Dáil Éireann debate -
Tuesday, 8 Dec 1998

Vol. 498 No. 1

Written Answers. - Income Levels.

Paul McGrath

Question:

226 Mr. McGrath asked the Minister for Finance the net take home weekly pay for a widow or widower with three school going children who is in receipt of a contributory pension and varying amounts of income (details supplied); and the improvements that would ensue from the budgetary announcements in this regard. [26851/98]

Minister for Finance (Mr. McCreevy)

The following schedule sets out the increase in weekly income for a widowed parent with three school going children, taking account of the income tax changes and social welfare increases announced in budget 1999. The numbers have been prepared on the assumption that the widowed parent is under 66 years of age and has ceased to be eligible for the widows bereavement allowance, i.e the spouse of the widow-widower died more than five years previously.

The gains in weekly net income at each of the income levels referred to in the question are around £13; approximately £10 of this increase is as a result of income tax changes and the remainder arises from the increase to the contributory pension. The increases in child benefit announced in the budget will add a further £2.30 to net weekly income. I noted in my budget speech last week that the move to tax credits is particularly complex for widows and widowed parents. The existing allowances for widows (£500), widowed parents (£2,650) and lone parents (£3,150) will continue to be granted at the marginal rate. This will ensure that widows and widowed and single parents paying tax at the higher rate do not lose from the move to standard rating. I have also provided for an increase of £1,050 at the standard rate in the allowances for widowed parents and single parents, which will provide additional benefits from the budget 1999 for these groups, in addition to those they will receive as ordinary taxpayers.

Budget 1999 Changes in Net Income for Widowed Parent with Contributory Pension and Various Levels of Additional Income.

Annual Income (pre and post Budget)	Weekly Income (pre and post Budget)	Weekly Take-Home Income (pre-Budget)	Weekly Take-Home Income (post-Budget)	Net Gain
1. £6,505/£6,661	£125.10/£128.10	£125.10	£128.10	£3.00
2. £11,505/£11,661	£221.25/£224.25	£200.92	£213.81	£12.89
3. £16,505/£16,661	£317.40/£320.40	£269.84	£282.74	£12.90
4. £23,505/£23,661	£452.02/£455.02	£339.00	£351.44	£12.44
5. £31,505/£31,661	£605.87/£608.87	£415.16	£427.61	£12.45

1. Widow with contributory pension and 3 school going children and no additional income;

2. As 1. above with £5,000 gross annual income from work;

3. As 1. above with £10,000 gross annual income from work;

4. As 1. above with £17,000 gross annual income from work; and

5. As 1. above with £25,000 gross annual income from work.

Notes to above table:

Widows Pension entitlement:

Pre-Budget: £74.10 per week plus £17 per week in respect of each additional child = £125.10 per week.

Post Budget: £77.10 per week plus £17 per week in respect of each additional child = £128.10 per week.

Child Benefit: The above table does not take account of Child Benefit. The increases in child benefit announced in the budget will increase weekly net income by £2.30 in each case.