Allowances to Members of the
Assembly and Office Holders Bill
(NIA Bill 2/99)

Printed in support of Report 2/99 (Committee for Finance and Personnel)

Allowances to Members of the Assembly and Office Holders Bill (NIA Bill 2/99)

1. Finance and Personnel - Minutes of Evidence given before the Committee for Finance and Personnel on 12 and 27 January 2000 [Part 1., in support of Report 2/99 (Committee for Finance and Personnel), Report on the Allowances to Members of the Assembly and Office Holders Bill (NIA Bill 2/99)] to be printed [Francie Molloy, Chairman].

2. Minutes of Proceedings of the Committee for Finance and Personnel for 12, 19, 27 January and 3 February 2000 [Part2., in support of Report 2/99 (Committee for Finance and Personnel) Report on the Allowances to Members of the Assembly and Office Holders Bill (NIA Bill 2/99)] to be printed [Francie Molloy, Chairman].

PART 1.

MINUTES OF EVIDENCE RELATING TO THE
ALLOWANCES TO MEMBERS OF THE ASSEMBLY
AND OFFICE HOLDERS BILL (NIA BILL 2/99)

• Mr Francie Molloy (Chair)
• Mr James Leslie (Deputy Chair)
• Mr William Bell
• Mr Seamus Close
• Mr John Dallat
• Mr Oliver Gibson
• Mr Gardiner Kane
• Mr Donovan McCelland
• Mr Alex Maskey
• Mr Peter Weir

3. The following witnesses were present to give evidence on behalf of the Northern Ireland Assembly Commission:

• Mr John Fee MLA, sponsor of the Bill;
• Mr Tom Evans, Clerk to the Commission;
• Mr Dennis Millar, Director of Finance and Personnel;
• Mr Gerry Cosgrave, Head of Administration;
• Mr Percy Johnston, Legal Advisor, NI Assembly and
• Mr Jim Hamilton, Department of Finance and Personnel,

4. The following Members attended the meeting held on 27 January 2000 in Parliament Buildings, Stormont, Belfast:

• Mr Francie Molloy (Chair)
• Mr James Leslie (Deputy Chair)
• Mr William Bell
• Mr Seamus Close
• Mr John Dallat
• Mr Oliver Gibson
• Mr Gardiner Kane
• Mr Donovan McCelland
• Mr Alex Maskey
• Mr Peter Weir

5. The following witnesses were present to give evidence on behalf of the Northern Ireland Assembly Commission:

• Mr John Fee MLA, sponsor of the Bill;
• Mr Tom Evans, Clerk to the Commission;
• Mr Dennis Millar, Director of Finance and Personnel; and
• Mr Jim Hamilton, Department of Finance and Personnel,

6. The Committee ordered that the Minutes of Evidence be printed in support of Report 2/99 (Committee for Finance and Personnel)[i] on Thursday, 10 February 2000.

Allowances to Members of the Assembly and Office Holders Bill
(NIA Bill 2/99)

Good afternoon, Mr Fee. I would like to welcome you and your legal adviser to this meeting. This is the first public meeting during which a Bill will be launched, and I invite Mr Fee, as sponsor of the Bill, to make his introductory remarks.

Thank you very much, Mr Chairman. Despite the fact that these Bills are quite short, they are actually quite complicated.

I would like to thank all of the people who have helped get us to this stage, Tom Evans, the Clerk to the Assembly Commission, Jim Hamilton from the Department of Finance and Personnel, who has been working very hard with the Office of Legislative Council to get the Bill drafted, Dennis Millar, the Director of Finance and Personnel with the Assembly and, I am sure you all know, Gerry Cosgrave, Head of Administration and our Accounting Officer. Percy Johnston, behind us, has been seconded to the Assembly to give legal advice and to help to ensure that the Bills are competent. I believe they are, and I have made that declaration.

I will deal first with the Bill in respect of allowances. This is the first piece of primary legislation to go through the Assembly, Mr Chairman and we will take your advice throughout the afternoon on what procedures you want to follow or how you want this conducted. I will give a general overview of the first Bill, after which we will be happy to take questions or clarify matters.

The Bill passed its Second Stage on 15 December 1999, and that signified the Assembly's basic agreement to its general principles. The Bill provides for the payment of allowances to Members who leave the Assembly. This is to help them with their adjustment to what we have called non-Assembly life and to wind up their Assembly affairs. It also makes provision for the payment of an allowance to those who step down from an office-holder post to assist them to adjust to being no longer in receipt of the office-holder's element of their salary. I must emphasise that the Allowances to Members of the Assembly and Office Holders Bill (NIA Bill 2/99) is not designed to cover costs incurred by current Members of the Assembly. That is the purpose of the allowances determination which has already been presented to, and approved by, the Assembly. Nor does it deal with Members' pensions.

My colleague on the Assembly Commission, Rev Robert Coulter, will be addressing you on the Pensions Bill in the near future.

This Bill introduces four allowances. All of these allowances are available to members of the Westminster Parliament. The Senior Salaries Review Body (SSRB) recommended that similar allowances should be made available for Members of the Scottish Parliament, the Welsh Assembly and the Northern Ireland Assembly. The Assembly itself, in shadow form, took the view that in principle it should follow the SSRB recommendations on salaries, allowances and pensions. The Assembly Commission has decided that the allowances should be brought in by means of primary legislation, and as a result it has put forward this Bill.

As I said before, these allowances have been available at Westminster for some time, and similar provisions have already been made for Members of the Scottish Parliament. The principles and provisions of the Bill are therefore nothing new. The Commission has had the benefit of both the Westminster and Scottish precedents throughout the drafting process. I will briefly go through the provisions of the Bill, if I may.

The first clause and the schedule to which it refers provide for the payment of a resettlement allowance to a Member who does not stand for re-election at a general election or who is not re-elected. Effectively it is a form of severance pay. The amount of the allowance depends on the age of the Member and on his or her length of service at the date of leaving. In accordance with the SSRB recommendations, all Members will receive at least six months' salary on leaving, regardless of the length of their service.

One of the reasons for this is that unlike most employees Members can find themselves completely unemployed literally overnight, with no notice and with very little time to prepare. It is not exactly a redundancy situation so we cannot refer to it as that, but it is a quite dramatic severance and these arrangements are designed to recognise that.

In addition, those Members leaving between the ages of 50 and 69 with ten or more years' service will in most cases be entitled to more than the basic allowance, up to a maximum of one year's salary. This is in line with the arrangements for Members of the Westminster Parliament as set out in a resolution passed on 22 May 1991, which in turn followed a recommendation of what was then known as the Top Salaries Review Body.

In arriving at the current structure for resettlement grants at Westminster, the review body worked on two main principles. First, most MPs, regardless of age and length of service, are likely to be faced with some costs on leaving Parliament, which arise from the change from the parliamentary way of life. Individual circumstances vary, but it was not considered practical to devise a scheme to match personal circumstances. The review body felt that all MPs leaving the House at the time of a general election should receive at least a flat rate resettlement grant equivalent to six months' pay.

Secondly, it was recognised that additional financial assistance may be required for MPs leaving the House who need to re-establish themselves in alternative employment but who may find particular difficulties in doing so, particularly longer serving Members aged between 50 and 64, hence the stepped increases up to the maximum amount equivalent to one full year's pay. Rather than have a sudden cut-off at age 65, the review body also considered that there should be a downward taper reducing the maximum resettlement grant to a sum equivalent to six months' pay at age 70. It was their view that, beyond that, any compensation additional to the flat rate payment and to any pension entitlements would not be justified.

In determining length of service for the purposes of the schedule all service after 25 June 1998, when Members effectively took their seats, will count, even though it was before the enactment of the Bill.

In calculating the percentage of salary payable as the resettlement allowance, the salary is regarded as that determined by the Assembly for Members who are not office holders, MPs or MEPs, immediately before dissolution or, in the case of dual-mandate Members, their abated salary. This allowance is not available to a Member who resigns his or her seat before dissolution, unlike those who, for example, are defeated at a general election. A Member who resigns voluntarily in mid-term will have the opportunity to plan for leaving the Assembly and, therefore, a resettlement allowance would not be appropriate. The resettlement clause actually enacts recommendation 25 of the SSRB's report.

A paper detailing how the recommendations of the report correspond to the provisions of the Bill is available for circulation.

That will be useful.

Members may have received the report. Copies are available from the Printed Paper Office. The report is in two parts. Three of the recommendations are in SSRB Report 42, and the other one is contained in SSRB Report 43. Copies are available from the Printed Paper Office and the Library.

