HC Deb 30 January 2002 vol 379 cc411-3W
Paul Goggins

To ask the Secretary of State for Work and Pensions what estimate he has made of the number of pensioners in Wythenshawe and Sale, East who(a) qualify for and (b) claim the minimum income guarantee; and how many will be eligible for the new pension credit. [30882]

Mr. McCartney

The information is not available in the format requested. Such information as is available is as follows:

As at August 2001 there were 4,700 minimum income guarantee (MIG) claimants in the Wythenshawe and Sale, East constituency.

Estimates of the number of people who may be eligible for, but who have not claimed the MIG are not available below national level.

It is estimated that around half of all pensioner households, that's over 5 million pensioners, stand to gain from the introduction of pension credit.

Mr. Ivan Henderson

To ask the Secretary of State for Work and Pensions how many applicants there have been to date for the minimum income guarantee from pensioners within the Harwich constituency; how many have been approved; and what estimate he has made of the total number of potential applicants. [30981]

Mr. McCartney

The information is not available in the format requested. Such information as is available is as follows:

As at August 2001 there were 4,200 minimum income guarantee (MIG) claimants in the Harwich constituency.

Estimates of the number of people who may be eligible for, but who have not claimed the MIG, are not available below national level.

Mr. Tom Harris

To ask the Secretary of State for Work and Pensions how many pensioners in Glasgow, Cathcart constituency are benefiting from the minimum income guarantee. [31214]

Mr. McCartney

As at August 2001 there were 2,500 minimum income guarantee claimants in the Glasgow, Cathcart constituency.

Lynne Jones

To ask the Secretary of State for Work and Pensions what are the projected additional annual costs at current prices for each of the next 35 years for(a) the annual uprating of the minimum income guarantee in line with average earnings, (b) the pensioner credit, (c) raising the level of the basic state pension to the level of the MIG for (i) all pensioners,(ii) all pensioners over 75 and (iii) all pensioners over 80 years and (d) the annual uprating of the state second pension in line with average earnings. [20235]

Mr. McCartney

[pursuant to his reply, 17 January 2002, c. 45–0W]: The information requested for (b) is set out in the paper "The Pension Credit: long-term projections", which has been placed in the House Library.

The additional information requested is set out in the tables:

(a) Additional annual costs of earnings uprating of minimum income guarantee (MIG)1
Year £ billion
2002 0.4
2003 0.6
2004 0.7
2010 1.0
2020 3.0
2030 7.0
2040 9.0
2050 11.0
12001–02 prices

(c) Annual costs in 2001–02 prices of increasing the basic state pension to the level of the Minimum Income Guarantee and then uprating by earnings thereafter
£billion
Year All Over 75s Over 80s
2002 8.5 3.8 2.2
2005 10.7 4.7 2.8
2010 15.8 6.6 3.9
2015 21.3 8.9 5.3
2020 27.5 12.1 7.0
2025 36.8 17.3 9.6
2030 48.6 22.2 13.6
2035 61.0 28.5 17.1
2050 92.3 51.4 34.1

(d) Annual costs in 2001–02 prices of earnings uprating state second pension (S2P)
Year £billion
2002 0.0
2005 0.0
2010 0.0
2015 0.1
2020 0.3
2025 0.7
2030 1.2
2035 2.0

Notes:

1.All costs are for Great Britain.

2.The costs of earnings uprating of the MIG are rounded to the nearest one billion pounds from 2010 onwards. Costs are not available for every year requested.

3.The costs of earnings uprating of the MIG assumes that pensioners' incomes grow over the long term at the same pace as average earnings and the distribution of earnings is the same over time in earnings terms. Average earnings are assumed to grow in line with Treasury economic assumptions until the end of the Parliament and then 1.5 per cent. above inflation over time.

4.The costs of earnings uprating of the MIG are calculated as compared to price uprating. Because pensioners' incomes tend to grow over time faster than inflation, the costs of the MIG under price uprating would fall dramatically over time as ever fewer pensioners would be entitled to ever smaller amounts. The costs of increases in the basic state pension and state pension are net of income related benefit savings that would be generated by these increases.

5.The costs of increases in the basic state pension and state second pension are net of income related benefit savings that would be generated by these increases.

6.The costs given for earnings uprating of second state pension assume that expenditure on SERPS (accruals up to 2001–02) would not be affected.

7.The costs of earnings uprating of the state second pension only begin to become significant by 2015 because S2P only begins accruing in 2002–03 and therefore the amount of S2P in payment will he negligible for some time after that.

8.The costs shown for state second pension in the table have been calculated based on the estimated costs of S2P which were shown in the report by the Government Actuary on the Financial Effects of the National Insurance Fund of the Child Support, Pensions and Social Security Bill 1999 (Cm 4573). The costs shown are the increase in expenditure over and above the baseline projected S2P expenditure shown in this report.

9.It has been assumed that the basic state pension and state pension changes would not happen together. If they did, there would be an interaction because the lower earnings limit is linked to the basic state pension. This means that the cost of S2P would be reduced if the basic state pension and, therefore, the LEL were raised.

10.The pensioner population is assumed to grow according to GAD's central population growth estimates.

Source:

The Government Actuary's Department