Select Committee on Social Security First Report



1. This Report represents the third phase of the Social Security Committee's inquiry into Tax and Benefits. Our previous Reports have considered the background to policy on this complex subject and have contributed to the consultation on the Government's 1997 Pre-Budget Report.[1] The Government's intentions in this area were announced in the Budget on 17 March 1998. From October 1999, a new tax credit for working families with children — Working Families Tax Credit (WFTC) — is to be introduced to replace Family Credit. In parallel a tax credit for working people with disabilities will be introduced — Disabled Person's Tax Credit (DPTC) — which will replace Disability Working Allowance. Both WFTC and DPTC will include a new childcare tax credit and will be administered by the Inland Revenue. From April 2000 these tax credits will be payable through the wage packet. Changes were also announced to the structure of national insurance contributions (NICs) designed to make the system less regressive.[2] From April 1999, the 'entry fee', whereby a rise in earnings from £63.99 to £64 triggers a NIC charge of £1.28 for employees and £1.92 for employers, will be abolished. From the same date, the threshold for payment of NICs by employers will rise to the level of the basic personal allowance for income tax. Thereafter, the employer will pay a single rate of 12.2 per cent.

2. This phase of the inquiry looks at the practical and implementational issues arising from the Government's plans .We were assisted in the first stages of this inquiry by Mr Chris Giles, formerly of the Institute for Fiscal Studies and are grateful for the specialist assistance he gave us up to his appointment with the BBC. The Committee has taken further oral evidence; details of these witnesses are shown at page xxi. We are grateful to the witnesses and all those who have submitted written evidence.

Terms of reference

3. The Committee welcomes the Government's intention to improve the rewards of work for relatively low paid workers. Before such reforms are put in place, it is crucial that the detail of their practice and implementation is carefully considered. We are committed to ensuring that, since the WFTC is to be introduced, it should be a success. Our inquiry therefore focussed on the areas that are essential to the efficient and effective functioning of the Government's reforms and examined the issues arising from the implementation and operation of the Working Families Tax Credit, the Disabled Person's Tax Credit, the Child Care Tax Credit and changes to National Insurance Contributions as announced in the Budget of 17 March 1998. Inevitably, given the scale and fundamental nature of the changes involved, the Committee's main focus was the tax credit reforms.

Working Families Tax Credit and Disabled Person's Tax Credit


4. There are currently 767,000 families in receipt of Family Credit.[3] Annual expenditure on Family Credit in 1998/99 is estimated at £2,612 million.[4] By 2001 the Working Families Tax Credit is expected to increase the numbers eligible for in-work financial assistance by a further 400,000 and total expenditure on in-work support for working families will have risen to £5 billion, which represents nearly £1.5 billion more than Family Credit expenditure would have been by then.[5]

5. The equivalent benefit providing in-work support to people with disabilities, Disability Working Allowance, is currently paid to an estimated 17,000 people. During the current year expenditure is expected to reach £54 million. The introduction of the Disabled Person's Tax Credit is likely to lead to an increase in annual costs of between £7 million and £10 million by the year 2001/02.[6] The caseload is expected to rise by a further 10 per cent to 15 per cent.[7]

Implementation plans so far

6. The Government plans to introduce a Bill in the current session of Parliament which will allow WFTC and DPTC to be introduced from October 1999.[8] In the past, there has been a tendency in primary social security legislation to produce 'skeleton' Bills, which set out the broad framework of what is proposed but little of the detail. This 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. The Inland Revenue told us:

    "If there were to be secondary legislation on any of this, it has become our custom in recent years, certainly on things like employer legislation, to publish the detail in advance and to give people the opportunity to comment on that. An example of that is self-assessment where we published draft regulations. If there were any secondary legislation that is what we would intend to do."[9]

7. We welcome the Inland Revenue's intention to consult on secondary legislation. We recommend that the main draft regulations on WFTC and DPTC should be published and made publicly available so that all interested parties have the opportunity to comment on the detail of the measures proposed.

