Social Security (Jersey) Law 1974: Pension Age Amendments

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demonstrating that good governance, and clear lines of accountability and authority, are in place around decisions-making – including the reasons and basis on which a decision is made, and the action required to implement a decision
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A decision made 1 August 2014:

Decision Reference: MD-S-2014-0098
Decision Summary Title :	DS – Amending Orders in respect of State Pension Age increase		Date of Decision Summary:	29 July 2014
Decision Summary Author:	Policy Principal		Decision Summary: Public or Exempt?	Public
Type of Report: Oral or Written?	Written		Person Giving Oral Report:	N/A
Written Report Title :	WR – Amending Orders in respect of State Pension Age increase		Date of Written Report:	29 July 2014
Written Report Author:	Policy Principal		Written Report : Public or Exempt?	Public
Subject: Amendments to Social Security and Income Support Orders to align terms describing pensionable age with primary legislation in the Social Security (Jersey) Law 1974
Decision(s): The Minister made 2 Orders amending terms relating to pensionable age to accord with the increase in pension age under the Social Security (Jersey) Law 1974.
Reason(s) for Decision: On the 17th June 2014 the States approved legislation to increase the State pension age from 65 to 67. This increase will be phased in commencing on 1st January 2020 Amendments are necessary to align the provisions of the following Orders with the increased pension age in primary legislation; Income Support (General Provision) (Jersey) Order 2008; Social Security (Accident Benefit) (Jersey) Order 1974; Social Security (Contributions) (Jersey) Order 1975 and the Social Security (Incapacity Benefits) (Jersey) Order 2004
Resource Implications: None
Action required: Policy Principal to notify the Greffe and the Law Draftsman that the Order has been made and to forward the signed and sealed Order to the States Greffe, requesting the Greffier of the States to arrange for the Orders to be notified to the States.
Signature:		Position: Minister
Date Signed:		Date of Decision (If different from Date Signed):

Social Security (Jersey) Law 1974: Pension Age Amendments

Social Security Department

Ministerial Decision Report

Amending Orders in Respect of State Pension Age Increase

On the 17th June 2014 the States approved legislation to increase the State pension age from 65 to 67. The increase will take place over a 12 year period commencing 2020 and was brought into effect by Social Security (Amendment of Law No 7) (Jersey) Regulation, which –

- increased pensionable age from 65 to 67

- commenced increases in pensionable age from 1 January 2020

- increased the number of contribution years (including credited contributions) required for a full pension from 45 to 47

Orders made under the Social Security and Income Support Laws also make references to pensionable age and it is necessary to amend these references so they accord with the new pensionable age which has been established in primary legislation. The following amendments have been prepared

Income Support (General Provision) (Jersey) Order 2008

The calculation of capital and income disregards varies in the Income Support Law according to household circumstances and age. This order currently makes reference to persons having attained age 65. These references are amended to include provisions regarding people who have reached pensionable age as given in the Social Security Law.

Social Security (Accident Benefit) (Jersey) Order 1974

Entitlement to a lump sum benefit is calculated according to age and this order makes reference to people who have or have not yet attained age 65. ‘Age 65’ is replaced with a reference to pensionable age as given in the Social Security Law.

Social Security (Incapacity Benefits) (Jersey) Order 2004

Similar to Accident benefit above – the calculation of incapacity benefit refers to age 65, replaced with a reference to pensionable age as given in the Social Security Law.

Social Security (Contributions) (Jersey) Order 1975

This Order describes circumstances in which people who have attained the age of 60 may choose not to pay class 2 contributions. The age at which such an option may be taken has increased in line with State pension age and this order is amended to substitute age 60 with the age given in Schedule 1AA, introduced by the Social Security (Amendment of Law No 7) (Jersey) Regulation.

Financial and Resource Implications – There are no financial or resource implications resulting from the decision to amend these orders. The amendments allow consistent application of primary legislation in respect of State pension age.

Adopting an increase to SPA does have considerable impact on the Social Security Fund. P.73/2014 noted the following;

“These changes to legislation will have no impact until 2020. From 2020 onwards, the total cost of old age pensions to be met through the Social Security Fund will be lower than it would have been if the SPA was to remain at 65. Models produced by the Government Actuary’s Department project savings in the cost of old age pensions of £27 million by 2032 (2012 prices). Further financial benefit will be realised in additional contributions to the Fund, from people working longer.”

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