§ Mr. Rossi
In general terms at a steady rate of inflation six monthly upratings are 25 per cent. more costly each year than a single annual uprating. The net extra benefit cost of uprating retirement pension, but not other benefits, by 5 per cent. in May and November, over the cost of a single 10 per cent. increase in November, would be about £250 million, after taking account of savings in supplementary pension. The administrative costs of two upratings each year could be more than twice the cost of one uprating because of the shorter time available for implementation.
§ Mr. John
asked the Secretary of State for Social Services what would be the current value of the retirement pension if it had been fully uprated in 1978, 1979, 1980 and 1981 in line with the increase in prices or average earnings, whichever was the higher; and what would be the extra net cost to public expenditure of raising the retirement pension to this level.
§ Mr. Rossi
On the assumption that each year's forecast of earnings and price increases precisely matched the outturn, the hypothetical levels of basic pension which would now arise from the stated basis of uprating would 65W be £31.45 weekly for a single pensioner and £50.25 for a married couple. If basic retirement pensions had been increased to this level at November 1981, with other benefit rates remaining unchanged, this would have resulted in net additional benefit expenditure of over £600 million in a full year, taking account of consequential savings in supplementary pension.