Maternity Allowance is a United Kingdom state benefit for women who are working but not entitled to Statutory Maternity Pay .
64-441: Women who are unable to get Statutory Maternity Pay may be instead entitled to Maternity Allowance. This money is paid by the government rather than an employer. A claimant has to have worked 26 weeks within the 66 weeks before their due date, and have earned at least £30 a week for 13 of those weeks to qualify. If the claimant has not paid enough Class 2 National Insurance Contributions in this period, they will instead be entitled to
128-550: A committee to consider the Report and to set out the government's line. In the Commons debate the government announced they would not implement the Report immediately. The Tory Reform Committee , consisting of 45 Conservative MPs, demanded the founding of a Ministry of Social Security immediately. At the division at the end of the debate, 97 Labour MPs, 11 Independents, 9 Liberals , 3 Independent Labour Party MPs and 1 Communist voted against
192-611: A contributions record while not working, or to those applying for benefits whose contribution record is only slightly short of the requirements for those benefits. In the latter case, they cannot be used to fill "gaps" in past years in contribution records for some benefits. The benefit component comprises a number of contributory benefits of availability and amount determined by the claimant's contribution record and circumstances. Weekly income benefits and some lump-sum benefits to participants upon death, retirement, unemployment, maternity and disability are provided. Benefits for which there
256-581: A fundamental component of the welfare state in the United Kingdom . It acts as a form of social security , since payment of NI contributions establishes entitlement to certain state benefits for workers and their families. Introduced by the National Insurance Act 1911 and expanded by the Labour government in 1948, the system has been subjected to numerous amendments in succeeding years. Initially, it
320-406: A lower amount. Alternatively, Maternity Allowance can be paid if the claimant has assisted a partner in the running of their business. Entitlement starts at the 11th week before the baby is due. Claimants will receive £156.66 a week or 90% of their average weekly earnings (whichever is less), or a reduced amount of £27 a week. It's paid for up to 39 weeks and is not taxable or means-tested. Nothing
384-457: A national milk scheme was launched, which provided a pint of milk at about half price for all children under the age of five, and for expectant or nursing mothers. The take-up rate was such that, by 1944, 95% of those eligible had participated in the scheme. The government's general food policy that priority groups like young children and mothers were not just entitled to essentials like milk, but actually received supplies as well. Evacuation during
448-495: A percentage of net profits above a threshold, which is reviewed periodically. Individuals may also make voluntary contributions to fill a gap in their contributions record and thus protect their entitlement to benefits. Contributions are collected by HM Revenue and Customs (HMRC). For employees, this is done through the PAYE (Pay As You Earn) system along with Income Tax , repayments of Student Loans and any Apprenticeship Levy which
512-405: A periodic basis, usually weekly or monthly depending on how the employee is paid, with no reference to earnings in previous periods. Those for company directors are calculated on an annual basis, to ensure that the correct level of NICs are collected regardless of how often the director chooses to be paid. There are a number of milestone figures which determine the rate of NICs to be paid. These are
576-580: A practical character" which would be put to the electorate after the war and implemented by a new government. These measures were "national compulsory insurance for all classes for all purposes from the cradle to the grave"; the abolition of unemployment by government policies which would "exercise a balancing influence upon development which can be turned on or off as circumstances require"; "a broadening field for State ownership and enterprise"; new housing; major reforms to education; and largely expanded health and welfare services. Churchill's commitment to creating
640-460: A qualifying contribution record for contributions-based Jobseekers Allowance , but do count towards Employment and Support Allowance . Class 3 contributions are voluntary NICs paid by people wishing to fill a gap in their contributions record which has arisen either by not working or by their earnings being too low. Class 3 contributions only count towards State Pension and Bereavement Benefit entitlement. The main reason for paying Class 3 NICs
704-408: A result and unlike Income Tax , a weekly paid employee will face a charge in any week where earnings exceed 1/52 of the annual limit. It is therefore possible for a charge to arise on someone who earns below the limit on an annual basis but who has occasional payments above the weekly limit. A further complication is that an employee has an allowance per employer, unlike income tax where the allowance
