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Dáil Éireann debate -
Tuesday, 25 May 1965

Vol. 215 No. 14

Pensions (Abatement) Bill, 1965: Second Stage (Resumed).

Question again proposed: "That the Bill be now read a Second Time."

When the debate was adjourned last week, I was dealing with the case of abatement as it applied to ex-Army officers who are employed as teachers. The position is that because of the abatement, persons employed in that capacity are not enabled to avail of or at least are deprived of the opportunity to avail of certain perquisites which are available to other teachers, such as fees for examination papers or for supervising at public examinations. In addition, people on the Reserve of Officers are liable to have the amount payable to them for the three weeks of annual training deducted from their pensions. In fact, as I understand it, the only reason why a number of ex-officers remain in the Reserve is that the Reserve grant of £50 is not affected by the abatement.

This measure deals with a very limited number of cases. I would be interested to hear from the Minister approximately how many cases will benefit by it and what is the estimated total cost. It is proposed, though I am not sure if there is power to do so, to include ex-Army personnel by regulation but the Bill as drafted excludes them from the benefits of it and there are a number of points which many ex-Army personnel have expressed concern about.

The effect of abatement can be quite far-reaching in the cases of ex-Army personnel because, with one or two other possible exceptions, the age of retirement in respect of Army personnel is in most cases much lower than that which applies elsewhere. Depending on rank, retirement in the Army operates as a relatively early age in a number of cases. The result is that if ex-Army personnel are employed in some other capacity under the State, or indirectly by State or semi-State bodies, abatement will take place and the position therefore is that in some cases men of comparatively young ages find that if they get alternative employment, either from the State or semi-State bodies, abatement will apply.

The best way to illustrate this point is to quote particular cases. For example, at present an Army pensioner whose pension is £400 a year and whose salary, say, at the date of retirement was £1,200 a year will, if he is employed in the Civil Service and receives a salary not exceeding £800 a year, draw the whole of his pension. On the other hand, if he is in receipt of a salary from the Civil Service of £900 a year, his pension is abated to £300. In other words, the total of his Army pension and of his present salary must not exceed the salary he was receiving at the date of his retirement. Therefore, the Army pension is correspondingly abated.

There is another anomaly in that the salary payable in respect of the rank with which he retired has by now probably been increased as a result of adjustments, either on the basis of the various wage and salary round increases or perhaps on the basis of a status award. It is likely that the salary of £1,200 for the rank he held has now been raised to £1,500. This is ignored entirely and the abatement of his pension continues.

This Bill, while it appears to deal with certain anomalies, does not deal with the principle involved. The pension earned was presumably earned for service rendered in whatever rank or appointment the individual held, and the salary for the new position is also presumably given on the basis of the ability and capacity of the person so appointed being appropriate to the particular office to which he is appointed. In other words, he is qualified by experience, or whatever other qualifications are appropriate, but he then finds that, although he is personally qualified and fitted for the appointment, his pension will be abated. It seems to me that the measure as at present drafted does not cover the Defence Forces Pensions (Amendment) Scheme which was in Statutory Instrument No. 247 of 1964. I am not clear whether that particular Statutory Instrument will stand because it is not listed amongst those which the Bill proposes to repeal.

There is, however, another aspect of this matter. A number of ex-Army personnel are employed in State or semi-State bodies and because of the age at which a number of such people are employed by these bodies, it is possible they will eventually qualify for a pension, having already had the minimum period necessary to qualify for an Army pension. As I understand it, a number of pension schemes operated by these State bodies—many of which have to get the sanction of either the Minister for Finance or other Ministers—include a clause which will prevent a person qualifying for the second pension and, if he so qualifies, he will be liable to have his Army pension abated. This raises a much wider question than the mere abatement of pensions.

These State companies have benefited from, and their boards have recognised, the peculiar qualifications which many ex-Army personnel possess and which fit them for posts of leadership, management and the control of staff and, indeed, a whole range of positions which it is not necessary now to mention. In a variety of these State companies, ex-Army personnel have given not merely satisfaction but have provided the drive, leadership and initiative which was responsible in a great many cases for the success of the undertakings. If in the future these positions are to be filled by persons having similar qualifications, they should be, if not made attractive, certainly free from a penalty clause of any kind. If these people are to be induced to apply for these positions and if the skill, experience and training they received in the Army and which has fitted them for many of these positions, are not to be lost by their seeking employment elsewhere, as a number of them could readily do, it is important to ensure that no scheme or arrangement is allowed to operate which will militate against their being so induced.

The pensions earned by such people in State companies and semi-State companies are, as far as I am aware, on a contributory basis. The individual concerned will have paid contributions in respect of his pension. Therefore, it is going too far with the old approach in this matter to allow that abatement to operate. This applies even outside the State or semi-State bodies. It also applies to certain local authority positions because in some of these positions, indeed in a great many, there is involved in some way or other the possibility of a State contribution and there is considerable concern amongst ex-Army personnel to ascertain whether it is proposed simultaneously with the passing of this Bill to amend the particular clauses of the various Defence Force pension schemes because, so far as I am aware, it is possible that there is more than one scheme involved.

There is article 15, I think, of the 1937 scheme and there would certainly be the Statutory Instrument, No. 247, of the Defence Forces Pensions (Amendment) Scheme, 1964. My attention has also been drawn to a further pension scheme, article 20 of the Defence Forces Pensions (Amendment) Scheme 1953, Statutory Instrument No. 259 of 1953. This particular one, apparently, affects an ex-Army pensioner who is in receipt of a service pension and— there cannot be a great many of these cases—a disablement pension as well. He apparently suffers, according to my informant, a reduction equal to half the lesser pension. It seems, therefore, unfair because in the particular case brought to my notice the person concerned filled for many years a position of high rank in the Army and subsequently served in an important position in one of the State bodies. I should be glad, therefore, if the Minister would ensure that if provision is not included in a proposed amending order it will be possible to have it included at a later stage in the Bill because, in the Minister's speech, he said that the Bill accordingly provides that where a public service pensioner is re-employed in any employment other than that from which he retires, even though this employment is in the public service, his pension will not be abated but where he is re-employed in the same service as that from which he retires his pension would continue to be subject to abatement but of a milder kind.