Clause 2 of this Bill provides for an ill-health retirement allowance at a similar level to the resettlement allowance for a Member who is under 65 years of age and who is obliged to retire from the Assembly on ill-health grounds. This is to prevent a Member who is forced to leave the Assembly during an Assembly term because of ill health being disadvantaged in relation to those leaving at dissolution. However, a Member cannot receive both a resettlement allowance and an ill-health retirement allowance. This allowance is separate and additional to the benefits in the proposed pension scheme for those Members who have satisfied the trustees of the scheme that they should be treated as retiring on ill-health grounds.

Every application for an ill-health retirement allowance must be accompanied by medical evidence, and the Assembly Commission must be satisfied that the applicant does not intend to stand for re-election, has retired as a direct consequence of ill-health and could not carry out the duties of an Assembly Member because of his or her ill health. The Commission can also require the applicant to undergo a medical examination by an independent medical examiner.

The third clause covers allowances to persons ceasing to hold certain offices, and again this clause is effectively introducing severance pay for office holders who cease to hold office. Clause 3 provides for the payment of an allowance to a Member who is under 65 years of age, who ceases to be an office holder after devolution and who does not become an office holder again within three weeks. It is designed to assist such Members to adjust to the reduction in salary, which loss of office entails. The amount of the allowance is equivalent to three months of the salary that the office holder was receiving, in excess of a Member's basic salary. It is not payable if the reason for cessation is death. Office holders qualifying for the allowance include Ministers or junior Ministers, the Presiding Officer or Deputy, members of the Assembly Commission, and such other offices as are specified in Standing Orders.

Clause 4 deals with winding-up allowances. It enacts the recommendation in paragraph 66 of the SSRB report and provides for a winding-up allowance to be paid to Members leaving the Assembly. This is to enable agreed costs, incurred after the Member leaves the Assembly in winding up his or her Assembly business, to be met.

If a Member dies, the Assembly Commission has discretion as to whom the allowance is payable. This will allow, for example, the Commission to meet the cost of the salaries of the Member's staff until his or her affairs are wound up. The allowance is not to exceed £11,617, which is one-third of the current office costs allowance, as set out in the Members' Allowances Determination of 1999. This arrangement is currently used in Westminster for MPs who are retiring, and it is entirely in line with the recommendations of the Senior Salaries Review Board.

If and when changes are made to the amount of the office cost allowance, the Assembly Commission will have the power to update the amount of the winding-up allowance. This could be achieved by means of an Order laid before the Assembly and approved by resolution of the House.

Clause 5 means that any allowances under this Bill will be paid by the Assembly Commission.

It is very difficult to estimate the financial effects of the Bill because the total amount of allowances paid out will depend on the number of Members leaving the Assembly, whether at an election or because of ill health, and the number of office holders standing down from their positions. At the next election the maximum resettlement allowance payable will be equivalent to six months' annual salary, currently around £19,000, because no Members will have 10 or more years service - assuming that the next election is in 2003. The resettlement allowance will be payable, along with the agreed winding-up allowance, up to a maximum of £11,617. The potential cost to the Assembly, for each Member who is not coming back, could be up to £30,000.

Because the system of allowances introduced by this Bill applies equally to all Members, we do not believe that there are any equal opportunities issues arising here. Certainly, there are none that we can spot.

In conclusion, it was the Assembly Commission's view that it is a fact of life for politicians that they can suddenly find themselves out of a job. These allowances, which are available in Westminster and in Scotland - I do not know if they have been introduced yet in Wales, though they are to be - are designed to assist Members in their transition to life outside the Assembly and to assist Ministers and other office holders to adjust when they cease to hold office. The allowances do not come in to play until a Member actually leaves the Assembly, normally at an election time, or when an office holder steps down from his or her post. This may be some way off, but it was the Assembly Commission's view that legislative cover should be in place as soon as possible to meet any eventuality.

I should be happy to clarify any issue or answer any Member's questions on the Bill. If I cannot help, I am sure that Jim, who has a very detailed knowledge of the provisions of the Bill, will be able to.

Thank you for your detailed presentation.

I ask Members to be as precise with their questions as possible to give everybody an opportunity to come in.

I am particularly interested in the issue of Members retiring due to ill health. Are we being age-discriminatory? There is a perception that if you are over 65 years old, or over 70 years old, you have no real responsibility. In the new age we are living in, and particularly concerning everything you mentioned, which seemed to be 'equality-proof', can we really carry out an operation that is age-discriminatory?

Many may feel that perhaps there is a greater financial responsibility or accountability on people aged 55. However, it is assumed that people over 65 years of age have almost no responsibility, and once you are over 70 years of age you are virtually worthless.

As far as this matter is concerned, are we simply copying and adopting what is happening elsewhere in Great Britain-whilst we have said that it is equality proof-without having any regard to our own equality laws? There is an inbuilt age-discriminatory factor here and I am not too sure how we should handle it.

Finally, what effect does a Member's death have on office allowances? In those circumstances the next of kin, or someone else, would have to dispense with secretaries and offices. What provisions are there for people employed by a Member, in research for instance, if that Member suddenly dies?

I will answer the second question first. The Bill gives the Assembly Commission discretion to make payments to the most appropriate person. It has to be left as a discretionary matter because the most appropriate person could be a husband, a wife, a family member, or a member of staff who takes on the responsibility. But the winding-up allowance is available in each individual case.

But it is discretionary.

No. The Commission has discretion as to who would be the appropriate person to wind up the affairs, and who would actually get the payments. But the entitlement is not discretionary. It is there for agreed costs up to a maximum of £11,617, or such other amount as the Commission may by order specify.

The first question is probably more complicated and I will ask Mr Hamilton to comment on it also. Part of the Senior Salaries Review Body's rationale was that when people reach the state retirement age of 65 they gain an additional pension entitlement. The SSRB decided that it was difficult to justify the enhanced payments of the allowance when this additional pension entitlement becomes available.

That is correct. Once a Member becomes 65 years old and if he or she were to retire on ill-health grounds at that time a pension would be payable. The background to this may have been- without being ageist-that when someone becomes 65 years old they would be less likely to want to go back into employment.

Until May 1991 this scheme existed in Westminster without any payments or resettlement allowances for people over 65 years of age. So this is an improvement on what was previously available. However, there is a question of justification when somebody who reaches 65 years of age becomes entitled to an alternative source of income such as a pension.

Is it not the case that someone will claim discrimination if they are 66 years old, suffer a stroke or heart attack, and believe that they are being treated differently? This is age discrimination. This is a simple question.

This is in line with employment practices right across Britain and Northern Ireland, and it is tied in to the age of retirement. It is possible that a charge of ageism could be laid against the whole Bill, but as we are operating in that environment, I do not see how we can change the context here.

I mention it because you referred to the ages of 65, 60 and 50. These are arbitrary benchmarks, and I am simply drawing your attention to that.

I would just like some clarification to avoid any confusion.

Mr Fee, you decided on a winding-up allowance with a maximum payment of £11,617. I understand that that is the sum set aside to assist Members who leave office or who cease to keep their seats. I believe that the winding-up allowance is intended not so much to assist the Member but to assist the Member's staff.

If I lost my seat on 31 March, I would still have one full-time and one part-time member of staff wholly dependent on me for their income on the 1 April. I would still have a legal commitment to my landlord for three months' advance payment of rent. I would still have to pay my phone bill, the lease for the equipment, my fax bill and my office insurance among other things. All have to be paid no matter what happens on 31 March. Is the £11,617 money which has been set aside to cover those costs irrespective of the age of the Member when he/she loses his/her seat?

Yes, that is absolutely correct.

First of all, I would like to preface my remarks by saying that I know that the Assembly Commission dealt with this matter at some length when it was in shadow form, and I do appreciate the work that everybody put into it. There is some irritation that we have to revisit the issue. Having studied it closely - particularly after the salaries' debacle - I find that I am concerned at some of its provisions. I appreciate that it is standard practice, and I take the point that it is the product of a specialised environment.

There are about 60 people in the Assembly who hold some kind of office. There is also a disproportionately high number of Members in the Assembly - far beyond the numbers in any other political institution. Our provisions go far beyond those of any other parliament or assembly. If I am elected to the Assembly, my contract of employment is valid until the next election. If we are elected to the Assembly or to Westminster for four or five years, in effect, we are signing a contract. If I employ a secretary or support staff, they will work for me for the life of that Assembly.

It would be hard for me to justify to the public my making provision to get money if I decide not to stand or to get money if, having decided to stand, I am rejected by the electorate. This goes far beyond the normal redundancy payments. If I decide to stand for re-election, and do not get re-elected, I should be entitled to some kind of redundancy - I accept that in principle. But it is the level and terms which concern me.

One can see where there will be pensions and prizes. One can see that every political party here will share out some of the positions over a parliamentary period. I do not claim that any party would do so intentionally, but parties may well find that after next year some Ministers feel out of their depth; or perhaps they will have had enough; or perhaps a Chairperson of a Committee may need to stand down. We could then have a situation with one person standing down and another being appointed, only for the same thing to happen nine months or a year later. This could be abused, and we should not give increased payments to someone who already receives an increased payment for the duration of the period he holds a given office.

