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Foreign Compensation (Czechoslovakia) Order 1982

Volume 86: debated on Wednesday 13 November 1985

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Motion made, and Question proposed, That this House do now adjourn.— [Mr. Durant.]

10.44 pm

I am grateful for the opportunity of this Adjournment debate, and I know that that pleasure will be shared by many British citizens with connections with Czechoslovakia. I am also grateful to the Parliamentary Under-Secretary of State, my hon. Friend the Member for Enfield, North (Mr. Eggar), for being here. This is the first opportunity for him to address the House from that august position on the Front Bench. All my hon. Friends will join me in wishing him the very best and thanking him for coming tonight.

My hon. Friend the Member for Ruislip-Northwood (Mr. Wilkinson) has my agreement to contribute to the debate, as well as the agreement and permission of the Minister.

The Foreign Compensation (Czechoslovakia) Order 1982 came into being through recognition by the British Government of the need to recompense British citizens forced by circumstance to leave Czechoslovakia in 1948 following the deposition of Benes and Masaryk. Several were British-born, for example the British wives of Czech men who had returned to Czechoslovakia following the second world war. Most of those who left Czechoslovakia were forced by necessity to leave only with such belongings as they could carry. Their escape to Britain was made even more difficult as many who were not Communist supporters had their passports confiscated immediately after the coup of February 1948. Forced by circumstances to leave the country, taking with them only what they could carry, most left the greater part of their belongings in Czechoslovakia, including the furnishings of their Czech homes. Those possessions were often forfeited by the Czech authorities, and in the 1940s no payment or compensation was given for that loss.

The Czech Government, after many years of negotiations, paid the sum of £24 million to the British Government, of which approximately £4 million has been set aside for the Foreign Compensation (Czechoslovakia) Order 1982. All of us in the House should acknowledge the success of those negotiations, which have carried on for many years. At least there was a positive result in the end—in other words, the compensation paid by the Government of Czechoslovakia.

All claims had to reach the Foreign Compensation Commission by 31 August 1983, and I understand that 2,204 claims have been lodged. Once submitted, a claim is given a preliminary assessment and, if it is felt to be justified, evidence has to be submitted to back up the claim. A determination of the amount of compensation can then be made. Once all the cases have been provisionally determined, they all require reviewing before a final award is made, because, if the claims exceed £4 million, successful applicants are paid a proportion of the amount set aside for compensation. Therefore, all determinations must be made before a final figure for the amount of compensation to any one applicant can be reached.

There was, and is, however, a major stumbling block in the way of most applicants in that the burden of proof rests with the applicant. According to the order, he has to show that the property in question had been affected by a Czechoslovak measure. As might be imagined, proving, after 40 years, that one's property was affected by a Czechoslovak measure is no easy matter and, by the end of September this year, of the 2,204 claims received by the Foreign Compensation Commission, 620 or about 30 per cent. had been processed, of which only 173 had been provisionally awarded compensation totalling approximately £285,000. In the two years following the final date for the submission of applications, therefore, fewer than one third have been dealt with.

To alleviate the burden of proof placed upon applicants, the Foreign Compensation Commission has frequently turned to the Czech Government for evidence, and it is there that many applications for compensation can encounter difficulties. Why that should be so is best explained by reference to the case of Mrs. Delia Hak, a British citizen who was forced to leave Czechoslovakia in 1948 and who lives in my constituency, where she was born.

Mrs. Hak married a Czech army officer in July 1945, and the newly married couple moved to Prague in October of the same year, taking £800 which had been left to Mrs. Hak in her father's will. With that money and additional funds occasionally sent by Mrs. Hak's mother, Mrs. Hak completely furnished their Prague home. After the coup in 1948 and having been put under pressure—Mr. Hak believes that they were put under surveillance by the Czech authorities—they decided that it would be better for them to leave the country.

In the late spring of 1948, Mrs. Hak succeeded in leaving Czechoslovakia by train on a Czech passport but Mr. Hak was unable to leave. In November 1948, Mr. Hak succeeded in escaping across the border, leaving behind all of the effects of the Prague flat. On leaving Czechoslovakia, he worked for the British Government. Mrs. Hak, wishing to claim compensation for the loss of the effects in the Prague flat, had to rely on the Czech Government to furnish the compensation commission with evidence to uphold her claim.

