harriett Baldwin:  During our proceedings, we have been asking a lot of questions about the current state of the negotiations. Both sides have told us consistently that as they are in negotiations, they are not able to give us much detail. The amendment would create an incentive for the unions to carry on negotiating for a long period, because the current rules would remain in place until clause 1 came into force. Given that both sides in the discussion have agreed that the current arrangements need to be altered, implementing the amendment would cause a problem. 

Jack Dromey (Birmingham, Erdington) (Lab):  On Tuesday, the hon. Lady asked this question: 

“If the February 2010 deal were now offered again to your members do you think that they would vote to accept it at this point?”––[Official Report, Superannuation Public Bill Committee, 14 September 2010; c. 56, Q124.] 

Am I right that the clear suggestion inherent in the question is that the hon. Lady believes that the February 2010 deal should be put back on the table? 

Harriett Baldwin:  I asked the question to see what the answer would be, rather than to my personal opinion as a humble Back Bencher about how the negotiations should take place. 

Gregg McClymont (Cumbernauld, Kilsyth and Kirkintilloch East) (Lab):  I have been listening closely to what has been said so far, and I want to focus on what I think underpins our amendment and where we see the process going. 

I want to talk about productivity. It was mentioned this morning that the most important thing is to prevent job losses, which I think is absolutely right. However, we have to consider the productivity of the workers involved. We have already had, in the past 10 days, the difficulties at Her Majesty’s Revenue and Customs, which led to a statement to the House. Only yesterday, the Governor of the Bank of England suggested that the case for cracking down on tax avoidance is irresistible. Underpinning what Labour Members have said in the Committee is the sense that, without a negotiation at this stage, the morale of the work force will be so depressed that they are unlikely to respond positively to innovations that the Government will rightly want to introduce in how they work. We have to think closely about that. The Government will be sending a message about how they wish to conduct their industrial relations, which is important for a new Government. 

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John Hemming:  Does the hon. Gentleman agree that organisations that face making redundancies tend to have morale problems? The sooner such issues are resolved, the sooner morale can rise again. 

Gregg McClymont:  There is something to the hon. Gentleman’s point, but in this case the Government are not necessarily the same kind of employer as a private sector employer. On Tuesday, one of our human resources witnesses mentioned the importance of brand. Alongside other reasons why people decide to work for the civil service is the notion that the Government will treat them fairly, perhaps more fairly than if they were in the private sector. From that point of view, the message the Government send out early in their term is important for the entire public sector. I know from his comments that the Minister is concerned about that message, so it is worth our ruminating on morale. 

The Parliamentary Secretary, Cabinet Office (Mr Nick Hurd):  I am grateful to the right hon. Member for Wythenshawe and Sale East for making it clear, in moving his amendment, that the way forward is by sensible negotiation. I am grateful to him for that, given the noise around this emotive Bill. The amendment would change clause 2, which is an emotive clause. It provides for the Bill to be time-limited. I stress and place on the record that the Government have no desire to see the legislation continue any longer than is absolutely necessary. 

The Minister for the Cabinet Office has stated on the record, and I join him in stating, that he would be pleased if the Bill never reached the statute book because it was not required, having been replaced by a negotiated settlement. I would be happy to join a short list of Ministers who have failed to take a Bill through Parliament, in this case because it was superseded by events and was no longer necessary. The inclusion of a sunset clause prevents the legislation from continuing ever onwards. Instead, if the Government wished to renew it, we would be obliged to return to it. 

My reading of the amendment is that its purpose is to delay implementation of the Bill until the House is satisfied about consultation with the work force. The idea behind that is to ensure that the Government have sought and taken into account the views of the work force and their representatives on any changes to the compensation scheme, but the potential consequence would be to delay the Bill until a new scheme had been agreed. That is my understanding. The Government completely understand the concern about consultation, the need to engage and—as the old Hackney class warrior put it—the need to take people with us through the extremely delicate and difficult process on which we are about to embark. 

The Superannuation Act 1972 requires that where a scheme is made under section 1 of the Act, or that scheme is amended by way of another scheme, there must be consultation with affected employees or their representatives. In case the point is not clear, that requirement does not apply when a scheme is altered by primary legislation, rather than by amending the scheme. I make that point for the record, but I will not dwell on it or build on it. The main point was made by the right hon. Member for Wythenshawe and Sale East, which is that the end game must be a negotiated settlement. That

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is the urgent priority. It is urgent, because after the spending review on 20 October, we will be months—arguably weeks—away from a situation in which mangers will have to take very difficult decisions about head counts. 