8. The Inland Revenue's willingness to consult with organisations regarding the detail of secondary legislation does not address the more fundamental issue of adequate Parliamentary scrutiny of major change. Even if the affirmative procedure is used (under which a Minister may make an Order only after both Houses have approved a draft), this is a 'take it or leave it' process which is one of debate, not detailed examination; and, again, amendment is not possible.

9. We therefore note the recommendation of the Procedure Committee in the last Parliament in its Report on Delegated Legislation,[10] that there should be a new category of 'super-affirmative' instruments, whose complexity and political importance warranted their detailed investigation. No progress appears to have been made on this recommendation.

10. Officials of the Benefits Agency, DSS headquarters, the Treasury and the Inland Revenue have been set a challenging task in translating the concept of WFTC and DPTC into a workable reality in time for commencement of the new system in October 1999. A second deadline of April 2000 sees the commencement of payments via the employer. It is clear that planning is still at an early stage. Officials from the Inland Revenue advised:

    "We have set up a joint project team with members from the DSS and the Inland Revenue, working closely together. Specialist work has been identified throughout both departments that needs to be done. Both departments are working closely together to scope that work, to start putting it in place and to progress the work."[11]

11. Considerable work does appear to have been done by the Inland Revenue in consulting employer representatives on the design of the scheme, with the aim of minimising extra burdens on employers. Thus, the Financial Secretary was recently able to announce the broad outline of the system for payment of WFTC and DPTC via employers.[12]

12. Other important aspects of how WFTC and DPTC will work in practice still remain to be decided. When questioned, the Treasury and Inland Revenue were unable to give answers on a range of key issues, for example, the treatment of people with more than one job;[13] methods of enforcement where an employer is reluctant to pay the tax credit;[14] the arrangements when an employee changes jobs;[15] the details of anti-fraud measures which will be incorporated into the new system;[16] and the future of payments by order book.[17] We regret that officials were not more forthcoming in discussing the range of options being considered in areas where no final decision had been made.

The implementation timetable

13. The inability of officials to give answers on such key questions at this stage gives ground for concern about the timetable for delivery. Most of the difficult questions concern aspects of the most fundamental change in the Government's reforms: the decision to pay WFTC and DPTC through the wage packet rather than as a cash social security benefit. Employer organisations have raised concerns about the proposed April 2000 starting date for such payments. The Federation of Small Businesses described the timescale as "far too quick":

The Institute of Directors thought the timetable "extremely tight",[19] a view echoed by the Confederation of British Industry which added that employers would need clear guidance on their responsibilities at least six months before April 2000 to enable the necessary changes to be made to payroll systems.[20] We recommend that the Inland Revenue should work with employers' organisations to ensure that employers are fully aware of the practical implications for them as the details of the WFTC and DPTC are finalised.

14. The Government set considerable store by the decision to pay WFTC and DPTC through the wage packet:

    "Its clear link with employment should demonstrate the rewards of work over welfare and help ensure that people move off welfare into work".[21]

Unless payment of the new tax credits through the wage packet is successful from the start, the new system runs the risk of being discredited at an early stage. The concerns of employers, coupled with the difficult questions which still have to be resolved, lead us to propose that the Inland Revenue should address with some urgency the practical difficulties of implementation within the currently proposed timetable.

Administrative readiness

15. The transition from Family Credit and Disability Working Allowance to WFTC and DPTC involves considerable change: in transferring the administration from the Benefits Agency to the Inland Revenue; in establishing new working procedures supported by IT systems; in training staff; and in creating clear and accessible information and methods of communication with the public about the new tax credit system.

16. The Department of Social Security estimates that 831,000 families will be receiving Family Credit at any one time in 1998/99.[22] Due to the increased generosity of WFTC above Family Credit, the Treasury expects a further 400,000 families to be eligible for in-work support from October 1999 onwards.[23] This is a considerable increase in workload. In addition, when visiting the Family Credit Unit at Preston, the Committee were told that there is already a surge of work every October (and every April) when a much higher number of claims are due for renewal.[24] This cycle arises from the original introduction of Family Credit in April 1988 and the regular review of many thousands of claims at regular six-month intervals ever since.