The Czech authorities replied to the commission's request saying that the Prague people's court had passed a sentence on Mr. Hak on 8 February 1954 ordering the forfeiture of all of the couple's goods to the state. However, the Czech authorities added that they had never taken possession of the effects of the Prague flat as they had been sold previously to Mr. Hak's father, which the authorities claim is proven by an affidavit signed by his father on 20 September 1950.

Mrs. Hak's claim has therefore been dismissed, although my constituents claim that the evidence submitted is incorrect. The 1982 order leaves little discretion to the commissioners. As the Hak's case stands, they are without firm evidence, so they are without compensation. Of all of the requests for information sent to the Czech Government, about 900 still await reply. Applicants who have received a reply from Czechoslovakia are not always as displeased with the outcome as my constituent. Indeed, the Commission has several cases on file of applicants whose cases appeared hopeless until the Czech Government supplied information which revealed that they are entitled to compensation. They appear to be doing their best to have the compensation problem sorted out as thoroughly as possible. Unfortunately, however, such thoroughness takes time, and time is one of the applicants' greatest enemies as many are well into their 70's.

My first request is that the Order should be reviewed to alter the burden of proof and to give the commissioners greater discretion. My second request is that my hon. Friend the Minister should set a realistic target date to clear all claims. Probably the most difficult part of the Order for claimants is the section concerning pensions. Of the 500 or so claims that have been made for compensation in respect of loss of pensions, the commission believes that less than one dozen will probably be successful.

The commission has found article 21 of the Order, which relates to pensions, too rigid for successful implementation because social security systems are different all over the world, and that to decide whether payment of the pension had been stopped
"in accordance with the rules governing the payment of the pension"
is almost impossible. Many left Czechoslovakia before the payment of their pension started, so they are really claiming for pension contributions. Hence those who claim for loss of pension have almost no chance of success. There was obviously a need for compensation for loss of pensions otherwise the article would not have been included in the Order. It would now seem foolish not to pay out that compensation because the conditions of the Order were drafted too rigidly.

My third request, therefore, is that the Order should be reviewed with special reference to pensions. It will be appreciated that many of those now claiming compensation, including that for loss of pensions, are senior citizens who cannot afford, financially or physically, to wait for years before any payments are made. As the rules of the order stand, no final substantial payment can be made until all the claims have been finally determined and then reviewed.

The difference between the amounts claimed and the amount available is illustrated by the fact that the original claims totalled £21 million but that the commission has provision to pay only £4 million in compensation. If a substantial interim payment could be made, however, it would be of great benefit to those awaiting the final review. It would alleviate some hardship and reduce, if not eliminate, concern on the part of the claimants. My fourth and final request is, therefore, that substantial interim awards should be made.

In conclusion, I call upon my hon. Friend the Minister to take whatever action he feels is necessary to ensure a more rapid procedure of the claims system, to consider a review of the order at the earliest possible date with a view to altering the present overly rigid conditions with regard to burden of proof and pension compensation, and to consider making substantial interim payments. I appreciate that there are problems in that the commission must frequently rely upon the Czechoslovak Government to provide information and that this causes complication and delay, but the money in the commission's fund is now British money and should be awarded at the discretion of the British Government and not of the Government of Czechoslovakia.

10.56 pm

I am most grateful to my hon. Friend the Member for Kettering (Mr. Freeman) for allowing me to intervene briefly in the debate. I pay warm tribute to him for the clear and forceful way in which he has put the case, which I wholeheartedly support.

My hon. Friend the Parliamentary Under-Secretary of State will know that I recently took a deputation of Czech ex-service men, including squadron leader Ludikar from my constituency, to see the Minister of State, Foreign and Commonwealth Office, my hon. Friend the Member for Mid-Sussex (Mr. Renton).

I associate myself with the plea made by my hon. Friend the Member for Kettering that the pension provisions especially be reviewed, for the good reason that many of these Czech ex-service men fought with the greatest gallantry and distinction alongside British armed forces and, in some cases, in British units in the second world war, and I can think of no group more deserving of equitable treatment in regard to their pensions. The problem is getting information out of Czechoslovakia to justify their claims which, in all equity, should be met.

