§ Mr. Arthur Lewisasked the Minister for the Civil Service whether he will give, for the latest and most convenient stated date, the total costs of the non-contributory pensions of civil servants; to what extent there would be a saving on public expenditure if civil servants paid for their pensions on a similar basis to local government officers, police, firemen, miners and other public servants; and if, in view of the Government's policy of further cuts in public expenditure, he will introduce this system.
§ Mr. Charles R. MorrisExpenditure on Civil Service pensions is met from the Vote for Civil Superannuation, etc.—Class XIV, Vote 6—the net Estimate for which in 1976–77 is £276.16 million. The increases due to be paid from 1st December 1976, which I announced on 19th July, are expected to cost £31 million in a full year and will thus increase expenditure in 1976-77 to about £286.5 million.
As I explained in the reply I gave to the hon. Member for Rushcliffe (Mr. Clarke) on 8th December 1975, civil servants forgo pay to help meet the cost of their pensions equally as if their pensions were contributory. A contributory scheme on a similar basis to those for local government employees, policemen, firemen, miners and other public servants would therefore imply correspondingly higher pay for civil servants. It would also require a more complex and costly administrative machine to operate such a scheme; a change from the present basis would therefore be likely to lead to an overall increase in public expenditure.
§ Mr. Arthur Lewisasked the Minister for the Civil Service whether he will give 130W details of the total number of persons in receipt of pensions who will receive increases, recently announced under the pensions increases to former civil servants, judges, etc., the total weekly or annual amounts of pensions drawn; and to what extent these total annual or weekly amounts will be increased by the upgrading of such pensions; and whether, in view of the Government's declared policy of cutting Government expenditure, he will stop or reduce these increases.
§ Mr. Charles R. MorrisAt present there are over 1 million public service pensioners who are covered by the provisions of the Pensions (Increase) Act 1971. Not all these will receive this year's increase, as some will be ineligible—for example, because they are below the qualifying age. The total cost of the public service pensions for the financial year 1976–77 is estimated to be about £1,140 million. The increase payable from 1st December 1976 will be 13.8 per cent., with increases of 19.2 per cent. and 8.8 per cent. for those who retired between 1st July 1975 and 31st December 1975 and between 1st January 1976 and 30th June 1976 respectively. The cost of the increase for the public services in a full year will be about £114 million.
The average public service pension is now less than £17.50 a week, and the average increase will be only about £2.40 a week. The Government believe that pensioners with this level of income should not be a prime target for expenditure cuts.