HC Deb 19 February 1990 vol 167 cc560-4W
Mr. Nellist

To ask the Secretary of State for Social Security if he will publish tables using the assumptions in his answer to the hon. Member for Bradford, West (Mr. Madden) on 22 June 1988,Official Report, columns 575–80, but using expenditure and benefit figures appropriate for families in Coventry, together with a column showing the extent of the differences resulting from the April 1988 social security changes.

Mrs. Gillian Shephard

[holding answer 6 February 1990]: The information requested is set out in the tables.

The tables use the methods and assumptions contained in the technical annex to the 1985 White Paper "Reform of Social Security" and in "Impact of the Reformed Structure of Income-Related Benefits" published in 1987. They illustrate the impact of the changes on claimants in April 1988, by comparing the results of applying the old and new benefits rules (with an assumed uprating for the fonner) to the personal circumstances of a sample of cases.

As indicated in the reply to the hon. Member for Bradford, West (Mr. Madden) on 22 June 1988, the result is a hypothetical comparison with what people might have got under the old system. The passage of time, and subsequent changes to the benefit scheme render such comparisons increasingly hypothetical and unrealistic.

It should be noted that, although the comparisons are based on average local authority housing charges in Coventry, they do not necessarily reflect either the wide variety of rents and domestic rates that people in the borough actually pay or real families' circumstances and their housing arrangements.

Finally, the comparisons take no account of the housing benefit transitional cash protection announced on 27 April 1988.

Old benefit system at hypothetical rates April 1988 Coventry local authority Married couple with 2 children aged 4 and 6
£ £ £ £ £ £ £ £ £ £ £ £
Earnings head 60.00 70.00 80.00 90.00 100.00 110.00 120.00 130.00 140.00 150.00 160.00 170.00
Tax 0.00 0.00 1.22 3.92 6.62 9.32 12.02 14.72 17.42 20.12 22.82 25.52
National insurance 3.00 4.90 5.60 6.30 7.00 9.90 10.80 11.70 12.60 13.50 14.40 15.30
Family income supplement 28.70 23.70 18.70 13.70 8.70 3.70 0.00 0.00 0.00 0.00 0.00 0.00
Child benefit 14.50 14.50 14.50 14.50 14.50 14.50 14.50 14.50 14.50 14.50 14.50 14.50
Rent 22.28 22.28 22.28 22.28 22.28 22.28 22.28 22.28 22.28 22.28 22.28 22.28
Rent rebate 18.78 17.53 16.28 15.03 13.78 12.26 10.18 6.88 3.58 0.00 0.00 0.00
Rates 6.21 6.21 6.21 6.21 6.21 6.21 6.21 6.21 6.21 6.21 6.21 6.21
Rate rebate 5.46 5.06 4.66 4.26 3.86 3.29 2.47 1.17 0.00 0.00 0.00 0.00
Fares to work 5.85 5.85 5.85 5.85 5.85 5.85 5.85 5.85 5.85 5.85 5.85 5.85
Free school meals 2.55 2.55 2.55 2.55 2.55 2.55 2.55 2.55 2.55 0.00 0.00 0.00
Free welfare milk 1.83 1.83 1.83 1.83 1.83 1.83 0.00 0.00 0.00 0.00 0.00 0.00
Net weekly spending power 94.48 95.93 97.36 97.31 97.26 94.57 92.54 94.34 96.27 96.54 102.94 109.34

New benefit system from April 1988 Coventry local authority Married couple with 2 children aged 4 and 6
£ £ £ £ £ £ £ £ £ £ £ £
Earnings head 60.00 70.00 80.00 90.00 100.00 110.00 120.00 130.00 140.00 150.00 160.00 170.00
Tax 0.00 0.00 1.22 3.92 6.62 9.32 12.02 14.72 17.42 20.12 22.82 25.52
National insurance 3.00 4.90 5.60 6.30 7.00 9.90 10.80 11.70 12.60 13.50 14.40 15.30
Family credit 40.32 34.65 28.99 24.37 19.75 16.67 12.19 7.71 3.23 0.00 0.00 0.00
Child benefit 14.50 14.50 14.50 14.50 14.50 14.50 14.50 14.50 14.50 14.50 14.50 14.50
Rent 22.28 22.28 22.28 22.28 22.28 22.28 22.28 22.28 22.28 22.28 22.28 22.28
Rent rebate 7.52 5.94 4.36 3.07 1.79 0.93 0.00 0.00 0.00 0.00 0.00 0.00
Rates 6.21 6.21 6.21 6.21 6.21 6.21 6.21 6.21 6.21 6.21 6.21 6.21
Rate rebate 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Fares to work 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Net income after housing costs 90.85 91.70 92.54 93.23 93.93 94.39 95.38 97.30 99.22 102.39 108.79 115.19
Difference between systems -3.63 -4.23 -4.82 -4.08 -3.33 -0.18 +2.84 +2.96 +2.95 +5.85 +5.85 +5.85

