asked the Minister for Social Welfare if he can give an approximate estimate of the total annual amount of (1) increased stamp charge and (2) Exchequer contributions under the Social Welfare (Amendment) Bill, 1960.
Ceisteanna—Questions. Oral Answers. - Social Welfare (Amendment) Bill, 1960: Increased Stamp Charge of Exchequer Contributions.
5.
It is estimated that the increases in contribution rates proposed in the Social Welfare (Amendment) Bill, 1960, will yield approximately £4,075,000 in a full year.
In the absence of statistics of the number of persons over age 70 who were formerly insured, it is not possible to frame a reliable estimate of the cost of old age (contributory) pensions. Tentative estimates of the cost of these pensions and of the cost of the other proposals in the Bill indicate that the additional Exchequer contributions to the Social Insurance Fund will be of the order of £2,850,000 a year. There will, of course, be a saving in pensions under the Old Age Pensions Acts, and taking this into account the net annual charge on the Exchequer resulting from the Bill, apart from increased administration expenses, is taken to be in the region of £300,000.
Might I ask the Parliamentary Secretary with reference to the figure of £4,000,000 odd which he says is the probable approximate annual cost of the increased stamp charge, am I to take it that that would represent approximately £2,000,000 on the employers and £2,000,000 on the employees?
Approximately.
Per annum?
Yes—the increased charge?
Yes.
Is it to be taken from the Parliamentary Secretary's reply, therefore, that the Minister for Social Welfare is not now adhering to the principle that the State will contribute one-third to an insurance fund to provide for the benefits outlined in the amending Bill?
Under the Bill, as the Deputy will find, the State contributes about 41 per cent. of all the cost.
The Parliamentary Secretary did say that there would be a substantial amount of savings on existing old age pensions which would very much offset the cost of the proposal.
The State contributions still exceed 41 per cent.
There are more than old age pensions involved in the Bill.
Could I perhaps clarify? Am I correct in interpreting what the Parliamentary Secretary said by saying that under the new Bill the employers will contribute approximately £2,000,000. the employees will contribute approximately £2,000,000 and the Exchequer will contribute its share of that, but that offset against the contribution by the Exchequer, we may expect that a number of persons at present receiving non-contributory pensions will cease to receive them as a result of getting contributory pensions——
That is right.
——and that that will represent a saving to the Exchequer which will reduce its net contribution under the statute to something in the order of £350,000?
That is correct.