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State Second Pension

Mr. Boswell: To ask the Secretary of State for Work and Pensions what evidence he has collated to assess the relative attractiveness of (a) contracting out of the state second pension scheme and (b) remaining within it for those with average earnings of (a) 75 per cent., (b) 100 per cent. and (c) 125 per cent. of national average earnings. [32878]

Mr. McCartney [holding answer 6 February 2002]: In making any decision about pensions, individuals may consider both present earnings and their future prospects. In general we expect that contracting out will be the best option for most people but individuals will need to make choices that are appropriate to their current needs and aspirations for the future.

Benefit Payments (Hospital Stays)

Matthew Green: To ask the Secretary of State for Work and Pensions what the value is of reductions to (a) pensions and (b) other benefits made after a patient has been in hospital for over six weeks in each of the last five years; and how many patients have been affected by reductions to (i) pensions and (ii) benefits in each of the past five years. [33002]

Mr. McCartney: The information is not available in the format requested. Such information as is available is in the table.

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£ million

Incapacity benefitRetirement pensionSevere disablement allowance
Reduction in benefit with six to 52 weeks hospital downrating in place
Reduction in benefit with over 52 weeks hospital downrating in place


1. The information has been obtained from a number of administrative sources and a number of assumptions have been made, ie numbers marked * are taken from a small number of sample cases and are subject to a relatively high sampling error and should be used only as an indication of the current situation and it has been assumed that figures in a given quarter remain constant throughout the year.

2. Figures are rounded to the nearest million.

3. It is not possible to provide accurate total reductions for income support, housing benefit, or council tax benefit.

4. The figures are given in cash terms.


Mr. Cran: To ask the Secretary of State for Work and Pensions when a substantive reply will be given to Mrs. G. Twizell's letter of 23 November 2001, concerning the bereavement allowance. [36835]

Malcolm Wicks: I replied to the hon. Member on 20 February.

Andrew Mackinlay: To ask the Secretary of State for Work and Pensions when he will make a substantive reply to the letters from the hon. Member for Thurrock dated 29 January and 5 February, concerning his constituent, Andrew Palmer of East Tilbury. [37434]

Malcolm Wicks: I replied to my hon. Friend on 20 February.

Disability Service Teams

Mr. Webb: To ask the Secretary of State for Work and Pensions what plans he has to increase the budget for disability service teams; and if he will make a statement. [37585]

Mr. Nicholas Brown [holding answer 26 February 2002]: Disability service teams will become an integral part of Jobcentre Plus from April. We are investing significantly in the development of Jobcentre Plus and its services, including services for disabled people.

Pension Credit

Sandra Gidley: To ask the Secretary of State for Work and Pensions whether pensioner tax credit will serve as a qualifying benefit for warm front grants. [37638]

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Mr. McCartney: Subject to the agreement of the devolved Administrations and parliamentary scrutiny of the State Pension Credit Bill, it is intended that Pension Credit will serve as a qualifying benefit for warm front grants.

Minimum Income Guarantee (Cleethorpes)

Shona McIsaac: To ask the Secretary of State for Work and Pensions how many pensioners he estimates are claiming the minimum income guarantee in the Cleethorpes constituency. [37754]

Mr. McCartney: As at August 2001, there are 3,000 minimum income guarantee claimants in the parliamentary constituency of Cleethorpes.


Mr. Frank Field: To ask the Secretary of State for Work and Pensions what steps the Government have taken (a) to identify appropriate indicators for securing safe and sustainable pensions by the spring Council meeting in Barcelona and (b) to develop a national strategy report by September; and what plans he has to promote public participation in this process. [37761]

Mr. McCartney: Discussion on the possibility of developing pension indicators is being taken forward by the Economic Policy Committee and Social Protection Committee as part of their remit for taking work forward on objectives for safe and sustainable pension systems. The UK takes a full part in this work. We are also discussing with the Commission the best format for the national strategy reports that will outline the approaches of member states to meeting the objectives that have been agreed. The UK response will draw on the extensive public consultations on pension developments that have already taken place.