SECTION 10
#1733092983083768-583: A welfare state was limited: he and the Conservative Party opposed much of the implementation of the Beveridge Report, including voting against the founding of the NHS. The Labour Party won the 1945 general election on a platform that promised to address Beveridge's five Giant Evils. The report's recommendations were implemented through a series of Acts of Parliament (namely the National Insurance Act 1946 ,
832-441: A year. If a self-employed worker earns £8,632 or more a year they will be categorised as Class 4. Class 2 contributions are charged at £3.00 per week and are usually paid by direct debit. While the amount is calculated to a weekly figure, they were typically paid monthly or quarterly until 2015. For future years, class 2 is collected as part of the tax self-assessment process. For the most part, unlike Class 1, they do not form part of
896-485: Is a contribution condition: Historic benefits for which there was a contribution condition: To administer the National Insurance system, a National Insurance number is allocated to every child shortly after their birth when a claim to Child Benefit is made. People coming from overseas have to apply for a NI number before they can qualify for benefits; although holding a NI number is not a prerequisite for working in
960-626: Is a government report, published in November 1942, influential in the founding of the welfare state in the United Kingdom . It was drafted by the Liberal economist William Beveridge – with research and publicity by his wife, mathematician Janet Philip – who proposed widespread reforms to the system of social welfare to address what he identified as "five giants on the road of reconstruction": "Want… Disease, Ignorance, Squalor and Idleness". Published in
1024-508: Is currently set at the figure at which the higher rate of Income Tax becomes chargeable for a person on the standard personal allowance for Income Tax in all parts of the UK except Scotland (which can set its own level for the tax threshold, but not for the NI upper limit). The 2019-24 government 's manifesto in the 2019 general election promised to restore the parity between the NI and Income Tax thresholds by
1088-401: Is paid for any day worked during this period. You cannot get this together with any other Contributory Benefit or Jobseeker's Allowance . It counts in full as income for Income Support or Housing Benefit , but it is ignored for Tax Credits. If you cannot get Maternity Allowance you might get Employment and Support Allowance . National Insurance National Insurance ( NI ) is
1152-468: Is split between employers via the person's tax code. So a person with two low paid jobs would pay less, possibly nothing, than someone who earned the same amount from one job. In addition, no deductions are allowable unlike with Income Tax. This means that NI becomes payable on a greater share of income (immediately after the threshold). Beveridge Report The Beveridge Report , officially entitled Social Insurance and Allied Services ( Cmd. 6404) ,
1216-405: Is to ensure that a person's contribution record is preserved to provide entitlement to these benefits, though care needs to be taken not to pay unnecessarily as it is not necessary to have contributions in every year of a working life in order to qualify. Class 4 contributions are paid by self-employed people as a portion of their profits. The amount due is calculated with income tax at the end of
1280-652: The Home Office , Ministry of Labour and National Service , Ministry of Pensions , Government Actuary , Ministry of Health , HM Treasury , Reconstruction Secretariat , Board of Customs and Excise , Assistance Board , Department of Health for Scotland , Registry of Friendly Societies and Office of the Industrial Assurance Commissioner . The report was printed by Alabaster Passmore & Sons Limited which kept their factory in Maidstone busy when there
1344-611: The National Assistance Act 1948 , and the National Health Service Act 1946 ) which founded the modern British welfare state. Labour deviated from Beveridge in the state's role: their leaders opposed Beveridge's idea of a National Health Service run through local health centres and regional hospital administrations, preferring a state-run body. Beveridge complained about this: "For Ernest Bevin , with his trade-union background of unskilled workers... social insurance
SECTION 20
#17330929830831408-532: The National Health Services (NHS). However a small percentage is transferred from the funds to the NHS from certain of the smaller sub-classes. Thus the four NHS organisations are partially funded from NI contributions but not from the NI Fund. Less than half of benefit expenditure (42.1%) now goes on contributory benefits, compared with over 65% in 1978–79 because of the growth of means-tested benefits since
