HL Deb 02 November 1960 vol 226 cc33-9

2.55 p.m.


My Lords, since my noble friend Lord St. Aldwyn rose, I have received information that my right honourable friend, the Minister of Pensions has now begun his statement in another place, and therefore, with your Lordships' permission, T should like to make this statement in the words which my right honourable friend himself is using:

"First, War Pensions. The Royal Warrant is being amended so as to raise the basic rate of pension for 100 per cent, disablement by 12s. 6d. a week, and proportionately for lower assessments. Thus, the rate for a private with 100 per cent, disablement will be raised from 85s to 97s. 6d. The standard rate for war widows with children or for widows over 40 years of age or incapacitated will be raised by 10s. a week, with appropriate increases in the rates for their children. Thus, a private's widow in these categories will have her own pension increased from 66s. to 76s.

"There will also be increases in the allowances for constant attendance, unemployability, wear and tear of clothing, lowering standard of occupation, education, and in the maximum rent allowance payable to war widows with children.

"New provision will also be made as follows. There will be an extension of the rent allowance to cover officers' widows with children at the same rates and on the same conditions as those for the widows of other ranks with children. The constant attendance allowance, now limited to pensioners assessed at 100 per cent, for war disablement, will be extended, subject to certain conditions, to those assessed at 80 per cent. An allowance will be introduced for the relatively few pensioners who on account of exceptional disablement qualify for an award of constant attendance allowance at a rate above the normal maximum, and who none the less are ordinarily in employment.

"All these improvements will come into force on the first pay day in April next. The additional cost to the Exchequer will be about £11½ million in a full year.

"I will circulate a list of all the principal changes in the OFFICIAL REPORT.

"I am presenting to-day a Bill to increase the flat-rate benefits and flat-rate contributions of the National Insurance Scheme and to increase Industrial Injuries benefits. The Bill will be available in the Printed Paper Office at 4 o'clock this afternoon together with an explanatory White Paper and a Report by the Government Actuary. It is proposed that, if the Bill is approved by Parliament, the changes shall take effect at the same time as the start of the graduated scheme in the first week of April next.

"It is proposed that the standard rates of National Insurance flat-rate retirement pension, and of unemployment benefit and sickness benefit, shall be increased from 50s. to 57s. 6d. a week for a single person and from 80s. to 92s. 6d. a week for a married couple. The standard rate of widow's pension will also be raised to 57s. 6d. a week. There will be increases in the allowances for dependants of National Insurance beneficiaries, including an increase of 2s. 6d. in the allowances for children. In the case of the widowed mother per personal benefit will be increased to 57s. 6d. a week, like other benefits, but the allowance for each of her children will be raised by 5s This will provide allowances of 25s. a week for the first child, and of 17s. a week in addition to family allowances of each other child.

"Under the Industrial Injuries Scheme, the standard rate of injury benefit and of the 100 per cent. disablement pension will be increased from 85s. to 97s. 6d. a week. The widow's pension of 56s. will be raised to 64s. a week, and the rates for a widow's children will be increased.

"In the first year, the extra cost of the higher rates of pensions and benefits will add nearly £150 million to the expenditure of the two Funds. In a contributory scheme, improved benefits must of course be matched by increased contributions. It is proposed to retain the joint flat-rate National Insurance and Industrial Injuries contribution for an employed person not contracted out of the graduated National Insurance scheme at about the present level instead of reducing it when the graduated scheme starts next April. Contributions for other classes, which were not to have been reduced, will be correspondingly raised. There will also be an increase of about f15 million in the first year in the net amount to be provided by the Ex- chequer in accordance with the proportionate formulae for the Exchequer contributions to the two Funds.

"I should like to make it quite clear that the Bill will in no way affect the rates of graduated contributions and retirement benefit or the conditions for contracting out of the graduated scheme. The Bill makes the same increase, over the rates under the 1959 Act, in the contributions of those who are contracted out and those who are not, and so leaves their relative positions unchanged.

"The Bill also deals with a problem arising from the so-called 12 hours' rule. It provides that where a person claiming retirement pension intends to work to an extent which will enable him to earn no more than the limit of earnings laid down from time to time for the purposes of the earnings rule, the number of hours which he proposes to work shall not prevent him from being treated as retired.

"Finally, National Assistance. As the House will recall, substantial improvements were made last year in the standard of provision for those on assistance. The National Assistance Board have been informed, of the Government's proposals in respect of National Insurance. In the light of them, and of the fact that the increased pensions and benefits to be provided will have to be taken into account in calculating the need for supplementation, the Board have submitted proposals for certain increases in the scale rates of National Assistance to take effect at the same time. These proposals, which the Government have accepted, are for increases of 3s. 6d. per week for the single householder and 5s. for the married couple, with appropriate increases in the other rates. I have to-day laid the necessary draft regulations, with an explanatory memorandum by the National Assistance Board.

