Skip to main content
Normal View

Dáil Éireann debate -
Friday, 7 Nov 1947

Vol. 108 No. 11

Committee on Finance. - Superannuation Bill, 1947—Money Resolution.

I move:—

That it is expedient to authorise such payments out of moneys provided by the Oireachtas as are necessary to give effect to any Act of the present Session to amend and extend certain enactments relating to superannuation.

I want again to plead with the Minister not to close the door against a claim by those who retired prior to 1940 for an increase in the inadequate scales of pension allowed to them. So far as this Bill is concerned, every person superannuated since 1943 will, as from that year, have his pension related to a cost-of-living index figure of 170 and future pensioners, unless there is an inordinate swing up or down in the cost-of-living index figure, will have their pensions related to the same index figure. Therefore, the State will have two main classes of pensioner— one, those whose pensions will be related to an index figure of 170——

Is it not 270?

I am taking 1914 as nought. The figure 170 is technically better known in the Civil Service than 270. They will have their pensions related to an index figure of 170 if they retired since 1943 and retire at any future date, whereas there will be others, those pensioned before 1923, whose pensions will be related to an index figure varying from, say, 50 to 165. That latter class of pensioner, whose pensions are based on index figures swinging between 50 and 165, will tend to be a disappearing class. For instance, those whose pensions are related to an index figure of 50 are those who retired about 1932. Those who retired in that year under the age limit of 65 years, are now 15 years over 65 and are on the border of 80 years of age. Those who retired subsequent to 1932 and who retired on pensions related to an index figure something higher than 50 but lower than 170 are also advancing in years. Those who retired between 1932 and 1943 will tend to be a dwindling class and will be replaced by a new type of pensioners whose pensions will be more or less standardised, if present circumstances continue, on an index figure of 170. The Minister must know that if a person retires on a pension related to an index figure of 50 points over the 1914 level of prices and who is compelled to live in circumstances in which the cost-of-living index figure is 219 over the 1914 level of prices, he is not getting a pension adequate to the circumstances or sufficient to maintain him in the altered circumstances. If a person retires on a pension related to an index figure of 50, it is assumed that the pension is adequate to maintain him when the level of prices is 50 per cent. over the 1914 level; but quite clearly a pension which might be contended to be reasonable in relation to price levels 50 per cent. over 1914 and related to that 50 per cent. increase, cannot be held to be adequate compensation where you precipitate the pensioner into a condition of life in which he has to try to make ends meet at a time when the index figure is 219 over the 1914 level.

I said on the last occasion—and I think the accuracy cannot be challenged, if one adverts to the facts— that practically every country in Europe I know of has been compelled to increase pre-war pensions. In Britain, of which the Minister was so fond for debating purposes this morning, and in the Six Counties, pensions have been increased, born of a recognition of the fact that it is unfair to ask persons to try to subsist in existing circumstances on their low, preemergency rates of pension. Increases have been granted to State pensioners and municipal pensioners there, notwithstanding the fact that the British cost-of-living index figure shows an increase of only 33 per cent. on the 1939 level, whereas our cost of living has increased by 84 per cent. on the 1939 level. The British nevertheless recognised the necessity for increasing pensions there and the Six-County Government has done the same. Yet so far the Minister has shown no appreciation whatever of the difficulties of those who retired prior to 1940 and whose position is certainly a very bad one where they were in receipt of low salaries during their period of employment in the State service and who have received no compensation for the increase in prices since 1939.

The Minister may contend that it is not possible for the Exchequer to meet this charge. The charge, according to the Minister's figures, would be a trifling one and a dwindling one; and there is no insuperable difficulty whatever in the Minister being able to find the necessary money. It seems extraordinary that the claims made by such persons have convinced Governments all over Europe, but we remain absolutely obdurate.

I plead with the Minister again that he ought to examine the matter sympathetically and, if he is not prepared to recognise the general principle of a claim for increased pensions, at least he might make some special effort to give an increase to those who retired on very low rates and who are in a desperate plight to-day. Most of them gave at least 40 years' service to the State, many of them more. The least the State ought to do is to recognise the value of the service they gave and to try, especially as the cost is not inordinately high, to relieve them by granting a percentage increase on pre-emergency pensions. It will not cost much and there will be widespread support for the proposal, as the Minister is being pressed, even by his own Party, to recognise the justice of this claim.

