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Use UC earned income before the work allowance in targeted childcare and local CTR - #2552

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Use UC earned income before the work allowance in targeted childcare and local CTR#2552
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@MaxGhenis

@MaxGhenis MaxGhenis commented Oct 21, 2026

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Refs #1986 (items 2 and 3; item 1 is in #1820 and #2536)

Targeted (two-year-old) childcare and four London boroughs' Council Tax Reduction schemes compared Universal Credit earned income after the work allowance with their limits. The law takes it before the work allowance. This replaces the childcare and CTR parts of draft #1999, cut down to these two items on current main as María asked there.

The third part of #1986, the benefit cap earnings exception, is now covered elsewhere. Main split the benefit cap by scheme (#2089). Vahid Ahmadi's #1820 measures the cap's earned income per claimant, and María Juaristi's #2536 sets the reg 82(1)(a) threshold from the national living wage. This PR doesn't touch either.

Law

  • SI 2014/2147 reg 1: an eligible child includes one whose parent is entitled to "universal credit where that parent had, in the relevant assessment period, earned income not exceeding the applicable amount". Reg 1(3)(a): "'earned income' means income for the purposes of Chapter 2 of Part 6 of the Universal Credit Regulations 2013". Reg 1(3)(c) reads a joint claim's limit against the couple's combined income.
  • Part 6 Chapter 2 is regs 52-64: earned income, its deductions and the minimum income floor (reg 62). The work allowance is reg 22, in Part 3, the award calculation.
  • Council Tax Reduction Schemes (Default Scheme) (England) Regulations 2012, Sch para 37, for an applicant with a UC award: "the authority must … use the calculation or estimate of the amount of the income of the applicant … made by the Secretary of State for the purpose of determining the award of universal credit", adjusted only for the award itself (para 37(3)(a)).

Change

  • New uc_earned_income_before_work_allowance (BenUnit): the sum of uc_individual_earned_income over the is_uc_assessed_claimant members. This is the Part 6 Chapter 2 figure, net of each claimant's own tax, NI and relievable pension contributions, with the minimum income floor.
  • uc_earned_income is now that figure less the work allowance, floored at 0. It is the same value as before, from one sum. The UC award (uc_income_reduction) is its only reader.
  • meets_universal_credit_criteria_for_targeted_childcare_entitlement and the shared local CTR helper (council_tax_reduction/_legacy.py) read uc_earned_income_before_work_allowance.
  • Docs: the targeted childcare page states the earned income definition.

Not modelled, as before: the two- and three-assessment-period look-back in SI 2014/2147 reg 1(5)-(6). The model tests a year's earned income against 12 times the monthly limit.

Tests

YAML from the law:

  • meets_universal_credit_criteria_for_targeted_childcare_entitlement.yaml (new, 9 cases):
    • the Benefit cap, targeted childcare and local CTR use the wrong UC earned income figure #1986 counterexample: a single parent aged 30 with a child aged 2 earns £17,000 in 2026-27, so earned income is 17,000 − 886 tax − 354.40 NI = £15,759.60 > £15,400, and the criterion is not met. On main, the figure after the work allowance met it;
    • £16,500 and £16,501 either side of the limit;
    • a couple combined, and a couple exactly at the limit;
    • pension contributions;
    • a self-employed partner under the minimum income floor, whose floor income counts;
    • no UC.
  • council_tax_reduction.yaml: the Benefit cap, targeted childcare and local CTR use the wrong UC earned income figure #1986 counterexamples in Kingston upon Thames, Merton, Westminster and Newham. Three existing cases that input the old variable now input the new one, with the same expectations.

Fail on main, pass on head. With only these two YAML files copied into a tree at main ecd531776, they give 14 failed, 35 passed: the seven new childcare cases that test earned income and the seven CTR UC cases. On this head they give 49 passed. The childcare, CTR and UC YAML folders give 790 passed.

Mutation check. Restoring the after-work-allowance figure in the childcare rule fails 5 YAML cases and 2 property tests. The CTR cases fail on main in the same way.

Invariants (test_uc_earned_income_before_work_allowance_properties.py, Hypothesis)

Families of one or two adults with a child aged 2, earnings, self-employment and pension contributions, in council, housing association and private rented homes, in 2025, 2026 and 2027:

  1. Differential against the award: uc_earned_income == max(0, uc_earned_income_before_work_allowance − uc_work_allowance), and the figure before the work allowance is never lower.
  2. Differential against the old rule: the new childcare criterion implies the one main used, and equals UC > 0 with earned income before the work allowance at or below the limit.
  3. Monotone: more pay for one adult never turns the criterion on.
  4. A fixed crossing, so 3 isn't vacuous: £16,500 of pay (£15,399.60) meets the 2026-27 criterion and £16,501 does not, with UC in both.

