§ Dr. David Owenasked the Chancellor of the Exchequer if he will investigate the circumstances in which the National Insurance Fund estimate produced in June, 1967, by the Government Actuary was shown to be wrong in January, 1968; and if he will take steps to ensure that this is not repeated.
§ Mr. DiamondThe circumstances leading to the changes in the estimates have been investigated by the Government Actuary and are described in paragraph 5 of his Report (Cmnd. 3532). The Government Actuary's estimates are based on the information available at the time they are made and it is not always possible to foresee changes in the trends on which the forecasts are based. As regards rates of unemployment to be assumed, he takes instructions from the Government, as explained in his reports.
§ Dr. David Owenasked the Chancellor of the Exchequer whether the Government Actuary in his calculations for the Public Expenditure and Receipts Bill assumed that earnings would remain constant over the next three years; and whether this figure was assumed until the year 2005.
§ Mr. DiamondThe assumptions made by the Government Actuary regarding earnings up to 1969–70 in his estimates for the Public Expenditure and Receipts Bill are described in paragraph 12 of Cmnd. 3532. These assumptions correspond to those used in each of the Government Actuary's reports on the National Insurance Fund since 1964. No revision of long-term estimates has been made on this occassion.
§ Dr. David Owenasked the Chancellor of the Exchequer what he estimates to be the saving to the National Insurance Fund of a reduction in unemployment for the years 1968–69 and 1969–70 to 1½ per cent. and 1 per cent. respectively; and, over this period, what is the level of unemployment on which the Government Actuary's figures in Command Paper No. 3532 are calculated.
§ Mr. DiamondThe savings in the National Insurance Fund from reductions in the cost of unemployment benefit and250W corresponding increases in contributions and Exchequer supplements, as compared with the estimates in Cmnd. 3532, are estimated to be £60 millions with an average rate of unemployment of l½ per cent, in 1968–69 and £85 million with 1 per cent, unemployment in 1969–70. For the estimates in Cmnd. 3532 the Government Actuary assumed on Government instructions that unemployment would fall by 1969–70 to the long-term rate of 2 per cent, previously adopted.
§ Dr. David Owenasked the Chancellor of the Exchequer, in view of the results already obtained over the last 20 years by the Government Actuary's department in relation to the financing of the National Insurance Fund, what estimates he has now made of the statistical probabilities of the Fund running into an estimated deficit by 31st March, 1969 and 31st March, 1970, respectively.
§ Mr. DiamondThe Government Actuary's Report (Cmnd. 3532) indicates that, with the increased contributions proposed in the Public Expenditure and Receipts Bill, the National Insurance Fund is not likely to run into deficit on current working before 31st March, 1970.