HC Deb 15 June 1982 vol 25 cc721-2
16. Mr. Robert Hughes

asked the Secretary of State for Social Services how much it would now cost to restore the 5 per cent. cut in invalidity benefit; and how many people would have their incomes increased by restoration of the cut.

Mr. Newton

The estimated net cost in 1982–83 of restoring the 5 per cent. cut in invalidity benefit is £50 million. The numbers of invalidity pensioners who would have their incomes increased by restoration is estimated to be 620,000.

Mr. Hughes

The Minister will be aware that the 5 per cent. cut was introduced in lieu of taxation and that there are 600,000 currently suffering an adverse poll tax. Will he give a categoric assurance that the benefit will be restored in full and that the Government will not cheat as they did on unemployment benefit?

Mr. Newton

Yes. I can give that categoric assurance. Indeed, it has been given on many occasions by my right hon. and hon. Friends.

Mr. McQuarrie

My hon. Friend has stated that the estimated cost of restoring the cut is only £50 million and that about 650,000 would enjoy the benefit of the restoration. Bearing in mind his personal interest in invalids, will he do his utmost to ensure that restoration takes place in the course of this year?

Mr. Newton

We estimate that the amount of tax that would be paid on bringing the benefit into tax would be rather higher than £50 million. It seems certain that almost all invalidity pensioners would pay tax if it were taxable.

Mr. Alfred Morris

When is it now proposed to tax invalidity benefit? Why has the timetable gone wrong?

Mr. Newton

As my right hon. and learned Friend the Chancellor of the Exchequer said in his Budget Statement last year, implementation has been put off for 1982. No further date has yet been given. Obviously it is for my right hon. and learned Friend to give a date.