Impact on the certified pair

IMPACT

Overlaps

axiom: TheAxiomFoundation/rulespec-uk#400 queued (SI 2014/2147 reg 1); TheAxiomFoundation/rulespec-uk#401 queued (the four borough CTR schemes)

Reproducer: policyengine_uk/tests/policy/baseline/gov/dfe/targeted_childcare_entitlement/meets_universal_credit_criteria_for_targeted_childcare_entitlement.yaml, policyengine_uk/tests/test_uc_earned_income_before_work_allowance_properties.py::test_crossing_the_limit_by_one_pound_of_pay

🤖 Generated with Claude Code

@MaxGhenis @claude
Use UC earned income before the work allowance in targeted childcare …
e37efb7 
…and local CTR

Part of #1986 (items 2 and 3; item 1, the benefit cap earnings exception, is
in #1820 and #2536). SI 2014/2147 reg 1(3)(a) tests targeted (two-year-old)
childcare on earned income "for the purposes of Chapter 2 of Part 6" of the
UC Regulations 2013, and the Kingston upon Thames, Merton, Newham and
Westminster Council Tax Reduction schemes take the Secretary of State's
calculation of income (Default Scheme para 37). Neither deducts the work
allowance, which is a step in the award (reg 22). Both read the new
uc_earned_income_before_work_allowance; uc_earned_income is that less the
work allowance, as before. Ported from #1999.

Co-Authored-By: Claude Opus 5.5 <noreply@anthropic.com>
@MaxGhenis MaxGhenis mentioned this pull request Oct 21, 2026
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Aggregate impact on certified data: pass

Base ecd531776e against head e4fb0c81f8, both on enhanced_frs_2024_25.h5 (policyengine-uk-data 1.58.1, sha256 056e80fd8e91), fiscal years 2025-26 to 2031-32. Each year is a full microsimulation run on each side.

Checks: 0 broken by this change, 1 failing on both sides, 0 fixed. Moves flagged for review: 18 (thresholds in report_spec.yaml; a flag does not fail the job).

Workflow run and full report

Notes

  • In the years a figure from fewer than 10 records is suppressed (spending.disabled_students_allowance), every total containing it, and the decile incomes, are rebuilt from their other components, so no published total includes it. Those totals are marked †. A change is withheld where the two sides leave out different figures and can't be lined up.

Moves flagged for review

Measure Year Base Head Change
Targeted childcare entitlement 2031-32 121k 84k -36.7k
Targeted childcare entitlement 2030-31 122k 97k -24.9k
Targeted childcare entitlement 2029-30 121k 96k -24.8k
Targeted childcare entitlement 2028-29 121k 96k -24.7k
Targeted childcare entitlement 2027-28 120k 96k -24.6k
Targeted childcare entitlement 2026-27 120k 98k -22.0k
Targeted childcare entitlement 2025-26 119k 98k -21.1k
Targeted childcare entitlement 2031-32 £0.67bn £0.47bn -£200.3m
Targeted childcare entitlement 2030-31 £0.66bn £0.53bn -£131.3m
Targeted childcare entitlement 2029-30 £0.65bn £0.52bn -£128.1m
Targeted childcare entitlement 2028-29 £0.63bn £0.51bn -£125.1m
Targeted childcare entitlement 2027-28 £0.62bn £0.50bn -£122.1m
Targeted childcare entitlement 2026-27 £0.60bn £0.49bn -£111.4m
Extended childcare entitlement 2031-32 £3.55bn £3.66bn +£107.6m
Extended childcare entitlement 2030-31 £3.47bn £3.57bn +£105.1m
Targeted childcare entitlement 2025-26 £0.57bn £0.47bn -£102.7m
Extended childcare entitlement 2029-30 £3.38bn £3.49bn +£102.6m
Extended childcare entitlement 2028-29 £3.30bn £3.40bn +£100.1m

Spending by benefit and service

Measure 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32
Universal Credit -£18 +£7 -£12 -£7 +£93 -£81 +£77
Extended childcare entitlement +£83.7m +£87.6m +£97.7m +£100.1m +£102.6m +£105.1m +£107.6m
Targeted childcare entitlement -£102.7m -£111.4m -£122.1m -£125.1m -£128.1m -£131.3m -£200.3m
Disabled Students' Allowance suppressed suppressed suppressed suppressed suppressed suppressed suppressed

Caseloads

Measure 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32
Targeted childcare entitlement -21.1k -22.0k -24.6k -24.7k -24.8k -24.9k -36.7k
Disabled Students' Allowance suppressed suppressed suppressed suppressed suppressed suppressed suppressed

Government balance, each component counted once

Measure 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32
Government spending -£19.0m † -£23.7m † -£24.4m † -£25.0m † -£25.6m † -£26.2m † -£92.7m †
Government balance, each receipt once +£19.0m † +£23.7m † +£24.4m † +£25.0m † +£25.6m † +£26.2m † +£92.7m †

Model totals

Measure 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32
gov_spending -£19.0m † -£23.7m † -£24.4m † -£25.0m † -£25.6m † -£26.2m † -£92.7m †
household_benefits -£19.0m † -£23.7m † -£24.4m † -£25.0m † -£25.6m † -£26.2m † -£92.7m †
gov_balance +£19.0m † +£23.7m † +£24.4m † +£25.0m † +£25.6m † +£26.2m † +£92.7m †

Household income totals

Measure 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32
Household net income -£19.0m † -£23.7m † -£24.4m † -£25.0m † -£25.6m † -£26.2m † -£92.7m †
Household net income (HBAI definition) +£5 +£12 +£29 -£45 +£24 -£100 +£108

Inequality

Measure 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32
Gini coefficient, equivalised HBAI income before housing costs -0.0000 -0.0000 +0.0000 +0.0000 +0.0000 +0.0000 -0.0000

