§ Mr. Meacherasked the Chancellor of the Exchequer what has been the total expenditure on, respectively, unemployment benefit, supplementary benefit for the unemployed, loss of income tax as a result of unemployment, loss of national insurance contributions from unemployment, the estimated loss of VAT revenues from unemployment for each year since 1970, at current prices and at 1980 constant prices.
§ Mr. BrittanWhilst estimates for total expenditure on unemployment benefit and supplementary benefit for the unemployed are available, and are given in the following table, accurate estimates of the loss of income tax, national insurance contributions and VAT payments due to unemployment cannot be made. Any large-scale change in unemployment would be associated with other developments in the economy which would themselves affect tax and national insurance receipts, and the overall impact would depend on the cause and timing of the change in unemployment.
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Expenditure on Unemployment Benefit and Supplementary Benefit to the Unemployed 1980 Survey Prices* Current Prices Financial Year Unemployment Benefit Supplementary Benefit to the Unemployed Unemployment Benefit Supplementary Benefit to the Unemployed £ million £ million £ million £ million 1970–71 469 275 150 88 1971–72 684 424 239 148 1972–73 559 487 209 182 1973–74 421 385 174 159 1974–75 440 390 214 190 1975–76 745 635 454 387 1976–77 790 840 559 594 1977–78 780 920 629 742 1978–79 730 810 632 701 1979–80 653 766 653 766 1980–81† 1,010 1,060 1,176 1,235 * 1980 survey prices are average 1979–80 current prices. † Estimated outturn.
§ Mr. Cookasked the Chancellor of the Exchequer what is his estimate of the total loss from reduction in tax and national insurance contributions arising from unemployment in the financial year 1979–80.
§ Mr. Brittan[pursuant to his reply, 16 February 1981, c. 47]: Whilst a lower level of unemployment in the financial year 1979-80 would have been associated with higher payments of tax and national insurance contributions, it is not possible to provide an accurate estimate of the total loss of revenue from unemployment. As the article in February's Economic Progress Report on the costs of unemployment makes clear, estimates of a marginal change in unemployment cannot be grossed up to provide estimates of the cost of all those unemployed at a particular time. Any large-scale change in unemployment would be associated with other developments in the economy, which would make such calculations invalid.