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Habitual Residence Test
12. Mr. Peter L. Pike (Burnley): What changes he proposes in the habitual residence test. [53483]
The Parliamentary Under-Secretary of State for Social Security (Angela Eagle): I expect to bring forward our proposals for the future of the habitual residence test later this year.
Mr. Pike: Does my hon. Friend agree that many British citizens who return to this country are caught by the rule introduced by the previous Government and suffer great hardship as a result of the way in which it is enforced?
Angela Eagle: I agree with my hon. Friend's observation. The habitual residence test was introduced after the right hon. Member for Hitchin and Harpenden (Mr. Lilley) sang at the Tory party conference. The rule was intended to end benefit tourism, but 76 per cent. of those who fail the habitual residence test are UK citizens. We are examining the test in great detail to determine its future and find out what can be done to make it more effective. I assure the House that we shall make changes based on facts and cool reflection rather than bigotry and performances at the Tory party conference.
Child Support Agency
13. Mr. Gerry Sutcliffe (Bradford, South): What steps he has taken to improve the operation of the CSA. [53486]
The Parliamentary Under-Secretary of State for Social Security (Angela Eagle): We want a child maintenance service that is simple and straightforward to use and that parents can trust, but that cannot be achieved overnight, so in the meantime, we need to improve the operation of the current scheme while we discuss the radical changes that are proposed in our Green Paper.
We want the Child Support Agency to reduce clearance times, eliminate backlogs of work and improve telephone contact with its clients. To that end, we have provided the agency with an extra £12 million to improve its performance in those areas.
Mr. Sutcliffe:
I know that many people will benefit from those improvements. Will my hon. Friend consider the case of a family in my constituency in which both parents were absent and the grandparents took over the care of the children? The CSA, the local authority and the Benefits Agency were unable to help in that emotional situation. The CSA should try to improve its efforts to make absent parents pay. Will my hon. Friend include other agencies in the review? The grandparents in that case were told that, if the children had been taken into care and then fostered or adopted, the Benefits Agency and local authority could have helped. I find that unforgivable.
Angela Eagle:
My hon. Friend has made a serious point about what happens when neither parent is able to look after children. If he will give me the details of that case, I shall consider what can be done to assist those involved. We shall consider that issue in our response to the Green Paper.
Miss Anne McIntosh (Vale of York):
Will the Minister act quickly to reply to the strong criticisms made in the first annual report by the CSA watchdog, particularly those concerning instructing staff to respond more swiftly to queries and, when assessments have been revised, to process the revision as quickly as possible?
Angela Eagle:
I shall do that. The Government recognise that the system is complicated and difficult to administer. That is why we have published the Green Paper, which suggests radical reforms. I remind the hon. Lady that the previous Government asked the CSA to administer a system that is so complicated that staff must spend 90 per cent. of their time making assessments and can spend only 10 per cent. chasing up payments.
15. Mr. James Gray (North Wiltshire):
What estimates his Department has made of the increase in social security spending for each percentage point which the September retail prices index exceeds the target set by the Chancellor of the Exchequer. [53488]
The Secretary of State for Social Security (Mr. Alistair Darling):
Uprating of social security benefits based on the September retail prices index will not add to our prudent spending plans. I am currently reviewing the rates of social security benefits and I will announce the uprating of social security benefits shortly.
Mr. Gray:
That is all very well, but is not the right hon. Gentleman--who, in his previous incarnation as Chief Secretary to the Treasury, so signally failed to achieve any savings in the benefits budget--ashamed of the fact that his budget will increase by £37 billion during the next three years, and that there is no likelihood that there will be savings of any kind anywhere in his budget?
Mr. Darling:
The hon. Gentleman's difficulty results from the fact that he tabled his question before the summer recess; now that it is October, he has got things badly wrong. However, he might like to bear in mind the fact that, under the previous Government--whom, no doubt, he supported--social security spending was
Mr. Iain Duncan Smith (Chingford and Woodford Green):
I welcome the right hon. Gentleman to his place, but is not the fact that he is now in place and that his predecessor has gone an admission by the Government that they have completely failed on that agenda? My hon. Friend the Member for North Wiltshire (Mr. Gray) asked a specific question about the Government's failure to cut any costs. By their own figures, everything that they have done has raised the cost of social security. Does the right hon. Gentleman now accept that Library figures show that they inherited a budget that was falling--[Hon. Members: "No, it was not."] Yes, it was. Do not those figures also show that the Government have turned the budget around, and are increasing it? What will he do seriously to reduce a budget that is rising, and costs taxpayers money?