Mean household net income in each side's own deciles

Measure 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32
Decile 1: mean household_net_income per household -£0.00 † -£0.04 † +£0.00 † +£0.00 † -£0.00 † -£0.00 † -£0.00 †
Decile 2: mean household_net_income per household -£1.82 † -£3.03 † -£3.12 † -£3.19 † -£3.25 † -£3.31 † -£4.10 †
Decile 3: mean household_net_income per household +£0.00 † +£0.00 † -£0.00 † -£0.00 † -£0.00 † -£0.00 † +£0.00 †
Decile 4: mean household_net_income per household +£0.00 † 0 † -£0.00 † -£0.00 † +£0.00 † -£0.00 † +£0.00 †
Decile 5: mean household_net_income per household 0 † +£0.00 † +£0.00 † +£0.00 † +£0.00 † +£0.00 † -£0.00 †
Decile 6: mean household_net_income per household 0 † 0 † -£0.00 † -£0.00 † -£0.00 † -£0.00 † +£0.00 †
Decile 7: mean household_net_income per household -£4.31 † -£4.57 † -£4.59 † -£4.75 † -£4.82 † -£4.95 † -£5.06 †
Decile 8: mean household_net_income per household 0 † 0 † +£0.00 † +£0.00 † +£0.00 † 0 † -£22 †
Decile 10: mean household_net_income per household 0 † 0 † -£0.00 † 0 † +£0.00 † 0 † 0 †

Standard reform costings (change in gov_balance)

Measure 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32
Raise basic rate by 1pp -£20 +£22 +£104 +£82 +£165 +£81 -£55
Raise higher rate by 1pp -£0 -£0 -£0 +£45 +£170 -£0 +£6
Raise personal allowance by ~800GBP/year +£5 +£19 +£83 +£27 -£1 +£38 -£12
Raise child benefit by 25GBP/week per additional child -£0 +£21 +£24 -£16 +£26 -£0 -£18
Reduce Universal Credit taper rate to 20% -£67 +£18 -£38 +£14 +£49 +£18 -£23
Raise Class 1 main employee NICs rate to 10% -£4 +£48 +£131 -£2 +£69 +£37 -£56.9m
Raise VAT standard rate by 2pp -£14 +£4 -£10 +£13 +£13 -£0 -£14
Raise additional rate by 3pp 0 0 +£0 0 -£0 -£0 +£0
Raise the Universal Credit standard allowance by 10% -£20 +£10 +£4 -£13 +£22 +£30 -£85
Raise the State Pension by 10% -£0 0 +£0 +£3 -£0 -£0 0

Standard reforms: change in each reform's target

Measure 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32
Reduce Universal Credit taper rate to 20%: change in universal_credit +£37 -£6 +£74 +£56 -£131 +£23 +£55
Raise the Universal Credit standard allowance by 10%: change in universal_credit +£51 +£24 +£3 +£1 +£1 -£10 +£6

Household net income by decile

Mean change in household net income per household, and as a share of the decile's base income; households stay in the base run's deciles.

Base decile 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32
Decile 1 0 fewer than 10 households change 0 0 0 0 0
Decile 2 fewer than 10 households change fewer than 10 households change fewer than 10 households change fewer than 10 households change fewer than 10 households change fewer than 10 households change fewer than 10 households change
Decile 3 0 0 0 0 0 0 0
Decile 4 0 0 0 0 0 0 0
Decile 5 0 0 0 0 fewer than 10 households change 0 0
Decile 6 0 0 0 0 0 0 0
Decile 7 fewer than 10 households change fewer than 10 households change fewer than 10 households change fewer than 10 households change fewer than 10 households change fewer than 10 households change fewer than 10 households change
Decile 8 0 0 0 0 0 0 fewer than 10 households change
Decile 9 0 0 0 0 0 0 0
Decile 10 0 0 0 0 0 0 0
all fewer than 10 households change fewer than 10 households change fewer than 10 households change fewer than 10 households change fewer than 10 households change fewer than 10 households change fewer than 10 households change
Year People gaining over £1 People losing over £1
2025-26 fewer than 10 households change fewer than 10 households change
2026-27 fewer than 10 households change fewer than 10 households change
2027-28 fewer than 10 households change fewer than 10 households change
2028-29 fewer than 10 households change fewer than 10 households change
2029-30 fewer than 10 households change fewer than 10 households change
2030-31 fewer than 10 households change fewer than 10 households change
2031-32 fewer than 10 households change fewer than 10 households change

No change in any year: receipts by tax head; components the model counts twice; population; poverty rates; people in poverty.

Checks failing on both base and head (1)
  • VAT is never negative (sign:vat): 2025-26: 76 units below zero, a weighted £-54,797,972 in total; 2026-27: 76 units below zero, a weighted £-56,271,349 in total; 2027-28: 76 units below zero, a weighted £-57,609,146 in total
Counted-once check

Each of 84 components was raised by £1 per unit in 2026-27, and every head of its totals was read household by household: its own head must rise by exactly £1, no other tax head may move, no other benefit may rise, and the model's own total must move by what its heads moved. A head that breaks a rule is measured again twice: with every other head held at its baseline value, and with every other head held at its value after the first £1 while the component rises again. It fails where either still shows the response. 0 failed; 0 were skipped.

