As from 1st October, 1951, the standard rate of contributory pension, that is, 26s. for a single person and 42s. for a married couple, will be increased to 30s. and 50s. respectively for men over 70 and women over 65. For men between 65 and 70 and women between 60 and 65, who postpone retirement, the increments to their pension which they gain thereby will be increased from 2s. to 3s. a week for each extra year they stay at work.
For men between 65 and 70 and women between 60 and 65 who retire, pensions will remain at the present figure up to 70 or 65 as the case may be, plus, of course, any increments they may earn for staying on for part of this period, but the amount per week which they are allowed to earn without reduction of the pension will be increased from 20s. to 40s. a week. There will also be certain increases in the benefits payable to widows with children and to persons on other benefits in respect of children.
Tomorrow evening the Minister of National Insurance will present a White Paper giving further details of these proposals, and in the next few days will introduce a Bill to give effect to them. Their cost will be £39 million in the first full year and £19 million in 1951–52. That is all that we can afford. I must make it plain that we are not able to raise any other social insurance benefits at the moment. We believe that the line we have drawn is a reasonable one, because, in the main, benefits are raised to those most completely and continuously dependent upon them.
I must add a few words about war pensions. The considerations which have led the Government to increase certain classes of old age pensions do not apply to the general run of war pensions. The great majority of war disablement pensioners are, in fact, at work and earning. We do not, therefore, intend to increase the basic rate of war pensions. However, it is intended to make some improvements amounting to over £600,000 a year in certain supplementary allowances. The details will be given to the House by the Minister of Pensions at an early date.
I also propose, as a corollary of the increase in the old age pension, to adjust the income limit of the Income Tax dependent relative allowance to ensure that the allowance continues to be given in full where the ordinary old age pension is the dependant's only source of income.