1.30 pm 

Jack Dromey:  On the end game, the Minister said in Committee on Tuesday, 

“May I push you a little further, Mr Lewtas, on what has been a common theme of Committee members’ questioning? Let me put it more explicitly today. Would you, as an executive, recommend to your members acceptance of the February package?”––[Official Report, Superannuation Public Bill Committee, 14 September 2010; c. 64, Q146.] 

It could not be clearer. I take it that the hon. Gentleman meant that the Government might be prepared to re-table the February package. 

Mr Hurd:  With a great deal of respect, the hon. Gentleman has over-interpreted my position and my interest. I was giving the gentleman speaking for the PCS an opportunity to place on record the view of the union towards the February package by asking him specifically whether it would recommend it. The hon. Gentleman should not read into that an interpretation of the Government’s position in relation to the February package, which we discussed exhaustively this morning. 

To return to the amendment, I was referring to the urgent priority to reach a negotiated settlement. As for meeting the concern of hon. Members about adequate consultation with union members and civil servants, it will of course be the case that, when we reach an agreement, which is the expected outcome, there will be a proper consultation process not only because that is a statutory requirement, but because it is the right thing to do for reasons that the hon. Member for Hayes and Harlington explained. 

In the meantime, the priority is to reach a negotiated settlement that will, by definition, contain an element of consultation. I assure the right hon. Member for Dulwich and West Norwood that those negotiations are being conducted very much in line with the principles that she established in her own negotiations. In that context, as and when we reach a deal, the Bill is dead and there is no need to consult on the terms. The main reason why we will oppose the amendment is that it would effectively undermine the purpose of the Bill in delaying implementation. As I think I made clear this morning, the purpose of the Bill is to break a deadlock and make it more possible that a deal is done quickly. It is about breaking the deadlock and changing the dynamic of the negotiation. Delaying the Bill’s implementation, as the amendment proposes, would undermine that rationale and logic. 

As my hon. Friend the Member for West Worcestershire said, such a delay could have negative and complicated consequences for staff in the sense that, until the Bill is implemented, the old terms apply. As was debated extensively on Second Reading, there is a feeling certainly on the Government side that the current terms carry a risk of distortions in respect of decisions because the current terms favour so clearly certain groups of people and thus contain a risk that decisions will be taken not

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on the basis of ability, but on the basis of the relative cost of letting people go. That is clearly a situation that we do not want to prevail. 

John McDonnell:  All the amendment does is enable the Government to secure their Bill, and give them just that bit more flexibility on the final timing of the end of the negotiations. If the Minister thinks that the unions or others will get the incorrect message that there is a lack of urgency, let us place it on the record that everyone agrees that there is a sense of urgency about concluding the negotiations. Let us not allow false messages to come out. 

It has been Government practice—good practice—that when there is a fairly momentous decision to be made, the whole House is included. The amendment follows that practice of bringing a report before the House and then the House taking the final decision before—hopefully not—the Government go over the top. That is all the amendment does. It gives the Government additional flexibility. 

Mr Hurd:  I understand the point that the hon. Gentleman makes, although it is appropriate to say that I cannot recall the contents of the previous negotiating process being reported to Parliament. I am happy to be corrected on that. I come back to the point that I stressed this morning, which is that there is a fundamental principle that the discussions are confidential on both sides at this point, and therefore it is not desirable to set out the Government’s position in a report. Neither side will be keen on revealing the contents of discussions before a final position is reached. We are prepared to consider presenting something to Parliament once the position has been finalised, but not before. 

The point that I am trying to stress and why we oppose the amendment is that it would ensure that the current scheme continues until the report is approved. As I stressed before, we are seeking to achieve a negotiated settlement. Once discussions with the unions are complete—we are determined they remain confidential until they are complete—we will consult staff. 

On the point made about the role of the House of Commons—every Member will have a view—I am not sure that it would be appropriate for the House of Commons to be involved at such a detailed level in the internal functions of the civil service, as suggested by the amendment. Parliament has an important role in legislating and holding the Executive to account. It would not be appropriate or right for the House to be involved in the minutiae of the management process. As I said, it was not so involved in the negotiations conducted by the previous Administration. 

