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Pensioner Benefits

Volume 448: debated on Wednesday 28 June 2006

To ask the Secretary of State for Work and Pensions what his latest estimate is of the (a) number and (b) proportion of pensioners entitled to (i) means tested benefits and (ii) pension credit in (A) 2010, (B) 2020, (C) 2030, (D) 2040 and (E) 2050 based on the proposals set out in the Pension White Paper Cm 6841; and if he will make a statement. (75512)

[holding answer 8 June 2006]: The information is not available in the format requested. The information available is shown in the following table.

The numbers eligible for pension credit in the future are subject to a range of uncertainties and a number of factors including policies on uprating different benefits. Table 1 shows the projected number and proportion of pensioner households eligible for pension credit under the proposals contained in the White Paper “Security in retirement: towards a new pensions system.”

Table 1: Projected number and proportion of pensioner households eligible to pension credit for selected years under the White Paper proposals

Number of pensioner households eligible (£ million)

Proportion of pensioner households eligible (percentage)

2010

4.15

44

2020

3.45

41

2030

2.95

31

2040

2.80

27

2050

2.95

29

Notes:

1. Long-run projections of the number and proportion of pensioners eligible for means tested benefits under the White Paper proposals are not available. 2. Projections of the number and proportion of pensioners eligible for pension credit are sensitive to modelling assumptions and to projected changes in the distribution of pensioner incomes.

3. The estimates of proportions shown here are the mid-points of projections taken from two separate micro-simulation models. Modelling of the reform proposals does not include any increase in private saving from the introduction of personal accounts, which would further reduce the numbers eligible for pension credit.

4. Projections of the number of pensioners eligible for pension credit are derived from the projected proportions eligible and projections of the number of pensioner households in Great Britain.

5. These projections assume: continued earnings uprating of the standard guarantee credit; earnings uprating of the savings credit threshold from 2008 to 2014; earnings uprating of the basic state pension from 2012; price uprating of the maximum savings credit from 2015; measures to improve coverage of the basic state pension described in the White Paper.

6. Estimates cover all those aged above women's state pension age in the private household population of Great Britain.

7. Estimates account for equalisation of state pension age between 2010 and 2020. They also account for the proposed further increases in state pension age described in the White Paper. The estimates assume that the minimum age at which people can claim pension credit rises in line with women's state pension age.

8. Estimates are calibrated to the mid-points of the 2004-05 National Statistics range estimates of non-eligibility to pension credit, which adjust 2004-05 family resources survey data to take account of possible biases in reporting. Although the estimates here are not presented as ranges, they are subject to a margin of uncertainty.

9. Estimates of the number of pensioner households eligible are rounded to the nearest 50,000.