I think it is no harm to mention that I have known cases where ex-Army personnel have been employed either directly or indirectly by the State and they have suffered very considerable loss of emoluments. I know one case, and I am sure there are others, where the person involved has so far suffered the loss of about £500 or £600. In fact, in a number of these cases the effect of the abatement has meant that not merely have these persons themselves not got the benefit of the ninth round but in certain cases they have not got the benefit of the seventh or eighth rounds because at some stage in the seventh round abatement applied with the result that part of the seventh and the whole of the eighth and ninth rounds passed them by.

These are matters which should be remedied. I see no reason why there should be any deviation between one category of State personnel and another. No distinction should be made between people who are civil servants and persons who are in the Garda or the Army so far as abatement arrangements apply.

In addition to these cases there are certain other cases that I should like to bring to the Minister's attention. They concern district court clerks who had many years service but not sufficient to qualify them for maximum pensions. In at least two of the cases that have been brought to my notice they were obliged, because of ill health, to retire earlier than they would have otherwise retired. As the Minister is probably aware the normal retiring age in respect of these cases is 65. Those who had national service and I think even those without it—but most of them had it—provided their health was satisfactory and their work or their capacity to fulfil the duties of their employment was satisfactory, could be continued on a year-to-year basis.

In some cases that year-to year permission was granted on the application of the individuals concerned but in at least two of these cases, and I think in another, the particular individuals became ill and, apparently, if illness exceeds 28 days during the period of the extended year, the doctor responsible, either the doctor assigned to the particular district or the chief medical officer of the Civil Service had a right to examine the person although in both of these cases the person concerned had not been aware either verbally or in writing, prior to the operation of this regulation that illness in excess of 28 days would leave him liable to forced retirement and not entitled to be re-employed.

The position in these cases is that the persons concerned had less than the 40 years' service that would give them the maximum pension. In some cases they had as much as 38 years which only left them a couple of years short. I understand the Minister has power under the Superannuation Acts to give added years. I mention these cases because the particular pension that the individuals enjoy is a low one. I have the figures here and I find that the total pension was originally £29 per month and apparently, subsequently, because of some pensions increase Act it was increased to £31 per month. I should be glad if the Minister would consider these cases and see if it is possible to give them the maximum pension to which they are entitled because I believe there is general recognition that the work they did in many cases, helping in the establishment of the whole district court procedure, involved them in very considerable work of a technical and important kind and they have rendered very satisfactory service to the State.

I should be glad if the Minister would consider those cases in conjunction with the other cases that have been mentioned, the ex-Army personnel. The present position so far as they are concerned is most unsatisfactory and, indeed, unfair and inequitable.

There are certain other aspects of this matter that might be the subject of consideration at this time except that it probably would be outside the scope of the measure. Some pensions fall to be considered because there is an over-riding maximum to which individuals are entitled and although I understand it is not specifically covered by this measure or by any measure for which the Minister has responsibility, it is the subject of a Dáil resolution and it is a matter that he might possibly consider in the near future with a view to having the necessary changes made.

I believe there is a general desire to improve the pension arrangements because of the general dissatisfaction which exists over the abatement provisions and this is a matter that from time to time has been the subject of consideration here. The first abatement was in respect of pensions awarded for military service. In future there will be possibly fewer of these cases and the number will become less because of the deaths of persons already awarded pensions. But the particular position that obtains now in respect of Army personnel is one that should be rectified, not merely in their interests, but in the interests of the State as a whole, not merely because of the peculiar qualifications which they have for subsequent State employment or semi-State employment, but in order to ensure that we attract to the Defence Forces persons of the best quality and of the highest possible calibre. If they feel that if they should secure employment of a State or semi-State character subsequently their pensions will be abated, it may lessen their enthusiasm for and interest in particular positions.

As I said initially, Army personnel retire at a much earlier age than any other category. That is involved in the type of service, and there is no escaping it, but we ought, at any rate, to make it possible for them to secure alternative employment for which their talents and qualifications fit them, without in any way making them suffer as a result. For that reason, I believe that there is a welcome for this measure in so far as it goes but it does not, so far as I understand it, cover a number of categories and, in particular, ex-Army personnel.

If there are any other categories that are not covered, we can consider them also on Committee Stage.

This Bill has been introduced because of the fact that the pensions of persons who retire from the Civil Service and are re-employed are badly affected by the existing law on the subject but I feel sure that most Deputies would not want a Bill of this sort if it were left to the views of individual Deputies. What they would ask for is that this system of pension abatement should be abolished completely because it does appear as if it were picking out certain types of individual for special treatment, for treatment which they do not deserve and which they most certainly should not have meted out to them by the State. Unfortunately, the position seems to be that this Bill, which I agree is a slight improvement on existing legislation, is being introduced for the purpose of remedying the position which has occurred as a result of the eighth and ninth rounds of wage and salary increases.

The Minister says in the last paragraph of his brief that he considered the question of making the Bill retrospective, that it was introduced last December and that it was originally intended to have it enacted in the last session and that it would be reasonable to make it retrospective to 1st January, 1965. I do not think it would be reasonable to have it enacted with retrospective effect to 1st January, 1965. I think the Minister must go back very much further. Do not forget that the people concerned are people who have given long service to the State, and because of the fact that the State has deemed it reasonable to re-employ them, the State has collected a considerable amount of money back from them.

