HL Deb 01 November 1957 vol 205 cc777-8WA
LORD HAWKE

asked Her Majesty's Government—

  1. (1) What was the percentage increase in the cost of living between September, 1947, and September, 1957;
  2. (2) After taxation based on the Finance Act, 1947, what net incomes were produced by gross incomes of £1,000, £1,500, £2,000, £3,000, £5,000, £10,000 and £20,000;
    3. 778
  3. (3) Based on the answer to (1), what gross incomes are required to-day to produce the same purchasing power as the net incomes in the answer to (2);
assuming in (2) and (3), the case of a married man with two children and with the maximum earned income relief.

VISCOUNT HAILSHAM

1. 52 per cent. This is the change in the Consumer Price Index up to 1956 pushed forward by the change in the retail price index during the first nine months of 1957.

2–3. The answer to part 2 and 3 of the question are as follows:—

Gross Income in 1947 Net income in 1947, after tax at 1947 rates Gross income in 1957, to yield, after tax at 1957 rates, net income with the same purchasing power
£ £ s. d. £ s. d.
1,000 786 5 0 1,424 8 0
1,500 1,098 15 0 2,137 4 0
2,000 1,373 15 0 2,848 2 0
3,000 1,811 5 0 4,169 3 0
5,000 2,511 5 0 7,194 13 0
10,000 3,586 5 0 18,436 10 0
20,000 4,311 5 0 33,196 18 0

It has been assumed that the two children are both under 11 for the purpose of calculating the final column. If the children were between 11 and 16 and their allowance £250 instead of £200 the figures in the third column would be rather lower (e.g. at £5,000 gross income in 1947 the equivalent 1957 income would be £7,123 5s. 0d.).

It has also been assumed that the income is all earned.