Vol. 86 No. 4
I move amendment No. 1:—
Section 1. In page 2, after line 36, to add the following words "references to superannuation benefits payable to or receivable by a person or to which a person is entitled shall be construed as including superannuation benefits payable to the personal representative of such person".
This is purely a drafting amendment, required for clarification purposes and makes no change of significance.
Amendments Nos. 2 and 4 seem to go together.
There are distinct points at issue.
I think amendment No. 7 is governed by amendment No. 2.
Amendment No. 4 raises a different point. I move amendment No. 2:—
In sub-section (1), page 2, line 40, to delete the word "continuous" and substitute therefor the word "aggregate".
Amendment No. 2 relates to the conditions under which pensions will be paid and amendment No. 4 relates to the period which will be counted for pensions. As far as the section itself goes, it means that a person would not qualify as a whole-time member of the board for anything in the nature of a pension until he had given ten years' continuous whole-time membership. The other point is, what years of service will be taken into account? I am moving to take out ten years' "continuous" service, and to take it that a man qualifies for a pension when he has put in ten years' service. I mentioned on the Second Reading that there is a special point in this in regard to one whole-time member who is at present serving, but whose term of office was interrupted for one or one-and-a-half years. That person has to start now from the date of the second appointment. I suggest that that is not proper. When the break was made, it was abnormal, and the fact of his reappointment shows that it was considered that his services were useful to the board. Apart from that, I think the Bill should not be drafted round an individual.
I suggest that there is no equity in having in the Bill ten years' continuous membership. The situation is that there was no fixed scheme for the personnel of the Electricity Supply Board. A board might be set up that might appeal to a certain Minister, who might want to have on it a man with a certain business outlook or with certain experience, but another Minister might require to have someone on the technical side appointed to whole-time membership. A man who was appointed to whole-time membership might not be reappointed because another Minister had a different viewpoint as to how the board should be constituted. If that Minister or a colleague made a change, a man who had served five years could be relegated to the technical staff or relegated to part-time membership.
I suggest that where changes are brought about, not by lack of ability or lack of attention to duties, it is rather hard on a man to be subject to varying whims, seeing that it is only after passing the qualifying test he could put in a term of office amounting to ten years' continuous membership. It is better to get away from that. The particular situation is well known to Deputies. As a matter of principle, I suggest that if a man has ten years' service as a member, whether it is continuous or whether there is a break, that that should be taken as a period qualifying for a pension. If that is not the situation there might be difficulty in getting people to serve on the board. Again, we should not think of present people. Some Minister hereafter will have to look for a managing director and whole-time personnel. It will not be always the case that men put on the board will be found suitable. If a Minister hereafter has to approach an elderly person to serve on the board, and if that person sees that he must have two terms of office, one running after the other, before he can qualify for pension, that may affect a Minister in his choice of personnel.
With regard to the member of the present board who is personally affected by the form of the section, I do not think there is any case at all. I refer to the member of the board whose appointment to the board was terminated but who was appointed again after a lapse of 18 months or some such period. When his first appointment was terminated he received a lump sum of £2,000 as compensation, by way of gratuity, for the termination of his appointment. If we are now going to provide pensions for retired members, of the Electricity Supply Board we must take into account any such payments made previously in respect of a break in service in the past. This matter is complicated by the fact that there is an individual affected by the wording of the section as it stands. If we try to consider the question, not in relation to a particular individual, but in relation to the general position, I think it will be agreed that the provision made in the section is reasonable in all the circumstances. Members of the Electricity Supply Board are not badly paid; they are well paid. To make provision for pensions on retiring after a certain period of service is, in effect, to provide an increase in their salaries. It is, perhaps, questionable whether certain members of the present board or those who may come up for appointment to membership of the board in future could, or could not, earn in any other capacity higher salaries than they are now receiving. If we keep these salaries on the present scale I have not the slightest doubt we will be able to attract to the board personnel suitable to the requirements of the office. If we consider it justifiable to make provision for pensions in certain circumstances it is because those who may become members of the board and who remain members for a long period will lose commercial contacts which, otherwise, would, on retirement, procure fresh employment for them.
We have acted upon the assumption that nobody is likely to be appointed a member of the board except a person fairly advanced in years. That is, a person who has already made good in some technical or administrative post in some commercial organisation or in the public service, a person who, after a period of ten years' continuous service, would be of such an age and in such a position that suitable employment would not be likely to be available for him if he should then cease to be a member of the board. I think that it is reasonable to require that there should be a period of ten years' continuous service. I admit that there is a slight possibility that some individual may serve a nine-year term, may then have a break of a few years, be reappointed and serve another period of nine years, then ceasing to be a member of the board without being eligible for a pension. If I were to agree to modification of this section in any way, it would be only to the extent of allowing aggregation of service where each period of service was protracted. That would not meet the case to which reference has been made, nor do I think that we should attempt to deal with any past case. Any modification of the section so as to permit of aggregation of service should apply only to future members of the board or, at least, should exclude from consideration past service, prior to a break, in respect of the termination of which compensation by way of a gratuity has been already given.
My feeling is that it is not unreasonable to require ten years' continuous service to qualify for a pension. Having regard to the provision made in respect of other public offices, what the justice of the case requires and taking into consideration the rate of remuneration paid to members of the board, I should be very slow to amend this section at all. I intimated on Second Reading that some consideration might be given to the question of modifying the section. I do not say that I have come to any conclusion on this matter or that I have secured the assent of my colleagues. But, if there is to be any amendment, the farthest I should be prepared to go, assuming the Government would be prepared to amend the section, would be to recommend that aggregation of service would be permitted only if each period of service before and after the break was not less than five years and the total period of service was in excess of ten years. In such cases, I should think it fair to take into account whether, in respect of the termination of any previous service, compensation in the way of gratuity had been paid.
Any change in this section will be welcome. There are a couple of points which I should like to put to the Minister. He spoke as if the salary of the members were fixed by an Act of the Oireachtas. The salary is changeable at the end of the term of office. He spoke as if a five-year period were assured to every member of the board, whereas the Act provides for a period "not exceeding five years". Some other Government may take the view, on appointments falling due, that they will appoint I members for three years at £1,000 a year. If this provision stands, the Minister will then have the situation that a person who has served three times will have to serve one further period before he will get ten years' continuity. I thought the Minister's view with regard to salaries had changed from what it was when he was speaking from these benches. I thought he had learned that money has not the value he set upon it when he was in opposition, and that he would have brought that viewpoint to bear on this matter. The salary of the ordinary member of the board is about £1,700; the chairman gets more. A person who qualifies by having ten years' service will get about £35 in respect of each year. He will, therefore, have a pension of about £350. That man, who has given ten years' service, will have been appointed fairly late in life. He will have lost his business contacts and does the Minister think that a person with commercial contacts will give ten years at £1,700 a year to this service and, at the end of that period, receive a pension of £350? That is a lesser view of the commercial possibilities and prospects in this country than I thought the Minister would have.
The Minister weakens his argument by insisting so much on the position of the member of the board of whom we have spoken. He says that he got a gratuity of £2,000. How many more persons, on leaving office, are going to get £2,000? If they do not get £2,000, the whole strength of the Minister's case in respect of this man is gone. They will go out at the end of five years with nothing. Take the case of a man who is appointed for five years at £1,500 a year and who is dropped at the end of five years. The Minister finds, for instance, that he requires a technical man on the board and he gets a technical man. Another Minister, when the appointment falls due, may think that there are too many technical men on the board. He may want a commercial man. He puts on a commercial man and he "drops" the technical man, who has given good service for five years and in respect of whom there has been no complaint. He has not qualified for a pension and he gets nothing. Some time later, he is invited back to the board. He serves for five years and he is "dropped" once more. Still he is not eligible for a pension. I think that that is a hardship.
I am prepared to consider an amendment to the section along the lines I have indicated. If there is to be aggregation, of service, it should be in respect only of long periods. A man going in for six months or so should not qualify for a pension in respect of that period.
How many terms of six months would he have to serve before he would attain ten years?
I think that there is a case for aggregation in respect of the future where there is protracted service.
If a man goes out after six months, I take it that it will be by resolution of the House. I assume that nobody is going to make six months the ordinary term of appointment. When speaking of six months, the Minister is speaking of a man who is removed by resolution of the House. He is not thinking of a person appointed whole-time member of the board for half-yearly periods.
They are appointed for yearly periods at present but that was primarily done to synchronise the appointments.
I move amendment No. 3:—
In sub-section (1), page 2, to delete all words from the words "either after" in line 43 to the words "that age" in line 44, inclusive.
The qualification for pension depends, so far as this section is concerned, not merely on a ten-year period of service but on two alternatives—that the man must be "dropped", so to speak, or, alternatively, that he has resigned after he has attained 60 years of age or on account of ill-health before attaining that age. Suppose a person is tempted into some other service, does the Minister want to penalise that type of person? Suppose a member is a very eminent man, that he has given good service to the board and that some other organisation—for instance, a public utility organisation under Government control—comes along and asks him to take a position under that organisation. If he leaves the service of the board simply because he wants to better himself, the Minister will not allow him to qualify for a pension at all.
Certainly not.
Why not?
If there is any purpose at all in having a pensions scheme for the members of the board, it is to retain, for the service of the board, persons who are worth retaining: to give them that additional advantage from remaining in the service of the board for a period of not less than ten years, or until they are 60 years of age, in order to qualify for a pension. If we were to allow a person who had reached the position where he could obtain the maximum pension under this provision to retire without consulting the convenience of the Government, or the welfare of the organisation at all, I think we would be acting in an unduly liberal way. We do say that if he reaches the age of 60, then he may retire, or if he is in bad health he may retire, but if he is in good health, and under 60 years of age, we certainly think he should retire only in circumstances in which he knows that his retirement will involve the loss of his pension rights.
An individual may see a wider field of opportunity offered to him than that which the board offers, and what is contemplated here is that, although that is so, he must stand back and remain in the service of the board.
We cannot bid against every opportunity of that kind that may present itself to an individual.
The pivotal words in this are: "it shall be lawful for the board". It is not being made obligatory on the board. If the phrases proposed to be deleted are removed, it does not mean that the board must grant a pension. We only remove an obstacle in their path. There are two smaller points—ill-health and the 60 years. I do not think ill-health is wide enough to cover the case of a man who, say, meets with a disable ment. Suppose he is knocked down. That person may be described by a doctor as being in good health, but yet he is disabled. I do not think "ill-health" would cover a case of that kind.
As regards the other point, take the case of a man whose office is abolished. Suppose the Minister in charge indicates tliat he is going to drop a man who has a seat on the board. He has to go elsewhere while his term of office is still running. He may want to retire voluntarily. Why should not an obligation be put on the board to consider his case and pay him if the circumstances seem to warrant it?
That would be unduly liberal. A person accepts a warrant of appointment for a specified number of years and should be required to give that service at least before qualifying for a pension.
If a man is required for another service, I think he should be allowed that. In any event he will only get so many 40/80ths of whatever service he has given, and will not get that unless he has done a ten years' aggregate.
I regard this pension scheme as a provision for old age or ill-health in the case of members of the board who have given long service. I do not regard it as an increase in their remuneration because, in all the circumstances, I think they are well remunerated for the work they are doing. It is not necessary to increase their remuneration, but it is desirable, I think, that we should make provision for their old-age or ill-health if they have given long service.
Speaking of long service, there was a payment of £2,000 by the board to a person who was recently appointed by the Minister to a second job. I think he has got more than the chairman of the board for this.
That is true.
Suppose he wanted to give up his service with the board in order to go to a second appointment and that the Minister wanted him to remain, then he would have to bargain with the Minister in order to equate his loss.
He would have to make a personal bargain.
I think this should be better thought out.
I move amendment No. 4:—
In sub-section (1), page 2, line 48, to delete the word "continuous".
This applies after getting over the qualifying period for continuous service, and it deals with the years that are reckonable for pension purposes. Again, it is only continuous service that counts. A man will get over the first part of the clause because he will have done ten years' service. In that time he will, in fact, have done thirteen odd years in the service of the board. Nevertheless, when he comes to reckon his years for pensionable purposes he has to knock off the three earlier years which were, perhaps, the three most difficult in the whole period of his service. Take the case of a person who had gone on to the board, dropped off and came back again. He served, say, ten years in the second period. He had ten years of continuity. He previously served for five, dropped another five, and then had ten years' service. Only the ten, however, will be reckoned for pension purposes. I think there is a great hardship there because, in fact, that person had in all 15 years' service with the board. I think, once a man has got over the regulation fence of ten years' continuous service, that all his years of service under the board should reckon for pension purposes.
Is not that being done?
No. In the example that I have taken where a man served for five years, dropped five and gave ten years' continuous service, he only gets 10/48ths insteads of 15/48ths. He does not count the first five years.
Taking into account the possibility of compensation for the termination of appointments having been made in respect of an earlier period of service, I think there is a case for the aggregation of service for the purpose of calculating the pension where the total service exceeds ten. I am prepared to consider that point.
Very good.
I move amendment No. 5:—
In sub-section (1), page 2, line 50, to delete the word "twenty" and substitute the words "thirty-two".
The maximum that a whole-time member of the board may reach is 20/48ths or 5/12ths. The ordinary provision in most Superannuation Bills, is, I understand, 3/4ths. I do not see any good reason for cutting that out and making this exceptional change for the worse in connection with an exceptional service.
The basis of pension in the scheme was arrived at by way of a compromise between the different conflicting views held by the board, by myself and by the Minister for Finance. The Minister for Finance must necessarily enter into the picture because he is concerned with the provision made for public servants, and any precedent established in organisations such as this will naturally react upon the public service. The basis, however, proposed here of 1/48th salary for each year of service is, in fact, 25 per cent. higher than the normal Civil Service scales. It was agreed that the basis of calculation should be 25 per cent. higher than in the case of the Civil Service because of the fact that the age of entry into the board's service is likely to be late as compared with the age for entry into the public service, as well as by the imposition of this maximum of 20/48ths which is less than half salary. I do not think that, in all the circumstances, it is an unfair provision to make, having regard to the standards that we must preserve, standards already in practice in respect of senior civil servants and of officers in commercial organisations of a somewhat similar character. It may be that, in some cases, very heavy pensions are being paid. I do not think that the organisations paying them have escaped criticism. In a matter of this kind where the Government is responsible for the legislation, where, the organisation is so intimately associated with the Government, and where there has been a deliberate attempt to associate scales of salaries, methods of recruitment and of remuneration to the practice of the Civil Service, I do not think that we should leave out of account at all, what is the position of civil servants in respect to pension.
We have agreed to operate upon a 25 per cent. higher basis, that is, 1/48th of salary for each year of pension, because of the fact that the maximum will be 20/48ths, and also because of the fact, to which I have already referred, that the age of entry into membership of the board is likely to be late as compared with the age of entry into the Civil Service. I am afraid I could not at all agree to this amendment suggested by Deputy McGilligan.
Apart from the pensions that are paid to judicial people in this country—and they certainly run to two-thirds—there was an Act passed in this House in 1925, the Local Government Act, 1925, in which there are two clauses that deal with pensionable officers and salaries. In certain circumstances the local body shall pay an annual allowance for life not greater than two-thirds of his yearly salary and emoluments.
