Package helps those most affected by rise in food and energy prices

22 October 2008

Last month, the States decided to allocate £5.8 million to help protect lower and middle income families from the impact of recent increases in food and fuel costs.

Working with the Treasury and Resources Minister, the Social Security Minister has assembled a package to improve and increase Income Support payments with effect from 1 February 2009 and to double the GST Bonus payment in 2009. Of the £5.8 million, the overall Social Security package is worth £3.4 million a year with the remaining £2.4 million covering the increases to income tax thresholds.

The main elements of the proposed Social Security package are as follows:

• improving work incentives so that for every pound earned, an individual will now retain 10p instead of the current 6p
• increasing the level of benefit for those on Income Support by increasing the basic components for all adults and children
• increasing the pension income disregard for single pensioners by around £5 a week and by just under £8 a week for a pensioner couple
• increasing the value of the 2009 GST Bonus to £150 per household and paying it from March next year.
  

Other improvements ensure that all Income Support claimants, especially those who are disabled or have a long-term illness that prevents them from working, would see an increase in the level of benefit they receive.

Welcoming the proposals, Senator Paul Routier, the Social Security Minister, said: ‘I realise that the recent increases in the cost of food and fuel have placed greater pressure on household budgets for the less well-off. These moves are intended to help alleviate this rise in costs for all those receiving Income Support.

It has always been the intention to improve work incentives within Income Support and, under this package, anyone working will now be able to retain more of their income, while still qualifying for Income Support. This is a change I have been keen to make for some time and I am pleased that the financial resources have now been made available for this to be implemented.’ 


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