The extraordinary thing about all this is that most of us here are thinking of a section of people who are not included in the Bill but who will be directly affected by it, that is Army officers. I do not know whether or not it is the usual thing to have a Bill framed in this way—I cannot remember what happened previously—but I am told that the idea is that, first of all, the Bill is passed and then, by regulation, the Army will decide certain things. That is the extraordinary thing about it. I have gone to a considerable amount of trouble to find out whether or not that was, in fact, the idea and I am convinced that it is true that the entire Bill is coloured by what the Army want, that is, by what those who control the Army want. That is a rather extraordinary situation. I am quite sure that the number of civil servants who retire at the normal retiring age who seek re-employment, apart from Army or Garda personnel, must be extremely small. I understand that the Army authorities are becoming rather alarmed by the number of officers who are retiring for the purpose of taking up State employment and feel that there is one way to stop them from doing that, that is, to clamp down, to make them suffer, to make them lose something.

If the Army feel that way and if the Government who, after all, control the Army, feel that way, would not the proper thing be not to re-employ them? You cannot have it both ways. You let them out, give them permission to retire; they are found to be eminently suitable for another job under the State and the State re-employs them but at the same time "has a go" at their pension in order to try to get some of its own back. The situation is ridiculous. The Minister should have a long look at this before the Bill reaches the next Stage. I believe he has got to do one thing or the other. The Government must make up their minds whether they want or do not want to re-employ persons who have been civil servants, whether as Army officers, officers of the Garda or anything else.

I must compliment Deputy Cosgrave, Leader of the Fine Gael Party, on the excellent case he made. He made it so well that I do not propose to elaborate on any of the points he put forward, but, as I said at the beginning, this is a matter on which most Deputies have definite views and they are views which are entirely contrary to the views the Front Bench of the Government Party appear to have.

I know that Army personnel normally retire from the Army service at a much earlier age than the retiring age in other employment. Again, that is something that requires a second look. It is all right to say that it creates openings for new officers coming up but it does appear as if in the prime of his life, when he knows much more about his trade than anybody else can know in 20 or 30 years, that an Army officer is sent back into civilian life. That is where the catch comes in because the State then finds that he is an excellent man to whom to give authority, an excellent man to put in control in some position for which a man with experience and a knowledge of handling men is required and he is taken on and given less pay. That is what it amounts to. He gets less pay than a civilian who has no knowledge at all and who may have had nothing like his experience.

Another matter which should be considered is the question of the rate of pay. I was rather surprised to find that in the case of persons who come from the Army, irrespective of what their service may be, they start in their new jobs almost always at the bottom of the scale. It is rather extraordinary that it should be the case that, despite the fact that they have long years of service and have proved themselves to be excellent men and men who can be trusted, they enter their new employment at the bottom of the scale. I do not know whether the Minister can do anything about it at this stage but I would seriously suggest that this matter should get further consideration from him before he goes any further with it.

I repeat that definitely 1st January, 1965, is not a suitable date for retrospection. Do not forget that not so very long ago when certain people were getting wage and salary increases, this House offered no objection to having them ante-dated to the previous April 12 months. Why should an effort be made now to remove a great deal of that retrospection in the case of a certain section of the people? That is what it means.

I am rather amused by section 2 of the Bill which repeals a provision of the Presidential Establishment Act, 1938, which makes provision for the case of a retired President if he becomes a member of the Oireachtas. Is the Minister paying the way for the return to this House of future Presidents? That would be a precedent which has not been established yet and I would be very interested in knowing if it is proposed to establish it.

The qualifying age is only 30. After two terms, 14 years, that would leave a very young man as ex-President.

Is the Minister considering lowering the age at which candidates for the Presidency are to be put forward by his Party? I know that abatement also applies to local authorities and the Minister should consider this matter very fully before it comes to the next Stage. We on this side of the House assure him of our full support if he decides to improve the Bill or, better still, if he decides to repeal the enactment entirely.

The points that I wished to raise have already been dealt with fairly fully by the last two speakers. Therefore, to avoid repetition I shall try to net one facet of the discussion for the Minister in this way. By what principle does one discriminate against the Army officer and in favour of the civil servant? As I understand the position, if the civil servant retires either as early as he can or even at the very end, he will have certain rights and the same rights are not available to the army officer. What is the distinction? I am not objecting to any benefits that are given to anyone in this but I am asking why there should be discrimination against the army officer who apparently will suffer abatement. I cannot see the logic of it.

The last speaker introduced an element of which I am not aware personally, but if it is a factor in the situation, it should certainly be looked into. Deputy Tully suggested that it was the Army authorities themselves had some say in this matter. I find it very hard to see what reason they would have but if it is the reason that Deputy Tully has suggested, namely, an inducement to keep the officer in service for the maximum term possible and a discouragement to his retiring to take up employment elsewhere—I find this hard to believe because it is a very shortsighted approach to a difficult problem—we are touching on something that more rightly appertains to the problems of the Department of Defence, how to obtain an adequate supply of suitable material for the Defence Forces. That obviously is not directly relevant to the measure before us but, as Deputy Tully has introduced the point, it is as well to ask that that point be cleared up.

It did appear to me, in the first instance, that this was a legacy of an unfortunate situation that existed between the civilian and military sides of the Department of Defence from about 1925 onwards. I fear, from my own knowledge of that period, that some kind of conflict—to use the word "feud" would be too strong and to use the word "disagreement" does not quite describe it—stemming back to that situation which apparently developed around 1925, has made the two elements in the Department of Defence suspicious of each other, and thinking of the Army officers as a different type of State servant from any other kind of State servant may have coloured the approach to this.

