§ Mr. Tebbit
asked the Chancellor of the Exchequer (1) pursuant to his reply of 24th June, what has been the fall in net take-home pay in real terms of a married worker with two young children drawing the average industrial wage since October 1974, and since March 1974, respectively; and how much extra in total gross pay in current 1977 prices he would have had to earn since each of those dates to maintain the purchasing power of his take-home pay at constant levels;
(2) if, pursuant to his Written Answer to the hon. Member for Chingford,Official Report, 11th November 1977, column267, that a married worker with two young children drawing the average industrial wage would have required an increase in gross pay of 8.2 per cent. and 11.5 per cent., respectively, to have maintained his purchasing power since March 1974 and October 1974, he will now convert those percentages into the aggregate cash amounts, in August 1977 terms, by which that worker's gross pay has fallen short of that required to maintain his net purchasing power at the earlier levels, so as to make his answer comparable with his answer of 24th June to the hon. Member for Chingford.
§ Mr. Robert Sheldon,
pursuant to his replies [Official Report, 15th November and 17th November 1977; Vol. 939, c.195 and349],gave the following information:
The aggregate extra gross pay to August 1977 needed to have maintained the purchasing power of take-home pay of a married worker with two young children since (a) October 1974 and (b) March 1974, is about (a) £742, and (b) £337. The calculation assumes that the worker had received each month the average earnings of a full-time manual worker. The extra pay needed each month has been adjusted to August 1977 price levels.
In the calculations for the period since March 1974 the extra pay needed from May 1975 onwards to preserve purchasing power at its March 1974 level has had offset against it the extra pay received from May 1974 to April 1975 when take-home pay was above its March 1974 level in real terms. Similar offsets were needed 709W for only three months in the calculation from October 1974.
This information is not precisely comparable with that in my reply given on 24th June, when the extra pay needed each month was added without regard to the changes in prices from the month in question to April 1977. On this basis, comparable figures would be an increase of £657 for the period since October 1974 to August 1977 and £333 for the period since March 1974 to August 1977.
All figures take account of the allowances in the Finance (Income Tax Reliefs) Bill.
The remaining information requested was given in my reply of 11th November.—[Vol. 938, c.267.]
§ Mr. Lawson
asked the Chancellor of of the Exchequer if he will publish a table showing (a) the real take-home pay and (b) the real net income of a married man with two children under 11 years of age in September 1977 and in September of each of the 10 previous years, all expressed in terms of September 1977 prices.
§ Mr. Robert Sheldon,
pursuant to his reply [Official Report, 17th November 1977; Vol. 939, c.349],gave the following information:
Assuming that the man is on average earnings, the figures are as follows:
Real weekly take-home pay at September 1977 prices Real weekly net income at September 1977 prices £ £ September— 1967 … … 55.56 56.76 1968 … … 54.93 57.05 1969 … … 54.37 56.80 1970 … … 61.37 63.64 1971 … … 62.88 64.94 1972 … … 66.83 68.76 1973 … … 67.18 68.95 1974 … … 67.12 68.63 1975 … … 64.06 66.05 1976 … … 63.16 64.89 1977 … … 60.35 62.85
"Take-home pay" is gross earnings less income tax and national insurance Contributions; "net income" is take-home pay plus family allowance for years up to 1976 and child benefits for 1977.
Average earnings for years up to 1969 are the Department of Employment's 710W October Survey estimates of the average earnings of full-time adult male manual workers adjusted to give an estimated figure for the preceding September by the monthly index of average earnings. For later years the April New Earnings Survey estimates of the average earnings of full-time adult male workers in all occupations, manual and non-manual, have been updated by the index of average earnings to give estimates for the following September.
The price index used is the General Index of Retail Prices—all items for the appropriate month.
For years up to and including 1974 it has been assumed that the employee was not contracted out of the graduated pension scheme.
For September 1977 the figures incorporated the allowances in the Finance (Income Tax Reliefs) Bill.