Old benefit system at hypothetical rates April 1988 Coventry local authority Married couple with 3 children aged 3, 8 and 11
£ £ £ £ £ £ £ £ £ £ £ £
Earnings head 60.00 70.00 80.00 90.00 100.00 110.00 120.00 130.00 140.00 150.00 160.00 170.00
Tax 0.00 0.00 1.22 3.92 6.62 9.32 12.02 14.72 17.42 20.12 22.82 25.52
National insurance 3.00 4.90 5.60 6.30 7.00 9.90 10.80 11.70 12.60 13.50 14.50 15.30
Family income supplement 32.90 30.50 25.50 20.50 15.50 10.50 5.50 0.50 0.00 0.00 0.00 0.00
Child benefit 21.75 21.75 21.75 21.75 21.75 21.75 21.75 21.75 21.75 21.75 21.75 21.75
Rent 22.28 22.28 22.28 22.28 22.28 22.28 22.28 22.28 22.28 22.28 22.28 22.28
Rent rebate 19.82 17.92 16.67 15.42 14.17 12.77 11.12 9.47 6.34 3.04 0.00 0.00
Rates 6.21 6.21 6.21 6.21 6.21 6.21 6.21 6.21 6.21 6.21 6.21 6.21
Rate rebate 5.79 5.18 4.78 4.38 3.98 3.49 2.84 2.19 0.96 0.00 0.00 0.00
Fares to work 5.85 5.85 5.85 5.85 5.95 5.85 5.85 5.85 5.85 5.85 5.85 5.85
Free school meals 5.10 5.10 5.10 5.10 5.10 5.10 5.10 5.10 5.10 5.10 2.55 0.00
Free welfare milk 1.83 1.83 1.83 1.83 1.83 1.83 1.83 1.83 0.00 0.00 0.00 0.00
Net weekly spending power 109.85 113.04 114.47 114.42 114.37 111.88 110.98 110.98 109.79 111.93 112.74 116.59

New benefit system from April 1988 Coventry local authority Married couple with 3 children aged 3, 8 and 11
£ £ £ £ £ £ £ £ £ £ £ £
Earnings head 60.00 70.00 80.00 90.00 100.00 110.00 120.00 130.00 140.00 150.00 160.00 170.00
Tax 0.00 0.00 1.22 3.92 6.62 9.32 12.02 14.72 17.42 20.12 22.82 25.52
National insurance 3.00 4.90 5.60 6.30 7.00 9.90 10.80 11.70 12.60 13.50 14.40 15.30
Family credit 51.72 46.05 40.39 35.77 31.15 28.07 23.59 19.11 14.63 10.15 5.67 1.19
Child benefit 21.75 21.75 21.75 21.75 21.75 21.75 21.75 21.75 21.75 21.75 21.75 21.75
Rent 22.28 22.28 22.28 22.28 22.28 22.28 22.28 22.28 22.28 22.28 22.28 22.28
Rent rebate 5.86 4.28 2.70 1.42 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Rates 6.21 6.21 6.21 6.21 6.21 6.21 6.21 6.21 6.21 6.21 6.21 6.21
Rate rebate 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Fares to work 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Net income after housing costs 107.84 108.69 109.53 110.23 110.79 112.11 114.03 115.95 117.87 119.79 121.71 123.63
Difference between systems -2.01 -4.35 -4.94 -4.19 -3.58 +0.23 +3.05 +5.87 +8.08 +7.86 +8.97 +7.04

