§ Mr. Churchillasked the Minister for the Civil Service what has been the cost to the taxpayer of making Civil Service pensions inflation-proof under the terms of the Pensions Increase Act 1971 for each of the years 1972, 1973 and 1974; 40W and what would be the cost for the current year assuming an inflation rate of no more than 25 per cent.
§ Mr. Charles R. MorrisFor figures relating to the 1972, 1973 and 1974 reviews I would refer the hon. Member to the reply I gave the hon. Member for Blaby (Mr. Lawson) on 23rd April—[Vol. 890, c.321–322.] In that reply I also said that the percentage increases to be given from 1st December 1975 will not be known until the end of July. However, assuming a 25 per cent. increase from 1st December, the annual cost of Civil Service pensions would rise by some £40 million. The cost to the taxpayer is less than these figures suggest since pensions are taxed as earned income.