I am concerned at the level of the resettlement allowance. It is a redundancy scheme. Mr Fee contends that one cannot call it that, and perhaps that it is correct, but to me it is a redundancy package. I have no problem with the making of some redundancy provision. Most of us represent constituencies where people are being made redundant. Reg Empey is presently trying to sort out redundancy packages for people all round the North, and he will not be able to say that people will receive a certain portion of the salaries they have earned over the last four years. That simply cannot be done. It is not the norm. We will be accused of giving ourselves enhanced payments, and we should be extremely careful of that. I certainly do not wish to support it. I do support the principle, but the levels are inappropriate.

As I say, I am against the notion that people who are office holders should receive money like this. It applies to me, and I am dealing with this on a personal basis. I am against the notion of parties or office holders getting any increased money when they decide to stand down.

I was concerned about the question of ill health. Mr Gibson has already raised the issue of age. I can accept the explanation given in terms of pensions. To give a certain age group the same level of money means that the people in that group are actually much better off. Perhaps we could amend the Bill to ensure that they are not disadvantaged if one person's pension is less than that of others. Perhaps some individuals do not even have a pension. We must ensure that all these groups are protected and have the same kind of financial outcome. That is my concern.

As I see this - and if I am wrong I will stand corrected - we have the resettlement grant and the winding-up allowance. Perhaps a Member will decide not to run in an election a year in advance. Perhaps he will say that he is not going to run in the next election, that he is finished. He knows that next year he is going to receive a resettlement grant and a winding-up allowance. That is not appropriate. One must surely be able to make provision for oneself if one decides not to stand for election. One must be able to say to oneself that one will provide for whenever one decides to leave the job. If one leaves one's job suddenly in industry, the civil service, or anywhere else, one leaves voluntarily and should not be compensated for that decision. That is what we are doing in effect.

Those were my main points.

On the simplest level, we are taking the recommendations from the SSRB Report and, as the Assembly recommended, we are implementing them to the letter. I do not want to go through everything in that report, but the rationale behind each and every allowance is discussed at very great length in it, and I contest Mr Maskey's opinion that our employment here is like having a contract.

For many of the Members here, it is not like that. Many Members came into the Assembly from jobs that paid extremely well - they took a pay cut to be here. They lost their job security, in two or three years' time they may have lost any chance of going back to that job. I can think of several professional people who came here. In two or three years' time they will have burnt their boats. They will not be able to go back. For many Members it is not a simple choice. Some literally had to give up very secure positions to take the risk here.

Some of these allowances are intended to allow people in that position to feel that they can stand for election and offer their services to the community. Some are there to try to protect people who find themselves out of work overnight and have difficulty getting a job.

The ill-health provision is really not that much different to that of any good employer who provides an ill-health scheme. Again, the provision of severance pay for those who hold office or other positions is not a significant departure from the public and private sectors.

I can certainly understand the concerns about the levels of provision. However, the levels are, by and large, percentages of the office cost allowance or they are linked to salary levels. The same percentages and linkages are used in Westminster, Wales, Scotland and Northern Ireland. We did not feel that there was any great or compelling argument for the Assembly Commission to tinker with the SSRB and that is why we have presented the Bill as it stands.

Further to the point made by Mr Maskey about the Commission being able to deal with abuse of procedure. For example, if a party decides to change its representative on a Committee, the Chair of a Committee, or office-holder, are there means whereby the Commission can actually question this?

We have had some conversations about this point. Currently, there is no mechanism by which the Commission can deal with that type of abuse of the procedures. Although this has not been discussed at a full Assembly Commission meeting, I think it would be a matter for the Committee on Standards and Privileges or the Committee on Procedures. The Commission is there to administer a number of these matters but I do not think it is necessarily there to police them. That must be the function of one of the Assembly's Standing Committees but I do not know if it has yet been determined as to which one will assume that role.

I refer to Clause 3, subsection (1) of the Bill on which I would make two points. First, the main thrust of that subsection is to cover the situation were the Assembly is dissolved in the ordinary course of events.

If, for example, a Minister ceases, on dissolution, to be a Minister and then does not get reappointed when the Assembly resumes, is the period of three weeks sufficient? Should the period not be a bit longer? I may be completely wrong in my presumptions so, perhaps you would comment on that also.

Secondly, I have a further point as to whether three weeks is long enough. A person might lose an office which entitles him to the extra stipend and, six months later, be appointed to another office. I am not sure how acceptable it would be if they received this allowance after three weeks and then take up a similar position again quite soon. I would be interested to know if the SSRB has looked at that eventuality and what they had to say about it.

It is a matter of judgement as to exactly what qualifying period should be put into the Bill at this point. Again, we have followed the line taken at Westminster. The purpose of the allowance is to help a Minister or office-holder adjust to the sudden reduction in salary when they lose that post.

To insert a longer period, such as six months, would actually defeat the whole purpose of having the allowance; which is to have some money in place, at a relatively early stage, when a Minister or office-holder, loses their additional salary. If this period were to be extended much beyond the present timescale then its whole purpose would be invalidated.

While all these allowances are payable in the relevant circumstances, they do not necessarily have to be paid unless the individual Member or office holder claims them.

That does not entirely deal with my points. I am concerned that this clause is trying to do two things at once. Perhaps we should have three separate clauses. A Member could resign from office - that is one thing - or could cease to hold the office because of a dissolution of the Assembly in the ordinary course. The third situation is that the Assembly is dissolved, one loses that office, then there is an election and a new Assembly is formed, and one could then resume office. Clearly one does not get this allowance if one resumes office. Is the three-week period intended to prevent that? That is my first point.

Our intention is to establish a severance allowance for office holders who leave office, but we are trying to ensure that people who leave one office to go to another office are not entitled to severance pay. How long do you have to wait before you establish that somebody is hopping from one job to another? It does not take very long to determine that.

I have a technical question. In a dissolution of the Assembly, on what day do you cease to hold office? On what day do you resume office? We must be careful about slavishly following Westminster here, because our constitutional procedures are slightly different. I think we agree about the intent of the clause. I am probing to see if it is sound.

The allowance would be payable if an office holder stood down mid term as well as at a dissolution.

I get that bit. My question concerns the situation on dissolution.

At dissolution, a Member who loses his office is entitled to this allowance if he is not back in office three weeks later.

Yes, but what is the date of dissolution? When this Assembly is dissolved and we have a new election on 1 May 2003, when is the actual date of dissolution? Is it on 30 April, one day before the election? In Westminster it is earlier. Westminster dissolves itself however long the Prime Minister decides before the actual election. It was three-and-a-half weeks last time.

The answer is that I do not know.

We need to know. I know that Members have discretion as to whether they claim it, but it would be better if it were clarified.

I do not know where the authority lies to make that decision, whether it is with the Assembly itself or with the Executive or with the First and Deputy First Ministers. But you are quite right, perhaps we should find out.

It may be more of a problem for us than for you, but we have to nail that down.

Maybe Mr Hamilton has a point regarding the Act.

We will look at the Act in more detail. Certainly there are provisions for office holders to continue to be paid until they actually cease to hold office, even though an election has been called, so the trigger for the 3 weeks may be later for office holders than for ordinary Members.

I think there is also a difference between us and those at Westminster. The Assembly has a fixed time whereas the Prime Minister can call a Westminster election at any time. The Assembly is dissolved after a four-year period.

I know that there are other offices involved but perhaps we could deal with the office of the Minister. A person ceases to be a Minister when he no longer holds the seal of office. I am not familiar enough with the Act to know when that occurs.

I am advised that section 31 of the Act relates to that.

A Minister is technically still in office until someone else takes over.

I shall read the two relevant bits. Section 31 (2) states:

"The date of the poll for the election of the Assembly next following the Assembly elected under section 2 Northern Ireland (Elections) Act 1998 shall be 1^st May 2003; and the Assembly elected under that section shall be dissolved at the beginning of the minimum period which ends with that date."

Subsection (6) states:

"In this section a 'minimum period' means a period determined in accordance with an order of the Secretary of State."

If that period was four weeks it would trigger the provisions accidentally.

That is correct.

It could be over-ridden by the fact that there is discretion as to whether the eligible person claims the allowance. I do not think that that is satisfactory. It needs to be clearly set out.

We shall look at that.

It does not refer to dissolution.

The SSRB made provision for the Scottish Parliament. Has it adopted these proposals? I think you answered that earlier but I could not quite hear what you said. Has Dáil Éireann adopted similar procedures? When does it all start? Does it start at the beginning of devolution 15 December or does it start on 1 July 1998? You state that the percentage rises from 50% at under 50 years of age, six months salary, to 100% for those aged between 55 and 64. Why does the percentage not rise for people under 50 years of age or over 70 years of age if they have 10 years service? I ask particularly in relation to those who are under 50.