But in respect of a much longer period of service.
Take sub-section (2) Section 44:—
A local body shall, with the consent of the Minister, grant to a pensionable officer in their employment who has at least ten years' service, and
(a) who is removed from his office for a cause other than misconduct or incapacity, or
(b) whose office is abolished, or
(c) whose position has, in the opinion of the Minister, been materially altered....
an annual allowance for his life not greater than two-thirds of his yearly salary and emoluments.
There is the ten years. Two-thirds is what is required there. Of course, it is quite clear no question of finance arises on this at all because the number of people who will at any time be getting pensions as whole-time members of the board, paid out of the earnings of the board, will be relatively small. The difference between, allowing a man to rise to a maximum of two-thirds or getting this five-twelfths maximum is infinitesimal and would not cause the electricity consumers of the country to lose a night's sleep.
The number is likely to be as great as the number of heads of departments likely to be on pension at any time.
Take employees of local authorities. Their number is likely to be much bigger than any body. They are going to be paid out of the rates. I have not heard very much criticism of the pension provisions for them.
In preparing this pension scheme for members of the board, the pensions of the Civil Service have to be taken into account. I think it would be open to serious question if we were to make for retired members of the board more generous provision than is being made for senior officers of the public service and, clearly, the Minister for Finance would feel, if that is done, that his position in maintaining the existing provision for the Civil Service would be considerably weakened. The provision is in one respect already more generous than that provided for the public service. As I have said, the basis of the whole scheme was arrived at by way of compromise, and I am afraid I cannot agree to amend it here. It would reopen the whole question of the pensions of these members if I tried to secure an agreement upon a new basis.
The Minister equates this to the Civil Service. Why should it be so? The Minister recognises that to get the proper type of person to be a whole-time member, he must be a specialist. If you do not get a specialist, you will get some man with all-round abilities of a very marked type. I certainly think they would be people who would be marked under the phrase that is used in the Civil Service in respect of some persons—"possessing qualities not ordinarily found in the service". I do not see why there should be any comparison—certainly there is no identification—as between these and the members of the Civil Service. There is the other point. Civil Service pensions are not openly on a contributory basis.
These pensions are not contributory.
Those of members of the board are not; the rest of them are. They are not on a contributory basis whatever. Those who have gone into the Civil Service went in—of course they have been disappointed in this—on the basis that their salary was to fluctuate according to cost of living. There is no such provision made with regard to these people. Quite a number of things mark out the Civil Service as being completely different, especially from the four or five people we are speaking of here. I cannot see any reason whatever for equating the maximum. I think it will be found on examination of the statutes as a whole that the two-thirds maximum is far more common as a maximum than anything else. Anything other than two-thirds is the exception.
I move amendment No. 6:—
In sub-section (3), page 3, to delete all words from the words "the sum" in line 13 to the words "falls short of" in line 14, inclusive.
This is a small point. It means that if a person who has qualified for pension dies soon after he has qualified, then if the amount of the pension for the period from the date of the cesser to the date of his death is less than his yearly salary, the pension will be made up to the yearly salary. I suggest that you should simply pay him his yearly salary. If he has got a little bit in the way of pension, leave it so.
It is easy enough for Deputies to urge more generous provisions and it is not always easy to resist that plea, but we have to try to be reasonable. The Bill provides that if a man dies in harness the personal representative gets a year's salary. If he is retired on pension and dies within the first year of his retirement then the amount of the pension already paid will be supplemented so as to secure for the personal representative the balance to bring it to a year's salary. Deputy McGilligan's amendment would involve that if a person dies towards the end of the year, if in fact three-fourths or seven-eighths of the full year's pension has been paid, nevertheless, on death, a full year's salary would be paid. I think that is unduly generous in all the circumstances, having regard to the existing practice of other commercial organisations and to the public service which I think we must take into account as our standard in this regard. We do provide for this year's salary to the personal representative if the individual dies in harness. If he dies immediately after retirement then the personal representative will be paid a year's salary less the amount of pension already paid. I think that is generous enough in all the circumstances.
The Minister introduced a phrase which I do not think is in the section: "a person dying within the year". The person may die after two years. Supposing he had a pension of £300 and had a salary of £1,700 and dies three years after retirement, surely the personal representative would then get the balance?
Quite. A year's salary is paid anyway. That is quite true.
Between the date of cesser and the date of his death, at any time if he has not achieved the whole of a yearly salary, the personal representative will get as much as will make it up. It is not a question of a year.
No.
I move amendment No. 8:—
In paragraph (a), page 4, line 25, before the word "employed" to insert the words "at any time" and before the word "are" to insert the words "were or".
Amendments Nos. 8 and 9 are really the same. This section asks the board to prepare a scheme. It divides the scheme into two, one for the manual workers and the second for those who are not manual workers, but both are tied to persons employed by the board. I take it that the run of that phrase means that the scheme can only apply to people who are in the employment of the board at the time the scheme is confirmed.
No, or who may come into the service.
It will not refer to the past. There have been certain people in the employment of the board who have left that employment. It would be a very easy matter to arrange for them. It would mean that they would have to go through the bookkeeping matter of making a contribution. I suggest that it ought to be done. There are not more than half-a-dozen people involved. The point of the amendment is to allow the scheme to apply to people who have been in the service of the board.
And have already left. How can they be brought in?
Supposing a girl left to get married, or supposing a man left because he was in bad health, he or she will have to come inside the requirements of the scheme in regard to the number of years' service before any pension is payable, and so on. The board is almost 15 years in existence. There are a number of people who put in at least ten years' service and have gone. Why should not they be brought in retrospectively? It will not mean very much to them. It will mean that they would have to qualify by making payments, if that section is adhered to, or in some way or another they would have to be brought inside the scheme by the terms of the scheme itself. I should imagine that in the scheme there will probably be some minimum period of years' service before qualification and there will be contributions payable by the persons concerned. What I ask is that you ante-date this scheme as if it had been brought in during the first or second year of the board.
I have no idea of what is involved. Most persons who left the service, apart from women clerical workers who left to get married, would have left because they were dismissed for some good reason or because of bad health; that is, apart from those transferred from public authorities, who had probably pension rights attaching to them in any event. In the case of those retired in bad health, so far as I can recollect, it has been the practice of the board to make fairly generous provision for them on retirement. I should like to inquire into it and see what is involved. Personally I cannot see how we can devise an arrangement under which we can bring into the fund—I want the Deputy to think of a fund in connection with this —persons who cannot in any circumstances make a contribution to the fund.
In a later section you are allowing persons to make a contribution for past services if they are still in the service.
I will look into the point. I must be satisfied that there is a substantial number of such persons and real grievances to be remedied.
I put it the other way, that because there will be very few it can be done.
I suppose that is another point of view.
On the section, there is just this point. Those schemes that are to be prepared are to be divided into a scheme for the manual workers and a scheme for the non-manual workers. I presume some provision will be made for the possibility of a person passing from one class to another?
I presume so.
Is it clear it can be done?
I will look into the point. I presume the scheme to be prepared by the board will provide for them.
I move amendment No. 10:—
In sub-section (2), page 4, to delete all words from and including the word "either" in line 38 to the end of the sub-section, and to substitute the words "confirm such scheme".
This is to cut out a number of words in sub-section (2). As the section runs, the board prepares a scheme. That scheme is then submitted to the Minister. As the section stands, the Minister then can refer such scheme back to the board for reconsideration or, by order made after consultation with the Minister for Finance, he may confirm the scheme either without modification or with such modifications as the Minister shall, after such consultation, think proper. In other words, the board is given the task of preparing a scheme. Once it comes before the Minister, the Minister can either send it back or get into consultation and so modify it, or he can take it and modify it himself and can confirm it as if it were the board's scheme.
That is true. There must be consultation with the board.
It is not here.
Yes.
The only consultation is with the Minister for Finance. It is possible under this to refer it back for reconsideration by the board, but it is also possible for the Minister to get into consultation with the Minister for Finance and modify the board's scheme and then confirm it as the board's scheme. I suggest that that should be left out.
We must have a means of bringing to an end any deadlock that may arise. I am aware that Deputies hold different views as to the justification of having the board's scheme submitted for confirmation at all. But, if there is submission for confirmation, and the possibility of a dispute as to the particular provisions of it, somebody must have the power in the last resort to say: "My word holds good and that scheme will come into operation in the form I indicate." It is proposed that the person shall be the Minister, after this resubmission, to the board and consultation with the Minister for Finance. Otherwise, you can have a situation arising in which, by mere failure to arrive at agreement, no scheme could ever be confirmed or ever come into operation. I think we must provide some means here.
You can keep referring it back.
That means that in the last resort there will be no agreement unless the board are prepared to accept the particular points. It is much better to have the power to say in default of agreement: "Because you are not prepared to do what I suggest, we will bring the scheme into operation with the modifications which are considered necessary in the public interest." The Minister in this regard, of course, is acting as an official of the State and his sole object is to ensure that the public interest point of view is applied to the scheme prepared by the board and, in the light of the circumstances which I explained before, the possibility of the scheme prepared by this board being taken as a precedent for other public utility companies.
You know that is a bogey.
I do not think so.
There is no substance in it.
Having spent a number of years trying to evolve a pensions scheme for the Great Southern Railways Company, I am sure it is not a bogey. One of the reasons I was not at all anxious to have this Electricity Supply Board pensions scheme introduced before the Great Southern Railways pensions scheme came into operation was because I knew that the financial circumstances of the board would permit of more generous treatment than is possible in the other case and that the precedent established here would be quoted in the other case and will, I am certain, be quoted if that pensions scheme contemplated by the Railways Act, 1933, ever comes to the point of being brought into existence. In any event, we feel that there are good grounds of public policy for ensuring that the pensions provision made for employees of the Electricity Supply Board should be related to the general circumstances of, say, industrial concerns and should not be unduly generous. We must not set too high a standard in this case merely because of the exceptional circumstances of the board, as the board can charge more for electricity, and there is no possibility of people declining to pay or transferring custom to another concern. It is the exceptionally strong position occupied by the board which requires that we should examine whatever pensions scheme they propose to adopt.
If I might take an analogy from more recent circumstances, there are other industrial firms in this country which, in present circumstances, are in an equally strong position in the sale of goods and they have come to the Prices Branch of the Department with proposals to increase the salaries of their staffs and workers. They proposed to compensate themselves for that increase by an increase in the price of their goods. In such cases, the attitude taken was that any increase given must be at the expense of the proprietors and that it must not be reflected in any increased charge to the public. In the case of the Electricity Supply Board, we cannot have the same provision, but we can ensure that the person whose duty it is to protect the public interest and to examine the pension scheme the board proposes, authorises and approves of it before it is actually brought into operation. I think we must have these safeguards where an organisation like the Electricity Supply Board is concerned.
This question of a public standard is brought in to cloud the issue. There is no question of safeguarding the public purse in this matter. I do not think there is even a question of safeguarding the public purse indirectly. I think the analogy given is, therefore, altogether false, and I say the public issue can be left out altogether. There is no question of the Minister for Finance acting as guardian of the public purse, as there is no public purse to guard.
The Minister for Finance is charged with the supervision and control of the public services of the State, and he wants to ensure that, in this particular organisation, which is fairly closely related to the public service, there is not established a standard of remuneration or pension which will be an embarrassment to the Minister for Finance in dealing with the public service. I do not think the employees of the Electricity Supply Board render better service than the employees, say, of the Department of Finance or any other Government Department to an extent which would justify them getting better pensions than public officials of equal standing in any Government Department would get. It is the job of the Minister for Finance to see——
The Minister is comparing an engineer's position with that of a civil servant.
There are engineers in the Civil Service too.
The Minister tries to draw an analogy between the position of these employees and those in the service of the State, who have every security and who, in addition, had, or thought they had, an arrangement whereby they would be compensated for any increase in the cost of living. He compares their position with the case of men in the service of the board who can be dismissed at a moment's notice. The Minister for Finance is, forsooth, brought into this to protect the public interest, but there is no public interest to guard except in the long tedious way the Minister has tried to bring it in. As to the comparison that is likely to be made, the Minister fears a comparison between the conditions of the Great Southern Railways employees and the conditions enjoyed by these men, but I cannot at all credit that these comparisons of a better type are going to be pressed on the Minister when anything is brought in dealing with other types of employees. For instance, I have never heard people claim that they should get the same wages that people who were employed in Guinness's got.
On this very Bill, I heard it stated that an electrician should get the same wages as a plumber.
I think he should get more.
But in fact he does not get as much.
The Minister is endeavouring to get the impact of the Civil Service brought to bear on this question of pensions, but with regard to salaries, the board can create the most awful complications for the Minister by giving high salary rates and the Minister apparently is not perturbed over that. The Minister for Finance was not brought in to regulate that question although these people are paying £750,000 a year in salaries. I have never heard any representations that the salaries they are paying are creating an upward tendency amongst general wage-earners. but when it comes to pensions, this all important matter of pensions, we have to get this whole business moulded in the way in which it is in this Bill, simply because there may be, at some indefinite date, some tremendous comparison, whether just or not we cannot say, with some unnamed public utility that may hereafter arise and which may claim the same rate of pensions as the board wants to give to these people. I think it would be plainer to say that the Minister may prepare a scheme than to pretend that the board can prepare a scheme when the Minister can upset that scheme as he wishes afterwards.
In practice, it will be only where it is clearly justified from the point of public interest, that there will be any interference.
Surely that suggestion of the Minister is not quite justified? Does he not know from experience that, irrespective of the merits of any particular case, the object of the Department of Finance always is to prevent the creation of any precedent that might be inimical to some future action of theirs? The one bogey of the Establishment Branch of the Department of Finance is the creation of a precedent, entirely irrespective of the merits of the case. I think the Minister will agree with me that the Establishment Branch of the Department never consider the merits of any case. The first thing they consider is: "Will this create a precedent?" The black hand of the Department of Finance is sticking out in this section. I think Deputy Davin has put his finger on the difference between the employees of the board and other civil servants, even professional employees, of the State. The employees of the board are doing a far different job, a job of a highly specialised type demanding a high degree of skill. Very often human life depends on the proper performance of their duties, not to talk of the very existence of the industries of the State, and of the maintenance of lighting, cooking, etc. There are employees of the Electricity Supply Board who have no counterpart in the Civil Service. They are highly specialised men who require to be highly skilled if life itself is not to be jeopardised and if proper security and proper provision for the maintenance of public services is not to be imperilled. I think the Minister will agree with me that there is no justification for this section except that ineradicable hatred of the Establishment Branch of the Department of Finance for the creation of a precedent and the question of precedent has no relation to the question of merits.
I could not agree that there are not in the Civil Service men who in their particular branches are not as highly qualified or as eminent as similar officials in the Electricity Supply Board.
I did not say a word about qualifications or eminence, but I said they were doing a different job.
There are specialised people in the Civil Service who were attracted into the public service by reason of the security offered in that service but who, if they took a chance in professional life, might command very much higher remuneration than the public service gives them. They took less plus the security which the service offered them.
