Part XReview and Alteration of Benefits

C5C4C2C3150Annual up-rating of benefits

C61

The Secretary of State shall in each tax year review the sums—

a

specified in the following provisions of the Contributions and Benefits Act—

F36i

Schedule 4 (excluding the provisions of Parts 1, 3 and 5 of the Schedule that specify amounts mentioned in section 150A(1) below); and

ii

section 44(4) so far as relating to the lower rate of short-term incapacity benefit; and

iii

paragraphs 2(6)(c) and 6(2)(b) of Schedule 8;

F1aa

specified in regulations under section 30B(7) of that Act;

F28ab

specified in regulations under section 39(2A) or section 39C(1A) of that Act;

F56ac

specified in regulations under section 52(3) of that Act;

b

specified in regulations under section 72(3) or 73(10) of that Act;

c

which are the additional pensions in long-term benefits;

F2ca

which are shared additional pensions;

d

which are the increases in the rates of retirement pensions under Schedule 5 to the Contributions and Benefits Act;

F19dza

which are lump sums to which surviving spouses F24or civil partners will become entitled under paragraph 7A of that Schedule on becoming entitled to a Category A or Category B retirement pension;

F3da

which are the increases in the rates of shared additional pensions under F20paragraph 2 of Schedule 5A to that Act;

e

which are—

i

payable by virtue of F4section 15(1) of the Pensions Act to a F42relevant person (including sums payable by virtue of F4section 17(2)); or

ii

payable to such a person as part of his Category A or Category B retirement pension by virtue of an order made under this section by virtue of this paragraph or made under section 126A of the 1975 Act or section 63(1)(d) of the 1986 Act;

F15f

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

g

falling to be calculated under paragraph 13(4) of Schedule 7 to that Act;

h

prescribed for the purposes of section 128(5) or 129(8) of that Act or specified in regulations under section 135(1) F16of that Act;

i

specified by virtue of section 145(1) of that Act;

j

specified in section 157(1) of that Act or in regulations under F17section 166(1)(b), 171ZE(1) F39, F53171ZN(2E)(b) F69, 171ZY(1) or 171ZZ9(1);

F5k

specified in regulations under sections 4(2) or (5) of the Jobseekers Act 1995;

F18l

specified in regulations under sections 2 or 3 of the State Pension Credit Act 2002 F29(other than those prescribing the amounts mentioned in section 150A(1)(d) below);

F37m

specified in regulations under section 2(1)(a) or (4)(c) or 4(2)(a) or (6)(c) of the Welfare Reform Act 2007;

F45n

specified in regulations under sections 9 to 12 of the Welfare Reform Act 2012;

F47o

specified in regulations under section 78(3) or 79(3) of that Act;

F55p

which are the increases in the rates of state pensions under section 17 of the Pensions Act 2014;

F68q

specified in regulations under section 30 of the Pensions Act 2014 (bereavement support payment);

in order to determine whether they have retained their value in relation to the general level of prices obtaining in Great Britain estimated in such manner as the Secretary of State thinks fit.

F401A

In subsection (1)(e)(i) “relevant person” means a person—

a

who became entitled to a Category A or Category B retirement pension before the day on which section 2(1) of the Pensions Act 2011 comes into force, and

b

to whom sums became payable by virtue of section 15(1) of the Pension Schemes Act 1993 (including sums payable by virtue of section 17(2)) before that day.

1B

In subsection (1A)—

a

a reference to becoming entitled to a pension before a day includes a reference to becoming entitled on or after that day to the payment of a pension in respect of a period before that day;

b

a reference to sums becoming payable before a day includes a reference to sums becoming payable on or after that day in respect of a period before that day.

2

Where it appears to the Secretary of State that the general level of prices is greater at the end of the period under review than it was at the beginning of that period, he shall lay before Parliament the draft of an up-rating order—

a

which increases each of the sums to which subsection (3) below applies by a percentage not less than the percentage by which the general level of prices is greater at the end of the period than it was at the beginning; and

b

if he considers it appropriate, having regard to the national economic situation and any other matters which he considers relevant, which also increases by such a percentage or percentages as he thinks fit any of the sums mentioned in subsection (1) above but to which subsection (3) below does not apply; and

c

stating the amount of any sums which are mentioned in subsection (1) above but which the order does not increase.

3

This subsection applies to sums—

a

specified in Part I, F6paragraphs F301 to 5 of Part III, Part IV or Part V of Schedule 4 to the Contributions and Benefits Act F26(excluding the provisions of Parts 1 and 5 of the Schedule that specify amounts mentioned in section 150A(1) below);

b

mentioned in subsection (1)(a)(ii) or (iii), F7(aa),F31(ab), (b), (c), (d), F21(dza), (e) F48, (g) or (o) above.