The rationale behind the Senior Salaries Review Body recommendation was that there should be a flat rate for everybody. It then looked at the difficulties of Members who were over the age of 50 and at how close they were to 65. They looked at the difficulties for those people of getting alternative employment and found that the closer one gets to 65 the harder it is to find an alternative income.

So a graduated system applicable until the state retirement age was introduced. Until 1991 there was no provision for anyone over the age of 65 - pensions just clicked-in. The then equivalent to the Senior Salaries Review Board decided that, instead of having a cut-off point at 65, it would taper it back down - it was assumed that people over 65 who are entitled to their pension would not be relying wholly on an alternative income.

I made particular reference to the position of the under-50s who have ten years' service - if the Assembly lasts that long. Why was no provision made for them? It certainly does not affect me, but it will affect somebody. I would also like an answer to the other question that I asked about the Scottish Parliament and the start date.

The start date for the calculation of resettlement and ill-health retirement allowances is 1 July 1998 - the date that we effectively took up our seats. The calculation of these allowances is backdated; the other allowances, which kick-in when somebody leaves the Assembly or loses his post, do not depend on length of service. The other allowances do not need any backdating as they will be based on a proportion of the actual salary earned when a Member loses his post or a third of the office cost allowance when he retires. What needs to be backdated has been backdated.

How will the number of years that a person has served be determined?

That is what I was trying to establish.

The calculation starts from 1 July 1998.

The other allowances are all recommended for Scotland and Wales. I think Scotland has them in place already - it was in the process of putting them in place when this Committee was considering the Bill. Wales is going to put it in place. I cannot tell you if it is running yet, but I believe that it is. Similar allowances are, in fact, already in place in both Scotland and Wales. The Dáil has a very unusual system of allowances which is not comparable to our system - in many respects it is a more generous system. However, as a result of the research done by the SSRB, the analysis done in Northern Ireland by Hay Management Consultants and the comparative studies with other legislatures, there were no significant grounds on which to recommend that the Assembly should do other than implement this allowance system in full.

I am satisfied that we take on board the SSRB's recommendations, but I would point out that the Dáil has a much more generous system, and I just wanted to highlight that point.

Join it.

I will certainly not be joining it.

I am interested in the response to Mr Bell's last question about whether the legislation has actually been enacted in Scotland and Wales on the office holder's allowances et cetera. I am very conscious that, when we are prioritising expenditure, the perception can easily be given - and it has already been given in relation to the increase in Members' salaries - that in prioritising, we are making sure that "I am all right, Jack" or "I am all right, Jill". We should be very conscious of the fact that this is taxpayers' money. To have the legislation in place and operating before it is operating in Scotland and Wales - and they had devolution prior to us - would make us open to such accusations.

The more I listen to the reasoning behind the clause on office holders, the more I dislike it and the more I find it very difficult, if not well-nigh impossible, to justify it. We all stood for election and were elected to the Assembly, and whatever the justification is behind having allowances for Members, I do not see how one can step outside that. Because of further operations within the Assembly, an individual becomes an office holder for which he or she is paid, and paid with justification - I have no qualms about that whatsoever. But how can one pay that on a change of office holder, which could be, as Mr Maskey has pointed out, at the whim of a nominating officer and maybe after only 3 weeks, that person could be entitled to an allowance. I find that extremely difficult to justify.

How did the SSRB conclude that it should be a quarter of the office holder's salary? What is the rationale in a quarter? That in itself seems to be somewhat defensive: we will get this in but we will only get it in at a quarter of the office holder's salary.

This concept is dubious and, if it is accepted we will have to stand back and try to tighten the legislation so that it is not subject, or perceived to be subject, to abuse. In Northern Ireland, perception often means more than the truth itself, and if this is allowed to exist, as it is currently drafted, I can see its being a huge stick with which the electorate could, with justification, beat us across our backs - and we will deserve that - unless we do something about it.

The Bill reflects exactly what is in the SSRB recommendations.

Under our procedures there is only one opportunity during the passage of a Bill for amending it, and that is when your Committee reports back with recommendations to the Assembly. While we can come back to clarify some issues, the only way of changing effectively what is in the Bill is for this Committee to present a report with a recommendation to amend it on the Floor of the Assembly.

I do not particularly want to respond in any great way to Mr Close's point because I agree with him. Nonetheless, this is what has been recommended by the SSRB, so there is a political judgement with a small "p" which, presumably, this Committee will have to make.

Whether we call ourselves Jack or Jill, or Diarmaid or Gráinne, at the end of the day the dilemma is this: do we accept the SSRB recommendations or do we provide an alternative? I am more than happy to support a call for more time to look at alternatives.

Is it not too late for that? Has the Assembly not already adopted the SSRB recommendations?

No - [Interruption]

There is no statement, nothing in the Bill's explanatory note about its effect on equal opportunities. Was this matter considered?

The fact that there was no item on equal opportunities was raised at the Commission. In my introduction I said that we looked at the equal opportunities implications of the Bill. We have detected none at this stage. Issues such as ageism can be very difficult to detect and I cannot state categorically that there is nothing in the Bill that might not disadvantage somebody. However, we have detected no equal opportunities issue in it.

Would it be helpful if we were to forward the Bill to the Equal Opportunities Commission in order to get its views before we go any further? The question of ageism raised by Mr Gibson is an important one.

Obviously, Mr Chairman, the Committee is free to pursue the passage of the Bill in whatever way it wishes. We have listened to advice from the Office of Legislative Council; we have had officials from the Department of Finance and Personnel looking at this aspect of the Bill; and we have studied the legal and technical aspects of the Bill.

The only difficulty with your suggestion is that we have yet to establish procedures for the Committee stage of Bills. If we set precedents by referring matters to the Equal Opportunities Commission, or any other body, we will find ourselves involved in a very cumbersome legislative process. I am not rejecting your suggestion, but I think there is sufficient expertise within the Department of Finance and Personnel and in our own Legal Department to ensure that we can detect any substantial flaws such as discrimination. However, I do not wish to second-guess your judgement.

Subsection (1) of Clause 3 of the Bill which deals with the allowance payable to Members who are not re-elected within 3 weeks of ceasing to hold a qualifying office is causing general discontent. The expression "snouts in the trough" springs to mind.

There is a danger of replicating here what happens elsewhere, and that would cause great unease. We should reflect on that point. It is difficult for us, as the new boys on the block, to change something that has already been adopted by the Assembly. We need a mechanism which will look at how we operate in order to avoid replicating what has happened elsewhere.

I am not satisfied that we have examined the Bill against all the equality laws in order to ensure that it does not contravene them. We have different legislation in Northern Ireland to measure the Bill against than exists in Great Britain; we also have a different legislative system. Our legal precedents are different as is our interpretation of law. I do not think that we have really given this Bill full consideration. By trying to mirror the conditions that apply in Great Britain we could end up creating something fictitious rather than something real.

We have taken legal advice on this at every stage.

With all due respect to the legal advice, the Democratic Unionist party has some experience of that. I have normally found that the Northern Ireland Office's legal advice has generally been at variance with what turned out to be the correct legal advice. I am not being churlish.

It raises a difficult question. We have to deal with the draftsmen; the Office of Legislative Counsel; the Department of Finance and Personnel; and we have our own Secretariat looking at these matters. Normally, once legislation has been passed, the place where it is tested is in the courts. We cannot usurp the role of the courts. It would make the legislative process extremely difficult if we were to test every piece of legislation against every contingency, especially when the legislation is the result of all the experts putting their heads together.

There was also a provision within the Office of the First and Deputy First Minister for dealing with the equality-proofing of legislation, normally the other aspect with Bills coming through. Although we do not yet have that in train, it may already be necessary to look at the alternatives it offers.

Perhaps at this stage I should mention - and I was remiss in not saying this at the outset- that there is one significant difference between Scotland and Wales and Northern Ireland. They achieved devolution more quickly than we, and had their legislation in place sooner. The reason we are coming to you so quickly with these two Bills today is that we do not have any provision in place for Members who may have to leave owing to ill health or whatever. There is some urgency in trying to get these schemes, or such schemes as you agree, in place. We will then be covered for all eventualities. That is one reason for coming forward so quickly with this draft Bill.

The other fundamental principle underlying the Commission's approach concerned the question of salaries, wages, pensions and allowances. We felt it was crucial that these should be set by an independent body. That is why we have taken this report, metaphorically speaking, as Gospel, since it was the conclusion for Wales, Scotland and Northern Ireland, individually and severally, that remuneration levels should be arrived at by a completely independent body using a number of management consultants. It is also a principle that we, as an Assembly, should not set the rates and the various allowances and so on, that we should continue, as far as possible, to rely on independent advice. This is one of the important reasons that we recommended that the Assembly accept the report "warts and all". This is why we did not tinker with it, as I should have made clear at the outset.

