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Benefits: Deflation

Volume 711: debated on Monday 1 June 2009


Asked by

To ask Her Majesty's Government further to the Written Answer by Lord McKenzie of Luton on 5 May (WA 105), by what date deflation-proofing legislation would need to be commenced to enable any deflationary movement in the retail prices, Rossi and average earnings indices of September 2009 to be taken account of in the rating of benefits in April 2010; and what preparations they have made for any downrating. [HL3626]

In the 2009 Budget the Chancellor made the following commitment:

“the Government will at least maintain the cash value of all benefits, tax credits and personal tax allowances and thresholds in April 2010, despite the expectation RPI inflation will be negative in September this year”.

The existing legislation already allows for this.