10.57 pm

The Parliamentary Under-Secretary of State for Foreign and Commonwealth Affairs
(Mr. Timothy Eggar)

I am grateful to my hon. Friend the Member for Kettering (Mr. Freeman) for initiating this debate and to my hon. Friend the Member for Ruislip-Northwood (Mr. Wilkinson) for his contribution to it. I know that my hon. Friends the Members for Stratford-on-Avon (Mr. Howarth) and for Hampstead and Highgate (Sir G. Finsberg) would have liked to be here and that they, too, have been very active on behalf of constituents affected by the order.

I recognise that a significant number of people who suffered losses in Czechoslovakia a long time ago are interested in these questions and hope to receive compensation for their losses; I very much sympathise with them.

The House will be aware that the negotiations with Czechoslovakia which led to the signature of an agreement on 29 January 1982 were extremely complicated and lengthy. They began in 1949 and had many ups and downs. Their successful conclusion was not wholly within our gift nor that of the Czechoslovaks. The French and United States Governments were holding their own bilateral negotiations with the Czechoslovaks at the same time and there was a higher degree of interdependence between the three sets of negotiations.

Although the Order is long and complicated, its principal purpose is straightforward enough. It entrusts to the Foreign Compensation Commission the task of receiving applications to share in the distribution of the compensation received from Czechoslovakia. It reviews and values those claims and deals with the distribution of compensation to claimants in proportion to the valuation assigned by the commission to their claims.

As my hon. Friend has said, the total sum of money handed to the Foreign Compensation Commission for private claimants in October 1982, was almost £4 million. I am pleased to tell the House that with interest that sum now stands at almost £4·75 million. The 1982 Order gave applicants 12 months in which to make their claims to share in the compensation. A large number did so. Whereas our negotiations with the Czechoslovaks had been concerned with only 1,254 private claims with a face value of some £6 million, no fewer than 2,204 persons applied to take part in the distribution. My hon. Friend might like to know that the nominal value of the applications filed up to the closing date, 31 August 1983, had risen to some £21 million rather than the £6 million which we were previously talking about.

I understand that my hon. Friend the Member for Kettering spoke of his concern about the pace at which the Foreign Compensation Commission is reaching decisions. Indeed, he has asked me to review the whole order, with a view both to altering the burden of proof placed upon the applicants and also to setting a target date for the clearance of all the claims. While I share my hon. Friend's concern that matters should be speeded up, I am sorry to have to say that there is no possibility of altering the burden of proof. That must still rest upon the applicants. It seems to me proper that in the case of this order, as with all similar orders, it should be the responsibility of the claimant to establish his own claim. No one else can shoulder that responsibility.

My hon. Friend has spoken of the requests for information in support of claims which the Foreign Compensation Commission have made to the Czechoslovak authorities. Provision was made for that in our agreement with Czechoslovakia. That provision has been of substantial benefit to us and to the claimants. I take this opportunity to pay tribute to the response that we have received from the Czechoslovak Government. Many of the replies they were able to give us were valuable. So far, they have sent 578 replies to the 1,700 requests made by the Foreign Compensation Commission. On further reflection, the commision has withdrawn 225 of those requests and the balance outstanding is still some 900.

I should emphasise to my hon. Friend that we have sought additional information from the Czechoslovak authorities which the claimants were unable to provide. We asked for that additional information in order to verify the claims. We have not asked the Czechoslovak authorities to verify documents produced by the claimants. The information supplied by the Czechoslovak authorities is treated as evidence which may or may not support the claim, and is read in conjunction with the applicant's own submission. Nothing can replace the applicant's own submission. I should like to make that clear. That submission is of primary and fundamental importance to the whole procedure.

As I said, I share my hon. Friend's regret that it has not been possible to proceed faster. In many cases, the difficulty has lain in the 40 years which have elapsed between deprivation and the moment of claim, and the slowness with which evidence has been coming forward. However, I have to say that it has often been in the claimants' own interest to allow adequate time for the production of such evidence.