The time has come, in so far as remuneration, pensions and similar matters are concerned, to look fairly at all State servants and treat them equally. With regard to the payment which the State makes for services rendered to it and the pensions which are awarded when these services are completed, why should there be any difference in principle for any Departments of State? There will be different rates of pay in different services but why there should be a difference in the application of such things as abatement I have always failed to understand? It is on that matter of principle that I would ask the Minister to examine this question. Whether it be a civil servant, a Garda, an Army officer, for the beginning anyway, one feels that a common principle should rule. Whether it is a case of re-employment, after retirement, in a State service directly, in the State service in the second degree, so to speak, as in the court service or local authority service, or in a State-sponsored company, why again should the common principle not rule? Is there any reason why a man, when he has ceased his service and receives his pension, should have that pension abated in any circumstances?

Let us ask ourselves the question: why does he get that pension? Presumably the principle is that he gets no pension until he has retired in circumstances where he qualifies for a pension, and the instant at which he qualifies for that pension is the instant of retirement. He has qualified and earned, if you like to put it that way, his pension, irrespective of the contingencies of the future. So far as he and the State are concerned at that moment, he is at liberty to do nothing further, to be completely outside the State's orbit, or the State is at liberty to re-employ him. In what circumstances then should he be re-employed, if he is to be re-employed? Immediately the answer can be given that the State—and I use "State" to cover all the categories I mentioned earlier—is entitled to employ him at any scale or on any terms agreed between the parties. That is fair enough but I would ask the Minister to consider whether it is not the better principle to say: "Very good; it is a new contract and we would rather not consider that person for the contract than take him in on abated terms."

If a man is good enough for a job in the State service, in a State-sponsored body, with a local authority, or something like that, he should not be accepted as a pensioner, so to speak. Certainly the principle should not be that the job is a perquisite or relief for him. The principle should be that he is employed because he can give full service in the particular job. Presumably when he is employed, or re-employed, as the case may be, he is capable of giving the service required. We are all aware of the precautions that are taken, the public service precautions about which we boast a great deal. Generally speaking, appointments are very properly controlled through the Appointments Commission and otherwise. There is invariably free competition and it must be inferred, therefore, that the pensioner who secures the employment secures it on the basis that he is the best fitted for the particular job. If he is the best fitted why should he carry a pension with him? Why should we set limits in his case to the possible remuneration he can earn when we do not set such limits to any other type of remuneration? Why should we say "Thus far, and no further" to a particular man when we do not do it in other cases?

This particular practice is pred-judicial to the State in that people of real ability, people competent to give excellent service, will be attracted to sectors in which the State cannot abate their remuneration and only the second rate will be left available to State employment then. I do not know how such a measure would affect a very competent officer in a Department or elsewhere—I do not want to limit it to the Civil Service—who secures a senior post in some outside commercial organisation; he does not suffer any abatement of pension in that outside employment but, if he were to go into a State company, he would suffer irrespective of how great the need was for his services. In certain cases his qualifications might mean a great deal but, because of abatement, he will not go to a State or semi-State enterprise and, in that way, these bodies are deprived to some extent.

I have not examined how far this situation can occur but it certainly can occur in the case of an Army officer. That brings me back again to the question of principle. Why should one discriminate? I join with the other speakers in appealing to the Minister to consider this matter of principle. We should ask ourselves whether we have not here a continuance more of a tradition than any substantial ground for maintaining this rather invidious practice.

Lastly, in answer to the points made by Deputy Cosgrave and Deputy James Tully, it may be said that all this will be considered separately in the Department of Defence either by way of regulation or legislation. Frankly, I do not think that would be a satisfactory solution for two reasons. First—I am back once more to the principle—this is something affecting generally the remuneration and pension of State servants. I fail to see why we have to differentiate as between Departments. The second reason is that, notwithstanding the Defence Forces legislation, it always seems to happen that something occurs which was neither anticipated nor intended under legislation or under regulations. When considering the principle I should also like the Minister to consider the expediency of dealing with the whole matter here in one clean, neat measure embodying provisions that will be clear to all and that will not lead to confusion later or divergent interpretations.

I intervene for the purpose of expressing general approval of the provisions of the Bill. I intervene primarily for the purpose of getting, if possible, from the Minister an assurance that this measure is merely the forerunner of whatever instrument or step may be necessary in order to abolish entirely this practice of abatement of pensions. The practice has undoubtedly become very strongly embodied in the financial structure of the State like many of our financial arrangements and traditions and practices taken over from the British.

The Minister should be proud of the fact that he has succeeded in bringing in this Bill. I never thought I would see the day when a Minister for Finance in this State would come into this House with a measure designed to abolish, to a limited extent, this practice of abatement of pensions. This practice is not founded on any defensible principle. The only aim is to save money. There is no principle on which the practice can be defended. If a man gets a pension he gets it because he earned it and because he is legally entitled to it. Why take it from him in whole or in part if he gets other employment? If he goes into State or public authority service, presumably he will earn the money he will get in that employment. Under the practice up to this it has been the custom to extract from him, on re-employment, some of the money to which he is entitled and to which incidentally his employer is not entitled. I hope I am correctly interpreting the Minister when I say that, having read and re-read his speech, I came to the conclusion that the Minister intends by this Bill to abolish the practice of abatement where that practice is founded upon a statutory provision and that he intends likewise to abolish the practice where that practice is referable to any regulation or instrument by means of the appropriate regulation or instrument. In his opening speech he stated at column 1904 of volume 215 of the Official Report:

However, if the pensioner's services are sufficiently valuable to enable him to secure employment outside the public service, his pension is not abated. I am of the opinion that, if the pensioner can similarly obtain employment in a sector of the public service other than that from which he retired, this constitutes prima facie evidence that his services are valuable and competitive and that he should be paid in full for the job as though he had secured employment outside the public service.

That seems to me to be capable of only one interpretation: that the Minister is of the view that, if a man has a pension and is able to get remunerative work outside, why should he not get remunerative work inside the public service, if he is capable of doing the job, without any abatement of his pension? That is the principle of which I am seeking approval from the Minister and the House. I hope I am right in coming to the conclusion that the Minister accepts that and that, therefore, this Bill deals only, as he says himself in the earlier part of his speech, with the position where abatement takes place in accordance with statute, and that where abatement takes place under regulations or schemes of any kind, he will take the necessary steps to avoid it.

