HC Deb 18 February 1947 vol 433 cc969-70
51. Mr. William Shepherd

asked the Chancellor of the Exchequer the interest on capital that is allowed in determining the means of an applicant for an old age pension under the Act of 1936; whether he is satisfied that this rate is reasonable; or what steps are being taken in connection with it.

The Chancellor of the Exchequer (Mr. Dalton)

The rules for calculating means are prescribed in the First Schedule to the Act. As regards the second and third parts of the Question, I would refer the hon. Member to my reply on 24th January to the hon. and learned Member for Chester (Mr. Nield).

Mr. Shepherd

Will the Chancellor of the Exchequer say what those rates of interest are, and whether they are justified in present circumstances?

Mr. Dalton

Yes, Sir. Of course, these figures relate only to the non-contributory pensions, where the whole cost is paid by the taxpayer, and, in such cases, it is not unreasonable that a person who possesses means should be required to pay some of them into a life annuity.

Lieut.-Commander Gurney Braithwaite

But where the applicants have the misfortune to be railway stockholders, is their reduced income taken into account?

Mr. W. J. Brown

Can the Chancellor say whether there is, in fact, any relationship at all between the assumed yield of investments for the purposes of this calculation and the actual yield of Government stocks at the present time?

Mr. Dalton

The arrangements are laid down, as I have said, in the first Schedule to the Act. [HON. MEMBERS' "What are they?"] Well, it can be read in the Act, and I could read it out, but it is readily accessible. The first £25 of capital is disregarded, the yearly value of the next £375 is taken as 1/20th of the capital value, and any excess over £400 is taken as one-tenth of the capital value.