Basic State Pension (Hansard, 19 June 2002)

§ Mr. Frank Field
To ask the Secretary of State for Work and Pensions what the cost would be of increasing the basic state pension(a) for the single pensioner to £120 per week for the over 75s and (b) for married couples to £150 a week for the over 75s in 2002–03. [61260]

§ Mr. McCartney
The information is not available in the format requested. However, such information as is available shows that the additional cost of increasing the maximum rate payable of a category A, AB or B basic state pension to £120 per week for those aged 75 and over would be £8.4 billion in 2002–03.
Note:
The cost is gross and is in cash terms, rounded to the nearest £100 million, based on September 2001 GB administrative data.

§ Mr. Willetts
To ask the Secretary of State for Work and Pensions, pursuant to his answer of 20 May 2002,Official Report, column 42W, why the practice of up-rating basic state pension increments in line with the percentage increase in the rest of the basic pension was not followed in April 2001; and why the practice was resumed in April 2002. [62608]

§ Mr. McCartney
Once retirement pension is in payment, social security legislation requires that the value of all the components of RP must be uprated each year by at least the level of price inflation, which was 3.3 per cent. for the April 2001 uprating. In accordance with that requirement, all increments, including basic pension increments were uprated by 3.3 per cent., while basic state pension was increased by substantially more than the rate of price inflation.
For the April 2002 uprating we decided that the more generous uprating should also apply to increments.

§ Paul Flynn
To ask the Secretary of State for Work and Pensions, pursuant to his answer of 10 June 2002,Official Report, column 880W, on the cost of the basic state pension if increased in line with prices, what assumptions he made regarding (a) fluctuations in the rate of inflation and (b) the incidence of inflation rates below 2.5 per cent. [62626]

§ Mr. McCartney
We assumed that fluctuations in the rate of inflation are consistent with predicted inflation from the Treasury Economic Assumptions (of January 2002) until the year 2008, after which we assume long-run inflation is constant each year at 2.5 per cent. Thus inflation rates after 2008 are assumed to never be below 2.5 per cent.
408W
In addition, the costs take account of our guarantee to increase the basic state pension by at least £100 a year for single pensioners and £160 for couples in the 2003–04 and in future years by 2.5 per cent. or the increase in the September retail prices index, whichever is the higher.

§ Mr. Frank Field
To ask the Secretary of State for Work and Pensions what the cost would be of increasing the basic state pension(a) for the single pensioner to £120 a week and (b) for married couples for £150 a week in 2002–03. [61263]

§ Mr. McCartney
The information is not available in the format requested. However, such information as is available shows that the additional cost of increasing the maximum rate payable of a category A, AB or B basic state pension to £120 per week would be £17.7 billion in 2002–03.
Note:
The cost is gross and is in cash terms, rounded to the nearest £100 million, based on September 2001 GB administrative data.