HC Deb 17 February 1964 vol 689 cc837-8
21. Mr. Carmichael

asked the Minister of Pensions and National Insurance what proportion of the cost of all National insurance benefits, including retirement pensions, was met by the Exchequer in 1951 and 1963, respectively.

Mrs. Thatcher

In 1951–52 the Exchequer contributed some 21 per cent. of the income of the National Insurance Fund. The cost of benefits in that year was, however, covered to the extent of nearly 90 per cent. by contributions of insured persons and employers. For 1963–64 the Exchequer contribution is estimated at about 15 per cent. of the Fund's income, all of which will be required for the payment of benefit.

Mr. Carmichael

Is this Answer not evidence of the deterioration in the distribution of income over the last 12 years under the present Government, in that income for pensions has been more and more taken from the wage and salary earners? Is it not time for a return to the principle of the Exchequer meeting a larger proportion of these pensions?

Mrs. Thatcher

In the year 1951–52 the Fund's income exceeded its expenditure by £101 million, which is almost the same as the total Exchequer payment of £109 million. This year Exchequer support will be £212 million, and every penny of that will go out in benefit payments.

Mr. Mitchison

Is it not the case that the Exchequer contribution's share of the total has been going steadily down all the time? Is it not also the case that the Treasury has done disgustingly well out of National Insurance?

Mrs. Thatcher

The hon. and learned Member perhaps will be aware that because of excess income over expenditure in 1951–52 the then Labour Government took action to reduce the Exchequer contribution. When that Act took effect the Exchequer contribution became 13½ per cent. of income, a lower proportion than it is now.