Eilidh Whiteford – 2014 Parliamentary Question to the Department for Work and Pensions

The below Parliamentary question was asked by Eilidh Whiteford on 2014-07-16.

To ask the Secretary of State for Work and Pensions, with reference to the impact assessment of the single-tier pension published in October 2013, if he will make an estimate of how many people reaching state pension age after implementation of the single-tier pension in (a) the UK and (b) Scotland would have been eligible for savings credit in (i) 2020 and (ii) 2030 had savings credit not been abolished.

Steve Webb

The full rate of the new State Pension will give an income above the basic means test, rewarding retirement income saving.

It is estimated that in 2020 around 10% of pensioner households receiving the new State Pension, around 200,000 benefit units, in Great Britain would be eligible for the Savings Credit element of Pension Credit if it had not been removed for people who reached State Pension age after the introduction of new State Pension in April 2016.

By 2030, it is estimated that 15% of the new State Pension households, around 1 million benefit units, would be in this position.

Not all of these people would take up their eligibility to Savings Credit. The Department estimates that take-up amongst people eligible for only the Savings Credit element of Pension Credit is between 43% and 48%.

Breakdowns of the impact analysis by country or region within Great Britain are not available.

It is estimated that retaining Savings Credit for all pensioners and uprating it line with earnings would lead to additional annual costs in the UK of around £2bn in 20 years’ time.