My hon. Friend invited me to set a realistic target date for the clearance of all claims. However, as I know my hon. Friend is aware, the FCC is independent in these matters, and I hope he will understand my reluctance to accept his invitation. At this stage, it is better to concentrate upon ways and means of speeding up the procedures of the FCC and the rate at which it makes determinations. The commission is already considering ways of doing that, and I trust that it will be successful. I hope that it will feel able to reach at least provisional decisions in some cases without waiting for replies from Czechoslovakia, especially where the request for information was sent to the Czechslovaks some time ago.

My hon. Friend gave details of the claims for compensation which Mr. and Mrs. Hak have made to the FCC, and he referred to the sad circumstances which led to that claim being made. As he knows, the claimants have put their cases to the commission and the legal channels open to them are not yet exhausted. This being so, I hope that my hon. Friend will understand when I say that it would not be right for me to comment here upon either case.

My hon. Friend and my hon. Friend the Member for Ruislip-Northwood asked that there should be a review of the order in so far as it bears upon pension claims. I realise that some claimants were members of the allied armed forces during the second world war and gave distinguished and gallant service then. They have since come to Britain and made their homes here, but they were not British nationals at the relevant time when they lost their pension rights in Czechoslovakia and so, sadly, do not qualify under the provisions of the Czechoslovakia order. I must tell my hon. Friend that we reviewed this matter very carefully last year, when we received representations from my hon. Friend the Member for Stratford-on-Avon (Mr. Howarth) and concluded that it would be wrong to amend article 21 of the order, which bears upon pension claims. I will explain briefly the reasons behind our decision.

In preparing the 1982 order, the Government thought it right to make provision for some of the compensation received under the 1982 agreement with Czechoslovakia to be used for the benefit of the very limited category of pension claimants described in article 21. Since we had been negotiating with the Czechoslovak Government about compensation for the loss of British property, it was inevitable that the text of this article should be drawn in such a way as to benefit only those who met a strict British nationality requirement.

We also had a duty to consider the position of all the other claimants under this order. We could not act to their detriment without having a sound legal justification for this. In the present case, we concluded that such a legal justification did not exist and that it would not be proper for us to attempt to relax the nationality requirement. All other claims under this order are subject to a strict nationality test based on international law. That has been our consistent practice in all orders in Council providing for the distribution of compensation moneys received from other Governments. I am sorry to disappoint my hon. Friend, but I do not believe it would be right for us to reconsider the decision that we reviewed as recently as a year ago.

My hon. Friend also asked me to consider the case for a substantial interim payment to claimants. I listened carefully to what he said and have much sympathy with him. As he argued, all the claimants have already been waiting a very long time. Nevertheless, it may be prudent for the commission to make more progress on the claims before considering an interim payment. The commission is not even halfway through its work. I remind him that there have so far only been 630 decisions in 2,200 outstanding cases.

However, I do not wish my hon. Friend to think that I oppose the idea of an interim payment. If the facts support it, I will be prepared to suggest a substantial interim payment to the FCC at the appropriate time. If I do so, I shall have to bear in mind the fact that an interim payment or payments would necessarily involve a diversion of administrative resources from the commission's principal task of determining these claims as quickly as possible.

If procedures can be devised for the more speedy determination of these claims and swift progress proves possible; it might be better for the commission to press ahead and reach provisional decisions in all cases before calculating how much can be paid to each claimant. We should preserve an open mind on this issue until we see whether or not the Commission can make better progress over the next few months. I can assure my hon. Friends that I shall be keeping a very close watch on this.

Finally, my hon. Friend the Member for Kettering has emphasised that all these claims are a matter for British decision. I agree with him, and so does the FCC. Primarily, the commission's responsibilities are involved here. I acknowledge and to some extent agree with my hon. Friend's disappointment at the rate of reaching decisions under the order during the first two years since the closing date for the submission of claims—since mid-1983. I hope that the commission will be able to follow procedures that will inject more speed into this exercise. I attach importance to its doing so in order that claimants may receive compensation in the near future.

The commission is already aware of my concern and that of my hon. Friends who have spoken tonight and of other hon. Members who have been involved with this over the years. I have no doubt that it will respond to the concern expressed in the debate. I am sure that it will be reading carefully what has been said tonight.

Question put and agreed to.

Adjourned accordingly at eleven minutes past Eleven o'clock.