Full-rate child dependant allowance – CDA – is payable where the claimant is in receipt of an allowance for a qualified adult, has no spouse or partner or is separated. Where a qualified adult allowance is not payable by virtue of the fact that the spouse or partner is not wholly or mainly maintained by the claimant, CDA is payable at half-rate. Regulations specify the circumstances in which a person may be regarded to be wholly or mainly maintaining another person for the purposes of entitlement to qualified adult allowance – QAA. The spouse or partner can earn up to £70 per week and the claimant can retain the full relevant rate of QAA. Where the spouse or partner has income of over £70 per week, the QAA is withdrawn on a tapered basis until earnings reach £145 per week. However, the 50% reduction of the CDA does not take effect until the spouse or partner's income exceeds £145 per week. Where the spouse or partner is claiming a social welfare payment in his/her own right, a CDA is payable at half-rate in respect of each child to both the claimant and his/her partner.
The policy direction of successive Governments has been to concentrate resources for child income support on child benefit, rather than increasing CDAs, thus ensuring that the supports provided by the State are more neutral vis-à-vis the employment status of the parent(s). This policy was given new impetus in this year's Budget. The increases that came into effect this month constitute a full year investment of £330 million in the child benefit scheme. Most notably, this is only the first of three years of increases which will see investment in the payment rise by £1 billion by 2003. That is almost a three fold increase. By the end of this period, the higher rate of child benefit will be £146 per month and the lower rate will be £117.50. A family with four children will, in 2003, be receiving £120 per week in child benefit. The relative importance of CDAs will clearly decline in the years ahead. In the circumstances, I have no plans to provide for full rate CDAs for the group referred to by the Deputy who I believe are already adequately catered for by the arrangements I have outlined.