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Dawn Primarolo: With the leave of the House, I shall respond to the points that have been raised.
The Government consulted widely on the Bill, which is far better as a result. We continued to undertake consultation, and then moved these amendments. Lord Higgins's complaint was that we tabled them.
Mr. Flight: The Government tabled them late.
Dawn Primarolo: No, we did not table them late. The lesson mentioned by the hon. Member for Northavon (Mr. Webb) involves Governments who want to ensure that legislation going through the House is subject to constant scrutiny. This is a complex Bill, but it would have operated without the changes suggested in the amendments. The Government are very grateful for the continued contribution made by the experts involved. They have made the Bill better as a result, but we had to decide whether to table the amendments.
The other problem has to do with the point made by the hon. Member for Northavon—that the Bill has been eagerly anticipated by our constituents. Before the Government can put in place the apparatus for advice and support in connection with the Bill, and before we can publish the details about it, we need the House to agree it. I deeply regret that the amendments were tabled at such short notice in the other place. I should have preferred to avoid that, but they were purely technical in nature and everyone—including Lord Higgins and Lord Russell, who was extremely supportive and generous—agreed that the Bill would be improved by them. In the light of that, it would be a very poor House of Parliament—Commons or Lords—that stood on procedure and prevented the amendments from being agreed and improving the Bill.
I accept that inconvenience was caused to the House of Lords, but the situation is not unique. The previous Conservative Government often tabled, at the last minute, matters of substance in the other place. These amendments do not change the substance of the Bill, but, as a result of the partnership in the consultation, they do make it better.
Inland Revenue officials have worked tirelessly to ensure that all the information was available to Members of this House and the other place, and to those organisations outside the House that were actively helping us to design the Bill. I must even tell the hon. Member for Arundel and South Downs that the speaking note that
he read out and attributed to Lord Higgins was, in fact, prepared for Baroness Hollis. When we accepted that the amendments had been tabled late, the Government provided the House of Lords with all notes and ministerial speaking notes. We also provided all the technical details, and full explanations of them. We offered their Lordships meetings with officials, and I would even have honoured the meetings that were, rather baldly, set up with me. However, I am glad that that did not turn out to be necessary.Amendments may improve a Bill, but it may be inconvenient for the House to deal with them. Ministers must decide the balance between those two factors. I decided that we should continue to improve the Bill as much as possible.
I apologise to both Houses for any inconvenience caused, but I remind hon. Members that most of the amendments are consequential. Lord Russell was very generous in his comments, and even Lord Higgins said that the Bill was improved by them. His objections therefore perplexed me.
Mr. Webb: My observation—it was not a criticism—was not that amendments were tabled late. If a problem is spotted, it should be corrected. However, why did not the mechanisms that allowed outside observers to spot the problems come into action earlier in the process? Legislation is under constant scrutiny after it has finished its passage through the House, but why did not the process of technical clarification happen earlier?
Mr. Deputy Speaker: Order. I appreciate that the Minister is responding to questions that have been raised, but we are not at present dealing with the amendments that are before the House. I hope that she will respond briefly to the hon. Member for Northavon (Mr. Webb), but then she really ought to turn to the amendments.
Dawn Primarolo: Indeed, Mr. Deputy Speaker. The hon. Gentleman answered his own question, which is that legislation is normally scrutinised in detail after it has been passed. The option is to take much longer and have draft legislation available for years in advance, to do it as the Government have attempted to do, or to do as people suggested and table amendments once the legislation is finalised. Points on most legislation are made afterwards, causing amendments to be tabled.
I think that I have dealt with the point of the hon. Member for Arundel and South Downs about the amendment. If there were a criticism to be made of the Government—because it is the Government who found that changes needed to be made—it would be that they were trying to be too helpful. This may be a dangerous thing for a Minister to say, but long may the Government and their Ministers continue to be helpful in ensuring that legislation is improved.
I am grateful to the hon. Members for Arundel and South Downs and for Northavon for the positive way in which they have commented on the amendments. I look forward to their continued involvement as we roll out the tax credits up to April 2003; they have touched on important issues that can be dealt with only when the legislation is finalised.
