HC Deb 09 January 1996 vol 269 cc163-6W
Mr. Chris Smith

To ask the Secretary of State for Social Security what estimate he has made of the proportions of men and women who will retire with a full entitlement to a basic retirement pension in(a) 2025 and (b) 2035. [6528]

Mr. Andrew Mitchell

The information is not available in the format requested. By 2025, the large majority of men and approximately two thirds of women will have entitlements to a full basic pension.

Mr. Eric Clarke

To ask the Secretary of State for Social Security if he will estimate the cost in 1996–97 of paying a basic pension supplement to all pensioner units whose total pension income from all sources is less than the level of income support plus £5 for a single pensioner and £8 for a couple, raising their pension incomes to the income support level plus £5 for single pensioners and £8 for pensioner couples; and what would be the annual cost of maintaining pensioners' pension incomes at that level in real terms for each year until 2001–02, assuming the 1996–97 income support regime and giving costs net of any effects on tax/benefit revenues. [6703]

Mr. Mitchell

The estimated cost in 1996–97 of raising the total pension income from all sources of all pensioner units to income support levels plus £5 for a single pensioner and £8 for a pensioner couple is £3.05 billion. It is not possible to give estimates of this cost to the year 2001–02 as reliable forecasts of future levels of pensioners' incomes are not available for this period.

Notes: 1. It has been assumed that the pensioner supplement would be paid as an increase in income support levels. Maintaining the current income-related benefit system involves aligning the thresholds and income for assessment purposes in the other income-related benefits. As a result, there are increased costs in the housing benefit and council tax benefit included in the total. 2. To raise pension-only income to the levels specified implies that other income would be disregarded. The costs reflect this assumption also. 3. No account has been taken of any additional costs that would arise from the abolition of the existing capital limits in the income-related benefits which would be necessary to ensure that those above these limits also received any required increase in pension income. 4. Income support is not taxable for claimants over 60 years of age so there are no net tax effects from the increased payment in income support. 5. The costs have been estimated using data drawn from the May 1994 income support quarterly statistical inquiry and the 1991, 1992 and 1993 family expenditure surveys, uprated to 1996–97 prices and benefit levels and rounded to £50 million.

Mr. Martlew

To ask the Secretary of State for Social Security if he will estimate the cost in 1996–97 of paying a basic pension supplement to all pensioner units whose total pension income from all sources is less than(a) £69.20 and (b) £73.80 for a single pensioner and (i) £107.10 and (ii) £112.25 for pensioner couples, raising their pension incomes to those levels; and what would be the annual cost of maintaining pensioners' pension incomes at those levels in real terms for each year until 2001–02, assuming the 1996–97 income support regime and giving costs net of any effects on tax/benefit revenues. [6707]

Mr. Mitchell

The available information is in the table.

It is not possible to give estimates of this cost to the year 2001–02 as reliable forecasts of future levels of pensioners' incomes are not available for this period.

Estimated costs of raising pensioner incomes to specified minimums
Estimate Cost in 1996–97
Specified pensioner income level £ billion
(a) Single pensioners at minimum of £69.20 0.8
(b) Single pensioners at minimum of £73.80 1.3
(i) Couple pensioners at minimum of £107.10 1.1
(ii) Couple pensioners at minimum of £112.25 1.5

1. It has been assumed that the pensioner supplement would be paid as an increase in income support levels. Maintaining the current income-related benefit system involves aligning the thresholds and income for assessment purposes in the other income-related benefits. As a result, there are increased costs in the housing benefit and council tax benefit included in the total.

2. To raise pension-only income to the levels specified implies that other income would be disregarded. The costs reflect this assumption also.

3. No account has been taken of any additional costs that would arise from the abolition of the existing capital limits in the income-related benefits which would be necessary to ensure that those above these limits also received any required increase in pension income.

4. As income support is not taxable for claimants over 60 years of age, there will be no net tax effects from the increased payments in income support.

5. The costs have been estimated using data drawn from the May 1994 income support quarterly statistical Inquiry and the 1991, 1992 and 1993 family expenditure surveys, uprated to 1996–97 prices and benefit levels and rounded to £50 million.

