FAMILY INCOME SUPPLEMENTS (COMPUTATION) REGULATIONS 1975 (Hansard, 15 May 1975)

§ Lord WELLS-PESTELL

My Lords, I beg to move that the draft Family Income Supplements (Computation) Regulations 1975, laid before the House on 1st May, be approved. The Family Income Supplements Act 1970 provides for the payment of a benefit for certain families with small incomes. The purpose of the Regulations is to increase the prescribed amounts for family incomes supplement and the maximum amounts payable, and for the changes to take effect from 22nd July of this year, a year after the previous uprating. The family income supplement scheme gives help to low income families where the head of the family is in full-time work and where there is at least one dependent child. The supplement is payable when weekly resources fall below a prescribed amount which varies according to the size of the family. The weekly rate of the benefit is one half of the amount by which the 947 family's total income falls below the prescribed amount subject to a maximum and minimum weekly payment.

We are now developing our own long-term plans, and the Child Benefit Bill which received its Second Reading in another place on 13th May contains our proposal for a new system of family support. The new scheme will help to reduce dependence on means tested benefits, such as family income supplement, but for the time being the family income supplement still has a worthwhile function.

For the one-child family the prescribed amount goes up from £25 per week to £31.50; for each additional child the prescribed amount will be £3.50 higher instead of £3 as at present for families entitled to the maximum weekly payment—at present £5.50 for families with one or two children and for other families £7. We propose to move to a more equitable system under which the maximum increases progressively with each child. The maximum weekly payment for the one-child family will go up to £7 and for larger families that amount is increased by 50p for each additional child after the first.

The effect of the increases in the prescribed amounts will be that families with one child will generally receive, subject to the operation of the new maxima, an extra £3.20 or £3.30 a week according to the rounding up, on top of their existing family income supplement award. And for each additional child the increases will be either 20p or 30p greater.

Your Lordships will recall that family allowances were increased on 8th April last. To prevent duplication of support, awards of family income supplements for claims made after 8th April 1975 will, where appropriate, take account of the increased family allowance payments. For claimants receiving family income supplement before the increase in family allowances we are arranging to adjust the family income supplement award when the new rate of supplement is paid.

948 The increases in prescribed amounts and maximum payments will provide much needed help during the year immediately following the uprating for some 70,000 families who are bringing up children on very low incomes. The total cost of a family income supplement during that year will be £11 million. This is within the existing departmental programme of expenditure. I have taken this rather briefly, my Lords, because I thought perhaps the House would prefer me to do so, and I hope that these Regulations will be welcomed by your Lordships. I beg to move.

§ Lord ABERDARE

My Lords, I am grateful to the noble Lord for having explained what this Order is about. Certainly he explained it clearly, even though briefly, and we welcome it. As he rightly said, it is an upgrading of the benefits under the Family Income Supplements Scheme and also some improvements in the Scheme itself, and these we welcome.

The Family Income Supplement has been of benefit, as the noble Lord acknowledged. I think he will probably remember, when we first introduced it, that it was never intended to last for ever. We had our own plans for a tax credit scheme which we still think would have been a valuable help in our social security provisions and would have obviated much means testing. Certainly in the meantime a family income supplement has brought considerable benefit to low-income families, and especially to one-parent families. For these reasons, we are very happy with this Order and have no objection to it.