Miscellaneous

Part of the debate – in the House of Commons am 4:30 pm ar 6 Chwefror 2024.

Danfonwch hysbysiad imi am ddadleuon fel hyn

Photo of Bill Esterson Bill Esterson Shadow Minister (Transport) 4:30, 6 Chwefror 2024

I think the best that can be said for the previous speaker, Anna Firth, was that she spent six minutes and 50 seconds speaking about anything but the motion and then the last 10 seconds on severance pay. I am sure other than that she is a delightful Member of the House, but on this occasion I am afraid she did not really get there.

In supporting the motion today, I want to highlight a trio of payments that were made during the chaotic period in the autumn of 2022, which capture the essence of why the rules on ministerial severance were brought into disrepute during that period and how reforms can fix the problem. It is impossible to make those points without speaking about individual cases, as my right hon. Friend Emily Thornberry said from the Front Bench, and I have informed two Members that I will be discussing the payments given to them as examples of what happened.

If we cast our minds back to September 2022, colleagues will remember that in the earlier days of the premiership of Elizabeth Truss there was some turmoil in her Whips operation. Mind you, the early days were swiftly followed by the middle days, and the final days were not very far behind—and it is fair to say there was turmoil all the way through. Anyway, in those early days, three assistant Whips were sacked and three more put in their place. The appointments were made three days before the mini-Budget and they lasted just 38 days, until the right hon. Member left Downing Street.

The three assistant Whips spent almost their entire time in office propping up a doomed regime while it continued to do huge damage to the country—damage for which my constituents are still paying the price in the shape of crippling mortgage payments. In those circumstances, we might have thought that those who were appointed by the right hon. Member for South West Norfolk would have walked away from their brief time in office feeling some measure of contrition, perhaps even shame, at the role they had played in that disastrous Administration, and wanting only to apologise to their constituents for what they had done.

Instead, unbelievably, each of the three assistant Whips walked away with three months of severance pay—a £4,479 handout from the taxpayer—after just 38 days’ work. They received two and a half times more in severance pay than they were paid in salary during those 38 days. At the same time, a number of departmental Ministers received £5,593 in severance pay, compared with £2,248 for their salary in five and a bit weeks as Ministers. All that happened at a time when people all round the country were struggling to put food on the table, to fill up their car and to pay their bills in the face of a cost of living crisis that those Ministers’ time in office had just made substantially worse.

Average growth in the UK has been 1.5%, compared with the 2% when Labour was in office between 1997 and 2010. That lower growth has meant £150 billion less in GDP, £40 billion less in tax revenues for public services and infrastructure and £10,000 a year less on average per household for each of those years, across the UK. Those are the figures—the price of failure of 14 years of Conservative government. When the right hon. Member for South West Norfolk crashed the economy through her reckless, unfunded mini-Budget, it just turbocharged the damage done. My constituents, and all our constituents, are still living with the consequences of what the then Chancellor, Kwasi Kwarteng, dismissively referred to as “turbulence”, in the form of higher food prices and mortgage payments.

The premium for economic failure, which was created when the right hon. Members for South West Norfolk and for Spelthorne crashed the economy, is still priced into markets today, and private investment in the UK is still at a record low. The scale of severance payments as reward for being part of that disastrous mismanagement of the economy is nothing short of disgraceful. However, it does serves one purpose at least: it makes the case for reform indisputable. It is a shame that the Minister chose not to engage with the substantive point about the severance payment system having been shown not to be fit for purpose as a result of what happened in 2022.

Under Labour’s proposals, the three assistant Whips would have received not a quarter of their annual salary, but a quarter of their actual earnings, reducing their severance payments from £4,479 to £454, which is almost a tenth of what they originally received and a much fairer and more sensible amount. Damien Moore was at pains to point out in his recent comments to the Liverpool Echo that the payment he received was an automatic entitlement—in other words, he was just following the rules as they stand. The £4,479 that he received—compared with the £454 that would have been due had the legislation referred to on the Order Paper been in place—really says it all. Katherine Fletcher made a similar defence to the Lancashire Post, to which she said that severance payments

“are governed by Acts of Parliament”.

Our proposal would have seen her severance payment down from £5,593 to £562, which is much more proportionate to her time served.

I am more than happy with what both Members said in public, but I hope that they accept that in no other job would the severance payments from which they benefited be allowed. That was among the questions that the Minister did not address—in what other job is full severance pay available from day one in that way, or in the event of gross misconduct? Those are the reasons why the measures proposed by my right hon. Friend the Member for Islington South and Finsbury are so important.

The good news is that Conservative Members, including the beneficiaries of excessive payments, have the opportunity to make amends today.