AQW 13481/17-22

Mr Alex Easton
Democratic Unionist Party
North Down

Tabled Date: 27/01/2021
Answered On Date: 08/02/2021
Priority Written: No

To ask the Minister for Communities why the Cost of Work Allowance scheme was not brought into Northern Ireland to help lone parents and childcare costs.

The Welfare Reform Mitigations Working Group recommended the introduction of a Cost of Work Allowance as part of the package of welfare mitigation measures.
The Working Group recommendation was for payments to be available to people claiming either Working Tax Credit or Universal Credit with a special weighting for lone parents taking account of the cost of childcare. The scheme was to be delivered over a three year period ending on 31 March 2020.
When developing the Cost of Work Allowance policy the Department was advised by HMRC that payments would be treated as taxable income. Notification of this decision was received in the period when the Assembly was suspended. In view of the estimated impact of personal taxation on the value of Cost of Work Allowance payments to individuals it was the Department’s assessment that the scheme could not be progressed until the return of the Assembly.
The introduction of a Cost of Work Allowance scheme for low-income working families is expected to be included in the forthcoming review of welfare mitigation measures. Details of the review will be announced in due course.