Social Security Benefits Up-rating Order (Northern Ireland) 2015

Executive Committee Business – in the Northern Ireland Assembly at 12:00 pm on 27th April 2015.

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Photo of Mervyn Storey Mervyn Storey DUP 12:00 pm, 27th April 2015

I beg to move

That the Social Security Benefits Up-rating Order (Northern Ireland) 2015 be approved.

The uprating order is an annual order that sets out the rates of contributory and non-contributory benefits, together with the various allowances and premiums, that make up income-related benefits. Generally, the annual amounts from April each year are based on the increases in the general level of prices over the 12 months ending the previous September, measured using the consumer prices index (CPI), which is the measure of price inflation the Westminster Government consider most appropriate for this purpose.

At the end of September 2014, the CPI showed an increase of 1·2%. According to the latest data published by the Office for National Statistics (ONS), by February this year, that figure had fallen to zero and again remained at zero last month.

There has been some debate in the past about whether the CPI or the retail prices index (RPI) should be used as the measure; some people argue that using CPI will cost less. It is clear that there is no perfect measure of inflation, but uprating by CPI ensures that, at the very least, benefit levels maintain their value against inflation. In addition, some commentators consider that it better reflects the inflation experience of pensioners and benefit recipients.

In 2013, because of the national economic situation pertaining at that time, the Westminster Government brought forward the Welfare Benefits Up-rating Act 2013, which limits the increase in the majority of working-age benefits and statutory payments in Great Britain for 2014-15 and 2015-16 to 1%. Whenever the Secretary of State for Work and Pensions makes an uprating order under section 150 or 150A of the Social Security Administration Act 1992 or an order under the 2013 Act, my Department is empowered to make a corresponding order. There is no power to increase benefits by a different or greater percentage to that provided for in the orders made by the Secretary of State for Work and Pensions.

Basic state pension is increased by 2·5% to £115·95, which is an increase of £2·85 a week, and the minimum guarantee in state pension credit is increased by the same amount, taking a single person’s weekly income to £151·20. For couples, the increase is £4·35, taking their new total to £230·85 a week. Those facing additional costs because of a disability or those who may have less opportunity to increase their income through paid employment have seen their benefits rise by the increase in CPI. Therefore, disability living allowance, attendance allowance, carer’s allowance and the main rate of incapacity benefit have all risen by 1·2%, as did the employment and support allowance support group component and those disability-related premiums that are paid with pension credit and working-age benefits.

Other benefits have been increased by 1%. As a result of the uprating order, we will be spending an additional £94 million on social security in 2015-16 — money that will go into the local community and the local economy. I appreciate that many of us would like to do more, but, as I already stated, my Department is empowered to increase the rates of benefits only to the same extent as those payable in Great Britain.

I am sure that all Members will wish to ensure that people in Northern Ireland, including some of the most vulnerable in our society, can continue to receive the new increased rates of benefit. Therefore, I ask them to join me in supporting the order.

Photo of Alex Maskey Alex Maskey Sinn Féin

Go raibh maith agat, a Cheann Comhairle. I thank the Minister for bringing forward the statutory rule and for outlining the purpose behind it.

The Committee for Social Development first considered the proposal on 5 February 2014 and was content for the order to be made. We formally considered it on 12 March, and the Committee was again content to recommend that the Assembly affirm the statutory rule. As the Minister indicated, the order is already in operation, and today we are simply being asked to affirm it.

The order, as we just heard from the Minister, is one of a series of statutory rules relating to the annual uprating for rates of social security benefits, pensions and allowances. The implementation of the uprating proposals is expected to increase the Department's annually managed expenditure by approximately £94 million. The uprating order also includes provision to increase the weekly rate of ordinary and additional statutory paternity pay and statutory adoption pay, the responsibility for which lies with the Department for Employment and Learning. DSD informed the Committee that it consulted with that Department and that DEL is content with the proposals.

The Minister already referred to this, but the only issue of contention for the Committee, which I feel it is important to put on the record again, is that the increase in the uprating is linked to CPI. Others have contested that that is less advantageous. Nevertheless, that is the position that we are in. The Minister outlined the reasons for the uplift and the limitations on the Committee and the Assembly to do anything about it at this point.

On behalf of the Social Development Committee, I recommend that the order be affirmed by the Assembly.

Photo of Mervyn Storey Mervyn Storey DUP

I thank the Chair of the Social Development Committee and its members for the consideration that they gave to the matter and for the positive way in which they dealt with the order. As on previous occasions, I have taken note of why RPI is no longer used and why we now use CPI. I have no doubt that it is an issue that will continue to be raised in the future, but, as the Member knows, the outgoing coalition Government's view is that the consumer price index is the most appropriate measure for price inflation for this purpose. Therefore, it remains an issue that is in the domain of the national Government at Westminster.

I am certain that there will be a general welcome for the increases in the rates of benefits provided for by the uprating order, and I commend the motion to the House.

Question put and agreed to. Resolved:

That the Social Security Benefits Up-rating Order (Northern Ireland) 2015 be approved.