In an earlier part of his speech, the Minister said, at column 1903:

Where provisions for abatement in pension schemes can be amended by regulation or otherwise without recourse to legislation, they are not dealt with in this Bill, but it is intended that when the Bill has been enacted, these provisions will then be dealt with by way of statutory instrument.

That appears to suggest that however this abatement takes place, whether by regulation or scheme, it is intended to do away with it. That is what I want an assurance of the Minister's intentions on. This practice of abatement, as I have already stated—and it cannot be too often reiterated—has no principle on which it can be founded. It is a practice that grew up over the years in the British Civil Service and was taken over here by us. It is unjust. If a man earns his pension, is worth the money and gets another job subsequently, he is entitled both to the pension and to his remuneration for the work he is doing. This practice of abatement is not in accordance with the principles of justice, fair play and reward for services that have been rendered, that are being rendered and will be rendered in the future. It is indefensible for this practice to be continued.

I am rather worried by one matter that arises in the Minister's speech. Perhaps he will be able to explain it and remove my difficulty. He appears to make a distinction between the public service and the Civil Service. I imagine the practice is that, if a person has, say, a pension from the Army or the Garda and gets a position in either the Civil Service or the local authority service, abatement takes place in accordance with the statutory provisions. In the sentence that follows almost after the sentence I have referred to at column 1904, the Minister goes on to say:

On the other hand, where a pensioner is re-employed in the same service as that in which he spent his career, it may not be because his services meet the above conditions.

He had previously stated it was prima facie evidence that, if a man got a position, it was sufficiently clear he should be paid in full for the job when he had secured it outside the public service. In the first sentence he uses the words “public service” and then, later on, he speaks about “the same service” and later about a “public service pensioner”. I do not know what the difference is between a public service pensioner and the public service. Is it a distinction between the Civil Service and the public service? It is rather ambiguous, and perhaps the Minister would clear it up. I do not imagine he is going to say that, if a man takes a job in the Civil Service after retiring from the Civil Service, then his pension should abate unless there are other conditions; but if he gets a job in what is known as the public service, as distinct from the Civil Service, there is not abatement of the pension. I do not think that can be meant, but it appears to be a meaning his words are capable of being given.

I should like to join in the arguments put forward by Deputy Cosgrave that this Bill should apply to the categories and persons he detailed. Again, you come back to the fundamental thesis that the practice of abatement has no defensible principle on which it can be based and, therefore, cannot be widened in scope to attach to service in what are known as the State-sponsored bodies such as the ESB, Bord na Móna and all the others.

The practice of abatement should be abolished in every respect and for every category. If a man has earned his pension he is entitled to keep it. If he gets a job, presumably the persons giving it, whether they be the State, a local authority or one of the State-sponsored bodies, take into account the fact he is going to be worth what he is paid and is going to do that work requiring payment of the prescribed kind. He should not be in the position of the man referred to by Deputy Cosgrave. I think Deputy Cosgrave said he was a teacher. He found himself in an invidious position as regards his fellow teachers because he had a pension from the Army and could not even get the increases of pay granted to his fellow teachers as a matter of justice and right because he had this pension.

All that is entirely and utterly indefensible. I would ask the Minister for an assurance that wherever abatement is put into practice, whether it is on a statutory or other basis, whether by agreement or anything else, appropriate steps will be taken as soon as possible to abolish it in every place it is in operation.

I find myself almost in complete agreement with the previous speakers. The only criticism I would offer would be that I feel Deputy Cosgrave was possibly a little bit too gentle in his criticism of the whole situation. I find myself very much more in support of Deputy J. A. Costello in his denunciation of a practice which does not appear to have any moral justification whatever. We should remember that this whole practice dates back to 1834 in the reign of William IV. The situation of the United Kingdom Government in that year differed considerably, to put it mildly, from the condition of the present day Government, either in the Republic or in the United Kingdom.

In those days you had a comparatively small number of Government Departments. I imagine the Superannuation Act of 1834 was probably introduced to stop civil servants from the Home Office jumping into the Foreign Office and back into the Home Office again, thereby increasing their remuneration by ringing the changes in their appointments. The number of appointments that were available was very much more limited than now. At the present day we have, not only the Civil Service, as we know it, which staffs the Government Departments, but we also have a tremendous number of statutory Boards, State organisations, semi-State organisations and so on. Therefore, in the context of present day Government this whole conception of abatement of pensions is devoid of any justification whatsoever. I was encouraged, like Deputy J. A. Costello and by the Minister's opening speech but I am utterly confused when I try to relate that to the Bill itself. I do not know whether Deputy J. A. Costello is right that this is possibly the first step. If that is right I cannot, for the life of me, see why we cannot take the whole step now.

According to the Minister's opening speech, which Deputy J. A. Costello has already quoted, the Minister states that the Bill accordingly provides where a public service pensioner is re-employed in any employment other than that from which he retired, even though this employment is in the public service, his pension will not be abated. That is a categorical statement. We then refer to section 1 of the Bill. Subsection (1), (b) (i) deserves a little bit more consideration than it has got so far. I do not wonder it has not got it because, to my mind, it is completely and deliberately incomprehensible. It was not drafted to give a clear idea of anything but so far as it does give any idea it is in direct contravention of what the Minister has stated. Paragraph (b) (i) of subsection (1) refers to "no more of the allowance," that is the superannuation allowance and it states:

No more of the allowance shall be paid, for any specified period of receipt of the payment, than so much as, with the payment, equals the remuneration which the pensioner would have received in respect of that period if, during it, he——

I want to get away from the quotation for a moment and to say that there is a clear provision for abatement of pension in certain circumstances. The certain circumstances are where a person:

(I) held the office in which he served on the last day of his pensionable service, but

I would ask the House to bear with me while I read this and possibly the members might try to read it with me. Paragraph (b) (i) (II) states if a pensioner:

was remunerated at the rate of remuneration (inclusive of the money value of emoluments (being any apartments, rations or other perquisites in kind) if any), of which he was in receipt on that day, subject, however, in case changes have taken place (or, if the said office has ceased to exist, would have taken place if it had not ceased to exist) in that rate, to treating that rate as being varied by taking account of so much of those changes as may be specified.

