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Phil Hope: That is an excellent point. We are doing the right thing in the Bill by seeking to meet the needs of people in most need. It will provide not a handout, but a hand-up. These measures will provide people with the building blocks to move themselves out of the poverty into which the Conservatives seemed so casually to throw them.
The impact of measures that we have already taken has been significant. Lone parents have come up to me as I have been walking through the town centre just to say, "Thank you." They are doing their shopping with their
kids in the buggy and they come over and say, "Mr. Hope, I just want to say that, for the first time, I have got a job." That actually happens.
The Financial Secretary to the Treasury (Mr. Paul Boateng) indicated assent.
Phil Hope: My right hon. Friend was with me when that happened and thought that I had set it up for his visit, but it was spontaneous. People are now, for the first time, on the ladder of opportunity that we have provided. That is especially true for young women who left school early and had their babies early. For the first time, they have access to child care and financial support, and that has helped them to start to reconnect to their communities and develop relationships with friends and colleagues who can help them out. Community regeneration starts in that way, and that shows that the Bill is not just about money. It is about bringing people together and finding ways to lift them out of poverty.
Tony Cunningham (Workington): In my constituency, generations of people have not only not worked but have had no opportunity of, or aspiration towards, further or higher education. It is not just work that is important. The Bill will give people the opportunity to take a job and obtain training and education themselves, and their children will see how important it is to have a job and to go on to further education. I taught in my constituency for many years and many young people did GCSEs but never went any further. They never thought of further education or university as being for them. The Bill will change that for many children, and that is just as important as its other proposals.
Phil Hope: My hon. Friend is right, and the passion with which he speaks illustrates all too well why Labour Members are here debating this issue and why Tory Members are all too obviously absent. The people we represent find that these measures lift their hearts, aspirations and expectations. We talked in the general election about supporting the many and not the few. These measures are for the few among the many who so often get overlooked. They are the bottom 10 per cent. to 15 per cent. who live in difficult circumstances and who have not had a decent education. They and their children live in disadvantaged areas, but if we can bring together the support contained in the sure start programme, the education action zones, the neighbourhood renewal funds and the new deal for communities—
Mr. Deputy Speaker: Order. I remind the hon. Gentleman that we are debating the Tax Credits Bill. I have brought that to the hon. Gentleman's attention before and he should now address his remarks to that subject.
Phil Hope: As I was about to say, poverty is not just about money. It is about the lack of all the other opportunities. However, money is crucial, and the Bill will give families the cash they need. It will provide the means to get the resources to those who do not have them.
The new child tax credit is important, because it contains extra elements for particular children. For example, it has a higher element for children under one year of age. I know that the most painful time financially
for parents is the first 12 months of a child's life. The mother has not gone back to work and the family does not have everything it needs, be it a pram or the other necessities for bringing up a baby. The extra amount for that first year will be vital. As other hon. Members have pointed out, the fact that it will be paid to the carer is a vital factor in the successful targeting of the measure. The regulatory impact assessment suggests that 5 million families will benefit from the measure. We are removing the stigma from obtaining benefits for a low-income family, and that is vital in regenerating individuals, families and communities. We do not want the negative stereotyping and stigmatising of lone parents; we want people to have the money they need to bring up their children.The working tax credit is important, because it extends support from those with children who work to those at work without children. The regulatory impact assessment suggests that 400,000 individuals will benefit. That is vital, because we want to help people out of the unemployment trap. Someone who is unemployed and has no children should have an incentive to get back into work and get on the ladder of opportunity.
I note that the extra cash will go to workers in low-income households who are aged 25 or over, and the hon. Member for Northavon (Mr. Webb) wondered whether that was targeted correctly. My understanding is that it is targeted on the older age group because they find it hardest to get back into work. I have campaigned heavily on youth issues in this Parliament, and I know that young people under 25 do not stay on low incomes for long. None the less, I am nervous about creating another age break in a system where someone who is 18 is considered an adult. I have argued this point also in relation to the national minimum wage and the right to vote.
Education maintenance allowances are not affected directly by the Bill, but there is a link. Where 16 to 18-years-olds in pilot areas have received the allowances, they have stayed on in education a lot longer. I would like that scheme to be extended to Corby, if I may put down a marker for Ministers. If we can encourage young people to stay on in school, they can get a higher-paid job and can start to benefit from the working tax credit.
I wish to refer to fraud. I am a former member of the Public Accounts Committee, which had an annual ritual in which representatives of the Benefits Agency would be slapped round the ears and sent on their way for failing to make the system work well. I hope that under the system of tax credits, using the Inland Revenue, we may see a reduction in the error and fraud that have bedevilled the system under Administrations of both parties.
Child care is a barrier in terms of parents getting to work, and reference has been made to the problems of child care in rural areas. My constituency contains the town of Corby, as well as a rural area of 60 villages. They have established a system of co-operation between very small playgroups in small villages, through which they pass on items of equipment and joint training takes place. This indicates that the child care tax credit can help to provide new services for such groups. That can reduce the isolation felt by many young parents who are bringing up a child on their own in a small village.
On passporting benefits, it is important that people receiving a means-tested benefit under the old system which then entitled them to another benefit should not
lose these benefits. The new system must protect people's passports to those additional benefits. One example is the sure start maternity grant. I have a sure start programme in my constituency, and it is astonishingly successful at supporting parents in the poorest areas. Those individuals can now claim the grant, and I hope the new system will protect the benefit.I have mentioned a panoply of measures in which the Bill plays a part, but what counts when one is poor is cash. We know the impact of taking money away from people; we saw that under the long, bleak, 18 years of Conservative rule. We are now seeing a new commitment to people in our constituencies.
David Taylor (North-West Leicestershire): I have been fascinated by the strong and sound case that my hon. Friend is making. However, has he had contact with the small employers in his constituency on whom falls a disproportionate burden in relation to the operation of the tax credit system in all its glory? There is a problem, and I would appreciate my hon. Friend giving some thought to it before he concludes.
Phil Hope: I know of the support that my hon. Friend gives to small businesses in his constituency, which provide a vital source of employment for so many people. I can reassure him that the regulatory impact assessment on the Bill shows that the new scheme will cost employers £10 million less than the current arrangements. Going over to an annual cycle will reduce the cost by some £9.5 million; not having to issue a certificate of payment will save some £400,000; and not having to issue an earnings inquiry form will save £1.1 million. If my mathematics serves me right, that comes to savings of about £11 million, rather than £10 million. [Interruption.] I picked that figure up from the hon. Member for Northavon, and now I remember the old adage—in Corby, anyway—about never trusting a Liberal Democrat's figures.
In conclusion, some impassioned speeches and important interventions have been made today. We are committed to tackling poverty in this party and in government. We have already made a substantial change to people's lives. The Bill is another major step along the historic route to halving and eventually eliminating poverty in the United Kingdom.
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