Child Benefit and Child and Working Tax Credit rates

Child Benefit is raised in line with inflation. From April 2009, there will be additional support for all families, with every mother-to-be becoming eligible for Child Benefit from week 29 of her pregnancy, so that women will be up to £200 better off.

The child element of Child Tax Credit (CTC) increases in line with average earnings. The disabled child element and severely disabled elements rise with inflation. The family element (normal and baby addition) remains frozen at £545 per year. The income threshold for CTC only rises to £14,495 per year. The income threshold for the CTC family element only remains at £50,000 per year.

The maximum eligible childcare costs remains at £175 for one child and £300 for two or more children. The percentage of eligible childcare costs remains at 80%.

The disregard in Tax Credits for increases in income between one tax year and the next remains at £25,000.

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From April 2007, the basic state pension for a single person will rise to £87.30. The Government has also committed to uprating the basic state pension by earnings in the longer term.

There will also be an extension of the Warm Front home energy efficiency programme, targeting 300,000 of the most vulnerable pensioner and other households, community by community.

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Other Benefits

The Pre-Budget Report describes the further steps the Government is taking towards its goal of employment opportunity for all:

  • extending the support offered to lone parents who move into work by maintaining the In-Work Credit in the current pilot areas for a further six months
  • improving the Jobseeker's Allowance intervention regime by offering expert work-search support at the new claim stage, and extending the Job Grant of £100 (£250 to claimants with children) to 18-24 year old jobseekers
  • providing funding to improve the administration of Housing Benefit and to raise awareness that Housing Benefit is available to those in work
  • taking forward measures to simplify and reduce error in the benefits system
  • raising the earnings disregard to Housing Benefit and Council Tax Benefit in line with indexation to £15.45 in April 2007, ensuring that claimants gain from increases in the rate of Working Tax Credits.

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