§ Mr. FieldTo ask the Secretary of State for Social Security if he will estimate the pension savings which will be needed to purchase an annuity equivalent to the difference between the value of the minimum income guarantee and passported benefits, and the value of the basic pension, in 15 years' time, assuming that the basic pension is raised in line with prices, the minimum income guarantee is raised in line with earnings, and that yields on Government bonds remain the same as at present. [79785]
§ Mr. TimmsThe information is not available in the form requested. Such information as is available is as follows:
Projections of the levels of council tax, local authority and private sector rents in 15 years' time are not available. It is therefore not possible to estimate likely values of Council Tax Benefit and Housing Benefit so far into the future. However, these benefits are still available (at the differing rates) to people above the Minimum Income Guarantee. Free prescriptions are available to all pensioners, not just to those on Income Support.
In 15 years' time, in order to purchase an annuity to provide an income equivalent to the difference between the basic State pension and the Minimum Income Guarantee would require a lump sum of approximately £15,000 in 1999 earnings terms, or £19,000 in 1999 prices.
Notes:
- 1. Figures are rounded to the nearest £1,000.
- 2. Earnings grow 1.5 per cent. faster than prices.
- 3. Annuity rates remain at the March 1999 level and are for a single man aged 65.
- 4. Basic State pension rises in line with prices.
- 5. Minimum Income Guarantee rises in line with earnings.