On the previous Bill what way do you want to proceed with the questions that were raised, in particular in relation to three weeks, Mr Fee? Do you want to come back to the Committee?

If the Committee wants us to come back we will do so, but some of the points which were raised were quite technical, so we will need to study the Hansard. On the question of dissolution we need to get absolutely crystal-clear legal advice; we will arrange for that to be done and for it to be made available in writing to the Committee.

We will also need to get clear legal advice on the question of the potential discrimination within the scheme for calculating the resettlement grants, and we will let you have that as soon as possible. We will reply in writing to any other questions you may have which we will be able to pick up from Hansard.

It is for the Committee to decide if you want us back. I do not know if it is appropriate to ask the draftsman to come along, but we can talk about whether there are any other people that you may want to invite.

I want to be clear about the position of the first Bill that we discussed. As I understand it - and I am open to correction - this Committee can now table amendments to that Bill to the Assembly. Is that correct?

Yes, propose amendments.

But we could receive further advice and clarification from the Commission?

Yes.

My party accepts the SSRB and its independence. The only concern that I and my party have is that it be thoroughly checked against our legislation. Wales has different sets of laws and equality laws to those in Northern Ireland. There is a whole raft of legislation. It is not a matter of lifting the mirror off the wall. Our mirror is not white; it is maybe more distorted.

Multicoloured.

Bearing in mind that this is the first piece of legislation to go through the Assembly and this Committee and that it is the first piece of primary legislation of the new millennium, we have found this very useful and helpful. We will study the various points that have been raised and ensure that you get decent information in response to them.

Thank you very much, Gentlemen.

Allowances to Members
of the Assembly
and Office Holders Bill
(NIA Bill 2/99)

Witnesses:

Mr John Fee MLA and Mr Tom Evans
(NI Assembly Commission)

Mr Dennis Millar
(NI Assembly Finance and Personnel Directorate)

Mr Jim Hamilton
(Department of Finance and Personnel)

Welcome back, Mr Fee, Mr Evans, Mr Millar and Mr Hamilton. Thank you for your letter in respect of the Allowances to Members of the Assembly and Office Holders Bill. Members have received a copy.

Mr Fee, perhaps you would do a short introduction and then answer any questions that we may have.

Thank you, Mr Chairman. I do not intend going through all the detail that is in the letter; I will simply make a couple of brief comments. I would, however, like to thank Mr Hamilton and Mr Evans, in particular, for helping to do the precise research which ensured that we are in a position to respond to the three questions that we felt were significant that were put to us.

There were, as we understood it, two technical questions about the Bill and one matter of fundamental principle at issue during our last meeting. The first technical matter was to do with the potential age-discriminatory effects of the Schedule. We have itemised for you the legislation that we understand exists in Britain and the legislation that applies in Northern Ireland. We have taken legal advice, and there is nothing that we can detect which would breach any equal opportunities, fair employment or other anti-discriminatory measures.

I would like to qualify what I said at the last meeting when I said that, ordinarily, when a Bill has been checked by our legal people, it is ultimately for the courts to test any substantial flaw. I forgot to say that whatever emerges from this process is checked by the Attorney General. It does not proceed unless the Attorney General is satisfied. So there are a series of steps during which the legal and other effects of a Bill - of all Bills, not just this one - can be checked. It is the Commission's view that there are no discriminatory problems with this particular Bill.

The second question concerned the possibility of inadvertently triggering a severance payment to office holders during the period between the dissolution of the Assembly and the election of a new Assembly and the appointment, or re-appointment of office holders. The Committee was correct. The Commission had not considered this matter. There was a glaring flaw in the Bill as it stood. The Commission suggests that the flaw can be put right by amending the Bill to lengthen the period when a person is out of office from three weeks to six weeks. We have given you details of the maximum periods of time under the legislation, between dissolution - when office holders cease to hold office - and the offices being filled again after elections. We recommend that the three-week period be lengthened to six weeks. Additionally, to copper-fasten the matter, we suggest that the period of dissolution does not count towards the calculation of time out of office. We believe that this will provide a fundamental protection against the inadvertent triggering of this particular severance payment.

The third issue raised was the fundamental matter of whether or not the Committee wanted Clause 3 'Allowances to persons ceasing to hold certain offices'. The Commission cannot go much further in informing you or helping you with your deliberations. The Commission was charged by the Assembly to bring forward all of the recommendations of the Senior Salaries Review Body (SSRB). That is what we are trying to do in this Bill. The Commission unanimously holds that it is a very strong protection for the Assembly to be able to say that Members did not set any of the allowances, salaries or other payments, and that they are entirely in accordance with a professional report which Members endorsed sight unseen. If in the future anyone queries the levels of pay or allowances, there will be a published foundation on which everything the Assembly has done can be based. That foundation is the independent advice of the SSRB.

While the Commission cannot interfere with the Committee's decision on such an important point of principle, we strongly believe that this would be the only change made to the SSRB advice. If the Committee were to make that change, the question would arise as to why the mileage allowances, the subsistence allowances, the rates of resettlement grants and everything else were not changed also. My plea, on behalf of the Commission, is that sticking to the SSRB recommendations best protects the Assembly. I am happy to take any questions.

Thank you for those details.

I would like to welcome Mr Attwood to the Committee and to this meeting. I would also like to remind members of the public and Committee members of the need to switch off mobile phones to avoid interference with the transmission of these proceedings to the Hansard staff.

I do not wish to tell the Chairman his business but, on a technicality, should Mr Attwood not be asked about a declaration of interest?

I did not like to do it in such a public way. On Members' interests, does Mr Attwood wish to declare anything?

Not at the moment.

Thank you.

Mr Fee has partly answered my question; it is in three sections. First, would he agree that it is important that all salaries and allowances be agreed or fixed by an independent body? Secondly, would it not create an unfortunate precedent if, having asked an independent body to carry out a review using management consultants, Members were to change it to either their benefit or detriment? Thirdly, technically the Assembly has accepted the SSRB recommendations in full. How would Members then stand if, after having had a formal motion to accept the SSRB recommendations proposed, seconded and agreed on the Floor of the House they then make substantial changes to any of the recommendations to either their benefit or detriment? I asked for clarification of this before Mr Fee arrived. Is he able to throw further light on the matter?

I will answer the questions in reverse order. The Assembly voted unanimously to accept SSRB, but it voted while in shadow form. My understanding is that the legislative Assembly has the right to make a decision on this. On the first and second questions, the report of the outside body was accepted in England, Scotland and Wales. The Assembly's decision is based on the information in the report. For instance, Members are being paid at Grade 7 level, which is similar to the Clerks of the Assembly. There is a point of principle. If Members make any changes at all, they will be asked for the rationale behind those changes. If a change is made now, it will affect the SSRB recommendation that the annual upgrades should be percentages of various items. Members would have to come back and visit that issue repeatedly and find some way of upgrading or determining the future values of the various allowances, et cetera. However, if the baseline set by the SSRB is used then there will be an automatic mechanism for adjusting for future years. The Commission feels very strongly that that is the safest option for the Assembly.

I appreciate the point made about the SSRB, and I think that there is some merit in it. While there are elements of the SSRB report that Members would not particularly agree with, I can see the justification for applying it in the Northern Ireland situation. The point has been made that essentially the aim is to follow the SSRB recommendations. Apart from following the SSRB report, is there any justification for proposing additional allowances for office holders on leaving office? Could it be illustrated, for example, by details of any particular expenses which office holders might incur over and above those incurred by ordinary Members? I cannot think of any in the context of the Northern Ireland Assembly.

An office holder could suddenly find himself out of office. The main purpose of this allowance is to cushion the loss of salary if that happens; I do not think that there is any greater reason behind it.

As Mr Hamilton has said, it is there explicitly to act as a cushion against a very significant drop in salary. The obvious example is where a Member loses office after holding it for some time. He has bought a house and has substantial mortgage repayments to make. Yet, overnight, his salary drops by £10,000 to £30,000. That Member has a problem. That is just one of the situations that this payment would cover. It may not be a very palatable measure, but some of them are put in specifically as preventative and protective measures so that, if somebody loses a ministerial job or his chairmanship of a Committee, he will not be found in the bankruptcy court six weeks later.

I thank Mr Fee for confirming that this is now a legislative Assembly and for agreeing and clarifying that this is an issue of principle. I would draw the distinction - and I have done so in the past -between the right of the whole Assembly to agree to an independent body's setting the level of allowances, salary et cetera and the right of this Committee and/or a Member to ask for some allowances to be set aside if they feel, on principle, that they are unjustified.

