Widowed Parent's Allowance payments slashed

parent holding child's hand

The Widowed Parent's Allowance isn't a terribly well-known benefit. As the government discusses slashing it dramatically there isn't much of an outcry - because most people only know about this benefit when they desperately need it. If the bill goes through as proposed, parents who are widowed after 2016 will find their situation even harder, as financial problems add to the emotional torment.

Fortunately, there is a way to make sure we are protected.
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Cuts

The allowance currently offers a £2,000 one-off lump sum, and then an allowance of up to £108.12 a week for as long as your family is entitled to child benefit (or you remarry or live with a new partner). The money can be used for bills, to pay for childcare, or to help pay the mortgage: it's a lifeline for many.

However, from 2016, any parent who is widowed after this date will receive just a lump sum of £5,000, and the monthly payments for a year. Clearly the new system is designed to step in at a time of crisis - but assumes that after a year you will somehow be able to make things work alone.

It's difficult to see how a suddenly single parent is expected to be able to earn enough money to pay the bills and the mortgage alone, while simultaneously looking after their children. Unless they dramatically scale back their life, or have an enormous amount of help from their family, they will simply not be able to cope.

And if your children lost a parent less than a year ago, it's going to be difficult for them to understand why they may need to leave their family home, and possibly even the area in which they grew up, at such a difficult time.

Opposition

The change was first proposed in August 2012, and forms part of the Pensions Bill which was published in May, and was debated in the House of Commons yesterday.

This week a number of charities wrote to the Times raising awareness of the cuts, and calling on the government to re-think their plans. The charities, including Cruse Bereavement Care, Gingerbread, The Childhood Bereavement Network and the Low Incomes Tax Reform Group, highlighted that widowed parents and children need this support.

They said of the children: "The care and support of their other parent is crucial in helping them adapt to a radically changed life. The current system of Widowed Parents' Allowance allows parents the flexibility to provide this support, with weekly payments until the youngest child no longer qualifies for Child Benefit. This support system is under threat: the government has included proposals for radical reform of bereavement benefit in the Pensions Bill, proposing to pay it for just one year."

The groups estimate that 90% of people will be worse off, and those with younger children will be particularly badly affected. They added: "Amid the discussions about second-tier pensions and the State Pension age, let us not forget that thousands of grieving children each year will be affected by the changes proposed."

Protect yourself

There is still a fair way to go before the Bill becomes law, with the committee and reports stage, and another debate in the Commons before it goes over to the Lords. There is therefore a chance that widowed parents will be given a break.

However, whatever happens to this particular benefit, it underlines how vital it is for parents to make provision for what will happen in the event of their death. Even under the current system, many millions of parents would not be able to pay the bills.

Parents need to buy life insurance, at the very least they need enough to pay off the mortgage. They also need money to enable their partner to get by, and perhaps cover childcare while their children need it.

The first step is to find out if your employer will pay out if you were to die while employed by them, and if you expect to stay with the company for a significant period you can subtract it from the total you need.

The rest you need to make up yourself through life insurance. The good news is that it doesn't have to cost the earth. The average premium for a non-smoking mum taking out £250,000 insurance for ten years is less than £1 a day.

10 PHOTOS
Where are Britain's highest tax bills?
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Widowed Parent's Allowance payments slashed
St Albans come in second on the list with a total income tax bill of £10,900 per person.
Windsor and Maidenhead came third with a total income tax bill of £10,200 per person.
The Surrey town of Guildford was fourth on the list with a total income tax bill of £9,830 per person.
England's capital city came fifth with a total income tax bill of £8,580 per person.
Wokingham has a total income tax bill of £7,490 per person. Putting it in sixth place.
Dacorum in Hertfordshire comes in joint sixth place with a total income tax bill of £7,490 per person.
The leafy towns of Reigate and Banstead have a total income tax bill of £7,000 per person.
Tonbridge and Malling take joint seventh spot with a total income tax bill of £7,000 per person.
Wycombe comes last in the top ten with a total income tax bill of £6,820 per person.

A small corner of leafy Surrey has taken the top spot in the league table of the highest income tax bills per person. Residents of Elmbridge pay an astonishing £1.18 billion in income tax every year. That puts a number of the major cities in the shade.
The leafy towns of Esher, Weybridge and Walton-on-Thames are filled with mansions, private estates, country clubs, golf courses, and riversides packed with millionaires. The proximity of Chelsea's training ground in Cobham has also brought well-paid sportsmen to the area.

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