Mr. Darling:
For the past hour, I have watched the hon. Gentleman pawing like a bull desperate to enter a china shop, and now here he is. He must face the facts that, under the previous Government, social security spending was rising at about 4 per cent. a year, and that inequality and exclusion increased nevertheless.
The question that we must ask ourselves is twofold. First, what can we do to ensure that the money that we spend is spent to best effect--to provide security for those who most need it? Secondly, we must ensure that, in the proposals that we shall shortly bring forward, we implement principled reform of the welfare state, not for the next two to three years, but for the next two to three decades. I respectfully refer the hon. Gentleman to the speech that I delivered this morning--which he will, no doubt, have available to him shortly--which sets out the approach that the Government will take.
Mr. Duncan Smith:
Yet again, the right hon. Gentleman has adopted his predecessor's habits; he avoids the real question. Although, at the time of the general election, Labour pledged to cut the costs, every single thing that the Government have done has increased those costs. Moreover, as growth is now falling to 1 per cent., the budget will increase by nearly £1 billion in addition to their previous increases. I therefore make the right hon. Gentleman an offer.
Mr. Dennis Skinner (Bolsover):
What would they do?
Mr. Duncan Smith:
The hon. Member for Bolsover is tossing his right hon. Friend a question, asking what the Conservatives would do. We would cut the working families tax credit, thereby increasing the budget dramatically. Why does he not do that now--saving us all money--and stop wasting our time?
Mr. Darling:
Now we at least have a policy from the Opposition, and it is to take away money that is being spent to ensure that work pays for hundreds of thousands of people for whom it has not paid in the past. This Government, unlike the previous Government, are determined to take measures that reduce the number of people who are out of work, including measures to make work pay. Therefore, we are reforming the tax and benefit system and have introduced the working families tax
We are determined to ensure that the social security system and the welfare state are modernised to fit the country's needs, not only in the next two to three years, but in the decades ahead. If the hon. Gentleman is serious about reform, we shall look forward to receiving his support when we propose measures to do just that.
16. Mr. John Healey (Wentworth):
What plans he has under the proposals for reform of the Child Support Agency to ensure that maintenance payments from absent parents who are self-employed are enforced. [53489]
The Parliamentary Under-Secretary of State for Social Security (Angela Eagle):
As my right hon. Friend the Secretary of State said earlier, those are some of the most difficult cases. We are considering basing the child support assessment on the most recent year's taxable income for self-employed non-resident parents. That information will be easy for non-resident parents to provide and should result in fewer disputed assessments.
If the non-resident parent refuses to pay, prompt action will be taken to enforce payment--for example, by sending in bailiffs or deducting money from bank accounts.
Mr. Healey:
I was glad to hear from my right hon. Friend the Secretary of State earlier that the Government are considering the use of the tax system in the long term to clamp down on such absent parents. What would my hon. Friend say to a constituent from Rawmarsh who contacted me last week, whose husband left her with two kids and six months pregnant? He had a £25,000-a-year job, but within weeks went self-employed and has evaded any maintenance payments since. What encouragement can my hon. Friend give to that woman and many others like her that action will be taken in the short term, not just in the long term?
Angela Eagle:
In the short term, the CSA has piloted arrangements including specialist teams to deal with self-employed cases. We have evidence that that is beginning to show beneficial results. However, as I said earlier, such cases are some of the most difficult to deal with. We believe that in the medium term, dealing with them through the income tax assessment system is a more effective way in which to get to the truth in these matters.
Mr. Jonathan Sayeed (Mid-Bedfordshire):
Will there be a Child Support Agency Bill in the Queen's Speech? If not, how do the Government intend to implement their new proposals?
Angela Eagle:
Madam Speaker, I am sure that you would not expect me to tell anyone in the House what was in the Queen's Speech. I hope that I can reassure the hon. Gentleman that we are determined to reform the mess that the Conservatives left us when they left office, and that the promise made by my right hon. Friend the Member for Camberwell and Peckham (Ms Harman) that there would be a draft Bill next year will be fulfilled.
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