§ Mr. Teddy Taylor
asked the Secretary of State for Social Services why no benefits in pension entitlement accrue to women who retire in the month of March at age 60 years in respect of the period of full national insurance contributions paid for the period from the April prior to retiral to the month of March when they retire; and if he will take steps to enable such persons to reclaim the contributions for the 11-month period in question.
§ Dr. Boyson
The final period to be taken into account for calculation of an individual's retirement pension entitlement is the tax year which ends on 5 April preceding the attainment of pension age. The inclusion of contributions paid after this date in the calculation of entitlement would necessitate a provisional pension award pending notification to the Department of the individual's final part-year of contribution payments. A recent study by officials of the Department concluded that such a system would produce reduction in standards of service and an unacceptable increase in administration costs.
It has long been a principle of the national insurance scheme that contributions properly paid are not refundable and the Government have no plans to change this. The converse of these arrangements applies in relation to the first three tax years in a person's working life. Credits are fully available to the extent necessary to make those years qualifying years for pension purposes regardless of the date on which the contributor's 16th to 18th birthdays fall. To make refunds for contributions paid during the final tax year before retirement would constitute a loss of £30 million per annum at 1981–82 prices, and require an increase of over 100 staff to process the claims.