I hope the Minister can understand that.

It is a dreadful section.

I do not know what it means or if it means anything. I have got a horrible suspicion it means nothing and that possibly the draftsman was given such complicated instructions that he just kept floundering on and it gradually became more confusing. There is a clear provision in certain circumstances that the pension in question can be abated but it is far from clear as to what the basis of that abatement may be. The Minister has stated the general principle quite clearly that if a member of the Civil Service were re-employed in the same position as he was originally employed in for hardship reasons or very valid reasons or inability to fill the position then his pension should be abated. If a man is allowed to stay on a little longer because his post cannot be filled then quite clearly he should not be entitled to additional remuneration if he accepts the offer and stays on at his basic rate of pay.

That is reasonable but, like the other speakers, I cannot see there is any justification for what is blatant discrimination against Army officers. A lot of my criticism would still apply even if Army officers were provided for under this Bill in exactly the same way as civil servants. The whole tone of the Bill seems to me to be designed to cover certain individuals only and I do not know who they are. It makes other provisions in respect of other named individuals, the President, the Attorney General and for some reason, Dr. Beddy. It is most unusual to make reference to a person in a Bill. That situation does not often arise. I do not know whether Dr. Beddy comes well or badly out of this because I would want to know the different cross references to say what the position is. He is mentioned by name in the Bill.

We are faced at the moment with the conflict between the Minister's speech and the Bill itself in so far as it is comprehensible at all. I feel, like all the other speakers, where a pension is granted to a civil servant or an Army officer it has been earned by him and therefore it must be paid. There is no question of discretion about it. If the pension is earned and if the civil servant or the officer retires, in accordance with regulations, and he is allowed to retire, and if he is then re-employed we have got to get clearly in our minds what the motive behind that person's re-employment may be.

The Bill itself makes special provision in section 1, subsection (3) where the Minister has certain discretion to waive the conditions in the earlier subsection where he is satisfied that:

(a) Persons with particular training and experience are required for particular work in a particular Department or office;

(b) the person who is being re-employed has that training and experience, is being re-employed for that work and is otherwise suitable for re-employment in all respects, and

(c) it is not practicable to meet that requirement otherwise than by the re-employment of pensioners.

Surely that is the situation at the moment. If it is not, is that an admission that State Departments are at present employing State pensioners purely for God's sake, out of charity? I would be very worried if they were. I hope and believe they are not. I do not know any cases where a State pensioner has been re-employed in another post otherwise than by reason of his supreme fittedness for his second job. Yet, in comes this subsection (3) of section I as if this were a new idea. That surely was the idea all along and it should not have to be an exceptional thing. That should be the general rule.

If it is not desirable that Government Departments or State bodies should re-employ pensioners at all, that should clearly be stated, but nobody will state that because that would be an indefensible contention from the State. If the State were to say "You served us in one capacity and, so help us, you will never do it again", it could never stand over that. But, unless the Government will say that, it will have to come back to my original contention that State pensioners are employed only when it is in the interests of the service that they should so be re-employed.

I cannot understand why there should be this difference between State and private enterprise. Supposing I, as a private employer, employ a man in a job that rates, say, £15 a week and, just before I clinch his employment, I discover that he is already entitled to £5 a week Army pension. Supposing I say: "Right; you have the job. I need pay you only £10 because you have £5 a week from the Department of Defence and so you are perfectly happy, or should be." Any employer who does that should be flung out on his ear.

He is not looking for the best man but for the cheapest.

Exactly. He should be hounded out because he is trying to get cut-price labour.

Do you suggest we should start with the Minister?

Supposing, as a private employer, I discover, after employing a man, that, while I have been giving him £15 a week, he has been getting his £5 Army pension and I come back to him and I say: "Your job rates only £15. You have been getting £20 because you have been getting £5 pension. I want a refund of that £5 a week which you have been getting in excess of the amount of money the job rates and I should be glad if you would let me know how you propose to repay the overpayment." That is not fanciful. An officer whom I know has already got that from his own Department. He was informed: "It has now been decided your pension should have been abated. You have now been overpaid. How do you propose to reimburse State funds?" How do you expect? He has not got it to reimburse. If that is indefensible from a private employer's point of view, why should it be defensible from the point of view of the State?

Why is it, for instance, that a State pensioner can go into employment with An Bord Bainne and have no pension abatement, no restriction at all, but if he goes into Bord Fáilte, he has had it? I know one person in Bord Fáilte who has suffered abatement. He has never got the eighth or ninth round wage increases and the reasons given have varied from time to time. Let us forget about the reasons. The thing is that he has never got an increase.

Under Article 12 of the 1953 pensions scheme, it was provided that total remuneration must not exceed the appropriate Army pay at the date of the determination. Then, in October, 1961, both Army pay and civilian pay were increased, leaving—in a case I have in mind—£62 per annum to be disregarded for abatement purposes. Under Article 12 of the 1953 pensions scheme, this person was later informed that "the only increases which may be disregarded are those granted to meet the cost of living .... the increase in your remuneration was an eighth round wage increase and, as such, was not a cost of living increase." So, he was down the glen again.

