Social Security Reform

HC Deb 03 March 1986 vol 93 cc66-9W

Mr. Meacher

asked the Secretary of State for Social Services (1) whether he will publish tables comparable to tables P5 and P6 of the technical annex to "Reform of Social Security", showing pension projections for widows on the assumption that their husbands die at the age of 60 years;

(2) whether he will publish tables similar to tables P5 and P6 of the technical annex to the White Paper, "Reform of Social Security", Cmnd. 9691, but assuming that the husband died at the age of 64 years.

Mr. Newton

[pursuant to his replies, 13 February 1986, c. 525–26 and 17 February 1986, c. 69–70]: The information requested is given in the tables. Tables P5B and P5C correspond to table P5 of the technical annex to the White Paper, and tables P6B and P6C correspond to table P6. The rates of personal pensions and occupational money purchase pensions in the tables are higher than those in the corresponding tables in the technical annex. This is because the figures in the technical annex are based on the assumption that the husband takes his pension at age 65 and that the widow's pension from his scheme is worth half of his pension. But the figures in the tables following assume that the husband dies before drawing his pension from the scheme and that the widow's pension is equivalent in value to a pension or annuity resulting from the total sum accumulated in his individual pension savings account.

Table P5B Widows Retiring in 2008 Onwards* Pension projections (£ per week at November 1985 prices)
			Personal Pensions	Occupational money purchase pension schemes
Age in 1988	Earner	Modified SERPS	Rebate only	Rebate + 2 per cent.	Rebate + 2 per cent.	Rebate + 4 per cent.
		†rrr=3 per cent.	rrr=3.5 per cent.	rrr=4 per cent.	rrr=3 per cent.	rrr=3.5 per cent.	rrr=4 per cent.	rrr=3 per cent.	rrr=3.5 per cent.	rrr=4 per cent.	rrr=3 per cent.	rrr=3.5 per cent.	rrr=4 per cent.
20	Low	61	70	73	76	83	87	91	84	88	92	97	102	108
	Middle	85	102	107	114	130	138	147	132	140	150	160	172	184
	High	112	134	142	152	175	188	202	179	191	206	222	238	257
30	Low	59	62	63	64	69	71	73	70	72	73	78	80	82
	Middle	82	88	91	94	106	110	114	108	112	116	126	131	137
	High	106	113	117	121	139	145	150	141	147	153	168	175	183
40	Low	56	55	56	56	60	60	61	60	61	62	65	65	66
	Middle	80	79	80	81	89	90	92	90	91	93	100	102	104
	High	102	99	100	102	115	117	120	116	119	121	133	136	140

Table P6B Widows Retiring in 2008 Onwards* Pension projections (£ per week at November 1985 prices)
			Personal Pensions	Occupational money purchase pension schemes
Age in 1988	Earner	Modified SERPS	Rebate only	Rebate + 2 per cent.	Rebate + 2 per cent.	Rebate + 4 per cent.
		†rrr=3 per cent.	rrr=3.5 per cent.	rrr=4 per cent.	rrr=3 per cent.	rrr=3.5 per cent.	rrr=4 per cent.	rrr=3 per cent.	rrr=3.5 per cent.	rrr=4 per cent.	rrr=3 per cent.	rrr=3.5 per cent.	rrr=4 per cent.
20	Low	59	68	70	73	79	83	87	80	84	88	91	96	102
	Middle	84	100	105	111	125	132	140	127	134	142	152	161	172
	High	110	132	140	148	169	180	192	172	183	195	209	224	240
30	Low	56	58	59	60	65	66	67	65	66	68	71	73	75
	Middle	77	84	86	88	99	102	106	101	104	107	117	121	125
	High	99	105	108	111	128	132	136	129	134	138	152	158	164
40	Low	53	52	52	52	55	56	56	56	56	56	59	60	60
	Middle	75	74	75	76	82	84	85	83	84	86	92	94	95
	High	93	90	91	92	104	106	108	105	107	109	120	122	125
* Husband died aged 60 when widow was 55.
† 'rrr' is the real rate of investment return.

Table P5C Widows retiring in 2008 Onwards* Pension projections (£ per week at November 1985 prices)
			Personal Pensions	Occupational money purchase pension schemes
Age in 1988	Earner	Modified SERPS	Rebate only	Rebate + 2 per cent.	Rebate + 2 per cent.	Rebate + 4 per cent.
			†rrr=3 per cent.	rrr=3.5 per cent.	rrr=4 per cent.	rrr=3 per cent.	rrr=3.5 per cent.	rrr=4 per cent.	rrr=3 per cent.	rrr=3.5 per cent.	rrr=4 per cent.	rrr=3 per cent.	rrr=3.5 per cent.	rrr=4 per cent.
20	Low	62	74	78	82	90	96	102	91	97	104	108	115	124
	Middle	86	111	118	127	145	157	169	148	160	173	184	199	216
	High	115	147	158	171	199	215	234	203	220	239	257	279	304
30	Low	60	64	66	68	74	76	79	75	77	79	84	87	91
	Middle	83	94	98	102	117	122	128	118	124	130	141	149	157
	High	108	120	125	131	154	161	169	156	164	172	190	200	211
40	Low	56	56	57	57	61	62	63	62	63	64	67	69	70
	Middle	80	80	82	83	93	95	97	94	96	99	107	110	113
	High	102	102	104	107	123	126	130	124	128	132	146	150	155

Table P6C Widows Retiring in 2008 Onwards* Pension projections (£ per week at November 1985 prices)
			Personal Pensions	Occupational money purchase pension schemes
Age in 1988	Earner	Modified SERPS	Rebate only	Rebate + 2 per cent.	Rebate + 2 per cent.	Rebate + 4 per cent.
			†rrr=3 per cent.	rrr=3.5 per cent.	rrr=4 per cent.	rrr=3 per cent.	rrr=3.5 per cent.	rrr=4 per cent.	rrr=3 per cent.	rrr=3.5 per cent.	rrr=4 per cent.	rrr=3 per cent.	rrr=3.5 per cent.	rrr=4 per cent.
20	Low	60	72	75	79	86	91	97	87	92	98	102	108	116
	Middle	85	109	116	123	140	150	161	142	153	164	174	188	203
	High	113	146	156	168	193	207	224	196	211	229	244	264	287
30	Low	56	61	62	63	68	70	72	69	71	73	77	80	82

			Personal Pensions	Occupational money purchase pension schemes
Age in 1988	Earner	Modified SERPS	Rebate only	Rebate + 2 per cent.	Rebate + 2 per cent.	Rebate + 4 per cent.
			†rrr=3 per cent.	rrr=3.5 per cent.	rrr=4 per cent.	rrr=3 per cent.	rrr=3.5 per cent.	rrr=4 per cent.	rrr=3 per cent.	rrr=3.5 per cent.	rrr=4 per cent.	rrr=3 per cent.	rrr=3.5 per cent.	rrr=4 per cent.
	Middle	78	90	93	97	110	115	120	111	116	122	132	139	146
	High	101	112	116	121	142	148	154	144	150	157	174	183	192
40	Low	53	52	53	53	57	57	58	57	58	58	62	62	63
	Middle	74	75	76	78	86	88	90	87	89	91	99	101	104
	High	93	93	95	97	112	115	118	113	116	120	133	137	141
* Husband died aged 64 when widow was 59.
† 'rrr' is the real rate of investment return.