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Social Security

I am satisfied that the orders are compatible with the European convention on human rights. The uprating order will, as usual, increase most national insurance benefits by the retail prices index, which is 3.6 per cent, and increase most income-related benefits by the Rossi index, which as the House will know, excludes rent, mortgage interest, council tax and depreciation, and is 3 per cent. The guaranteed minimum pensions increase order sets out the amount by which contracted-out occupational pension schemes must increase members’ guaranteed minimum pensions that accrued between 1988 and 1997. Where the annual increase in the retail prices index exceeds 3 per cent., the guaranteed minimum pensions indexation requirement is capped at that level under the primary legislation. This year’s order therefore provides for an increase of 3 per cent. This year’s uprating adds more than £3.5 billion to Government spending and reinforces our commitment to build an active welfare state and to tackle poverty by helping those most in need. The order provides an extra £2.48 billion to pensioners, of which £300 million is above inflation, and an extra £560 million to disabled people and carers. When we came to power, one in four pensioners suffered the indignity of living below the poverty line. The poorest pensioners were expected to live on just £68.80 a week. This year’s uprating of the pension credit minimum guarantee means that from April no single pensioner need live on less than £119.05 a week and no couple on less than £181.70 a week. The basic state pension will have seen a real-terms rise of 9 per cent. since 1997.