Scotland

Scottish independence: Brown says Scotland's pensions protected by UK

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Media captionGordon Brown: ''It is right to keep our British pensions''

Scottish pensioners are "better protected" while Scotland shares "risks and resources" with the rest of the UK, according to Gordon Brown.

In a speech for Better Together, which opposes Scottish independence, he said pensioner numbers in Scotland were rising faster than the UK average.

Dr Eilidh Whiteford, the SNP's pensions spokeswoman, said the former prime minister's claims were "ludicrous".

She said pensions would be more affordable for an independent Scotland.

Mr Brown said Scots have paid UK National Insurance "all our lives" and it is "right" that the UK bears the costs.

'Rising cost'

Speaking at Glasgow University, he said the independence debate should not be about whether voters are "for Scotland or for the union".

"In fact the real debate is between two Scottish visions of Scotland's future," he said.

"The nationalist one based on the breaking of all political links with the UK, and our vision based on a strong Scottish Parliament backed up by a system of pooling and sharing risks and resources across the UK.

"The whole point of sharing risks and resources across the UK is that it is right and proper that the British welfare state bears the rising cost of Scottish pensions as the number of old people will rise from one million to 1.3 million."

Mr Brown said previously unpublished Department for Work and Pensions (DWP) figures and estimates show:

  • Scotland pays 8% of UK National Insurance but receives "upwards of 9%" of the benefits
  • the "extra benefit" Scotland receives in terms of pensions (the gap between contributions and returns) will rise from £425m to £700m per year over the next 20 years
  • the UK will "underwrite" Scotland's estimated £100bn public sector pensions bill. He will say this is 10% of the UK total - while Scotland has just 8% of the UK population
  • it would cost about £1bn for Scotland to administer the first years of a separate pensions and benefits system once IT costs were included - which Mr Brown said "makes no sense"

Mr Brown said it was "fairer and better" for the UK's "faster-rising" working-age population to cover the cost of the rising number of elderly people in Scotland.

"We have contributed in UK National Insurance all our lives to spread the risks of poverty in retirement," he said.

"The SNP government has said the case for independence should be judged on whether Scotland would benefit financially or not.

"It is clear that pensioners are better protected when the risks are spread across the UK and it is also clear that in the year the SNP want independence the Scots pension bill alone is three times the income from oil revenues."

'Pensions unaffected'

Dr Whiteford, who speaks on work and pensions issues for the SNP at Westminster, said: "The claims Gordon Brown is making on pensions are simply ludicrous.

"The reality is that pensions are more affordable in Scotland than in the rest of the UK, a view supported by the National Institute of Economic and Social Research, who have also made clear that the demographic challenge is no more significant for Scotland than it is to the rest of the UK.

"We also know that insurance providers, including HSBC and the Department of Work and Pensions itself, are clear that pensions would be unaffected following a Yes vote."

Dr Whiteford questioned why Mr Brown cited the NHS as a positive example of being in partnership with the rest of the UK, while the Conservatives are "destroying its founding values".

She added: "With independence we will be able to ensure a fair deal for pensioners, with a triple lock on the state pension to keep pace with the cost of living, a review of the pension age to ensure it is right for Scotland's pensioners and a fair approach to public sector pensions."

On 18 September, Scotland's voters will take part in a referendum on the question: "Should Scotland be an independent country?"