HC Deb 05 March 1975 vol 887 c416W
Mr. Richard Wainwright

asked the Secretary of State for Social Services (1) what would be the net cost, taking into account the savings on other benefits, of introducing a tax-free child endowment, to replace family allowances and child tax allowances, for all children, including the first, over and above the cost of the increase in family allowances due to take effect in April 1975, at the following rates: 6½ per cent. of average male industrial earnings for children under 11 years, 8 per cent. of average earnings for children aged 11 to 15 years, 9½ per cent. of average earnings for dependent children aged 16 to 17 years, and 11 per cent. of average earnings for dependent children aged 18 years, respectively;

(2) what would be the net cost, taking into account the savings on other benefits, of introducing a tax-free child endowment, to replace family allowances and child tax allowances, for all children including the first at a rate for each child of 6½ per cent. of average male industrial earnings, over and above the cost of the increase in family allowances due to take effect in April 1975.

Mr. O'Malley

Using £50 as an estimate of average weekly earnings and on current rates of tax, the additional cost to the Exchequer in 1975–76 would be about £1,000 million and about £800 million, respectively, after allowing for the extra revenue flowing from the abolition of child tax allowances. The additional cost in public expenditure would be about double those figures.