HC Deb 04 March 1976 vol 906 cc734-5W
Mr. Kenneth Clarke

asked the Secretary of State for Social Services what reply she has sent to Mr. Jack Jones' proposal that the retirement pension for a married couple should be raised by a further £3.30 each week in July of this year; what is her estimate of the cost of implementing such a proposal; and what would be the effect on the level of national insurance contributions.

Mr. O'Malley

To increase the married couple's standard rate of retirement pension by £3.30 a week would cost some £1,300 million a year assuming that other social security benefits, including supplementary benefit, were raised in proportion. The effect of such an uprating on contribution levels would depend on the extent to which it exceeded what the earnings-related contribution rates set for 1976–77 would bear; this would need to be evaluated at the next contribution review—for 1977–78—in the light of up-to-date figures of earnings movements which govern contribution yields. No reliable estimate could therefore be made at this stage.

Mr. George Cunningham

asked the Secretary of State for Social Services what is her estimate of the reduction in the numbers and value of retirement pensions payable in 1977–78 if the amendment indicated by the Government in paragraph 7, page 101, of Command Paper No. 6393, were adopted in comparison with the number and value under present legislation; and what is her estimate of the tax loss of the proposed change.

Mr. O'Malley

It is estimated that the numbers receiving retirement pensions on their own records in 1977–78 will be reduced by 25,000 and that this number will include 15,000 married men whose wives are either over 60 and have no entitlement to retirement pension on their own records or are under age 60 and are dependent on their husband's records. At present pension rates the cost of retirement pensions and of increases of retirement pension and invalidity pension for adult dependants will be reduced by about £40 million in 1977–78 on which sum about £10 million would have been payable in income tax at preesnt tax rates. These figures do not take account of resulting changes in contribution liability.