News

BUDGET 2013: Steve Outlines Cuts Timetable

(March 19, 2013)

Steve 2013 Headshot

As the Chancellor prepares to announce the budget, Steve wanted to give everyone in Liverpool Walton a chance to see for themsleves the timetable for George Osborne's cuts that will affect Walton's working people and families: 

Date

Cut / Change

+ Gain £

- Loss £

Who’s Affected

January 2011

VAT increased by 2.5% to 20%

 

Average

- 307

Average households pay £307 more

Average for those with children is £450

Child Trust Fund abolished

 

- 250

Babies born after 1/1/11 have no Child Trust Fund

Education Maintenance Allowance abolished

 

Up to

- 1,170

Young people in England in Further Ed with household income less than £32400

April 2011

Tax allowance increased by £1,000 (£700 over RPI x20%)

0 to

+ 140

 

All basic rate taxpayers earning over £6,700 gain

NIC threshold & NIC rate increased

0 to

+ 120

0 to

- 200

Employees on less than £20,000 gain, higher earners lose out

Child Tax Credit increased by £255 (£150 above 4.6% RPI)

0 to +150 per child

 

Families gain by no. of children x £150, tapered at 41% of income over threshold

Working Tax Credit frozen, basic and 30 hour elements

 

- 90 or

- 125

Low wage earners working under 30 hr

Low wage earners working over 30 hrs

Increase Tax Credit claw-back (taper) by 2% to 41%

 

Average

- 160

Households lose up to 2% of tax credits

Usual loss = (Income less £6420) x 2%

Couples/lone parent element of WTC rose by CPI, not RPI

 

- 25

All low-middle earning couples and lone parents claiming Working Tax Credit

Baby element of Child Tax Credits abolished

 

- 545

Families with new babies or babies under 1 in April 2011

Family element of Tax Credit abolished for higher earners

 

- 545

Families with income between £41,000 and £58,000

Child Benefit frozen

 

- 49 and

- 32

For first child up to 16 or 19 if in FT Ed

Also - £32 for each other child

Childcare Tax Credit reduced from 80% to 70%

 

Up to

- 1,560

Families claiming CTC lose 10% of childcare cost. Average = £457 per child

Sure Start Maternity Grant abolished for 2nd + babies

 

- 500

Lower income families having 2nd or subsequent baby

Health in Pregnancy Grant abolished

 

- 190

Babies due after mid April 2011

Benefits to rise by CPI, not RPI

 

- 50

Households lose out by around 1% of all benefits - around £50

October 2011

Local Housing Allowance rates capped

 

Average

- 468

Capped at 30th percentile of local rents.  40% of claimants are in low-paid work.

April 2012

Increase tax allowance by £630 (£250 over RPI x 20%)

0 to

+£190

 

All basic rate taxpayers earning over £7,850 gain

Child Tax Credit rises by CPI, but previous increase applies

0 to +150

per child

 

Families gain by no. of children x £150, tapered at 41% of income over threshold

Family element of Tax Credit abolished for middle earners

 

- 545

Lost if income is over £25,000 (1 child)/ £32500 (2 children)/£39000 (3 children)

50+ element of Tax Credits abolished

 

-1,320 or

- 1,965

People working 16 – 29 hours pw

People working over 30 hours pw

Couples’ Working Tax Credit based on 24 not 16 hrs pw

 

Potential

- 3,870

Couples with children unable to increase hours of work to 24 pw lose all WTC

Working Tax Credit frozen

Basic & 30 hour elements

 

- 205 or

- 285

Low wage earners working under 30 hr

Low wage earners working over 30 hrs

Working Tax Credit frozen:

Couples/lone parent element

 

- 135

All low-middle earning couples and lone parents claiming Working Tax Credit

Child Benefit frozen

 

- 112 and

- 73

For first child up to 16 or 19 if in FT Ed

Also - £73 for each other child

Benefits & tax credits to rise by CPI, not RPI

 

- 100

Households lose out by around 2% of all benefits – around £100                                

Date

Cut / Change

+ Gain £

- Loss £

Who’s Affected

April 2013

 

 

 

Increase tax allowance by £1335 (£1125 over RPIx20%)

0 to

+ 420

 

All basic rate taxpayers earning over £8,105 gain

Child Tax Credit capped at 1% - limits previous increase

0 to +110

per child

 

Families gain by no. of children x £110, tapered at 41% of income over threshold

Child Benefit frozen

 

- 143 and

- 94

For first child up to 16 or 19 if in FT Ed

Also - £94 for each other child

Child Benefit abolished for higher rate taxpayers

 

-1,055 &

- 697

Households on over £50,000 lose up to £1055 for 1st child, & £697 for each other

Working Tax Credit frozen:

Basic and 30 hour elements

 

- 260 or

- 365

People working under 30 hours

People working over 30 hours

Working Tax Credit: Couples/

Lone Parent part rises by 1%

 

- 170

All couples and lone parents on Working Tax Credit lose out

Bedroom Tax - 14% or 25% of Housing Benefit

 

- 624 or

- 1,144

540,000 households - 1 spare bedroom

120,000 households - 2 spare bedrooms

Council Tax Benefit cut

 

 

Up to - 250

Up to - 600

Up to 2.5m recipients not in employment

Almost 700,000 recipients in employment

DLA changed to Personal Independence Payments

 

Average

- 2,480

IA says 500,000 will cease to qualify for support, saving £1.24bn by 2015/16

Benefit Cap (in 4 Councils, nationwide from September)

 

Average

- 4,836

56,000 households will have their benefit reduced by an average £93 per week

Benefits & tax credits to rise by CPI, not RPI

 

Up to

- 150

Households lose out by around 3% of all benefits - up to around £150

Localisation of the Social Fund

 

Loss of Safety Net

Community Care Grants & Crisis Loans abolished. No ring-fenced funding devolved to Councils.

October 2013

Universal Credit: marginal deduction rate rises to 76%

Average

+ 2,016

Average

- 1,644

3.1m will gain on average £168pm

2.8m will lose an average £137pm

April 2014

Child Tax Credit capped at 1% (reduces the 2011 rise)

0 to + 65

per child

 

Families gain by no. of children x £65, tapered at 41% of income over threshold

Working Tax Credit increases capped at 1% (after freeze)

 

- 295

- 415

People working under 30 hours

People working over 30 hours

Working Tax Credit: Couples/

Lone Parent part rises by 1%

 

- 205

All couples and lone parents on Working Tax Credit lose out

Child Benefit increases capped at 1% (after freeze)

 

- 162 and

- 107

£162 less for the first child

£107 less for each subsequent child

April 2015

Child Tax Credit capped at 1% (reduces the 2011 rise)

0 to + 5

per child

 

Families gain by no. of children x £5, tapered at 41% of income over threshold

Working Tax Credit increases capped at 1% (after freeze)

 

- 345

- 485

People working under 30 hours

People working over 30 hours

Working Tax Credit: Couples/

Lone Parent part rises by 1%

 

- 255

All couples and lone parents on Working Tax Credit lose out

Child Benefit increases capped at 1% (after freeze)

 

- £189 and

- £124

£189 less for the first child

£124 less for each subsequent child

 

Note

Where support payments have been frozen or capped, or increased in excess of inflation, the gain or loss has been calculated in comparison to cumulative increases by RPI, which was used to increase tax and benefit payments prior to 2010.

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