2015 No. 187

Social Security

The Social Security Revaluation of Earnings Factors Order 2015

Made

Laid before Parliament

Coming into force

In accordance with section 148(2) (revaluation of earnings factors) of the Social Security Administration Act 19921, the Secretary of State has reviewed the general level of earnings obtaining in Great Britain.

The Secretary of State has concluded, having regard to earlier orders made under section 1482, that earnings factors3 for the relevant tax years have not, during the period taken into account for that review, maintained their value in relation to the general level of earnings.

The Secretary of State makes the following Order in exercise of the powers conferred by sections 148(3) and (4) and 189(1), (4) and (5) of the Social Security Administration Act 19924.

Citation and commencement1

This Order may be cited as the Social Security Revaluation of Earnings Factors Order 2015 and comes into force on 6th April 2015.

Revaluation of earnings factors2

The earnings factors for tax years specified in the Schedule to this Order in so far as they are relevant—

a

to the calculation—

i

of the additional pension in the rate of any long-term benefit, or

ii

of any guaranteed minimum pension5; or

b

to any other calculation required under Part 3 of the Pension Schemes Act 19936 (including that Part as modified by or under any other enactment),

are directed to be increased for those tax years by the percentage of their amount shown opposite those tax years in that Schedule.

Rounding of fractional amounts3

Where any earnings factor relevant to the calculation specified in article 2(a)(i) of this Order, as increased in accordance with this Order, would not but for this article be expressed as a whole number of pounds, it shall be so expressed by rounding down any fraction of a pound less than one half and rounding up any other fraction of a pound.

Signed by the authority of the Secretary of State for Work and Pensions.

Steve WebbMinister of State,Department for Work and Pensions

SCHEDULEPercentage increase of earnings factor for specified tax years

Article 2

Tax year

Percentage increase

1978-1979

754.4

1979-1980

654.1

1980-1981

530.0

1981-1982

427.6

1982-1983

379.2

1983-1984

345.0

1984-1985

312.0

1985-1986

286.5

1986-1987

254.9

1987-1988

230.4

1988-1989

204.0

1989-1990

174.4

1990-1991

155.7

1991-1992

132.2

1992-1993

118.1

1993-1994

107.7

1994-1995

101.4

1995-1996

93.0

1996-1997

87.7

1997-1998

78.8

1998-1999

70.9

1999-2000

64.0

2000-2001

54.3

2001-2002

48.4

2002-2003

42.2

2003-2004

37.3

2004-2005

32.3

2005-2006

27.1

2006-2007

22.9

2007-2008

18.0

2008-2009

13.3

2009-2010

9.9

2010-2011

8.6

2011-2012

6.1

2012-2013

4.3

2013-2014

2.4

2014-2015

1.5

EXPLANATORY NOTE

(This note is not part of the Order)

This Order is made following a review under section 148 (revaluation of earnings factors) of the Social Security Administration Act 1992 (c. 5).

This Order directs that the earnings factors relevant to the calculation of the additional pension in the rate of any long-term benefit or of any guaranteed minimum pension, or to any other calculation required under Part 3 of the Pension Schemes Act 1993 (c. 48), are to be increased for the tax years specified in the Schedule to the Order by the percentage of their amount specified in that Schedule.

The percentages specified in this Order for the tax years from and including 2000 – 2001 are also relevant for the purposes of revaluing state scheme pension debits and credits in accordance with sections 45B(6), 55A(5) and 55B(6) of the Social Security Contributions and Benefits Act 1992 (c. 4).

The percentage for the tax year 2014 – 2015 is 1.5%. The percentages for earlier tax years have been increased so that the earnings factors for those years are revalued at 2014 – 2015 earning levels.

This Order also provides for rounding fractional amounts for earnings factors relevant to the calculation of the additional pension in the rate of any long-term benefit. By virtue of section 23(2) of the Social Security Contributions and Benefits Act 1992 (c. 4), rounding is not required for the purpose of the calculation of any guaranteed minimum pension.

A full impact assessment has not been produced for this instrument as it has no new impact on business or civil society organisations.