1472-506: The PAYE system, along with Income Tax and repayments of Student Loans and Postgraduate Loans. People in certain circumstances, such as caring for a child, caring for a severely disabled person for more than 20 hours a week or claiming unemployment or sickness benefits, can gain National Insurance credits which protects their rights to various benefits. National Insurance is a significant contributor to UK government revenues, with contributions estimated to comprise 18% of total revenue in
1536-479: The RPI . As indicated above, the rates at which an individual and their employer pay contributions depend on a number of factors. Consequently, there are many possible sets of employer/employee contribution rates to allow for all combinations of the various factors. HMRC allocate a letter of the alphabet, referred to as an 'NI Table Letter', to each of these sets of contribution rates. Employers are responsible for allocating
1600-427: The 2019/2020 financial year. National insurance contributions (NICs) fall into a number of classes. Class 1, 2 and 3 NICs paid are credited to an individual's NI account, which determines eligibility for certain benefits - including the state pension. Class 1A, 1B and 4 NIC do not count towards benefit entitlements but must still be paid if due. Class 1 contributions are paid by employers and their employees. In law,
1664-558: The Cabinet, there was debate, instigated by Brendan Bracken , on 16 November 1942 over whether to publish the Report as a White paper at that time. The Chancellor of the Exchequer , Sir Kingsley Wood , said that it involved "an impracticable financial commitment" and that publication should therefore be postponed. However, the Cabinet decided on 26 November to publish it on 2 December. The Ministry of Information Home Intelligence found that
1728-501: The Labour MP and Minister without Portfolio , announced the creation of an inter-departmental committee which would carry out a survey of Britain's social insurance and allied services: To undertake, with special reference to the inter-relation of the schemes, a survey of the existing national schemes of social insurance and allied services, including workmen's compensation, and to make recommendations. Its members were civil servants from
1792-623: The Lower Earnings Limit (LEL), Primary Threshold (PT), Secondary Threshold (ST) and Upper Earnings Limit (UEL), though often the PT and ST are set to the same value. The cash value of most of these figures normally changes each year, either in line with inflation or by some other amount decided by the Chancellor . The PT is normally indexed to inflation using the CPI , while other thresholds remain indexed using
1856-632: The NIRS/2 system from its inception when problems with the new system attracted widespread media coverage. Due to these computer problems, Deficiency Notices (telling individuals of a possible shortfall in their contributions), which had been sent out on an annual basis prior to 1996, stopped being issued; the Inland Revenue took several years to clear the backlog. As a result, many customers were unaware whether they had incomplete years of contributions towards their State Pension (including women affected by
1920-698: The NPS computer system ( National Insurance and PAYE Service ). This came into use in June and July 2009 and brought NIC and Income Tax records together on one system for the first time. The original National Insurance Recording System (NIRS) was a more archaic system first used in 1975 without direct user access to its records. A civil servant working within the Contributions Office (NICO) would have to request paper printouts of an individual's account which could take up to two weeks to arrive. New information to be added to
1984-459: The Report had been "welcomed with almost universal approval by people of all shades of opinion and by all sections of the community" and seen as "the first real attempt to put into practice the talk about a new world". In a sample poll taken in the fortnight after the Report's publication, the British Institute of Public Opinion found that 95% of the public had heard of the Report and that there
Maternity Allowance - Misplaced Pages Continue
2048-488: The UK, a tax code cannot be operated without one. An NI number is in the format: two letters, six digits and one further letter or a space. The example used is typically QQ123456C. It is usual to pair off the digits - such separators are seen on forms used by government departments (both internal and external, notably the P45 and P60 ). National Insurance contributions for all UK residents and some non-residents are recorded using
2112-416: The account would be sent to specialised data entry operatives on paper to be input into NIRS. NIRS/2, introduced in 1996, was a large and complex computer system which had several uses. These included individual applications to access or update an individual National Insurance account, to view employer's National Insurance schemes and a general work management application. There was some controversy regarding
