§ Dr. CableTo ask the Secretary of State for Work and Pensions if he will estimate the cost in each of the next 10 financial years from 2006–07, net of savings in means-tested benefits and additional income tax revenues, of paying from April 2006,(a) regardless of contribution record, (b) on the current basis, a basic state pension to (i) all single people aged 80 or above at the rate of the guarantee credit for single people and (ii) all couples where one or both partners is aged 80 or above at the rate of the guarantee credit for couples, with that pension being indexed to earnings in subsequent years, and assuming that the savings credit is abolished for those aged 80 or above. [174110]
§ 6. Malcolm WicksThe information is not available in the format requested. However such information as is available is in the table.
£ billion (a) Net cost (before Tax)
regardless of
contribution record
(b) Net cost (before Tax)
on current system
of entitlement
2006–07 1.6 1.5 2007–08 1.7 1.7 2008–09 1.9 1.8 2009–10 2.0 2.0 2010–11 2.2 2.1 2011–12 2.4 2.3 2012–13 2.5 2.5 2013–14 2.7 2.6 2014–15 2.9 2.8 2015–16 3.1 3.0 Notes:
1. The net cost includes all savings except for additional Income tax revenue, (see note (5). Figures are for Great Britain in 2004–05 price terms, using the GDP deflator index, rounded to the nearest £100 million.
2. Basic State Pension (BSP) costs are estimated by the Government Actuary's Department, consistent with Budget 2004 assumptions, made using 2002 based population projections.
3. The savings credit is abolished for those aged 80 and over from April 2006 with no payments to existing pensioners and no new recipients after 2006.
4. The savings from savings credit and other income related benefits (guarantee credit, housing benefit and council tax benefit) are calculated using the Department's policy simulation model for 2006–7. It is assumed that the proportion of savings calculated for the first year is constant for subsequent years.
(a) The net cost including tax revenues regardless of contribution record in 2006–07 is £1.3 billion. For illustrative purposes, we have assumed income tax revenue to be a fixed percentage of the gross cost for this option in 2007–08 and 2008–09. Therefore, the illustrative total net cost in 2007–08 is £1.5 billion and in 2008–09 is £1.6 billion. Estimates for later years would be subject to a greater degree of uncertainty.
(b) The net cost including tax revenues on the current system of entitlement in 2006–07 is £1.2 billion. Again we have assumed income tax revenue to be a fixed percentage of the gross cost for this option in 2007–08 and 2008–09. Therefore, the illustrative total net cost in 2007–08 is £1.4 billion and in 2008–09 is £1.5 billion.
1309W(c) Tax revenues have been calculated using the Department's policy simulation model, as this provides information at a household level.
(a) All single over 80 year olds have been given the single rate of the guarantee credit and all couples have been given the couples rate of the guarantee credit, split equally between the two, regardless of contribution records.
(b) Category A pensions are increased under existing rules (i.e. relative to the single rate of the guarantee credit) except that in a couple where one person is in receipt of a category B pension, the combined category A and category B pension is increased pro rata relative to the couples rate of the guarantee credit.
(c) In both scenarios couples with only one person over 80 years old are treated identically to those where both are over 80.
7. The State Second Pension is assumed to be unchanged.
§ Mr. WebbTo ask the Secretary of State for Work and Pensions if he will estimate the cost in each of the 10 financial years from 2006–07, net of savings in means-tested benefits and additional income tax revenues, of paying from April 2006 a basic state pension to all single people aged 70 or above at the rate of the guarantee credit of single people regardless of contribution record and a basic state pension to all couples where one or both partners is aged 70 or above at the rate of the guarantee credit for couples, with that pension being indexed to earnings in subsequent years, and assuming that the savings credit is abolished for those aged 70 or above. [175189]
§ Malcolm Wicks[holding answer 21 May 2004]: The information is not available in the format requested. However such information as is available is in the table.
Net cost (before tax) regardless of contribution record
2006–07 6.3 2007–08 5.8 2008–09 6.3 2009–10 6.7 2010–11 7.2 2011–12 7.7 2012–13 8.3 2013–14 9.0 2014–15 9.7 2015–16 10.4 Notes:
1. The net cost includes all savings except for additional Income tax revenue, (see note 5). Figures are for Great Britain in 2004–05 price terms, using the GDP deflator index, rounded to the nearest £100 million.
