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Social Security

It is important for the people who have contacted the hon. Member for Coventry South (Mr Cunningham) to remember that we are changing two things. We are changing, first, the indexation of the basic state pension that they will receive, and secondly, the indexation of SERPS and therefore public sector pensions. Overall, most pensioners, and particularly those on lower incomes, will benefit net from the two changes taken together. In other words, although earnings are depressed at the moment, in the long term the earnings link is a substantial boost. The CPI change on average means about 0.8% or 0.9% less over the long run, and the earnings link means close to 2% extra, so people with very large private or public sector pensions will lose net, but people with smaller pensions—the people who are most worried about the changes—will probably gain net. I am grateful to the hon. Member for Ynys Môn (Albert Owen) for raising that point.