BUILDING A FAIRER SOCIETY

A Budget to ensure that everyone has the opportunity to share in
rising prosperity, was set out by Chancellor Gordon Brown today.

Budget 99 will help build a fairer society by increasing support for
families with children, introducing a new #1 billion package for
pensioners, and ensuring that everyone has access to high quality
public services. It will help to make sure that economic growth takes
place in a way that is fair to today's and future generations by
protecting the environment.

A BUDGET FOR FAMILIES AND CHILDREN

Budget 99 delivers the lowest tax burden on a family with two
children on average earnings since 1972. On average, families will be
#740 a year better off from the measures in this Budget and the last.
The new measures include:

-    A new Children's Tax Credit worth #416 a year off the tax bill,
      which will take effect from April 2001. This will replace the
      married couple's allowance for people aged under-65 and related
      allowances, which will end in April 2000. The new credit will
      be tapered away from families where one or both partners is a
      higher rate taxpayer.

-    A 3 per cent real increase in Child Benefit from April 2000 to
      #15 for the first child and #10 for subsequent children. This
      is in addition to the #2.95 increase for the eldest child
      announced in the last Budget, which takes effect from April
      1999.

-    Increases to the new Working Families Tax Credit (WFTC) of
      #2.50 per week to the basic credit and #4.70 to the credit for
      under-11s from October 1999, with a further increase of #1.10
      in April 2000. This will significantly boost the incomes of 1.4
      million low-income working families and provide a minimum
      income guarantee for a family with someone in full-time work of
      #200 a week from October 1999. It will ensure that no family
      will pay net income tax until their income exceeds #235 a week.

-    Extra help for the poorest families with young children, with
      an increase in the under-11 credits in income-related benefits
      (including Income Support and Jobseeker's Allowance) of #4.70
      from October 1999 and a further #1.05 in April 2000. Along with
      the increases in WFTC, this will redress the imbalance in
      support between older and younger children for low-income
      families.

-    A new Sure Start Maternity Grant to replace the increasingly
      inadequate Social Fund maternity payment with the payment for
      each child doubled from #100 to #200. This increase will
      benefit 200,000 families each year and will be linked to their
      responsibilities for their child.

-    Extending entitlement to maternity allowance to women earning
      at least #30 a week. This will mean that for the first time the
      majority of pregnant working women can feel able to take
      adequate time off following childbirth. Research shows that
      improvements in UK maternity provisions have been crucial in
      reducing the financial penalties of motherhood.

Overall effects on children

The increased investment for families with children provided by this
Budget and the last is shown in figure 1 below.

- Families with children with a full-time earner will be
guaranteed a minimum income of #200 a week.

-    A one-earner couple with two children on average earnings of
      #20,000 will be #460 a year better off. Their tax burden will
      fall below 20 per cent for the first time since 1979 and be at
      its lowest level since 1972.

Figure 1

(TABLE NOT SUITABLE FOR CONVERSION)

A BUDGET FOR PENSIONERS

A package of measures for pensioners worth #1 billion every year was
announced by Chancellor Gordon Brown today. This package includes:

-    A fivefold increase in the winter allowance from #20 to #100.
      This increase helps every pensioner household, ensuring that
      the Government fulfills its commitment to support for
      pensioners.

-    A commitment to uprate the Minimum Income Guarantee by earnings
      rather than prices in April 2000. The increase in the Guarantee
      - currently equivalent to #75 a week for single pensioners and
      #116.60 for married pensioners aged between 60 and 74 (with
      higher rates for older pensioners) gives another real boost to
      the incomes of poorer pensioners

-    The introduction of the Minimum Tax Guarantee. Age-related
      income tax personal allowances will be increased by up to #200
      over indexation. This will mean that no pensioner aged between
      65 and 74 with income of #110 per week or less will pay income
      tax. For those aged 75 or more, no pensioner with income of
      #115 per week or less will pay income tax. And although the
      married couple's allowance is to be abolished from April 2000,
      the position of pensioners will be protected. Pensioner couples
      who already receive the allowance will be able to keep this
      entitlement.

As a result of measures in Budget 99, 200,000 pensioners will be
taken out of income tax altogether. The average pensioner household
will be #240 per year better off.

And pensioners with savings will be offered more choice:

-    National Savings will introduce new pensioner bonds offering
      fixed monthly income as existing Pensioner Bonds do, but for
      terms of less than five years. This will give them the security
      of a guaranteed income, without having to lock away their
      savings for as long as five years.

These measures combined ensure that the Government is meeting its
manifesto pledge to help pensioners "share fairly in the increasing
prosperity of the nation."

OTHER FAIRNESS MEASURES

- High quality public services for all

      A massive #1.1 billion package of Investment in key public
      services was announced by Chancellor Gordon Brown today. This
      is in addition to the #40 billion extra for schools and
      hospitals to be delivered from this April - See HMT 12

- A Budget to help the environment

This Budget contains the biggest ever environmental tax package
- See HMT 5

- Review of Charity Taxation

      Proposals to encourage more donations to charity and to
      modernise the tax system for the sector are set out in a
      consultation document published today - See HMT 10

- Tackling tax abuse

Budget 99 contains a package of measures to tackle tax abuse to
ensure that everyone pays their fair share of tax - See CW 3

NOTES FOR EDITORS

1. The minimum levels of support for children come from the
    amounts paid for a family with one child under 11 on Income
    Support (from April 2000, #41 a week or over #2000 a year) and
    for a family with one child solely in receipt of child benefit
    (from April 2000, #15 a week or #780 a year).

2. The data underlying the graph is shown below:

Figures for gains given relative to indexation, and all in 1999
equivalent prices.

The data underlying the chart is contained in the table below. It
is based on Family Expenditure Survey data uprated to 1999-2000
levels of earnings and expenditure.

	All households	Working Households	Households with children
Average (#pa)	380	450	740

The table shows the change in annual net household income from the
major direct tax, National Insurance, and benefit measures announced
in the Budget which take effect in 1999-2000, 2000-01 and 2001-02.
Also included are the effects of those measures which were announced
in the March 1998 Budget and have not yet taken effect.

3. Households have been classified in the following way:

- Households with children are households where there is at least
one child.

- Working households are households where at least one adult is
working full- time, part-time or is self-employed.

For further details see also the following Press Notices:
HMT 3, IR 1 and CW 3

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# = pounds sterling