Pensions - Articles - National Insurance Fund back in the black as revenues surge

 Last year, the Treasury had to pay a top-up to maintain minimum levels in the NI Fund but no Treasury supplement has been required for 2017/18. The main reason for the improved position of the fund is an increase of over £5 billion in National Insurance Revenues, whilst spending only rose by £2 billion. One reason for the slower growth in spending is the increase in state pension ages together with squeezes on benefit upratings.

 The report also shows that the amount of money being paid in voluntary (Class 3) National Insurance Contributions has increased fivefold, from £12.8m in 2016/17 to £69.1m in 2017/18. This reflects the new opportunity provided by the new state pension for people to top up their contribution record and boost their state pension at discounted rates.

 Commenting, Steve Webb, Director of Policy at Royal London said: “With the National Insurance Fund running a surplus in 2017/18, any idea that pensions will have to be cut to stop the Fund running out of money can be firmly discounted. There is, of course, a long-term pressure on the public finances as the population ages, but these figures confirm that there is no short-term crisis. The report also shows that growing numbers of people are taking advantage of the chance to boost their state pension at ‘bargain basement’ rates. For the right people, the chance to top up their state pension through paying voluntary NI contributions represents an excellent investment”.
   

 Report on the state of the National Insurance Fund