Pension Schemes

Work and Pensions written question – answered on 12th February 2004.

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Photo of Steve Webb Steve Webb Shadow Secretary of State for Work and Pensions

To ask the Secretary of State for Work and Pensions if he will estimate public expenditure on the state second pension in each year from 2006–07 to 2015–16 based on (a) present policies and (b) no new state second pension entitlement being accrued in respect of contributions made from 2005–06 onwards.

Photo of Malcolm Wicks Malcolm Wicks Minister for pensions, Department for Work and Pensions

The information requested is set out in the following table.

Projected expenditure on the state second pension based on (a) current policies and (b) if accruals were to cease from April 2005 onwards—£ billion, 2003–04 price terms
(a) (b)
2006–07 0.3 0.2
2007–08 0.4 0.3
2008–09 0.6 0.4
2009–10 0.8 0.5
2010–11 1.0 0.6
2011–12 1.2 0.7
2012–13 1.4 0.8
2013–14 1.7 0.8
2014–15 1.9 0.9
2015–16 2.2 1.0


1. The projected expenditure to pensioners shown above does not allow for (i) expenditure on state second pension paid alongside bereavement benefits to those below state pension age, (ii) expenditure on contracted-out rebates, or (iii) any effects on income-related benefit expenditure of the various policies considered.

2. The projected expenditure has been calculated on a consistent basis to that used for the projections in the Quinquennial Review of the National Insurance Fund as at April 2000 (Cm 6008), assuming real earnings growth of 2 per cent. a year. No allowance has been made for the effects of the most recent (2002-based) population projections, or any other information which has become available since the results underlying the Quinquennial Review were prepared.

3. The projected expenditure relates to the GB National Insurance Fund (Northern Ireland has a separate Fund).

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