HC Deb 28 May 1976 vol 912 cc480-3W
Mr. Kenneth Clarke

asked the Secretary of State for Social Services whether or not child benefits paid after April 1977 will be deducted from any national insurance or social security benefits otherwise payable to a family.

Mr. Ennals

The rate of national insurance benefit payable for a first qualifying child will be reduced to take account of the child benefit payable for the first child, to which I referred in my statement in the House on 25th May. Child benefit will be taken into account in the calculation of resources of a person claiming supplementary benefit in the same was as family allowances is at present.— [Vol. 912, cc. 284–97.]

Sir George Young

asked the Secretary of State for Social Services (1) what evidence he has for his statement that the introduction of child benefit in its original form would pose an unacceptable threat to the Government's pay policy;

(2) what representations he has received from the TUC about the child benefit scheme.

Mr. Ennals

In its Press statement yesterday the TUC General Council welcomed the Government's decision to extend benefit to the first child, while at the same time emphasising the need for the full Child Benefit Scheme to be introduced as early as practicable. I understand that in elucidation of this statement the General Secretary of the TUC also made it clear that, in judging the effects that full implementation of the scheme in a single operation in April 1977 would have had, the very substantial reductions involved for take-home pay had to be weighed against the very limited scope there would be for increases in gross pay in the coming period.

Sir George Young

asked the Secretary of State for Social Services how much abortive work has been carried out by his Department in preparation for the child benefit scheme.

Mr. Ennals

None.

Sir George Young

asked the Secretary of State for Social Services what is the impact of his statement on 25th May about child benefit on (a) families whose incomes are insufficient to benefit from child tax allowances and (b) families with incomes below the national average.

Mr. Ennals

Two-parent families whose incomes are insufficient to benefit from child tax allowances, other than those on social security benefits, will gain the full £1 payable for the first child from next April. Others with incomes below the national average not on social security benefits will gain 30p if they are paying tax, but some just below the level of their tax threshold will gain between 30p and £1, depending on how far below it they are.

Sir George Young

asked the Secretary of State for Social Services how much of the £95 million allocated for child benefit in April 1977 under his proposals announced on 25th May will go to families with below average incomes.

Mr. Ennals

I will let the hon. Gentlemen have a reply as soon as possible.

Sir George Young

asked the Secretary of State for Social Services when he will introduce an age-related child benefit.

Mr. Ennals

The future development of the child benefit scheme must depend on the availability of resources.

Sir George Young

asked the Secretary of State for Social Services at what level child benefit could have been introduced next year for children under 11 years of age if residual tax allowances for those over 11 years of age were retained and if £95 million were available to fund the benefit.

Mr. Ennals

£2.50 a child, if child tax allowances for children under 11 years of age were withdrawn, and those for older children reduced by a corresponding amount.

Sir George Young

asked the Secretary of State for Social Services whether standard rate taxpayers with one, two, three and four children, respectively, would be better or worse off if child benefit were introduced in April 1977 at a net cost of £95 million; and by how much.

Mr. Ennals

Under the arrangements I announced on 25th May—[Vol. 912, c. 284–97] —families paying tax at the basic rate other than those on social security benefits will be 30p better off irrespective of their size.

Sir George Young

asked the Secretary of State for Social Services when he now proposes to introduce a tax-free child benefit.

Mr. Ennals

The future development of the child benefit scheme must depend on the availability of resources.

Mr. Kenneth Clarke

asked the Secretary of State for Social Services what would be the net cost to public funds of introducing in April 1977 child benefit at the rate of £2.50 or £2.75 for each child and withdrawing family allowances and child tax allowances up to the level allowed for all children under the age of 11 years, whilst retaining the extra tax allowance at present allowed for children over the age of 11 years as a temporary residual child tax allowance.

Mr. Ennals

£95 million and £250 million a year respectively.

Mr. Kenneth Clarke

asked the Secretary of State for Social Services what Regulations, Orders or other measures will have to be laid before the House in order to implement the Government's proposals on child benefit; and when such measures will be placed before the House.

Mr. Ennals

Five sets of Regulations, one fixing the rates and four governing general administration, and two Orders dealing with commencement are required for child benefit. As I announced in my statement to the House on 25th May, we shall shortly be seeking an affirmative resolution for the Regulations fixing the rates; the other Regulations and the Orders will also be made shortly.—[Vol. 912, c. 284–97.]

Mr. Kenneth Clarke

asked the Secretary of State for Social Services whether he will ensure that the new benefit for first children to be introduced in April 1977 will be described officially as family allowance and not as child benefit.

Mr. Ennals

No. As from April 1977 the payments to mothers for child support will be made under the Child Benefit Act 1975.