Provenance
Side Commit Runtime Environment hash Partition hash Time
base main ecd531776e uk 2.145.0 (files e09a3aa74820), core 3.33.2, py 3.13.16 aarch64 ccab9aa7a280 f210f83d5be4 1486.16s
head #2552 merged into main e4fb0c81f8 uk 2.145.0 (files f7a1307aeeea), core 3.33.2, py 3.13.16 aarch64 ccab9aa7a280 f210f83d5be4 1465.66s

Dataset: hf://policyengine/policyengine-uk-data-private/enhanced_frs_2024_25.h5@2526edbbb687a3b54dbb11272e5389e4b62d2ac2, sha256 056e80fd8e9151d78f432a25cde863340baee81304c6216a37fb575ce8563784 (verified on both sides), policyengine-uk-data 1.58.1.

Receipts by tax head: head levels
Measure (head) 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32
Income tax £299.36bn £319.12bn £336.63bn £351.79bn £367.34bn £385.47bn £403.77bn
National Insurance (employee and self-employed) £52.58bn £54.94bn £56.75bn £58.48bn £60.62bn £62.57bn £65.03bn
National Insurance (employer) £152.64bn £159.18bn £164.14bn £168.73bn £176.11bn £181.72bn £188.90bn
Employer NI change borne by capital £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Employer NI change borne by consumers £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Capital gains tax £12.62bn £13.06bn £13.55bn £14.04bn £14.54bn £15.09bn £15.65bn
Student loan repayments £7.83bn £8.12bn £8.35bn £8.56bn £8.79bn £9.04bn £9.38bn
VAT £253.71bn £260.53bn £266.72bn £273.14bn £279.83bn £286.71bn £293.71bn
Change in VAT from its baseline £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
VAT on private school fees £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Fuel duties £24.53bn £24.64bn £26.64bn £26.69bn £26.42bn £25.76bn £26.35bn
Alcohol duties £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Tobacco duties £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Vehicle excise duties £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
TV licence fee £4.28bn £4.43bn £4.44bn £4.46bn £4.49bn £4.51bn £4.53bn
Council tax £49.56bn £52.45bn £55.78bn £59.39bn £62.98bn £66.74bn £70.70bn
High value council tax surcharge £0.00bn £0.00bn £0.00bn £0.48bn £0.49bn £0.51bn £0.52bn
Northern Ireland domestic rates £0.55bn £0.58bn £0.61bn £0.63bn £0.67bn £0.70bn £0.73bn
Business rates £31.73bn £31.73bn £31.73bn £31.73bn £31.73bn £31.73bn £31.73bn
Stamp duty land tax (own purchases, and corporate until the £10.06bn £10.56bn £10.98bn £11.40bn £11.81bn £12.23bn £12.64bn
Land transaction tax (Wales) £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Land and buildings transaction tax (Scotland) £0.01bn £0.01bn £0.02bn £0.02bn £0.02bn £0.02bn £0.02bn
Unspecified tax change borne by capital £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Unspecified tax change borne by consumers £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Wealth tax £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Wealth tax excluding the main residence £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Land value tax £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Carbon tax £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Spending by benefit and service: head levels
Measure (head) 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32
State Pension £122.50bn £127.12bn £128.28bn £130.21bn £134.05bn £138.02bn £142.08bn
Pension Credit £6.66bn £7.04bn £7.02bn £7.09bn £7.21bn £7.34bn £7.44bn
Winter Fuel Payment £1.70bn £1.68bn £1.59bn £1.57bn £1.57bn £1.55bn £1.52bn
Pension Age Winter Heating Payment (Scotland) £0.19bn £0.20bn £0.20bn £0.21bn £0.21bn £0.22bn £0.22bn
Universal Credit £78.78bn £83.08bn £84.89bn £86.65bn £87.58bn £88.99bn £90.32bn
Housing Benefit £8.59bn £8.92bn £9.19bn £9.33bn £9.61bn £9.87bn £10.15bn
Council Tax Reduction £1.99bn £2.03bn £2.08bn £2.13bn £2.18bn £2.23bn £2.28bn
Employment and Support Allowance (income-related) £2.12bn £2.18bn £2.23bn £2.28bn £2.33bn £2.39bn £2.45bn
Employment and Support Allowance (contribution-based) £5.22bn £5.36bn £5.49bn £5.62bn £5.76bn £5.90bn £6.04bn
Jobseeker's Allowance (income-based) £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Jobseeker's Allowance (contribution-based) £0.29bn £0.30bn £0.30bn £0.31bn £0.32bn £0.33bn £0.33bn
Income Support £0.12bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Working Tax Credit £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Child Tax Credit £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Incapacity Benefit £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Personal Independence Payment £27.05bn £28.19bn £28.94bn £29.64bn £30.37bn £31.11bn £31.87bn
Disability Living Allowance £7.52bn £7.83bn £8.04bn £8.24bn £8.44bn £8.65bn £8.86bn
Attendance Allowance £8.71bn £9.08bn £9.32bn £9.55bn £9.78bn £10.02bn £10.26bn
Carer's Allowance £4.50bn £4.69bn £4.81bn £4.93bn £5.05bn £5.17bn £5.29bn
Carer Support Payment (Scotland) £0.35bn £0.37bn £0.38bn £0.39bn £0.40bn £0.41bn £0.41bn
Carer's Allowance Supplement (Scotland) £0.00bn £0.05bn £0.05bn £0.05bn £0.05bn £0.05bn £0.05bn
Severe Disablement Allowance £0.03bn £0.03bn £0.03bn £0.03bn £0.03bn £0.03bn £0.03bn
Industrial Injuries Disablement Benefit £0.51bn £0.52bn £0.53bn £0.54bn £0.56bn £0.57bn £0.59bn
