§ Mr. Malcolm BruceTo ask the Chancellor of the Exchequer what plans he has to improve work incentives by tackling high marginal deduction rates resulting from housing support mechanisms; and if he will make a statement. [36377]
§ Dawn Primarolo[holding answer 30 March 1998]: The Budget tackled high marginal reduction rates faced by people receiving Housing Benefit and Council Tax Benefit in two ways. First, it will change disregards so as to remove instances where people could be worse off if they increased their earnings. Second, the Working Families Tax Credit will mean that 50 thousand families will no longer face penal marginal rates as a result of being on both the WFTC taper and Housing Benefit taper. And all people on the Family Credit taper will find that their return from working increases by one half: half a million families will see the return from increase in their earnings rise by one-half.