The Electricity Supply Board had to offer such conditions as would attract specialised men.
In relation to the classes of professional men employed in the board's service, the rate of remuneration plus security which they are offering has been considered quite attractive by the persons concerned. It can even be said that they are too attractive and are tending to bring into the specialised branch of work, for which the board is responsible, persons who might be more usefully left free. As to the other point made by Deputy Costello, if his experience of the Department of Finance is as he says, he will appreciate the difficulty I had in arriving at the financial provisions in the Bill, which do in fact represent a compromise arrived at in discussions between the representatives of the Department of Finance, the Electricity Supply Board and the Department of Industry and Commerce. There was not unanimity as to what should be in the Bill, and what in fact emerged represents a compromise between conflicting views, but there is nothing in the Bill which I am not going to defend as reasonable, and I do not think it is entirely unreasonable in all the circumstances that the board should be required to submit its schemes to the Department of Industry and Commerce, and through it, to the Department of Finance, so that we can give it " the once over " before confirming it and bringing it into operation.
There might be something to be said for it—not a whole lot, but something—if the Minister for Industry and Commerce alone were in this sub-section, but the bringing in of the Minister for Finance is entirely unjustifiable.
There is a dual responsibility. There is the responsibility of the Minister for Industry and Commerce to electricity consumers, on the one hand, and the possible demands that may be made upon other organisations with which he is connected, or may be responsible for, to introduce a similar scheme, and there is the necessity for ensuring that there will not be too great a disparity between the pension provisions for Electricity Supply Board employees and those made for the public service.
I entirely appreciate the Minister's difficulty in connection with discussions with the Minister for Finance. I think I have had sufficient experience to know what he was probably up against, but I fail to understand what responsibility the Minister for Industry and Commerce has to electricity consumers in connection with the granting of pensions to the employees of the Electricity Supply Board.
If it involved an increase in electricity charges, surely he has responsibility?
The whole underlying principle of the Act setting up the Electricity Supply Board was to keep the board and its activities entirely free from governmental control. They are, in a sense, a business concern. The whole policy of the Act under which the board was set up was to keep them apart from governmental control. They can, as Deputy McGilligan has pointed out, give any salaries they like. Why should the Minister at this point—I am sure the Minister for Industry and Commerce and his officials do not wish to grasp those powers at all; I believe it is the Department of Finance that is at the back of it—seek to justify those proposals by saying that he has a duty to the electricity consumers to see that their charges are not increased? Their charges can be increased by the board at the present moment in numerous ways which cannot be touched by the Minister.
In normal circumstances that is true.
It is only in one single instance that the Minister is forced— probably reluctantly forced—to justify those proposals on unjustifiable grounds, namely, his concern for electricity consumers, but, even if there were such a duty on the Minister towards the consumers, surely it is no justification for bringing in the Department of Finance. I think the Department of Industry and Commerce would probably have a much broader outlook on this question, and would probably be in a better position to deal in a business-like way with a business board such as the Electricity Supply Board if they are untrammelled by the horror of precedent that there is in the Establishments Branch of the Department of Finance. Even if there is any justification for the introduction of the Minister for Industry and Commerce— I do not think there is any, having regard to the fundamental principle on which the board was set up—there is no possible justification for bringing in the Department of Finance. It is going to bring trouble to the board; it is going to add trouble to the Minister, and will introduce extraneous circumstances in connection with what should-be purely a business proposition.
If the board increase their charges for electricity, I give the Deputy two guesses as to whom all the resolutions of protest will be sent to.
I would not require two.
Does not the Minister know that this is another of those camouflage suggestions? Would anybody send the Minister a resolution protesting against a pension scheme and its impact on charges who had not already sent the Minister a protest against salaries and their impact upon charges? Is it likely that electricity charges will be increased to the consumer because of movements in wages or because of the smaller matter of pensions? The Minister knows very well that the wages matter will be the important consideration in that.
Quite.
And yet the wages matter is entirely outside his control. Of course, we have to run this a little bit into the future. I said before that it seemed to me to be a question of the Government trying to get its hooks on the whole board. If that is not so, if the grappling irons are not out to get this organisation pulled back to the old moorings at Government Buildings, it means that we are going to have this lop-sided concern; that in a public undertaking started by the Government the salaries will be left free; that you will have a group of independent people left to run a business concern in a business-like way; that they will be able to attract their personnel; that they will be able to give them the lines of advance from one grade of employment to another; that they will allow for promotions, for annual increments, for payments for sickness; that they will be able to establish a cost-of-living bonus on their wages; that they will be able to do all that freely, but when it comes to the question of a pension scheme, then some unnamed undertaking in the future might object to the beneficence of a particular board and the Minister for Industry and Commerce and the Minister for Finance must get into consultation over the whole matter. It does not bear looking at. Nobody with any grain of logic or common sense in his being can justify that. I suggest that there is something in the point of view of Deputy Costello that it is the Establishments Branch of the Department of Finance that is trying to get in on this. I go further and say that there is a certain amount of repentance on the part of the people in Government Buildings for having allowed the board to veer away from governmental control. I think the next public undertaking will not get the same freedom that this board got. I think that is what the future holds. I do not think anybody can go on a public platform and justify that sub-section in connection with a board of this type, which is allowed to pay its 2,000 employees, to distribute £750,000 a year in wages, and to give emoluments as they please.
I move amendment No. 12—
In sub-section (1), paragraph (a), page 5, line 21, to delete the words "by the Minister".
The superannuation scheme as now left in Section 5 is one that has in all its details passed the Minister and the Minister for Finance. Then we lay down certain provisions. It has to provide that a fund is to be set up out of which superannuation benefits shall be paid; that such fund is to be administered in accordance with the Act; that it has to be further administered in accordance with regulations, and those regulations must be made by the Minister. Why?
By whom should they be made?
By the board.
The regulations, say, contemplated in Section 8?
Yes. Would not the whole scheme already have been under the Minister's censorship? This is a question of the regulations for the administration of the scheme. It is not even a question of regulations made by the board and sanctioned by the Minister. It is regulations to be made by the Minister for the ordinary administration of this fund. What justification is there for that? The scheme has to be administered in accordance with the Act and regulations made thereunder.
And the Minister makes the regulations in regard to those matters which are set out there:
"...providing for the investment of such fund in accordance with this Act; providing for the keeping and audit of the accounts of such fund; and providing for such other matters relating to the establishment, maintenance, and administration of such fund as the Minister considers proper to be provided for."
In other words, the Minister makes regulations ensuring that the fund will be established that the solvency of the fund will be regularly tested, that various provisions will operate to ensure that there is no speculation with the resources in the fund, and that in every way the interests of the participants in the fund will be safeguarded. Once he comes into the picture at all, it seems to me that it follows automatically that the Minister is under an obligation to ensure that the scheme will be a workable one and that the fund established under the scheme will be properly protected.
But Section 8 does that.
It is the regulations made under the section which are referred to here.
But the fund must be administered according to the Act, and, if Section 8 is part of the Act, it. must be administered according to that section.
According to regulations made thereunder, and the section says that the Minister may make regulations in relation to a number of specific matters.
And he will make-those. Taking out the phrase "by the Minister" will not prevent the making of the regulations required under Section 8. The board must administer the fund in accordance with the Act and we are assuming that Section 8 will be part of the Act. It empowers the Minister to make regulations affecting-certain things.
The Deputy's argument now is that this is a drafting point and that it is not necessary.
It is either tautological, or there is some meaning in it. If it is referable only to Section 8 regulations, the section carries that and the amendment will not take it out, but the Minister can make regulations about everything according to this.
And possibly a scheme prepared by the board would involve such regulations.
Section 8 is to be impressed on the board as part of the Act. Can the Minister give me some example of a regulation he wants to make which is not the Section 8 regulation?
I cannot, but I can contemplate the board preparing a scheme and providing in that scheme that certain things will be done by the Minister, or in accordance with regulations made by the Minister—matters which would be merely administrative and not matters of principle at all.
Does it not mean that on no point of administration of the fund can the board act on its own?
The board is not independent in that respect, I admit.
And in regard to the smallest routine matter will have to get a regulation made by the Minister?
Not necessarily. The Minister may make regulations, but he does not have to do so.
Is there any provision in the Bill for the making of a regulation by anybody other than the Minister?
It is not necessary to have it, so far as the board is concerned.
This is a board with statutory powers and apparently it has been declared that the original Act does not give the statutory corporation power to make a pensions scheme. We are now supplying the deficiency. As a statutory body, it has no powers other than what the State gives. Is there, anywhere in the measure, any phrase which gives the board power to make regulations in connection with anything? I think not, and it seems to me that in respect of any small point of detail, when administering the fund, they will have to get a regulation made by the Minister.
That may be so, and in that case we had better provide for it.
That is what you want apparently.
I move amendment No. 13:—
In sub-section (1) (b), page 5, to delete all words after the word "fund" in line 24 to the end of the paragraph and substitute therefor the words "of an amount not greater than 5 per centum of the salary or wages payable to such person and that the board shall pay to the said fund by equal annual payments over a period not exceeding 40 years such amount as may be actuarially required to keep the said fund solvent".
This I regard as an important amendment. I do not know that we have sufficient material to enable us to decide on a particular percentage such as that I have set out in the amendment, but I should like to have some maximum fixed in relation to the contributions that may be required from members of the staff. As it stands, the scheme is to provide for pensions, on a contributory basis and further that the scheme is to be on a fifty-fifty basis, the State paying in the aggregate as much as the contributions exacted from the staff. It is very hard to get details of pension schemes, but there arc quite a number which can be looked to and in most of them— certainly in most of the English schemes—the 5 per cent. contribution from the staff is the highest demanded, and that is the modern statute. The old statute which demanded a contribution from a staff and laid down a percentage put it at 2½ per cent. of salaries. That has been found actuarially to be unsound. It was unsound in connection with the railways, the scheme there being started on a 2½ per cent basis. Other contributory schemes in operation in England are based on 5 per cent. and on a 5 per cent. maximum.
Certain literature has been written and certain comments made about the 5 per cent. figure on the basis that 5 per cent. never seemed to be necessary as a contribution for pensions of substantial types, but that it was better to have a maximum of 5 per cent. in order to allow for such things as extreme length of years of a staff or—and this is something which had to be provided for in some of the schemes which went actuarially unsound to provide against bad investment of the trust fund out of which the superannuation was later to be paid. If one takes a line from English schemes, however, not universally but in very much the majority of cases, they demand a maximum contribution of 5 per cent. of salaries or emoluments. The Other side of that has to be met in some other way. I do not know what contribution will be required in order to make the fund solvent, but there would have to be a great deal of calculation made in respect of a payment, of only 5 per cent. maximum and one would have to get first—this is not an absolutely new undertaking but one which has been in existence for 15 years—a determination as to what percentage of the staff are even approaching the obvious retiring age. One would have to find a variety of other things, such as the amount of pension that is to be given, but I can give examples and details of reasonable pensions which have been secured to employees on the small ranges of salary earning on a payment of 5 per cent. of their actuarial earnings. There are quite a number of concerns which have built up funds starting at 2½, 3 and 3½ per cent. Five per cent. seems to be the ordinary maximum chosen for either the good type of commercial undertaking or institutions like banks and public undertakings of the type we are considering here.
I put down this 5 per cent. because it is the one that occurred to me on looking through the English legislation. The other side has to be left much more vague, and I say that the board shall pay by equal annual payments over a period not exceeding 40 years such amount as may be actuarially required to keep the fund solvent. I put it in that vague form for the reason that I do not know how many of the staff of the Electricity Supply Board are over 50 or 55 years of age, and I do not know what would be the amount that would have to be put in in order to keep the fund solvent. If one were starting afresh and recruiting people of 20 or 25 years of age, with, of course, special provision for experienced staff of the technical type, one would have a better picture of what was likely to happen, but here there is an element of calculation which will depend upon the details of the staff of the board. A calculation could be made quite easily at once if there was no question of back payments, no question of bringing people in and allowing them to qualify with their past service, but, that being the consideration, it does tend towards confusion. That is why I put this phrase in the rather loose way in which it is worded—that the board would then pay whatever was the amount an actuarial calculation showed was required to keep the fund solvent.
I set out a period of 40 years for this reason: that all this matter of the people who have come into the board's service and have served 15 years and for whom some allowance, I hope, will be made in connection with arrears, will have disappeared by that time, and that complication will not then arise. At the end of 40 years, the majority of those who have given 15 years' service with the board will have gone and that matter will not arise again. After that period, it would be quite easy, actuarially, to find out what is the board's contribution if the staff have to pay 3½, 4 or 5 per cent. I ask the Minister to put in some maximum. It is always subject to enlargement after, if it is not found suitable, but I believe that 5 per cent., on the examples I have seen in other countries, would be quite sufficient to meet the case.
If it is sufficient, well and good. If the Dáil feels strongly that the legislation providing for this pension fund should set out as one of the conditions under which the fund would be established that nobody will pay more than 5 per cent of his salary, that can be considered, provided the principle of equal contribution is maintained and provided it is understood that the pension which a man will receive on retirement will be related to the amount he has paid. What the Deputy is doing is something different. He says that nobody should pay more than 5 per cent. and that, if there is a deficiency in the fund, the board will make good that deficiency An arrangement of that kind would lead to the removal of any inducement to the governing body of the fund to restrict the pension benefits payable to the participants in it. They will know that if any deficiency arises because they increase the pension, because they pay out a larger pension than the state of the fund would justify, the board is required by law to make good the deficiency and the board will have to pay an ever-increasing amount in order to allow the inflated benefits to be paid. That would be the inevitable result of the Deputy's suggestion.
What is contemplated in the Bill is that the pension will be related to the contribution. It will be a matter entirely for the board when they are preparing the scheme, subject to whatever opinions will be expressed to them by those who will benefit by the scheme, whether they will have a large contribution and a large pension or a small contribution and a small pension. We are providing that the board's contribution will be equivalent to the employees' contribution, that the whole scheme must be kept financially sound, and that the fund will have an income from contributions sufficient to enable it to meet the pensions. I could not agree to any arrangement in which the board would be required to make good any deficiency that might arise. If it should happen that a deficiency arises, there will be two ways in which it will be made good — by decreasing the pensions, or by increasing the contributions. The solvency of the fund will have to be assured at the expense of those contributing to it. The suggestion that has been put forward would, in my opinion, lead to a situation in which the pensions will have no relation to the contributions and the entire cost will fall on the board.
The analogy of 40 years that I took was derived from a Local Government Act in England. They made the calculation that a maximum of 5 per cent., with an equivalent payment from the local authorities, would give the pensions scheme that was required. They had to take account of people already in the employment of the local authority; they had to take into account middle-aged men who had made no contribution and in respect of whom no contribution had been made by the authority. They put in a phrase to the effect that the amalgamated group would pay all the contributions for those for whom no contributions had been paid in their earlier years. They allowed them to spread that payment over 40 years and that is where the 40 comes from. The board had certain negotiations with a body of their own, a pensions committee of some sort. They discussed the matter with them and arranged what pensions would be suitable. Various things were spoken about and they discussed in detail what contributions would be required from a man entering at 25 years, 35 years or 40 years. I understood that all those things were actuarially calculated.