2176-470: The benefits which are related to the contributions, a National Insurance number is necessary. The current system of National Insurance has its roots in the National Insurance Act 1911 , which introduced the concept of benefits based on contributions paid by employed people and their employer. William Martin-Smith was issued with the First NI number A1. The chosen means of recording the contributions required
2240-482: The correct table letter to each employee depending on their particular circumstances. Each tax year, HMRC publish look-up tables for each table letter to assist with manual calculation of contributions, though these days most of the calculations are done by computer systems and the tables are available only as downloads. In addition, HMRC provide an online National Insurance Calculator. Class 1A contributions were introduced from 6 April 1991, and are paid by employers on
2304-486: The course of the war also revealed, to more prosperous Britons, the extent of deprivation in society. Historian Derek Fraser noted that evacuation became "the most important subject in the social history of the war because it revealed, to the whole people, the black spots in its social life." An Emergency Hospital Service was introduced, which provided free treatment to casualties (a definition which included war evacuees), while rationing led to significant improvements in
2368-581: The cradle to the grave." After the Second World War, the Attlee government pressed ahead with the introduction of the Welfare State , of which an expanded National Insurance scheme was a major component. As part of this process, in 1948, a single stamp was introduced which covered all the benefits of the new Welfare State. At that point, responsibility passed to the new Ministry of National Insurance; many of
2432-461: The diets of poor families. As noted by Richard Titmuss , The families in that third of the population of Britain who, in 1938, were chronically undernourished, had their first adequate diet in 1940 and 1941…[after which] the incidence of deficiency diseases, and notably infant mortality, dropped dramatically. The Labour Party eventually also adopted the Beveridge proposals, and after their victory in
2496-496: The employee contribution is referred to as the 'primary' contribution and the employer contribution as the 'secondary', but they are usually referred to simply as employee and employer contributions. The employee contribution is deducted from gross wages by the employer, with no action required by the employee. The employer then adds in their own contribution and remits the total to HMRC along with income tax and other statutory deductions. Contributions for employees are calculated on
2560-575: The employee rates are as shown below and the non-zero employer rates are 0.5% lower than those shown below. Class 2 contributions are fixed weekly amounts paid by the self-employed until 5 April 2024. They are due regardless of trading profits or losses, but those with low earnings can apply for exemption from paying and those on high earnings with liability to either Class 1 or 4 can apply for deferment from paying. As of January 2020, self-employed National Insurance Contributions (NICs) will be categorised as Class 2 when profits are between £6,365 and £8,631.99
2624-578: The employer is liable to pay. National Insurance contributions form a significant proportion of the UK Government's revenue, raising £145 billion in 2019-20 (representing 17.5% of all tax revenue). The benefit component includes several contributory benefits, availability and amount of which is determined by the claimant's contribution record and circumstances. Weekly income and some lump-sum benefits are provided for participants upon death, retirement, unemployment, maternity and disability. In order to obtain
Maternity Allowance - Misplaced Pages Continue
2688-405: The employer meets the tax liabilities on certain benefits). Class 1B contributions are paid at the same rate as Class 1A contributions and do not provide any benefit entitlement for individuals. Contribution rates are set for each tax year by the government. The general rates for the tax year 2023/24 between 6 January and 5 April 2024 are shown below. For those who qualify for the mariners rates,
2752-565: The employer to buy special stamps from a Post Office and affix them to contribution cards. The cards formed proof of entitlement to benefits and were given to the employee when the employment ended, leading to the loss of a job often being referred to as being given your cards , a phrase which endures to this day although the card itself no longer exists. Initially there were two schemes running alongside each other, one for health and pension insurance benefits (administered by "approved societies" including friendly societies and some trade unions) and
