Contributory Pensions Act.

Oral Answers to Questions — Education. – in the House of Commons on 11th March 1926.

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Photo of Mr Charles Ammon Mr Charles Ammon , Camberwell North

60.

asked the Minister of Health whether instructions have been issued or Regulations framed to the effect that the means limit test for old age pensioners is to be imposed upon voluntary contributors under the Widows', Orphans' and Old Age Contributory Pensions Act?

Mr. CHAMBERLAIN:

The answer is in the negative.

Photo of Mr Robert Taylor Mr Robert Taylor , Lincoln

61.

asked the Minister of Health under which section of the Widows', Orphans' and Old Age Contributory Pensions Act the draft Regulations and the Circular of 27th February,1926, referring to the position of voluntary or employed contributors in excepted employments, were issued; and whether he is aware that the effect of such Regulations is to impose a means test on persons over 45 at the date of their last entry into full insurance in respect of their right to an old age pension at 65?

Mr. TREVELYAN THOMSON:

94.

asked the Minister of Health if he will state on what authority he has issued Regulations or memoranda to approved societies relating to excepted persons becoming voluntary contributors after 3rd January, 1926, which reduce the old age pension payable at 65 years in the case of a man and his wife for no other reason than that they are having compulsory deductions made from their wages for superannuation purposes; when are these Regulations to be laid before the House of Commons; and will an opportunity be afforded to discuss them before they become operative?

Photo of Sir Charles Edwards Sir Charles Edwards , Bedwellty

109.

asked the Chancellor of the Exchequer, with regard to the Regulations which he has issued, in conjunction with the National Health Insurance Joint Committee, in respect of voluntary contributors to the new pensions scheme, seeing that such Regulations will prevent those in excepted employments under the Crown, public authority employés, railway men, etc., who may come under superannuation schemes from receiving the same benefit from the scheme for old age pensions as compulsory contributors will obtain, and that the same contribution will have to be paid in each case, will he state why the voluntary contributors' benefits are less favourable?

Mr. CHAMBERLAIN:

I will, with permission, answer these questions together. The draft Regulations in question are issued in accordance with Section 15 (7) (b) of the Act, which provides that in the case of the persons specified therein the provisions of the Act relating to old age pensions payable there under, or by virtue thereof, shall apply in such circumstances only, and subject to such modifications as may be prescribed. The effect of that provision is that Regulations must be made before the persons referred to can be entitled to old age pensions under the Act. The reason underlying the provision was that the persons affected while engaged in excepted employment, pay a contribution for widows' and orphans' pensions only, and the Pensions Fund does not receive in respect of them the contributions ordinarily paid for old age pensions. It is obvious, therefore, that if old age pensions at the normal rate were to be provided for such of these persons as became fully insured—e.g., by becoming voluntary contributors—late in life, there would be a heavy loss to the fund. I would point out that these Regulations only affect pensions payable under or by virtue of the Contributory Pensions Act, and so far as any of the persons in question have a title to an unreduced old age pension under the 1908 to 1924 Acts, that title is unaffected. The draft Regulations will be made substantive shortly after Easter and will then, in accordance with the provisions of Section 30 (3) of the Act, be laid before the House which, by the same Sub-section is given ample opportunity for discussing them.

Photo of Mr Robert Taylor Mr Robert Taylor , Lincoln

Does the right hon. Gentleman not think that this is a violation of the central principle of the Act—that the means tests should be abolished for contributory pensions under the Act? What justification is there for refusing the full benefits of the contributory system merely because men have had to contribute to a superannuation fund as a condition of employment?

Photo of Mr Rhys Davies Mr Rhys Davies , Westhoughton

Before the right hon. Gentleman answers that question, may I ask why this information was not sent out to approved societies, so that applicants for membership might have the information before they joined?

Mr. CHAMBERLAIN:

In answer to the first supplementary question, obviously this is not in conflict with any principle in the Act, because it is in accordance with the provisions of the Act itself which I have quoted. As to the second part of the supplementary question by the hon. Member for Lincoln (Mr. Taylor) the difference does not arise because they are in receipt of superannuation allowances, it is, as I stated in my answer, because their contributions when they were paying as excepted members were reduced contributions, because they were only paying in respect of widow's pensions. Therefore the full contribution has not been received by the Fund in respect of them, and we are obliged to make a distinction to save the finances of the Fund. With regard to the supplementary question as to why this information was not sent out, the information is published in the Regulations, and is available, of course, to the approved societies.

Photo of Mr Robert Taylor Mr Robert Taylor , Lincoln

Is it not the fact that voluntary contributors under these Regulations will, in effect, be subject to a means test, and that their pension will be scaled down according to the number of years they have been in the fund?

Mr. CHAMBERLAIN:

The limitations which are imposed under the Regulations are in accordance with the provisions of the Act. As I have already stated, it is a fact that persons over a certain age will only be entitled under these Regulations to reduced benefits, and the reason for that I have already explained twice.

Photo of Mr Robert Taylor Mr Robert Taylor , Lincoln

62.

asked the Minister of Health whether the employés of a local authority who are paying the full rate of contribution necessary to qualify for old age pensions at 65 under The Widows', Orphans', and Old Age Contributory Pensions Act, 1925, will be treated as entitled to the full pension of 10s. per week for themselves and their wives on attaining the age of 65 years without any deduction on account of payments made to them out of superannuation funds established under the Local Government Officers' Superannuation Act of 1922?

Mr. CHAMBERLAIN:

The employes of a local authority which has not obtained exception from insurance for old age pensions, and is, therefore, required to pay the full rate of contribution under the Contributory Pensions Act, will, together with their wives, be entitled, on the usual conditions, to old age pensions on attaining 65, without any deduction.

Photo of Mr Robert Taylor Mr Robert Taylor , Lincoln

Will men over 45, who come into insurance under this arrangement, be entitled to full benefits, while the voluntary contributor, who is paying the full contribution, will not be entitled to full benefit?

Mr. CHAMBERLAIN:

The hon. Member is referring to voluntary contributors and non-voluntary contributors. I have already pointed out that the employés of the local authority, who have not obtained exemption from insurance for old age pension, will be entitled to the full old age pension without reduction.

Photo of Mr Thomas Kennedy Mr Thomas Kennedy , Kirkcaldy District of Burghs

83.

asked the Minister of Health whether, in view of the help rendered by the local pensions committees to applicants for the old age pension, he will consider the advisability of utilising the same machinery for dealing with applicants for benefit under the Widows', Orphans', and Old Age Contributory Pensions Act?

Mr. CHAMBERLAIN:

Specific provision is made in the Widows', Orphans', and Old Age Contributory Pensions Act for dealing with applicants for benefit thereunder, and the machinery so set up is materially different from that established by the Old Age Pensions Acts, 1908 to 1924. I have, therefore, no power to adopt the suggestion of the hon. Member.