I would like to repeat what I said on the Second Reading and to add my voice to that of Deputy Norton on behalf of those pensioners who retired in 1940 and whose plight is very serious indeed. The arguments in favour of bringing them within the scope of this measure have been fully put on the Second Reading and it is not necessary to repeat them. In the course of his reply then, the Minister was asked what it would cost to equate the position of pre-1940 pensioners with that of those who retired between 1940 and 1946 and he said he was not in a position to give the figures. I do not know if he is now able to do so. Deputy Norton has said the amount is trifling. At all events, it is not so large that the Exchequer cannot afford to meet it, when justice requires that the claim should be met. It has been judicially decided that the bonus is not so much additional remuneration or emoluments as something intended to equate salary with actual conditions having regard to the cost-of-living figure.

The Minister puts, as the only argument he was able to put in answer to the arguments put up on the Second Reading, that the contract of these men did not permit of or require the adjustment of their pensions when the cost of living soared. The Minister said in his reply, as given in column 1214 of the Official Debates, Volume 108:—

"There never was anything in a civil servant's contract or a teacher's contract that the pension he would draw at the end of his days would be sufficient to keep him at any particular standard of life."

The fallacy of that argument is perfectly apparent. The fact that it was the only argument that the Minister was able to advance shows the weakness of his case. There is no real argument against the justice of the demands put forward by these people. They served normally 40 years of their lives in the Civil Service. The pension is really a deferred pay and at the time when these people entered into their contracts or quasi-contracts in the public service, £1 was able to purchase a pound's worth of goods. Conditions have varied since that time and that basic salary which they got was admitted, by the introduction of the cost-of-living bonus system, to be entirely out of relation to the facts. The very introduction of the bonus system destroys any possible force there is in the Minister's argument. They never bargained, when they entered the service, to get a bonus, but they got the bonus. How can the Minister say that, because they never again bargained to get a bonus on their pension when the cost of living increased, they should be deprived of it?

Deputy Norton has pointed out that the class of people affected is a very small and dwindling one. Many of them are probably over 70 and some are getting on for 75 and 80 years of age and they are all having a very tough and strenuous time. When the cost of living fell it meant a fall in their pensions level, so it is only just in equity that when it rises the pension should rise accordingly. It is no answer to say that their contract did not provide for that matter. The very fact that the salaries of other public servants has been increased, although there was no contract—in fact, it was against their contract that those salaries have been increased—clearly destroys the very tenuous basis of the arguments on which the Minister rests. All Parties in the House are in favour of an increase. It will not impose any great burden on the Exchequer and whatever the burden is it will be a dwindling one. The claim is one that justice requires and that all Parties should support.

I did not get an opportunity, unfortunately, of speaking on the Second Reading of this Bill and so I avail of this occasion to add my voice to the pleas made on behalf of these people by the Deputies who spoke on the Second Reading and those who have already spoken to-day.

The Deputy will bear in mind that this is not a Second Reading debate.

I will. I want to say that I think the injustice of the Minister's attitude on this matter is quite impossible. All Civil Service pensions have been held judicially, I think, to be deferred payments. If they are, in effect, deferred payments then no argument can be put forward by the Minister, from the financial point of view, that these people have not a right to increased pay, because what we are giving them in the form of a pension is, in effect, a payment for past services, a payment which is to be continued during their retirement. If those in the Civil Service to-day, and those who retired later than 1940, have been given what I prefer to call increased payment, then the plea which is being made on behalf of those who retired prior to 1940 is, in justice and equity, unanswerable. I should like to hear from the Minister what the cost of doing that would be. I consider that, no matter how high the figure may be, in justice we should do it. I am sorry that an Irish Government should take a niggardly attitude towards people who served the State so faithfully and so well during many years of their lives.

I wish to endorse everything that has been said by Deputy Costello and Deputy Dockrell, and I appeal very earnestly to the Minister to reconsider this matter. The people who may be affected are old and feeble. They have lived a sheltered existence because most State servants and public officials do look upon their position as one of security and safety. When starting out on their career one of the things they search for is security. These civil servants, especially in their old age, are particularly weak and defenceless, and are unable to make their voices heard. They are people who have devoted a lifetime of service to the State, and I suggest that in this era the example that a good employer should give.