17. Officials from the Inland Revenue identified two main strategies to handle both the increase in volume of work and the likely surge of claims at what were already peak periods. The first was to use publicity to specifically target families who were likely to be eligible. The second was to draw on the existing experience of the Family Credit Unit:

    "We are working extremely closely with the Family Credit Unit. They are used to dealing with these volumes of claims because Family Credit was introduced in a similar sort of way, on a particular date, and over a similar time period. They are used to dealing in peaks and troughs of work in that way. We shall be combining the experience that we have had in both departments to tackle the peak of work that we shall get with the introduction of tax credits".[25]

18. The Committee is not wholly satisfied by these reassurances. Our Report on the introduction of Disability Living Allowance and Disability Working Allowance in 1993[26] gives a dreadful warning of the debacle which can occur when officials underestimate the surge in demand when a new benefit is introduced. Even the best targeted publicity will still result in an extra 400,000 claims. Moreover, since the introduction of Family Credit in 1988, the Family Credit Unit has never experienced such a large surge in claims. We recommend that during the first three months of WFTC only, provision should be made for new awards of Family Credit to last seven months (or 30 weeks) so that, in the future, work can be distributed more evenly throughout the year.

The role of employers

19. The Financial Secretary has recently outlined the main features of employer involvement in the payment of the new tax credits.[27] Employers will play no part in the assessment of WFTC or DPTC. Instead, the Inland Revenue will notify employers of when to start paying a tax credit, giving them time to adjust their pay roll. Employers will also be told how much tax credit to pay (including details of a daily rate), and when to stop. Employers will then add the amount of the tax credit to the employee's net wages for each pay period. Payment from the employer will cease at the end of a 26-week award, or earlier if the Inland Revenue advises the employer to stop. It will be the employee's responsibility to inform the Inland Revenue of a change of job or ending of a job. The Inland Revenue will have responsibility for paying the recipient of WFTC or DPTC at the beginning of an award, or when employment ceases during the period of an award.[28] We recommend that employers should have a legal responsibility to inform the Inland Revenue when an employee in receipt of benefits leaves their employment.

20. The Institute of Directors described to the Committee the administrative burden which the above arrangements might still involve, including entering the amount of WFTC on the payroll system; aligning the award with the pay periods; readjusting a payment at the end of the period of an award; and dealing with other employers concerning employees who have commenced employment elsewhere or been taken on part-way through the period of an award.[29] On the latter issue, the Inland Revenue told the Committee that they were still considering how to deal with employees who changed jobs, and did not have a public answer to the problems raised by employers.[30]

21. The financial implications of having to pay out the WFTC were also a major concern for the CBI:

    "The costs of administering the new credit will include making the alterations needed to payroll systems or in some cases setting up new systems, the extra time which will need to be spent by employers completing paperwork and administering additional records and notification paperwork."[31]

22. The IOD even suggested that employers would fail to recruit workers who would claim the WFTC in order to avoid the perceived administrative and financial burdens that would ensue:

    "...If I am employing a person in my office and one comes in who is maybe a woman aged 40, no family now, grown up, quite obviously not in receipt of benefit, and I have another, 20, with three children, in receipt of benefit, and I have to fund that benefit for five weeks, you are loading the dice very, very heavily against that 20-year-old."[32]

23. The issue of potential cashflow problems for some employers was also identified by a number of organisations.[33] The Institute for Fiscal Studies analysed the problem as follows:

"The WFTC will ...involve employers as effective payment agents. For most employers, this is unlikely to be a major problem — the cost of WFTC payments will be netted of the main income liability paid by the firm to the Inland Revenue on behalf of employees. Problems could arise for employers with large numbers of WFTC recipients and few non-recipients. In these cases, the company may be owed money by the Inland Revenue each month. While the actual numbers of such cases may be small, the system of payment from the Revenue to firms will have to be extremely efficient to avoid serious cash-flow problems."[34]

24. The Federation of Small Businesses told the Committee that small businesses are particularly likely to be at risk from cash flow problems:

