HC Deb 01 July 2002 vol 388 cc94-5W
Paul Flynn

To ask the Secretary of State for Work and Pensions what would be the value of the basic pension for(a) a single pensioner and (b) married couple (i) if the link to average earnings or prices had not been repealed and (ii) if the pension had been increased in line with average earnings since then. [61151]

Mr. McCartney

The information requested is set out in the table. Our priority is to ensure that all pensioners have a decent and secure income in retirement and to share fairly in the rising prosperity of the country. The basic state pension will remain the foundation of income in retirement. To achieve this, we have increased the basic state pension over the last two years above the level of RPI and we have provided extra help for pensioners through the minimum income guarantee, winter fuel payments and free TV licences for the over-75s. We have given a guarantee that the basic state pension will be increased by at least £100 a year for single pensioners and £160 for couples in 2003-04 and in future years by 2.5 per cent. or the increase in the September retail prices index, whichever is the higher.

Compared with the 1997 system, an average pensioner household will be £840 a year better off and around 1.8 million of the poorest pensioner households will be over £1,000 a year better off, and the Government will be spending an extra £6 billion a year in real terms on pensioners this year. This £6 billion includes £2.5 billion more on the poorest third of pensioners, which is three times more than an earnings link since 1998 would have given them.

£ per week
Single Couple
Basic state pension at November 1979 23.30 37.30
Actual amount in April 2002 75.50 120.70
Amount in April 2002 if up-rated by higher of RPI/earnings 105.70 169.00
Amount in April 2002 if up-rated with average earnings 102.60 164.20

Notes:

1. Rates are taken from November 1979 as the earnings link was broken in November 1980.

2. The retail prices index (all items) has been used as published by the Office for National Statistics.

3. Average Earnings Index Whole Economy (non-seasonally adjusted) has been used as published by the Office for National Statistics.

4. Figures have been rounded to the nearest five pence at each uprating.

Source:

Information Centre, Analytical Services Directorate