We are not putting any limitation on the board.
You are proposing that there shall be equal contributions. Take the case of a person who has spent 15 years in the employment of the board and is now earning £4 a week, a man who entered at 25 and is now 40 and who intends to leave the service at 60 or 65. The proportion of pay that he would have to sacrifice now on the equal contribution basis would be pretty considerable. These people have not made any provision for themselves. Many of them relied on a statement made in 1927 that there would be a pensions scheme. If the back payments were different, or if some more liberal attitude were taken with regard to people who have 15 years' service—not insisting on their paying fully with compound interest— then there might be something to be said for this.
I do not think anybody has raised any great complaint about the magnificence of the salaries that the board are giving their employees. Even from the viewpoint of the Department of Finance, the members of the board have shown themselves to be people who can be trusted in regard to the giving of salaries—but, perhaps, that is no great compliment. Why not leave this a little more open in connection with the payment of pensions? Why insist on the equal payments? I could understand an equal payment if you are going to deal with the arrears in some other way. Take something, not more than 5 per cent., from the employees, and let the board put in the amount necessary to make the fund actuarially solvent.
We are committed to the principle of equal payments. I do not think it is unfair to say that a man who starts to contribute to his pension at 40 will contribute more or get less than the man who starts at 25. We do provide for the man who starts at 40 that, in respect of his past service, half of the contribution will, in fact, still be paid. It is a matter for himself whether he will contribute the other half. He will get a half pension in respect of that period without any contribution from him. The principle here is that the fund should be based on equal contributions from the board and its employees. We allow the board to work out the scheme and, if they want to limit the amount of the contribution and, consequently, the amount of the pension, that is a matter for themselves. If they want to give more liberal pensions on the basis of a higher contribution, it is also a matter for themselves.
I gave examples here to show that higher officials would be paying 20 per cent. of their salaries. The scheme will be under the control of two Ministers. Why, in addition to that, fasten in this legislative phrase that there must be equal payments?
It is desirable that the Dáil should decide now whether it wants a scheme on that principle or on some other principle.
It would be all right if it were introduced at the beginning. Then all the employees would know what was in front of them. This scheme has to come before two Ministers and those Ministers may decide on something contrary to what the board wants.
Nevertheless, it must conform to these principles.
If already there is such control, I suggest it is wrong to put this legislative lock, as it were, on yourselves.
I think the Minister is aware of discussions which took place between an organisation representing the staffs and members or officials of the Electricity Supply Board.
Is the Deputy discussing the section?
I am discussing the amendment in relation to the section, and I am taking up the viewpoint that has been expressed by Deputy McGilligan. I think it has been shown in the course of these discussions that in order to obtain even very low pensions some members of the staff, who have given considerable service to the board in the past, will be required to pay more than 5 per cent. of their wages, and that even then the pension they receive will be decidedly small. Deputy McGilligan seeks in his amendment, to ensure that the maximum contribution that such persons would be required to pay would be 5 per cent., and a 5 per cent. contribution from each side, normally, would make a solvent pension fund. I cannot understand the Minister's reluctance to fix an overriding maximum of 5 per cent.
I am quite prepared to do it, provided that the Dáil understands that that will be related to the pensions payments.
And that the board will pay only an equivalent amount.
Yes.
Deputy McGilligan's amendment seeks to fix a maximum contribution of 5 per cent. from the staff and 5 per cent. from the board, but his amendment takes cognisance of the fact that there are persons who have given considerable service to the board and who are quite incapable of paying a sufficient contribution to bring their services into economic value for pension purposes, and if they were required to do that they would be asked to make a contribution beyond their capacity to pay. The Electricity Supply Board is a very wealthy organisation; it is a substantial revenue-earning organisation, and the consumption of electrical energy produced by the Electricity Supply Board has been beyond all conception of what it was thought it would come to when the first Bill was passed in 1927. Accordingly, it is not unreasonable to ask the board to start off with 5 per cent. contribution as a maximum, but that the board should put into the pool a sum of money which will cover the case of persons who have been in the board's employment and who, during that period of service, were not required to pay contributions and in respect of whom it would be a decided hardship now to ask them to pay arrears of contributions over 15 years. As Deputy McGilligan rightly points out, this is a transitory problem. It will disappear in the course of time, according as the people concerned retire, and then you can have a normal pension scheme with a contribution of 5 per cent., or perhaps less, from each side. But I think it is not unreasonable to ask the board to put into the pool a sufficient sum of money to cover the services of persons who were in the board's employment prior to the introduction of this Bill. It will not put any great strain on the board's resources. It will not affect the board to any great extent, and a contribution of that type from the board would probably overcome many of the objections that have been levelled against this scheme, because of the fact that it makes a person pay a substantial additional contribution in order to make his past services available for pension purposes. I think we should require the board to put something into the pool in respect of that past service so as to make it available for superannuation purposes in the future.
But it does that in respect of past services.
And then they get half time for it.
It makes the worker pay for past services.
It gives him a choice.
Yes, and imposes penalties on him if he does not exercise the choice in the direction of paying. I suggest that it is not unreasonable to say to the board: "Having regard to the whole history of this legislation, the relief given under the present Act, and the fact that this is a transitory problem and a very small problem, relatively, in your finances, you ought to put the entire sum of money into the pool. It would place no great strain on your finances and it would solve the pension problem which has been a source of discontent during past years."
I think that this pension scheme is quite generous compared with pension schemes operated by other organisations of similar size.
What organisations?
Would the Minister give an example of the organisations he is referring to?
I mean ordinary industrial or commercial firms in Great Britain that have pension schemes for their employees. There is none of comparable size here.
The only one I know of is that connected with local government officers in England in 1922, which I have already mentioned.
On the last occasion, I spoke of the scheme of the London, Midland and Scottish Railway Company.
Had they, at any time, to make provision?
The contribution was a like sum in respect of past services. It is the same principle. They can pay over a period of years the appropriate contributions in respect of their past services, and the company shall pay its appropriate contribution for past services. The only thing I can say, in reply to Deputy Norton, is that the principle of equal contribution is an essential part of the Bill, and whatever limitation is imposed by statute upon the amount of the person's salary that may be payable as a contribution for pension purposes, or whether we leave it as it is in the Bill at present, that principle of equal contribution must be maintained.
I have no objection —at least, I have an objection, but I am prepared to waive it—if it were to be as from this moment on. I do take the example of the 1922 legislation affecting local employees where, when they were starting a particular fund, they fixed a contribution of not more than 5 per cent. on, each side and then said to the local authorities: "You will meet the cost of the previous years' service but we will allow you to spread it over a period of 40 years."
The Deputy's amendment is open to the objection that the governing body of the board would have no reason to relate the pensions payable to the revenue of the fund at all, because if any deficiency arises the board will have to make it good. I would not put any man in the way of temptation. I am talking about the governing body of the fund.
This is to set up a scheme, or the general provisions in regard to a scheme, and I say: if we are going to impose any obligations on them, do not take more than 5 per cent., and, with regard to new entrants, pay an equivalent amount. Let us think of this now and bring it back to reality. The board's revenue is about £2,000,000 in the year. It has been asserted, and I assert it again, that what we are talking about would not amount to £10,000 in a year. What the board would pay, let us say, to their permanent pensions committee would not cost an extra £10,000. That is, on the basis of paying up for the back years, with arrears of compound interest and so on, it would not cost £10,000, and that is very little in relation to £2,000,000.
It is important all right.
It ia only 5 per cent.
Yes, but a number of these together amount to a lot.
It would take a long time.
The board are allowed to pay some £750,000 each year in wages, but when it comes to paying merely £10,000 for pension purposes we have all this trouble and argument, with two Ministers to look over the scheme, and then, for fear they would go wrong, we have this legislative lock on the whole thing, that you must have equal payments. Really, there should be some common sense.
It is still true to say that the board's revenue is insufficient to meet all the charges.
All I can say then is that the Minister for Finance got his last loan under false pretences, as one of the great assets which he placarded over every hoarding was the Electricity Supply Board. You cannot have it both ways. Either that was an asset or it was not.
I referred to the charges which it was contemplated should be placed to the revenue of the board.
If it is not an asset, the Minister for Finance got people to lend him money under false pretences. Prominently, if not in the forefront of the display on the hoardings, was the Electricity Supply Board as the greatest asset the State had.
I do not think so. That is an exaggoration. After all, I am the greatest asset of the State.
Well, he did not placard you, and yet the loan succeeded.
Is the Minister aware that a discussion took place between representatives of the employees and the board in connection with this pension scheme?
We are laying down certain principles, to which a scheme introduced by the board must conform. We do not say anything about a limitation on the contributions of participants—whether it is to be 5 per cent. or any other per cent. They must work that out for themselves. If they wish to limit the contribution to 5 per cent., well and good. I do not think we should impose a statutory obligation on them to place a limit to the contribution. If the board, in consultation with this pensions committee, or "off their own bat", or under pressure from the committee, want to place that limitation on the contributions to be paid, they can make that a part of the scheme.
It was asserted during the discussions between the board and the pensions committee that the amount which it would be necessary for the board to pay could be met by a contribution of £10,000 from the Electricity Supply Board.
But it is not going to be met.
It will not be met, because the Minister will not allow it to be met.
And I think there are good grounds of public polity for that.
Here you have a wealthy undertaking, earning close on £2,000,000 per annum, and £10,000 is an infinitesimal amount in that income. The provision in this Bill whereby the staff must pay a contribution in respect of past services in order to make it effective for pension purposes, has begotten a good deal of hostility to this measure. Having regard to the fact that the staff believed in 1927 that they would have a scheme prepared under the parent Act, and that 15 years have elapsed since then, surely the Minister is not asking the board to do anything unreasonable if he says at this stage: "Put in £10,000 to make this fund solvent in respect of the past services of your employees, because of the very unusual circumstances surrounding the non-application of a pensions scheme to the staff." The Minister knows perfectly well that a contribution of that amount will have no deleterious effect on the finances of the board. Would the Minister undertake to examine this?
No. The principle of equal contribution is an essential part of the Bill. I could not hold out any hope whatever that that will be departed from.
I move amendment No. 14:—
In sub-section (1), paragraph (b), page 5, line 26, to delete the words "equal in the aggregate to" and substitute the words "not less than".
This is another way to meet the same point.
It is the same principle.
It would leave it open to the scheme to provide for an emergency situation, where the board might pay more.
In an emergency situation, involving the finances of the board to such an extent that solvency could not be maintained, it would have to be met by new legislation, as in the case of the teachers' pensions.
I mean a particular emergency created by the back payments.
We cannot do that.
I move amendment No. 15:—
In sub-section (1), paragraph (f), page 5, line 41, before the word "leaving" to insert the words "dying during service or".
Does the Deputy consider No. 17 dependent on No. 15?
Yes. I do not know whether "leaving employment" means leaving by death? If it does, it is all right. As the sub-section stands, it enables the scheme to provide——
Gratuities payable on death.
"Leaving the employment of the board"—does that mean people who die?
It does.
Is that in it? It says that they are to be repaid the contributions paid by them. You could not repay them in that case, as they would be dead.
We do not exclude the payment of gratuities if the scheme provides for it.
The only type of exceptional provision is that referred to in paragraph, (f)—"provide the circumstances in which persons leaving the employment of the board before they have become entitled to superannuation benefits under the scheme will be entitled to have contributions paid by them under the scheme repaid".
In case of death, it is contemplated that there will be a gratuity which may have relation to the number of contributions paid.
It is a question which someone may have to decide in years to come. Someone may look up Section 2 and say there is special provision with regard to the whole ten members of the board, for a person dying during their period of office. Then in sub-section (7) there is the superannuation scheme, and it provides for the circumstances of persons "leaving" the employment of the board—that they will be entitled to have the contributions repaid.
I think it is clear that the scheme will provide for contributions payable on death, but I will look into the draft of the measure and make sure of it.
I move amendment No. 16:—
In sub-section (1), paragraph (f), page 5, line 44, before the word "under" to insert the words "and on their behalf".
This is the case of people who leave the board, or die before they become entitled to a pension, to have their contributions paid to their personal representatives—not merely the contributions they have paid but the contributions paid for them.
I could not agree to that at all. The board's contributions and the person's contributions to the fund are different. A person leaving the employment of the board before becoming entitled to superannuation benefits will be entitled to get only what he himself has paid. He cannot regard the fund as a sort of savings bank into which the board is to put contributions on his behalf. That would be contrary to the provisions of any of the schemes I have seen.
It may not be, with regard to people who voluntarily leave, but in regard to people who died in the service.
Would the Minister meet the case of those who die in the service?
I have said that it is contemplated that the scheme would provide for that.
Deputy Norton is asking that the representatives of those who die would get not merely their own gratuities but those payable bv the board.
It is contemplated, that the amount they will get will be greater than the number of contributions paid but, nevertheless, it will have relation to the number of contributions paid. That is a matter for the scheme.
May we take it that the gratuity they will get will be what they have paid themselves, plus what was paid on their behalf?
I am not drafting the scheme, but presumably it will amount to the contributions paid plus the earnings of those contributions.
The contributions paid, not merely by the deceased, but by the employer.
By the board.
I move amendment No. 18:—
In sub-section (2), page 5, line 51, to delete the word "continuous".
Does this amendment cover Nos. 21, 24, 25 and 28?
There is one small difference here. One of the lettered paragraphs seems to make provision for service which is continuous. It says that you count only such continuous service—that is paragraph (b) of sub-section 2. I am arguing this point again. Supposing a person comes into the service of the board and goes out before he becomes entitled under the scheme—I do not know the scope of the scheme, but I presume there will be a minimum number of years service in order to become entitled to a pension at all—he would not be qualified for a pension. He goes away because he may be offered some better work, or his work may be uncongenial, or he may ask for a change which he does not get and there is some pique. He gets cool later on and comes back again. By breaking his service for a month, he will lose the benefit of the years he has served previously.
There is in a later section a provision which, if it does not apply comprehensively, might be made to apply comprehensively, to employees, so that a person would not be allowed to do a certain number of years, then cash in on something in the way of a gratuity and come back and seek to have the early service counted in. All sorts of things may break the service of employees of the board. If they can get better employment, leave what they have behind them in the fund, and come back——
So far as the clerical employee is concerned, when he leaves, he draws out his contributions. When he comes back, he comes back as a new entrant. So far as he is concerned, his account was closed when he left.
I think that that is right. But suppose that the scheme says that a man will not qualify until he serves ten years. He serves eight years and leaves. Having served six months elsewhere, he thinks he would rather work with the Electricity Supply Board. He starts off again anew, although he has drawn nothing from the fund.
If he has only two weeks' service, he gets his two weeks' contributions back.
We do not know that.
The scheme may provide for that.
The scheme may provide for a minimum period of service.
The position of the fund in relation to this employee, when he left the service of the board, would be that there was nothing in the fund for him. Whatever was put in the fund by him was taken out.
Have you provided for that?
