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Mr. Archy Kirkwood (Roxburgh and Berwickshire): I am delighted to follow the hon. Member for Bolton, North-East (Mr. Crausby); the whole House is better informed because of his experience and knowledge of, and expertise in, the subject.
This has been a very good debate, in which many very good and positive points have been made. The debate will have been well worth while, if the Secretary of State is as good as his word, and if the Government are serious about taking on board some of positive points that have been made by hon. Members on both sides of the House--certainly the Under-Secretary of State for Social Security, Baroness Hollis has been at pains to consult widely, and that is much appreciated; I am chairman of the Social Security Committee, which has had the benefit of much of her time and energy, for which we thank her.
I should like to start with a procedural point, and expand a bit on the comments of the hon. Member for Thurrock (Mr. Mackinlay) on how the Bill has been constructed. Although many points have been made in the debate, no one has yet dwelt on procedural matters.
First, although the Minister of State is a seasoned hand in the legislative stakes, procedurally, the Bill is a dog's breakfast. There should have been two Bills, and the whole House would have been better informed if we had had two half-day debates, with two shorter Standing Committees--I am not asking for more Government time. Had that been done, the debate would have been much more coherent.
Secondly, it is madness to interleave new legislation into the Child Support Act 1991, as it will make the legislation--if anyone understood it in the first place--totally incomprehensible.
Thirdly, clause 27 is entirely redolent of the 1991 Act. Even the notes produced by the Government describe wide-ranging discretionary powers, all exercisable in negative procedure resolutions. None of the resolutions will use the affirmative procedure, so that they will have to be dealt with in prayers. We have been there before. In 1991, when the Child Support Agency was established, the damage was done in the secondary legislation--and here we go again.
Clause 27 is, therefore, offensive. The Government really must understand that, if they are to win the confidence of the House, never mind anyone outside it, they will have to fall over backwards to ensure particularly that the House knows what is going on and when, and that they keep us advised appropriately.
Fourthly--my hon. Friend the Member for Northavon (Mr. Webb) made passing reference to this--it is offensive to invite the House to examine on Second Reading the principle behind important and far-reaching legislation on the state second pension--the consultation period on which ends in three days--without any access to a coherent overview of the results of that consultation process.
I do not blame Ministers for that, because I know that the business managers are a pretty draconian bunch to try to win arguments over. Nevertheless, from a parliamentary point of view--I am not making any party points at all--the legislation should have been handled in an entirely different manner. Indeed, the parliamentary draftsman should be brought to book. There is an
argument that the Government are introducing too much legislation and the draftsmen cannot cope with it, but I do not have time to address that. Given that the Government are introducing a large volume of legislation at such a rate, the House of Commons deserves better information and a better legislative process in respect of these important measures. However, I shall let that pass.
As Chairman of the Social Security Committee, I acknowledge that the Department helped us enormously with the three-day evidence session and that Baroness Hollis made absolutely every effort to give us all the information.
As one or two of the points that I wanted to make have already been covered, I shall turn to the ones that have not. I am sceptical about the value and the accuracy of the regulatory impact statement. It is far too optimistic about the effects on business. The point has been made that we shall have to toil through the transitional arrangements. The deduction of earnings orders and the new criminal sanctions that can be visited on business people if they actively withhold information will also produce difficulties. If the enforcement that we anticipate under the new regime is not carried out carefully, small businesses in particular will have to make a great deal of extra effort for no return. I counsel the Government to be extremely careful. I hope that I am wrong, but I think that the obligations on businesses will be onerous and that the regulatory impact statement is optimistic.
Like everyone else, I welcome the simplified formula for the child maintenance premium, the disregard and the working families tax credit exemption. I did not know until the Select Committee took evidence that people receiving working families tax credit who are on housing or council tax benefit are entitled only to a £15 disregard because housing benefit and council tax will take anything over £15. That is likely to create an awful lot of anxiety and a great deal of constituency casework, so we should examine it carefully in Committee.
My biggest worry about the Bill is that, while the Government have been assiduous about trying to work out the cost of a child--although the evidence is pretty thin and they did not manage to persuade me that their calculations were accurate--nobody has looked at the ability to pay. The right hon. Member for Birkenhead (Mr. Field) also made this point. Paragraph 17 of the Select Committee report and its first recommendation are extremely important. If that recommendation were accepted as an amendment, I would be persuaded to vote for the Bill. The Select Committee recommends that the Government should remove the set formula rates from primary legislation and put them into secondary legislation so that they can be changed if they are found not to be right.
Creating new legal liabilities does not generate new resources. When families split, no extra money is generated. Of course there are people who are swinging the lead, and I want to attack them as robustly as everyone else does, but I do not think that we understand the extent of people's debts. I am talking not about earnings or proportions, but about debts such as store cards and credit cards. Many people have a huge overhang of debt which they cannot cope with, and although, in principle, 25 per cent. of one's income does not seem too much to pay for one's children, for some it is an impossible demand.
The Bill includes draconian methods of enforcement. The chief executive of the CSA plans to reverse the balance of its work from 10 per cent. enforcement and 90 per cent. calculation and assessment so that 10 per cent. of its work will be devoted to calculation and assessment and the rest of the £230 million operation will be put into enforcement. If the CSA enforces the legislation by imposing fixed penalties and taking away people's driving licences, it will create an even bigger bogeyman. It will have to be extremely careful about how it implements some of the measures and make sure that it is not simply recycling money by taking it away from people who are very poor to give it to people who are even poorer. That would not be in anyone's interests.
I should mention two important points that the Government must take on board in Committee. First, to take £5 from people who are on benefit, income support or income-based jobseeker's allowance and to make that a flat-rate payment may be right in principle--it is a difficult judgment to make. However, hon. Members who have not studied the matter in detail may not understand that, when people on income support lose £5, another family on benefit will be even worse off.
Income support levels are not sustainable in the long term and some second families are on income support for years. To take £5 from them and to threaten them with fixed penalties, taking away their driving licences and sending them to prison is contrary to natural justice. We have to keep the position in balance. The proposals can all be justified on paper and in an ideal world they are right. Like everyone else, I want people to get the benefit to which they are entitled, but we have to be careful; otherwise, we might make the situation worse. One third of those who are supposed to be paying the CSA are hiding because the organisation is so inefficient that it cannot find them. If the new, efficient regime works, it will create great difficulties.
The transitional process will be extremely difficult. I want to leave the Government with one thought--hon. Members may be interested in this. One of the most compelling pieces of evidence to the Select Committee came from John Avery, the Deputy Parliamentary Commissioner for Administration, who has been on the receiving end of many of those difficulties. I quote from the memorandum that he submitted to the Select Committee. He wrote:
"Simplifying the system should make its administration more straightforward but, even with a simplified system, unless there are enough staff and the staff have the necessary support facilities, training and instruction or guidance, and the time in which to absorb that training or guidance, the problems which have characterised the Child Support Agency's first six years will continue."
That is true. The CSA is facing an increasing case load at the moment. I know that the Government are introducing a new IT system. I support that, and I think that it is necessary to get it in place as fast as possible. However, if we do not put resources into the transitional process in particular and the stage-by-stage evolution of that process is not made absolutely clear to everyone early on so that we have answers to the difficult questions that will come to our surgeries, the transitional process might make the situation almost unbearable.
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