Benefit Fraud (North Lanarkshire)

Mr. Roy: To ask the Secretary of State for Work and Pensions when he will publish the inspection report of the Benefit Fraud Inspectorate in respect of North Lanarkshire council. [39536]

Malcolm Wicks: The Benefit Fraud Inspectorate report was published today in respect of North Lanarkshire council and copies of the report have been placed in the Library.

BFI Inspectors found that North Lanarkshire council is a poor performing authority that needs to make significant improvements to raise standards in almost every aspect of its benefits administration and counter fraud work. The report notes a lack of awareness of what constitutes a safe and secure benefits service at the council, despite an annual expenditure of more than £95 million on housing benefit and council tax benefit.

Inspectors noted that the council was using three different types of claim form and considered that none of them was up to standard. They recommend that North Lanarkshire introduces a single claim form based upon the national BFI model. This is seen as vital to help claimants to provide all the supporting evidence needed for a claim to be worked out accurately from the start.

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The report identifies weaknesses in a number of areas including the monitoring and control of benefit periods, the renewal of claims, and the way that the council deals with changes of circumstances to prevent overpayments. The council did not have a policy covering overpayments of benefit and had no management controls to show that overpayments were being dealt with correctly.

Inspectors also express concern over the council's benefit security procedures. They found that none of the key British Safety standards on security controls were being met. Inspectors consider that North Lanarkshire's benefits service is highly vulnerable to internal fraud.

The council's counter fraud policy was not being managed effectively. The report finds that the counter fraud team did not have enough staff to cope with the volume of work. Also, training and management direction was inadequate. Weaknesses were found in the council's IT security procedures, particularly on the standards of information security. The quality of investigative work was poor and inspectors considered that the council did not do enough to prevent fraud nor to deter repeat offenders. 80 per cent. of investigations examined by inspectors were found to be incomplete. Concern was also expressed in the report that the council did not refer cases to the Procurator Fiscal for prosecution.

The report concludes that the council was not effectively managing the administration of benefit or the risks from fraud. Key benefits related policies that were

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needed to provide clear direction to staff and stakeholders were not in place and a management information system was inadequate.

The report makes recommendations to help the council address weaknesses and to improve the administration of housing benefit and council tax benefit, as well as counter fraud activities.

My right hon. Friend the Secretary of State is now considering the report and will be asking the council for its proposals in response to the findings and recommendations of the BFI.

Pension Schemes Act

Dr. Kumar: To ask the Secretary of State for Work and Pensions if he will make a statement on the general and compensation levies payable under the Pension Schemes Act 1993 by occupational and personal pension schemes. [39537]

Mr. McCartney: There will be no increase in the General Levy rates for 2002–03. Rates will remain at the 2000–01 level as set out in the table. Levy receipts are buoyant due to the growth in the number of members for which the levy is payable. Although Opra's costs have increased and it will have added responsibilities for regulating speeding up the winding up of pension schemes in 2002–03, there will be sufficient funding without increasing the General Levy rates.

Although some payments have been made out of the pension compensation fund, it will not be necessary to raise a Compensation Levy in 2002–03.

Scheme rates

Scheme sizeBasis1999–20002000–012001–022002–03Minimum payment per scheme(6)
Occupational pensions
2 to 11Scheme11.0012.0012.0012.00
12 to 99Member1.
100 to 999Member0.850.900.900.90125
1,000 to 4,999Member0.690.700.700.70900
5,000 to 9,999Member0.530.530.530.533,500
Personal pensions
2 to 11Scheme3.755.205.205.20
12 to 99Member0.350.500.500.50
100 to 999Member0.250.350.350.3550
1,000 to 4,999Member0.200.300.300.30350
5,000 to 9,999Member0.,500

(6) Minimum payments ensure that schemes in the lower bands do not pay more overall than those the higher bands

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