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Dawn Primarolo: I am grateful for the hon. Gentleman's comment. I am not convinced that he is correct about the reference. He may well be, but, in any case, I am happy to give him the assurance that he seeks. I shall be speaking during the evening, and I shall give the reference to the House, as he requests.
The accreditation scheme will be United Kingdom- wide, just as the tax credits are United Kingdom-wide, but the regulations will be made after consultation with colleagues in Scotland, Wales and Northern Ireland. As is proper for issues relating to regulations for child care, the scheme will be administered separately in Scotland,
Wales and Northern Ireland, using a common set of rules which, as the clause makes clear, can reflect specific national or regional needs.
We believe that that is an important extension of the categories of child care eligible for child care tax credit. It fills a practical gap in the current rules, as was clearly identified in Committee and elsewhere. I commend new clause 5 to the House.
New clauses 2 and 3 are grouped with new clause 5. The measures that new clause 2 calls for have already been taken. It calls for us to publish the eligibility criteria, which has been done in the regulations. It also calls on us to publish the conditions for registration as a child minder, which is not for the Treasury or the Inland Revenue to do, but is done by local authorities on the basis of published guidance from the Department for Education and Employment. Therefore, new clause 2 is not necessary.
With respect, new clause 3 looks at the problem from the wrong end. It asks us to publish guidance about the eligibility of people listed in the Children Act 1989 as those who do not need to register as child minders to care for their children, but our rules operate to consider the type of care that is provided and whether it is one of the types that will qualify.
If such people are registered child minders they get over the first hurdle, but further rules prevent the churning of payments within households, which has been referred to in Committee. That obviously stops the abuse, which has so concerned many members of the Committee, and I therefore ask the House to reject new clauses 2 and 3 and to vote for Government new clause 5.
Mr. Pickles:
What a pleasure it is to hear the Paymaster General in full voice. She was a little indisposed in Committee and lost her voice, which is a cruel and unusual punishment for a politician, so it is nice to hear her in good voice today.
Dawn Primarolo:
It is a pleasure to sit opposite the hon. Gentleman, who always behaves as such. I am grateful for the kind views that he expressed in Committee, especially when he asked me to leave so that I did not give him the flu. That was said, however, with the best of intentions and my recovery was helped by knowing how much he wanted me to get well.
Mr. Deputy Speaker (Sir Alan Haselhurst):
Order. This is all very touching, and I hope that we feel a great deal better for it, but may we return to discussing the Bill?
Mr. Pickles:
Indeed, but I am afraid that we are like that, Mr. Deputy Speaker; we are fairly chummy. I can recall--
Mr. Bercow:
This is the cuddly Conservative party.
Mr. Pickles:
I have no objection to that description.
On the day that the Bill was published, I remember waking to the melodious tones of the Paymaster General, who was on the BBC's "Today" programme. She said, "The really important element for women is the presence of the child care tax credit." So, with some enthusiasm, my hon. Friend the Member for Bognor Regis and
Littlehampton (Mr. Gibb) and I reached for the Bill to look for the child care tax credit. Could we find a reference to child care rates? Sadly, we could not. The absence of any such reference was a matter of contention on Second Reading and remained a matter of contention in Committee. The child care tax credit is the tax credit which dare not speak its name.
We were told that it was not necessary to amend the Bill to include the child care tax credit and that everything would be taken care of through regulations, so it is not surprising that we regard the Government new clause as something of a victory, particularly for my hon. Friend the Member for Beckenham (Mrs. Lait), who raised the matter consistently in Committee.
How can we consider how the credit will operate when no regulations have been published and we have no real knowledge of what will happen? We are told that by the time the regulations are published, the Bill will have gone to the other place, which will have the benefit of considering the legislation. Although hon. Members voted yesterday to abolish certain people's membership of the other place, they place enormous trust in them in this respect.
Many questions remain unanswered. Is it still the Government's contention that the measure will cost £200 million, as they have so optimistically suggested, or will it cost £4 billion, as the Institute for Fiscal Studies has suggested? It remains a question of eligibility and take-up. The new clause seeks to give more regulation-making powers to the Secretary of State to establish a new category of claimant, whose child care charges can be taken into account when calculating entitlement to working families tax credit and disabled persons tax credit.
I had an opportunity to read the memorandum produced by the Inland Revenue, which makes it clear that the Government intend to expand the definition of eligibility to child care for children over the age of eight. As is so often the case, we shall have to wait a long time for the regulations to understand exactly what will happen. We do not know about the new quality assurance measures for those concerned; nor are we clear who will carry out or pay for those inspections. We are told that the trained independent quality assessors mentioned in the memorandum will be the responsibility of the Department for Education and Employment.
We know that registration of child care for children under the age of eight comes under the Children Act 1989 and is the responsibility of local authorities. The Paymaster General said that there would now be two forms of registration: one for children over the age of eight, and another for children under the age of eight. It would be helpful if she would say whether the Government intend gradually to relieve local authorities of their responsibility in that regard. If not, this measure will be a further burden on those authorities.
There remains the question of eligibility and take-up. The current arrangement under family credit operates by way of disregard rather than cash payment. Cash payment is a much more attractive way to receive a credit. It is therefore not surprising that the House of Commons Library has said:
The Financial Secretary to the Treasury (Mrs. Barbara Roche):
The hon. Gentleman knows that I would never dare tick him off, but we had a number of exchanges in Committee on the subject. I said that, in relation to behaviour, the determining factor for parents choosing child care was the best interests of their child. That is the key underlying point. That is the message which was sent by Labour Members, not only on Second Reading, but throughout the Committee stage. I am sure that the hon. Gentleman will confirm that.
"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".
The Committee spent a lot of time discussing eligibility. The evidence was conflicting. We know the position with regard to section 71 of the Children Act 1989. In response to a question by my hon. Friend the Member for Bromsgrove (Miss Kirkbride) about whether a child's mother could become a registered child minder, the assistant director of the personal taxation division at the Inland Revenue stated before the Social Security Select Committee:
"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."
On 9 February, the Financial Secretary said:
"Parents and relatives, including grandparents, can register as child minders, but family credit legislation does not consider payment between partners to be a relevant child care charge. That provision will be incorporated into the rules governing the working families tax credit."
I asked the hon. Lady a simple question: was not the difference between what the Government were saying and what the Institute for Fiscal Studies was saying a question of human behaviour? She replied that it was. I have the quotation before me. Does she want me to read it out? I said:
"Would it be fair to say . . . that the difference between the IFS estimate and the Government's estimate is a difference in the understanding of the way in which human nature operates?"
She replied:
"I understand the point that the hon. Gentleman is making. I would have more regard for it if Opposition Members had made the same points about family credit legislation, but they did not."--[Official Report, Standing Committee D, 9 February 1999; c. 83-85.]
I accept the ticking off. She is right, but the point is nevertheless a good one.
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