Mr. Hutton

To ask the Secretary of State for Social Security if he will estimate the cost in 1996–97 of paying a basic pension supplement to all pensioner units whose total pension income from all sources is less than £67.05 for a single pensioner or £104.10 for pensioner couples, raising their pension incomes to those levels; and what would be the annual cost of maintaining pensioners' pension incomes at those levels in real terms for each year until 2001–02, assuming the 1996–97 income support regime and giving costs net of any effects on tax/benefits revenues. [6708]

Mr. Mitchell

The estimated cost in 1996–97 of raising the total pension income from all sources of all pensioner units to £67.05 for a single pensioner or £104.10 for pensioner couples is £1.9 billion. It is not possible to give estimates of this cost to the year 2001–02 as reliable forecasts of future levels of pensioners' incomes are not available for this period.

Notes: 1. It has been assumed that the pensioner supplement would be paid as an increase in income support levels. Maintaining the current income-related benefit system involves aligning the thresholds and income for assessment purposes in the other income-related benefits. As a result, there are increased cost in the housing benefit and council tax benefit included in the total. 2. To raise pension only income to the levels specified implies that other income would be disregarded. The costs reflect this assumption also. 3. No account has been taken of any additional costs that would arise from the abolition of the existing capital limits in the income-related benefits which would be necessary to ensure that those above these limits also received any required increase in pension income. 4. As income support is not taxable for claimants over 60 years of age, there will be no net tax effects from the increased payments in income support. 5. The costs have been estimated using data drawn from the May 1994 income support quarterly statistical inquiry and the 1991,1992 and 1993 family expenditure surveys, uprated to 1996–97 prices and benefits levels and rounded to £50 million.

Mr. Clarke

To ask the Secretary of State for Social Security if he will estimate the cost in 1996–97 of raising the incomes of all pensioner units to at least the level of income support plus £5 for a single pensioner and £8 for pensioner couples; and what would be the annual cost of maintaining pensioners incomes at that level in real terms for each year until 2001–02, assuming payments were made through the income support system and assuming the most recent levels of non-take-ups. [6702]

Mr. Mitchell

The estimated cost in 1996–97 of raising the incomes of all pensioner units to at least the level of income support plus £5 for a single pensioner and £8 for pensioner couples is £800 million assuming the most recent levels of non-take-up. It is not possible to give estimates of this cost to the year 2001–02 as reliable forecasts of future levels of pensioners' incomes are not available for this period.

Notes: 1. It has been assumed that the pensioner supplement would be paid as an increase in income support levels. Maintaining the current income-related benefit system involves aligning the thresholds and income brought to account in the other income-related benefits. As a result, there are increased costs in the housing benefit and council tax benefit included in the total. 2. It has been assumed that the income of pensioners is the current income for assessment purposes in income support. 3. No account has been taken of any additional costs that would arise from the abolition of the existing capital limits in the income-related benefits which would be necessary to ensure that those above these limits also received any required increase in pension income. 4. The costs have been; estimated using data drawn from the May 1994 income support quarterly statistical inquiry and the 1991,1992 and 1993 family expenditure surveys, uprated to 1996–97 prices and benefits levels and rounded to £50 million.

Mr. Benton

To ask the Secretary of State for Social Security if he will estimate the cost in 1996–97 of raising the incomes of all pensioner units to at least the level of income support; and what would be the annual cost of maintaining pensioners' incomes at that level in real terms for each year until 2001–02, assuming the 1996–97 income support regime and the most recent levels of non-take-up. [6705]

Mr. Mitchell

Those pensioner units whose incomes are below income support levels are raised to that level if they take up income support. All other pensioner units are either ineligible for income support, by virtue of their incomes, or choose not to take it up. As a result, there are no costs in any year of raising the incomes of all pensioner units to at least income support levels assuming the most recent levels of non-take-up.

Notes: 1. It has been assumed that the income of pensioners is the current income for assessment purposes in income support.

Mr. Callaghan

To ask the Secretary of State for Social Security what plans he has to increase the basic rate of retirement pensions. [8083]

Mr. Mitchell

My right hon. Friend the Secretary of State has announced his intention to increase the state pension by 3.9 per cent. in April 1996.