7. What recent discussions he has had with the Armed Forces Pay Review Body on levels of pay for the armed forces. (900299)

Ministers are in regular contact with the Armed Forces Pay Review Body as part of the annual pay round process. I gave oral evidence to the review body last November prior to its 2017 report, and I expect to meet it again prior to its 2018 report.

Given that every Minister, including the Defence Secretary, voted against lifting the pay cap, does that not prove that their praise is more hollow words than good deeds?

We all want to see people in public service, including in the armed forces, properly remunerated for what they do, but any pay settlement must obviously take account of taxpayers’ interests and be fair to our need to get our deficit under control. We are advised by an independent pay review body that, unlike some other pay review bodies, it is specifically required to look at comparability with the civilian sector and to take account of any evidence regarding recruitment and retention.

At times when general employment levels rise and unemployment levels fall, and with the continued strength of our economy, it gets more and more difficult to recruit and retain armed forces personnel. Will those be key factors in the consideration of this issue?

My hon. Friend is right. We are competing for the best of every generation against other sectors of the economy, which of course are growing. The Armed Forces Pay Review Body, in recommending a 1% pay rise in its last report, said:

“We believe that…an increase of one per cent in base pay…will broadly maintain pay comparability with the civilian sector.”

Further to that last question, figures released to me last week by the Secretary of State’s Department in a written answer show that recruitment to our infantry fell by 18% in the last year alone. Does he not accept that not giving a fair pay rise is having a direct impact on recruitment?

That is not the view of the Armed Forces Pay Review Body. As I have just indicated to the House, the pay review body believes that its settlement, recommended last year, does maintain pay comparability with the civilian sector. Some 8,000 people joined the armed forces in the last 12 months, but when the pay review body comes to make its recommendation for next year, it will of course look specifically at the evidence on recruitment and retention—and it does that in a way that some other review bodies are not able to do.

After losing her majority at the general election, the Prime Minister has now signalled that she is prepared to work across the House with other parties on areas of agreement. In that spirit, I make a constructive offer. The Government have just introduced the Armed Forces (Flexible Working) Bill in the other place. If the Government agree to amend the Bill to include a real-terms pay rise for our armed forces personnel, they can count on Labour’s support, so will they agree to work with us to give our armed forces the pay award they deserve?

We all want to see our armed forces properly remunerated for the service they give us, but it is also incumbent on the hon. Lady to make it very clear how any increase she favours would be properly paid for. That is something she has not done and her party has not done—it certainly did not do it at the last election. The pay review body system is beyond party politics in this House. It is an independent pay review body that looks at comparability with the civilian sector, looks at the issue of retention and recruitment and makes its recommendation, which last year we accepted in full.

On the contrary, our manifesto was fully funded, and the Government know that. They know how to raise taxes if they need them. The fact is that the Armed Forces Pay Review Body is severely constrained by the overall 1% cap on public sector pay that the Government have imposed. If the Government will not legislate for a pay rise, will the Secretary of State at least allow the pay review body to carry out a mid-year review and report on what our armed forces should be receiving if the cap were not in place?

I am staggered that the hon. Lady thinks her manifesto was fully costed or, indeed, fully funded. There were billions in that manifesto that were due to be borrowed and paid for by future generations. We have implemented the pay review body’s recommendation in full for this financial year and, for next year, evidence is already being acquired by the pay review body. I will give my evidence to the pay review body later in the year, and we will see what it recommends.