Social Security Benefits Up-rating Order 2006

Benefit uprating orders come at predictable and regular intervals. On the whole they say things which can be worked out once the September inflation rate is known. Last year it was 2.7 per cent and this uprating applies across the board with the exception of those benefits which are uprated in line with the Rossi index. Benefit uprating orders have an immediate effect on millions of people. Most of them are on comparatively low incomes. Two-thirds or so of these benefits go to pensioners, whose incomes will vary depending on their pay in work and the amounts they have contributed through national insurance contributions. Since this Government came to power, the relationship between the payment of national insurance contributions and the state pension has become watered down by the introduction of pension credit, which is means-capped and different in that it is uprated by the percentage rise in average earnings. All other benefits are uprated by the rate of inflation or the Rossi index. However, it is more interesting to see from year to year what is not uprated rather than what is. Yet again the pensioner’s age allowance, payable to people over 80, remains at a miserable 25p. I would be grateful to the Minister if he would answer two questions on that. First—to which I ought to know the answer—when was it introduced? Secondly, what is its value today compared with when it was introduced? In other words, what is the 25p actually worth today compared with when it was first granted? Also, what would it be worth today had it been uprated annually? Lastly, does this payment to an over-80 year-old reduce the amount of pension credit that may otherwise be payable? Another non-increase is that for child allowances under Part IV of the Social Security Contributions and Benefits Act 1992. On my reading of that Act, that includes the child allowances payable to widows. It is an unfortunate fact of life that not only will some widows be of working age and have children, but some will be quite young. Given that child credits for council tax benefit, for example, are being uprated, why are not those for the children of young widows? As a newcomer to this subject, I would be grateful if I could seek the assistance of the Minister. The uprating Statement appears to say something different from the order. As far as I can see, the order says that the only freezing that is occurring is in those cases where the dependant still qualifies for the tapered earnings rule. Have there been second thoughts here? The same questions apply to Article 3(2)(c), especially for death benefit allowance in respect of children and qualifying young persons. Having asked these questions, we on the Conservative Benches can find no fault with the generality of the order or, indeed, with the Guaranteed Minimum Pensions Increase Order 2006.