APPENDIX 8
INTEGRATED CHILD CREDIT AND CHILD BENEFIT
Letter to the Chairman of the Committee
from HM Treasury (ICC 17)
Thank you for your letters of 16 January on
the Integrated Child Credit (ICC) and Child Benefit. We thought
that, given the overlap between the issues you raised, a joint
response would be the most useful.
As the Secretary of State for Social Security
said in July, it is logical that Child Benefit administration
should sit alongside Integrated Child Credit. This would help
improve delivery and reduce bureaucracy for families with children.
However, there are issues around capacity and timing which impact
on the extent to which we might want to move Child Benefit administration
and when it would be possible to do so. The Government will make
an announcement in due course.
Your letter also raises the issue of how changes
to the system of support for children will be accommodated within
the funding allocated to Inland Revenue and DSS. The Spending
Review provided resources for Inland Revenue to continue its programme
of modernising its IT systems, part of which involves the changes
needed to prepare for the new ICC. However, as you will appreciate,
breaking these down into separate and discrete streams is difficult,
especially when some of the key policy parameters underlying the
new tax credits are not yet fully determined.
As you are aware, the Spending Review created
a Welfare Modernisation Fund to start modernising DSS IT systems.
If we are to ensure that ICC and Child Benefit work together,
there must be appropriate IT support for the Child Benefit interface.
However, only when final decisions have been taken on the best
way to deliver Child Benefit alongside ICC, will it be possible
to review the overall IT and funding requirements. DSS and Inland
Revenue teams are working closely together on this work and will
continue to do so to ensure the eventual solution secures value
for money.
Dawn Primarolo
Paymaster General
Rt Hon Baroness Hollis
Parliamentary Under Secretary of State
5 March 2001
Letter to Chancellor of
the Exchequer from the Chairman of the Committee
The Committee is currently holding an inquiry
into the proposals for an Integrated Child Credit. Following the
useful evidence session in December with officials from the Treasury
and Inland Revenue, we have a number of additional questions concerning
the interface between Integrated Child Credit and Child Benefit,
which I would be grateful for your help in answering.
The gateway to ICC through Child Benefit is
clearly of crucial importance and we note that a shared database
between Inland Revenue and the Child Benefit Centre is envisaged.
However we are unclear what will be the relationship
between the Inland Revenue and the Child Benefit Centre, once
ICC has been introduced. We were advised by Treasury officials
that no final decision had yet been taken as to whether the Child
Benefit Centre will be transferred over to the Inland Revenue,
as part of the integration of Government support for children.
Can you advise us when you expect a decision to be made on this
important issue?
A second area of interest is the development
of modern computer systems to deal with ICC. The Committee would
welcome details of the funds allocated by the Inland Revenue for
the development of IT systems to support the introduction of ICC
in 2003, and to what extent these funds will also cover the modernisation
of systems at the Child Benefit Centre to allow proper integration
between ICC and Child Benefit.
I have written in similar terms to Alistair
Darling, seeking information on the proportion of funds within
the ring-fenced Welfare Modernisation Fund intended for modernising
social security delivery which will go towards updating or replacing
the computer equipment at the Child Benefit Centre in preparation
for Integrated Child Credit.
I am grateful for your help in this matter.
Archy Kirkwood MP
Chairman of the Social Security Committee
16 January 2001
Letter to the Secretary
of State, Department of Social Security from the Chairman of the
Committee
The Committee held a very useful evidence session
with officials from your Department, the Inland Revenue and Treasury
in December. One area of discussion was the interface between
Integrated Child Credit and Child Benefit. There are a few questions
arising from the discussion, which we would like to pursue.
The gateway to ICC through Child Benefit is
clearly very important and we note that a shared database between
Inland Revenue and the Child Benefit Centre is envisaged.
When we met you in July you advised us very
clearly that Child Benefit would be moved over to the Inland Revenue
as part of the ICC changes. In answer to the question "do
you see Child Benefit moving over to the Inland Revenue",
you replied "Yes. If you want to integrate it you cannot
have it run by two different Departments" (see Minutes of
Evidence, 12 July 2000, Question 15). Yet, when we met Treasury
officials in December we were told "it is one possible way
forward" and that no final decisions had yet been taken.
Can you help clarify the situation? It certainly appears logical
that Child Benefit administration should sit alongside that for
Integrated Child Credit.
You also drew attention to the fact that the
computer equipment at the Child Benefit Centre was 21 years old.
We were therefore interested in the question of modernisation
of the IT systems dealing with Child Benefit, as part of the preparations
for the introduction of ICC in 2003.
Please can you advise on what plans exist to
replace the antiquated computer systems which handle Child Benefit
with more modern IT to take account of the introduction of ICC,
and the need for better integration with Inland Revenue systems?
It would be helpful to know what proportion
of the funds within the ring-fenced Welfare Modernisation Fund
intended for modernising social security delivery will go towards
replacing the computer systems at the Child Benefit Centre as
part of the preparations for ICC.
Also, to what extent will the funds within the
Welfare Modernisation Fund intended for modernising social security
delivery take account of the greater role being given to the Inland
Revenue in the delivery of benefits, including the possible future
administration of Child Benefit?
I have written in similar terms to the Chancellor
of the Exchequer, seeking information on the funds allocated for
the development of IT within the Inland Revenue, and the proportion
which will go towards the introduction of Integrated Child Credit
and the (possible) absorption of the Child Benefit Centre into
the Revenue.
I am grateful for your help in this matter.
Archy Kirkwood MP
Chairman of the Social Security Committee
16 January 2001
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