2. Basic state pension costs are estimated by the Government Actuary's Department, consistent with Budget 2004 assumptions, made using 2002 based population projections.
3. The savings credit is abolished for those aged 70 and over from April 2006 with no payments to existing pensioners and no new recipients after 2006.
4. The savings from savings credit and other income related benefits (guarantee credit, housing benefit and council tax benefit) are calculated using the Department's policy simulation model for 2006–07. It is assumed that the proportion of savings calculated for the first year is constant for subsequent years.
5. The net cost including tax revenues regardless of contribution record in 2006–07 is £4.6 billion. For illustrative purposes, we have assumed income tax revenue to be a fixed percentage of the gross cost for this option in 2007–08 and 2008–09. Therefore, the illustrative total net cost in 2007–08 is £5.0 billion and in 2008–09 is £5.4 billion. Estimates for later years would be subject to a greater degree of uncertainty. Tax revenues have been calculated using the Department's policy simulation model, as this provides information at a household level.
6. The state second pension is assumed to be unchanged.
1310W
§ Mr. WebbTo ask the Secretary of State for Work and Pensions pursuant to his answer of 4 May 2004,Official Report, column 1461W, on pensions, if he will estimate for each year the gross cost of the reform before taking account of offsetting savings in lower benefit expenditure and higher tax revenues. [175191]
§ Malcolm Wicks[holding answer 21 May 2004]: The information is provided in the table.
£billion 2006–07 5.7 2007–08 6.2 2008–09 6.7 2009–10 7.2 2010–11 7.8 2011–12 8.4 2012–13 9.0 2013–14 9.7 2014–15 10.4 2015–16 11.1 Notes:
1. Figures are for Great Britain in 2004–05 price terms, using the GDP deflator index, rounded to the nearest £100 million.
2. Gross basic state pension costs are estimated by the Government Actuary's Department and are consistent with Budget 2004 assumptions and use 2002 based population projections. Basic state pension costs refer to the additional costs after allowing for consequential changes to National Insurance Fund benefits and non-means tested vote benefits.
3. The state second pension is assumed to be unchanged.
§ Mr. WebbTo ask the Secretary of State for Work and Pensions if he will estimate the cost in each of the next 10 financial years from 2006–07, net of savings in means-tested benefits and additional income tax revenues, of paying from April 2006 a basic state pension to all single people aged 75 or above at the rate of the guarantee credit for single people regardless of contribution record, and a basic state pension to all couples where one or both partners is aged 75 or above at the rate of the guarantee credit for couples, with that pension being indexed to earnings in subsequent years, and assuming that the savings credit is abolished for those aged 75 or above. [170649]
§ Malcolm Wicks[pursuant to the reply, 4 May 2004, Official Report, c. 1461–62W]: The information is not available in the format requested. However such information as is available is in the table.
1311W
£billion Net cost (before tax) 2006–07 3.1 2007–08 3.4 2008–09 3.7 2009–10 4.0 2010–11 4.3 2011–12 4.7 2012–13 5.0 2013–14 5.4 2014–15 5.8 2015–16 6.2 Notes: 1. The net cost includes all savings except for additional income tax revenue, (see note 5) Figures are for Great Britain in 2004–05 price terms, using the GDP deflator index, rounded to the nearest £100 million. 2. Basic state pension costs are estimated by the Government Actuary's Department, consistent with Budget 2004 assumptions, made using 2002 based population projections.
3. The savings credit is abolished for those aged 75 and over from April 2006 with no payments to existing pensioners and no new recipients after 2006.
4. The savings from savings credit and other income related benefits (guarantee credit, housing benefit and council tax benefit) are calculated using the Department's policy simulation model for 2006–07. It is assumed that the proportion of savings calculated for the first year is constant for subsequent years.
5. The net cost including tax revenues regardless of contribution record in 2006–07 is £2.7 billion. For illustrative purposes, we have assumed income tax revenue to be a fixed percentage of the gross cost for this option in 2007–08 and 2008–09. Therefore, the illustrative total net cost in 2007–08 is £3.0 billion and in 2008–09 is £3.2 billion. Estimates for later years would be subject to a greater degree of uncertainty. Tax revenues have been calculated using the Departments policy simulation model, as this provides information at a household level.
6. The state second pension is assumed to be unchanged.