Wider context
6. Alongside ICC a new 'Employment Tax Credit' (ETC)
will be created, which unlike Working Families Tax Credit (WFTC),
will be payable to people without children as well as those with
children. The objectives of the ETC will be to increase work incentives
for low-paid workers by ensuring that they are better off in work
than on benefit; and to relieve in-work poverty. The introduction
of ICC and ETC in 2003 will take place against a background of
considerable organisational change affecting significant parts
of benefits and tax credits administration. During the financial
year 2001- 2002, the work of the Employment Service and those
parts of the Benefits Agency dealing with people of working age
will be brought together in a new agency dealing with people of
working age. The Minister of State for Social Security has described
the change as "probably one of the biggest changes ever to
be made in the machinery of government...Extracting the Employment
Service and the Benefits Agency from the general system, enabling
them to deal with a specific client group, is almost like planning
a new Government Department. It will not be a five-minute job;
it will take several years."[5]
A separate centralised agency or "Mini-ministry"[6]
dealing with all aspects of pensions and pensions policy, including
the creating of a new 'pension credit,' will also come into existence
in 2001-2002. The full administrative implications of these changes,
involving the break-up of the Department of Social Security's
largest agency, the Benefits Agency, are still being worked through.
Parallel to these major changes is the introduction of fundamental
reforms to the child support scheme from 2002. This will affect
the work of the Child Support Agency, as well as creating knock-on
implications for Income Support (IS) and Jobseeker's Allowance
(JSA). Underlying all these changes is an immense programme of
replacement of outdated information technology (IT) systems in
the DSS, designed to eliminate benefit 'chimneys' and create a
more integrated approach across benefits. One of the key questions
is how all these changes will interact and be co-ordinated.
1 