We all know that the cost of living has more than doubled. These people in their old age must find it nearly impossible to live on the very small allowances they get. I think it would be an act of good faith and an act of Christianity to bring their pensions, in the last few years of their lives, up to a level that would enable them to live in reasonable comfort. Social security can be achieved only by providing wages, salaries and pensions at such a level as will enable people to acquire the essentials of life. Since this Bill was introduced the Minister for Industry and Commerce, I think, has quite properly endorsed the suggestion that wages should be based on the cost of living. I respectfully suggest that is the only way in which you can avoid industrial strife—that wages should be related to the cost of living. Likewise, in the case of these old people I suggest that the Minister for Finance should reconsider their position. In doing so he will have the support of every Party in the House. I do not think it would cost very much. He has not indicated how much it would cost, but I think he should reconsider the matter away from political issues.

The Minister, in moving the Money Resolution, gave the House no information as to the sum that would be required for this. It seems rather extraordinary that the House should be treated in that manner. Deputy Norton, who has some knowledge of this problem, suggested that the amount that would be required to meet the case of those people on whose behalf Deputies are pleading, would be trifling. I think the Minister should reconsider the matter, and I want to join with other Deputies in asking him to do so. After all, it is a matter of justice. In many cases it is a matter of extreme urgency that some adjustment should be made so as to enable those people, who have given long service to the State, to live in some degree of comfort in their declining years.

As regards the lower grades, I can assure the Minister that the conditions, so far as those people are concerned, are appalling. I know a number of them myself. Deputies have been approached to try to get something done for them. The Minister stated that there was no demand for this. He must know that every decent-minded citizen would support the plea for a favourable adjustment for those who retired prior to 1940 as well as for those who retired between 1940 and 1943. The Minister is making a discrimination as between those who retired between 1940 and 1943 and those who retired at a later date. He has made no case whatever for such a discrimination, and he has made no attempt to reply to the case made for those who retired prior to 1940. The only argument that is left to him is that there was a contract and that he has honoured that contract. I think Deputy Costello has answered him effectively on that. I want to say that, according to that contract, if the cost of living goes down the pensioner is obliged under the contract to take reduction in his pension, but if the cost of living goes above the over-riding maximum he cannot benefit, and, accordingly, has to suffer a loss all the time. That is scarcely a fair contract in present circumstances, especially when one remembers that the contract was made on the basis of an altogether different standard of living from that which we have to-day. One would scarcely expect that the Minister would come into Parliament and base his arguments merely on an obsolete contract, obsolete so far as the conditions that obtain to-day are concerned. I would expect that he would be more concerned with the justice of the claim. I think the claim is reasonable.

As I said before, we should consider the struggle that people on low pensions have to make to exist, the difficulty of securing clothes when they want them, the shame of having to appear in public in a shabby condition and perhaps hide it under an overcoat. Then the men who enjoyed a fair salary in the past and who retired formed friendships and associations which they cannot afford to have to-day with a low income. The good position that they had at that time has to be forgotten and they have to break associations that they had in the past because they cannot afford to have them any longer. If in our circumstances here we cannot afford to do justice to that class, our circumstances are surely bad. If the Minister wants the approval of the public for this demand, it is there for him.

The Minister merely says that the State never guaranteed that a pension would keep a man for the rest of his life. If a man gives the best years of his life to a State service and makes some contribution during that period to provide him with a pension, particularly the man on a low salary who could not make provision for the rainy day and for his declining years, what does the Minister suggest should be done about it? Surely we all have respect for the people who spent the best years of their lives working hard in the interest of the State and they are entitled to retire in comfort and should not have any worries.

Might I remind the Deputy that this is not a Second Reading debate? The Deputy has a good idea as to what a Money Resolution is for.

We were not even told.

I do not think anybody has asked very much about it, if I might make the remark. A certain number of questions are allowed, but it should not be a Second Reading debate.

I am sure it is not your intention, Sir, to prevent me any more than any other Deputy?

I have said what I intended to say. I think the House is entitled at least to some information on this resolution and I hope the Minister will give us that information, particularly as to what it would cost to finance what Deputies have suggested should be met.

I only intervene briefly in this debate for the purpose of depriving the Minister of the only conceivable line of argument which he could adopt against the appeal which has been made to him by all the Deputies who have spoken. The Minister may contend that when these civil servants who retired prior to 1940 were making their contracts of service they were assured of a certain yearly income whether the value of money went up or down, whether the cost of living increased or decreased. He may say that if the cost of living had decreased and the value of money was higher to-day than it was when these people entered the service, then they would be gaining a substantial advantage and no attempt would be made by the State to deprive them of that advantage. That argument might be suitable if we were dealing with pre-1914 conditions.