We shall provide for that. He will be entitled to have his contributions repaid.
His own contributions?
Yes.
But not the others?
No.
If he leaves the service of the board and goes back, he cannot count the sum paid by the board to his credit?
No. I am assuming that the man leaves voluntarily, with the hope of improving himself. He gets whatever he had paid into the fund and he closes his account. If circumstances compel him to seek employment in the service of the board again, he is exactly in the position of a new entrant, so far as the fund is concerned. In the case of a manual worker we provide two alternatives. If he leaves under circumstances in which he imperilled the electricity supply, he is not entitled to draw from the fund the amount he has paid into it. It is only when he leaves voluntarily for the purposes indicated by the Deputy, or similar purposes, that he can exercise the right of withdrawal.
Under 7 (f) you contemplate that no matter how short service a person has, he will draw out his own contributions when he goes?
We empower the board to prepare the scheme on that basis.
The board might say, or the Minister might say when the board sent this scheme up to him, that men should not be allowed to be wandering in and out every year, drawing whatever sums they have to credit. It may be decided to fix a minimum period of five years' service and not to allow a man to have his contributions repaid under 7(f) if he has not that service. It may be that the scheme will, eventually, provide that it is only after five years' service that employees will be enabled to take out their contributions.
The obvious interpretation of 7 (f) is that a person leaving the service of the board will be entitled to withdraw his contributions.
If the phrase ran: "provided that persons leaving shall be entitled..." I should agree. But what you say is: "provided the circumstances in which persons..." Would it not be quite simple to say: "Persons leaving the employment of the Board shall be entitled to have contributions repaid"?
I can see that the board in their scheme could set out certain circumstances in which this would not happen.
I am looking at the exceptional case.
I cannot see the board preparing a scheme in which a person could not exercise that right at the end of five years.
If a person leaves the board's service and draws out his contributions, he should not be entitled to say that he wanted his back period added. If a person serves ten years and leaves, he gets his contributions but he leaves behind, to inure to the benefit of others, the equivalent contributions by the board. He may be out of the service for a month or two and, when he comes back, he starts all over again. The nest-egg he left is divided amongst others. It would be easy to deal with this matter by not insisting upon continuous service. According to the first part of (b), if a person has drawn his contributions out, the earlier years will not be reckonable unless he repays.
A manual worker who leaves his job and who leaves his contributions there, will get the credit of them if he comes back. I do not understand at the moment why we have not a similar provision in regard to the other employees.
It is because it is not intended to allow these people to reckon these years for continuous service.
I shall look into the point as to whether we cannot make similar provision for clerical workers to that contemplated for manual workers.
I move amendment No. 19:—
In sub-section (2), page 5, line 53, to delete the word "or" where it first occurs, and before the word "shall" in the same line, to insert the words "disability, abolition of office, marriage or such other cause as shall be defined in such scheme".
This sub-section limits the circumstances in which even continuous service will be reckonable. Age and ill-health are the only grounds set out. Suppose a lady clerical worker retires for the purpose of getting married. That is not regarded as retirement which would allow her to draw, anything from the fund. Then, there is the old point as to whether ill-health covers disability. On a wide interpretation, it could be made to cover it. Suppose that the technical post which some person held was abolished. That is not retirement on account of age or ill-health. These things appear to be blocked. I suggest that the words "or such other cause as shall be defined in the scheme" might be added.
I take it that ill-health covers disability.
But the girl who leaves to get married is precluded, as the sub-section stands. Retirement from work on the ground of age cannot be equated with the period at which a person leaves to get married.
In the case of marriage, similar provision to that in the case of death would be preferable—a gratuity. I do not know how it would affect the finances of the fund.
I move amendment No. 20:—
In sub-section (2), page 5, to delete all from and including the word "and", line 54 to the end of the sub-section.
This sub-section deads with the question of people going on strike. They will forfeit their contributions. I have a secondary amendment to this amendment. The things which may lead to forfeiture include service broken through wilful action on the part of the worker which "caused, or might have caused" interruption in the generation, etc., of electricity. I draw attention to the words "might have caused". The grounds also include action which "might have" impeded the due performance of any of the functions or duties of the board. By the 1927 Act, we have brought in the Conspiracy Act of 1854. That dealt with the supply of essential services, such as gas and water supplies. We are dealing here with a board which has bigger functions than the management of any gas or water undertaking ever had. The functions of the board are very generally described. They may do anything that will lead to greater distribution of electricity in the State. Amongst their specific functions, there are such things as running business places for the sale of electric bulbs. As I read this provision, if any worker was guilty of conduct which a tribunal declared might have impeded the board in selling electric bulbs, he would forfeit his pension rights.
There has got to be a break in his service.
Suppose a messenger delivering bulbs goes on strike to get better terms, that might be regarded as impeding the board in discharge of its functions. Any worker commits a criminal offence under the old Act if he prevents the distribution of essential things, such as gas, electricity and water. Now, we are putting the messenger or the man who drives a van with electrical goods on the same footing as the man who tries to destroy one of the main transmission wires. I should rather have the old provision. It is a criminal offence for people to behave in certain ways in regard to essential services such as the supply of electricity. Then, the things which "might have caused" what is set out in the Bill, or which might have impeded the board, need not necessarily result in any of these things. It is not only a break-down that might have resulted in an interruption in the transmission of electricity that is covered, but a break-down in the service which the Electricity Supply Board renders to the public in their showrooms and by the sending out of their vans. The penalty is too rigorous. This Bill does not repeal the existing law, and it always remains a criminal offence for people to behave in certain ways in regard to the supply of electricity.
I do not want to give the idea that I want to conceal in any way the intention of this provision. It is provided that an employee of the Electricity Supply Board who elects to participate in the pension fund will not be entitled to go on strike except he is prepared to suffer the penalty of loss of pension rights. This was one of the principal matters of discussion on Second Reading. There is a very good case to be made for requiring that workers employed in an essential service, like that of the Electricity Supply Board, should not go on strike. Not merely does the welfare of the whole country, but the livelihood of thousands of other workers, depend upon the continuity of their operations. We are not preventing them from going on strike. We are not compelling them to enter a pension scheme. These workers are getting standard trade union rates of wages, as set out in agreements between employers of similar classes of workers and the unions catering for these workers. So far as the trade unions recognise these rates as reasonable, these employees get reasonable rates of wages. If we propose to give them something over and above the wages they are receiving, we think we are entitled to ask, in return, that they will not jeopardise the livelihood of other workers and the prosperity of the whole country by withdrawing their services. There are other public services in respect of which we will, at some stage, get to the point where there will be a common recognition by everybody, including representatives of the workers, that it is not desirable in the interests of the workers that these services should stop. We hear a great deal about the right to strike. That phrase has been used frequently in connection with this Bill and other Bills. The worker's fundamental right is to justice and, if we restrict his right to secure justice by withdrawing his labour, we must give him an alternative means of getting justice. Therefore, we propose to provide in this Bill that a worker who elects to limit his right to strike will be protected from injustiee by setting up between him and the board, or as an appeal tribunal from the decisions of the board, a tribunal which will be impartial.
I know that the constitution of this tribunal has been criticised, but, as I told the Dáil before and told the Trade Union Congress, my sole desire is to get an impartial tribunal. Any proposals which appear to be more acceptable to the representatives of the workers concerned, or to the Trade Union Congress, and which I am satisfied will give us an impartial tribunal, will be acceptable to me. But I want to make it clear beyond doubt, and particularly I want to remove doubts in the minds of the workers concerned, that the tribunal will be impartial. It will be a tribunal which will be a protection for the workers, and will be designed to ensure that in any dispute between them and the board justice will be done. That is all that we are doing here. We are not compelling any worker to elect to enter this pension scheme at all. The worker who prefers to maintain the position of alleged independence which he now has, or his right to withdraw his labour to rectify his grievances in that way, can continue to do so, but he will not get the benefit of the pension scheme if he does that.
And that is justice.
Certainly. He can at any time elect to exercise the right to withdraw his labour subject to the provisions of the old Act that Deputy McGilligan referred to, provided he realises what is involved in that. The Dublin Corporation workers did that.
They went on strike knowing that by doing so they were sacrificing their right to pensions. That right was only restored to them by the Government when it decided to reintroduce legislation specially drafted for that purpose. Those employed by the Electricity Supply Board can do the same thing, but I want to tell them that if they do it in unlikely that any legislative provisions will be introduced here to protect them, because I am convinced that public opinion in all parts of this country, and among all classes in this country, will eventually develop to a realisation of the desirability of preventing stoppages of work resulting from disputes in essential undertakings on which the livelihood and employment of everybody else depends. We have had these disputes in essential services, often called at short notice and causing widespread hardship and inconvenience amongst other working-class families often irresponsible disputes caused not by any real grievance or promoted by any responsible organisation, but merely by the whim of a few individuals responsible to no one. I think we should get into the position in which that will not happen. If we do, then I think there is an obligation on us to ensure that the workers concerned will have reasonable protection gainst injustice.
Objection has been taken to the principle of establishing a tribunal here. The tribunal provisions of this Bill are inserted as a protection for the workers only, but if there, is objection to them they can go, but if they go the position of the worker will be that if he goes into the pension scheme a break in the continuity of his service will deprive him of his pension, and there will be no appeal. The purpose of the tribunal is to give the right of appeal, and I think that is in the interests of the workers. I know that the Trade Union Congress take objection to the section which requires a worker to sign a document in which he accepts this position. I am not prepared to insist upon that. Again, I think it is a protection for the worker. At any rate, I think it is desirable that the very special obligation he undertakes when he decides to become a participant in the pension scheme should be brought to his notice. It is not a fundamental matter as to whether that obligation is brought to his notice in one way or another. If there is objection to bringing it to his notice by asking him to sign a document in which that is set out, then we can do it in some other way. But, in my view, it is desirable, first of all, that the tribunal should be there, and, secondly, that the worker should be fully aware of what his position will be if and when he elects to become a participant in the pension fund.
On the question of a break in the continuity of service, terminating the right to pension and involving a sacrifice on the part of the worker, I am not prepared to accept any modification of what is in the Bill. That must stand. I think it is essential that it should stand. The alternative to it is to take manual workers outside the scope of the Bill altogether. If there is a case for doing that, it can be argued. If we give to the manual workers employed by the board the same rates of pay that manual workers employed by other employers are getting, then their position is reasonably good so long as it can be held that the rates of pay of other manual workers are reasonably good.
It certainly cannot be held to be an obligation on the part of the Electricity Supply Board to pay more than the standard rates of wages which are recognised by the trade unions for appropriate employment. If, in fact, we make provision for pensions for them, then I think we should require from those manual workers, in return for that, an undertaking to ensure that, except in circumstances of a very exceptional character, their services will be carried on, and that minor disputes concerning rates of wages and conditions of employment will be settled by negotiation or arbitration rather than by strikes.
I welcome this discussion. I told the representatives of the Trade Union Congress that I was prepared to accept any amendment that they might suggest to the section relating to the establishment of a tribunal, and the constitution of it, provided that it gave what I was satisfied was a fair tribunal.
I also told them that I was prepared to consider any amendment they might offer to Section 12, if they had an objection in principle to that section, although I think it might be necessary to substitute for it something to ensure that the worker who elected to become a member of the pension fund realised what precisely he was involving himself in.
I regard this as being a particularly vicious portion, not merely of the section but of the whole Bill. I think the Minister is hugging an illusion if he imagines that an amendment of this kind inserted in this legislation is likely to have the effect of guaranteeing him immunity from an interruption in the generation and transmission of electricity if factors exist which so severely irritate the workers as to bring about such an interruption. I do not suppose that any reasonable person in this State desires to see any interruption in the generation and transmission of electricity in this country, because it only needs a few moments' thought to conceive the dislocation that would be caused thereby. But, having said that on the one hand, I think it is necessary, on the other hand, to look at what the Minister is doing in this section. The right of the worker to withdraw his labour is older than electricity itself. It is older than gas itself, and is older than any of the utility undertakings that have given rise to the legislation which makes it a penal offence for a worker to withdraw his labour in respect of these vital services. The right of the worker to withdraw his labour is a natural right. It is a right which is inherent in the right to live. In this particular section we set out to deprive the worker of that very natural right. He is the only class of industrial worker that we set out to deprive of his natural right to strike. I think the Minister is foolish to imagine that this section does, in fact, deprive the worker of his right to strike. This green Bill and other green Bills will be of no use in trying to establish that position by imposing penalties because workers decide to withdraw their labour.
A far better approach to the whole problem of avoiding disputes in essential undertakings would be the creation by co-operative effort—and I underline co-operative effort—of wage-negotiating and condition-fixing machinery which would produce both on the part of the employer and of the worker a recognition of the essentiality of the service, and a recognition that there is a certain overriding obligation to the community at large. A recognition of that type on the part of workers ought to beget on the part of employers a similar type of recognition. With a reasonable balance of mind on the part of both sides, I think you would then get a type of machinery the very essence of which would be the avoidance of disputes which lead to interruptions in the public services or in essential services. I think that, in respect of the Electricity Supply Board, the Minister might very well have got that type of machinery by the expenditure of very little time. He might very well have gone to the unions concerned and have discussed the matter with them, and I refuse to believe it would have been impossible to get agreement on the matter. Instead of that, the Minister gets into the jackboot and puts this particular sub-section in Section 7 and declares to all and sundry: "If we make provision for a pension for you to save you from destitution in old age, then we are going to make sure that we will withdraw your natural right to withdraw your labour."
No.
That is the effect of what the Minister is doing. The Minister may not desire to do that, but that is the effect of what he is doing, because he is saying in this particular section that if a worker withdraws his labour and causes an interruption in the generation, transmission or distribution of electricity, or if he impeded or might have impeded the due performance of any of the functions or duties of the board, he loses his past service for pension purposes and he loses his contribution. So that, in order to get a pension when he reaches 60 or 65 years of age, he has got to undertake never to withdraw his labour, no matter how indignant he may feel at any treatment which he receives from the board or from the peculiar type of tribunal which is established under this Bill. I think the Minister might very well have sought a remedy if, in fact, any remedy is needed in respect of the Electricity Supply Board for the avoidance of trade disputes, in another direction.
Happily there has been no dispute in the Electricity Supply Board. The Minister might have had a better public case, appealing to a certain type of employer's mind, if he had quoted other cases. The Employers' Federation have taken credit to themselves for having been responsible for the introduction of the Trade Union Bill and have taken some of the credit for the introduction of the restrictive clauses of this Bill, but there is no reason whatever for singling out the Electricity Supply Board employees for the type of treatment that is indicated in this section. There has been no dispute in the Electricity Supply Board. I think the relations between the staff and the board have, on the whole, apart from certain Ministerial meddlesomeness, been quite good. There has been no dispute. There has been no friction. The board has produced electricity on an enormous scale, a scale never previously contemplated, never contemplated when the parent Bill was introduced. Things have run smoothly. Yet, in the middle of all that domestic peace, so far as the Electricity Supply Board staff and the board are concerned, we get a jackboot section of this kind which, I think, is calculated to annoy and irritate people and which will not get the result which the Minister desires.