Armed Forces Compensation Scheme £0.61bn £0.62bn £0.64bn £0.65bn £0.67bn £0.69bn £0.70bn
War Widow's or Widower's Pension £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Child Benefit £16.23bn £16.91bn £17.32bn £17.73bn £18.16bn £18.60bn £19.04bn
Scottish Child Payment £0.50bn £0.52bn £0.53bn £0.55bn £0.56bn £0.57bn £0.58bn
Two Child Limit Payment (Scotland, counterfactual) £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Healthy Start vouchers £0.05bn £0.05bn £0.05bn £0.05bn £0.05bn £0.05bn £0.05bn
Maternity Allowance £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Statutory Maternity Pay £3.32bn £3.41bn £3.49bn £3.57bn £3.66bn £3.75bn £3.84bn
Statutory Paternity Pay £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Statutory Sick Pay £1.13bn £1.16bn £1.19bn £1.22bn £1.25bn £1.28bn £1.31bn
Sure Start Maternity Grant £0.01bn £0.01bn £0.01bn £0.01bn £0.01bn £0.01bn £0.01bn
Bereavement Support Payment £0.67bn £0.69bn £0.70bn £0.72bn £0.74bn £0.76bn £0.78bn
Tax-Free Childcare £0.55bn £0.56bn £0.57bn £0.58bn £0.60bn £0.61bn £0.59bn
Extended childcare entitlement £2.75bn £3.23bn £3.32bn £3.40bn £3.49bn £3.57bn £3.66bn
Universal childcare entitlement £3.32bn £3.59bn £3.69bn £3.78bn £3.88bn £3.99bn £4.08bn
Targeted childcare entitlement £0.47bn £0.49bn £0.50bn £0.51bn £0.52bn £0.53bn £0.47bn
Care to Learn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Childcare Grant £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Parents' Learning Allowance £0.20bn £0.20bn £0.20bn £0.20bn £0.20bn £0.20bn £0.20bn
Adult Dependants' Grant £0.06bn £0.06bn £0.04bn £0.04bn £0.04bn £0.04bn £0.04bn
Travel Grant £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Disabled Students' Allowance suppressed suppressed suppressed suppressed suppressed suppressed suppressed
16 to 19 Bursary Fund £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
NHS spending £204.68bn £205.46bn £206.22bn £207.04bn £207.96bn £208.89bn £209.79bn
State education spending £0.02bn £0.02bn £0.02bn £0.02bn £0.02bn £0.02bn £0.02bn
Transport subsidy spending £25.15bn £25.25bn £25.34bn £25.44bn £25.55bn £25.67bn £25.78bn
Cost-of-living support payment £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Energy Bills Rebate £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Energy Price Guarantee subsidy £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Basic income £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Disability basic income £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Other public spending budget change £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Caseloads: head levels
Measure (head) 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32
State Pension 11,308k 11,208k 10,906k 10,812k 10,860k 10,908k 10,955k
Pension Credit 1,490k 1,489k 1,477k 1,455k 1,457k 1,454k 1,450k
Winter Fuel Payment 7,091k 7,008k 6,593k 6,509k 6,491k 6,377k 6,242k
Pension Age Winter Heating Payment (Scotland) 806k 807k 807k 805k 809k 812k 816k
Universal Credit 6,371k 6,379k 6,409k 6,419k 6,395k 6,387k 6,371k
Housing Benefit 1,254k 1,252k 1,254k 1,240k 1,244k 1,247k 1,249k
Council Tax Reduction 3,184k 3,210k 3,223k 3,244k 3,261k 3,279k 3,292k
Employment and Support Allowance (income-related) 187k 188k 188k 189k 190k 190k 191k
Employment and Support Allowance (contribution-based) 722k 724k 727k 730k 733k 737k 740k
Jobseeker's Allowance (income-based) 0k 0k 0k 0k 0k 0k 0k
Jobseeker's Allowance (contribution-based) 67k 67k 68k 68k 68k 69k 69k
Income Support 25k 0k 0k 0k 0k 0k 0k
Working Tax Credit 0k 0k 0k 0k 0k 0k 0k
Child Tax Credit 0k 0k 0k 0k 0k 0k 0k
Incapacity Benefit 0k 0k 0k 0k 0k 0k 0k
Personal Independence Payment 3,581k 3,595k 3,608k 3,623k 3,639k 3,655k 3,671k
Disability Living Allowance 1,296k 1,301k 1,306k 1,311k 1,317k 1,323k 1,329k
Attendance Allowance 1,701k 1,708k 1,714k 1,721k 1,729k 1,736k 1,744k
Carer's Allowance 1,038k 1,042k 1,046k 1,050k 1,055k 1,059k 1,064k
Carer Support Payment (Scotland) 81k 82k 82k 82k 83k 83k 83k
Carer's Allowance Supplement (Scotland) 0k 82k 82k 82k 83k 83k 83k
Severe Disablement Allowance 4k 4k 4k 4k 4k 4k 4k
Industrial Injuries Disablement Benefit 137k 138k 139k 139k 140k 140k 141k
Armed Forces Compensation Scheme 94k 94k 94k 95k 95k 95k 96k
War Widow's or Widower's Pension 0k 0k 0k 0k 0k 0k 0k
Child Benefit 8,136k 8,165k 8,185k 8,215k 8,249k 8,282k 8,314k
Scottish Child Payment 352k 354k 355k 356k 357k 358k 357k
Two Child Limit Payment (Scotland, counterfactual) 0k 0k 0k 0k 0k 0k 0k
Healthy Start vouchers 200k 201k 202k 203k 204k 204k 205k
Maternity Allowance 0k 0k 0k 0k 0k 0k 0k
Statutory Maternity Pay 334k 335k 336k 338k 339k 341k 342k
Statutory Paternity Pay 0k 0k 0k 0k 0k 0k 0k
Statutory Sick Pay 182k 183k 183k 184k 185k 186k 186k
Sure Start Maternity Grant 26k 26k 26k 27k 27k 27k 27k
Bereavement Support Payment 98k 98k 99k 99k 100k 100k 101k
Tax-Free Childcare 1,017k 1,028k 1,028k 1,033k 1,034k 1,038k 1,023k
Extended childcare entitlement 665k 671k 675k 677k 682k 686k 687k
Universal childcare entitlement 986k 989k 992k 997k 1,002k 1,013k 1,015k