For 100 years prior to 1914 there were periods of prosperity and periods of depression, periods when the value of money was high and periods when it was low, and these occurred in regular cycles. Since 1914, there has been a complete world revolution. The entire cost of living has changed completely; it has increased enormously. The value of money has declined to an extraordinary extent. There have been two world wars which have upset the whole position that prevailed prior to 1914. I think the Minister cannot argue on the basis that these people might have benefited if the cost of living had gone down. There is no comparison between what happened to the cost of living since 1914 and what happened in regular cycles during the previous 100 years. Civil servants and those who have contracts of service have been affected by this world revolution in the value of money. The extraordinary situation which has developed since then requires very special consideration. Therefore I think that the Minister ought to listen to the appeals made to him and he ought to ensure that a grave injustice will not be inflicted upon a very weak and numerically small section of the community.

The Minister's statement, that there was nothing in a civil servant's or teacher's contract which provided that the pension he would draw at the end of his service would be sufficient to maintain a certain standard of life, is a very cynical attitude towards the problem we are discussing. I do not know whether there was ever a contract in the strict sense of the word. I was a civil servant for a short period and I have no recollection of ever signing a contract or any kind of legal undertaking which could be interpreted as a contract. But, even admitting for the sake of argument that the Minister's statement is correct, what is the situation? These people entered into this contract at a time when the pound was really worth a pound and they never envisaged that conditions would arise in which the value of the pound would be reduced to half or less than half. If, as the Minister states, there has been a contract, I submit that the Minister is bound by the terms of the contract to equate the pensions of these people to the conditions under which they entered the service.

The fact that the Minister introduced this Bill shows that he is prepared to make provision for the people who retired after 1940 so as to ensure that their standard of life should be maintained. But he is meting out different treatment to those who retired prior to 1940. After all, civil servants belong to a sheltered profession and the community expects them to live according to certain standards. In fact, I would say that Deputies and members of the Government expect civil servants to live according to certain standards, and, furthermore, they expect them to maintain these standards even when they retire on pension. This Bill, according to my interpretation, means that the Minister and the community generally want civil servants who retired since 1940 to live according to the standards on which they lived during the period when they were in the service. I cannot understand the Minister's attitude because it is utterly inconsistent, and that is proved by the fact that he is meting out a certain treatment to one section and a completely different treatment to another section. We know perfectly well that civil servants who retired prior to 1940 find themselves in very poor circumstances to-day. Take the case of an ex-civil servant who occupied a key position and who retired on a salary of £700 or £800.

The Deputy is now making a Second Reading speech.

I want to deal very briefly with this point. He was retired on a pension of £350 or £400 but to-day that is worth only £175 or £200. Surely to goodness it is not possible for that type of man to live in circumstances anyway comparable with those which he enjoyed during the time he was in the service? I submit that there is a moral obligation on the Ministers and members of the House to see that some reasonable provision is made for those ex-civil servants who are suffering hardship to-day and I wish to add my voice to those of other Deputies in asking that some special consideration should be given to claims of these people. I suggest that the dictates of even ordinary humanity demand that their case should be examined and that some provision should be made for them, if not in this Bill, in some other piece of legislation.

I join with other Deputies in asking the Minister to give favourable consideration to the claims of ex-civil servants who retired prior to 1940. It is obvious that the high cost of living—or perhaps I should say the cost of existing, for it is merely an existence, in their case—presses more heavily on them than on other sections of the community. Those who retired from 1930 onwards when salaries were small received relatively small allowances and they are suffering great hardships. I see no gesture on the part of the Minister in this or any measure to give them any consideration. We should bear in mind what happened in the days gone by when a certain number of civil servants, who could have retired in 1922 and who would be to-day in enjoyment of certain rights from the British Government if they had done so, contracted to remain on in the service of the Irish Government. Some of these men had retired before 1940 and now find themselves in very straitened circumstances. I think that is rather unfortunate. I would say that it is tantamount to the breaking of a contract as these people were guaranteed that they would be treated on not less favourable terms than had they remained in the British service. I do know that the Government has something in mind to try under some other measure to take from those civil servants who are still serving and who have certain rights under the Act of 1922——

Not under this Bill.

Not under this Bill, I agree. I bow to your ruling but it will do no harm at least to draw attention to the fact that those servants who remained on in the service of the Irish Government were promised that they would not be retired on pension on less favourable terms than those who went out under the 1922 Act. There are rumours of legislation to take from these——

The Deputy has already been told that that matter is out of order and he should not repeat it.

