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Pensions (Costs)

Volume 82: debated on Monday 8 July 1985

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asked the Secretary of State for Social Services if he will give an estimate of the costs of the basic retirement pension, supplementary pension, housing benefit, and state earnings-related pension scheme itemised separately (a) if the state earnings-related pension scheme is not phased out and (b) if the state earnings-related pension scheme is phased out according to the Green Paper proposals, for the following years: 1988–89, 1993–94, 2003–04, 2013–14, 2023–24 and 2033–34.

The estimated costs at 1984–85 prices, assuming prices upratings of the basic retirement pension and additional component, if the state earnings-related pension scheme (SERPS) were not to be phased out, are as follows:

Basic Retirement Pension £ billionAdditional Component £ billion
1988–8916·40·5
1993–9416·61·3
2003–0416·64·4
2013–1418·19·6
2023–2420·015·7
2033–3421·923·1
The only available projections of supplementary pension and housing benefit costs are the illustrative estimates given in tables 2.18 to 2.20 and paragraph 2.35 in volume 3 of the Green Paper.If SERPS is phased out in accordance with the Green Paper proposals, savings will not start to be made until after 2002. The cost of the scheme is expected to be reduced by about half by 2023–24, and by about three quarters by 2033–34. The estimated costs of basic

retirement pension would be unaffected. More precise figures will not be available until the proposals in the Green Paper have been finalised in the light of consultations.