§ Mr. Laurence RobertsonTo ask the Secretary of State for Social Security what plans he has to review the level of savings which requires his Department to assume an income of £1 for every £250 above that limit, when calculating benefits; and if he will make a statement. [80666]
§ Angela EagleThe assumption of notional (tariff) income of £1 for every £250 of capital above £3,000 reflects an expectation that people with more substantial savings can make some contribution towards their living expenses from those savings. This formula, which does not represent any assumed rate of interest, avoids the many practical difficulties that would arise if actual income were taken into account. However, we continue to review the benefit rules as part of our commitment to modernise the Social Security system.
In particular, we are determined to help the poorest pensioners and are concerned about those who miss out on the Minimum Income Guarantee because of modest savings. We have made it clear in the Pensions Green Paper (cm 4179) that we want to look at options for changing the rules on the treatment of voluntary saving to 279W better reward those who have saved for their retirement, and intend to bring forward proposals later in this Parliament.