"The House will remember that the improvements in benefits which came into operation in 1958 raised them in real terms to higher levels than ever previously attained. So far as National Assistance is concerned, this improvement in standard was taken a stage further by the increases put into effect just over a year ago. Thanks to the high degree of stability of prices in recent years, these levels have in large measure been held. These further changes constitute, therefore, a marked improvement in the standard of those

Disablement pensions (100 per cent. assessment): Present rate Proposed rate
ex-private or equivalent 85s. a week 97s. 6d. a week
ex-non-commissioned officers Increase of 12s. 6d. a week
ex-officers Increase of £34 a year
ex-Regular officers—disablement addition Increase of £34 a year
The amounts of weekly allowances and terminal gratuities for assessments of less than 20 per cent, will also be increased proportionately.
Education allowances up to £80 a year up to £120 a year
Constant attendance allowance 17s. 6d a week 20s. a week
26s. 3d. a week 30s. a week
Normal maximum 35s. a week 40s. a week
52s. 6d. a week 60s. a week
Exceptional maximum 70s. a week 80s. a week
The constant attendance allowance, now limited to pensioners assessed at 100 per cent. for war disablement, will be extended to those assessed at 80 per cent. or 90 per cent. for such disablement, where they are 100 per cent. disabled from all causes and their need for attendance is equally great and arises mainly from the war disablement.
Allowances for wear and tear of clothing:
Lower rate £6 a year £7 10s. a year
Higher rate £10 a year £12 10s. a year
Unemployability supplement 55s. a week 63s. a week
The allowances payable with this supplement (and with treatment allowances) will also be increased—
Allowance for wife or other adult dependant 30s a week 35s. a week
Allowance for first child 15s. a week 17s. 6d. a week
Allowance for other children 7s. 6d. a week 9s. 9s. 6d. a week
Allowance for lowered standard of occupation up to 34s. a week up to 39s. a week
A new allowance of 20s. a week will be introduced for pensioners who on account of exceptional disablement qualify for an award of constant attendance allowance at rates above the normal maximum and who, despite their severe handicaps, are normally in employment.
Widows' pensions:
Widow of ex-private or equivalent 66s. a week 76s. a week
Widows of ex-non-commissioned officers Increase of 10s. a week
Widows of ex-officers Increase of £26 a year
Allowance for each child—
Other ranks 25s. a week 29s. a week
Officers £73 a year £83 10s. a year
Rent allowance for widows with children up to 25s. a week up to 29s. a week
The rent allowance is being extended at the same rates and on the same conditions to officers' widows with children.
Pensions for unmarried dependants who lived as wives of men now deceased:
Other ranks 58s. 6d. a week 68s. 6d. a week
Officers £177 a year £203 a year
Orphans' pensions:
Other ranks—
under 15 years 30s. a week 34s. 6d. a week
15 years or over 40s. a week 46s. a week
up to 18 years £112 10s. a year £128 10s. a year
Adult orphan incapable of self-support 50s. a week 57s. 6d. a week
Parent's pensions:
Increase in basic means standards used in calculating the need of parents who lost sons as a result of the 1939 War:
from 70s. a week to 80s. a week for one parent and from 105s. a week to 120s. a week for two parents, and comparable increases in the means standards applicable to the parents of officers.

receiving these benefits. This implements the policy of the Government that they should share in the rising standards of the nation."

Following is the list of changes referred to:


My Lords, I am obliged to the noble Earl. This is a most important statement, and the general trend of the announcement is one to be greatly welcomed on behalf of the war various welfare pensions schemes. I do not think it would be wise, with all the business in front of us to-day, to ask detailed questions, and perhaps it would be better for us to study the White Paper which is being issued, together with the Bill.


My Lords, I should like to follow the noble Viscount in thanking the noble Earl for his courtesy in putting this before us at the first possible opportunity, but I think the noble Earl will agree that there is so much content that it is really impossible to discuss the matter usefully at the moment. We are grateful to him for giving us the information and will study the statement.


My Lords, while not speaking officially for the ex-Service organisations, may I personally thank my noble friend for proposals which at first hearing seem to me to go a little further than might have been expected and to take even more account of the rise in the standard of living that has taken place in the last three years than the figures would have shown? I express my warm personal thanks.


My Lords, I am obliged to your Lordships, and I agree that it would be more convenient in every way to postpone detailed discussion of this subject until a later stage.