This Bill has waited for 15 years. The Minister is on the wrong line today in connection with the avoidance of disputes in the Electricity Supply Board, and I would suggest to the Minister that even now he might withdraw this particular section or subjection of the section and endeavour by discussion with the board, with the unions catering for the board's staff or with the Trade Union Congress, to get a type of negotiating machinery the essential purpose of which will be the avoidance of dispute and which will recognise the necessity for maintaining the service. As the sub-section stands, it is most objectionable, most reprehensible. In a time of crisis and time of dispute between the board and its staff this section is not worth the paper it is written on, any more than it was ever proved to be worth the paper it is written on in respect of disputes in other industries.
There are three things that ought to be considered, in connection with this new step— whether forward or backward depends on the point of view—first of all the offence that may be committed by a member of the staff of the board; secondly, the tribunal that is to adjudicate on the offence; and thirdly, the penalty. As we stand at the moment, under Section 110 of the 1927 legislation, we have applied Section 4 of the 1875 Act. The result of that is that breaches of contract by persons employed in the supply of electricity become criminal offences and that is the situation at the moment. If there is a criminal offence or if a criminal offence shall hereinafter be committed it shall be determined by a judge under that section. I could have imagined the Minister saying: "Here is an opportunity and I will avail myself of it and I will say in regard to pensions that anybody who is en route to qualifying for a pension will not get the full length if he is convicted under the 1854 Act."
The Minister would then be going to put on an extra penalty to a court determination of a crime. What does he propose to do? He proposes now to add to the offence if a person breaks service in such a way that it causes or might cause an interruption in the generation, transmission or distribution of electricity. Let me take it that these three words go no further than what the 1854 Act thought to be a break in the supply of electricity. The Minister adds that penalty if a person breaks service in a way that impedes or might impede the due performance of any of the functions or duties of the board. What are they? The generation, supply and distribution of electricity, to start off with. But there is a variety of other functions—research work in connection with electricity, appliances, and their sale. Eventually, the board may manufacture appliances and, by a later Act, not the 1927 Act, we gave the board certain powers with regard to the salmon fisheries around Limerick. That is part of the functions of the board. So that anybody who breaks service now in a way that might impede the board in selling electric bulbs or in looking after the fish on the Shannon, is going to be on the same footing as far as this is concerned as those who interrupt the supply of electricity.
And, as to whether a person has impeded the board in the discharge of any of its functions, there is no longer going to be a judge and a jury. They are the people who would decide under the old Act. It is no longer a judicial determination but a determination, in the end, by a nominee of the Minister. There are going to be three people on the tribunal to decide. One is to be a representative of workers, so to speak, one representative of the others. Let us say they would be biased and, in the end, you are going to have a determination by a person, not necessarily a judge, appointed by the Minister, and that person is going to determine whether on a particular occasion some manual worker in the board's service has brought about a situation which might be regarded as one that might have impeded the discharge by the board of some of its functions. I think that is a very wide enlargement. What is the penalty? Whether the Minister cares to run them before a court or not as committing the criminal offence, he can run them before his tribunal and get them deprived, not merely of pension, but of their own contributions paid into that pension fund.
If the Minister were here going to set up general legislation with regard to strikes, I would go some part of the way with him with regard to, say, lightning strikes. There is a considerable volume of opinion, and I think there are certain people in the labour movement not unsynipathetically disposed towards the growth of public opinion in that matter against the immediate interruption, not of things of essential service but of things some way removed from that. The Minister is not setting up a general code in regard to strikes. He is trying to penalise one group that come under his control, and I think he might have been satisfied to do the ordinary thing and say: "It is already a criminal offence to do certain things, but you have the rights of the ordinary citizen to a judge and jury to determine whether that has been done or not, but once they find you guilty we will stop your pension rights. Once judicial proceedings have ended in the determination that you have been guilty of something against that old Act, we will not allow you to take part in the pension rights and we will make you forfeit the payments you have already had deducted from your salary."
The Minister might have done that and there could be no great comment on it. But he is going very far, I suggest, in enlarging it in the way in which he is doing it. He is certainly going very far with the tribunal as at present constituted. The person may be a layman or a civil servant attached to the Minister's Department. The person to be appointed by the Minister may not have any of the ordinary qualifications of people who determine between citizen and citizen. The Minister will have his nominee. It is a very wide clause and refers to something that may have impeded the board in the discharge of its functions. I suggest that this is not the time for that. If the Minister wants this matter dealt with, let him deal with it by a definite frontal approach to that particular matter. I ask him to consider the question of industrial courts established by agreement between the parties likely to be concerned. I do not think the Minister will bring forward, with any great hope of getting agreement on the matter, an industrial court to decide a dispute where the board is balanced as between the people likely to be concerned and is to be presided over by a nominee of the Minister. I do not think he would get a reasonable acceptance of that view at the present time. That may be the situation under the old industrial courts law, but there have been very few sittings of that court. The Minister would not get an easy acceptance of the idea now. I ask the Minister will he get an easy acceptance of the idea of a lay tribunal to determine what really amounts to a criminal offence and with the penalty of forfeiture of payments made. He could not possibly get acceptance of that.
If you segregate out one matter, is the Minister likely to make his appearance before the public, as an introduction to his new idea with regard to strikes, and say that in connection with the sales rooms of the Electricity Supply Board he is going to prohibit people in these rooms from striking, by saying: "We will not allow you to indulge in the benefits of a pension fund unless you guarantee not to strike," and add further as another acceptable point that "the determination of whether you have done something affecting the service or impeding the board in the discharge of its duties through your activities in the sales rooms will be not by a court and jury, but by a lay board"? I do not think the Minister will come forward with that. I think he is rather wrong to avail himself of the opportunity presented to get this in in a side way.
With regard to this amendment, I have no special view as to its desirability or otherwise. I would simply like to ask whether, in connection with this general arrangement for pensions for the employees of the Electricity Supply Board and the desire of the Minister to prevent strikes in the service, he will consider as an alternative the amending of the Industrial Courts Act to provide for the Electricity Supply Board in particular. The Industrial Courts Act provides that the employer and the employees must agree before the matter is brought before the industrial court. So far as I can understand the general principle of the Act, it will be always in the power of the Minister to amend the Act in respect of certain types of industry covering a large, or narrow field. It will be possible for the court to come into operation for a specific purpose, so that if the Minister or the workers or the employers make a request to the court to examine any particular question, automatically the court will sit. As at present established, the request must be made by both parties. So far as I can see, there is nothing to prevent the Minister amending the Act so that only one party will be sufficient to invoke the powers of the court. I ask the question in order to find out whether the Minister has power to do that. This is a matter which interests people who have made a study of industrial disputes in this country and in other democratic countries. The Minister is aware that in more than one of the small democracies in Western Europe the industrial court is of the type I have described, where either party to the dispute can invoke the court, and the court in these countries is used to a greater extent.
The courts established under the Industrial Disputes Act have no power to make binding awards. If we are to take the step contemplated, that is, to make it an unprofitable matter for the Electricity Supply Board workers to go on strike, we must do something more than merely give the right to get an award from an industrial court which has no binding effect on anybody, unless we propose to give them the right to strike. The Bill proposes a tribunal with power to bind the board if the award is in favour of the workers.
Could not the industrial court be empowered to give a binding award in the case of public utilities, as it does in a number of countries, including New Zealand?
That would mean a much more elaborate piece of legislation than is contemplated.
That would be a frontal attack.
The Deputy says we picked out these workers for this limitation because they were under our control. It is more correct to say that we picked out these workers for the benefit of this legislation because they are so immediately associated with the Government service. I say that the net result of the Bill from the workers' point of view is that they are getting something that 95 per cent. of workers never hoped to get, and that is the possibility of retiring at 65 upon a pension that will guarantee them economic security in their old age.
That was promised in 1927.
I should like to have a much more specific promise of a pension than is given in the 1927 Act.
I will read it again.
Do not.
I ask the Minister to consider some restriction of the terrific scope of this. I do not see any objection that will impress itself on the public in a dispute that when people are found guilty under the old Conspiracy Against Property Act they should forfeit rights that otherwise they would have under a pensions scheme. I do not see any great objection to an enlargement of that to make it specific with regard to electricity that it definitely includes the interruption of the generation, transmission or distribution of electricity to be judged by a judicial tribunal. Surely it is an amazing enlargement to say that a tribunal is to decide this matter and to decide it not merely in relation to the generation, transmission or distribution of electricity, but to all the various functions of the board.
I do not think you can distinguish between the workers of the board.
It is a question of what the activities result in. Do they result in an interruption in the supply of electricity? If they do, that person can be found guilty by a criminal court, and you can add on the additional penalty that he will lose his pension as well. The Minister is now asking a lay board to decide not merely that matter——
I do not know what the Deputy means by a lay board.
A board which is to be composed definitely of two laymen and of which the chairman will also be a layman.
It will have judicial powers.
It will have judicial powers, I know, but why have we in this country gone to the trouble of building up an independent judiciary?
The Deputy can, if he likes, bring forward an amendment to provide that the members of the tribunal should be members of the legal profession, but I do not think they would be the most suitable members.
The Minister misunderstands me. We in this country, and the people of all other countries, have built up an elaborate fortification around our judges. We put them beyond the reach of temptation or of influence from the Executive. We do all that by making them independent under the Constitution and by various material considerations. We do it because we want them to be impartial in their duties, but we have none of that here. It is not a question of a legal body. It is a question whether a person is to be in a position freely to determine a point that comes before him. Surely, it would be better for the community to have some body of a judicial type?
This section contains what the Minister must know is a very obnoxious provision. It is not of very much importance whether this Bill is passed in the next month or in the next three months having regard to its present provisions. At least, it does not matter so far as the manual staff are concerned. Would the Minister even now undertake to initiate further discussions with the workers' representatives or the Trades Union Congress with a view to getting accepted a type of wage-fixing machinery which will create between the staff and the board that sort of atmosphere which will not make it necessary lo insert such an objectionable sub-section?
These sub-sections have to stay in. The Government are not going to put themselves into the position that pensions payable under the Bill will still continue to be payable if there is a break in the continuity of service in the circumstances contemplated. The Government is prepared to leave, and in fact did consider leaving, manual workers outside the scope of the Bill altogether. We can stop before we come to them if you like, but we have got to do more than that.
We must give them this right which is a protection against arbitrary action by the board in matters relating to their employment. The constitution of the tribunal is a matter on which I am prepared to consider any reasonable proposition. I take it that the first thing that will happen if there is a dispute as to rates of wages or conditions of employment is that there will be negotiations between the board and the employees. It is only in the event of the failure of these negotiations that there will be an appeal to the tribunal. The tribunal can have any constitution the Deputies wish. The one thing I am concerned with is that it shall be of such a character that its impartiality will be beyond question. I do not mind what procedure is adopted, who appoints the chairman of the tribunal or the other members for that matter, provided that there will be a feeling in the minds of the people concerned that the tribunal will be impartial as between the board and the employees, and provided also that if it becomes clear to the public, to the board or to the workers, that over a period of time there is evidence of partiality, of unfair dealings or of unfair handling of relations between the board and the workers, there will be power to change the members of the tribunal. I am prepared to leave Section 9 over, and I invite Deputies to produce whatever proposals they think are reasonable for the constitution of the tribunal. I am prepared to stand over the one in the Bill if there is opposition to it. I do not want a very elaborate provision, but if wo do put into the Bill, as the Government decided must go into the Bill, a provision which will involve the loss of pension rights in the case of a break in the continuity of service, then I think we should have this tribunal as well.
Even if it is to deal with the messenger as well as any other member of the staff.
I leave out the messenger, but as between one class of employees and another in the board's service, we should have equality of treatment.
Your salesman might cause an interruption in the generation of electricity, and I agree that he should be mulcted for that, but your salesman might also impede the board in the discharge of some of its functions. Surely that is not an offence that is on the same level as the other?
If he wants to impede the board, he can do so knowing that he risks the forfeiture of his pension rights.
It seems to be putting an important matter on the same footing as a minor matter. Causing an interruption in the generation and distribution of electricity is an important matter.
We would cause much more resentment if we tried to distinguish between one class of employee and the other.
Could they not be dealt with under the other Act to which I referred?
What exact force that section of the 1927 Act might have, has never been decided in court.
It was understood that if anybody in the employment of the Electricity Supply Board broke his contract with the Electricity Supply Board, if he were employed in the supply of electricity, he was guilty of a criminal offence.
It has got to have the result of preventing the supply of electricity. If the fireman and the boiler-man went on strike and another employee was able to keep up the supply to the boiler, they may not be liable to a penalty.
It is a breach of contract; it is not the result that is looked at as here. The community would certainly like to see essential services protected, but I think it is reducing it to a very low level to suggest that the security of such services depends on the person who drives the red van or the people who are messengers in the showrooms.
As regards the essentiality of service, and the fact that deliberate interruption should be made punishable by legal penalties, we are not changing the position taken up in the 1927 Act.
We might have a finding by the tribunal depriving an employee of pension rights although the act of which he was guilty was one for which he could be proceeded against under the criminal law.
It is possible that a man would go on strike and put himself in the position of sacrificing his right to a pension, without being liable to a criminal prosecution.
I put the other case, a man who can be paraded for a criminal offence, and you avoid giving him a trial by sending him before this tribunal and depriving him of his pension rights.
It is the Act says his pension rights are sacrificed. The tribunal might possibly have to decide a question of fact but it is the Act that deprives him of the pension rights.
I understand that the Minister says that he will take any other tribunal?
I shall take any tribunal that looks fair on the face of it.
A tribunal with a judicial personage, or a person, say, appointed by a judicial personage——
I have certain dubiety about the wisdom of providing for appointment by a judicial personage, unless we had some provision that a list of persons with the necessary qualifications for the job would be prepared by somebody, say the Minister, and that from that list the judicial personage would pick the person he thought most impartial. I think it is much more the function of the Minister for Industry and Commerce than the President of the High Court to know the type of qualifications which a person should have for a job of this kind, and what persons in the country are likely to have those qualifications. I do not think the matter is of any great importance.
The tribunal would have to decide whether any wilful action on the part of such worker "caused, or might have caused, an interruption in the generation, transmission or distribution of electricity by the board".
The tribunal has much more than that to do.
But it has to do that.
Its main function will be to arbitrate in ordinary industrial disputes.
Leave that aside for the present. All I am concerned with at the moment is to see that the tribunal would have a judicial character when it comes to decide the matter we are speaking of.
The only thing I can say is that I am not tied down to the tribunal in Section 9 at all.
I move amendment No. 26:—
In sub-section (2), paragraph (c), page 6, to delete all from the word "remain" in line 30, to the words "shall not" in line 31.
I intended by this to ask that the money would be paid to him—his own contributions—but that he would not, get a pension. Leave it that it will remain in the fund.
That is provided for— that the contributions paid will remain in the fund.
I move amendment No. 27:—
In sub-section (3), page 6, to delete all from the words "who are" in line 41, down to the words "of the scheme" in line 42.
