Select Committee on Social Security Second Report


A brief description of the benefit

6.1  Family Credit was created in April 1988 to replace the earlier Family Income Supplement. It is a weekly, income-related, tax free benefit intended to help low-income families. At least one parent must be working for a minimum of 16 hours a week and there must be at least one child or young person in the household (a "young person" is one aged over 16 but under 19 and in full time non-advanced education).

6.2  The main factors determining how much FAMC a customer receives are the family's income and savings and the number and ages of the children in the family. Customers claim either as a couple or as a single parent. In claims from couples it is the woman who always makes the claim, even if her partner is working and she is not. People can claim FAMC whether they are self-employed or work for an employer.

6.3  FAMC is a fully centralised benefit, being administered solely by the FAMC Unit at Preston. Customers wishing to claim FAMC complete a postal claim pack in which they state details of their family composition, savings, earnings and other income and certain allowable expenses. These are sent to the FAMC Unit where the award is decided. Once an award is made it remains in payment for 26 weeks and is not affected by changes in a customer's circumstances (with five exceptions). At around the 26 week point the customer can submit a renewal claim.

6.4  The following changes in circumstances are reportable:

  • Death of a lone parent customer
  • The award ceases and is not transferable to another person

  • Death of both customer and partner

    As above

  • Child or young person leaves the household and either claims benefit in their own right or someone else claims benefit for them
  • From the date of change that child or young person is no longer treated as part of the assessment unit

  • Young person leaves full-time education and there are no remaining children or young persons in the household
  • If, from the date of change, there are no longer any children or young people in the household who are engaged in full-time education, the customer ceases to qualify for FAMC

  • Change of address
  • Benefit is not affected.

    previous page contents next page

    House of Commons home page Parliament home page House of Lords home page search page enquiries

    © Parliamentary copyright 1999
    Prepared 4 February 1999