54. Mr. C. I. Orr-Ewingasked the Chancellor of the Exchequer what would be the estimated cost to the Exchequer if, in place of the fixed allowance of £85 per child, an earned income child allowance were introduced, based on one-tenth of the parents' income, rising to a maximum allowance per child which would not exceed £150 per annum.
§ Mr. H. BrookeI assume my hon. Friend intends that the present allowance of £85 should be retained as a minimum applicable to incomes below £850. On this basis, the cost of increasing the child allowance for incomes above that level to 10 per cent. of income, with a maximum of £150, would be about £21 million in a full year. If, on the other hand, the allowance were restricted to 10 per cent. at all income levels, so that those with incomes below £850 received a smaller allowance than at present, there would actually be a net gain to the Exchequer of about £5 million.