4

Subsection (2) above shall not require the Secretary of State to provide for an increase in any case in which it appears to him that the amount of the increase would be inconsiderable.

5

The Secretary of State may, in providing for an increase in pursuance of subsection (2) above, adjust the amount of the increase so as to round any sum up or down to such extent as he thinks appropriate.

6

Where subsection (2) above requires the Secretary of State to lay before Parliament the draft of an order increasing any sum that could be reduced under section 154(1) below, the order may make such alteration to that sum as reflects the combined effect of that increase and of any reduction that could be made under that subsection.

7

If the Secretary of State considers it appropriate to do so, he may include in the draft of an up-rating order, in addition to any other provisions, provisions increasing any of the sums for the time being specified in regulations under Part VII of the Contributions and Benefits Act F8or under the Jobseekers Act 1995,F38, the State Pension Credit Act 2002 or Part 1 of the Welfare Reform Act 2007F46or Part 1 of the Welfare Reform Act 2012 or which are additions to income support under regulations made under section 89 of the 1986 Act.

F32The reference to regulations under the State Pension Credit Act 2002 does not include those prescribing the amounts mentioned in section 150A(1)(d) below.

F547A

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

8

The Secretary of State shall lay with any draft order under this section a copy of a report by the Government Actuary or the Deputy Government Actuary giving that Actuary's opinion on the likely effect on the National Insurance Fund of such parts of the order as relate to sums payable out of that Fund.

9

If a draft order laid before Parliament in pursuance of this section is approved by a resolution of each House, the Secretary of State shall make the order in the form of the draft.

10

F49Subject to subsection (10ZA), an order under this section—

a

shall be framed so as to bring the alterations to which it relates into force—

i

in the week beginning with the first Monday in the tax year F33following that in which the order is made; or

ii

on such earlier date in April as may be specified in the order;

b

may make such transitional provision as the Secretary of State considers expedient in respect of periods of entitlement—

i

to F9working families' tax credit;

ii

to F9disabled person's tax credit; or

iii

to statutory sick pay, running at the date when the alterations come into force.

F5010ZA

An order under this section shall be framed so that—

a

any alteration to any of the sums referred to in subsection (1)(n) or otherwise specified in regulations under Part 1 of the Welfare Reform Act 2012 (universal credit) comes into force in relation to a person on the relevant day; and

b

any other alteration to which the order relates comes into force, for the purposes of determining the amount of universal credit to which a person is entitled, on the relevant day.

10ZB

In subsection (10ZA) “relevant day”, in relation to a person, means the first day of the first universal credit assessment period in respect of the person which begins on or after—

a

the Monday of the week specified in subsection (10)(a)(i), or

b

any earlier date specified under subsection (10)(a)(ii).

F1010A

Where a member of F43a scheme which was at a time before F576 April 2012 (the date appointed for the commencement of section 15(1) of the Pensions Act 2007) an appropriate personal pension scheme or a money purchase contracted-out scheme continues in employment after attaining pensionable age and the commencement of his pension under the scheme is postponed, the preceding provisions of this section shall have effect as if—

a

the guaranteed minimum pension to which he is treated as entitled by virtue of section 48(2)(a) of the Pensions Act were subject to increases in accordance with the provisions of section 15(1) of that Act; and

b

the amounts of any notional increases referred to in paragraph (a) above were subject to annual up-rating in the same way as if they were sums to which subsection (1)(e)(i) above applied.

F4110B

Subsection (10A) does not have effect unless—

a

the member became entitled to a Category A or Category B retirement pension before the day on which section 2(2) of the Pensions Act 2011 comes into force, and

b

the member's postponed pension under the scheme became payable before that day.

10C

In subsection (10B)—

a

a reference to becoming entitled to a pension before a day includes a reference to becoming entitled on or after that day to the payment of a pension in respect of a period before that day;

b

a reference to a pension becoming payable before a day includes a reference to a pension becoming payable on or after that day in respect of a period before that day.

11

So long as sections 36 and 37 of the M1National Insurance Act 1965 (graduated retirement benefit) continue in force by virtue of regulations made under Schedule 3 to the M2Social Security (Consequential Provisions) Act 1975 or under Schedule 3 to the Consequential Provisions Act, regulations may make provision for applying the provisions of this section—

F11a

to the amount of graduated retirement benefit payable for each unit of graduated contributions,

b

to increase of such benefit under any provisions made by virtue of section 24(1)(b) of the Social Security Pensions Act 1975 or section 62(1)(a) of the Contributions and Benefits Act, and

c

to any addition under section 37(1) of the National Insurance Act 1965 (addition to weekly rate of retirement pension for widows and widowers) to the amount of such benefit.

