As a first step towards alleviating the sharp poverty trap associated with the complete withdrawal of the qualified adult allowance once the earnings of the spouse or partner of the social welfare claimant exceeded £60 per week, regulations were introduced in November 1997 which provide for the tapered withdrawal of the qualified adult allowance for people claiming unemployment benefit, unemployment assistance, disability benefit, disability allowance, pre-retirement allowance, injury benefit and unemployability supplement. These were the categories of welfare claimants most affected by the previous arrangements. The revised arrangements do not apply to any other welfare payments.
Under the revised arrangements, where the spouse or partner is earning between £60 and £90, a reduced rate qualified adult allowance continues to be payable. In the 1999 budget, provision has been made to extend the upper limit of the income range from £90 to £105, with effect from next October, to further enhance the incentive for people to avail of employment opportunities.
It has not been possible to prepare estimates of the cost of extending these arrangements to old age pensioners, and to other categories not currently covered, in the time available. It should be noted, however, that in the case of the old age non-contributory pension and the blind person's pension, the means test which applies to these schemes ensures that, in practice, the qualified adult allowance is withdrawn on a progressive basis where the spouse or partner of the claimant has income from employment.
Consideration will be given to extending the arrangements governing the tapered withdrawal of the qualified adult allowance to cover other categories of welfare claimants. It will not, however, be possible to make any such provision in the forthcoming Social Welfare Bill.