§ Q55. Mr. Peter Bottomley
asked the Prime Minister if she will estimate the cost of achieving a £2 post-tax increase in the income of a two-child family by (a) increasing child benefit, (b) increasing the married man's tax allowance and (c) increasing the average level of male earnings.
§ The Prime Minister
To achieve a £2 post-tax increase in the weekly income of a two-child family by raising child benefit would mean an increase of £1 per child at a cost of £550 million in a full year. Alternatively, to increase the net income of a basic rate taxpayer by £2 a week, the married man's tax allowance would need to be raised by £350, at a full year cost of £1,170 million. To achieve a £2 increase in net income, gross earnings would need to rise by around £3.25 per week for households paying income tax at the basic rate and national insurance contributions at the contracted-in rate and earning less than the NIC upper limit. A figure for the cost corresponding to those for the first two options cannot be given in this last case.