§ Mr. Kaufmanasked the Chancellor of the Exchequer (1) consequent upon his statements, Official Report, 12 June, columns 261–2, that as a result of his Budget a married couple with a husband earning £100 a week would be £1.30 a week better off, a couple with a husband earning £60 a week would be 75p better off, and a couple with a husband earning £150 a week would be nearly £2 a week better off, if he will now state the net gain or loss for each of these couples taking into account the factors involved in his original calculation, together with all price rises that have taken place since then, and in addition, the forthcoming increase in mortgage rates, assuming that those couples would each be buying an average two-bedroomed house;
(2) consequent upon his statements, Official Report, 12 June, columns 261–2, that as a result of his Budget a married couple with a husband earning £100 a week would be £1.30 a week better off, 227W a couple with a husband earning £60 a week would be 75p better off, and a couple with a husband earning £150 a week would be nearly £2 a week better off, if he will now state the net gain or loss for each of these couples taking into account the factors involved in his original calculation, together with all price rises that have taken place since then, and in addition, increase in mortgage rates to 14 per cent., assuming that those couples would each be buying an average two-bedroomed house.
§ Mr. Peter Rees[pursuant to his replies, 16 November 1979, c. 818, and 20 November 1979]: The illustrative figures in my right hon. and learned Friend's Budget Statement showed the effect of the Budget tax measures on the purchasing power of the incomes after tax and NICs of married couples where the husband earns the amount stated. The households remain better off by these amounts than they would otherwise have been even though prices have risen since the Budget. The price rises due to the Budget increases in indirect taxes are already included in the figures in the speech. Other price rises are not a consequence of the Budget, and so it would be inappropriate to offset them against the Budget tax measures. The right hon. Member will also appreciate that it would be inappropriate in any case to take account of price rises since the Budget without also taking account of increases in earnings.
As regards the increase in the mortgage rate, no allowance for mortgage interest is assumed in the original figures, so
228W
Full year cost of main Budget changes Full year cost of changes in April Finance Act Full year cost of main Budget changes excluding changes in April Finance Act Range of total income in 1979–80 Value Per cent. Average per tax unit* Value Per cent. Average per tax unit* Value Per cent. Average per tax unit* £ million £ £ million £ £ million £ Below £2,000 100 2 45 50 5 24 50 1 21 £2,000–£4,000 630 14 95 240 24 37 390 11 58 £4,000–£5,000 460 10 154 150 14 50 310 9 104 £5,000–£6,000 510 11 179 140 13 48 370 10 131 £6,000–£8,000 860 19 219 220 21 57 640 18 162 £8,000–£10,000 490 11 285 110 10 63 380 10 222 £10,000–£15,000 570 12 492 80 8 72 490 14 420 £15,000–£20,000 300 6 952 30 3 79 270 8 873 Over £20,000 690 15 3,850 20 2 100 670 19 3,750 4,610 100 210 1,040 100 47 3,570 100 163 * Tax units count married couples as one. again it would be inappropriate to allow for the increase in the mortgage rate. In any case, people buying houses, even identical houses, will be very differently affected according to how many years into their mortgage they are, and whether they choose to pay more each month or extend the term of the mortgage. For these reasons, it is not very meaningful to take account of mortgage interest in this type of sum.