Skip to main content

Pensioners: Social Security Benefits

Volume 458: debated on Thursday 22 March 2007

To ask the Secretary of State for Work and Pensions what estimate he has made of the number of (a) individuals over the state pension age and (b) households with at least one member over the state pension age who would be eligible for an income-related benefit in (i) 2012, (ii) 2015, (iii) 2020, (iv) 2030, (v) 2040 and (vi) 2050 if the earnings link were restored to the basic state pension in (A) 2012 and (B) 2015. (122387)

The information requested is not available. Projections of entitlement for pension credit under the proposed reforms to state pensions are given in the following tables.

The Government have given a commitment to re-link the uprating of the basic state pension to average earnings. Our objective, subject to affordability and the fiscal position, is to do this in 2012, but in any event by the end of the next Parliament at the latest. We will make a statement on the precise date at the beginning of the next Parliament.

The proposed reforms to the state pension system will encourage individual personal responsibility for retirement and provide a solid foundation on which people can save. These reforms will mean that those with a good history of working or caring and saving towards retirement will be taken clear of entitlement to the pension credit standard minimum guarantee, while continuing to provide a safety net for those who have been unable to build up a sufficient state or private pension.

(a) Individuals over state pension age entitled to pension credit

Projections of pension credit entitlement

With earnings link restored from 2012

With earnings link restored from 2015

Individuals entitled (Million)

Percentage of total

Individuals entitled (Million)

Percentage of total

2012

5.1

44

5.1

45

2015

5.1

42

5.2

44

2020

4.7

38

4.9

40

2030

4.2

32

4.5

34

2040

3.8

27

4.0

29

2050

3.0

23

3.3

25

(b) Households with at least one member over state pension age entitled to pension credit

With earnings link restored from 2012

With earnings link restored from 2015

Households entitled (Million)

Percentage of total

Households entitled (Million)

Percentage of total

2012

4.5

45

4.5

46

2015

4.5

45

4.6

46

2020

4.1

41

4.3

43

2030

3.9

36

4.1

37

2040

3.7

32

3.9

33

2050

3.0

28

3.3

30

Notes:

1. Projections incorporate the reforms to state pensions included in the Pensions Bill and are consistent with projections included in the Regulatory Impact Assessment to the Bill.

2. The projections do not include the impact of personal accounts.

3. Robust projections of combined entitlement to pension credit, housing benefit and council tax benefit are not available.

4. Care should be taken when interpreting these projections as they are subject to a margin of uncertainty. The projections are based on long run simulations of the incomes of individuals under a set of assumptions including life expectancy, partnership formation, earnings growth, employment rates, state and private pension accumulation.

Source:

DWP projections