Family Allowances

Oral Answers to Questions — Social Security – in the House of Commons at 12:00 am on 15th July 1968.

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Photo of Mr Tim Fortescue Mr Tim Fortescue , Liverpool, Garston 12:00 am, 15th July 1968

asked the Minister of Social Security for what sociological reasons the increase in family allowances for 1968–69 was arranged so that, when taken in conjunction with reduced Income Tax allowances, they leave married men with four or five children worse off than before at gross earnings of only £1,336 and £1,452 per year, resepectively.

Photo of Mr Charles Loughlin Mr Charles Loughlin , Gloucestershire West

The object of the tax changes is to restrict the benefit of the family allowances increases to those who most need them. The families quoted received a small additional net benefit in the last six months of 1967-68. Otherwise they will get the same net benefit this year as in previous years.

Mr. Fortescoe:

Can the hon. Gentleman assure the House that this apparent discrimination against the large family in no way reflects the strictures, made in a speech sponsored by the London Rubber Company, against the pro-creational proclivities of the British people, by his right hon. Friend the Member for Sowerby (Mr. Houghton).

Photo of Mr Charles Loughlin Mr Charles Loughlin , Gloucestershire West

I can assure the hon. Gentleman that there is no relationship between my Answer and the speech of my right hon. Friend. I make it absolutely clear that there is no restriction on these families as he says. With all the tax and family allowance changes together, these families will receive in total the same amount by the end of October this year as they received at the end of October last year.

Photo of Mr William Griffiths Mr William Griffiths , Manchester Exchange

Is my hon. Friend aware that in my constituency there is a married man with three children, who is a weaver earning £18 a week, who claims that the whole of the increase in family allowances has been eliminated by tax changes? Is he aware that I have had other cases at similar wage levels when it has been said that more than the family allowance has been taken by Income Tax?

Photo of Mr Charles Loughlin Mr Charles Loughlin , Gloucestershire West

My hon. Friend ought to let us have details of these cases, because one has to be careful about these things. I can give the definite assurance that the tax total on the family allowances pre the 7s. and 3s. increases, added to that which has to be paid in consequence of the give and take, result in no additional taxation to these families.

Photo of Mr Tim Fortescue Mr Tim Fortescue , Liverpool, Garston

asked the Minister of Social Security what is her estimate of the number of families with four children or more who will have lower incomes in 1968–69 than in 1967–68 as a result of increased family allowances and reduced Income Tax allowances.

Photo of Mr Charles Loughlin Mr Charles Loughlin , Gloucestershire West

The Board of Inland Revenue estimate that about 300,000 families will be affected.

Photo of Mr Tim Fortescue Mr Tim Fortescue , Liverpool, Garston

Does the hon. Gentleman realise that this is a very serious number of families? Does he still stick to his previous statement that all these 300,000 families will be no worse off in 1968–69 than they were in 1967–68.

Photo of Mr Charles Loughlin Mr Charles Loughlin , Gloucestershire West

I can only assure the hon. Gentleman that these questions should be put to the Chancellor of the Exchequer—[HON. MEMBERS: "Oh."] Obviously, the Inland Revenue is a matter for the Chancellor

Photo of Mr Tim Fortescue Mr Tim Fortescue , Liverpool, Garston

Why did you not transfer the Question, then?

Photo of Mr Charles Loughlin Mr Charles Loughlin , Gloucestershire West

The hon. Gentleman put it down to us. The difficulty is that if we transfer the scream goes up, "Why did you tranfer?"—

Photo of Dr Horace King Dr Horace King , Southampton, Itchen

Order. We have many Questions before us.

Photo of Mr Charles Loughlin Mr Charles Loughlin , Gloucestershire West

But I must answer the Question if it is put to me, Mr. Speaker. Anyway, I suggest that the hon. Gentle- man now puts the Question to the Chancellor.

Photo of Miss Irene Ward Miss Irene Ward , Tynemouth

On a point of order. Could you ask, Mr. Speaker, whether the House could be told now whether we can choose to which Ministers we put our Questions, since it would be most convenient to the House if we could put all Questions to the Chancellor of the Exchequer?

Photo of Dr Horace King Dr Horace King , Southampton, Itchen

That is a consummation devoutly to be wished.

Photo of Mr John Pardoe Mr John Pardoe , North Cornwall

I hope that everyone is not quite as confused by the Parliamentary Secretary's answers as I am He said that 300,000 families will have lower incomes as a result of these changes. Is that right? Are we to understand that, as a result of these changes, these people will have lower incomes in 1968-69 than they had in 1967–68? Will the hon. Gentleman tell us why there has been no liaison with the Chancellor of the Exchequer over this?

Photo of Mr Charles Loughlin Mr Charles Loughlin , Gloucestershire West

I do not know why the hon. Gentleman is getting excited about this. He must realise that when we are talking about the offsets, that is, the give-and-take principle of family allowances and the Inland Revenue, we are talking about those families who are paying up to standard rate Income Tax. It is the families over that level who will be affected, and they are the 300,000 referred to in the second Question.

Photo of Lord  Balniel Lord Balniel , Hertford

Is the hon. Gentleman aware that we are absolutely certain that there are families with four or five children who are worse off as a result of the changes being made this year? Is this an accident, or is it on purpose? If it is an accident, will he correct it?

Photo of Mr Charles Loughlin Mr Charles Loughlin , Gloucestershire West

Let me make it clear that up to the standard rate of Income Tax payment families will not this year be worse off. If one takes a global position in relation to family allowances as a whole, the 300,000 families to which I referred are those in the higher tax bracket than the standard rate.

Photo of Mr Frank Hooley Mr Frank Hooley , Sheffield, Heeley

Would not hon. Friend not agree that it is very strange that hon. Members opposite should clamour for selectivity but object strongly when it is applied to the higher income scale?