In January 1964 both Army and civilian pay had been increased leaving, in this man's case, an additional £83 per annum to be disregarded under Article 12 of the 1953 scheme. Then he was informed: "It has not yet been determined to what extent, if any, the ninth round of wage increases may be disregarded for abatement purposes." Then we come to October, 1964, and the Defence Forces (Pensions 18 Amendment) Scheme. Paragraph 18 amended Article 15 of the 1937 scheme so that in this man's case his maximum pay at date of retirement was increased by £29 per annum—but it also repealed Article 12 of the 1953 scheme.

This 1964 scheme has yet to be passed by the House. I hope it will not be passed because it is a craftily designed bit of legislation which appears to be granting increases all around, but, apart from anything else. it repeals Article 12 of the 1953 scheme which might have led to some amelioration of this ex-officer's whole pension.

The situation is so unutterably crazy that when this officer was given an official memorandum from the accountant's office of Bord Fáilte he was informed that his pay under the ninth round had now been increased by, I think, £1 14s. 6d per week. It gave him some ground for hope and he waited for his next pay but found that the pay cheque was exactly the same as before. On inquiry, he was informed that this was not a mistake, that it was deliberate, because, if his pay were increased by £1 14s. 6d., his Army pension would be decreased by the same amount and Bord Fáilte saw no reason to subsidise Army pensions by awarding an increase which would relieve the Department of Defence of some of its liabilities.

How crazy can you get? I can go worse than that. There are or were until recently two men working at Dublin Airport side by side in the same office, both ex-Army officers, doing precisely the same job. One was employed by the Department of Transport and Power and the other by the air company—Aer Lingus, Aer Rianta or Aerlinte. The airline employee suffered no abatement but the officer of the Department of Transport and Power suffered full abatement. The two men were doing the same job. They were being paid virtually out of the same source of money. However, because Aer Lingus is relying on money from the public and the Department of Transport and Power is financed purely out of voted moneys, we get this stupid and entirely unjustifiable discrimination between two officers who had served together in the Army, retired with the same rank and were now doing the same civilian job.

This leads inescapably to the contention of Deputy J. A. Costello that the whole business has no moral justification whatsoever and should be wiped out, if that is what the Minister really intended, and I believe that was what he intended. If we would reduce this Bill to one or two sections, there would be a deep sigh of relief and the Minister, as Minister for Finance, would not have to put another 2d on cigarettes to pay the cost.

The number of men affected by this is quite amazingly small but we have this stupid habit which I think is largely maintained by a feeling of jealousy on the part of some people and which we should abolish now and forever. We must have a situation where Army officers, in particular, are not penalised for exercising their rights. The rumour is and the belief is very firmly held that the Department of Defence will try in some way to discourage Army officers from exercising their right to retire at any time after 12 years' service, subject of course to the exigencies of the service——

I did not tell Deputy Booth and he did not tell me. That is two sources for the Minister.

There was no collusion in this and probably it does not come from the same source of information either. But there is this definite feeling, and I share it myself, and I think Deputy Tully shares it, that there is this backhanded way of restricting the rights of an Army officer to retire before serving his full time. Why not get this out into the open and say: "We will amend Army regulations; we cannot do it in this Bill, but let the Minister for Defence amend Army regulations to say that Army officers must not retire before completion of their full service"?

The State refuses to employ them, and that is the same thing.

Exactly; if the State says that, nobody will want to join the Army. It is a ludicrous situation but, even without officers trying to leave before their full time is up in order to get more money in civilian or State employment, there is often the case where an officer is blocked in his promotion. This has happened particularly with officers who received Volunteer or Emergency commissions during the Emergency period and who subsequently were accepted for Regular commissions. Those officers were definitely blocked in future promotion in spite of all the assurances given to them that that would not occur.

Quite a number of these officers got stuck at the rank of captain. They got old and grey. A few struggled up to commandant and a few got away. They could see the writing on the wall that they were not serving any useful purpose staying on in the service and consequently were more or less driven out of the Army. It was not done with lightness of heart but after deep consideration, but they were literally forced out and at that stage they were entitled to pensions and were deserving of every penny they were going to get.

Why should they be penalised? The number of jobs open to them is very limited and there is much greater scope for them in State or semi-State employment and they are much better in that sort of job. Whether it is a junior officer retiring, or a senior officer retiring on completion of service, is it right that certain officers should retire and suffer abatement and others, say, like General Costello should retire, go into the Sugar Company and hold a remunerative job there and as well get full pension? I say he deserves every penny of his pension and every penny of his salary. If he does not deserve his salary, he should be fired. It seems to me he is giving complete satisfaction to his board of directors. He is getting on, and every penny of his pension goes into his pocket. It was well earned over years of Army service and that is how it should be. There is no reason why we should go fiddling around with a Bill like this saying: "You can go into the Sugar Company or into Bord Bainne but you must not go into Bord Fáilte; you will be penalised if you go in there". There is no justification whatever for that.

This is a Bill which was on the stocks before the general election. The Minister for Finance had plenty on his plate up to now dealing with the Budget. This was handed to him. I do not want to attack the Minister. I hope that Deputy J. A. Costello is right that the Minister intends to wipe the whole thing out. I should like, after hearing comments in the House, if we could get the Bill deferred for a short period, say, three or four weeks. That would give the Minister an opportunity of really looking into it so as to see whether he wants to go on with it at all or not. I would hope he would say at this stage: "Let us make a clean sweep of it." I should like the Minister to have a look at the total cost of removing this abatement provision altogether and certainly he will find the amount, if not microscopically small, something which would not upset his Budget unduly. If we are to have any improvement of the situation so much the better, but I do not accept any reason why civil servants should be dealt with under the Bill and Army officers should be told to await the pleasure of the Minister for Defence.

