§ 18. Sir J. Langford-Holtasked the Minister of Social Security whether she is aware that on page 5 of the new guide to supplementary pensions for people under pensionable age it is stated that for supplementary pension purposes capital of £2,000 is assumed to produce an income of £7 per week; and how this figure is calculated.
§ Mr. LoughlinYes, Sir. Under the Act capital over £800 is treated as equivalent to a weekly income of 2s. 6d. for 931 each complete £25. This is higher than the actual income which the capital would produce, because it is right, in a scheme of supplementary benefits, to assume that people with substantial sums of capital should draw on them to some extent for day-to-day living expenses.
§ Sir J. Langford-HoltWhen those needs are prolonged, to what extent are these people intended by the Minister's policy to draw on these reserves?
§ Mr. LoughlinProvided that recipients of supplementary benefit have no other source of income, they can have up to £2,000 and still be entitled to supplementary benefits. Under the old National Assistance scheme the capital allowed was £600. There has been a substantial improvement in that respect since we came to power.
§ Mr. RankinCan my hon. Friend tell me where £2,000 could be invested to produce an income of £7 a week?
§ Mr. LoughlinMy hon. Friend evidently misheard the Answer to the Question. What I said to the hon. Member for Shrewsbury (Sir J. Langford-Holt) was that we did not expect them to get an income out of interest on that basis but that they were expected to use some of their capital for day-to-day living purposes.