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Pensioners

Volume 470: debated on Thursday 17 January 2008

To ask the Secretary of State for Work and Pensions what the net cost would be of increasing the basic state pension for all pensioners to £119.05 a week in 2008-09. (172160)

The estimated net cost is approximately £21 billion in 2008-09 which takes savings from income-related benefits into account.

Notes:

1. ‘All pensioners’ is defined as all individuals over state pension age living in the United Kingdom. The estimate does not include pensioners claiming a UK pension, but living overseas. Including this group would increase the estimated costs.

2. Savings from income related benefits have been estimated using the Department's Policy Simulation Model.

3. The estimate is consistent with mid-2004 GAD population projections.

4. The estimate is in 2007-08 prices and has been rounded to the nearest £ billion.

To ask the Secretary of State for Work and Pensions what the net cost would be of increasing the basic state pension for all existing pensioners to 60 per cent. of median population income in 2008-09. (172161)

The estimated net cost is approximately £22 billion in 2008-09 which takes savings from income-related benefits into account.

Notes:

1. 60 per cent. of median population income for a single person with no children after deducting housing costs was £108 per week in 2005-06 (Households Below Average Income, DWP). This figure has been uprated by average earnings to £121.60 per week in 2008-09.

2. ‘All pensioners’ is defined as all individuals over state pension age living in the United Kingdom. The estimate does not include pensioners claiming a UK pension, but living overseas. Including this group would increase the estimated costs.

3. Savings from income related benefits have been estimated using the Department's Policy Simulation Model.

4. The estimate is consistent with mid-2004 GAD population projections.

5. The estimate is in 2007-08 prices and has been rounded to the nearest £ billion.