I do not have a problem with the general principle that Members of an Assembly should be entitled to some form of "severance" if they are not re-elected or whatever. But we are talking about spending money out of the public purse, and so we are accountable to the people. I would stress that when we were elected to the Assembly we were all equal. After the election, party political decisions, or whatever, were taken to make different Members office holders. These office holders are very well paid, and with justification. A man is entitled to payment for the job that he is doing - I have no problem with that. Some members of the general public may think that they are being paid too much; that is another argument. But the fact that a Member resigns office, or is not re-appointed to it, is no justification for that Member's being paid an additional severance allowance. It is all about additionality. That is where the principle comes in. We are talking about adding to the basic severance allowance that each Member is entitled to, and I think that that is unjustifiable.

On top of that we have something else unique to this Assembly: a nominating officer can decide for, whatever reason, to change his nominees as office holders. In a three, now to be changed to six, -week period we could have a merry-go-round of post allocations. This process is open to potential abuse. As the guardians of the public purse we have a responsibility - and I stress this point - to ensure that abuse cannot and will not take place, and the best way of ensuring that is for the Committee not to accept this clause and recommend that the Assembly do likewise.

Mr Fee, do you want to come back on that point?

No. I am not here to interfere with the Committee's deliberations. The Commission performed the function that had been set for it. It is now for the Committee to decide the way forward. We do not want to get involved in any conflict or dispute.

The Senior Salaries Review Body deals with a wide range of different payments to different office holders. Is there any difference between our Assembly office holders and those of the Scottish Assembly? Is there a variation in the Senior Salaries Review Body recommendations? Do our recommendations cover all those covered in Westminster and Scotland?

Each of the recommendations circulated to your members states that it applies across all of the Assemblies - Wales, Scotland and Northern Ireland. The only thing that changes is that mostly there is a recommendation that a payment be made which is linked to either office costs allowance or salary, and one of the clauses in the SSRB report sets three different salary levels for Wales, Scotland and Northern Ireland.

Because the Members' salaries are higher in Scotland, the effect of what we are recommending be contained in the Bill and in the salaries determination is that Northern Ireland Members are paid less than the Members are in Scotland. The allowances, resettlement grants, and severance pays are all less here than those paid in Scotland. But all fulfil the spirit and the letter of SSRB.

I would like to make two points. For the record, I have no difficulty at all with any of the Commission's work. In fact, I would like to pay tribute to the work that the members of the Commission have done over a fairly long period of time. I know that this is a difficult issue to deal with, but I want to put on record my appreciation of the work that the Commission did in spite of the fact that I have a number of objections to what is contained in the report.

Returning to my concerns, Mr Fee, do you know whether the SSRB took into consideration the fact that two thirds of the Members of the Assembly here are office holders? I do not think that is in anyway comparable with the situation in either of the other two Assemblies.

Yes, there is a section in the SSRB which points out the unique difference between the workload of a Westminster MP and the workload of the Members of the Scottish, Welsh and Northern Ireland Assemblies. The SSRB has accepted that, because of the Committee system and the inclusive nature of the legislative system that we have here, by and large, the workload at Committee and legislative levels is going to be significantly higher for a Member of the Northern Ireland Assembly than for his counterparts in Scotland and Wales and even, to some extent, in Westminster.

The SSRB has itemised, and weighted, and scored the various types of work and responsibilities that it believes that the various people have, and because of that, it has justified a significantly higher salary for Westminster, and a slightly higher salary in Scotland. Then come the Northern Ireland salaries and then salaries that are slightly less for Wales. It has recognised that, in broad terms constituency work will be the same right across the board - whether one is in Westminster or one is a Northern Ireland Assembly Member. Well, proportionately the workload might be smaller for the Assembly Members because there are more of them per head of population. The answer to your question is "yes", in recognition of the fact that the board expects a higher level of Committee activity for each Member. That is one of the reasons.

But, particularly with regard to Clause 3, there is a significantly higher number of office holders in this institution than there is anywhere else. That is the point that I am making.

There is a significantly higher number of people - there is not a significantly higher number of offices. In Westminster there are hundreds of various different types of offices, but there are 600, or so, MPs. By and large, much of the same work has to be carried out by the legislative Assembly here. The effect is that a higher number of people are needed, proportionately, to fill those posts. I do not know if the SSRB gave that any consideration. We are straying into what are political judgements, as opposed to the SSRB's judgements on the value and the type of support needed by Members in order for them to do their job.

The point that I was going to raise has to a large extent been covered. But, when looking at severance pay for office holders, and while the work may be the same in proportionate terms, surely it is valid to say that, when comparing Northern Ireland with Scotland, Wales or the main UK Parliament, there is a higher percentage of people here who are office holders. Therefore, irrespective of the work being done, the percentage of people who qualify under Clause 3 is much higher than elsewhere.

In Scotland perhaps between 10% and 20% at most would qualify as office holders, whereas more than half the Members of the Northern Ireland Assembly qualify as office holders; the same figures apply to the Welsh Assembly and the UK Parliament. There is a question mark over whether the SSRB has taken that into account. As the allowance deals with paying a large amount of money to office holders, there really has to be proper justification for it.

This was not the issue for the SSRB. It was addressing the matter of people being asked by various legislatures to take on the additional duties required to make the parliamentary process work. These duties are over and above the normal duties for which they are paid as officers of the institution. SSRB had to ask that if Assembly Members were to lose their jobs and additional salaries, would the normal practice be that they should have some form of severance pay to take account of an immediate drop in salary? The SSRB has applied the same employment principles to employment as office holders as they applied to our employment as Assembly Members. It is the same principle.

I wonder if the SSRB's decisions have been unduly influenced by the practice at Westminster. The devolved institutions have only recently been set up, and Westminster's practice will differ from that of the new Assemblies, particularly from that of the Northern Ireland Assembly. I can understand that a Cabinet Minister at Westminster who resigns or loses his post would incur extra costs, for example, if the Minister lived in a house provided by the Government. That is not the case in Northern Ireland.

Although this is more a point of principle rather than a technical point, it seems that the SSRB has not given adequate consideration to the problems arising in the amendment to Clause 3 of the Allowances Bill in changing the three-week period to a six-week period - a matter with which we have already dealt. Have they taken the different circumstances of Northern Ireland into account or have they just glossed over them? This raises doubts over its appropriateness.

That is a fair point. However, as I keep repeating, if the SSRB has got it wrong, the Commission will point out to the SSRB where it got it wrong. The SSRB is committed in the report to reviewing the entire matter of allowances in two or three years' time - a relatively short period.

Rather than selecting one specific clause out of the 170 or so recommendations and saying that it is wrong - and by implication that everything else is right - I strongly recommend that you accept the findings in their entirety, and, having studied it, make your objections or observations or comments about it to the Commission, the Assembly and the SSRB and ask them to review the sections with which you are unhappy. I do not think that we share any of the blame for this.

We agreed last week that we would accept a professional report. I suggest that we accept it, and if there are points in it with which we are not happy, we should draw them to the attention of the SSRB. This is what the Prime Minister did on the Floor of the House of Commons when he set the salary for the Deputy First Minister.

The Bill actually does not list the office holder, but it does refer to Standing Orders. Do we have a final list of office holders and business managers? That has not yet been finalised in Standing Orders. That is one of the questions which we raised at our last meeting.

The list of office holders appears in the salaries determination which was passed in early December, but there is a question mark over whether or not office holders need to be specified in Standing Orders to be legitimate.

Unless I am mistaken, there is clear and specific reference in the Bill to who the office holders are. The qualifying offices are defined in Section 47(3)(a) of the Northern Ireland Act 1998. Surely, strictly speaking, it has nothing to do with the determination; it is to do with whatever is contained in the list at 47(3)(a).

The Act allows other office holders to be specified. Jim Hamilton has a copy.

Section 47(3)(a) refers to specific offices such as those of Minister, Presiding Officer, Deputy Presiding Officer and members of the Assembly Commission, but it also refers to those people who hold an office specified in Standing Orders. This means that Standing Orders dictate how many other office holders there are. At present we envisage that the Chairmen and Deputy Chairmen of Committees would be included, but obviously other paid offices as might be created within the Assembly could also be included. Currently there are no others.

Many of these points have already been made to the Senior Salaries Review Body. During the period before it published its report we had direct contact in order to explain fully the Committee and legislative systems and the way in which the Northern Ireland Assembly would work. Members of the board had detailed knowledge of our vision and of what we foresaw would happen.

The board was commissioned by the Secretary of State to make this report and it would also have had detailed discussions with the Northern Ireland Office as well as with political parties, including all of the major political parties in Northern Ireland. So it is not the case that it was not informed, and this is why I keep coming back to the fact that it was a professional, independent body in receipt of all the knowledge and information it required. If there are flaws, and other flaws may appear over the next couple of years, let us agree with the recommendation for a review in two or three years' time.

