§ Mr. Lawsonasked the Minister for the Civil Service what has been the percentage annual increase under the Pensions (Increase) Act 1971 for each year since that Act came into force (a) in the rate of Civil Service pensions and (b) in the capital value of such pensions; and what are the best estimates for the comparable figures for the current year, in the light of the increase in Civil Service pay announced this month.
§ Mr. Charles R. MorrisThere have been three cost-of-living reviews of Civil Service pensions since the Pensions (Increase) Act 1971 came into force. From 1st December 1972 pensions were increased by 9.9 per cent. to cover the 15-month period from September 1971. From 1st December 1973 and 1st December 1974 increases of 9.3 per cent. and 16.5 per cent. were made to cover322W 12-month periods. It is estimated that these three reviews resulted in increased annual costs of some £10 million, £10 million and £20 million respectively.
The increase to be given from 1st December this year depends on the movement in the retail prices index for the period June 1974 to June 1975 and will not therefore be known until the end of July. The latest available figures show an increase of 14.4 per cent. to March 1975.
The effect of the recently announced pay awards on the costs of pensions increase in the 1975 review will be very small. Only those pensioners retiring between 1st January and 30th June 1975 will receive both some addition to their pensionable pay and an increase in their pensions from 1st December. Such pensioners represent a small proportion of the total and the cost of the 1975 review is unlikely on this account to be increased by more than ½ per cent.