2816-458: The end of their first term in office. The limits were harmonised on 6 July 2022. The limits and rates for the following tax year are normally announced at the same time as the autumn budget made by the Chancellor of the Exchequer. Current rates are shown on the hmrc.gov.uk website. The calculation of contributions for employees has to be made on each pay period (for non-directors of a company). As
2880-494: The former approved societies went into liquidation as a result. Stamp cards for class 1 (employed) contributions persisted until 1975 when these contributions finally ceased to be flat-rate and became earnings related, collected along with Income Tax under the PAYE procedures. Making NI contributions is still often described by people as paying their stamp . As the system developed, the link between individual contributions and benefits
2944-521: The government's attitude to the Report; 47% were dissatisfied; 24% "didn't know". Winston Churchill gave a broadcast on 21 March 1943 entitled "After the War", where he warned the public not to impose "great new expenditure on the State without any relation to the circumstances which might prevail at the time" and said there would be "a four-year plan" of post-war reconstruction "to cover five or six large measures of
3008-399: The government. A Ministry of Information Home Intelligence report found that after the debate the left-wing section of the public were disappointed but that "an approving minority" thought that the government was correct to wait until the post-war financial situation was known before making a decision. An opinion poll by the British Institute of Public Opinion found that 29% were satisfied with
3072-591: The late 1970s. An actuarial evaluation of the long-term prospects for the National Insurance system is mandated every 5 years, or whenever any changes are proposed to benefits or contributions. Such evaluations are conducted by the Government Actuary's Department and the resulting reports must be presented to the UK Parliament. The most recent review was conducted as at April 2020, with the report being published two years later. The contributions component of
3136-688: The midst of World War II , the report promised rewards for everyone's sacrifices. Overwhelmingly popular with the public, it formed the basis for the post-war reforms known as the welfare state, which include the expansion of National Insurance and the creation of the National Health Service . In 1940, during the Second World War , the Labour Party entered into a coalition with the Conservative Party . On 10 June 1941 Arthur Greenwood ,
3200-405: The other for unemployment benefit which was administered directly by Government. The Beveridge Report in 1942 proposed expansion and unification of the welfare state under a scheme of what was called social insurance. In March 1943 Winston Churchill in a broadcast entitled " After the War " committed the government to a system of "national compulsory insurance for all classes for all purposes from
3264-526: The rise in State Pension age ). As noted above, the employee contribution was a flat rate stamp until 1975. After this, the rates have been as follows: On 7 September 2021, the government announced an increase of NI rates by 1.25 percentage points for the 2022–23 tax year, breaking its 2019 manifesto promise. From 2023, a new health and social care levy charged at the 1.25% rate would be introduced with NI rates reverting to their previous rates. This move
SECTION 50
#17330929830833328-538: The system, "National Insurance Contributions" (NICs) are paid by employees and employers on earnings, and by employers on certain benefits-in-kind provided to employees. The self-employed contribute partly by a fixed weekly or monthly payment, and partly on a percentage of net profits above a certain threshold. Individuals may also make voluntary contributions, in order to fill a gap in their contributions record and thus protect their entitlement to benefits. Contributions are collected by HM Revenue and Customs (HMRC) through
3392-405: The value of company cars and certain other benefits in kind provided to their employees and directors, at the standard employer contribution percentage rate for the tax year. Class 1A contributions do not provide any benefit entitlement for individuals. Class 1B contributions were introduced on 6 April 1999 and are payable by employers as part of a PAYE Settlement Agreement (an arrangement whereby
3456-706: The way for the postwar UK Welfare State. Infant, child, and maternity services were expanded, while the Official Food Policy Committee (chaired by the deputy PM and Labour leader Clement Attlee ) approved grants of fuel and subsidised milk to mothers and to children under the age of five in June 1940. A month later, the Board of Education decided that free school meals should become more widely available. By February 1945, 73% of children received milk in school, compared with 50% in July 1940. Free vaccination against diphtheria
