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Household Income

Treasury written question – answered on 11th July 2001.

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Photo of Karen Buck Karen Buck Labour, Regent's Park and Kensington North

To ask the Chancellor of the Exchequer if he will estimate the impact on the incomes of (a) lone parent families and (b) couples with children in each income decile, resulting from an increase in the threshold level of income at which Working Families Tax Credit starts to be withdrawn to (a) £120, (b) £150 and (c) £200.

Photo of Dawn Primarolo Dawn Primarolo Paymaster General (HM Treasury)

The estimated percentage increases in income are shown in the following table. Each row of the table covers families in households in the decile group defined by the ranking of all households by equivalised net income before housing costs. The percentage increases shown are of the total net income of all families of that type and in that decile group.

Percentage
Equivalised Lone parents Couples with children
income Income threshold raised to: Income threshold raised to:
decile group of households (a) £120 (b) £150 (c) £200 (a) £120 (b) £150 (c) £200
Bottom 0 0 0 0 1 1
2 0 0 0 2 4 6
3 1 1 1 3 7 13
4 2 3 4 2 5 11
5 3 6 9 0 1 4
6 3 6 11 0 0 1
7 2 4 8 0 0 0
8 1 2 4 0 0 0
9 and top 0 1 1 0 0 0

Notes:

The estimates are based on the 1999–2000 Family Resources Survey with incomes projected forward to 2001–02. The decile groups are of all households ranked by net income before housing costs (including WFTC with the current threshold of £92.90) equivalised using the McClements scale. The percentage increases are of net family incomes (not equivalised). The sample sizes are too small to yield reliable separate estimates for lone parents in the top two decile groups.

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