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Mr. Pickles: We are saying that when we return to power there will be a groundswell of opinion among the public--people receiving the tax credit and people who
have to administer it. They will say, "We want this changed." We will respond because we are that kind of party. I do not know why the hon. Lady is getting so excited.
The Financial Secretary to the Treasury (Mrs. Barbara Roche): The hon. Gentleman has been extremely generous in giving way. I am anxious to follow his argument. I understand his argument thus: should his party have the great good fortune to return to power, there will be a groundswell of opinion among the British public, who will say, "We now do not want this extra £17 a week. Please take it away," and the Conservative party will do so. Is that what he is saying?
Mr. Pickles: It is acceptable for Back Benchers to be misled by the Whips, but the Minister should know better. She knows that a considerable amount of that money will be taken up by the cost of administering this very difficult and expensive system. Now, to use a time-honoured phrase, I must make some progress.
This Bill, perhaps more than any other that I have debated in the House, is dependent on secondary legislation. It is a skeletal Bill that Ministers will fill out at their leisure. We know that an entire tax credit is missing. The child care tax credit is something that the House of Commons Library describes as an integral part of the working families tax credit and the disabled persons tax credit. It is so integral that the Paymaster General spent considerable time on the "Today" programme saying how important it was. In an exclusive interview with the Daily Mirror, she spent a lot of time explaining how important child care credit was. Yet there are more column inches devoted to child care tax credit in her exclusive in the Daily Mirror than in the Bill. That is not hard, because there are no column inches devoted to child care tax credit in the Bill.
As the House tramples the boards of this Marie Celeste of a Bill, we will have to have important details filled in later. There is a frightening preponderance of Henry VIII clauses in the Bill. As the song goes, "Every one was an 'Enery". It is ironic that the Government, who boast so often that they are the great modernising Government, should now have as an unsung hero a Tudor monarch.
These concerns are shared by hon. Members on both sides of the House. In a recent report on tax and benefits, the Select Committee on Social Security expresses concern about the parliamentary scrutiny of "skeleton" Bills, saying that producing such Bills
In its report, the Social Security Committee recommended that there should be a new category of statutory instrument: a super-affirmative instrument, whose complexity and political importance warranted detailed investigation. If ever a Bill deserved to be dealt with on a super-affirmative basis, it is the one before us now. Matters as complex as the WFTC and the DPTC need full and effective scrutiny by Parliament; when the further complexity of the child care tax credit is added, that need is undeniable.
There are many questions about how the child care tax credit would work that require answers. The House needs to know whether it will penalise mothers who look after their own children, yet make it an advantage to look after other people's children. We need to know whether the House of Commons Library research paper is right to assert:
Finally, we have the view of the assistant director of the personal tax division of the Inland Revenue, who gave evidence to the Select Committee. In response to a question asked by my hon. Friend the Member for Bromsgrove (Miss Kirkbride) about whether or not a mother could register as a child minder, he said:
Do the Government now intend to regulate and codify child minding? Will becoming a child minder in itself qualify a person for the working families tax credit? Those are decisions that should be taken by the House. From what we can glean from the Bill, the proposals penalise mothers who look after their own children and two-parent families. The House has a right and a duty to decide on that issue and to amend and fine-tune the Government's proposals, and not to be left with a take-it-or-leave-it dismissal.
Ms Sally Keeble (Northampton, North):
Does the hon. Gentleman accept that he has taken small pieces of a complex piece of legislation and juxtaposed them so as to make them look like a jumble, when it is perfectly clear that the proposals will provide flexibility of choice for working mothers and enable them to obtain appropriate and high-quality child care for their children?
Mr. Pickles:
The hon. Lady has missed the point. We should make decisions about that complexity. The House
Ms Keeble:
Will the hon. Gentleman give way?
Mr. Pickles:
No, I have been generous and I now want to make progress.
The Bill is vague, and not only about child care tax credit. We know that the Royal Association for Disability and Rehabilitation and other disability groups have expressed concern that people who receive the disabled persons tax credit will not automatically be entitled to free prescriptions, as they are with the disabled working allowance. The Minister will be aware that at a recent meeting with the Treasury and RADAR, the Government offered no guarantees about free prescriptions. Concern is also expressed about benefits currently available with DWA, including housing benefit and help from social services for children and young people in need.
Moving from family support to a tax credit is not an original idea of the new Labour Government. In the mid-1980s, the Conservative Government considered such a move and rejected it. I have no doubt that many hon. Members have a dog-eared copy of "The View from Number 11: Memoirs of a Tory Radical" by the former Chancellor, now Lord Lawson. For those who cannot abide the thought of taking that much-loved document out of the safety of their own library, his views on tax credits are reproduced in the House of Commons research paper 99/3.
The former Chancellor said that there was an overwhelming practical case for keeping the two systems apart. He argued that they are different in that one considers an individual's income and the other considers the income and capital of the individual and the family. I am sure that that is why he withdrew the proposals, but there may have been other reasons.
There was a great deal of opposition from another place and, more importantly, a near revolt by the national women's organisations in the Conservative party. At that time, I was a member of the national executive committee of the National Union of Conservative Associations. I have a vivid recollection of the heated debates on those proposals. The Conservative women's organisations made a positive case for continuing to ensure that income to support the family was paid to the wife, in much the same way as child benefit is paid to the mother. That is a classic case of the argument between the wallet and the purse.
Those arguments were eloquently put by the hon. Member for Regent's Park and Kensington, North (Ms Buck), who said that in
"makes Parliamentary scrutiny at that stage very difficult. The detailed rules are contained in statutory instruments made later, although at that point there is no practical opportunity for Parliament to comment substantively, or to amend."
When we consider statutory instruments, usually in Committee, our scrutiny is carried out on the basis of "take it or leave it". We cannot amend or improve; we can only reject or approve. The Government are reluctant to withdraw measures, even when the arguments made in Committee are overwhelming. We are left a couple of weeks later with a polite note from Ministers saying that such and such a clause had an unforeseen, undesirable consequence and that they will amend it in a statutory instrument, to be tabled in due course. Such a solution is not satisfactory and makes bad use of parliamentary time.
"The increased generosity of the tax will potentially create a situation in which parents will have a clear financial incentive to obtain registered child care rather than rely on informal networks, such as friends and relatives".
There are practical problems relating to who will qualify under the eligible child care criteria. There are three contradictory views. The Chancellor, in a report in the Financial Times last year, stated that
"the Credit would only be available for registered and highly qualified child minding and child care."
However, section 71 of the Children Act 1989 states that a person who is a parent, relative, or foster parent of a child, or who has parental responsibility for a child is ineligible to be a child minder in respect of that child for the purposes of that Act.
"There is nothing to stop anyone, if they can meet the conditions, and it is not for us to make a judgment on that, if they passed the conditions in previous years."
If that interpretation is correct, the £4 billion estimate of the cost of the child care tax credit produced by the Institute for Fiscal Studies is correct. Perhaps that is the real reason why the CCTC has been left out of the Bill.
"most households, sole responsibility for meeting children's needs is the women's domain; women are more likely than men to spend the income they receive directly on the family; and income in some households is unequally distributed which disadvantages women."
I have no idea whether the hon. Lady was, in a past life, a member of the Conservative women's organisation, but she describes the dilemma of the transfer of money from the purse to the wallet.
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