Pensions (Hansard, 8 January 2003)

§ Mr. McCartney

The Government want all pensioners to have a decent and secure income in retirement and to share fairly in the rising prosperity of the country. The Government's first priority has been to help the poorest pensioners.

From April 2002, the Government are spending an extra £6 billion a year in real terms on pensioners as a result of policies introduced since 1997. This includes £21/2 billion more on the poorest third of pensioners. This is three times more than a link between the basic state pension and average earnings since 1998 would have given them.

We have introduced a range of initiatives designed to encourage pensioners to take up their entitlements. For the minimum income guarantee (MIG) we have undertaken a national advertising campaign, which resulted in almost 140,000 successful claims, with an average gain of £20 per week. We have also reduced the MIG claim form from 40 to 10 pages, introduced a MIG specific leaflet, and we are identifying potential beneficiaries through key events, such as claiming state pension.

A key priority, for both Government and the Pension Service is the successful take up of the new pension credit, which will enhance and replace the MIG. It has been specifically designed to be easy for pensioners to claim and to be less intrusive. The weekly means test will be abolished for the over 65s and be replaced by a statement of their circumstances every five years. Capital rules will be relaxed and the upper capital limit abolished.

Our take-up plan for pension credit is extensive and makes use of a range of channels. We will transfer existing MIG recipients to pension credit, ready for payments to be made from October 2003; write to all pensioners not already receiving MIG by June 2004 to alert them to possible pension credit entitlement, supported by a national publicity campaign; work with local partners to help support the communications to pensioners, and tailor marketing and communications activity accordingly.

The Government have introduced other initiatives to help pensioners. These include winter fuel payments (WFPs), which will continue to be paid to qualifying households at £200 a year throughout this Parliament. In addition, we have introduced free TV licences for the over 75s, worth £104 a year. The WFPs and TV licences are non income-related and are tax free.

All of the above demonstrate the importance that we attach to encouraging pensioners to take-up their entitlements, which in turn helps the poorest pensioners.