Targeted childcare entitlement 98k 98k 96k 96k 96k 97k 84k
Care to Learn 0k 0k 0k 0k 0k 0k 0k
Childcare Grant 0k 0k 0k 0k 0k 0k 0k
Parents' Learning Allowance 98k 99k 99k 100k 100k 100k 101k
Adult Dependants' Grant 18k 18k 12k 13k 13k 13k 13k
Travel Grant 0k 0k 0k 0k 0k 0k 0k
Disabled Students' Allowance suppressed suppressed suppressed suppressed suppressed suppressed suppressed
16 to 19 Bursary Fund 0k 0k 0k 0k 0k 0k 0k
Cost-of-living support payment 0k 0k 0k 0k 0k 0k 0k
Energy Bills Rebate 0k 0k 0k 0k 0k 0k 0k
Energy Price Guarantee subsidy 0k 0k 0k 0k 0k 0k 0k
Basic income 0k 0k 0k 0k 0k 0k 0k
Disability basic income 0k 0k 0k 0k 0k 0k 0k
Government balance, each component counted once: head levels
Measure (head) 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32
Government receipts, each component once £899.46bn £939.35bn £976.35bn £1,009.56bn £1,045.84bn £1,082.79bn £1,123.66bn
Government spending £536.56bn † £550.89bn † £557.23bn † £564.29bn † £572.85bn † £582.09bn † £591.18bn †
Government balance, each receipt once £362.90bn † £388.46bn † £419.12bn † £445.26bn † £473.00bn † £500.70bn † £532.49bn †
Benefits in household_benefits but not in gov_spending £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn £0.00bn
Model totals: head levels
Measure (head) 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32
gov_tax £902.59bn £942.48bn £979.48bn £1,012.69bn £1,048.97bn £1,085.92bn £1,126.79bn
household_tax £496.24bn £522.77bn £548.61bn £570.81bn £593.03bn £617.48bn £644.19bn
pre_budget_change_household_tax £488.42bn £514.65bn £540.26bn £561.77bn £583.75bn £607.94bn £634.29bn
gov_spending £536.56bn † £550.89bn † £557.23bn † £564.29bn † £572.85bn † £582.09bn † £591.18bn †
household_benefits £536.56bn † £550.89bn † £557.23bn † £564.29bn † £572.85bn † £582.09bn † £591.18bn †
gov_balance £366.03bn † £391.59bn † £422.25bn † £448.39bn † £476.13bn † £503.83bn † £535.62bn †
Components the model counts twice: head levels
Measure (head) 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32
corporate_sdlt, counted again inside expected_sdlt £3.13bn £3.13bn £3.13bn £3.13bn £3.13bn £3.13bn £3.13bn
Household income totals: head levels
Measure (head) 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32
Household market income £1,657.06bn £1,719.25bn £1,771.68bn £1,821.99bn £1,872.88bn £1,930.99bn £2,001.98bn
Household net income £1,658.10bn † £1,706.61bn † £1,738.41bn † £1,772.53bn † £1,808.62bn † £1,850.26bn † £1,901.92bn †
Household net income (HBAI definition) £1,466.68bn £1,513.41bn £1,545.63bn £1,578.61bn £1,612.63bn £1,651.68bn £1,702.11bn
Population: head levels
Measure (head) 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32
People 69,514k 69,778k 70,036k 70,316k 70,626k 70,944k 71,249k
Benefit units 35,247k 35,381k 35,512k 35,654k 35,811k 35,972k 36,127k
Households 31,167k 31,285k 31,401k 31,526k 31,665k 31,808k 31,944k
Poverty rates: head levels
Measure (head) 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32
Absolute poverty, before housing costs: everyone 15.9% 14.9% 15.5% 15.6% 15.7% 15.8% 15.7%
Absolute poverty, before housing costs: children 23.7% 20.9% 21.6% 21.4% 21.6% 21.8% 21.7%
Absolute poverty, before housing costs: working-age adults 13.8% 13.4% 14.0% 14.1% 14.2% 14.3% 14.3%
Absolute poverty, before housing costs: pensioners 13.7% 13.1% 13.2% 13.4% 13.5% 13.6% 13.6%
Absolute poverty, after housing costs: everyone 21.1% 20.6% 21.3% 21.5% 21.9% 22.2% 22.3%
Absolute poverty, after housing costs: children 32.1% 30.3% 30.9% 31.1% 31.7% 32.3% 32.5%
Absolute poverty, after housing costs: working-age adults 19.6% 19.4% 20.2% 20.4% 20.8% 21.0% 21.0%
Absolute poverty, after housing costs: pensioners 12.7% 12.5% 12.6% 12.9% 13.0% 13.1% 13.4%
Relative poverty, before housing costs: everyone 16.9% 16.4% 16.4% 16.5% 16.6% 16.7% 16.7%
Relative poverty, before housing costs: children 25.6% 23.5% 23.2% 23.2% 23.3% 23.4% 23.4%
Relative poverty, before housing costs: working-age adults 14.4% 14.4% 14.7% 14.8% 14.9% 15.1% 15.0%
Relative poverty, before housing costs: pensioners 14.8% 14.9% 14.1% 14.3% 14.2% 14.2% 14.4%
Relative poverty, after housing costs: everyone 21.7% 21.3% 21.4% 21.5% 21.7% 21.8% 22.0%
Relative poverty, after housing costs: children 33.0% 31.6% 31.2% 31.1% 31.5% 31.6% 32.0%
Relative poverty, after housing costs: working-age adults 20.0% 20.0% 20.3% 20.4% 20.6% 20.8% 20.9%
Relative poverty, after housing costs: pensioners 13.5% 13.1% 12.7% 12.8% 12.7% 12.7% 12.8%
People in poverty: head levels
Measure (head) 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32
Absolute poverty, before housing costs: everyone 11,051k 10,427k 10,848k 10,947k 11,079k 11,209k 11,220k
Absolute poverty, before housing costs: children 3,560k 3,141k 3,261k 3,253k 3,298k 3,334k 3,335k
Absolute poverty, before housing costs: working-age adults 5,864k 5,737k 6,070k 6,165k 6,237k 6,315k 6,321k
Absolute poverty, before housing costs: pensioners 1,627k 1,549k 1,517k 1,529k 1,544k 1,561k 1,565k
Absolute poverty, after housing costs: everyone 14,659k 14,362k 14,899k 15,116k 15,444k 15,724k 15,870k
