APPENDIX 6
Letter to the Clerk of the Committee from
the Rt Hon the Baroness Castle of Blackburn (PC 07)
Dear Mr Moon,
The points I wish to make on the dangers of
the Pensioners' Credit were broadly set out in the second reading
speech I made on the State Pension Credit Bill in the House of
Lords on 18 December 2001. I can summarise as follows:
1. The Pension Credit is a recognition of
the strength of the argument I and other Peers have made of the
affects of means-testing in reducing incentives to save and/or
earn. It is a complicated system which will further confuse pensioners
but its broad effect is to extend substantially the number of
pensioners on means-test.
2. The problem of take-up is even more severe
than in the case of MIG. In spite of the recent Government campaign
to improve the take-up of MIG, successful applications only increased
by 120,000. The take-up of The Pension Credit is likely to be
even less.
3. Nowhere are we told what is likely to
be the administrative cost of pension credit and some of us suspect
the reason is that it would be very high. It will certainly be
higher than for State Pensions like SERPS.
I and others will be tabling more detailed amendments
to the Government's proposals during the Committee Stage of the
Bill and we hope the Government will consider them very serious.
Barbara Castle
9 January 2002
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