I shall leave it then to the Minister. I know that he would have the backing of every member of his own Party, if they were free to say so, in dealing justly with those ex-civil servants whose cases have been referred to. They have said privately to myself and others, that they would like to see the old pensioners dealt with generously. Frankly, I do not like the word pensioner. I say that these people who retired merely drew from the Government something to which they contributed handsomely themselves. It was really giving them some of their deferred pay after many years of faithful service. I shall not enumerate the various types of individual affected. In talking about civil servants one is inclined to mix up civil servants proper with various other types of Government employees, but they are all deserving of the Minister's attention. They were all promised that they would get the sympathy of their own national Government which they had served so well when they retired on reaching the age limit. In some cases they received very nice letters of congratulation for the services they had rendered, but letters do not buy bacon or eggs at the price which they are going to-day. I would put it to the Minister that he will have the support of every section of the House—unfortunately there is a very small attendance in the House at the moment—in giving favourable consideration to ex-civil servants who retired prior to 1940. I put it to him that he has a chance of expressing in a practical way his appreciation of these men who served the country so well.

I should like to join in the appeal made by Deputy Norton and other Deputies to the Minister to give favourable consideration to the claims of civil servants who retired prior to 1940. These men have to live on pensions which are entirely inadequate to cover the present cost of living and in my opinion they have equal rights with those who retired subsequent to 1940. I am sure it would not cost the Exchequer very much to put them on the same basis as regards pensions. It must be remembered that there are very few of those who retired prior to 1940 now living. I would ask the Minister to give sympathetic consideration to the claims of those who still survive.

The Minister to conclude, on that portion of the debate.

Subject to our right to ask him some questions.

I know the Deputy appreciates what is permitted under the rules of order. On the Second Stage of a Bill a Deputy may ask questions in regard to certain matters that are not in the Bill. Deputies did so and the Minister made certain advances. Some Deputies took the opportunity of this discussion to reply to the Minister's statement. Certain concessions were granted but the proceedings now cannot develop into a debate outside the scope of the Bill as read a Second Time.

This Bill is going to cost the taxpayers an additional £24,000 for pensions, and, in lump sum adjustments, £143,000. Deputy Hughes has got very generous in a couple of hours. He was not so generous in offering me assistance to-day to provide concessions for the generality of the community by reducing the price of sugar, tea and bread.

Is this on the Bill?

Is not that exactly what it amounts to? Deputies ask me to do certain things and when I ask them to provide me with money to enable me to do these things they say "No". Am I going to get it out of the air?

It is the way you go about it that we complain of.

Again, will Deputy Norton, Deputy Hughes or Deputy Roddy tell me the things I am to tax in order to get these additional sums for the civil servants who retired before 1940? That is a different matter. But they ask me to do this. Everybody is sympathetic with the classes who are on fixed incomes, the amount of which was fixed before 1940—the classes who have suffered a decrease in the value of their money owing to the increase in the cost of living. But there is no rabbit that I can pull out of a hat that will increase production so as to enable the whole community to live at the pre-1940 standard; that cannot be done until our production goes up to the 1939 or the 1940 level. Deputies are asking me to guarantee for a small section, who had no contract for such a guarantee, and at the cost of the rest of the community, that their £1 will always be worth its value at the date of their retirement. There is only one way in which we can do that, and that is, to keep the volume of production up to that level and distribute it in the same way.

I dealt with this thing very fully on the Second Reading and I do not intend to go into it again. It could not be dealt with as a single issue. Civil servants who retired prior to 1940—all pensioners, excluding old age and blind pensioners—are already costing the State £2,400,000 a year. I think that in the present circumstances we should be very slow to add to the bill that the people have to pay for pensioners of all types.

How much would the Minister have to pay?

I could not say off-hand. I am saying that State pensioners, excluding old age and blind pensioners, are costing £2,400,000.

Would it be possible for the Minister to make an approximate estimate?

We are doing our best to facilitate the Minister, but he seems disposed to-day to be unreasonably irritable.

I am not.

The Minister may be of that opinion, but it is the fact. The Minister cannot see his way to increase the pensions of persons who retired prior to 1940 until production comes up to a certain level. That is the Minister's viewpoint. If that is so, why did he come in recently without a request from anybody and propose increased allowances for Ministers, Deputies, judges and various other people? If the Minister takes that stand, why not offer some increase to the unfortunate people who are endeavouring to live on £2 or £3 a week?

The Deputy will not be allowed to pursue that line.

Very well; I will have the Minister on the hustings shortly.

We will meet you there.

Question agreed to.

Money Resolution reported and agreed to.

Top
Share