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Lord Lucas: My Lords, I suspect that the Minister will be able to satisfy me quite quickly as to what Amendment No. 538G does. Again, it is not obvious from the wording that this is merely confined to consequentials. It appears that the MPA is to be given a seat among the good and the great. Perhaps the Minister can explain whether that is purely consequential or whether it is a new additional decision. Indeed, there may be other aspects of the amendment that I have failed to understand. I should also like to point out that Amendment No. 538F is in no way consequential; it merely corrects a mistake made by draftsmen which I am delighted to see they have picked up. In fact, it has nothing to do with any of the other amendments.

Lord Bassam of Brighton: My Lords, as before, I am grateful to the noble Lord for his dedication to detail. I can confirm that this is a consequential removal of the reference to the age limit. I trust that that provides the noble Lord with a satisfactory response.

Lord Lucas: My Lords, this cannot be anything to do with the age limit. Indeed, Amendment No. 538G has nothing to do with the age limit. I hope that the Minister will take a quick look at his Marshalled List and assure me that all this relates to the bringing into

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existence of the MPA and its taking a seat at some unspecified table, which will now consist of four rather than three members.

Lord Bassam of Brighton: My Lords, as I said, the grouping deals with age limits. As I understand it, this amendment deals with membership.

Lord Cope of Berkeley: My Lords, can the Minister say what Amendment No. 538G seeks to achieve?

Lord Bassam of Brighton: My Lords, it is consequential upon the Home Secretary's removal as the police authority for London. Therefore, it is consistent in that regard. The amendment ensures that one MPA assembly member can sit on the boards of the NCS and NCIS. I trust that that answers the noble Lord's point.

On Question, amendments agreed to.

Lord Dixon-Smith moved Amendment No. 538K:

After Clause 286, insert the following new clause--


(" . The Mayor and the Assembly shall, by 2030, reconstitute the pension scheme of the London Fire Brigade moving it from the present unfunded scheme to a fully funded pension scheme.").

The noble Lord said: My Lords, after the complexities of the police, the fire service would seem to be relatively simple. I apologise for bringing back this particular amendment at this stage, but I have done so in order to press the Minister a little harder on the issue of the fire service pensions.

For anyone who is in the fire service, the security of his or her future pension is a matter of great significance; and, indeed, for anyone who is about to enter the service it is equally a matter of great significance. However, in both those instances, the time-scale of consideration goes considerably beyond the time-scale which politicians are normally invited to consider as being significant. In particular, the pensions consideration of someone at the age of 25, while looking into the possibility of receiving a pension at the age of 60, is dramatically outwith the normal five-year time-scale that politicians are wont to consider, especially in the other place.

The fortunate situation that this country is in vis-a-vis its national pension liabilities arises in large part because a great proportion of pension liability is covered by funded schemes. In this instance, we have a particular service--the fire service--which does not have such a scheme. The Minister assured us in Committee that the Government should, and only "should", continue to cover the long-term costs of the fire pension scheme.

The Government have a review in place. It would be interesting to hear from the Minister something about the time-scale which they envisage before this matter is brought to a conclusion. It has been around for a very long time, and I do not deny the difficulty surrounding the problem. I accept that it is somewhat difficult in a Bill vis-a-vis London to deal with a matter which has national implications because, as the Minister said, it

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would not perhaps be proper to approach the matter exclusively on London's behalf. However, if we were to deal with the matter on London's behalf and resolve it, that would create a catalyst and I believe that the Government would then be obliged to act to deal with the national problem as well. Therefore I do not wholly accept the argument that we should not deal with the issue.

However, the real purpose of bringing the measure back was to press the Minister a little harder on the Government's view of the possibility of a solution to this matter arising. No one who has had direct experience of the present situation, particularly in a local authority context, but even as regards the fire service generally, can possibly be satisfied with the existing situation. I accept that the problem has been around for a considerable time. The longer it goes on, the worse it gets and the more difficult it is to find an acceptable solution. I would be grateful to hear that at least we have some prospect of a conclusion in a reasonable political timescale, in other words, in the next two, three, four or five years. I accept that as a reasonable timescale for dealing with a matter of this significance. However, even that kind of timescale is beyond the normal range of timescales which politicians consider to be significant. I beg to move.

5.30 p.m.