This discrimination against Army officers is something which I have always resented and which I always shall until the justification for it is removed altogether. It has not been removed so far. I support very strongly all that has been said already and I add my appeal to that of Deputy J. A. Costello to the Minister, that he should very seriously consider withdrawing the Bill at this stage and re-drafting it in two sections. If there is some improvement to be made now and the Minister cannot go further, surely he should make provision to ensure that precisely the same rights will be given to ex-Army officers as are given to civil servants under the provisions of the Bill. There can be no justification for discrimination and I know in my heart of hearts, as Deputy J. A. Costello does, that if the Department of Defence get their hands on drafting regulations they will do as they have always done in the past.

I feel rather like the man trying to stop a fight who is set upon by the two combatants. I came in with a Bill which I thought was generally acceptable to the Army, removing what I describe as an anomaly in the pension scheme and certainly improving on a situation that exists. I have been listening to people on my side of the House as well as on the other side and I want to say at the outset that this has nothing to do with Army pensions. This Bill deals with pensions payable as a result of legislation as such. I often thought that the profession to which Deputy John A. Costello and I belong is about the best freemasonry in the world, but we do not seem to hold a candle as far as ex-Army people are concerned. They say: "Old soldiers never die", but I think the old soldiers in this House will die getting ex-Army officers good jobs for the rest of their retired lives. I often wondered what esprit de corps meant. Now I know—Army corps apparently.

As Deputy J. A. Costello observed, this Bill deals with public service pensions, Civil Service pensions and local authority pensions, that are payable as a result of Acts of Parliament and I can only amend Acts of Parliament with an Act of Parliament. There are many other pensions which are payable as a result of the enactment of Statutory Instruments. These include Army pensions, Garda pensions, teachers' pensions and perhaps some others. When this Bill will have passed the House, the intention will be that the appropriate Ministers bring in amendments of the various Statutory Instruments along the same lines as will have been enacted in this Bill. So there is no question of the Army being badly treated by not being mentioned in this Bill. I do not know what the Department of Defence will do with the Statutory Instrument when they get it. That is a matter for the Army itself.

As ex-Army watchdogs in this House.

Will they get a little encouragement from Finance?

They may, because I would be anxious to keep the provisions of this Bill consistent with the provisions of the Statutory Instruments when they come before this House.

If we get that, we will be happy.

As I said, this deals with the abatement of pensions. Exception has been taken to the section that continues abatement in the case of people who reach the age of retirement and continue in the same service within the Civil Service. There have been many cases in which people retained their positions for a year or two beyond the normal retirement age on the ground of hardship, and perhaps for the sake of some temporary expedient, but it is wrong that a man who has reached the age of 65 and has qualified for a pension of £600 a year but continues in his job at, say, £1,500 a year, should get the rate for the job and the pension as well. I do not think that is justifiable.

If a man retires in the ordinary way and leaves the Civil Service and takes a job in Bord Bainne, Bord Fáilte or Aer Lingus, if his services are valuable to one of the semi-State bodies, he is entitled to enjoy the rate for the job and the full rate of the pension he has earned. I put service within the Civil Service in the same category as service in any other employment in which a person pays a certain rate per week or per annum on his salary towards his superannuation. In the Civil Service it is a notional payment because, I take it, the salary is adjusted having regard to the person's obligation to the superannuation fund. He has earned his pension and therefore, if he leaves the Civil Service and takes up another job within the public service, he is entitled to whatever rate the job can give.

Having done that, I do not think I should go further. I do not think I should settle the new contract of his employment. That is a matter between him and whoever offers him employment. I do not think it would be right or proper for me to say here and now that if Aer Lingus or any other company employ a man who enjoys a pension within the Civil Service or the Army, they must pay him at a certain rate. A man who has spent his life in the Army or the Civil Service should be able to look after himself. He should be able to make his contract and make sure that the terms of the contract are satisfactory. Therefore, I do not think it is a matter for me, as some Deputies seem to have suggested, to lay down in some way the terms of his re-employment. I do not think I should do so, and I have no intention of doing so.

Do the Department of Finance in any way indicate in their pension scheme where there are to be abatements?

It is a general principle that has been in operation.

Does it not mean that the ESB, or the other company, fix the remuneration, and the Department of Finance say: "We will not grant it any more?"

It is as easy as that.

I am saying that a man may get another job if he wants it, but fixing his rate of remuneration is his own business.

But the Department will take his pension from him.

No, they will not.

In that case what does subsection (2) of section 1 mean?

If a man reaches the age of 65 and if he stays in the same employment, he may be on a salary of £1,000 per annum with a pension of £400. His pension then is completely abated. Assuming in a year's time that the rate for the job went up from £1,000 to £1,200, his notional salary would be £1,200. I am trying to interpret the jargon which Deputy Booth was reading out. This Bill is called the Pensions (Abatement) Bill but its title should be the Pensions (Abolition of Abatement) Bill. Unfortunately the title seems to have set the theme for some of the speeches on Second Stage. Subject to that single instance, abatement in public service pensions is being done away with so far as pensions payable under Acts of Parliament are concerned. Pensions payable under Statutory Instruments will follow the same pattern in due course.

Can the Minister say will it be followed in identical terms?

This will have to be changed by the appropriate Ministers and brought to the House. It will then be a matter for the House to ensure that the best terms are included when the Statutory Instruments are before the House.

Before they come to the House, they will be referred to the Minister for sanction. Will the Minister ensure that they comply with this Bill?

If I can read them as well as Deputy Booth, and understand them, I will do my best to ensure that the same principles apply. Deputy J. A. Costello referred to the district court clerks but they are outside the scope of this Bill and I do not think I can deal specifically with the cases he mentioned. Those are the only remarks I think I need make. I do not intend asking the House for all Stages today and I hope to answer any other questions on Committee Stage.

Question put and agreed to.
Committee Stage ordered for Wednesday 2nd June, 1965.

Will we not have the Finance Bill?

The Finance Bill will will not be ready until the middle of the month. It will be circulated earlier.

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