Unemployment Benefit

Mr. Meacher
To ask the Secretary of State for Social Security what was the expenditure on earnings-related unemployment benefit each year since 1975, at current and at 1990 prices; and what is the estimated saving in public expenditure from the abolition of earnings-related unemployment benefit each year since 1982 and cumulatively, at current and at 1990 prices.

Mrs. Gillian Shephard
Expenditure on earnings-related unemployment benefit from 1975 to 1982 is shown in the table.--
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Information on the expenditure saving from the abolition of earnings-related unemployment benefit each year since 1982 is not available. In 1982 it was estimated that the public expenditure saving in the first full year from the abolition of earnings-related unemployment benefit was around £100 million at 1982–83 prices; this converts to about £150 million at 1990–91 prices. Following recent research into the work history of the newly unemployed, it is now estimated that if earnings-related unemployment benefit were to be reintroduced the gross cost would be around £200 million in the current financial year. There would be an offsetting saving of about £50 million on income support.