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Lord Lester of Herne Hill asked Her Majesty's Government:

Baroness Scotland of Asthal: We consider that the power conferred by the European Communities Act 1972 would confer authority to combat discrimination on grounds of colour, in the course of implementing the Race Directive (Council Directive 2000/43/EC), if this power had not already been used to make good any shortfall in Community competence in certain areas of the 1976 Act corresponding to those mentioned in the directive (in order to deal with the limitation in Article 3.1 of the directive).

Lord Lester of Herne Hill asked Her Majesty's Government:

Baroness Scotland of Asthal: The concept of racial discrimination in the Race Directive (Council Directive 2000/43/EC) appears to be expressed more narrowly than the concept of racial discrimination in the International Convention on the Elimination of All Forms of Racial Discrimination (referred to in Recital (3) of the directive). Whereas the latter refers to "racial discrimination" as meaning "any distinction, restriction or preference based on race, colour, descent

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or national or ethnic origins", the former refers to "the principle of equal treatment" as meaning "that there shall be no direct or individual discrimination based on racial or ethnic origin". The elements of race and ethnicity appear to be common to both concepts, but not colour.

Disability Benefits: Recipients Aged over 50

Lord Newby asked Her Majesty's Government:

    How many people over 50 are currently in receipt of disability benefit in the United Kingdom; what proportion of the total population this represents; and what were the equivalent figures for 1980 and 1990.[HL3353]

The Parliamentary Under-Secretary of State, Department for Work and Pensions (Baroness Hollis of Heigham): Such information as is available is in the table. The information for 2003 is for the recipients of disability living allowance (DLA) and attendance allowance (AA). These benefits are paid as a contribution towards the extra costs faced by severely disabled people as a result of their disabilities. The information for 1980 and 1991 1 is for the recipients of AA and mobility allowance (Mob A).

Mob A was replaced by the higher rate of mobility component of DLA in 1992. From the same date, the middle and higher rate of care components of DLA replaced AA for people aged under 65 when they claim help with their disability-related extra costs. A new lower rate of mobility component and lowest rate of care component were also introduced as part of DLA from the same date.

Numbers of people aged 50 and over in the UK receiving AA and DLA on 28 February 2003 and the total of these as a proportion of the total UK population; and the equivalent figures for AA and Mob A recipients aged 50 and over in 1980 and 1991 1 .


AA(2)Mob A(3)DLATotal as a proportion of total UK population—per cent


Benefits. GB: for 2003, Information Analysis Directorate Information Centre; for 1980, 1990 and 1991, Social Security Statistics Publications.

NI: Statistics & Research Branch, Department for Social Development.

Population. 1980 for NI, mid-year estimates from the NI Statistics & Research Agency; otherwise, for both GB and NI, the Office for National Statistics.


1. Figures for 1991 are provided instead of 1990, because figures for 1990 are not available for NI. Figures for 1990 for GB only are AA, 640,000; Mob A, 443,000; total as a proportion of total GB population, 2.0 per cent.

2. Figures for 1980 and 1991 for AA are: for GB, at 30 September 1980 and 31 March 1991; and for NI, at 31 December 1980 and 1991.

3. Figures for mobility allowance are for GB at 31 March, and NI at 31 December.

4. From 1992, the lower age limit for AA is 65.

5. Figures for GB for 2003 are from a 5 per cent sample of data. Other GB figures and all NI figures are from a 100 per cent count.

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Pensions Protection Fund: Costs

Lord Oakeshott of Seagrove Bay asked Her Majesty's Government:

    Whether they will set out their assumptions and methods of calculating the cost of £340 million to £375 million, assuming a £40,000–£66,000 salary cap, to private sector employers of introducing the Pensions Protection Fund, as noted on page 41 of Working and saving for retirement: action on occupational pensions (Cm. 5835); and[HL3361]

    With regard to the estimated cost of £340 million to £375 million to private sector employers of introducing the Pensions Protection Fund—

    (a) whether it is a one-off or annual cost;

    (b) whether it is for gross insurance premiums payable or net insurance premiums payable, or simply the extra administrative cost to the employers of the fund;

    (c) how many members of defined benefit schemes are employers expected to make payments to; and

    (d) what are estimated to be minimum and maximum payments into the fund per member.[HL3362]

Baroness Hollis of Heigham: The cost of £340 million to £375 million is the difference between the assets and the liabilities of the schemes taken over by the PPF in a year, using the following assumptions:

    (i) Data on the MFR funding levels of just over 1,000 schemes that had an MFR valuation with an effective date between April 1997 and April 2000 were used. Adjustments were made for each scheme in the sample in order to estimate the up-to-date funding position. The results were scaled up to the total for all private sector occupational pension schemes.

    (ii) The value of the liabilities if such schemes were to fall within the responsibility of the Pensions Protection Fund were estimated on a basis equivalent to midway between the current MFR basis and the full insurance buyout costs for the liabilities.

    (iii) The cost will obviously depend on the number of firms going insolvent. Allowance was made for the possibility of normal, poor and extreme years as far as bankruptcies are concerned, but on average over a 20-year period, the probabilities of a scheme becoming a liability of the PPF were assumed to be between about 0.3 per cent a year for large schemes and 1 per cent a year for small schemes. This assumed level of bankruptcy is cautious, especially given that it is very rare for large companies to go bankrupt.

    (iv) Allowance was made for the impact of the suggested salary cap using data on the earnings of occupational schemes members from the Family Resources Survey.

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The cost of £340 million to £375 million is an estimated annual cost that represents the estimated overall annual levy needed to meet the benefit funding shortfall of schemes eligible for compensation from the PPF (see above). The flat-rate levy will be in respect of all members of defined benefit schemes (active, deferred members and pensioners), approximately 15 million members in total. The cost per individual member will be the flat-rate levy, with an additional cost depending on the level of underfunding in the scheme. All costs are gross of corporation tax.


As set out on page 41 of Working and saving for retirement: Action on occupational pensions, the estimated cost of £340 million to £375 million is based on a cap of £40,000–£60,000, not £40,000–£66,000, as cited in the Question.

Economic and Monetary Union

Lord Lester of Herne Hill asked Her Majesty's Government:

    What steps they intend to take to ensure that the five tests for the United Kingdom's entry into economic and monetary union are met within a prescribed period of time; and[HL3301]

    Whether they consider it probable that the United Kingdom will enter the economic and monetary union within the next five years.[HL3302]

The Parliamentary Under-Secretary of State, Department for Culture, Media and Sport (Lord McIntosh of Haringey): In his Statement to Parliament on 9 June 2003, the Chancellor of the Exchequer announced major reforms, right for the British economy, reforms which will be implemented over the next year and will greatly assist the process of achieving sustainable and durable convergence and the flexibility necessary for Britain to succeed sustainably within the euro-zone and realise its potential for trade and investment.

The Government believe there is a realistic prospect of making significant progress on this reform agenda over the next year. We will report on progress in the Budget next year.

Lord Lester of Herne Hill asked Her Majesty's Government:

    In the context of the decision to join the euro-zone, what is their understanding of the likely effect of variable rate financing in the United Kingdom housing market on consumer spending.[HL3335]

Lord McIntosh of Haringey: I refer the noble Lord to UK membership of the single currency: An assessment of the five economic tests (Cm 5776) published on 9 June 2003.

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