13. What assessment he has made of the potential effects on pensioners of the uprating of pensions using the consumer prices index. (49050)

The net effect of the triple guarantee for the basic state pension—the figure we gave a moment ago—and CPI for the additional pension is estimated to be a lifetime gain of around £10,000 for the average person reaching retirement in 2011. The impact on private sector occupational pension schemes will vary from scheme to scheme.

Can my hon. Friend confirm that the triple guarantee will ensure that pensioners will receive a decent offering from the state in their retirement?

My hon. Friend correctly points out that for the past 30 years the value of the state pension has been falling and falling relative to the living standards of the working population. We are proud to have put a halt to that.

Will pensioners be worse off or better off should income tax and national insurance be combined?

Obviously, this idea is at a very preparatory stage, but my right hon. Friend the Chancellor has made it clear that pensioners will not simply face an increase in overall tax as would be the case if the two tax rates were simply added together. The idea is in its very early stages, a lot of preparatory and consultative work is going on, and I am sure that the Chancellor is entirely mindful of the points that the hon. Lady raises.