Paul Goggins:  I am sure that the Minister will acknowledge that Parliament is being asked to take an enormous step—to sanction a set of conditions for redundancy, which the Minister himself says he does not wish to impose on the work force. He wants something that will be better, particularly for the lower-paid. The amendment addresses the very unusual circumstances. He is asking the Committee to approve a set of conditions that he himself hopes will not be necessary. The least we ask is that he comes back at an appropriate point to report on the negotiations that have taken place. What could possibly be wrong with that? 

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Mr Hurd:  If the right hon. Gentleman had listened carefully to my remarks, I said that we are prepared to consider presenting something to the House once the position is finalised, but we are not prepared to hold up implementation of the Bill until the report is approved. 

I have set out the reasons why we cannot support amendment 4, but we recognise the signal that it sends about the need for proper engagement with staff at a time of considerable anxiety and insecurity. 

Paul Goggins:  The Minister made some remarks about the sunset clause and the other provisions in clause 2, which I want to come to in a little more detail when we discuss amendment 5. I assure him that I heard what he said and I welcome the offer he made, whether or not our amendment is accepted this afternoon by the Committee. His offer to keep the House informed on negotiations, particularly at crucial times, is a genuine offer and is received in the spirit in which it is made. 

We are trying to strengthen the Minister’s hand. If the Government know that the Minister must return to Parliament and give a genuine, open and transparent report on the negotiations, it strengthens his hand to make sure that those negotiations achieve his aim of a reasonable, negotiated settlement that protects the lowest-paid staff. It is a genuine attempt to strengthen his hand. Now that Parliament has been drawn into this in a way that it did not ask for—this Government Bill is quite unusual in its terms—it has an interest. It is important that a formal mechanism is in place for reporting so that before the potential dreadful conditions could be imposed, which the Minister himself tells us that he does not want to impose, Parliament would have a chance to consider the quality of the negotiations and to see that everything possible had been done. 

In response to the hon. Member for West Worcestershire—who, far from being a humble Back Bencher, is establishing a reputation for fair-mindedness in the Committee and elsewhere—our amendment would not provide for an indefinite delay. It would not give the trade unions a veto for ever, allowing them to prevent the publication of a report and thus stop an affirmative resolution on the conditions in clause 1 taking place. It simply states that the Minister must produce 

“a report of consultations that have taken place”. 

Those negotiations might have fallen apart and there might have been no agreement, and the Minister would have to come back and report that; an agreement would not be required first. There may be some delay, but it would not be an indefinite delay. 

John Hemming:  Is the right hon. Gentleman saying that the Opposition would back the Bill if the amendment were accepted? 

Paul Goggins:  The purpose of opposition is to try to ensure that the Bill is properly scrutinised, and to take opportunities to make the Government more accountable when we see them. We certainly do not back the Bill, and we have made clear the reasons why. We think that negotiation is the way forward; we do not think that this is the right way to do things. When opportunities to strengthen the legislation and make Ministers more accountable arise, however, we will take them. 

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Harriett Baldwin:  It strikes me that if the amendment were passed there would be a considerable incentive to continue negotiating indefinitely. It would always be possible to say, “We are still negotiating.” That incentive would be provided by the fact that the current conditions would remain in force during that period. 

Paul Goggins:  I accept that there would be some delay, but I think that that delay is merited because of the gravity of what Parliament is being asked to sanction. Interestingly, when the Minister responded to my hon. Friend the Member for Birmingham, Erdington, he could not tell us whether he had been offering a new starting point for negotiation in the exchange that he had in Committee on Tuesday. In a sense, we do not know whether that is now a new point for negotiation. We have to trust the Minister to go away and negotiate. The required report would be a way of ensuring that we get feedback on whether the Minister went away and made a genuine offer that was flatly rejected by other parties to the negotiations. We would know where we stood when we took the final decision, so the delay would be merited. 

John Hemming:  The right hon. Gentleman says that delay is now merited. Why was it not merited earlier this year? 

Paul Goggins:  I will now come on to the remarks that I was going to make in response to the hon. Gentleman’s comments earlier. He talked about the Government rushing into this earlier in the year. I remind him—he knows this, but it is worth restating—that my right hon. Friend the Member for Dulwich and West Norwood and her team entered into extensive, painstaking negotiations over a period of eight months. They put out a consultation document, “Fairness for All”, to which 18,000 people responded. My right hon. Friend could not have been more painstaking, and five of the six unions accepted the terms that were offered in February 2010. One did not, and we all know the story there. 

