Widows and widowers

The current position

The three main widows benefits are:

Widow’s payment - a lump sum payment of £1,000 (not taxable).

Widowed mother’s allowance - a weekly benefit paid to widows who have children or are pregnant (taxable). Made up of:

• a basic allowance of £66.75 pw (1999/2000 rates)
• additions for dependent children (£11.35/£9.90 for 1st child)
• an additional pension ie, State Earnings Related Pension (SERPS) based on late husbands contributions

A weekly benefit paid to widows who are age at least 45 when either their husband dies or widowed mother’s allowance ceases (taxable). Made up of:

• a basic widows pension paid at a rate of between £20.03 and £66.75 pw depending on the age the widow was when her late husband died; and
• an Additional Pension ie. State Earnings Related Pension (SERPS) based on late husbands contributions. The average amount of this element is £14.36 (24% of average total weekly entitlement.)

Entitlement depends on the husband having satisfied the contribution conditions (these are waived if he died of an industrial accident or disease). The widows pension and widowed mothers allowance are paid at a reduced rate if inadequate contributions have been paid. Entitlement ceases if she remarries and for any period for which she is cohabiting.

The Bill introduces a:

Bereavement payment of £2,000 paid to both widows and widowers on bereavement.

• A ‘Widowed Parent’s Allowance’ equivalent to a Widowed Mothers Allowance and including any Additional Pension (SERPs).
• A ‘bereavement allowance’ with no SERPs element paid for 6 months to widows and widowers aged between 45 and pensionable age at the time their spouse dies and over with no dependent children.
• only men and women widowed before the new provisions take effect will have entitlement to Incapacity Benefit on the basis of their late spouses contributions.
• Cohabitees whose partner has died will not be entitled to these benefits.

Two other measures are to be introduced by secondary legislation

• £10 of the widowed parents allowance will be disregarded in calculating entitlement to income related benefits such as income support.

• Men and women who are aged 55 and over when the new rules are introduced, who are widowed in the subsequent 5 years and whose bereavement allowance has expired will not be required to make themselves available for work and will be able to claim income support. Their income related benefit will include a premium to ensure their income is equal to the amount of the bereavement allowance.

Background - numbers of claimants

The number of people reliant on widows benefits in the 1960s was on average 600,000 a year. Since then the numbers have declined rapidly. 283,600 women were claiming in 1997.

Whereas widows benefits constituted 5% of total social security expenditure at the end of the 1960s, it is now around 1% of total spending (£1 million in 1997.)

Timetable and financial implications

The new proposals will not come into force until 2001 at the earliest. Existing claimants are to continue to be entitled under the rules in force at that time.

Changes in expenditure as a result of the welfare reform bill

• The overall package of ‘reform’ will actually produce savings for the Government of £475 a year in the long term. the consultation paper states that the savings will allow the Government ‘to support new areas of need we know we will have to met in the next 10 to 20 years, such as the consequences of an ageing population’. CPAG would welcome a more specific indication of how the money is to be used.

• CPAG is concerned that the proposed changes undermine the social insurance principle. CPAG believes there should be a full discussion of future of social insurance benefit and how the contributory principle might be updated to take account of modern work patterns and family structures.

• Means testing is to be extended. Widows pension is to be abolished and replaced by the 6 month bereavement allowance. The consultation paper shows that 22% of widows are in the bottom fifth of income distribution. Many such widows are in future likely to need to claim income support as a result.

Widowed parents allowance

Kevin Willis, an individual widowed father supported by CPAG, is challenging the decision to refuse him benefit on the basis that the current UK law is in breach of the UN Convention on Human Rights. The existing rules discriminate not only against fathers but also against the children in those families and the women who have paid contributions from which their children do not benefit. CPAG therefore welcomes the extension of bereavement benefits to widowers. We also welcome the proposal to disregard £10 of the widowed parents allowance in income related benefits (although we would like to see the living standards of all lone parents raised).

We regret, however, that it is not considered possible to effect this change until 2001. The policy change should be introduced as soon as possible and if not feasible before 2001, the benefit should be backdated. There is precedent for backdating benefit where a new group acquires access to benefit rights as a result of EC law. invalid care allowance was introduced for married women in 1988 it was backdated to 1984, the year in which UK legislation became subject to EC law.

CPAG regrets the fact bereavement allowance is not to be extended to parents who were cohabiting with their partners when they died. In 1997, 37% of children were born out of wedlock. The needs of those children, if bereaved are not less than those whose parents were married.

Bereavement payment

CPAG very much welcomes the fact that the bereavement payment is to be paid to both widows and widowers. We also welcome the doubling in its amount. The amount should be index linked so that it retains its value. If the original £1,000 widows payment had been index linked, it would have been worth £1260 by April 1991 and would now be worth over £1,500.

Bereavement allowance

Those hit by the replacement of the widows pension with bereavement allowance, will be widows over 45. Those aged over 55 will be entitled to claim income support, paid at the level of the bereavement allowance.

The government’s justification for the removal of widows benefit is made partly on the basis that widows no longer have the same degree of need for support; that far more women are working and ‘it is no longer the norm for women to be dependent on male earnings alone.’

In the light of this, it is relevant to examine the extent to which women, both widows and potential widows are economically independent. The research shows that although a relatively high proportion of women are active in the labour market by far the majority only work part time.

Proportion of widows working

It is still generally the case that women therefore remain economically dependent on men. Except for a minority, women’s lack of economic independence while bringing up children means they are ill placed to take on work after bereavement.

The ongoing income of a contribution based benefit such as widows pension is thus an important safeguard.

The bereavement allowance should give the bereaved person time for:

• grieving;
• reorganising home and taking care of financial matters connected with the bereavement and other adjustments;
• preparing to take up work.

Where the widow/widower has been a carer or responsible for rearing the children then they may need both access to education and training to cope with the world of work. Six months is not a sufficient period to allow the person to undertake work or training and certainly rules out, for example, a three year degree course. CPAG therefore recommends that the bereavement allowance is extended beyond 26 weeks to a longer period such as 2 or 5 years.

As a minimum, the Government should consider extending the period of payment (for example to three years) for people who were caring for their spouse immediately before bereavement

We would also ask the Government to reconsider the decision to deny the SERPs element to widows without dependent children. This is currently worth £14.36 pw (24% of their average total weekly entitlement.)