If this Committee wishes to pursue an amendment, the Commission will not fight over that, but the Commission is deeply worried about departing in any significant way because justification for every other decision made under the Senior Salaries Review Body becomes vulnerable.

Mr Fee has read my mind; that was to have been my question.

I understand that every political party had the opportunity to make oral and written submission to the Senior Salaries Review Body, and I represented my party on that. Today I have been listening to the same sorts of questions that were put to the Senior Salaries Review Body, questions which it, in turn, put to delegations from each political party. I am concerned that we have gone through a procedure of giving oral and written evidence to an independent body and then come back to reiterate all the same points.

It is called democracy.

Some would call it long windedness.

The Commissioner referred to our vulnerability. To whom does he consider we would be vulnerable if we changed or decided to set aside a recommendation of the Senior Salaries Review Body?

Anyone who wants to come in and ask why we are getting, for instance, 'x' pence per mile. The answer is that the Senior Salaries Review Body recommended it. Why are we getting £80.50 subsistence allowance for staying overnight in a hotel, and how was it calculated? It was calculated by the SSRB on the basis of various different costs.

If we change the details of any of those allowances - from mileage right through to office costs we shall be vulnerable. We would be asked why we changed one without changing all the rest. We would then have to invent a professional independent basis on which we could make those decisions ourselves. For our own protection, we should adopt the SSRB recommendations as our starting point. As we become aware of any major or significant abuses, or problems with it, we can recommend changes to the incoming review body when this is reviewed in a few years' time.

Over a year ago, when we met and discussed this matter with the SSRB, the Shadow Commission recommended to the SSRB in the strongest terms that Members be paid their full salary during the shadow period of the Assembly. The SSRB did not agree, and the result was that Members were paid an abated salary. When the full salary was paid, Members were blamed for giving themselves pay rises. Perhaps this happened because the press was not willing to accept that the SSRB report had been published ten months earlier. However, Members receiving criticism could safely say that they did not set that rate. This is the type of vulnerability I am talking about, Mr Close.

We shall have to draw this particular issue to a close. Are there any other questions or points, particularly relating to the equality issue of age that Oliver Gibson raised at our last session? The letter quite clearly states that a view has been sought on this matter; that it is not outside the legislation, and there is no problem in relation to it. Is everyone satisfied or are there any questions on that matter?

I would like to make a comment. I am sorry Mr Gibson is not here. Any vulnerability in that particular schedule is not at the higher end of the age bracket, for people will receive both their Assembly and state pension after 65. We must remember that the enhanced resettlement grant will be available only to people who have been in the service of the Assembly for at least 10 years. There is a potential for discriminatory practice if someone with 10 years' service leaves the Assembly aged 50 years and 11 months. As they will have not reached the age of 51, they will not receive the enhanced resettlement grant. So it could actually be the younger long-serving members who could potentially be discriminated against, although this will not actually apply for another 10 years. I hope that that we shall look at this issue again as the concept of fair employment develops in the meantime.

Mr Leslie, was there a point you wished to make?

Thank you, Mr Chairman. Perhaps I could again raise the point to which you drew our attention. We were talking about it some moments ago. The salary is the driver of the benefit, and to find out the level of salary, one must refer to the Pensions Bill. However, we will need to ensure the Pensions Bill is passed before this Bill. As long as that happens, there will be no problem. However, the Committee stage of the Pensions Bill could take some time as it is quite a long Bill. This Bill is almost complete. We need to be aware that if we get into a situation where we try to pass this Bill first, we will have to amend it in order to include a definition of salary.

I have raised this matter, and the Commission is aware of it. I do not know if Mr Hamilton wishes to comment on potential solutions, such as whether we should introduce the definition of salary into this Bill, or whether we should do as you say and wait for the Pensions Bill to be passed.

Our current approach will be to allow the Pensions Bill to pass to its final stage before this Bill progresses that far. Mr Fee is correct in saying that if there are reasons why this Bill should be passed more quickly, amendments would be required to bring in a definition of salary and an order-making authority for the Commission to change the level of winding-up allowance.

We do expect the Pensions Bill to get as much priority as any of these other Bills. It is very complicated, and I know that you have a lot of work to do, along with Mr Coulter and the trustees. There is, however, some level of priority with the Pensions Bill as well.

With reference to the SSRB and the line that we accepted, a problem may arise in the future if SSRB recommends increases. Does it mean that we will follow those in the same way? If there were to be an increase in allowances or salaries, would that come back to the Assembly?

The SSRB is linking any increases in salary to the mean increase in salary of civil servants within a certain band. We would only qualify for roughly the average salary over a certain section of the Civil Service. So it is linking it to public sector pay rises.

Could we opt out and say that we were not ready?

The Assembly could opt out at any stage. At this point I am warning against it, but I am not saying that we, as we were accused of doing, slavishly follow SSRB all the time. It has to be reviewed in two or three years' time, and the Assembly will have to take an informed decision on what to recommend to SSRB the next time from its own experience over the next couple of years.

While we are back on that subject, if you want to know what happens if SSRB is not used look at the mess that Westminster was in at the point at which it decided it would appoint the SSRB. Westminster had set its own rates and scales and over time progressively the amount that Members were paid kept falling - they were embarrassed about giving themselves a pay rise. Then the question arose as to how much you pay for democracy and what would be a reasonable wage for this - it became impossible. It was decided that that could not go on and that it should be done independently. Westminster appointed the SSRB and that established the precedent that we are now following.

At each review by the SSRB there is a row, but at least, as Mr Fee said, you can blame the SSRB, whereas it used to be that the Members at Westminster were blamed. If you ask Members at Westminster who have been there for 15 or 20 years and who have gone through the evolution of this cycle, they would, to a man, tell you that it is never easy but that it has been easier since they sub-contracted the whole thing to the SSRB.

Thank you very much. The meeting will continue in open session, and I hope that people can stay on.

We have two points that we have to start on. One is that we have to decide whether we need Clause 3. If we decide we do not, we still have to put in the amendments to Clause 3. The Assembly could decide that it wants a Clause 3 in it, so the amendments that we feel are necessary would still have to be there to safeguard the Assembly. There is a fail-safe mechanism.

There are two lines that we can take. We can move to amend Clause 3 as it stands, and if we are happy enough with the recommendations, we can deal with whether or not we need Clause 3. Is everyone happy to proceed in that way?

I certainly advocate the adoption of motion 1.

Regardless of the views on Clause 3, which is a separate issue, motion 1 is uncontentious irrespective of whether or not there should be a Clause 3. No one is opposed to motion 1.

I think we should proceed with motion 1 - it is only a fine-tuning exercise.

OK.

I acknowledge the point made, and without prejudice to my position on Clause 3, I am prepared to accept motion 1.

That is basically it.

I thought we would take the issue of whether or not we want Clause 3, and if that is defeated, we could move on.

It is irrelevant which one we move on. From the Committee's point of view, if we rule out Clause 3, we still have to ensure that if the Assembly passed a Clause 3.

It has got to be a competent clause.

The Committee considers that Clause 3 of the Allowances to Members of the Assembly and Office Holders Bill (NIA Bill 2/99) be amended as follows:

Clause 3 (page 2, line 33) leave out "three" and insert "six".

Clause 3 (page 3, after line 3) add

"(5) In reckoning the period of six weeks referred to in subsection (1)(b) no account shall be taken of any time during which the Assembly is dissolved." - [Mr McClelland]

I second.

I second.

Would someone explain that to me.

It means that if the Assembly followed our recommendation, it would take out Clause 3, saying that it did not support it.

Does Clause 3 cover the allowances when office holders cease to hold office?

Yes.

I do not support this motion. How would those who do feel about a minimum period for holding office, which would attempt to deal with Mr Close's point that an unscrupulous party Leader could "job-hop" people in the period leading up to an election?

The substance of my objection is two-fold. The first is the potential abuse, and the second is the fact that Members get Assembly severance as well as office holders' severance.

Assembly Members ought not to set their own salaries and allowances. The Assembly took that view when it brought in SSRB. One either accepts that or not. If not, we will have to set our own salaries. We have brought in SSRB and it would be foolish, for the reasons John Fee has given, to depart from that. I will not be departing from that. That is my position: we ought to go along with SSRB.

If there has to be a review in the future so be it, but it is dangerous to start tinkering with the SSRB at this stage.

I support the motion that we delete Clause 3 and would be happy to include an amendment which would cut down on allowance abuse. I support the suggestion to change the period from three to six weeks, merely as an attempt to avoid abuse. If the motion to delete Clause 3 does not succeed, I will support any further suggestions that come forward.

