Select Committee on Work and Pensions Written Evidence


APPENDIX 1

BACK TO WORK CALCULATIONS—APRIL 2006-07 FIGURES

Total income with work of four hours per week


Child Benefit
  29.15
Child Tax Credit
  78.26
Carer's Allowance
  46.95*
Housing Benefit
  73.33 (to cover full rent)
Council Tax Benefit
  21.00 (to cover full council tax liability)
Income Support
104.25
Earnings
  20.20**
DLA
  58.15
------------------------
431.29

  *  current earnings have no impact on Carer's Allowance, where limit was £84.

  **  only 20p of these earnings counts as income when income support is calculated, as £20 is ignored.

If client increases work to 15 hours per week


Child Benefit
  29.15
Child Tax Credit
  78.26
Carer's Allowance
  46.95
Housing Benefit
  73.33
Council Tax Benefit
  21.00
Income Support
  48.70
Earnings
  75.75
DLA
  58.15
------------------------
431.29 ie the same


  This is because any earnings in excess of £20 per week result in a £ for £ reduction in income support.

If client increases work to 16 hours per week


Child Benefit
  29.15
Child Tax Credit
  78.26
Working Tax Credit
  63.49
Carer's Allowance
  46.95
Housing Benefit
  70.12
Council Tax Benefit
  20.02
Earnings
  80.80
DLA
  58.15
------------------------
446.94 ie £15.65 higher for 12 extra hours of work compared to the carer working four hours per week


  At 16 hours per week, entitlement to income support stops, irrespective of earnings. WTC becomes payable but client loses free school meals for children.

If client increases work to 20 hours


Child Benefit
  29.15
Child Tax Credit
  78.26
Working Tax Credit
  63.49
Housing Benefit
  70.96
Council Tax Benefit
  20.27
Earnings (net)
100.12
DLA
  58.15
------------------------
420.40 ie £10.89 lower than when the carer works four hours per week


  At 20 hours per week, the earnings mean that Carer's Allowance and carer premium is no longer payable. WTC becomes payable but client loses free school meals for children.

4 April 2007



 
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