Lord Renton: My Lords, I am almost persuaded by my noble friend's argument in broad terms but I am rather surprised that he has chosen the year 2030 which, after all, is 30 years' time, before this reconstituted pension scheme shall come into force. I remember once that a Labour prime minister said that a week was a long time in politics.

Lord Tope: My Lords, if the Government were to resolve this problem next week I am sure that we would be as grateful as we would be surprised. The noble Lord, Lord Dixon-Smith, apologised for bringing back this amendment. I assure him that no apologies are necessary. I am grateful to him for bringing back the amendment. I hope that he succeeds in what I think is his real objective; namely, to seek greater clarification from the Government on their intentions in dealing with what he rightly describes as a major and growing problem.

The unfunded pension schemes for the London fire service, and I think all fire services, are a considerable problem now. There is no question but that that impinges already on the operational ability of the fire service and as the problem grows, that problem too will grow. The problem is of such magnitude that only government action can deal with it. I do not know whether the amendment proposed here is necessarily the right way to tackle it--I suspect that perhaps it is not--but I wholly support what I think are the real intentions of the noble Lord, Lord Dixon-Smith, in moving it.

I also agree with his view that although this is a nation-wide problem there is no reason that we should not take this opportunity in a London Bill to let London take the lead in this matter. As London has

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the biggest fire service I imagine that it has the biggest problem in this regard. The Government have already set that precedent in removing the age discrimination for membership of the Police Authority. I accept that that provision has rather fewer financial implications than the matter we are discussing, but nevertheless the principle has been established; namely, the Government have taken the legislative opportunity that is now before us to allow London to lead the way where they intend that the rest of the country should follow. I hope that the Minister in his reply will acknowledge that there is a major problem which requires government action to resolve; that he will tell us how and when that government action is to be taken, and that he will perhaps tell us that the opportunity presented by this Bill will enable us to tackle the problem first in London as regards the London fire service.

Lord Bassam of Brighton: My Lords, this problem seems to follow me round. I recall that as an official I had to deal with fire service pensions. Therefore it is not altogether unfamiliar territory.

The Opposition amendment seeks to change the firefighters' pension scheme from its present unfunded basis to a fully funded scheme during the course of the next 30 years. As this is the length of service which a firefighter needs for a full pension, presumably the intention would be to start future new entrants in a funded scheme so that there would be a gradual transition to full funding over that period.

The firefighters' pension scheme is a national scheme which is set out in an order made under the Fire Services Act 1947. The Government cannot accept changes which affect one fire brigade but not others. On the question of consistency, the Government are proposing a minor technical amendment to legislation affecting fire service pensions. In order for public service pensions increase legislation to apply pension awards payable by the LFEPA in the same way as it does to the current fire authority, a minor amendment is required to the Pensions (Increase) Act 1971. Schedule 2 to the 1971 Act lists various types of pensions which are "official pensions" for the purposes of that Act. The present fire authority comes within the definition of a local authority for the purposes of the 1971 Act, and the proposed amendment will ensure that the LFEPA is treated in the same way.

Turning to the Opposition amendment, we recognise that there is concern about rising pensions costs. The firefighters' pension scheme in common with a number in the public service does not have a pensions fund. One of the main purposes of pension funds--to protect employees' pension rights--does not arise as the benefits are guaranteed by statute. The Government have recognised the extra pensions costs for fire authorities in recent local government finance settlements and in the Comprehensive Spending Review by including additional amounts for pensions in the fire share of total standard spending. In addition, a pension factor is included in the grant

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distribution formula. The value of this factor has been adjusted to take account of trends in pensions expenditure. The distribution to individual brigades is based on projections by the Government Actuary's Department of each brigade's relative share of the overall pensions expenditure.

A change to "new entrant" funding would not provide an easy solution to the fire authority's concerns about rising pensions costs. In fact over the next few years it would be likely to make matters worse. The authority would still carry the costs of existing pensions and of the new retirements for those pensioned under the existing scheme. But it would start to lose income from the employee contributions (11 per cent. of pay) from new entrants. These would have to go into the fund.

A review of the provisions of the FPS was published as a consultation document last year. Ministers have been considering the position in the light of the responses. The Government have recently announced (as of 14th October) an independent inquiry into the future arrangements for determining firefighters' conditions of service, but have made it clear that there will be no changes to firefighters' pensions while the inquiry is sitting.

I hope that, having registered their concerns, the noble Lord will now withdraw the amendment. I commend the government amendment.

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