Absolute poverty, after housing costs: children 4,809k 4,556k 4,676k 4,719k 4,835k 4,939k 4,994k
Absolute poverty, after housing costs: working-age adults 8,333k 8,326k 8,775k 8,931k 9,122k 9,275k 9,329k
Absolute poverty, after housing costs: pensioners 1,518k 1,480k 1,449k 1,466k 1,487k 1,509k 1,547k
Relative poverty, before housing costs: everyone 11,760k 11,456k 11,504k 11,625k 11,706k 11,868k 11,916k
Relative poverty, before housing costs: children 3,840k 3,538k 3,514k 3,525k 3,546k 3,582k 3,603k
Relative poverty, before housing costs: working-age adults 6,154k 6,160k 6,365k 6,465k 6,537k 6,651k 6,652k
Relative poverty, before housing costs: pensioners 1,766k 1,758k 1,625k 1,634k 1,623k 1,634k 1,661k
Relative poverty, after housing costs: everyone 15,065k 14,863k 14,993k 15,090k 15,319k 15,490k 15,653k
Relative poverty, after housing costs: children 4,948k 4,756k 4,711k 4,715k 4,798k 4,840k 4,919k
Relative poverty, after housing costs: working-age adults 8,511k 8,559k 8,822k 8,917k 9,070k 9,192k 9,260k
Relative poverty, after housing costs: pensioners 1,605k 1,548k 1,460k 1,458k 1,452k 1,457k 1,475k
Inequality: head levels
Measure (head) 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32
Gini coefficient, equivalised HBAI income before housing costs 0.3074 0.3051 0.3065 0.3071 0.3077 0.3083 0.3094
Mean household net income in each side's own deciles: head levels
Measure (head) 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32
Decile 1: mean household_net_income per household £17,707 † £17,997 † £17,941 † £17,992 † £18,326 † £18,523 † £18,684 †
Decile 2: mean household_net_income per household £28,361 † £29,046 † £28,669 † £29,010 † £29,370 † £29,776 † £30,327 †
Decile 3: mean household_net_income per household £34,607 † £35,886 † £36,508 † £37,008 † £37,263 † £37,824 † £38,511 †
Decile 4: mean household_net_income per household £39,329 † £40,908 † £41,807 † £42,695 † £43,186 † £43,984 † £45,129 †
Decile 5: mean household_net_income per household £44,871 † £46,147 † £47,077 † £47,609 † £48,379 † £49,251 † £50,073 †
Decile 6: mean household_net_income per household £47,930 † £49,324 † £50,272 † £51,070 † £52,170 † £52,939 † £54,222 †
Decile 7: mean household_net_income per household £56,316 † £57,574 † £58,464 † £59,409 † £60,119 † £61,602 † £63,187 †
Decile 8: mean household_net_income per household £69,250 † £70,361 † £71,635 † £72,869 † £74,327 † £75,790 † £77,541 †
Decile 9: mean household_net_income per household £79,686 † £82,010 † £83,245 † £84,446 † £86,085 † £87,570 † £90,640 †
Decile 10: mean household_net_income per household £117,623 † £120,464 † £122,413 † £124,563 † £126,773 † £129,082 † £131,885 †
Standard reform costings (change in gov_balance): head levels
Measure (head) 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32
Raise basic rate by 1pp £6.22bn £6.50bn £6.71bn £6.90bn £7.11bn £7.35bn £7.62bn
Raise higher rate by 1pp £3.54bn £3.82bn £4.05bn £4.27bn £4.49bn £4.76bn £4.96bn
Raise personal allowance by ~800GBP/year £-3.83bn £-3.96bn £-4.03bn £-4.10bn £-4.20bn £-4.30bn £-2.02bn
Raise child benefit by 25GBP/week per additional child £-2.00bn £-1.76bn £-1.64bn £-1.54bn £-1.44bn £-1.34bn £-1.24bn
Reduce Universal Credit taper rate to 20% £-20.54bn £-21.09bn £-21.45bn £-21.87bn £-21.95bn £-22.32bn £-22.79bn
Raise Class 1 main employee NICs rate to 10% £11.06bn £11.51bn £11.83bn £12.14bn £12.47bn £12.81bn £13.23bn
Raise VAT standard rate by 2pp £25.01bn £25.68bn £26.29bn £26.92bn £27.58bn £28.26bn £28.95bn
Raise additional rate by 3pp £2.83bn £3.07bn £3.27bn £3.47bn £3.67bn £3.91bn £4.23bn
Raise the Universal Credit standard allowance by 10% £-3.04bn £-3.17bn £-3.24bn £-3.32bn £-3.37bn £-3.42bn £-3.47bn
Raise the State Pension by 10% £-8.92bn £-9.13bn £-9.03bn £-9.06bn £-9.26bn £-9.51bn £-9.78bn
Standard reforms: change in each reform's target: head levels
Measure (head) 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 2031-32
Raise basic rate by 1pp: change in income_tax £6.36bn £6.65bn £6.87bn £7.07bn £7.29bn £7.53bn £7.81bn
Raise higher rate by 1pp: change in income_tax £3.55bn £3.83bn £4.06bn £4.28bn £4.50bn £4.78bn £4.97bn
Raise personal allowance by ~800GBP/year: change in income_tax £-3.96bn £-4.11bn £-4.19bn £-4.27bn £-4.36bn £-4.47bn £-1.77bn
Raise child benefit by 25GBP/week per additional child: change in child_benefit £2.34bn £2.15bn £2.03bn £1.92bn £1.82bn £1.71bn £1.59bn
Reduce Universal Credit taper rate to 20%: change in universal_credit £20.53bn £21.08bn £21.44bn £21.86bn £21.95bn £22.32bn £22.78bn
Raise Class 1 main employee NICs rate to 10%: change in national_insurance £11.33bn £11.79bn £12.13bn £12.44bn £12.78bn £13.13bn £13.62bn
Raise VAT standard rate by 2pp: change in vat £25.01bn £25.68bn £26.29bn £26.92bn £27.58bn £28.26bn £28.95bn
Raise additional rate by 3pp: change in income_tax £2.83bn £3.07bn £3.27bn £3.47bn £3.67bn £3.91bn £4.23bn
Raise the Universal Credit standard allowance by 10%: change in universal_credit £3.04bn £3.17bn £3.25bn £3.32bn £3.37bn £3.43bn £3.47bn
Raise the State Pension by 10%: change in state_pension £12.25bn £12.71bn £12.83bn £13.02bn £13.41bn £13.80bn £14.21bn

