HC Deb 15 April 2002 vol 383 cc699-700W
34. Dr. Palmer

To ask the Secretary of State for Work and Pensions what steps he plans to take to increase public awareness of the state second pension; and if he will make a statement. [45048]

Mr. McCartney

The state second pension reformed the state earnings-related pension scheme (SERPS) on 6 April 2002. It will boost the additional state pension entitlement of 14 million low and moderate earners. Additionally, for the first time two million carers and two million people whose working lives are disrupted by long-term illness or disability will also benefit as a result of the reforms in that they will be able to build up entitlement to the state second pension.

Most people will benefit automatically from the state second pension without having to do anything new or different. Our publicity activity therefore focuses on the group who may not automatically start building up state second pension and may need to take appropriate action. We aim to encourage carers to check their circumstances now, We have produced a new leaflet and started a programme of activity to inform relevant groups, which includes press advertising. In addition, we included a message in the child benefit uprating letter, are revising existing leaflets, and we are sending copies of the new leaflet to advisers.

Paul Flynn

To ask the Secretary of State for Work and Pensions what the additional cost of the basic state pension would be in(a) 2010, (b) 2020, (c) 2030, (d) 2040 and (e) 2050 if the inflation rate were (i) 2 per cent. and (ii) 1.5 per cent. in one year out of every two, and (A) 2.5 per cent. or more in the other years and (B) 2.5 per cent. each year. [41195]

Malcolm Wicks

Additional cost to basic state pension if in one year out of every two the inflation rate were:

  1. (i) 2 per cent.
  2. (ii) 1.5 per cent.

£ billion
2 per cent. inflation 1.5 per cent. inflation
2010 0.4 0.8
2020 1.5 3.05
2030 3.2 6.55
2040 5 10.5
2050 6.55 13.85

Note:

1. Figures are gross cost for GB rounded to the nearest £50 million.

The basic state pension is to be uprated by the greater of 2.5 per cent. or RPI, and so (A) and (B) would not affect expenditure in real terms.

Mr. Flight

To ask the Secretary of State for Work and Pensions how many people he expects to contract back into SERPS/the state second pension over the next 10 years from(a) personal pension schemes and (b) final salary occupational pension schemes. [44684]

Maria Eagle

No such estimate has been made. The decision to contract out of SERPS/state second pension is a matter of personal choice.

Mr. Pike

To ask the Secretary of State for Work and Pensions what plans he has for the future of the basic state pension. [45910]

Mr. McCartney

The Government believe that the basic retirement pension should remain the essential foundation of income in retirement.

We increased rates last April by £5 a week for single people and £8 a week for couples and from April 2002 there will be further increases of £3 a week for single people and £4.80 for couples. In future, the state pension will rise by at least 2.5 per cent, or the September rate of RPI, whichever is the higher.