    "...if it is not paid through PAYE, that employer can be out of pocket four or five weeks before there is the possibility of reimbursement. If it is not dealt with through the PAYE structure, at the end of the day, and maybe it is £50 or £80 to the employee, and say he has two or three employees, they arrive in the situation that they can be paying £160 a week for five weeks and without any income of any sort to cover that."[35]

25. In October, the Inland Revenue advised the Committee that "with the smaller employers who may not have sufficient liquidity, we shall simply enable them to apply to us to be put in funds in order to pay those tax credits."[36] When questioned on the timing of such payments and whether they would be made to employers in advance of payment being due to the recipient, the Inland Revenue was unable to give details of how far in advance employers would have to apply for funds, in order to have the money to pay out WFTC or DPTC when due.[37] The Inland Revenue was also unable to give details of how many employers were likely to need to avail themselves of advance funds in respect of their obligations to pay WFTC and DPTC.[38]

26. We welcome the Inland Revenue's recognition of the potential cashflow problems WFTC and DPTC might bring to some employers. Advance funds should be made available promptly on request to employers with a cashflow problem caused by the obligation to pay WFTC or DPTC. We recommend that the performance of the Inland Revenue in making prompt payments of advance WFTC or DPTC to employers should be measured against clear targets, and that details should be recorded of the number of employers who request such funds and the sums paid out by the Inland Revenue as a result. We recommend that the new payroll service for new small businesses being developed by the Inland Revenue should incorporate systems which take account of WFTC and DPTC. We recommend that small employers who administer WFTC should be awarded reimbursement of their costs similar to that which currently applies in relation to Statutory Maternity Pay, whereby small employers are entitled to an additional payment of 7 per cent of the payment of SMP.

27. The situation where a person has more than one employer poses particular difficulties. The Inland Revenue estimates that about three per cent of current Family Credit recipients are in this position.[39] So far, no decision has been taken on how WFTC or DPTC will be paid to this group. The Revenue explained that options under consideration include splitting the tax credit between the different employers, or alternatively, identifying a main employer who would pay the whole tax credit.[40] There is a third option which should be considered: paying the tax credit to the recipient when there is more than one employer. We recommend that, in cases of multiple employment, the Inland Revenue should decide with some urgency the method of payment which is to be pursued.

28. Employer cooperation is essential if WFTC and DPTC are going to work. The Inland Revenue is working hard to iron out employers' difficulties and to support them in getting the new tax credit payments right. But there will inevitably be a minority of employers who are reluctant to deal with the Inland Revenue. Families who are eligible for WFTC or DPTC could find that they are denied payment as a result. The National Association of Citizens Advice Bureaux (NACAB) gave a number of examples in its written evidence[41] of problems which already exist of employers being slow to confirm wages or future hours of work, or failing to provide wage slips. Employees can be reluctant to complain for fear of losing their job. The Inland Revenue told the Committee that employer non-cooperation was "one of our key concerns".[42] Officials were unable to give the Committee any details of measures to enforce compliance of payment of WFTC or DPTC where an employer fails to pay sums due accurately and on time. The Inland Revenue intends to draw on the experience of the Benefits Agency and Contributions Agency in tackling employers who fail to pay statutory sick pay or statutory maternity pay.[43]

29. The new role of the Inland Revenue in monitoring and enforcing compliance by employers in connection with payment of WFTC or DPTC appears to mirror another new area of responsibility: the monitoring and enforcement of the National Minimum Wage. There would appear to be scope for combining scrutiny of employers for both purposes, given the inevitable overlap between the two areas. We recommend that the Inland Revenue should combine its enforcement functions in relation to the National Minimum Wage legislation with the obligation to pay WFTC and DPTC.

30. Voluntary cooperation of employers in operating WFTC and DPTC may prove to be the best means of ensuring that the new system is effective. We recommend that active steps should be taken by the Inland Revenue in the coming year to increase employers' awareness of their obligations to pay WFTC and DPTC and the benefits of compliance.

31. Poor employers who persistently deny their employees the benefits which WFTC and DPTC are intended to bring should be penalised. We recommend that the Inland Revenue should be given powers to levy 'compensation orders' on employers who consistently fail to cooperate in the payment of WFTC or DPTC.