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Review status: COMPLETE
Review severity: APPROVE
Reviewed head: e37efb7

The childcare and four local Council Tax Reduction consumers now use UC earnings before the work allowance, consistent with SI 2014/2147 reg. 1, UC reg. 22, and the current Kingston, Merton, Newham and Westminster schemes. Claimant filtering, deductions, the minimum income floor and the UC award calculation remain intact.

Validation: 312 affected YAML tests and all 4 new property tests pass; Ruff passes on the 5 changed Python files. A full childcare-path check crosses the limit at £16,500/£16,501 of pay while UC remains positive. The existing working-parent entitlement covers the resulting change in the targeted entitlement where it applies. Official source checks found no material gap. The annual assessment-period approximation remains disclosed and unchanged; full microsimulation and docs were not rerun locally.

No blocking findings. This approval covers the reviewed commit; the PR remains draft.

@MaxGhenis
MaxGhenis marked this pull request as ready for review October 22, 2026 17:31
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MaxGhenis added this pull request to the merge queue Oct 22, 2026
Merged via the queue into main with commit 675a6bd Oct 23, 2026
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MaxGhenis deleted the uc-earned-income-before-work-allowance-1986 branch October 23, 2026 01:07
MaxGhenis added a commit that referenced this pull request Oct 23, 2026
@MaxGhenis @claude
Restate the targeted childcare route oracles for legal eligibility
ac917d3 
Since #2177 targeted_childcare_entitlement_eligible is legal eligibility:
standalone take-up (would_claim_targeted_childcare) and eligibility for the
working parent entitlement no longer remove it. The route-identity and
differential oracles still required both, so they failed on every family
that does not claim targeted childcare on its own or is eligible for the
extended hours. The oracles are now England and at least one route open.

The Universal Credit criterion reads earned income before the work
allowance since #2552 (SI 2014/2147 reg 1(3)(a)); the union property now
checks the criterion against that rule for every generated family, and two
known families pin both changes: a Universal Credit claimant also eligible
for working parent hours qualifies, and a £20,000 earner on Universal
Credit (£17,920 before the work allowance) does not.

Co-Authored-By: Claude Opus 5.5 <noreply@anthropic.com>
@MaxGhenis MaxGhenis mentioned this pull request Oct 23, 2026
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