Lords amendments Nos. 3 to 6 agreed to.
Clause 7
Lords amendment: No. 7.
Dawn Primarolo: I beg to move, That this House agrees with the Lords in the said amendment.
Mr. Deputy Speaker: With this we may take Lords amendments Nos. 8, 24 to 31, 84, 98 and 100.
Dawn Primarolo: I will be as brief as I can on these amendments, which make technical and drafting improvements to the provision in clause 17 about the processing of the final entitlement at the end of the year. Before I explain the main changes made by the amendments, I should perhaps explain why the group begins at clause 7. That is simply because, as a result of the changes that I am about to describe, the terms "current year income" and "previous year income", currently defined only for the purposes of clause 7, will in future have an application elsewhere in part 1. For this reason, amendments Nos. 7 and 8 make the purpose of the Bill clear.
Amendments Nos. 9 and 10 are short, technical amendments, intended to clarify the scope of the Treasury's regulation-making powers under subsections (6) and (7) of clause 7.
Mr. Deputy Speaker: Order. I think that the right hon. Lady has jumped ahead a little. Amendments Nos. 9 and 10 come in a later group.
Mr. Deputy Speaker: Order. There is no reason why we should not put the two groups together, if it makes life easier for the right hon. Lady and everybody else.
Dawn Primarolo: That is extremely generous of you, Mr. Deputy Speaker. I am not quite sure that it will make life easier, but I will start again.
We are discussing amendments Nos. 9, 10, 11 and 17—
Mr. Deputy Speaker: Order. Can I help the right hon. Lady? We are debating Lords amendment No. 7—that is the principal amendment. In the same group are Lords amendments Nos. 8, 24 to 31, 84, 98 and 100. There is a subsequent group, that we have not yet come to, which consists of Lords amendments Nos. 9, 10, 11 and 17.
6.45 pm
Dawn Primarolo: Thank you very much, Mr. Deputy Speaker. I now discover that I was correct before I changed direction. I am not sure what made me change direction, but I apologise, and will return to the amendments before the House.
Let me resume by saying that this group of amendments deals specifically with finalising entitlement at the end of the year, dealt with under clause 17. However, the main changes made by this group of amendments start with clause 7. That is simply because, as a result of the changes, the terms "current year income" and "previous year income" which are defined only for the purposes of clause 1, will in future have an application elsewhere in
part 1 of the Bill. For that reasons, amendments Nos. 7 and 8 make it clear that those terms are defined for the purposes of part 1. At the same time, amendments Nos. 98 and 100 add those terms to the list of terms as defined in clause 44, the interpretation clause.The most important changes are those to clause 17, which sets out the machinery for finalising the end-of-year awards. As discussed in previous deliberations, entitlement to tax credits will be based on annual income. This means that entitlement can finally be determined only after the end of the tax year, when all the relevant information is known. Clause 17 therefore requires that claimants be given an opportunity, after the end of the year, to provide details of their income and circumstances so that the Inland Revenue can finalise their entitlement.
None of the changes in this group of amendments is intended to change the process and the way in which the Bill works. However, as originally drafted, clause 17 required the board to ask claimants to confirm details of their relevant income. The clarification of relevant income is important. Requiring claimants to report details of their relevant income at the end of the year would mean that to arrive at the correct figure to report to the Inland Revenue, they would have to carry out a comparison of their previous year income with their current year income, applying the threshold for rises in income where relevant. In addition, most claimants would also need to report their actual current year income to the Revenue at the same time, so that their award could be renewed.
There is no need for the Bill to impose such a burden on claimants, nor was it intended to do so. The amendments clarify the correct explanation of relevant income and therefore the obligations that are placed to supply that information to the claimant are made clear in the Bill. Before the changes, the provisions could have been interpreted to mean that claimants were being asked to undertake all the calculations themselves, but that job is undertaken by the Revenue.
Thank you very much for your assistance, Mr. Deputy Speaker. I hope that that is now clear.
Lords amendment No. 8 agreed to.
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