32. It is vital that the amount of WFTC or DPTC paid by an employer is absolutely transparent to the employee, so that they can check it, if necessary, with the Inland Revenue. We recommend that the statutory obligation which requires employers to provide an itemised payslip should be extended to require the specific inclusion of information relating to the gross income tax due and the total tax credit payable.

Improving work incentives

33. Perhaps the most fundamental change of the Government's reforms in structural terms is the decision to pay the WFTC and DPTC through the wage packet rather than as a cash social security benefit. The Government believes that a number of positive consequences will flow from this move:

34. Mr Martin Taylor agreed with this analysis in his oral evidence to the Committee, although he was prepared to admit that the case was not proven:

    "As far as stigma goes, the hard and fast evidence in all these non-financial and psychological matters is difficult to come by. There is a good deal of anecdotal evidence collected by sociologists and indeed by lobby groups on these issues. Certainly my exposure to the literature and I also think just every day imagination has persuaded me that the drivers in these cases are not purely financial. I think people are deeply influenced by all sorts of behavioural characteristics as well. The principal psychological assertion, and I is an assertion; it is not proven; is that the association of this payment with work rather than with the Benefits Agency will change the way people think about it. I am just as attached to the idea that associating it with the fact of working is a positive change as that taking it away from the welfare system is the removal of a negative".[45]

35. In forwarding details of the literature considered by the Tax and Benefits Task Force in reaching this conclusion Mr Taylor accepted that "we are dealing with intuition rather than scientific proof".[46]

36. Other witnesses hostile to the concept were sceptical of the behavioural impact of payment via the wage packet. The Institute of Directors thought there would be no perceived reduction in the stigma, given that people would still have to apply for the credit, and it would appear on the payslip as "a handout".[47] The Federation of Small Businesses thought there might be an added stigma for employees would be more likely to be identified as benefit recipients by work colleagues as a result of being paid through the wage packet.[48] However, the Institute for Fiscal Studies concluded that the impact of the main structural difference between WFTC and Family Credit — that the Government money involved will pass through employers' accounts and the wage packet before reaching families rather than being paid direct — hinged on the impact on behaviour but "there is no hard evidence on the importance or direction of such effects".[49]

37. The improved work incentive effects of WFTC and DPTC may well lie in the increased generosity of the financial assistance being offered to families and disabled people in low paid employment. The new tax credits are a central part of the Government's strategy of making work pay. The new tax credit system for families will give approximately £1.5 billion more in-work support than Family Credit. Key improvements to present in-work help include a substantial increase in the income level at which maximum payments are made; the introduction of a childcare tax credit which, unlike the Family Credit childcare disregard, will benefit the poorest families; and a reduction in the rate at which in-work financial help is withdrawn as income rises, from 70 per cent to 55 per cent.

38. The increased generosity of WFTC and DPTC should reduce the numbers of people caught in the 'unemployment trap' — an issue discussed in our First Report — whereby people are little or no better-off in work than if they remained out of work and on benefits.[50] However, important qualifications must be made. The level of a household's housing costs can be a key factor in determining whether a job will bring greater prosperity. Home-owners in particular can face problems because, unlike tenants, they are immediately responsible for the whole of their mortgage payments when they start work even if the job is low paid. Professor Steve Wilcox of the Centre for Housing Policy at York University concluded that, on its own, the tax credit scheme is only sufficient to ensure that home buyers with very limited mortgages are better off in paid work.[51]

39. WFTC and DPTC are also intended to reward work better by reducing the impact of the 'poverty trap', caused when the combination of tax and the withdrawal of benefit leads to a person being only maaaaaaaaaarginally better off from an increase in gross income.[52] This has been done mainly by reducing the rate of tapered withdrawal of the credit as income rises from 70 per cent to 55 per cent, as well increasing the withdrawal threshold and the level of child credits.