Government is a responsible position, however, and Ministers have responsibilities. We were approaching a general election and people needed to know where they stood. We knew, crucially, that had we won that general election we would have needed to deal with the deficit. The package that my right hon. Friend put forward in February would have saved £500 million over three years. It was not rushed government, it was responsible government that she was conducting. 

1.45 pm 

John Hemming:  How much delay would be reasonable now? 

Paul Goggins:  I will not specify a time. The point of negotiations is that an end date is not set out—goodness me, as a former Northern Ireland Minister, I find myself getting into familiar territory here. In that context, once an end date is put in place, people know that an agreement will not be reached by then because it becomes an obstacle to negotiations. I will not suggest a date, but I do not expect the negotiations to go on for ever. 

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If the Minister had been genuine and open but unsuccessful, because other parties refused to respond in kind, he would be at liberty to come back. I am not going to set out time limits. It is in everybody’s interest to have certainty, particularly in the current climate, where we know that horrendous cuts in public expenditure are going to be meted out on the public services—those who work in public services also have an interest in certainty. That is why I think that negotiations—if those were done genuinely with February 2010 as a starting point—could be conducted briskly in order to bring certainty to this issue. 

I do not intend to press amendment 4 to a Division. We have honestly and robustly rehearsed the issues across the Committee. The Minister and his officials will engage in the negotiations and, on Report, we will no doubt have some information about the progress of those, even if it is not possible at that stage to go into detail. We may look again at ways in which we can make sure that Parliament retains its interest in this controversial measure, but we do not want to press the amendment to a vote. 

I beg to ask leave to withdraw the amendment. 

Amendment, by leave, withdrawn.  

Paul Goggins:  I beg to move amendment 5, in clause 2, in page 3, leave out lines 20 to 27. 

I referred earlier to the various accelerator and brake pedals that the Minister seeks to give himself through the legislation. Although I have made it clear that we do not accept the terms of the Bill—it is not the way we wish to proceed—if we take the terms on which the Minister is presenting the measure, it is understandable that he wants negotiations to carry on and to be completed. Therefore, having a sunset clause, 12 months after the Bill is enacted would make sense in his terms. It would mean that the Bill, which was no longer needed, would come to an end. It is also perfectly understandable, in his terms, that he may want a provision that enables him to bring forward the date at which the Bill will no longer be required. If negotiations are successful, he has admitted that the Bill will not be necessary. 

The Opposition have serious difficulties with the Bill in relation to two further provisions. Those concerns are applicable not only to this matter, but in a wider sense to Parliament. The first is the provision to extend the period beyond the 12-month sunset clause to a further date, during which time the conditions in clause 1 could be applied. That implies that the Minister is half expecting that the negotiations may not be concluded even by the earlier part of 2012, which is at variance with the messages that we hear from Ministers. I am keen to hear why the Minister needs the power to extend further the date of the sunset clause. 

More intriguingly, he wants to give himself a power to bring the legislation back if it is needed some time in the future. I am trying to understand how that process would work. For the sake of argument, let us say that despite our best endeavours the Bill is enacted, but before or after that happens, there is a negotiated agreement with the trade unions for something better than the provisions in clause 1. However, although that is agreed by negotiation, at some point in the future the Minister

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may suddenly want to revive the conditions in clause 1. That does not seem to make sense. Both in relation to the Bill and in general, the Minister should explain why he needs that power of extension and the power to revive the conditions—the “sunrise power”, as it has been called. 

The sunset provisions are not merited by this kind of issue. I have referred to my time as a Minister in Northern Ireland, and in some of the legislation for which I was responsible, I made use of sunset clauses, but in rather different circumstances. For example, in the Justice and Security (Northern Ireland) Act 2007, we had a difficult judgment to make about whether we still needed provisions for judge-only trials, which is a highly contentious issue. As Ministers, we judged that we still needed such powers, but we made a provision in the Bill that they would end after two years unless there was a further resolution of both Houses to keep them in place. We thought that there was a controversial situation that might change, so Parliament would want to keep a close eye on developments before it decided to reinstate the provisions. When there is controversy, there may be a reason for a sunset clause and an opportunity to renew powers, but not when negotiations are going on outside this place between trade unions and management. That does not make sense. 

I also recall a situation when a sunset clause was put in place because the parties in Northern Ireland could not agree when we were trying to set out a new model for a justice Ministry, following the devolution of policing and justice. It was hard to find agreement, so the Government held the ring as an honest broker and introduced a further model, which is now working. That is sunsetted until 2012, when it will be important for the parties to reconsider the arrangements and make fresh proposals. 

