The Department of Social Care wishes to clarify that it does not intend to make any changes to the Manx Pension Supplement Scheme until 2016 at the earliest.  A supplementary report from the independent team which has been looking at the Scope of Government in the Isle of Man was published on Friday 11th May.  This report included a proposal to “phase out or limit recipients for the Manx Pension Supplement” on the grounds that this would result in major savings in revenue expenditure.  The Department believes this suggestion may have caused some anxiety among existing pensioners and so the Department wishes to reassure them.

The Minister for Social Care Hon Chris Robertshaw MHK said: “The pension supplement is funded out of National Insurance contributions, not general revenue.  Therefore, it would be wrong to suggest that by cutting the pension supplement savings in revenue expenditure could be achieved.  In fact, if the rate of the pension supplement was reduced or if fewer people received it, then more pensioners would become eligible for means-tested income support which is funded from general revenue, therefore revenue costs would actually increase. 

“We know from the UK Government Actuary’s report received last year that the Island’s National Insurance Fund is sustainable in the longer term, provided we continue to increase the state pension age in line with the increasing average life expectancy.  This is a fair policy as it will ensure each generation continues to enjoy approximately the same period in receipt of the state pension as well as being financially sustainable for current and future generations.  Tynwald has recently approved an increase in the state pension age to 66 for both men and women to take effect in 2020, to mirror arrangements in the UK.  Furthermore, the UK Government has said that it will further increase state pension age to 67 by 2028 and the Island will follow suit under our reciprocal arrangements.

“The UK Government has also recently stated its commitment to the introduction of a single tier state pension, possibly from as early as 2016, at a weekly rate of around £140 at today’s values.  This will only be available to people reaching state pension age on or after the introduction date.  Again, in order to maintain existing reciprocal arrangements with the UK,  that change would need to be adopted in the Island.  These UK proposals are at an early stage.  Once more information is known, due consideration will be given to this and other policy options and recommendations made to Tynwald in order to protect the Island’s interests and to ensure Manx pensioners continue to enjoy an appropriate and affordable state pension.  In the meantime, I do hope those pensioners in receipt of the Manx pension supplement are suitably reassured by my statement.”