F2512

So long as sections 36 and 37 of the National Insurance Act 1965 continue in force as mentioned in subsection (11), this section applies as if subsections (1) and (3) included the sums mentioned in subsection (13).

13

Those sums are lump sums to which surviving spouses or civil partners will become entitled, by virtue of regulations made under section 62(1)(c) of the Contributions and Benefits Act, on becoming entitled to—

a

a Category A or Category B retirement pension; or

b

graduated retirement benefit.

C7C8150AF27Annual up-rating of basic pension etc. and standard minimum guarantee

1

The Secretary of State shall in each tax year review the following amounts in order to determine whether they have retained their value in relation to the general level of earnings obtaining in Great Britain—

F58za

the amount specified in regulations under section 3(1) of the Pensions Act 2014 (full rate of state pension);

a

the amount of the basic pension;

b

the specified amounts in the case of Category B, C or D retirement pensions;

c

the specified amounts in the case of industrial death benefit; and

d

the amounts of the standard minimum guarantee for the time being prescribed under section 2(4) and (5)(a) and (b) of the State Pension Credit Act 2002.

2

Where it appears to the Secretary of State that the general level of earnings is greater at the end of the period under review than it was at the beginning of that period, he shall lay before Parliament the draft of an order which increases each of the amounts referred to in subsection (1) above by a percentage not less than the percentage by which the general level of earnings is greater at the end of the period than it was at the beginning.

3

Subsection (2) above does not require the Secretary of State to provide for an increase in any case if it appears to him that the amount of the increase would be inconsiderable.

4

The Secretary of State may, in providing for an increase in pursuance of subsection (2) above, adjust the amount of the increase so as to round the sum in question up or down to such extent as he thinks appropriate.

5

The Secretary of State shall lay with a draft order under this section a copy of a report by the Government Actuary or the Deputy Government Actuary giving that Actuary's opinion on the likely effect on the National Insurance Fund of any parts of the order relating to sums payable out of that Fund.

6

If a draft order laid before Parliament under this section is approved by a resolution of each House, the Secretary of State shall make the order in the form of the draft.

7

F51Subject to subsection (7A), an order under this section shall be framed so as to bring the increase in question into force in the week beginning with the first Monday in the tax year following that in which the order is made.

F527A

An order under this section shall be framed so that any alteration to which the order relates comes into force, for the purposes of determining the amount of universal credit to which a person is entitled, on the relevant day.

7B

In subsection (7A) “relevant day”, in relation to a person, means the first day of the first universal credit assessment period in respect of the person which begins on or after the Monday of the week specified in subsection (7).

8

For the purposes of any review under subsection (1) above the Secretary of State shall estimate the general level of earnings in such manner as he thinks fit.

9

If a draft order under this section is combined with a draft up-rating order under section 150 above, the report required by virtue of subsection (5) above may be combined with that required by virtue of section 150(8) above.

10

In this section—

  • “the amount of the basic pension” means the first amount specified in section 44(4) of the Contributions and Benefits Act (weekly rate of Category A retirement pension);

  • “the specified amounts in the case of Category B, C or D retirement pensions” means—

    1. a

      the amount specified in paragraph 5 of Part 1 of Schedule 4 to the Contributions and Benefits Act, F59...

    2. b

      the F60amount specified in paragraph 7 of Part 3 of that Schedule F61, and

    3. c

      any amount specified in regulations under section 78(9) of the Contributions and Benefits Act for a Category C retirement pension;

  • “the specified amounts in the case of industrial death benefit” means—

    1. a

      the amounts specified in paragraph 10 of Part 5 of that Schedule (apart from the amount of the initial rate), and

    2. b

      the amount specified in paragraph 11 of that Part of that Schedule.

151Up-rating—supplementary

1

Any increase under section 150 above of the sums mentioned in subsection (1)(c) of that section shall take the form of a direction that those sums shall be increased by a specified percentage of their amount apart from the order and shall apply F12subject to section 156 and only in relation to additional pensions calculated under section 45 of the Contributions and Benefits Act by reference to final relevant years which are—

a

earlier than the tax year preceding that in which the order comes into force; or

b

if the order comes into force on or after 6th May in any tax year, earlier than that year.

