§ Mr. MeacherTo ask the Secretary of State for Social Security if he will list all the changes made to the national insurance retirement pension since 1979, noting the date of implementation, the numbers affected and the full-year savings or cost, gross and net of savings or cost in other benefits.
§ Miss WiddecombeThe major changes and the effect of those changes made to the national insurance retirement pension since 1979 are as follows:
1. November 1980—pensions uprating
Alteration of statutory up-rating requirement to increase by prices, rather than whichever was the higher of prices or earnings. Affected all in receipt of retirement pension. Gross savings £65 million (1980–81).
2. December 1984—married women's half-test
Abolition of married women's half-test for those women who reached age 60 before 6 April 1979. Affected 25,000 women. Gross cost £30 million—net £25 million (1985–86).
3. December 1984—hospital in-patients
Husbands of married women in hospital treated as dependants for hospital downrating purposes in all cases. Implemented retrospectively April 1989. Actual numbers affected and costs not known.
4. April 1988—time limits
Time limits for claiming Retirement Pension extended from 3 to 12 months. Delayed claims can be backdated up to a 12 month absolute limit. Affected 27,000 potential cases. Gross cost estimated to be £2.5 million 368W in first year (1988–89).
5. October 1989—earnings rule
Abolition of retirement pensions earnings rule for men between age 65–69 and women between age 60–64. Resulted in 115,000 new claims and increased the rate of pension for a further 2,500 pensioners whose pension was reduced on account of the earnings rule. Gross cost £300 million (1990–91).
Notes:
1) Estimates of the net cost and savings on other benefits are not available, except for item 2.
2) Records of ongoing costs are not retained for most benefits due to the expense of collating the information. The amounts quoted therefore apply to the information available at the time the change was implemented.
§ Mr. MeacherTo ask the Secretary of State for Social Security what would be(a) the first year and (b) the full year cost of raising the retirement pension by £5 per week for a single person and by £8 per week for a married person (i) in 1991–92 and (ii) 1992–93, including increases in means-tested and national insurance benefits for Great Britain.
§ Miss WiddecombeThe gross cost would be £3.0 billion in 1991–92 and provisional estimates suggest that the gross cost will be the same in 1992–93.
§ Mr. Tom ClarkeTo ask the Secretary of State for Social Security (1) what is the statutory instrument which links benefits to the category A basic retirement pension; and what would be(a) the first year and (b) the full year cost, net of tax, of raising by £5 per week for a single person and by £8 per week for a married person the retirement pension and (i) each linked benefit, (ii) each linked and means-tested benefit so that all of the people on linked benefits receive the increase, (iii) each of the linked benefits at the same level as the retirement pension, (iv) each of the linked benefits at the same level as the retirement pension and means-tested benefits so that all of the people on these linked benefits receive the increase, (1) for 1991–92 and (2) 1992–93, in each case including and excluding those below retirement age;
(2) What would be the numbers of people affected above and below retirement age by raising by £5 per week for a single person and by £8 per week for a married person, the retirement pension and (a) each benefit linked by statute to the Category A Basic Retirement Pension, (b) each linked and means-tested benefit so that all of the people on linked benefits receive the increase, (c) each of the linked benefits at the same level as the retirement pension and (d) each of the linked benefits at the same level as the retirement pension and means-tested benefits so that all of the people on these linked benefits receive the increase, for Great Britain in 1991–92, listing separately the numbers on each benefits, including and excluding those below the retirement age.
§ Miss Widdecombe[holding answer 3 December 1991]: The following statutory provisions link the rate of other contributory benefits with the category A retirement pension: sections 14, 15, 25, 26 and 29 of the Social Security Act 1975 and sections 6, 7, 8, 13 and 14 of the Social Security Pensions Act 1975.
The full-year net benefit cost of raising the category A, B, C and D basic retirement pensions by £5 for a single person and £3 for a category BL pension would be £1.84 billion in 1991–92 and £1.64 billion net of income tax. Detailed estimates for 1992–93 are not yet available.
The full year costs of the other options in 1991–92 are as follows:
369W
Table 1—Those at or above state pension age £ billion Net benefit cost Net of tax cost RP IVB WB RP IVB WB (i) Each linked benefit 1.84 0.07 0.01 1.64 0.07 0.01 (ii) Each linked and income related benefit increased too 2.47 0.09 0.01 2.27 0.09 0.01 At this level of rounding the costs of options (iii) and (iv)—which cover only linked benefits paid at the same rate of category A retirement pension—are the same as (i) and (ii) respectively.
Table 2 Those below state pension age. £ billion Net benefit cost Net of tax cost IVB WB IS IVB WB IS (i) each linked benefit 0.25 0.05 0.00 0.25 0.04 0.00 (ii) each linked and income related benefit increased too 0.33 0.07 0.05 0.33 0.06 0.05 (iii) each linked benefit at same level as RP 0.25 0.03 0.00 0.25 0.02 0.00 (iv) linked benefits at same level income related benefits increased too 0.33 0.04 0.05 0.33 0.03 0.05 10 million people would be affected by raising the Category A, B, C and D Basic Retirements Pension by £5 for a single person and £3 for a Category BL Pension in 1991–92. 1.15 million benefit units would receive less Income Support as a result of this increase; 1.6 million benefit units would receive less housing benefit and 2.35 million benefit units would receive less Community Charge Benefit (some of these benefit units would receive less from both benefits). The numbers of people (benefit units for income related benefits) affected by the other options are as follows:
Table 3: Those at or above state pension age (millions) RP IVB WB IS HB CCB (a) Benefits linked to category A RP 10.00 0.25 0.05 1.15 1.65 2.40 (b) Linked benefit plus income related benefits increased too 10.00 0.25 0.05 — — — Note: In option (a) those on IS, HB and CCB see reductions in their income related benefits when they receive the increase in their contributory benefit; this does not happen in option (b) At this level of rounding options (c) and (d)—which cover only linked benefits paid at the same rate of Category A Retirement Pension—the numbers are the same as (a) and (b) respectively.
Table 4 those below state pension age (millions) IVB WB IS HB CCB (a) Benefits linked to category A RP 1.10 0.30 0.10 0.25 0.35 (b) Linked benefit plus income related benefits increased too 1.10 0.30 10.15 10.05 10.00 (c) Linked benefits at same level as category A RP 1.10 0.20 0.10 0.15 0.30 (d) Linked benefits at same level as category A RP plus income related benefits increased too 1.10 0.20 10.15 10.15 10.00 Notes:
In table (4) numbers shown on IS, HB or CCB as affected by the changes for options (a) and (c) are those who would not receive the full £5 or £8 per week due to reductions in income related benefits. Those cases marked with a ' are those men aged 60 to 64 who gain from the increase in the pensioner premium for income related benefit of £5 and £8 per week.
Unemployment benefit and sickness benefit paid to those over state pension age are linked statutorily to the basic category A retirement pension but the numbers of people in receipt of these benefits are comparatively very small and are not included in these estimates.
370W
- RP is all categories of retirement pension.
- IVB is invalidity benefit.
- WB is widows benefit.
- IS is income support.
- HB is housing benefit.
- CCB is community charge benefit.