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Retirement Pensions

Volume 463: debated on Tuesday 22 March 1949

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3.

asked the Minister of National Insurance whether, in order to secure greater equality of treatment between insured persons reaching pensionable age before and after 5th July, 1948, he will give to the latter who postpone their retirement the option of drawing 10s. a week while still at work in lieu of the increment of 2s. a week for each year worked after retirement age.

The exercise of such an option would be a matter of great difficulty for individuals and might result in the forgoing of substantial benefits now available. It would in any case run counter to the principles underlying the scheme of retirement pensions so recently approved by Parliament.

Is my right hon. Friend aware of the strength of feeling on this matter among insured persons who reached pensionable age after the new scheme came into operation? If they continue at work not only do they lose the 10s., but they have to pay 4s. 11d. a week in addition. They are in a less favourable position.

There are those who regret very much the loss of the 10s. pension but there are 10s. pensioners who would like to come under the new scheme. It is too early yet to arrive at a decision about the effectiveness of the retirement provision.

Is my right hon. Friend aware that there are many who would like the choice to operate the other way round; that there are many people receiving the 10s. a week who would prefer to remain in insurance in order to qualify for sickness benefits and qualify for the extra pension at the end?

That is what I have just said. There are some who would rather have the 10s. and others who would prefer to be under the new scheme.

Will my right hon. Friend reconsider this point. I have drawn his attention to a case of two men who were working at the same bench. Before the Labour Government came into power, one of them received the 10s. pension, but the other did not receive it afterwards. Is not that a retrograde step?

Perhaps my hon. Friend will have a word with them in two or three years' time when one of them is getting the increased pension and the other is not.

Is the right hon. Gentleman aware that he is asking the House to believe that these people are not in a position to exercise their discretion in a matter of this kind? Why cannot he leave it to them to decide where, in their view, the balance of advantage lies?

The Act was passed by the House only recently. The question whether or not there should be an option was very fully discussed and it was decided—it was a recommendation of the Beveridge Report and was included in the White Paper of 1944 and in the Act —that the retirement pension should take the place of the old 10s. pension.

Will not my right hon. Friend agree that the proposal to make the pensions retirements pensions rather than old-age pensions was based on the desire to make them at the same time a contribution towards the relief of unemployment; and in view of the fact that labour conditions have wholly changed since then and that it is desirable now to keep people at work if they wish instead of encouraging them to retire, is there not now a case for reconsidering it?

The whole purpose of the new provision is to encourage older people who are able to do so to stay at work. Indeed, at the moment 64 per cent. of the men who reach 65 years of age do not retire. There is a very much larger proportion of old people at work today than at any time in the last 50 years.