40. As many of the groups who responded to the Committee's inquiry pointed out, the impact of WFTC and DPTC on marginal tax rates is fairly limited for people who claim Housing Benefit. The Institute for Fiscal Studies calculated that, for people subject to tax and national insurance deductions, and in receipt of Family Credit, Housing Benefit and Council Tax Benefit, the introduction of WFTC would reduce their marginal tax rate from 96.9 per cent to 95.3 per cent. For people in the same position but not receiving Council Tax Benefit, their marginal tax rate would fall from 92.7 per cent to 89 per cent.[53] Professor Steve Wilcox of the Centre for Housing Policy concluded:

    "The greatest weakness of the reform proposals to date, however, is that for many households with higher rents the confusing overlap of the different in-work benefits remains in place. Such households are as a result no more likely to take account of the potential for housing benefit to boost their in-work incomes than they are now. So for high housing households the 'work pays' message will not be effectively delivered."[54]

41. Our Third Report of 1997-98 concluded the evidence taken by the Committee during the first two phases of our inquiry made a compelling case that Housing Benefit was central to the problems of welfare dependency, workless households and the poverty and unemployment traps. We warned that the Government's reforms of tax and benefits might be jeopardised unless Housing Benefit was fully taken into account.[55] The Chancellor's latest Pre-Budget Report acknowledges that, although WFTC will reduce the disincentives caused by the combination of Housing Benefit and Family Credit, reform of Housing Benefit is also necessary. As a first step, the Government is working with local authority associations to make Housing Benefit easier to claimants to understand; to make the benefit fairer; and to tackle fraud and abuse.[56] We repeat the recommendation made in our previous Report that the Government should place a high priority on reform of Housing Benefit as part of its strategy of welfare to work and reform of social security. We further urge the Government to consider ways of assisting home-owners in low paid work.

42. Another issue affecting the 'better-off' calculation between out-of-work and in-work incomes is the question of access to various 'passported' benefits. At present, recipients of Family Credit and Disability Working Allowance and their families are automatically entitled free prescriptions and free dental treatment; social fund payments for maternity and funeral expenses; and free legal advice and assistance. Disabled people in receipt of Disability Working Allowance also qualify for higher premiums paid with means-tested benefits including Housing Benefit and Council Tax Benefit. The Inland Revenue were unable to say whether these 'passported' benefits would be transferred to WFTC and DPTC.[57] Yet, particularly in the case of disabled people, the cost of prescriptions might well be an important factor in deciding whether it is worthwhile to take a low paid job. The increased in-work help which has been promised by the Chancellor would be undermined if recipients of WFTC and DPTC had to make up the loss of 'passported' benefits from their increased take-home pay. We recommend that the 'passported' benefits which can be accessed at present through receipt of Family Credit or Disability Working Allowance should also be made available to recipients of WFTC and DPTC.

43. Under the present system, free school meals are not a 'passported' benefit for recipients of Family Credit or Disability Working Allowance.[58] Yet, for parents in receipt of Income Support or Jobseeker's Allowance who have a number of school-age children, the cost of school meals is a significant deterrent to taking a low paid job. For a family with two school-age children, for example, free school dinners are worth in the region of £350 a year. Clearly, the increased generosity of WFTC and DPTC will mitigate the extra expense of school meals for parents making the transition from unemployment into work; but there is likely to be an important psychological benefit at the point of transition if a parent has the security of knowing that the family will not have to face the extra expense of school meals immediately. Therefore there are strong arguments for extending entitlement to free school meals to families at the point when they make their first claim for WFTC or DPTC after starting a job. Although entitlement to free school meals would not be carried over into renewal claims for WFTC or DPTC, it is likely that the parent will be better established in work at that point. We recommend that eligibility for free school meals should be extended to families who are awarded WFTC or DPTC, who have been in receipt of Income Support or Jobseeker's Allowance in the period immediately preceding the award.

44. For Family Credit, £15 of any child support paid is disregarded. We recommend that the current child support disregard for Family Credit should at least be maintained within WFTC and DPTC in real terms. We also recommend that consideration be given to disregarding Child Support payments up to the level of the anticipated average maintenance payment of £29 per week.

