§ Mr. Kirkwoodasked the Secretary of State for Social Services what study he has made of the rule imposing an abatement of unemployment benefit suffered by men between the ages of 60 and 65 years who are made redundant during that time but have small levels of income from occupational pensions; and what would be the cost to the Exchequer of abolishing the rule.
§ Mr. NewtonThe abatement provision applies to occupational pensioners aged 60 or over who have their unemployment benefit reduced by 10p for each 10p of their occupational pension in excess of £35 a week, whether they have been made redundant or taken early retirement and whether these events took place before or after the claimant reached age 60. The Department has not carried out any specific studies into the effect of this rule.
It is estimated that the cost of abolishing the rule would be around £41 million in the first full year, although this would reduce to about £28 million in a year. The higher cost in the first year is because there are many occupational pensioners who have not claimed unemployment benefit from April 1981 onwards, because it would have been extinguished, but who could claim and get up to a year's benefit if abatement ceased to apply.