This is the same point as one which I urged on an earlier section. If this phrase which I desire to have taken out remains in, the superannuation schemes can apply only to those who are in the employment of the board at the date of confirmation of the scheme. It is especially in connection with those arrears of payments that the case I referred to before may arise, and the Minister said he would look into it.
I will, certainly. The Deputy is now referring to persons whose services have terminated?
Yes. I am referring to people who have left voluntarily; people who have left to get married or for other purposes.
I will look into that problem certainly.
I move amendment No. 29:—
In sub-section (3), page 6, to delete all words from and including the word "and" in line 45 down to the end of paragraph (b), line 64, and to substitute the words "the date of the confirmation of the scheme".
This is the same point about people who have already been in the service of the board and who have terminated their employment.
It is a bit more. What I want to ensure is that superannuation schemes shall contain provisions enabling persons already in the svrvice of the board to include in the service reckonable for superannuation benefits service in the employment of the board prior to the date of tho confirmation of the scheme. I simply want to get out those two paragraphs, which entail on the people already in the service of the board the payment of the appropriate contributions of compound interest, or else that they would be entitled to reckon only one half of their service. I want to leave that out so that the board can make its own scheme freely on this point. I want to leave this thing loosely worded, so that the board will not be tied to those equal contributions for the back service, with the alternative that they simply add half a year for each year.
We discussed that before. I cannot agree to modification of that. We must keep this principle intact, I think, having regard to the general considerations I have described already which have governed our attitude on this Bill. I think it is not ungenerous to provide that a person with previous service with the board need not, if he likes, pay any contribution in respect of that service, and still get a pension for it, a pension which will be secured to him by reason of an obligation placed on the board to pay into the fund its contribution in respect of that previous service. I am not prepared to ensure that the whole of that contribution or any more than 50 per cent. of the appropriate contribution, will be paid by the board.
The only comparison I can make then is with the old Act of 1922 in England to which I have already referred. I understand that the board had a scheme which they presented to their pensions committee. This is not a matter on which I can speak with certainty, because I have not the calculations. The scheme aimed at giving, after a certain minimum period of service, ending at about 60 or 65, 50 per cent. of the salary, plus a year's gratuity. It aimed at giving lesser rates for a person retiring before the 65 period on grounds of ill-health or voluntary retirement. It aimed at giving people who retired on marriage their full contributions paid into the fund, or a year's salary, whichever was the greater. It aimed at giving people who left the board not exactly through misconduct but under, say, a bit of a cloud, repayment of the contributions to the fund with interest, and it was possible to do all that on a 5 per cent. contribution from the employee and an equivalent contribution from the board, leaving out the payment for the years of service already in; the board would bear to the full extent the back years' service. I gave examples the other day showing that certain persons would have to pay as much as 20 per cent. of their salaries. I believe a calculation has been made that no employee of the board will get off with anything less than 6 per cent., even the lower-paid people, if they want to qualify under this arrears of service section. I think that is an amazing change from the scheme to which I have referred. I am speaking now entirely from hearsay, and have not seen the figures, but I am told that that is the pensions scheme which the board had thought of, and which had been found to be actuarially sound. People who in 1927 certainly thought they had superannuation coming to them now find that they are being asked to pay back with compound interest whatever is found to be their proper contribution. It comes to this, that the majority of them will not do it. Then another consideration occurs. People who went into the service of the board at 25 or 30 years of age, and are now 40 or 45 years, will wonder whether, if they pay only from now on for the 20 odd years of remaining service, they will get those benefits, or whether they wih find that what they are likely to get is so whittled down that it would scarcely be worth their while going into the scheme at all. The whole matter can easily be adjusted by what would not be more than a possible obligation on the fund of £10,000 a year over a certain number of years, and this obligation will never arise again. I think the Minister might meet me on this point.
It can never arise again in the service of the Electricity Supply Board, but it can arise in respect of every pension fund established for every industry.
If it can be as easily met as it can be by an obligation representing 5 per cent. of the revenue of the concern, it will not be a very difficult matter.
In the case of the Great Southern Railways it would take a large part of the available capital of the company.
Is it because of that that we must do nothing else in any other case?
I do think we should avoid making the mistake of fixing a precedent now in relation to the Electricity Supply Board scheme, because of the fortunate situation in which the Electricity Supply Board is which will make it impossible for us to establish a similar scheme for any other public company or large industry. If we set the standards too high now, we are going to arrest progress rather than facilitate it.
On that basis, the better-run industries in this country and across-Channel would be perfectly justified in saying: "No; we must scale down rather than up. Even though the company is prosperous, we must remember our weaker brethren and the less strong vessels."
We are doing all that the industrial companies of England have done. This scheme is as generous as any of theirs.
The only one the Minister has been able to produce is the London, Midland and Scottish.
J.S. Fry and Sons, Limited.
I should like to hear of a public utility.
There is also Messrs. Cadbury Brothers.
A public utility.
I said large industrial concerns. The London, Midland and Scottish is one public utility.
Not particularly prosperous.
Not, as prosperous as some of the others, but more prosperous than the Electricity Supply Board.
How are its ordinary shares on the market?
It is at least as prosperous as the Electricity Supply Board.
I do not think it is.
If there were ordinary shares, they would be at par, while the others are at a very considerable discount.
This was flaunted to the public as being the greatest asset any country ever had when the Minister for Finance was looking for his last loan.
The elephant is becoming gold.
Some other argument ought to be put up. That is a bad argument and nobody knows that better than the Minister.
I know that we can undoubtedly say: "Here is an undertaking which has a monopoly. It can charge anything it likes for electricity and pay any pensions it likes. We know that it will not go burst because, if necessary, we can, increase the charge for electricity and there is no competitor"; but if we take that line, that will be the end of this development. We can have regard to the general circumstances of the public services and the pensions payable to public servants and of other public utility companies not in this happy position—other industrial concerns might want to adopt an analogous scheme for their staffs— and say: "We will have regard to all these and ensure that the Electricity Supply Board scheme is a reasonable scheme which will not involve any undue strain on the Electricity Supply Board revenue which some other undertaking could not undertake." I say that we are doing well enough for them when we take the general run of pension fund schemes established by other big enterprises just as large as this and with a revenue equal to that which the Electricity Supply Board has when we say that we will be as generous as they are. In some respects, we are more generous.
I think it is a mistake to try to do too much. In any event, all we are doing is putting these limitations on the board. If they find that their fund is accumulating assets, they can increase the benefits or decrease the contributions, as they like. It is a matter of experiment for some years, because clearly any calculation as to the contribution that will enable a particular pension to be paid must be subject to the test of time. It might prove to be right or wrong. If the fund produces a surplus, there could be an improvement in the position; on the other hand, if the fund produces a deficit, as other funds have done, there will have to be a modification of this position.
Did Messrs. Cadbury, or any of the other firms the Minister mentioned, indicate at any particular stage of their career that they were going to have that pension scheme, stop all proceedings in connection with it for a period of 15 years and then bring in a scheme as generous as this?
Everybody who wants to start contributory pension schemes must deal with this problem of the person who has been in for a number of years and who is now 45 or 50 years of age. That is the whole problem of all these schemes. If we were satisfied merely with having pension schemes applicable to new entrants and not covering old employees, we could draw up very attractive schemes involving low contributions and high pensions. In the case of the Great Southern Railway the problem was made impossible of solution by reason of the fact that the average age of the existing employees was so high that none could afford lo pay the contribution that would bring a pension worth while, and the whole fund could not be made to work at all without a heavy subsidy, which was not possible in the circumstances. Clearly, if you start at the beginning of an organisation, with all the members new in the service and young in years, you will produce a much more attractive scheme than you will when dealing with an old organisation with a high proportion of elderly employees.
Only one example has been quoted to the House of a body which faced this difficulty. It is the local officers' superannuation scheme in England in 1922. They set out a 5 per cent. contribution as a maximum from the employees and an equal contribution from the local authorities, but the local authorities are to bear the burden of the arrears. That is an example of something which corresponds to a public utility. The Minister said that this was a concern which has a monopoly, which might raise its prices and which could not "go burst". That is very extravagant language to use about these people. They have done nothing like that. Think of what they have done. They have put on them, according to the Banking Commission Report, a burden such as no public company can have, by law, in England. These people have put on them, according to Professor Duncan in the Banking Commission Report, an obligation which no company in England, by law, could carry, and which no public utility known in England or here is carrying. They both remunerate the capital and renew the plant. That obligation is put on them and they are facing up to it and are in process of carrying it out. They further employ a couple of thousand people and distribute £750,000 in salaries free from any inter-position from this Minister or the Minister for Finance.
We are now approaching a pension scheme for these people. They have given good service to the people and their charges are not, in the main, complained of. I think it is only those people who have no appreciation of what electricity charges used to be in this country who at all venture to complain. That is the reality of the situation and not the hypothetical talk about the people who might say: "We are a monopoly and we can increase our charges." The reverse situation is what they have achieved, but nobody has complained that they have set too high a standard in the wages they have paid. When it comes to this pension matter, the crux of it is that there might be an addition of £10,000 a year for a limited number of years. The board's revenue at the moment is £2,000,000 and the £10,000 represents .5 per cent. of that revenue. There is no question of their being unable to bear it, and it would make the pension scheme a reasonably decent matter, instead of something which will cause disquiet and annoyance through the years.
I move amendment No. 30:—
In lines 49-50, 51-52 and 59-60, sub-section (3), to delete the words and brackets "(with compound interest)".
Do not ask them to pay their back money with compound interest.
How otherwise will we make up the fund? We have to put the fund in the position that it would be in if the pension scheme had been in existence from the time the employees started their service.
You could make up the fund by allowing the board to pay the little bit extra. The equal contribution must stand although there is no reason for it except that some unnamed public utility undertaking may adopt this as a model hereafter.
If they did not pay the compound interest and the board had to do so, would it seriously affect its finances?
No.
Possibly to the amount of £1,500.
If we liked we could undoubtedly give away the whole revenue of the State.
That does not arise now.
We could give away all the revenue of the Electricity Supply Board to somebody, if we liked.
You cannot do that— do not talk nonsense.
I thought this was a sovereign Assembly. I believe we could even do that.
I suggest it ought to be the board. The board does everything—recruits its staff and pays them.
On this section a variety of matters has to be looked into.
May I take it that the section is agreed to?
It is not agreed to.
I move amendment No. 31:—
In sub-section (1), to delete all words from and including the words "the Minister may" in line 17 down to and including the word "Finance" in line 19, and to substitute therefor the words "the board may (subject to the provisions of this section)".
I, previously, on an earlier section, dealt with this matter of the regulations being made by the Minister instead of by the board. This is the other side of it. Seeing that the scheme will have to be criticised and passed by two Ministers, I suggest that once it has been passed, the making of regulations concerning these matters might be left to the board instead of to the Minister.
Once we have decided upon the principle of a statutory fund at all, these regulations must be made by the Minister concerned, and not by the board, and I do not think it is unreasonable, in the circumstances, that these powers should be left with the Minister. The State has invested a large sum of money in the electricity supply undertaking, and the Minister for Finance, in particular. I think, has a right to be consulted in any matters which may affect the revenue of the board. If we had decided merely to empower the board to pay any pensions they liked, and left it at that, without any statutory obligations as to the form of the pensions scheme at all, this would not arise, but now that we have a statutory fund I think this power should be exercised by the Minister.
Is it to be argued that the board are not fit to make these regulations?
No. That is not the question.
Let us have it decided that any scheme they set up has to be approved of by two Ministers, and let us agree further that there are statutory obligations on them in regard to the scheme, such as that it must be on the basis of equal contributions, the number of years' service, and so on— let us take it that all that is decided upon and that we are now on the question of the fund. There is a scheme which has to be passed and approved by two Ministers, and that goes back to the board. Are the board not to be trusted to make their own regulations, providing for the setting-up of the fund, for the investment of the fund, for the appointment of trustees, and so on? Is that something that the board is incompetent to do?
No. There is no question of their competence. These will be regulations binding on the governing body of the superannuation fund.
Can the board not establish their own trustees?
They could.
Very good, they are not incapable of doing that, and could they not provide for the administration of a superannuation fund? They certainly can; they are not incapable of doing it. What is the necessary connection between the State and the fund that the board has to set up?
We have decided on the principle of a statutory fund—that is, the superannuation fund to be set up under this statute—and, that being so, there devolves upon the State the obligation of ensuring that the management of the fund is sound and that proper regulations are made for the appointment of trustees, the investment of the fund, and so on. I do not think the Ministers should divest themselves of control over these matters.
Sub-section (2) deals with the investment of the moneys in the fund, and another sub-section provides for loans to the board, but apart from that, which is a statutory obligation, is it not possible for the board themselves to be allowed to make their own regulations with regard to these other matters? I know very well that the Departmental mind is horrified at the thought of the board being set loose at all, but what on earth is the reason for having the Minister make these regulations?
We are in the position of being the shareholders of this company and, as shareholders, we propose to make regulations which will be binding upon the executive body that is to be established for this particular purpose. I do not think it is an undue retention of power at all, in the circumstances, that we decide to have a fund that will be under our supervision and control.
As a matter of fact, you are not shareholders at all.
Well, we act in loco parentis.
In loco parentis? I thought this body was to be one that would be quite emancipated from parental control under the Act of 1927.
The shareholders have abandoned control of this in connection with 19/20 ths of it and when it comes to the 1/20 th part, the Minister must grab it.
I move amendment No. 32:—
In sub-section (1), page 7, line 30, before paragraph (d) to insert a new paragraph as follows:—
(d) prescribing the notice to be given by such trustees to the board or by the board to such trustees in respect of the repayment of moneys lent under this section by such trustees to the board.
This amendment and amendment No. 34 hang together. The Bill as it stands requires that three months' notice be given for repayment of moneys lent by the trustees to the board. We are providing that the notice be given by regulation, so as to provide a more flexible means and for modifying from time to time the period of notice.
The Minister has not swaddling clothes ready for the board?
The Deputy could not make that part of this amendment.
The Minister is going to make the period of notice governed by a regulation.
The Bill provides for three months' notice, and the amendment provides for modification.
And the whole creaking joints of the Civil Service must move to do that.
This will take a few creaks out of it.
I move amendment No. 33:—
In sub-section (3) (a), lines 54-55, to delete the words "with the consent of the Minister for Finance".
Again, when it comes to paying the interest, we have the stereotyped phrase "at such rate as shall from time to time be agreed upon... with the consent of the Minister for finance". Why?
I think it rightly comes in here. If it were in some other place I might agree that the Minister for Finance comes in far too often, but it seems justifiable here.
It is provided here in cases where the board is borrowing from the trustees.
To fix the rate of interest.
And the Minister for Finance must bend his mighty intellect to tell the trustees the rate of interest?
Yes.
The Minister would not trust the trustees with that?
The exercise of control in a matter of this kind is necessary.
Where is the repercussion on public funds or on ths duties of the Minister for Finance? This superannuation scheme is established. It is in funds and the trustees of the fund may lend to the board and the board may borrow from the trustees out of the fund. You have the two parties there at arms' length—the board and the trustees—to come to agreement on the rate of interest. Apparently, they cannot be allowed to have their say, but the Minister for Finance must come into it.