2

Any increase under section 150 above of the sums mentioned in F22subsection (1)(d), F62(dza), (e) or (p) of that section shall take the form of a direction that those sums shall be increased by a specified percentage of their amount apart from the order and F63—

a

F23, in the case of the sums mentioned in subsection (1)(d) or (e) of that section, shall apply only in relation to sums calculated under Schedule 5 to the Contributions and Benefits Act by reference to periods of deferment which have ended before the coming into force of the order F64, and

b

in the case of the sums mentioned in subsection (1)(p) of that section, shall apply only in relation to sums calculated under section 17 of the Pensions Act 2014 by reference to periods which have ended before the coming into force of the order.

3

An increase in a sum such as is specified in section 150(1)(e)(ii) above shall form part of the Category A or Category B retirement pension of the person to whom it is paid and an increase in a sum such as is specified in section 150(1)(e)(i) above shall be added to and form part of that pension but shall not form part of the sum increased.

4

Where an increment under F13section 15(1) of the Pensions Act—

a

is increased in any tax year by an order under F13section 109 of that Act; and

b

in that year also falls to be increased by an order under section 150 above,

the increase under that section shall be the amount that would have been specified in the order, but for this subsection, less the amount of the increase under F13section 109.

F445

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

6

Any increase under section 150 above of any of the sums which are additions to income support mentioned in section 150(7) above shall take the form of a direction that any such sum shall be increased by a specified percentage of its amount apart from the order.

151AF65Up-rating of transitional state pensions under Pensions Act 2014

1

The Secretary of State must, in each tax year, review the general level of prices in Great Britain and any changes which have taken place.

2

If on a review it appears to the Secretary of State that the general level of prices has increased during the review period, the Secretary of State must make an order specifying a percentage by which the amounts mentioned in the following provisions of the Pensions Act 2014 are to be increased—

a

section 9;

b

paragraph 4(3) of Schedule 2;

c

paragraphs 5(3) and 6 of Schedule 4;

d

paragraphs 5(3) and 6 of Schedule 9.

3

The percentage specified in the order must not be less than the percentage by which the general level of prices has increased during the review period.

4

This section does not require the Secretary of State to make an order if it appears to the Secretary of State that the effect of the order on the amounts referred to in subsection (2) would be inconsiderable.

5

F66Subject to subsection (5A), an order under this section must be framed so as to bring the increase in question into force in the week beginning with the first Monday in the tax year following that in which the order is made.

F675A

An order under this section must be framed so that any alteration to which the order relates comes into force, for the purposes of determining the amount of universal credit to which a person is entitled, on the relevant day.

5B

In subsection (5A) “relevant day”, in relation to a person, means the first day of the first universal credit assessment period in respect of the person which begins on or after the Monday of the week specified in subsection (5).

6

The Secretary of State must lay with a draft order under this section a copy of a report by the Government Actuary or the Deputy Government Actuary giving that Actuary's opinion on the likely effect on the National Insurance Fund.

7

If a draft order under this section is combined with a draft up-rating order under section 150 or 150A, the report required by virtue of subsection (6) may be combined with that required by virtue of section 150(8) or 150A(5).

8

For the purposes of any review under this section the Secretary of State may estimate the general level of prices in such manner as the Secretary of State thinks fit.

152Rectification of mistakes in orders under section 150 F35or 150A

1

If the Secretary of State is satisfied that a mistake (whether in computation or otherwise) has occurred in the preparation of the previous order under section 150 above, he may be order vary the amount of any one or more of the sums specified in an enactment mention in subjection (1)(a) of that section by increasing or reducing it to the level at which it would have stood had the mistake not occurred.

F341A

If the Secretary of State is satisfied that such a mistake has occurred in the preparation of the previous order under section 150A above, he may by order vary the amount of any one or more of the amounts referred to in subsection (1) of that section by increasing or reducing it to the level at which it would have stood had the mistake not occurred.

2

Where the amount of any such sum is varied under this section, then, for the purposes of the next review and order under that section, the amount of the sum shall be taken to be, and throughout the period under review to have been, its amount as so varied.

C1153Annual review of child benefit

The Secretary of State shall review the level of child benefit in April of each year, taking account of increases in the Retail Price Index and other relevant external factors.

154Social security benefit in respect of children

1

Regulations may, with effect from any day on or after that on which there is an increase in the rate or any of the rates of child benefit, reduce any sum specified in any of the provisions mentioned in subsection (2) below to such extent as the Secretary of State thinks appropriate having regard to that increase.

2

The provisions referred to in subsection (1) above are the following provisions of Schedule 4 to the Contributions and Benefits Act—

a

paragraph 6 of Part I (child's special allowance);

F14b

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F14c

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

d

paragraph 7 of Part V (increase of weekly rate of disablement pension in respect of child dependants);

e

paragraph 12 of Part V (allowance in respect of deceased's children).