There are a couple of things which need to be addressed. I am glad to see that there is a proposal, in terms of an amendment, at least to stop potential abuse - that would be worthwhile. But, as with the Member who proposed motion 2, my objection to this goes wider. With regard to the SSRB, one can take either of two approaches. One is, in effect, to treat the SSRB report as Holy Writ and follow it exactly to the letter. If we do that, we should reject motion 2. However, we have not taken that approach; we have just unanimously agreed on motion 1- not to treat the SSRB report as Holy Writ.

There are many terms contained in the SSRB report that I am not entirely happy with. The other route to take in terms of the SSRB report is to say that in principle we support it. However, we should not confine ourselves to every jot as there are things in it which have gone through that we have disagreed with. I agree with the terms of motion 2 that Clause 3 is so unjustifiable that common sense suggests that it should not form any part of it.

Nobody would argue with the principle that an Assembly Member, or any office holder, should receive some severance pay when he loses his job. However, this is different from an office holder on a big salary being moved down to what is still a good salary, compared with that of the average working man. If you like, we are cutting the level of luxury that people are enjoying, and we are going to compensate people whenever that happens. These are two fundamentally different positions.

There is an argument that says that we will be vulnerable if we depart in any way from the SSRB report; but we have seen that we have been vulnerable when we have followed it, so neither side of that argument is watertight. Somewhere, as an Assembly, we have to draw the line. If we follow the SSRB report slavishly, we will have people arguing that if it were a condition of payment that we slaughter the first born in the Province, would we glibly nod our heads at that?

There has to be a point where, while the broad principles of the SSRB report are accepted, we must apply some degree of common sense and justify each of these things. While I disagree with some of the terms of the SSRB report, there are others which have some justification, for instance, mileage allowance and allowances for those on Assembly business out of the country. There is some justification in these cases, even if I do not agree with the exact amounts recommended.

This is one area where the SSRB has patently got it wrong: I cannot see any justification for office holders getting additional money, considering the circumstances which Northern Ireland is in.

That is why I asked Mr Fee the question. There are obviously some offices and some changes in offices in Northern Ireland which would be different from those in Scotland, Wales or Westminster. Under Standing Orders, the SSRB recommendations can be changed and insertions made. It is different reducing them from adding on to them. If we were saying that we wanted 10% more than the SSRB recommended, that would be different from saying that we wanted 10% less.

Peter, in many respects, has identified the key word, which is 'justification.' I cannot justify Clause 3. Similarly, if, in 12 months' time, the SSRB time say that all Assembly Members are entitled to a pay increase of 20%, I could not justify that to myself and my constituents, and I would be objecting and opposing it. I may have difficulty with other aspects of the SSRB recommendations with regard to different allowances, but the key question is whether I am prepared to try to justify them. I am prepared to attempt to justify the other issues that have come before us. However, I am not prepared to attempt to justify this one because I do not see any justification in it.

OK, we will have to bring this to a vote now. It is decision time, unless we have any other amendments to consider. I think Mr Leslie had another amendment to propose. Is that correct?

No. That was relating to the point we discussed about the definition of salary. I think we have that matter under control, and we do not need to put down an amendment.

I would like some clarification. I find myself sympathising with points that are being made here. With respect to the matter of office holders, if there were a declaration of interest - given the definition of 'office holder', - how would that affect a vote in the Assembly? I am concerned about our overall interests.

That can cut both ways. That seems to me to be an absolutely classic further reason why we should not interfere with the SSRB recommendations. We could not then be accused of exercising an interest, whether it be a positive or negative one.

I have no interest to exercise, Mr Chairman.

Fundamentally, the Assembly has to legislate for Members' salaries, and whether it takes the form of Members dealing with their own salaries as in this case by accepting SSRB, it can still be said that they have an interest.

There are five in favour, four against, and one abstention.

I would like to raise two other points. I put on record in previous discussions that I am also unhappy about Clause 1. I understand that we cannot debate this matter now because we have other business to conduct, but I wish to put on record that I will be putting an amendment to the Assembly, and I will take guidance on that. I am also unhappy with the vagueness of Clause 4. I would prefer that any winding-up allowance be linked to something more substantial than Members being just having to say that they necessarily incurred £11,500 on expenses.

Do members want to come back to this another day, or do they want to put forward any proposals or amendments now?

I am happy to leave this to another day, when I will present the amendments that I want to make.

That will allow us to get on with the Pensions Bill. If any other member has further amendments, could they also table them when this is next being discussed. In any event, because there are references to the Pensions Bill, they will probably have to wait until after that Bill.

1. The Committee for Finance and Personnel met on 12, 19, and 27 January and 3 February 2000 to consider the Committee Stage of the Allowances to Members of the Assembly and Office Holders Bill (NIA Bill 2/99) under Standing Order 31.

7. The Committee ordered that the Minutes of Proceedings be printed in support of Report 2/99 (Committee for Finance and Personnel)[ii] on Thursday, 10 February 2000.

Mr Martin Wilson (Committee Clerk)

Mr Peter Hughes (Assistant Committee Clerk)

Ms Sharon Bowman (Administrative Support)

7.1 Mr John Fee MLA, sponsoring member of the Allowances to Members of the Assembly and Office Holders Bill (NIA 2/99) and the Financial Assistance for Political Parties Bill (NIA 3/99) appeared before the Committee on behalf of the Northern Ireland Assembly Commission. He was supported by officials.

7.2 Allowances to Members of the Assembly and Office Holders Bill (NIA 2/99).

7.2.1 Mr Fee made an opening statement and was questioned about the provisions of the Bill.

7.2.2 Agreed: The Committee raised a number of concerns about the Bill and agreed to meet again to give it further consideration. Mr Fee was asked to meet the Committee again to give further evidence on the Bill.

Mr Martin Wilson (Committee Clerk)

Mr Peter Hughes (Assistant Committee Clerk)

Ms Sharon Bowman (Administrative Support)

3. Matters Arising.

3.1 Allowances to Members of the Assembly and Office Holders Bill.

3.1.1 The matter was considered.

3.1.2 Agreed: The Committee agreed that the Bill would be considered again on Thursday, 27 January.

Mr Martin Wilson (Committee Clerk)

Mr Peter Hughes (Assistant Committee Clerk)

Ms Sharon Bowman (Administrative Support)

2.2 Allowances to Members of the Assembly and Office Holders Bill (NIA Bill 2/99)

2.2.1 The sponsor of the Bill, Mr John Fee made an opening statement. He was supported by Mr Tom Evans, Clerk to the Commission, Mr Dennis Millar, Director of Finance and Personnel, Mr Jim Hamilton, DFP. Members questioned Mr Fee on the Bill.

2.2.2 Mr Fee explained that the Commission had made a comparison between equal opportunities legislation in Northern Ireland and Great Britain and had sought legal advice. The Commission believed that the Bill did not discriminate against anyone on the grounds of sex, marital status, race, religious belief/political opinion, or disability.

2.2.3 Mr Fee accepted the Committee's concern about the intent of Clause 3 (1) (a) - 'Allowances to persons ceasing to hold certain offices'. The Commission had agreed with the Committee that the fixed period of three weeks was insufficient in relation to chairpersons and deputy chairpersons at a time of dissolution of the Assembly. Mr Fee suggested two amendments to Clause 3.

2.2.4 Agreed: The Committee agreed to recommend to the Assembly that the following motion be adopted:

2.2.5 The Committee went on to consider whether Clause 3 (which states that Members who cease to be office holders should receive an additional allowance) should be omitted from the Bill.

2.2.6 Agreed: The Committee agreed to recommend to the Assembly that the following motion be adopted:

2.2.7 Mr Maskey informed Members that he was concerned about Clause 1 and that he would personally be putting an amendment to the Assembly. He also considered that entitlement to the winding up allowance in Clause 4 needed to be tightened and that he would consider an amendment and bring it to the Committee at the next meeting.

Mr Martin Wilson (Committee Clerk)

Mr Peter Hughes (Assistant Committee Clerk)

Ms Sharon Bowman (Administrative Support)

3. Consideration of Bills

3.1 Briefing to Members

3.1.1 Allowances to Members of the Assembly and Offices Holders Bill (NIA 2/99). Draft amendments to Clauses 1 and 4 of the Bill were issued to Members for consideration. Mr Maskey, the proposing Member, considered that Clause 1, which would provide a resettlement allowance to Members, should be dropped from the Bill, and that Clause 4 should be amended to restrict the range of payments made under the winding-up allowance.

3.1.2 Agreed: The Committee voted to reject the amendment to Clause 1 that 'Clause 1 does not stand part of the Bill'. Mr Maskey withdrew his proposed amendment to Clause 4 but would consider pursuing the matter when the Bill was debated in the Assembly.

3.1.3 Agreed: The draft report on the Allowances to Members of the Assembly and Office Holders Bill to the Northern Ireland Assembly was issued to members for consideration. The Committee agreed the draft report, subject to a number of amendments.