There is a great case for giving the Minister for Finance powers to control rates of interest in far wider fields than that.
Give us the reasons.
The Minister for Finance is responsible for finding capital for development purposes and fixing the rate of interest. The board is being given the alternative of getting the capital by loan from the trustees. It obviously affects the finances of the pensions scheme and the finances of the board, if they pay too much or too little, when they borrow in this way. Having regard to the obligation on the Minister for Finance to supervise the general capital finances of the board, he should be consulted. It is a question of fixing the rate of interest to be charged upon loans to be made to the board.
The Minister has successfully wrapped up the real aim.
At the moment, the Minister borrows from the public at a certain rate of interest and lends to the public at a higher rate and makes a bit. What is contemplated here is that the superannuation fund may come to such a point that the board would like to borrow from the fund instead of from the Minister. Then the Minister for Finance is going to step in and see that they pay his exorbitant rate. The alternative before the board may be to subsidise the fund instead of paying a higher rate of interest.
Those circumstances are least likely to occur. It must not be supposed that the governing body of the fund and the board are two entirely separate and antagonistic bodies. The governing body of the fund will be the board in another form.
The Minister may be borrowing from the public at a lower rate than at which he lends to the board and may be making a bit on the transaction. If the board were allowed to go to the public to look for a loan they may get it at a lower rate of interest. The Minister is charging them more than administration expenses.
That is questionable.
The fund may become so big that they may be able to supply the money out of it. The board's capital has been developing at the rate of £1,000,000 per year. The present capital, after 16 years, is about £14,000,000. The Minister is afraid that the fund may lend at a lower rate of interest than the Minister can get from them.
If the fund lends at a lower rate of interest, the finances of the scheme are upset.
That is what the trustees are expected to look after. I am all the time thinking that the Minister is not intending to put in a lot of juveniles as trustees, but adults of intelligence and financial probity, to look after this. The Minister wants to be able to get his whack from the board and not allow the trustees to lend at what may be remunerative but not exorbitant rates.
This seems rather strange, in view of the Minister's declared object to keep control of the rate of interest. The paragraph, as drafted, will enable the board, by not consenting to the Minister for Finance, to get a loan without interest. The section says: "At such rate as shall from time to time be agreed upon... with the consent of the Minister for Finance."
I think there is a point there. Whether the board must get the consent of the Minister before or after is not quite clear.
It is clear from the Minister's statement of a short time ago that there is the possibility of a situation arising where the interest will not be sufficient or where it would be too much for the board to pay. What is the corrective?
The corrective is that the Minister for Finance will have to consent to the rate of interest.
That is no corrective and does not put it right. What is to happen if the money in this fund is insufficient to produce the sums necessary to pay the superannuation charges?
The rates of contribution will be increased or the rates of benefit decreased, if the fund becomes insolvent.
It will not be insolvent, but may not be able to meet all its obligations. It may not have money to invest at sufficiently high rates of interest. There is no corrective in the Bill for that situation.
That will have to be in the scheme for the fund itself.
Secondly, there may be too much in it, and there is no corrective for that.
Not in the Bill, but that presumably will be in the scheme.
In the scheme it may be found, but it is not right one way or the other. In that situation I do not see the use of the Minister for Finance. All this dragging in of Ministers to sanction this and that is the greatest nonsense, and is bringing administration into disrepute. I have never known a case in which a proposition has been put up to the Minister in the last ten years in which it has not taken days, weeks or months to get the necessary sanction. I know one case of a dispensary doctor, where it took the Minister 12 months to make up his mind as to what pension he was to get. A boy leaving school could have made it up. That is what the Minister for Finance and the Civil Service are bringing this country to. As far as this is concerned, the case made for the Minister for Finance coming in here is just humbug. He can serve no useful purpose. If the trustees are sensible people and the board a sensible board there is no necessity in the world for bringing in an outsider, and it simply means a waste of time.
The alternative is to prescribe the rate of interest.
You cannot do that.
It is done in numerous pensions schemes, even in the case of the Great Southern Railways, where it was contemplated that the fund might lend to the board. It is not obligatory on the trustees to lend to the board at all. They can invest in any particular class of securities which are prescribed, but they must not lend to the board at a lower rate or at a higher rate than the board could obtain outside. The alternative to such control is for the Minister to put in the Bill the rate—4 per cent. or 4½ per cent., say—at which the fund may lend to the board, but I think that it is better to have it flexible.
The situation may arise where money may be cheaper than it is. It is very cheap in England. No one expected ten or 15 years ago— and from ten years ago back down through the ages—that money would be lent at such a low rate of interest. If the board can borrow at such a rate, the Minister wants to provide that this fund will get a higher rate of interest than that obtainable outside.
The trustees would be neglecting their duty if they lent to the board at a lower rate than that obtainable elsewhere.
Assuming that they can get 2 per cent. and that this requires 4 per cent., why bring the Minister for Finance into it? Surely, these two bodies—the trustees and the board—themselves can decide on that question. It is a liability of the concern, if it is based on 4 per cent. Bringing in the Minister for Finance will probably mean that the question must be raised and there will have to be the Minister's sanction and you have all this political turmoil over nothing. It is humbug.
I think the meaning of this is to have the Minister for Finance in a position to prevent the trustees failing in their duty.
The primary obligation is on the trustees and the board if any such action is contemplated, but the Minister for Finance is entitled to sanction or refuse to sanction the transaction. There is a lot to be said for giving the Minister for Finance control of interest rates in a much wider field.
Why should you give it in this particular case?
Because the Minister for Finance is responsible for all the capital finances of the board and for the loans put on the market.
Do you remember the way he raised his last loan, by parading this as the biggest asset the State had?
My only reason is that if the board is able to borrow at 2 per cent. they can pay 4 per cent. here.
Is it not an amazing thing that a book has been written about herrenvolk by a man who did not know anything about finance?
I move amendment No. 34:—
In sub-section (3), paragraph (b), page 7, lines 56 and 57, to delete the words "three months' notice given in writing" and to substitute the words "such notice", and in line 58, after the word "trustees" to add the words "as shall be prescribed by regulations made by the Minister under this section".
Perhaps we might leave consideration of Section 9 for the Report Stage until we see the line the amendments take.
I was interested in the particular functions of the tribunal, and thought it should be presided over by a judicial person, but the Minister stated that it would have other functions to determine. As far as I am concerned I would consider insisting that the chairman of the tribunal ought to be somebody with judicial experience and judicial training. When it goes outside to other matters I am less interested. When it comes to determine matters that might lead to the forfeiture of pension rights that ought to be a question for judicial determination.
I gather that the Labour Party may have some proposals to make. I understood from the Trade Union Congress that they have some proposals. I told them that as far as the composition of the tribunal goes I am not very much concerned, so long as it is an impartial body, and can be relied upon to be impartial in the different disputes. They may have some proposals to make on the next stage.
This is a marvellous section. It allows the tribunal to do its own work. Once it starts I do not think anyone comes in except the tribunal. It is an amazing exception to the run of the measure.
I wish to say that the representatives of the Trade Union Congress expressed certain objection to the form of the section as it stands, the objection to a manual worker being required to sign, on entering the pension scheme, that any dispute should be submitted to the arbitration tribunal. The main reason for the section as it stands is that I think it desirable to bring to the notice of manual workers in a personal way that besides participating in the scheme there is an obligation attached. I would be prepared to produce an amendment which would require the board to notify each of the manual workers that this set of circumstances was associated with their membership of the fund. It is not of importance what way it is done, but I think it is desirable that the individual worker who is about to become a member should understand what the consequences of membership are, and that there is an obligation on the board or someone to ensure that he is so notified.
That is to say that he is made aware of Section 7.
Certainly.
What you are doing is recognising that he must be given notice oi Section 7 and to join in referring any dispute to the tribunal.
It is the same thing in another way.
I move amendmunt No. 39:—
Before Section 13, page 10, to insert a new section aa follows:—
(1) In this section—
the expression "excluded person" means a person employed by the board who was transferred to the service of the board under sub-section (9) of Section 39 of the Principal Act and has, by virtue of such transfer, a right to superannuation benefits payable by the board and in respect of whom it is provided by this Act that no superannuation scheme shall apply to or enable superannuation benefits thereunder to be received by him;
the expression "appropriate superannuation scheme" means, in relation to an excluded person, the superannuation scheme which would apply to him if he were not an excluded person.
(2) Any excluded person may, by application in writing made to the board not later than one month after the confirmation by the Minister of the appropriate superannuation scheme, elect to be deemed to have surrendered the superannuation benefits to which he is entitled by virtue of his transfer to the service of the board and to be entitled in lieu thereof to receive from the board the like superannuation benefits as those which he would be entitled to receive under the appropriate superannuation scheme if that scheme applied to him.
(3) The following provisions shall apply and have effect in relation to every excluded person who makes to the board, within the time limited by the next preceding sub-section of this section, such application as is mentioned in that sub-section, that is to say:—
(a) such excluded person shall not be entitled to receive any of the superannuation benefits to which he was entitled by virtue of his transfer to the service of the board;
(b) such person shall be entitled to receive from the board the like superannuation benefits as those which he would be entitled to receive under the appropriate superannuation scheme if that scheme applied to him;
(c) such person shall be entitled to reckon for the purposes of the superannuation benefits to which he is entitled under the next preceding paragraph of this sub-section the same number of years of continuous service as he would have been entitled to reckon for the purposes of the superannuation benefits to which he would have been entitled if he had not made the said application to the board but subject to the provisions of the appropriate superannuation scheme in relation to the calculation of continuous service;
(d) notwithstanding anything contained in the next preceding paragraph of this section, such person shall not be entitled to receive, in respect of any particular benefit, any greater amount than the maximum amount fixed by the appropriate superannuation scheme in respect of that benefit;
(e) for the purpose of calculating the superannuation benefits to which such person would have been entitled under the appropriate superannuation scheme if that scheme had applied to him, there shall be deemed to have been duly paid by or in respect of him the contributions appropriate under the said scheme to the number of years of service which he is entitled under this sub-section to reckon;
(f) subject to the foregoing provisions of this sub-section, the provisions of the appropriate superannuation scheme and of this Act shall apply and have effect in relation to such person in like manner in all respects as if such scheme applied to him.
(4) Where the appropriate superannuation scheme in respect of an excluded person is the manual workers superannuation scheme, an application under this section by such person to the board shall be void and of no effect unless it is accompanied by a declaration, signed by such person, to the same effect as the declaration the deposit of which with the board is made by this Act a condition precedent to the payment of contributions and the receipt of superannuation benefits under the manual workers superannuation scheme.
(5) All superannuation benefits which an excluded person becomes entitled under this section to receive from the board shall be paid by the board as part of its general expenses.
(6) Every dispute which shall arise between the board and an excluded person (including a person claiming to be an excluded person) in relation to this section or any of the provisions thereof shall, at the request of the board or of such person be referred to and determined by the tribunal, and the decision of the tribunal thereon shall be final and binding on the board and on such person.
I told the Dáil on the Second Reading that I proposed to bring forward an amendment to enable officers transferred to the service of the board with pension rights to exercise a choice whether they would retain the existing rights or elect to come under this scheme. The main purpose of the scheme was to ensure that existing officers will be given that choice of continuing to exercise their pension rights or to come under the board's scheme.
I do not know if this is the section, but there is a group of officials at the Pigeon House to which I want to call attention. Are these people in this Bill?
No.
I have been asked to inquire where they are dealt with.
They are not here, but they will be dealt with in another Bill which I will bring in to deal with number of minor matters.
These are men at the Pigeon House who, more or less, were dismissed and then taken back.
Exactly.
I move amendment No. 40:—
Before Section 14 to insert a new section as follows:—
In computing for the purpose of this Act the service of a person who is in the service of the board at the date of the passing of this Act and who is a person entitled to superannuation benefits under this Act the board may add to the period of service reckonable for such benefits, such period, not exceeding ten years as the board shall think proper having regard to the age, length of service and other special and relevant circumstances of such person but subject always to the proviso that the pension payable to such person shall not by reason of such added period of service exceed the maximum pension payable under the appropriate part of the scheme.
I notice that a note here states that acceptance of this amendment means the destruction of Section 14, although I think the two should run together. Section 14 is tied to this, in that it only applies to anybody precluded on the ground of ill-health from paying contributions and receiving a pension under the superannuation scheme That brings up another consideration. Take the position of some people in the service of the board who find that they cannot pay contributions because of bad health. They may say that the bad health was brought about by over work or something associated with service in the board, I do not know if there is any provision like that in the superannuation scheme which precludes people paying contributions on the ground of ill-health. In other words, you refuse them admission because there is a bad medical certificate. This is to apply not only to new entrants but to people already in the service. As the Bill stands if these people want to get the full value for the years they have served, they must make a heavy contribution. The section does say that they get one year counted for every two years of service. I suggest as an alternative, that the board should take into consideration special circumstances and qualifications and that there might be certain added years. The period is limited in this way: "the board may add to the period of service reckonable for such benefits, such period, not exceeding ten years, as the board shall think proper having regard to the age, length of service and other special and relevant circumstances." There is super-added a proviso that, even adding the years, nobody can get more than the pension that would have been payable to him if he had subscribed right along the line. It is another way of meeting a certain section, but nothing like a majority, of the people in the service of the board. It is to meet the case of higher-paid employees who are going to get full benefit but who will have to pay up to 20 per cent. of their salaries. I think that would be intolerable on present salaries.
It is the same thing as saying that the board should pay more than an equal contribution.
"That the board should have regard to age, length of service and other special and relevant circumstances." They could not pay it to all and sundry who already have service.
I take it that the Deputy does not mean this to be in lieu of Section 14.
I did not put it down as such.
I was not sure what was meant.
I was not too sure that it would not have in some way cut across what was meant in Section 14. I can see some people who are in, and who would fall under heavy penalties in the earlier section, who might creep out under this, but only if they are broken down in health by reason of their activities in the service. I frankly admit that this is another way of easing the situation of people already in the service of the board at high rates of pay and who, if the Bill stands in its present form, will have to pay a very high proportion of their salaries to get the full years of service reckoned for pension. It is going to be permissible for the board to give added years in respect of certain people. I put down the phrase as it occurred to me. There are two other limitations, that it only applies to people in the employment of the board and will not apply to new entrants. These are the two overriding conditions. Ten is the highest number of added years, and no case can be made to bring pensions higher than the appropriate pensions if persons paid all along the line.
Merely adding years does not get anywhere unless there are contributions to the fund in respect of added years.
This is a way up to the added years. I tried to achieve it on amendment No. 7 and in another amendment. This will not be as widespread in effect as the other amendment. This means that the board would have the special circumstances brought under consideration when giving, added years. It adds years without contributions. That is the purpose.
I would be glad if the Deputy would leave this amendment over. I am somewhat confused about the interpretation of the Deputy's meaning in view of the fact that it appears to be a substitute for Section 14, which enabled the board to pay gratuities.
That is only on the ground of ill-health.
Will the Deputy agree to let it stand over?
Certainly. It probably should come in at an earlier stage.
