Legislative clauses in the Public Service Pensions Bill: the Henry VIII legacy

In Autumn 2012, the Public Service Pensions Bill was presented to parliament with publically made government guarantees that it represented a 'generous deal' and a 'settlement for the generation', fixing pensions for the next 25 years. The bill contains a breathtakingly wide-reaching Henry VIII clause, which gives this and future governments unprecedented powers to amend any legislation and to make unilateral and retrospective changes. Where exercised, this could adversely affect hundreds of thousands of people.

The current public pensions legal framework (and existing safeguards) is set out in the Pensions Act 1995 and Superannuation Act 1972. These soon to be replaced acts prevent such retrospective amendments. However, the bill has the potential to adversely affect accrued pension rights. This is likely to result in legal challenges to the bill if enacted, including challenges under the Human Rights Act 1998. It is worth highlighting that MPs' pensions fall outside these changes, begging the perhaps quixotic question as to why the majority of public workers' pensions cannot be similarly ring-fenced.

The British Medical Association (BMA) is leading the charge in resisting these changes and campaigning for the Henry VIII clause to be removed or at least subject to significantly tighter safeguards.

Constitutional corruption

A Henry VIII clause is a provision that enables the government to repeal or amend legislation by way of delegated (secondary) legislation, without the need for parliamentary debate. This is legislation via the backdoor, denying parliament the opportunity to subject the measures being passed to the necessary degree of scrutiny.

Henry VIII clauses are counter-democratic and effectively undermine parliamentary sovereignty. The bill most worryingly allows for retrospective changes: such as taking away accrued benefits including reducing accrued final salary rights and amendments to the PSPB including: drastically changing the design of the pension schemes and its regulations as set out in section 7 and amendments to relevant pension statutes that are not yet enacted.

Support for this view is found at the highest level. Henry VIII clauses have been robustly criticised as a 'constitutional oddity' which must be 'clearly limited, exercisable only for specific purposes, and subject to adequate parliamentary scrutiny' (House of Lords Constitution Committee, Sixth Report on the Public Bodies Bill, 4 November 2010). At the Lord Mayors' Annual dinner for Judges in July 2010, the Lord Chief Justice Judge recommended that they be 'confined to the dustbin of history'.

In its recent report on the bill, the Delegated Powers and Regulatory Reform Committee agree that the current Henry VIII clause should be substantially limited.