HC Deb 30 June 1969 vol 786 cc20-1
44. Mr. Boyd-Carpenter

asked the Secretary of State for Social Services if he will make a statement as to his intentions in respect of increasing pensions earned under the graduated pension provisions of the National Insurance Act, 1959.

47. Sir B. Rhys Williams

asked the Secretary of State for Social Services what changes he proposes to make in the existing State earnings-related pension scheme ; and on what date they will take effect.

Mr. Ennals

Under the Bill now before Parliament it is proposed to raise the rate of contributions on earnings between £18 and £30 a week from half per cent. to 3¼ per cent. for employer and employee from 3rd November, 1969. When the Government's proposed new scheme starts, the existing graduated scheme will be wound up, but pensions already earned will be preserved and will be included in the two-yearly reviews of benefit rates. The target date for the new scheme is April 1972.

Mr. Boyd-Carpenter

Does that Answer mean that the hon. Gentleman does not propose to do anything to meet the representations made by those responsible for pension funds on the subject of the retrospective change of the option under the 1959 Act?

Mr. Ennals

There have been representations taking a variety of different points of view concerning this matter. It would be absolutely impossible to satisfy all those who make representations which are directly contrary to each other.

Sir B. Rhys Williams

If the graduated pension scheme is to be changed, would it not be better to put it on the basis of a higher rate of interest rather than to relate it to the cost of living?

Mr. Ennals

I do not think that would be a satisfactory answer.

Lord Balniel

Why do the Government consider the provision of a taxpayers' subsidy for the graduated pension scheme is of higher priority than the provision of pensions for the over-80s or the civilian disabled?

Mr. Ennals

There is a priority to give some justice to those who, under the right hon. Gentleman's scheme, have not had any opportunity of seeing their pensions rise but of seeing them shrivel. This is a priority, and this is why the Government announced their decision.