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Lord Mackay of Ardbrecknish: My Lords, I had hoped to have rounded up a fairly successful day in hearing news that the Government had managed to come to a solution to this problem, as they have to a few others we discussed. However, this is a difficult issue and I do not pretend for a moment that it will be easy for the Government to resolve it.

I perhaps missed out one other point that concerns the industry; that is, that whatever the solution is it will incur some costs. Will the industry need to put into place that system immediately the Scottish parliament is up and running, or could it wait until the parliament decided whether or not to use the variable rate? It may be that the parliament may decide never to use the variable rate and it would be daft if the industry had to go to a great deal of trouble and expense, even if it were minimised, if it were never needed. Perhaps that is something the Minister can also reflect on in his deliberations.

As I understand it, the Labour Party is committed now to saying that it will not increase the tax, because other parties certainly are. The only party that wants to increase the tax is the Liberal Democrat Party, in order to do good works as it sees it. But if I were advising the pensions industry I would tell it not to worry too much about that. It is an important issue for the pensions industry, and that aspect ought to be borne in mind by the Minister. It is not just a question of finding a solution; it is also a question of asking whether the industry needs to do something about this immediately the parliament starts, or whether it can wait until parliament decides it wants to use the SVR.

I am grateful to the Minister for his thoughts on the matter. I hope, though not with much faith, that we will have a solution by the time we reach Third Reading so that this matter may be put to bed. The Minister indicates that that is doubtful and I appreciate that. However, I have assurances that efforts have been made to find a solution which will be to the satisfaction both of the Treasury and of the pensions industry. Mindful of the fact that the Government keep telling us of the importance of pensions, despite the £5 billion hike they have put on pensions under ACT--I could not resist that--they will attempt to find ways to help the industry if they have to change their systems in order to accommodate different types of taxpayers within the United Kingdom. On that basis, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

28 Oct 1998 : Column 2063

Clause 78 [Limits on salaries of members of the Parliament]:

Lord Mackay of Ardbrecknish moved Amendment No. 160:

Page 36, line 39, leave out ("ensure that") and insert ("make provision for").

The noble Lord said: My Lords, this amendment relates to Clause 78, which deals with a situation in which an individual is a Member of the Scottish parliament, the House of Commons and of the European Parliament. It lays down, in the usual prescriptive manner, what should be done; namely, that the salary ought to be reduced.

At Committee stage I had a rather unsatisfactory exchange with the Government Front Bench. The clause says that the salary should be reduced by a particular proportion. I could not get any kind of ball park figure as to what proportion the Government might have in mind. It could be 1 per cent., and in my view that would obey entirely this clause in the Bill. It could also be 99 per cent., and that would also entirely obey Clause 78. The Government must have some idea about what they mean in this context.

However, having had lectures about not being prescriptive, I decided simply to redraft the clause by removing the prescriptions and saying that Parliament shall make provision,

    "that the amount of salary payable to a member of the Parliament is in accordance with section 77",

if any salary is payable to him because he is a Member of the other place or the European Parliament and leave it like that. It should be left to the good sense of the parliament. Even at this time of night it is an amendment that should appeal to the Government. I say to them that they ought not to be prescriptive. They should trust the parliament's good sense to treat this matter properly, seriously and sensibly. I look forward to the acceptance of this amendment by the noble Baroness, Lady Ramsay of Cartvale, who, to date, has not accepted any of my bright ideas. I beg to move.

Baroness Ramsay of Cartvale: My Lords, I think that we are all in agreement that there should be something on the face of this Bill which deals with the prospect of a member of the Scottish parliament being in receipt of an additional salary as a Member of either the other place or the European Parliament. But the difference we have is how this is achieved. The obvious way to deal with it is to reduce or abate the salary received as a member of the Scottish parliament. Clause 78 ensures that this will happen.

I appreciate the concerns raised by the noble Lord, Lord Mackay of Ardbrecknish, and other noble Lords at Committee stage who consider that this issue should be left entirely to the parliament. However, in this instance we disagree. We believe that the public will expect us to ensure that some action is taken to reduce salaries when a member is claiming a salary from another parliament. The level of any reduction, however, should be for the parliament to determine and this is precisely what this clause provides. In response to Amendment No. 162 proposed by the noble Lord we consider that

28 Oct 1998 : Column 2064

Clause 78, as it is drafted, goes a long way to allowing the parliament freedom to decide what reductions there should be in the salary of those members who have a dual role.