The Government can set a sunset clause as an honest broker, which means that the other parties must get on with it and come up with a solution of their own. I do not understand, however, why sunset clauses of that type are warranted in this context. Why, in particular, is it necessary to have a provision to extend beyond the sunset of 12 months? Why on earth is it necessary to have a provision to bring the powers back into force long after a negotiated settlement may have been agreed? 

Mr Hurd:  Amendment 5, in effect, will remove a Minister’s ability to postpone the sunset clause or to revive clause 1 once it has lapsed. The apparent intent of the amendment is to ensure that the measure has a definite end date to prevent the Minister’s being able to extend it beyond 12 months. 

In reply, I return to our starting point: we want and expect to reach an agreement quickly, which is the purpose of the Bill. It is a catalyst to try to break the deadlock and make that happen. Clause 2 provides for the effects of the Bill to be time-limited and we have no desire to see the legislation continue any longer than is absolutely necessary. The clause includes the option to bring forward the termination date, which signals the Government’s position. 

The powers under clause 2 are necessary, particularly if we cannot reach a quick agreement. We must avoid finding ourselves back in the current situation. The House and the Committee have reached a common

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view that the current scheme is unaffordable and inappropriate. If, however, changes were quashed in ways that we cannot predict, and we were forced to revert to the current scheme, the ability to extend the sunset clause, which was the focus of the right hon. Gentleman’s inquiry, increases the incentive to reach an early agreement. That is the fundamental point and that is what we want to deliver. The Government’s ability to revive the measure, if necessary, may mean that the legislation can be repealed sooner than it otherwise might have been. Without that power, it is possible to argue that the Government could be minded to allow the Bill’s effects to continue until there is no risk at all that any future scheme would be quashed. 

Jack Dromey:  May I ask the Minister two questions arising from what he has said? First, does the suggestion that the clause is necessary in the event of the provisions of the Bill being quashed suggest uncertainty on his part as to what might happen in the event of a legal challenge? Secondly, are there any circumstances in which, once an agreement is reached, the provisions of the Bill might be used on a second occasion to change for the worse the terms and conditions of employment for civil servants? 

Mr Hurd:  No, that is certainly not the intention. The Bill only allows the Minister to improve the terms; there is no capacity to reduce them. We want to try to maximise flexibility to achieve what I think we all want, which is a negotiated settlement as quickly as possible. In that context, I have two specific answers. On the need to maintain the ability to revive the Bill, Mr Dusty Amroliwala, in his evidence to the Committee, addressed that well when he talked about arguably remote but real risks in the future when, for example, a change to the scheme might actually be approved by union members in a ballot, but be subsequently challenged in a court, perhaps by an individual. The hon. Member for Hayes and Harlington signalled that as a possibility. We want to protect ourselves against a return to the situation we are in now, where by default the current terms are in place. The ability to extend the Bill or extend the sunset provision sends a strong signal and an incentive to the negotiators to get the deal done quickly, because it is not something that can wait for 12 months. 

My final point is one I should have made earlier. The ability to revive or prolong is clearly set out as requiring the approval of the House. That is important and I should have stated it much earlier. It is self-evident why that is necessary, because these are unusual arrangements. However, we assure the Committee and the House that any changes to revive or prolong would require the approval of the House. 

John McDonnell:  It is positive that there is provision for the affirmative procedure, but that is still a power by ministerial order. The argument that the power to revive the terms of the Bill is on the basis that the terms of the Bill will be challenged, and that the challenge will be successful in court, defies logic. That would simply revert us to the original Bill, so we will go around the same circle continuously. That is like groundhog day, so I do not think that can be the argument. It needs to be clarified, perhaps in a note, because I am not completely sure about the logic of the recommendations from civil servants on the drafting of the Bill. 

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What would be really helpful are other examples when the award to a Minister of a futuristic power has been made in this way, because I cannot think of any, apart from emergency legislation. I now understand why the Government are seeking to have the measure classified as a money Bill, because I cannot see this power going through the House of Lords. We are all opposed to retrospective legislation, but we are even more opposed to giving powers to Ministers in perpetuity to bring back a scheme of this sort, even by affirmative order. 