Old benefit system at hypothetical rates April 1988 Coventry local authority Single person with 2 children aged 4 and 6
£ £ £ £ £ £ £ £ £ £ £ £
Earnings head 60.00 70.00 80.00 90.00 100.00 110.00 120.00 130.00 140.00 150.00 160.00 170.00
Tax 0.00 0.00 1.22 3.92 6.62 9.32 12.02 14.72 17.42 20.12 22.82 25.52
National insurance 3.00 4.90 5.60 6.30 7.00 9.90 10.80 11.70 12.60 13.50 14.40 15.30
Family income supplement 28.70 23.70 18.70 13.70 8.70 3.70 0.00 0.00 0.00 0.00 0.00 0.00
Child benefit 19.40 19.40 19.40 19.40 19.40 19.40 19.40 19.40 19.40 19.40 19.40 19.40
Rent 22.28 22.28 22.28 22.28 22.28 22.28 22.28 22.28 22.28 22.28 22.28 22.28
Rent rebate 17.56 16.31 15.06 13.81 12.30 10.65 8.57 5.27 1.97 0.00 0.00 0.00
Rates 6.21 6.21 6.21 6.21 6.21 6.21 6.21 6.21 6.21 6.21 6.21 6.21
Rate rebate 5.07 4.67 4.27 3.87 3.30 2.65 1.83 0.53 0.00 0.00 0.00 0.00
Fares to work 5.85 5.85 5.85 5.85 5.85 5.85 5.85 5.85 5.85 5.85 5.85 5.85
Free school meals 2.55 2.55 2.55 2.55 2.55 2.55 2.55 2.55 2.55 0.00 0.00 0.00
Free welfare milk 1.83 1.83 1.83 1.83 1.83 1.83 0.00 0.00 0.00 0.00 0.00 0.00
Net weekly spending power 97.77 99.22 100.65 100.60 100.12 97.22 95.19 96.99 99.56 101.44 107.84 114.24

New benefit system from April 1988 Coventry local authority Single person with 2 children aged 4 and 6
£ £ £ £ £ £ £ £ £ £ £ £
Earnings head 60.00 70.00 80.00 90.00 100.00 110.00 120.00 130.00 140.00 150.00 160.00 170.00
Tax 0.00 0.00 1.22 3.92 6.62 9.32 12.02 14.72 17.42 20.12 22.82 25.52
National insurance 3.00 4.90 5.60 6.30 7.00 9.90 10.80 11.70 12.60 13.50 14.40 15.30
Family credit 40.32 34.65 28.99 24.37 19.75 16.67 12.19 7.71 3.23 0.00 0.00 0.00
Child benefit 19.40 19.40 19.40 19.40 19.40 19.40 19.40 19.40 19.40 19.40 19.40 19.40
Rent 22.28 22.28 22.28 22.28 22.28 22.28 22.28 22.28 22.28 22.28 22.28 22.28
Rent rebate 1.44 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Rates 6.21 6.21 6.21 6.21 6.21 6.21 6.21 6.21 6.21 6.21 6.21 6.21
Rate rebate 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Fares to work 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Net income after housing costs 89.67 90.66 93.08 95.06 97.04 98.36 100.28 102.20 104.12 107.29 113.69 120.09
Difference between systems -8.10 -8.56 -7.57 -5.54 -3.08 +1.14 +5.09 +5.21 +4.56 +5.85 +5.85 +5.85

Old tax and benefit system—assuming average local authority rent and rates for Coventry and a simple rescaling of April 1987 benefits to April 1988. Lone mother with two children aged four and six.
Not working after one year on benefit Working part-time earning £20 Working part-time earning £40
£ £ £
Supplementary Benefit 45.93 30.89 14.35
Earnings — 20.00 40.00
Tax — 0.00 0.00
National Insurance — 0.00 2.00
Fares to Work — 2.92 2.92
Rent 22.28 22.28 22.28
Rates 6.21 6.21 6.21
Housing Benefit 26.92 26.92 26.92
Child Benefit 19.40 19.40 19.40
Free School Meals 2.55 2.55 2.55
Free Welfare Milk 1.83 1.83 1.83
Net Weekly spending power 68.14 70.18 71.64

Benefit system from April 1988
Assumptions as in Impact of reformed structure of income related benefits" October 1987
Average local authority rent and rates for Coventry.
Lone mother with two children aged 4 and 6
a. Not working after one year on benefit
Income Support 45.35
Rent 22.28
Rates 6.21
Housing Benefit 26.00
CHB 19.40
FSM 2.55
FWM 1.83
Net Weekly spending power 66.64
Difference between systems -1.50

Benefit system from April 1988
Assumptions as in "Impact of reformed structure of income related benefits" October 1987
Average local authority rent and rates for Coventry.
Lone mother with two children aged 4 and 6
b. Working part time earning £20 c. Working part time earning £40
Income Support 40.35 20.35
Earnings 20.00 40.00
Tax 0.00 0.00
NI 0.00 0.00
Fares to work 2.92 2.92
Rent 22.28 22.28
Rates 6.21 6.21
Housing Benefit 26.00 26.00
CHB 19.40 19.40
FSM 2.55 2.55
FWM 1.83 1.83
Net weekly spending power 78.72 78.72
Difference between systems +8.54 7.08