1   First Report from the Social Security Committee, Session 1997-98, Tax and Benefits: An Interim Report, HC 283; and Third Report from the Social Security Committee, Session 1997-98, Tax and Benefits: Pre-Budget Report, HC 423. Back

2   New Ambitions for Britain, Financial Statement and Budget Report, HM Treasury, HC 620, March 1998.  Back

3   Family Credit Quarterly Statistics, DSS, May 1998. Back

4   Social Security Departmental Report, The Government's Expenditure Plans 1998/99, Cm 3913, April 1998. Back

5   New Ambitions for Britain, Financial Statement and Budget Report, HM Treasury, HC 620, March 1998. Back

6   HC Deb, 2 April 1998, vol 309 col 617w. Back

7   HC Deb, 2 April 1998, vol 309 col 617w. Back

8   HC Deb, 24 November 1998, vol 321 col 5. Back

9   Q. 203. Back

10   Fourth Report from the Select Committee on Procedure, Session 1995-96, Delegated Legislation, HC 152, para 9. The Procedure Committee suggested that a procedure similar to the deregulation procedure could be used for such instruments. Deregulation Orders are first submitted to both Houses in the form of Minister's proposals, which are then scrutinised in detail, both as to their drafting and effect, by Committees of both Houses. Relevant interest groups and people who may be affected, give oral and written evidence. In this House the Committee judges the proposals against a set of criteria which include the adequacy of public consultation. The Minister may make the Order only after the conclusion of the Parliamentary process, and must take full account of any amendments recommended by the Committee in each House. The draft Order is then formally laid for consideration as an affirmative instrument. Back

11   Q. 200. Back

12   HC Deb, 27 October 1998, vol 318 col 9-2w. Back

13   Q. 232. Back

14   Q. 243. Back

15   Q. 248-9. Back

16   Q. 280-1, Q 286, Q. 293. Back

17   Q. 31-11. Back

18   Q. 82. Back

19   Q. 82. Back

20   Appendix 13. Back

21   The Modernisation of Britain's Tax and Benefit System, Number Three, The Working Families Tax Credit and Work Incentives, HM Treasury, March 1998. Back

22   Social Security Departmental Report, The Government's Expenditure Plans 1998/99, Cm 3913, April 1998. Back

23   The Modernisation of Britain's Tax and Benefit System, Number Three, The Working Families Tax Credit and Work Incentives, HM Treasury, March 1998. Back

24   Appendix 15. Back

25   Q. 215. Back

26   Third Report from Social Security Committee, Session 1992-93, Disability Benefits: The Delivery of Disability Living Allowance and Disability Working Allowance, HC 284-I. Back

27   HC Deb, 27 October 1998, vol 318 col 91-2w. Back

28   HC Deb, 27 October 1998, vol 318 col 91-2w. Back

29   Q. 109. Back

30   Q. 249. Back

31   Appendix 13. Back

32   Q. 107. Back

33   Federation of Small Businesses Ev.p.17-18, Institute of Directors Ev.p.13-16, Confederation of British Industry Appendix 13. Back

34   Appendix 6. Back

35   Q. 97. Back

36   Q. 220. Back

37   Q. 224. Back

38   Q. 227-9. Back

39   Q. 233. Back

40   Q. 233-4. Back

41   Appendix 8. Back

42   Q. 243. Back

43   Q. 243. Back

44   The Modernisation of Britain's Tax and Benefit System, Number Three, The Working Families Tax Credit and Work Incentives, HM Treasury, March 1998, Paragraph 2.09. Back

45   Q. 11. Back

46   Appendix 14. Back

47   Q. 75. Q. 84. Back

48   Q. 75. Back

49   Appendix 6. Back

50   First Report from the Social Security Committee, Session 1997-98, Tax and Benefits: An Interim Report, HC 283. Back

51   Appendix 12. Back

52   See First Report of the Social Security Committee, Session 1997-98, Tax and Benefits: An Interim Report, HC 283, para. 8. Back

53   Appendix 6. Back

54   Appendix 11. Back

55   HC 423, para 13. Back

56   Pre-Budget Report, HM Treasury, Cm 4076, November 1998, para 4.44. Back

57   Q. 271.  Back

58   Q.274-6. Back

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