2 pm 

Mr Hurd:  I shall not be drawn into discussing whether this should be a money Bill. That is beyond my powers and my understanding of Erskine May. However, I know a man who understands those things very well and he is called the Speaker, which is just as well as it is his decision. We will have to wait for that. He does not have to make the decision now, but it is his to make and all of us who know him will know that he will make it on the basis of a great deal of knowledge of process. 

To clarify a point on which the hon. Member for Hayes and Harlington was confused, we are concerned about the risk—a remote but real risk—of a challenge to a revised scheme, not to the Bill. The central argument is about why the Government require the powers that amendment 5 challenges. 

I conclude by repeating the central argument that the Government’s ability to extend or revive the Bill is necessary. Without such powers, we could find ourselves in 12 months’ time in exactly the same position as we are in now. We desperately need to avoid that, because the overriding aim and the whole driver of this controversial Bill is to break the deadlock and act as a catalyst for serious negotiation, because it is in everyone’s interests that the situation is resolved as quickly and fairly as possible. 

Lindsay Roy (Glenrothes) (Lab):  Is the Minister suggesting that the current negotiations are not serious? 

Mr Hurd:  No, I certainly do not want to be interpreted as having made any such suggestion. Various allusions have been made to my involvement in the negotiations, so I should clarify that I am not directly involved day to day in the negotiations, which are being conducted at official level with officials reporting to my right hon. Friend the Minister for the Cabinet Office. My understanding is that negotiations are being conducted in a serious, progressive and sensible way and that they are moving along. We want to protect ourselves and avoid returning to the present situation in 12 months’ time. That is why the powers are necessary and that is why we propose to reject the amendment. 

Paul Goggins:  The Minister has confirmed that he is not directly involved in the negotiations, which is perfectly understandable. I hope, however, that he will take away with him some of the firm and clear messages that have come out of today’s proceedings, including that the whole House wants to see a negotiation, rather than the imposition of the conditions set out in clause 1. 

I remain concerned about some of the arguments that the Minister has made. I take him at his word when

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he says that he wants a negotiated settlement and that he wants it quickly. It makes perfect sense, from his point of view, to include a sunset clause—12 months is reasonable—and reinforce it with the power to come back to the House and bring that date forward if negotiations are successful. However, he proposes to give himself further powers to extend the point at which the sunset clause will kick in, with sunrise powers to bring back the Bill’s provisions in case there is further disagreement later. He ought to be more straightforward and not have a sunset clause at all; he can always come back to the House and rescind the legislation in future. 

Either the Minister really means it when he says that the settlement must be short and quick and negotiated soon, or he needs to be clear that the process could go on for a very long time, in which case he should be honest and tell the Committee that he wants the powers for as long as they are needed. To include a sunset clause that allows him to bring the date forward, or knock it back and bring the powers back, is to give himself unprecedented and far-reaching powers that are unwarranted. I am afraid that he has convinced neither me, nor, I suspect, my hon. Friends. I urge them to vote in favour of the amendment. 

Question put, That the amendment be made:— 

The Committee divided: Ayes 8, Noes 10. 

Division No. 2 ]  

AYES

Dodds, rh Mr Nigel   

Dromey, Jack   

Goggins, rh Paul   

Jowell, rh Tessa   

McClymont, Gregg   

McDonnell, John   

Roy, Lindsay   

Spellar, rh Mr John   

Column number: 110 
NOES

Baldwin, Harriett   

Bray, Angie   

Crabb, Stephen   

Gilbert, Stephen   

Graham, Richard   

Hemming, John   

Hurd, Mr Nick   

Perry, Claire   

Uppal, Paul   

Williamson, Gavin   

Question accordingly negatived.  

Question put, That clause 2 stand part of the Bill. 

The Committee divided: Ayes 10, Noes 8. 

Division No. 3 ]  

AYES

Baldwin, Harriett   

Bray, Angie   

Crabb, Stephen   

Gilbert, Stephen   

Graham, Richard   

Hemming, John   

Hurd, Mr Nick   

Perry, Claire   

Uppal, Paul   

Williamson, Gavin   

NOES

Dodds, rh Mr Nigel   

Dromey, Jack   

Goggins, rh Paul   

Jowell, rh Tessa   

McClymont, Gregg   

McDonnell, John   

Roy, Lindsay   

Spellar, rh Mr John   

Question accordingly agreed to.  

Clause 2 ordered to stand part of the Bill.  

Ordered,  

That certain written evidence already reported to the House be appended to the proceedings of the committee.—(Mr Hurd.)  

Bill to be reported, without amendment.  

2.7 pm 

Committee rose.