3520-1059: The year, based on figures supplied on the SA100 tax return . Contributions are based around two thresholds, the Lower Profits Limit (LPL) and the Upper Profits Limit (UPL). These have the same cash values as the Primary Threshold and Upper Earnings Limit used in Class 1 calculations. Class 4 contributions do not form part of a qualifying contribution record for any benefits, including the State Pension, as self-employed people qualify for these benefits by paying Class 2 contributions. People who are unable to work for some reason may be able to claim NI credits (technically credited earnings , since 1987 ). These are equivalent to Class 1 NICs, though are not paid for. They are granted either to maintain
3584-519: Was "great interest in it", but there was criticism that old age pensions were not high enough. They also found that "there was overwhelming agreement that the plan should be put into effect". The Times called the Report "a momentous document which should and must exercise a profound and immediate influence on the direction of social change in Britain", while The Manchester Guardian described it as "a big and fine thing". The Daily Telegraph said it
3648-566: Was a consummation of the revolution begun by David Lloyd George in 1911. The Archbishop of Canterbury , William Temple , said it was "the first time anyone had set out to embody the whole spirit of the Christian ethic in an Act of Parliament". A Parliamentary debate on the Report was planned for February 1943: the Cabinet appointed the Lord President of the Council , Sir John Anderson , to chair
3712-448: Was a contributory form of insurance against illness and unemployment, and eventually provided retirement pensions and other benefits. Currently, workers pay contributions from the age of 16 years, until the age they become eligible for the State pension. Contributions are due from employed people earning at or above a threshold called the Lower Earnings Limit, the value of which is reviewed each year. Self-employed people contribute through
3776-811: Was also provided for children at school. In addition, the Town and Country Planning Act 1944 gave consideration to those areas damaged in bombing raids and enabled local authorities to clear slums, while the Housing (Temporary Accommodation) Act passed that same year made £150 million available for the construction of temporary dwellings. To improve conditions for the elderly, supplementary pensions were introduced in 1940. In 1943, there were further improvements in rates and conditions for those in receipt of supplementary pensions and unemployment assistance. Food prices were stabilised in December 1939, initially as temporary measure, but this
3840-580: Was less important than bargaining about wages." Bevin derided the Beveridge Report as a "Social Ambulance Scheme" and followed the Coalition Government's view that it should not be implemented until the end of the war (he was furious in February 1943 when a large number of Labour back-benchers ignored their leaders and voted against delay in implementing Beveridge). The war years saw great improvements in working conditions and welfare provisions, which paved
3904-559: Was made permanent in August 1940, while both milk and meals were provided at subsidised prices, or free in those cases of real need. In July 1940, increased Treasury grants led to an improvement in the supply of milk and meals in schools. The number of meals taken doubled within a year, and take-up of school milk increased by 50%. By 1945, roughly 33% of all children ate at school compared with just 3.3% (one in thirty) in 1940, while those taking milk increased from about 50% to roughly 75%. In 1940,
SECTION 60
#17330929830833968-583: Was reversed by new chancellor Kwasi Kwarteng effective 6 November 2022. In the early 2000s the lower threshold for employee contributions was aligned with the standard personal allowance for Income Tax but has since diverged significantly, as illustrated in the following table. For 2015–16 there was therefore up to £304.80 payable by someone who has not reached the point where they are liable for Income Tax. This has risen to £352.80 for 2016–17, to £400.32 for 2017–18, to £411.12 for 2018-19 and to £464.16 for 2019–20. This fell to £360 for 2020–21. The upper limit
4032-407: Was very little other printing work available. The Report offered three guiding principles to its recommendations: Beveridge was opposed to "means-tested" benefits. His proposal was for a flat rate universal contribution in exchange for a flat rate universal benefit. Means-testing was intended to play a tiny part because it created high marginal tax rates for the poor (the " poverty trap "). Inside
4096-475: Was weakened. The National Insurance Funds are used to pay for certain types of welfare expenditure and National Insurance payments cannot be used directly to fund general government spending. However, any surplus in the funds is invested in government securities, and so is effectively lent to the government at low rates of interest. National Insurance contributions are paid into the various National Insurance Funds after deduction of monies specifically allocated to
#82917