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Income Related Benefit Savings from Pensions Split after Divorce

Baroness Hollis of Heigham asked Her Majesty's Government:

Lord Mackay of Ardbrecknish: Estimates of the savings incurred were revisited for the House of Commons Committee stage of the Pensions Bill; it is now estimated that the net reduction in income related benefits if pensions could be split after divorce would be £70 million per year in 2025. This figure is based on estimates provided by the Government Actuary's department of the number of people who will have divorced after 1996, by sex, current age and age at the time of divorce.

In making this estimate it has been assumed that half of the average difference between a husband and wife's occupational pension accrued up to the time of divorce will be transferred from the husband to the wife in all divorces that involve occupational pension rights. For every £1 transferred from husband to wife, approximately £0.30 is likely to be saved from income related benefits.

Estimates of how savings are distributed on a yearly basis up to 2020 are not available.

Social Security Policy: Implications for VAT Revenue

Earl Russell asked Her Majesty's Government:

Lord Mackay of Ardbrecknish: Projections of VAT revenues were generally informed by the public expenditure and tax changes announced in the Budget.

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Social Security Policy: Implications for Inland Revenue

Earl Russell asked Her Majesty's Government:

    Under the Treasury guidelines which demand that a department considering policy changes consider the resource implications for other departments, what implications for the Inland Revenue have been identified as resulting from the changes in Housing Benefit for the under 25s, announced in the Social Security Uprating Statement.

Lord Mackay of Ardbrecknish: No resource implications for the Inland Revenue have been identified.

Social Security Policy: Cost Implications for the Department of Health

Earl Russell asked Her Majesty's Government:

    Given that Treasury guidelines demand that any department planning policy changes consider the resource implications for other departments, what cost implications for the Department of Health were identified in considering the proposals for lone parents announced in the Social Security Uprating Statement.

Lord Mackay of Ardbrecknish: The cost implications for the Department of Health were assessed as negligible.

Social Security Policy: Implications of Housing Benefit Proposals

Earl Russell asked Her Majesty's Government:

    Further to Lord Lucas' Written Answer of 28 November (H.L. Deb., col. WA 39), whether any increase in rough sleeping is planned for as a result of the measures on housing benefit for the under 25s announced in the Social Security Uprating Statement.

Lord Mackay of Ardbrecknish: Under these proposals, housing benefit will continue to meet, in full, rents which are at or below the general level of rents for non self-contained accommodation in the locality. This is the type of accommodation that young people tend to occupy if they have to meet the rent from their own resources. These measures will discourage those claiming housing benefit from taking more expensive accommodation than they would be able to afford if they were not dependent on benefit, but they should not prevent young people from finding suitably priced accommodation.

Benefits: Instrument of Payment Fraud

Earl Russell asked Her Majesty's Government:

    Whether the Benefits Agency, when it detects "instrument of payment" fraud, uses a multiplier to

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    calculate the amount of such fraud, and if so, what is that multiplier.

Lord Mackay of Ardbrecknish: The Benefits Agency does not use a multiplier in its calculation of the amount of instrument of payment (IOP) fraud. The amount of IOP fraud recorded is the face value of the IOP that has been prevented from encashment following the intervention of fraud staff. This is the amount of a Girocheque or, in the case of an order book, the value of foils remaining in the book.

Benefits: Savings from Student Disentitlement

Earl Russell asked Her Majesty's Government:

    Whether they accept the estimate by Mr. Robert Jackson, MP Official Report, Commons 27 November 1995, col. 958) that student disentitlement to social security benefits would save £200 million, and if not, what they believe to be the correct figure.

Lord Mackay of Ardbrecknish: The removal of entitlement to social security benefits from the majority of full-time students in September 1990 saved an estimated £79 million at the point of change. Savings since then cannot be calculated given the effects of other benefit changes and economic factors. (The resources available to students from September 1990 were increased overall, as over £200 million was made available through student loans and assistance from Access Funds.)

Social Security Policy: Implications of Proposals on Asylum Seekers

Earl Russell asked Her Majesty's Government:

    What cost implications for the Department of the Environment were identified, under the Treasury guidelines which require any department considering policy changes to consider the resource implications for other departments, as arising from the proposals on Income Support for Asylum Seekers announced in the Social Security Uprating Statement.

Lord Mackay of Ardbrecknish: The Department of Social Security identified that its proposals would result in a number of asylum seekers losing entitlement to housing benefit earlier than they would have done under existing arrangements. This could result in cost implications for local authorities, who would retain their existing responsibilities for those asylum seekers who fulfilled the criteria as statutorily homeless people under the Housing Act 1985. This department has discussed, and is continuing to discuss, these cost implications with the Department of the Environment. In addition, the Secretary of State for Social Security is currently considering the report of the Social Security Advisory Committee, which carried out a public consultation exercise on these proposals, and the result of separate consultations with local authority associations.

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International Trade: Unit of Price Measurement

Lord Kennet asked Her Majesty's Government:

    Whether, in view of the fluctuations in the value of the dollar, they are giving consideration to establishing an alternative measurement for the pricing of international trade, and, in particular, of oil.

Lord Mackay of Ardbrecknish: This is entirely a matter for the private sector.

Money Laundering

Lord Kennet asked Her Majesty's Government:

    Whether they consider that placing unlawfully obtained funds in secret accounts is a human right which must not be infringed.

Lord Mackay of Ardbrecknish: No. Appropriate controls on unlawfully obtained funds cannot amount to an infringement of the human rights of those making or facilitating such deposits. In the UK it is an offence to help another person to launder the proceeds of serious crime, whether by putting money into a bank account or in some other way. Banks and other financial businesses must have internal procedures requiring staff to report suspicions of money laundering to the police. Banking confidentiality is overridden by the anti-money laundering legislation.

Swiss Banks: Acceptance of Funds

Lord Kennet asked Her Majesty's Government:

    Whether they will make representations to the Swiss Government to prevent the banks within their jurisdiction from holding or receiving substantial sums of money from leaders of former administrations in countries including South Korea, the Philippines and Mexico, and from the Nigeria junta and the ex-Soviet Union.

Lord Mackay of Ardbrecknish: No. Whether banks within the jurisdiction of the Swiss Government should be prevented from accepting sums of money from any particular source is a matter for the Swiss authorities to decide in accordance with Switzerland's domestic law and its international obligations.

WEU: Use of NATO Assets

Lord Kennet asked Her Majesty's Government:

    Whether they accept the view expressed by a NATO official in relation to the possible use by the Western European Union (WEU) of United States-provided NATO assets (reported in Aviation Week 20 March 1995, page 55) to the effect that the United States is reluctant to "lay out large assets without a say in how they are to be used [....] It's like

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    giving your kid the keys to the car with no strings attached".

The Parliamentary Under-Secretary of State, Ministry of Defence (Earl Howe): It is not the custom to comment on views attributed to an ally by an individual. The NATO Summit Declaration of 11 January 1994 makes clear that the provision of collective Alliance assets for WEU operations will be on the basis of consultation in the North Atlantic Council.


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