§ Sir Brandon Rhys Williamsasked the Secretary of State for Social Services if he will estimate the saving in a full year due to the fact that family credit and housing benefit will be means-tested rather than income tested; whether this figure will represent a real reduction in the total value of privately owned capital of the same amount; and how many persons will be affected.
§ Mr. PortilloI assume my hon. Friend is referring to the introduction of a capital cut-off of £6,000, and a notional tariff income for those with capital of between £3,000 and £6,000, into the family credit and reformed housing benefit schemes next April. We estimate that approximately £80 million will be saved, almost entirely from housing benefit as a result of treating capital in this way rather than taking into account the actual income it generates as happens at present.
What effect the changes have on the total value of privately owned capital will depend on the individual behaviour of those affected. On the basis of information about income from capital in recent family expenditure surveys, which may not be wholly reliable, we estimate that some 2 million households will be affected in some way by the changes. This figure, which again mainly represents housing benefit recipients, includes those with smaller amounts of capital which will, of course, be treated more favourably under the new rules.
§ Sir Brandon Rhys Williamsasked the Secretary of State for Social Services if he will publish figures showing the change in the number of families with children that would be entitled to family credit and to housing benefit in 1988–89 if child benefit (a) is increased in line with current earnings, (b) is increased in line with the Lawson-Rooker-Wise formula, or (c) remains at its present figure.
§ Mr. ScottIt is estimated that(a) about 10,000 more families with children would be entitled to family credit than would have been the case if child benefit was increased in line with the movement in the retail prices index in the year ending September 1987, and (b) over 15,000 more families with children would be entitled to family credit than would have been the case if child benefit was increased in line with the increase in earnings over the same period.
In housing benefit, it is estimated that very few more families with children would be entitled to housing benefit than if child benefit was increased under either of the other two formulae.