The level of reductions to salaries is not fixed. We believe that the parliament will be responsible enough to the electorate to set appropriate levels and what we have provided in Clause 78(2) gives considerable discretion to the parliament to decide what reduction there should be.

Under this clause there is nothing preventing the parliament, as the noble Lord, Lord Mackay of Ardbrecknish, pointed out, from deciding that an MSP's salary could be reduced by as much as 99 per cent. or as little as 1 per cent. This will entirely be a matter for the parliament to determine, but we consider it is helpful to provide it with a framework.

Dual membership is more likely to be an issue during the early days of the parliament. Therefore, in order to have some provision in place from day one, the Secretary of State has commissioned the Senior Salaries Review Body to consider what an appropriate level of abatement should be until such time as the parliament can consider this issue. It is hoped that thereafter the parliament will continue to take independent advice on salary abatements.

In view of this explanation I hope that the noble Lord will withdraw his amendment.

Lord Mackay of Ardbrecknish: My Lords, it seems to me that as the Senior Salaries Review Body is to report to the Government about the initial decisions, which can only be taken by the Government because the Scottish parliament is not up and running, then surely the latter can take advice from that body when the parliament is in existence. The noble Baroness has not in the least convinced me that the Government need to have a prescription in the clause, which is drawn as vaguely as she has admitted. In truth, it does not specify anything. I think that I could make out an argument that 99.999 per cent. was "a proportion". That does not stand up.

It would be much simpler to do what I have suggested. Clause 78 would then signal clearly to the parliament that it had to deal with this matter. It could ask the Senior Salaries Review Body what to do and that would be it. We would not have this vague provision about "a particular proportion" in subsection (2). That is what annoys me above all. If there were a third subsection stating that the particular proportion should be not more than such-and-such and not less than such-and-such--in other words, outlining the parameters--I would have some sympathy with it, but when the provisions are this vague, I believe that my suggestion is far better. It leaves the matter entirely at the discretion of the parliament. In the interests of not being prescriptive, I wish to seek the opinion of the House.

28 Oct 1998 : Column 2065

12.45 a.m.

On Question, Whether the said amendment (No. 160) shall be agreed to?

Their Lordships divided: Contents, 15; Not-Contents, 53.

Division No. 5


Attlee, E.
Byford, B.
Carlisle, E.
Chesham, L.
Dixon-Smith, L.
Ellenborough, L.
Mackay of Ardbrecknish, L. [Teller.]
Mackay of Drumadoon, L.
Mackie of Benshie, L.
Mar and Kellie, E.
Montrose, D.
Rowallan, L.
Selkirk of Douglas, L.
Steel of Aikwood, L.
Strathclyde, L. [Teller.]


Acton, L.
Ahmed, L.
Alli, L.
Amos, B.
Bach, L.
Berkeley, L.
Carmichael of Kelvingrove, L.
Carter, L. [Teller.]
Chandos, V.
Clarke of Hampstead, L.
Cocks of Hartcliffe, L.
Crawley, B.
Davies of Coity, L.
Davies of Oldham, L.
Dean of Thornton-le-Fylde, B.
Desai, L.
Donoughue, L.
Falconer of Thoroton, L.
Farrington of Ribbleton, B.
Gordon of Strathblane, L.
Goudie, B.
Graham of Edmonton, L.
Grenfell, L.
Hardie, L.
Hardy of Wath, L.
Harris of Haringey, L.
Hogg of Cumbernauld, L.
Hoyle, L.
Hughes of Woodside, L.
Hunt of Kings Heath, L.
Jay of Paddington, B. [Lord Privy Seal.]
Judd, L.
Macdonald of Tradeston, L.
McIntosh of Haringey, L. [Teller.]
Mackenzie of Framwellgate, L.
Monkswell, L.
Nicol, B.
Pitkeathley, B.
Plant of Highfield, L.
Ponsonby of Shulbrede, L.
Puttnam, L.
Ramsay of Cartvale, B.
Rea, L.
Rendell of Babergh, B.
Sawyer, L.
Sewel, L.
Smith of Gilmorehill, B.
Symons of Vernham Dean, B.
Tomlinson, L.
Uddin, B.
Whitty, L.
Winston, L.
Young of Old Scone, B.

Resolved in the negative, and amendment disagreed to accordingly.

28 Oct 1998 : Column 2065

12.54 a.m.

[Amendments Nos. 161 and 162 not moved.]

Clause 82 [Scottish representation at Westminster]:

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