- Quote
- I congratulate the right hon. Member for East Hampshire (Mr. Mates) on obtaining the time for this debate, and the hon. Member for Newark (Patrick Mercer) on coming to the Chamber to speak in support of the Bill. I also pay tribute to his distinguished service in the armed forces. I know that he takes a great deal of interest in the welfare not only of the armed forces but of their families and, sadly, widows as well—of which, of course, we have had a number in recent years, in addition to those from earlier conflicts. I pay tribute to Mrs. Jenny Green of the War Widows Association, who will be known to many Members of this House. She has done sterling work on behalf of war widows, and will be stepping down some time this year. She has taken a great interest in war widows’ issues and has been a forceful character in pursuing them. Let me first give a general picture, so that a number of points are on the record. I hope that the House will bear with me. The Government of course value greatly the work and commitment of the individuals who have served in our armed forces over the years; in that regard, we need only look at the outstanding and courageous work that our people are doing in Iraq today. Of course, these individuals have received all the benefits that were considered appropriate at the time, and that were part of their terms and conditions of service when they served. It is a long-standing principle that, where changes are made to the benefits of public service pension schemes, they are implemented from a current date for future service only and are not made retrospective. There are of course a number of legacy issues, including those relating to widows’ and widowers’ benefits, that have arisen as a result of Government economic policies and improvements that were made in the past—mostly in the late 1970s—to the armed forces pension scheme 75, known as AFPS 75, that did not cover those who served before the changes were made. It is in this context that I want to address the three key legacy issues relating to the Bill. On pensions for life, following a change of policy in 2000, widows and widowers whose spouses died for reasons associated with service life have been able to retain their pensions on remarriage or cohabitation. However, the change was extended only to those individuals who had not already remarried or cohabited; it was not made retrospective. The change made in 2000 was exceptional and for a very special group of war widows; it was not extended to widows or widowers whose spouses had died for reasons unrelated to service. The one-off cost of buying back the liability to restore the attributable pensions of those who remarried before the change would be about £40 million. The future cost of providing pensions for life for non-attributable widows and widowers would be £14 million a year, with retrospective costs of £460 million for the armed forces scheme, and of some £3 billion if applied to the rest of the public sector. On post-retirement marriages, the Social Security Act 1975 required occupational pension schemes to introduce pensions for widows who married their husbands after they had retired from the service. Provision was made in AFPS 75 to comply with the Act, but only widows whose husbands gave service after April 1978 benefited, and only service after that date was used when calculating the level of pension. For widowers, the change was not introduced until April 1989, and then only for service from that date. The one-off cost of extending the entitlement to all current and deferred AFPS pensioners is estimated at £50 million; the cost across all public service schemes would of course be much greater. On the one-third rate and half-rate changes, until 1973 the widow of a retired serviceman was entitled to a pension equal to one third of that of her late husband. As a result of the Social Security Act 1973, this was increased to one half from April 1973, but only for service from that date. An opportunity was given to serving personnel to make direct contributions in order to buy in former service at the half rate. It would cost up to £30 million a year to change all pre-1973 armed forces widows’ pensions to half rate, and the cost across all public service schemes would of course be much greater. I should add that, having given the option for members of the armed forces serving on or after 31 March 1973 to buy in their previous service if they wished, it would be unfair to extend the half-rate pension to widows whose husbands had not contributed financially towards the improvement. Naturally, many issues associated with widows’ pensions and forces pensions in general revolve around the retrospection policy that Governments have continuously stuck to over the years. The Government are of course very aware of the strength of the feeling among ex-service personnel and dependants who have not benefited from improvements to pension provision. However, legal principles dictate that members’ entitlements are generally calculated according to pension rules in force at the date of their retirement. It is a policy principle of public service pensions, upheld by successive Governments, that improvements to pension schemes are not made retrospective. I ask the hon. Member for Newark to take into account the fact that the AFPS 75 legacy issues do not affect only the armed forces, but are common to all public service schemes. Where legacy issues are common across public sector schemes, a retrospective change implemented for the armed forces would certainly result in pressure from others for similar treatment. To concede retrospection to one group would place great pressure on other public sector— It being half-past Two o’clock, the debate stood adjourned. Debate to be resumed on Friday 22 February.
- Time
- 14:24
Patrick Mercer (Newark) (Con)Independent
Annette Brooke (Mid-Dorset and North Poole) (LD)Liberal Democrat
Andrew Selous (South-West Bedfordshire) (Con)Conservative