asked the Chancellor of the Exchequer what is the estimated cost at the present time and five and 10 years hence, of granting pensions of 30s. per week to all persons at 60 years of age, without applying any test of need; and what addition per £1 on Income Tax would be required to meet the cost such a change would represent, as compared with the present cost of old age and supplementary pensions?
The additional cost to the taxpayer of paying pensions of 30s. a week on a non-contributory basis to all persons aged 60 and over in Great Britain, with no test of need, is estimated at about £380,000,000 a year, after allowing for savings in the cost of other services or about £410,000,000 if contributions under the existing scheme were discontinued. These figures would rise by about £30,000,000 in five years and by about £60,000,000 in 10 years. On the basis that 1s. in the £ on the standard rate of Income Tax is equivalent to £100,000,000, the additional cost would be, arithmetically, equivalent initially to about 4s. on the standard rate of tax, rising in 10 years to about 4s. 8d. on the assumption, for the present purpose, that the yield of taxation remained unaltered.